During the campaign just concluded not one month ago, much discussion happened, and was not paid attention to, as to how to deal with our budgetary problems. During one of the nationally televised debates, Barack Obama stated, as a mater of fact, that sequestration would not happen. So, here we are today, and Barack Obama has yet to propose or listen to, any serious ideas on how to deal with things. He, and the Democrats want what they have termed as a balanced approach, which means to increase the reckless spending, increase our taxes, lie to us about cutting spending at some future date, and lie to us about cutting our taxes. It won’t cut our deficit or reduce our debt, but it will have the virtue of laying further waste to our floundering economy and growing an already out of control federal behemoth in both size and scope.
During the last six months, and indeed during the Democrat National Convention, we have heard from some of America’s wealthiest corporate leaders, who by the way are lumped in with Republicans when vilification is taking place, about how America’s wealthiest 1% would be thrilled to step up to the plate and do the patriotic thing. This form of patriotism of course meant that they would stump for Barack Obama’s plan to increase their taxes, while allowing us to not have to worry about those nasty consequences. The strategy was a resounding success, or so I have been told. The Democrats won the White House, kept control in the Senate and even managed to gain seats there, and lessened their margin of minority in the House.
Americans want the likes of Warren Buffett to pay a higher tax rate, ostensibly to fund their ever increasing basket full of goodies paid for by government largess. A funny thing happened on the way to the capitol however. Immediately after the election, those very same captains of industry that we were admonished to hate as evil greedy causes of all of our ills on one hand, but who simultaneously stumped for their own punishment on the other hand, managed to prove the mechanics behind the Laffer Curve.
Watch the video to see what I’m talking about.
Jim Sinegal, after advocating for increased taxation of the, “rich,” during a keynote speech delivered to the Democrat National Convention, borrowed Millions on behalf of the shareholders of Costco in order to pay a dividend not due until the fiscal quarter ends at the end of January, now. You see, paying the dividend during December of 2012 will carry a smaller tax burden than when it is due to be paid, which normally for Costco would be in February. That is the entire point of the Laffer Curve, and why increasing tax rates will actually generate smaller federal revenues. The, “rich,” simply will take the steps necessary to alter their liabilities through this very type of fiscal maneuvering. It happens every time tax rates are raised, and it happens like clockwork. It happens so faithfully, that economists from Art Laffer to Andrew W. Mellon have been able to correctly identify down almost to the penny what the resultant revenues would be based on adjustments to rates of taxation. One of the Keynesian School’s many flaws in economic theory is the failure to account for changes in human behavior due to various economic stimuli. Another of its many flaws is the failure to realize that just like pain having a function in the human body, it also has an important function in a vibrant economy.
Then of course, there’s the small issue of hypocrisy.
Warren Buffett went on a national tour pimping out his secretary in order to convince us that he deserved to pay more, something closer to his fair share. What he neglected to mention is that he actually owes over a Billion dollars in back taxes and has retained a team of lawyers expressly for the purpose of getting out of paying those taxes that an appeals court has had to tell him on multiple occasions that he in fact must actually pay. Jeffrey Immelt has lead the cheer leading section on every increase in taxation rates and big government largess while utilizing the the loopholes in the tax code so effectively, that his GE profitability behemoth has not paid any tax on her revenue for years. Jim Sinegal, less than a month after winning a political victory in which he personally advocated for an increase in taxation rates pulled a relatively complex maneuver in which he avoided paying Millions in taxes. The legality of his maneuver is somewhere in the grey area of the tax world, and will probably be hashed out at tax payer expense at some later date, during an IRS audit which will receive almost zero press coverage.
At what point in time will we collectively get sick and tired of the elite class advocating for a set of rules designed to help the, “little guy,” and then taking every measure imaginable to exempt themselves from the frightful subsequent consequences of those rules? Citibank today announced a layoff of 4% of her workforce, due to the Obamacare law that she helped to pass through her open promotion and cheer leading. On top of that, Citibank is one of the businesses who received one of the precious waivers exempting her from most of those costs. That should scare the hell out of everyone. The, “rich,” corporate executives and Hollywood entertainers will never have to wait in line like the rest of us for health care due to the already in progress rationing that has not come anywhere near close to getting itself into full swing. Their lifestyles will not be impacted in any material way due to the policies that they have inflicted upon the rest of us. If they were to feel that impact in some way, they’d be the first to scream bloody murder. The recent whining about people downloading movies and music off of the internet without paying the appropriate royalties is the crystal clear example of that fact in action.
It’s far easier for two people to decide the fair share of a third person than it is to follow the laws established in our Constitution. The entire concept of our Constitution somehow growing lungs and becoming a living document has created an environment where irresponsible politicians can hide their malfeasance in flowery language that has made their decades long assault upon our freedoms seem like they were protecting them all along. If they want a 90% tax bracket, so be it, but by golly, those who vote for it should be forced to live with its consequences. When our health care system is destroyed, there ought not be a single private doctor anywhere for Will Ferrell or Demi Moore to hire when they have so much as the sniffles. Those who pushed this off upon the rest of us in the interests of fairness should be subjected to that very same system, it’s only fair.