A Facile Right Wing Dismissal of "Occupy Wall Street"

Here is a link to Lowman S. Henry's op-ed piece in the October 16 Harrisburg Patriot-News:  http://www.pennlive.com/editorials/index.ssf/2011/10/tea_party_strives_for_change_o.html

After reading Mr. Henry’s piece, it occurred to me that pretty much anyone can write a similar piece.  All one has to do is listen to Rush Limbaugh, then flip over to Sean Hannity.  Then, you just write down their talking points, and, bingo, you’re done.

Mr. Henry’s premise is that while the Tea Party movement is a well- reasoned, deeply felt grass roots movement, Occupy Wall Street is just a bunch of kooks who put on funny costumes and want the government to take care of them.  It’s an interesting idea, but where is the support for his premise?  I searched through his article for facts and statistics to support his concept, and came up empty.

While I don’t support every aspect of Occupy Wall Street, I have no doubt that they are well-meaning people whose anxiety about our country’s future is deeply felt.  What enrages Occupy Wall Street is that we are increasingly becoming a nation of haves and have nots.  Unlike Mr. Henry, let me offer some facts. 

In 2007, the last year for which such information is available, the top 1% of the US population held 43% of the country’s financial wealth and 35% of the total net worth. By contrast, the bottom 80% of the population has only 7% of financial wealth and 19% of the total net worth. The percentage held by the very wealthy has been steadily increasing during the past generation, and dramatically so since 2001, when the Bush tax cuts on the rich came into effect.  The last time we had this much wealth disparity was the gilded age of the robber barons.  Many folks feel that they’ve been playing by the rules, but the American Dream is just a game that is rigged against them.  These concerns are the genesis of Occupy Wall Street.

It is counterproductive to dismiss the concerns of either the Tea Party or Occupy Wall Street.  Mr. Henry’s right wing talking points bring us no closer to a solution to our country’s problems.

The Republican Tea Party's Brave New World of Disrespect

Did you see what happened at the Republican Presidential debate in Florida recently. A gay Iraq war veteran rose to ask a question AND WAS BOOED. Even worse, not a single candidate on the dais rose to defend his right to speak.

Welcome to the new Republican Tea Party - where we respect and honor all of our brave veterans..., except for gays and lesbians, of course.

Everyone is certainly entitled to express his or her opinion.  That's what these brave veterans fought to defend.  But, there's a word for behavior like that exhibited at the Republican debate - DISGRACEFUL!!

Criticizing Warren Buffett For Doing His Job

I read Frank Ryan’s op-ed piece in the September 6 Harrisburg Patriot-News. Here is a link to it:  http://www.pennlive.com/editorials/index.ssf/2011/09/warren_buffett_complains_about.html

After cutting through the accounting-ese, his main point seems to be that Warren Buffett is a hypocrite because he first criticizes the current federal tax code but then uses it to benefit his company, Berkshire Hathaway. My reaction is “Huh?” I wonder if Mr. Ryan has ever practiced accounting in a business setting, as opposed to serving in the Marine Corp Reserves and lecturing on ethics.

It’s not the least bit hypocritical or unethical for Mr. Buffett to use the federal tax code to the advantage of his company while competing in the marketplace with all of the other companies that are undoubtedly doing the same thing. In fact, if Mr. Buffett were to ignore the benefits of structuring that the government allows companies to take advantage of, he would be violating his fiduciary duty to his company. Because Berkshire Hathaway is a public company with millions of shareholders, he would probably be liable for damages to these very shareholders. As the CEO of a public company, Buffett is not free to ignore tax code provisions that would benefit his company just because he doesn’t agree with them.

Warren Buffett believes that our tax code should be changed so that the rich pay their fair share. Many of us would like to see the laws changed so that companies will be more focused on whether a particular transaction will be profitable over the long term, rather than whether it will be beneficial under the tax code. But, neither Mr. Buffett nor any other CEO of a public company is about to unilaterally disarm and refuse to take advantage of these provisions, while they are still in effect. To accuse him of being hypocritical is just silly.

ARE WE OVER-TAXED? THE OBJECTIVE EVIDENCE SAYS NO.

F. Scott Fitzgerald famously said: "The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function." With that in mind, let me make a modest proposal. Yes, we do have to reign in government spending. But, the objective evidence shows that we are not over-taxed.

Most people agree with the first statement. But, the second one is absurd on its face, isn’t it? All we hear these days is how overtaxed we are, and what a drag this is exerting on our economy and its ability to prosper and create jobs. But, recently, a commentator on a national show noted that federal taxes are currently 14% of the nation’s Gross Domestic Product (GDP), which is the lowest since 1948. Who was this commentator, some liberal Democrat, right? Sorry, it was Reagan’s budget chief, David Stockman, a strong fiscal conservative.

It is simply a myth that we are overtaxed. Corporations and rich individuals currently have the smallest percentage of their incomes taxed in generations. Sure, the Tea Party rants about how high their theoretical tax rates are. But, no one with an IQ above room temperature actually pays those rates, because of all the exclusions, deductions and other loopholes available to them. The rich and corporations hire high priced accountants and tax advisors to take full advantage of all the loopholes. We don’t need higher tax rates. If we had a cleaner, simpler tax system, we could have lower marginal tax rates but still raise more revenue.

As Mr. Stockman noted, we have a fairly simple problem – federal taxes are 14% of GDP while federal spending is 24% of GDP. What we have to do is reduce the latter significantly and also increase the former somewhat. If we just increased the tax percentage of GDP to the level it was at in 2000, we would be in fine fiscal shape, if we combined this with some sensible expenditure cuts, such as reducing subsidies to oil and gas companies. If we’re over-taxed now, why was our economy doing so well in 2000, when taxes on upper incomes were much higher?

Another wise commentator hit the nail on the head the other day. David Gergen has advised several Presidents, including Ronald Reagan. He says our biggest problem is that too many politicians today lack imagination and backbone. He says we need to think back to Pres. Reagan, who raised taxes several times. He did it in cases where he was able to cut a deal that benefited his constituents and the country as a whole. He forged several deals with politicians like Tip O’Neill, surely his equal on the other side as an ideological liberal.

Then Reagan went straight to the American people and persuaded them that he was right. He convinced them to tell their political leaders to go along. Gergen says a clever and resourceful leader will succeed in this way. Sure, there is a chance he or she might fail in the attempt. But, isn’t that what leadership is all about. Too many of today’s politicians spend their time looking back to make sure the crowd is following, rather than boldly leading in the right direction. They blindly sign pledges put forward by right wing saint Grover Norquist. Once they’ve signed, they can never go back, no matter how sensible the plan, because they made a promise to Saint Grover.

I believe Ronald Reagan was far too savvy a politician to sign such a foolish pledge. Indulge me as I channel Pres. Reagan. Here’s how I think he would explain a grand bargain to get our country back on a proper fiscal footing:

“I hate raising federal revenue as much as anybody, and more than most. But, I’ve cut a deal with Congress that cuts $4.00 of federal spending for every $1.00 in additional federal revenue. We’ll have a streamlined, simplified tax code that frees businesses to make decisions based on how profitable they will be, rather than on which tax loophole they will qualify for. This is simply too good a deal to pass up. If you really care about your country’s future, you will join me in supporting this agreement.”

Will we ever find politicians with the imagination and guts to break out of the current left-right gridlock? For my future, and especially those of my children and grandchildren, I sincerely hope so.

Give Me Chastity, But Not Yet!!

The Senate Republicans don't seem to be interested in any sort of compromise that would result in a balanced budget, like closing tax loopholes. Instead, they are proposing a balanced budget amendment to the Constitution. This reminds me of the famous saying of St. Augustine: "Give me chastity, but not yet."

Apparently, they'd like a balanced budget sometime in the misty distant future, but certainly not today or tomorrow. How can anyone take their position seriously. Are you listening, Tea Party?

Surprase, Surprase, Surprase

Well, to quote that well known sage Gomer Pyle, "Surprase, surprase, surprase". President Obama was born in this country after all. But, we shouldn't be surprised that so many folks were swept up in the silly notion that he was born in a foreign country, despite the clear evidence to the contrary.

It wasn't all that long ago that the previous Administration took us into a war that cost hundreds of billions of dollars and thousands of lives using justifications that turned out to be totally specious. After that experience, it will take a long, long time for people to regain faith in our institutions, if it will ever happen.

Too bad there was no certificate we could have gotten to show there were no WMDs, no nukes, and that Sadaam had nothing to do with 9-11.

First Steps To Balance The Budget

Folks from throughout the political spectrum should be able to agree on one thing – we are living beyond our means. We’ve been doing so since 2001, after a brief sojourn in the 1990s when the budget was balanced. It’s much harder to reach consensus on what we should do about it. Some, like Rep. Paul Ryan, say we must balance our budget solely by cutting federal expenditures. The inevitable result of this will be substantial cuts to programs that benefit the neediest in our society, including ending Medicare as we have known it.

One way to get at a possible solution to this dilemma is to look at some statistics. In 2007, the last year for which such information is available, the top 1% of the US population held 43% of the country’s financial wealth and 35% of the total net worth. By contrast, the bottom 80% of the population has only 7% of financial wealth and 19% of the total net worth. The percentage held by the very wealthy has been steadily increasing during the past generation, and dramatically so since 2001, when the Bush tax cuts on the rich came into effect. We have become a nation of haves and have-nots, reminiscent of the gilded age of the robber barons.

There is no question that we will all have to do more with less to balance out federal budget. But, surely the place to start is to eliminate the Bush tax cuts on the rich. They have benefitted richly from our great country. They should be willing to repay their fair share.