On Trickle-Down Ryan

Rep Paul Ryan (R-WI), Speaker John Boehner (R-OH), and any other bandwagon Republican want to cut corporate taxes in order to stimulate investment. Why not? Profits go up, thus companies can invest more. News Flash: Hey … Trickle Down does not Work!

Hope about a few reality checkpoints on the matter.

Profits go up, and the shareholders are happier. Corporations are first accountable to their shareholders. Yep, the shareholders get preferential treatment over the community, over the state, and over the country. You see, capitalism is not patriotic.

Profits go up, and the executives get more (thus cutting into investment). As if people in these positions don’t already get enough. Then again, more means more.

Cash reserves increase, which then allows one company to purchase another – thus a loss of jobs.

Let’s say the company is willing to invest, thus increase employment. What is the guarantee that they do so within US borders? For those in the GOP who down know, the answer is, There is no guarantee!

Bottom line: You want to stimulate companies to invest in America, don’t give them a tax break to do something – give them a tax credit for doing something.

On Tax-Cut Shorts

I haven’t said much about the proposed tax deal. In general, I’m against the cuts for the highest income, and against the social security tax cut from wages, but in the spirit of the pragmatic, sometimes one has to get it done in the spirit of Monty Hall through let’s make a deal. Below are some random thoughts the tax-cut deal.

I know those with money can lead investment to improve the economy, but what’s the guarantee that they will do so? Instead of giving the highest income a tax cut with hopes, I prefer issuing credits for those that do.

The 1990s were a time of good economic growth. Hmmm … economic growth can happen at a higher tax rate?

Citizens need to remember that the personal tax code and business tax code are separate entities – even though the Capitol Hill jackwagons use them interchangeably.

The White House-Republican agreement is a great example of a stimulus that isn’t called a stimulus.

Less money will go into the social security fund for the next two years – and what’s the plan of funding the decrease? Oh … that’s right … when more people work because of investment by the high incomers.

Senator McConnell (R-KY), I ask you your own question – How are we going to pay for this? Oh that’s right, that doesn’t apply to your ideas.

Let’s wonder about the over 6,000 special projects (that is earmarks, pork, etc) attached to this bill. Alas, the GOP held President Obama hostage in terms of getting their tax cuts, so many Democrats return the favor with their earmarks. Oops … some Republicans also submitted them – include Senate Republican Leader No-More-Earmarks McConnell. Let’s change the title to the Pledge to America with an Asterisk. How about adding this asterisk – in order of a legislator to get the earmark, they must vote YES for the bill – otherwise, no bacon for you.

Capitol Hill’s occupants gotta be whooping it up with the latest 13% job approval rating in the latest Gallup Poll. Cheers on achieving the worst rating ever. Good news Republicans, you can take credit for the future turnaround. (Psst … it count go much lower, so it has to go up … but I won’t tell.)

Is compromise a dirty word? I appreciate this opinion from Gloria Borger (CNN) about compromise. Keep the recent Gallup Poll in mind.

Let’s see what Sonny and Cher have to say about Capitol Hill.

On the Deficit Commission’s Revenues

Not long ago, a friend questioned my post when I suggested addressing the deficit through tax increasing and spending reduction. I thank President Obama’s deficit commission for supporting my point.

The leaders of the bipartisan deficit commission recently released their ideas that will serve as the groundwork for their work ahead. Erskine Bowles (D) and Alan Simpson (R) realize the fastest way out of the deficit situation is the no-brainer, two-prong approach of increasing revenues and decreasing spending. However, we must think of politicians as marketers.

Take tax cuts, which in themselves decreases government’s revenues – thus a direct contradiction to the commission’s aim. To sell it to the people, the politicians must promote cutting taxes while disguising tax increases. Although President Reagan’s tax cuts greatly reduced the tax burden on the rich – the tax at that time was ridiculously high – the middle class also received a lower tax rate at the expense of fewer deductions – and in the end, paid more taxes (amount). A brilliant bit of salesmanship.

It’s simple – lower tax rates coupled with a deduction reduction means we (taxpayers) can actually pay more taxes (amount) while believing we are paying less (a lower rate).

As the current commission examines tax cuts, they have also made it known that deductions would decrease and other taxes, such as a 15% increase gasoline tax, would take effect. To my friend and others I ask this question, “Which way do you want tax increase: overt or covert?”