Double talk

English: George Orwell in Hampstead On the cor...

English: George Orwell in Hampstead On the corner of Pond Street and South End Road, opposite the Royal Free Hospital. The bookshop has long gone. (Photo credit: Wikipedia)

The GOP have adopted Orwell’s 1984 as the authority for their thought and speech: doublethink and double talk from the Ministry of Truth where words have the opposite meaning of that commonly accepted and found in dictionaries.

The FAIR tax is not fair. It is a flat consumption tax with a gimmick, rebates to low-income consumers that I predict will disappear over time once the GOP have attained their objective. Their objective? Abolish the progressive income tax and the IRS.

Safety nets made of tissue paper that won’t hold water or rescue the needy either from accident or weather related distress.

The death tax which is not a tax the dead pay, but one assessed on the living. We claim to believe in a level playing field, so why should some be given an enormous head start in life? It is harmful to democracy and frequently harmful to the development of character in heirs and heiresses.

Compromise to the GOP means give me all I demand and 50% of what you demand.

Free markets are free from regulation so that competition can be stifled and monopoly profits earned.

 

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US national debt

English:

English: (Photo credit: Wikipedia)

If we pay payroll taxes for 30 or 40 or 50 years as I did, then an individual is entitled to expect that the government lives up it its promises and provides adequate Social Security and Medicare benefits. If lenders lend money to the US government to fund the US national debt as wealthy citizens here in the US and around the world together with some governments have done, then they are entitled to expect repayment with interest in the future. Thus it is possible to look at all government expenditures as an entitlement of some sort. One principal difference among the various forms of entitlement is whether the funding is voluntary or forced through taxation. Another principal difference and one that is often overlooked is who are the beneficiaries of government entitlements? In the case of Social Security and Medicare, the beneficiaries are the 99%. The 1% pay payroll taxes too, but they are wealthy enough to pay for their own retirement and health care, most of us are not. The beneficiaries of the national debt being repaid are the 1%, wealthy individuals here in the US and around the world and some governments.

As I see it, some in government are willing to reduce some entitlements if the beneficiaries are the poor and middle class, while entitlements for the 1% must not be touched. Looked at that way, the GOP willingness to reduce Social Security and Medicare while preserving those entitlements of the wealthy 1% make perfect sense.

Social Security Plus

Seal of the United States Social Security Admi...

Seal of the United States Social Security Administration. It appears on Social Security cards. (Photo credit: Wikipedia)

I support the idea of Social Security Plus where Social Security benefits are quickly or gradually doubled. I do not expect to live long enough to see it happen, but I do expect to see the effort to reduce Social Security benefits by means of the chained CPI gimmick succeed at least temporarily. Our present economy requires stimulus and one of the best ways to stimulate it, in my humble opinion, would be to increase Social Security benefits because those dollars will be spent, rather than saved as would tax cuts for the 1%.

Please see Secure Retirement | Chained CPI

Tax reform

Fair & Balanced graphic used in 2005

Fair & Balanced graphic used in 2005 (Photo credit: Wikipedia)

Later this year Congress may take up the issue of tax reform. I specifically oppose the so-called FAIR tax, which is a consumption tax with exemptions for the poor. Not only is it regressive, but proponents want to set the rate at such a level that they claim it could replace income taxes, estate taxes, capital gains taxes and the IRS. Don’t be fooled by the misnamed FAIR tax. It is a regressive tax that is as fair and balanced as FOX News.

Mitt’s taxes part 2

Tax

Tax (Photo credit: 401(K) 2012)

If we ever learn about Mitt’s tax history, no one will care. I posted a blog post entitled Proposition 13 and tax reform in which I advocated the abolishing of the property tax and the sales tax, to be replaced by the graduated income tax and a wealth tax on net worth. Let us crunch a few numbers and see what Mitt’s taxes might have been if my proposals were adopted. In 2011, Mitt paid about $2 million in Federal income tax on $14 million, a rate of about 14%.

Say that Mitt made $14 million and paid a Federal rate of 30% or $4,200,000.
On an estimated wealth of $250 million, he would pay 1% or $2,500,000 annually, for a total $6,700,000.

If he lived in California for tax purposes and the state levied a state income tax of 40% of the Federal income tax and 20% of the Federal wealth tax, his state taxes would be:
40% of $4,200,000 or $1,680,000 and
20% of $2,500,000 or $500,000 for a total of $2,180,000 to the state of California.

On an income of $14 million, Mitt would pay Federal taxes of $6.7 million and California taxes of $2.18 million for a grand total of $8,880,000. That would be a combined rate of 63% leaving Mitt with only $5,120,000 after taxes to live on. That works out to nearly $100,000 after taxes every week of the year. I could happily live on just one of those weeks’ net income after taxes.