Everyone Benefits from Taxes

Tax funds going to the government don’t go to $16 cupcakes as  a FOX NotNEWS story recently pounded.  CNN and network news looked into the claim and found the cost per government meeting attendee averaged $16, but that cost went for the conference room, beverages, other food, paid the servers, and yes, there were some cupcakes.  Part of that $16 paid for several jobs that day.  FOX did not report that because that is reality which they don’t typically report.

Tax money pays for many things which benefit all citizens and companies, and all these things pay for jobs.  Tax money pays for:  an educated population, roads to move company goods to market and their employees to and from work, police and fire precincts to maintain public safety, maintaining all land records for everyone from major corporations to small business and to and every couple hoping to retire off the value of their property, a military which buys massively expensive goods from many of our country’s companies, regulators protecting our retirement savings from the greedy, and on and on and on.  All of these government expenses require jobs to fulfill them.

Despite all the Bush era tax breaks, what were most of the companies doing in the new stories you read the past few years?  They were reorganizing for cost savings.  In other words, they were cutting jobs or moving them overseas so their investors would maintain higher profits.  CEOs are not job creators.  Their job is to run each company with high output from the lowest possible employee and cost base.  Job cutting creates higher unemployment which means there are fewer people able to buy a company’s goods and services.  With fewer people buying a company’s goods, that company eventually needs to cut a few more jobs.  As this predicament inevitably approaches the extreme, the only Americans making money are those rich enough to buy 100,000 widgets from China to sell to the few Americans able to afford them.  Also, there will be some low wage American jobs to distribute these Chinese goods.

An excellent NPR article based on an interview of Nick Hanauer, an author and venture capitalist, can be found at Just What Do the Rich Have That’s Taxable.  Nick is nearly a billionaire and explains most of the rich pay 11% and often lower in taxes.  For example, he explains some actual examples where people made over $250 million and paid no tax on the income.

Consider this:  Who benefits more from a widely educated work force, good roads to ships products across the country, and fire and police precincts to protect their money and property, a maintenance worker making $35,ooo/year, or a CEO and board members of a large, profitable company?  Both benefit from those government services, and it’s possible none of those people would have their jobs without those services.  The difference is, without those services, the maintenance worker might lose up to $35,000, but the CEO might lose $500,000 or $500 million that year.  If you were the CEO, wouldn’t it be worth paying $100k or more toward schools, roads, public safety, and land record maintenance to protect the rest of your huge salary instead of demanding the lower income person from paying $5,000 more which might make your products too costly for them?  You can still afford your caviar and French wine.  In fact, the government might be spending money on your company to build the roads or create the materials.

If the republicans demand small government at a small cost, and then mostly campaign on platforms requiring bigger government in our bodies and bedrooms (anti-gay, anti-pot legalization, anti-abortion even when raped and under aged, etc.), then they need to leave government.  Why elect people to government who don’t believe government is a benefit?  Let people lead us who know government spending buys American made goods and materials, and builds our middle class which can then also afford to buy American made goods and services.  A strong American government also leads world foreign policy which ideally creates stabilization in the world which is good for everyone, rich or poor.

Economic Growth Goes to Top Management

The term “jobless growth” has been thrown around quite a bit in the last year to describe an increase in GDP and other economic indicators, but little growth in jobs.  How can this be?  If the country’s product continues to grow, and stocks continue their increase, how can there be so little hiring?

I see two things happening:  1) Many people have gained employment who were unemployed long enough to fall off job-seeker status.  2) A look at the earnings (salary, benefits, and bonuses) of top management of publicly traded companies shows most have increased their income, some with record setting incomes for the company or industry, even if they signed pink-slips in the past year.

Tax cuts given to America's richest without promise for job creation

U.S. republicans demanded extending the Bush tax cuts for the countries richest people saying they’d put the money into job creation, but the opposite has happened.  The same republicans also argued the U.S. government can’t create jobs, but the government employs hundreds of thousands of workers (jobs), directly increased hiring the past year, indirectly increased hiring through hiring contractors for new work, and the government buys vast amount of materials to repair roads and other infrastructure which was produced by working people.  Luckily for us, a large amount of stimulus funds remain to continue government-led job creation.

A very recent example is the situation in Wisconsin where Governor Walker (R) called a special legislative session after being sworn in.  they passed drastic tax cuts for corporations.  Soon afterwards, the governor and state republicans forced legislation to cut salaries, benefits, and bargaining rights of citizens paid 1,000% less than the leaders of the corporations which were just gifted tax breaks.  When democratic senators left the state in an attempt to thwart that legislation, the governor threatened layoffs even though these public workers accepted every fiscal demand from the governor.  Clearly, saving the state money wasn’t Governor Walker’s idea, nor was it to save or create jobs.  His plan was to gift his rich donors at the expense of public employees, state jobs, and the union members who didn’t support him in his race for governor.

Governor Walker had no problem laying off people (losing jobs) to give his supporters, who are paid millions of dollars every year even without promise from their companies to increase hiring.  Regardless of which party people associate with, they need to start voting the interest of their communities and not only the richest people in our nation who donate a large amount of the tax-cut money they save to continue secrative PACs and organizations to continue their gravy train.

One of the greatest tools republican donorship has is Fox News.  When the Bush tax cuts for earners over $250k were up for vote, Fox news anchor Gretchen Carlson of “Fox and Friends” said “$250k is just above the poverty line for many people.”  Is it really?  During the protests in Wisconsin, Gretchen and Fox’s Bill O’Reilly complained about the annual average salary plus benefits of $51k was part of the “lavish salaries and lifestyle enjoyed by Wisconsin teachers.”

How can Fox News make people believe that $250k (salary only, benefits not included) is just above the poverty line, and show great concern for these “poor people” just hanging on by a thread, then 2 months later make the same viewers believe Wisconsin teachers live lavishly on a combined salary AND benefits of $51k?  It has to do with people listening to sound bites fed to them in the present without stepping back to think about the picture as a whole.

I’m asking you and everyone else to pause, step back, and think about the entire picture before forming decisions, and then keep reevaluating those decisions.  Don’t stop thinking or become a drone for the sound bites you hear.  Don’t take what I say without looking into other news sources either.  Never rely on any one news source.  Look around and take it all in.

If most of the economic growth goes to the richest, and those people and corporations don’t create the jobs they never promised to create when they received all this money, then our economy will have fewer people able to buy what Americans make, and we’ll continue to buy the cheapest products from other countries.  A vote against the lower and middle classes is a vote against the United States.

WI Budget Surplus Before Governor Walker

Proud Look for a Bait and Switch

In November last year, during the end of a democratic Governor Jim Doyle’s term, Wisconsin had a budget surplus.  Incoming republican Governor Scott Walker called a special session for his newly republican controlled congress to pass new tax-cuts and a conservative healthcare reform innitiative.  The state government’s finance committee had to revise budget estimates in their report from surplus to large deficit after Walker and his republican congress passed these tax cuts.  Page 1 of the report connects this shortfall to the specific bills creating the defict.

After Governor Walker engineered budget deficits for the benefit of his supporters, he’s now demanding unions pay for his deficit if they supported his democratic opponent, Tom Barrett.  This is anti-democratic and all about awarding republican supporters and punishing democratic supporters.

As mentioned in my previous article, Union Busting as Political Punishment, much of the savings in Governor Walker’s budget hinges on refinancing the states debt.  Walker’s office says the bill must be passed by this Friday (2/25/2011) or the realized savings will be greatly delayed.  The only issue preventing the passage of this budget is Walker’s refusal to remove the union busting clause that saves no money.

Union Busting as Political Punishment

Over recent years, and during the current budget discussion, various unions representing Wisconsin teachers gave into cuts demanded by the governor or legislature because of state fiscal shortfalls.  Despite the acceptance of his fiscal cuts, Governor Walker is now threatening hundreds of layoffs if his union busting clause isn’t accepted.

This clause does not save any money, yet Walker is threatening the layoffs to help make up the budget shortfall.  If his new threat is true, then he was going to make these layoffs even if his full bill was accepted, and it highlights the fact that he is punishing unions that didn’t support his election, rewarding unions that did, and he’s sending a message to all unions to support him, or he’ll try to kill them if they don’t.

Walker’s spin machine is trying to tell the public the union workers are over-payed at the expense of all these poor citizens.  However, the union members are paid less than their counterparts in the private sector, and they’re accepting more cuts.  This low compensation has continued shortfalls in quality teachers available to work even while unemployment plagues the higher paid private sector.  Additionally, as teachers take more and more cuts, large businesses are complaining about increasingly fewer qualified employees to hire for innovative positions.

Basically, continuing cuts in education are creating continuing shortfalls in a qualified work force.  Maybe we should put more money into education to increase the output of a qualified pool of workers.  This is not the immediate issue at hand, but it is the long-term issue which the unions need to exist to get back the conceded cuts when the fiscal deficits are gone.

According to an NPR article, part of the governor’s deficit cutting plan is to refinance the state’s budget at lower interest.  This must be completed by this Friday in order for savings to start when planned.  For this bill to be passed by Friday, Walker only needs to concede one thing – remove the union busting clause.

If Walker does not remove this clause by Friday in order to get this bill passed, then it will be the governor who will have lost millions of dollars, not the unions.

2011 State of the Union – Real Leadership?

Barack Obama - White House Stock Photo

State of the Union addresses have been televised since President Truman.  The advent of radio & TV meant the SOTU address no longer gave direction just to congress, but also announced presidential intentions to the wider public.  Any President using this speech to speak only to his party base is not doing his job.  Regardless of who voted for him, a President must represent everyone in the country as well as possible.

I think President Obama did this very well.  He announced or furthered intentions grown from the democratic base, and he co-opted several issues grown from the republican base.  Our government’s job is to provide benefit to the country as a whole, not either party’s base.  Obama is leading this call, and I hope both major parties will come together behind him.

The Republican Response by U.S. Representative from WI Paul Ryan simply returned to rhetoric driven by old talking-points.  He continued with prefixes like the “failed stimulus”.  Did it fail?  The DJIA rebounded over 5k points, and we’re no longer dipping further into recession.

Republicans only offer tax cuts as stimulus.  Tax cuts only benefit people already earning money who, with a bleak economy, will hoard that money out of fear, not create new business and jobs.  Government spending does create jobs by spending it on new research and innovation (green technology) as well as roads, schools, managing our beloved land/property records, and paying doctors and nurses caring for our deserving veterans and first responders.

Ryan also said limited government, individual liberties, and free enterprise is what made America great.  Did he forget the high-taxed Eisenhower (R) years that built our country’s great infrastructure?  Does he include fighting gay marriage, Bush’s subsidies to oil companies, and fighting pro-choice as limited government favoring individual liberties?  This is contradiction pandering to his party’s base, not to the broader country’s citizenship.

Government has always directed money toward industries they want to grow.  Bush signed billions in oil subsidies which democrats tried to reverse in 2007.  Oil companies subsequently set world corporate profit records when the rest of the economy was falling.  Obama will redirect oil subsidies to clean energy innovation.  This will create jobs since the industry is in its infancy.  We will never be the world leader in the aging oil industry, but we could be the world leader in green technology innovation and manufacturing.  When developed, it will reduce our dependence on increasingly expensive oil.

Showing Unity and Ribbon Supporting Gabby Giffords

President Obama announced direction where money will be spent.  As an independent, I don’t follow the extremities of either major party, but I can follow our President who is trying to work with groups across our country.  Following his leadership will help small and large business alike, and new jobs will be created.

We need to get behind our President.  Stand together in his moderate stance or divided we will fall.

Tax Cuts vs. Government Spending

As David Stockman, the architect of Reaganomics explains in his books and articles, there is a time and place for tax cuts, but its use is limited and any political religion based on cuts is a perversion even from the original Reaganomics.  Stockman will also tell you Reaganomics was a failed policy that led to soaring deficits.  An Internet search on David Stockman will provide many articles, or read the middle of this article.

Stockman said the recently approved tax relief for the rich is misdirected, but was an unfortunate outcome of republicans holding all other legislation hostage without passing them.

The fact is, government spending does create jobs as well as return some control of the country’s financial might to the people who help earn it, the working class.  Without the working class, the country’s upper class would not exist, yet, it is the upper class controlling the purse strings and who often (not always) chooses raises for themselves while fighting raises for others.  As for tax burden, richer people find many ways of paying lower tax percentages while low to middle class families don’t qualify for most, if any, of tax breaks.  It’s just not true that we’re making the rich pay for everything.

Taxes pay for roads, hospitals, schools & universities, firemen, police, disaster relief, and all kinds of administrative support such as safe keeping of our land records so nobody can sneak land out from under another.  Taxes also support investment in industry.  Obama wants to spend money on repairing our aging infrastructure, and wants to redirect oil subsidies toward greener technologies so America will be a leader in this infant industry, not just other countries.  If you want to benefit even more from taxes, invest your business into American infrastructure or green technology so the government will pay you and will reinvest your taxes back into you.

Republicans are right to spend money on some industries, so let’s spend money on growing industries still in their infancy instead of spending it on aging, waning industries like oil.  Democrats are right to spend money on repair and improving our country’s infrastructure to benefit business and individuals now and in the future.  Republicans are right to put money toward war costs, but enough money needs to go toward taking care of our veterans, not more none-compete contracts for Halliburton.  They voted for war in Iraq with Rumsfeld saying it wouldn’t last 6-months, but they had no plans to pay for the residual costs.

The last 30 years show republicans are not conservative or small government when it comes to their party’s wish list, and they don’t want republican financiers to pay for it either.  However, we need to pay our expenses through taxes.  The fact is, the richer a person is in this country, the more they benefit from our country’s infrastructure, so they should pay more than the person working 2 jobs and just staying afloat.  Richer people have huge cushions to last through unemployment while the poor and middle class people have little to no cushion to handle unemployment.

The government helps maintain private spending by ensuring all families have some money to spend.  Private spending keeps our businesses afloat to continue providing jobs.  There is no way around this.

More Calling to End War on Drugs

This entry cites the following recent articles & videos:

1. New York Times – Peru Coca Production
2. Detroit Metro Times – Roots of the Fiasco
3. New York Times – DEA Unsure Who Is Who
4. New York Times – Mexican Drug Trafficking Violence
5. CNN – Former Surgeon General Calls to Legalize Pot
6. CNN via YouTube – Former Mexican President Says Open Discussion on Legalization of Marijuana
7. Huffington Post – Cops Pressured to Deny Legalization Support
8. Houston Chronical – Waging War Against War on Drugs (this is a well written opinion piece)

All these articles have good information.  Even information in the opinion article is supported by other articles.  Of these eight, I’d suggest reading #1, 4, 7, and 8 to get the most rounded set of information, and I’d put an emphasis on #7.

I’ve read similar articles about the widespread support of LEAP (Law Enforcement Against Prohibition) by police & judges.  As mentioned in that article, most law enforcement and judges can’t voice their opinion to legalize drugs until the day they retire.

The flip-side of this coin is the large number of people comfortably settled into their drug business that they vote against legalization.  Several states have supported medical marijuana, but that is in part because illegal producers can still make a profit through that service, but at reduced risk.  However, if marijuana were made fully legal, their profits would plummet.  Additionally, virtually none of the thousands of tons of marijuana coming in from Mexico show up in medical dispensaries so most people involved in that trade will vote against legalization.  This amounts to 10s of billions of tax-free dollars going to individuals, and often out of the country.

I’ve briefly stated what we’re losing in tax revenue on pot alone; now let’s look at the costs.  Article 8 tells us the easily accountable taxes spent on the drug war by the U.S. are about $50 billion a year.  Add that to the money spent by all the other governments we push to battle suppliers of our consumption.

For this discussion, I want to focus only on the legalization of marijuana even though, for many reasons, I agree with a growing number of people that all drugs should be legal.  Prohibition didn’t work for alcohol, violent crime greatly increased, and that is no different than we see in today’s situation.

Many of you might recall the government funded researcher who developed all kinds of study results pointing to the poor effects of marijuana and other drugs recanted all of his studies 3-4 years ago.  This was reported by all the major news sources.  After years of chiding by his peers at other labs for his scientific methods designed to get those results, he finally put together a large, long-term, federally funded study to look at the long-term effects of marijuana.  He found the marijuana using group showed no decrease in memory or increases in other negative health issues over the non-using group.  In fact, he found a slightly statistical decrease in cancer rates among marijuana users over the non-users, and those with cancer had better outcomes.  No government funded studies touting marijuana’s negative effects have come out since that time.

Marijuana and other drug enforcement takes desperately needed time & resources from deterring and investigating violent crimes.  Also, people convicted of violent crimes get out of prison sooner to make way for drug offenders.  Unfortunately, many of these violent criminals leave prison only to commit more violent crimes.

Prison overcrowding has led to the end of all mental therapeutic and other rehabilitation programs in most California prisons.  Other states are facing growing problems as well.  This means the violent robbers, rapists, and murders we sent to prison for rehabilitation and education get none at all, and they return to society more frustrated than ever, and with even less opportunities than before.

One final note on this issue is with the prison gymnasiums turned into high-occupancy bunk rooms, pent-up energy and stress has led to a drastic increase in prison riots and deaths.  We all know that some innocent people are in prison.  What if you or your child becomes one of those people killed in a prison riot for a crime committed by someone else?

By legalizing marijuana, large amounts of money and other resources become free to battle other violent crime, and taxes raised from its production and sale can go toward schools and other programs that might further reduce interest in its use.  Studies show most Americans now agree that marijuana is likely less damaging than alcohol, and as more states approve marijuana for medical use, it’s clear most people realize it has some positive utility.  Many people say the end of prohibition provided fuel that aided recovery from the Great Depression; maybe this is a good time for marijuana to help the current recovery effort as well.