tax cuts for the rich

A Shitty Deal

December 9, 2010 by Bitchy

Not the kind from the internal Goldman Sachs emails. No, this is a shitty deal to end all shitty deals. I am of course, referring to Obama’s tax cut deal.

Has anybody looked at the details of the detail he struck? He actually went far beyond Bush’s original nation crippling tax cuts. Here are some highlights;
– The top 2% of wealthiest Americans get to stay at the 36% rate they’ve enjoyed for ten years.
– The estate tax goes down from 55% to 35%.
– Capital gains taxes get cut down to 15%

Just so that we’re clear, all of the above cuts benefit ONLY the wealthiest among us. None of these cuts benefit the middle class. The estate tax cut is even worse than it sounds. Not only did Obama cut the estate tax by 20%, but he also raised the level at which the estate tax kicks in from $1 million to $5 million. How many middle class Americans have $3 million dollar estates to hand down, do you think? Capital gains isn’t money that you earn. It’s money that your money earns. It’s stock appreciation, property appreciation, etc. The capital gains tax rate is now FAR lower than the tax rate we all pay on our paychecks.

95% of Americans don’t enjoy capital gains. WHY should any tax rate be lower than the taxes paid on earned income? That’s just crazy. Nothing should be taxed lower than your paycheck. That should be the baseline rate upon which all other tax rates are increased from.

25% of all of the tax cuts in this “compromise” benefit just the top 1% of Americans. Yeah, that’s equitable.

Did I forget to mention that this deal includes a payroll tax cut? Sounds nice, right? Here’s what it actually means; less money will be taken out of your check for your social security contribution. This will hasten the social security shortfall that wasn’t otherwise going to happen until 2037. You understand where this is going, don’t you? This is going to lead to cutting social security. This is a topic for a whole post unto itself, so I’m going to move on.

We don’t have the money to pay for these tax cuts, so we’re going to add to our already astronomical debt in order to make it happen. This growing debt significantly weakens our economy.

Now democrats will say that this deal was necessary in order to save the unemployed from running out of benefits. I say, bullshit. Unemployment benefits are a means to help people to tread water until the coast guard comes to save them. The problem with this deal is that the coast guard is never coming.

Turning this economy around requires a two pronged approach. The first part of recovery was programs like the stimulus package. The government has to step in to be the spender of last resort. When Americans have no money to spend, and corporations aren’t generating revenue because Americans are broke, that’s when the government must step in. Spending money in infrastructure projects creates jobs across a very large supply chain. The second part of an effective recovery plan is to ensure that Americans can tread water until the unemployment rate comes down. This includes programs like unemployment insurance and food stamps. These two programs not only help the recipients, but they also create exponential economic activity.

The idea is that the infrastructure projects will create jobs that cascade over a big supply chain. These jobs will in turn, generate taxable income which will ostensibly help us to pay down our debt and strengthen the federal government so that is has the resources to invest in more job creation programs. The unemployment and food stamp benefits are supposed to help people hang on until that supply chain grows enough to create jobs for the unemployed.

Obama’s deal weakens the federal government by increasing the debt twofold. We’re borrowing money to give to the rich, and we’re borrowing money to keep people on unemployment. Since there’s no further stimulus in this deal, it’s essentially all gratuitous spending with no job creation component.

Nobody is going to show up with jobs for the unemployed. The ’99ers” are going to become the “198ers”. Since I’m in the business of hiring people, let me confirm something that you already know. The longer someone is unemployed, the more unemployable they become. Hiring managers have a viscerally bad reaction to people that haven’t been able to find a job in a year. The 99ers won’t be employable until the unemployment rate dips below 5%. Once that happens, there will be a labor shortage that will make them more attractive to employers.

Nothing about this plan is going to get the unemployment rate down. Obama didn’t “save” the unemployed. He just insured that they’re going to be treading water in their current miserable state of unemployment forever. This plan just prolongs their misery. And they’re still being held hostage by republicans. I can assure you that Obama is going to have to make another appalling deal to “save” unemployment insurance by this time next year. My prediction is that the jobs report for February, when all of the seasonal retail jobs are gone, will be appalling.

This really was the grandaddy of all shitty deals.

And the worst part? Obama is now defending the bullshit republican tax policy. He’s forcing democratic house members to do the same, thereby undermining the democratic position for years to come. We’re never going to get out of this debt because there’s no one left to stand up for sound fiscal policy.

You’re burning down the house with your shitty deal, Obama. Thanks for nothing!

A Multi-Tasking Machine Of Spinelessness

December 8, 2010 by Bitchy

Did anybody read the title and not think that this post was going to be about Obama?

I’ve reached the end of my rope with this president. The tax cut deal was the straw that broke bitchy’s back.

I’ve been of the belief that one of Obama’s problems is that he lacks conviction. I’ve graduated from “belief” to “certainty. He’s not passionate about anything to fight for it, or to even hold his ground.

I honestly thought I voted for a born leader when I cast my vote for him. Turns out that what I got is a middle manager with no real future. He tries to stay under the radar by capitulating to everyone in perpetuity; the quintessential middle manager.

The only belief that he seems to hold firm to, is that there’s always a middle ground to be found. Sadly, he defines “middle” as being slightly less than republicans are demanding, but far more than they ever expected to get.

Just four short weeks ago, all of the republican leaders were sending very strong signals that they would sign a tax bill that excluded the stinking rich if that was all they could get. Did Obama miss that? Was he busy creating a new playlist on his iPod to watch CNN that week? Seriously, what the fuck? Boehner couldn’t have been more clear about his willingness to cave. Don’t believe me? Watch!

And yet Obama still caves by giving them two more years of billionaire tax cuts, thereby increasing our deficit by another 140 billion dollars.

Here’s a fascinating breakdown of the relationship between the top marginal tax rate and the unemployment rate. This graph tells us that there’s an excellent chance that the unemployment rate in this most precarious of times, is very likely to stay high as a result of prolonging these tax cuts.

Can anyone guess what republicans are going to run on in 2012? Could it be the fucking deficit and the unemployment rate?

And what do you think Lloyd Blankfein is going to do with all of the extra cash in his savings account? Is he going to hire people, or is he going to use the money to bitch slap Obama in the 2012 elections by contributing to whoever his republican opponent is?

On the upside, Obama is figuring how to let republicans do three times as much damage with one single kick in the testicles. This saves them a lot of effort. While I admire his deference to Mitch McConnell, in making sure that he (McConnell) doesn’t tire himself out by having to expend more energy than necessary to turn Obama into a eunuch, I wish he would find just a little deference for the people that voted for him and the platform he ran on.

This latest buckling was like so many before it, unnecessary and damaging to us all. You see, we’re having to borrow more money from China so that Jamie Dimon doesn’t have to pay 3.5% more in taxes (as if his accountant can’t find loopholes to cover that).

This s bad for all Americans, but Obama is particularly bad for democrats. Each time he caves into republicans, the thing that he caved in on becomes the thing that Obama owns. These tax cuts for the rich will no longer be referred to as the “Bush tax cuts”. No, they’re the Obama tax cuts now.

Make no mistake – extending these tax cuts is the worst possible thing that can happen to our economy.

And no, this didn’t have to happen (something I hear from democrats all the time). Obama didn’t have to cave. 76% of Americans don’t want these tax cuts extended. He could have leveraged that political capital to stop a compromise from happening. He should have held a prime time press conference to spell out what republicans are trying to do to us, and named names in the process. He should have done this on the day that republicans blocked the tax cut vote on Saturday. He instead made a half assed effort to make his case.

Either he sucks at politics, or he wanted to extend these tax cuts all along.

Democrats already have a serious messaging problem. Having a leader that is willing to shit all over the basic tenets of the democratic party isn’t helping.

I’m worried that Obama is going to irreparably damage the party if he caves in on cutting social security. NO ONE wants for social security to be cut. Well, no one except the people that made out like fucking bandits on these tax cuts anyway. 76% of Americans (republicans and democrats combined) feel adamantly that social security should not be touched. If Obama does so much as raise the retirement age, democrats will forever be the party that cut social security.

Obama’s capitulation has escalated beyond the point of just being frustrating to the democratic base; it’s reckless and dangerous for the country and it will decimate the democratic party.

I’m well past the irritated with this president stage. I’m scared shitless of him in a way that I haven’t been scared by a president in my lifetime. If

Another Disastrous Concession; Tax Cut Edition

November 11, 2010 by Bitchy

David Axelrod just confirmed that Obama is going to cave in on tax cuts for the rich. I’m feeling demoralized, to say the least. This is another example of unnecessary acquiescence that hurts America, by Obama. We can file this one with Van Jones, Shirely Sherrod, and ACORN.

Look the strategy on this one should have been very simple since most Americans, democrats and republicans alike, are opposed to this. Democrats should have done nothing but ask republicans, “How are you going to pay for this?” like simpletons, stuck in broken record mode. That’s all they should be saying about anything. Regardless of what the question being asked by the reporter is, every single democrat should respond with, “How are republicans going to pay for the tax cuts they didn’t pay for the last time around?”. If the question is, “How about those Giants?” The reply should be, “How are republicans going to pay for extending the tax cuts for the rich?”. PERIOD. No other words should be coming out of their mouths until republicans cave.

Another prong of this strategy should be for Obama to continue the praise that he offered to Ronald Reagan during the campaign. Breathe, breathe, and hang in with me for a second. Obama should repeatedly exclaim that he intends to set tax rates where the great and wise Ronald Reagan set them. Over and over, in perpetuity, Obama should be regurgitating out the “Great and wise Ronald Reagan” line.

You wanna know where Reagan had the top tax rate? It was at 50%. Do you wanna know what we’re talking about today? We’re talking about going from 36% to 39%! Are you fucking kidding me with this shit? Off the top of my head, if that 3% difference we’re debating equates to 3/4 of a trillion deficit dollars over the next ten years, I’m going to go ahead and say that if we went back “the great and wise Ronald Reagan” rates, we would be able to raise roughly enough to pay off Bush’s deficit in five years.

This wasn’t a hard fight to win but once again, Obama didn’t even try. Axelrod claimed that they didn’t want to “jeopardize” the middle class tax cuts in order to fight to let the disastrous Bush tax cuts expire. That’s the kind of bullshit false choice that makes me extra, supersized bitchy.

Let me go a step further. I want to raise the corporate tax rate back to 91%, where it was under Eisenhower. That was the tax rate that got us out of the great depression. It works well because it forces companies to reinvest profits, rather than to let their executives pocket the money. Personally, there’s nothing that the government can squander that money on that would be less offensive to me than watching Paris Hilton snort it. Watching the government spend that money on $400 toilet seat covers would be less disgusting to me than watching Lloyd Blankfein spend it on anything. Yeah, I’m the jackass.

Guess what Obama? That extra 3% that you’re letting good old Lloyd keep is ultimately going to be spent on spanking you with his wallet in the 2012 election. Nice move, jackasses. You have once again managed to fuck the country and fuck yourselves.

I can’t imagine why 29% of democrats that voted in 2008 stayed home in 2010.

I’ve said it before, and I’ll say it again – You BLOW, Obama administration!

The Horatio Alger Problem

July 14, 2010 by Bitchy

Horatio Alger is the reason that 50% of the 1.7 million Americans whose unemployment benefits have been disrupted because of republicans in the senate, will vote republican in November. I’ll go a step further – Horatio Alger is the reason why the republican party still exists today.

Horatio Alger was a late 19th century author who wrote happy, clappy rags to riches stories aimed at young working class men. He wrote his inspiring tales during a time when the American dream was actually somewhat viable. Sure the legacy rich have always had a significant advantage in the American “capitalist” system but in Alger’s time, hard working nobodies had some measure of a shot at moving into a higher economic class than the one they were born into.

But his happy claptrap has been coming back to bite us in the ass for decades now. The American dream has been dying a slow and painful death for at least the past 40 years. Income inequality in America is reaching Gilded Age (1880) levels.

Here are some interesting facts about where we’re headed;

-Between 1979 and 2000, the real income in the bottom 20% of earners in the US grew by 6.4%. During that same period, real income for the top 20% of earners grew by 70%.

-The family income of the top 1% grew by 184%.

-In 1979 the average income of the top 1% was 133 times that of the bottom 20%. In 2000 the income of the top 1% had risen to 189 times that of the bottom fifth.

-Thirty years ago, the average CEO made thirty-nine times the pay of the average worker. Today, it’s over one thousand times the pay of the average worker.

According to an OECD (Organization for Economic Co-Operation and Development) study released earlier this year, 47 percent of the economic advantage that high-earning fathers in the United States have over low-earning fathers is transmitted to their sons, compared to 17 percent in Australia and 19 percent in Canada.What does this mean? It means that if you’re born rich in America, you’re more likely to stay rich regardless of ability or intelligence (think George W Bush or the Koch brothers). And when people that are born rich have an advantage by virtue of being born rich, that means they’re taking opportunities away from everyone else (Google: nepotism).

Here’s a little spreadsheet that paints a VERY clear picture of what’s happening to America:

Are you seeing a pattern here between wealth distribution and which party has the white house? 99% of Americans got fucked by Reagan, Bush 1.0 and Bush 2.0.

The wealth inequity in this country is growing, and it’s happening fast. This brings me back to the Horatio Alger problem and republicans.

See, republicans have completely stopped pretending to be a populist party. Between their “slush fund” mantra, when referring to the funds that President Obama secured from BP, to their choking off unemployment benefits to people that desperately need them, their message is clear; we don’t give a shit about average Americans. If you don’t have a butt load of cash to donate to our reelection fund, you can go fuck yourself.

That’s not hyperbole; that’s a very clear message from republicans. Just yesterday, Jon Kyl (the other douchebag senator from Arizona) said that the Bush tax cuts should remain in place regardless of their impact on the deficit. And yet, he will only agree to sanction unemployment benefits for struggling Americans if they’re paid for. His deficit hawkiness evaporates when it comes to paying for tax cuts for his really fucking rich donor buddies. But if you’re one of the 1.7 million Americans fighting to secure one of the 370,000 jobs that are available, then you’re clearly a lazy slacker who deserves to starve. Republicans aren’t hinting at the fact that they think you’re a loser that should just go away already, they’re saying it outright. Sharon Angle has said it, Rand Paul has said it, Jon Kyle has said it, and Tom Delay has said it. That’s just naming a few among a vast sea of republicans that have contempt for struggling workers (see an older post of mine here).

But when it comes to alleviating the suffering of the rich, there’s nothing that republicans won’t do or say. You know how they always champion the elimination of capital gains tax? Let’s take a look at who has capital gains in America, shall we:

Let me explain what “capital gains” are. Capital gains is essentially the money that your money earns for you. It’s the appreciation in value of your investments. This includes property, stocks, and the value of your business. It’s the money that you make from the extra money that you had lying around to invest. Well not you (as we can see from all the data), you’re broke. We’re talking about Paris Hilton. She’s making a shitload of money off the money that her grandfather made. She didn’t even need to be born to smart parents. Her parents aren’t that bright. No, all she needed to do was to be born to the children of a smart guy. Everybody knows Conrad Hilton. Does anyone know the name of Paris’ father? No, me neither. And the best part is that Paris doesn’t have to do anything to make money. That whole celebrity whore thing she does is purely for her own enjoyment.

The fact that Paris and her parents can stay rich, despite having no discernible intelligence or talent, makes them the beneficiaries of another favorite republican cause; eliminating estate taxes. Republicans believe that while you’re working your whole life, amassing no capital with which to create gains, Paris and her family should be able to inherit a crapload of money that they shouldn’t pay one thin dime in taxes on. And Jon Kyl doesn’t care how big of a deficit we have create in order to preserve this “right” for Paris. She was born lucky and dammit, Jon Kyl is going to do everything he can to extend her luck because she’s obviously going to create millions of jobs with her ill gotten gains.

So why would anybody that isn’t among the richest 1% ever vote republican? Because of Horatio Alger and the myth of the American dream. Never mind the fact that you’re on unemployment right now, you’re definitely going to be filthy rich someday, and therefore need to make sure that your kids don’t get hosed by having to pay taxes on the billions that you’re going to leave them in your will. Some people (roughly half of us) have to buy into the thinly veiled republican bullshit in order to keep the illusion of the American dream alive.

The sad irony is that those people are the ones that are killing the American dream. Supporting the republican effort to let rich people keep all of their money (whether they earned it or not), ensures that Americans will get poorer and poorer.

They need to get over it.

Horatio Alger is a fucking fantasy and Paris Hilton will not create a job for you, no matter how charitable you are towards her.

You need to start voting in your own best interest because the illusion you’re under isn’t going to feed you.