Stiglitz says, "Inequality Is Holding Back the Recovery: The re-election of President Obama was like a Rorschach test, subject to many interpretations. In this election, each side debated issues that deeply worry me: the long malaise into which the economy seems to be settling, and the growing divide between the 1 percent and the rest - an inequality not only of outcomes but also of opportunity. To me, these problems are two sides of the same coin: with inequality at its highest level since before the Depression, a robust recovery will be difficult in the short term, and the American dream - a good life in exchange for hard work - is slowly dying." And all of this could have been avoided - if our leaders had wanted that.
Sam Seder interviewed Eliot Spitzer Thursday on The Majority Report, on the heels of Lanny Breuer "stepping down" from his job after the Frontline exposé, "Untouchables".
Looking at comment threads at the bigger sites in posts related to banksterism and the financial crisis, I see a lot of people still believe that some weird liberal law forced banks to lend money to people who couldn't afford to pay back the loans. This is, of course, a lie. Liberals wanted to pass laws to prevent one aspect of redlining, the practice of denying loans to people who could afford them, or charging them extra for financial services, in selected localities (most notably based on the racial or ethnic make-up of that area). The banks retaliated by hoodwinking people into believing they could afford loans they could not, and then waiting for the government (i.e., the taxpayers) to bail them out when those loans all started to fail. (It should also be noted that, while this was referred to as "the sub-prime crisis", it wasn't sub-prime loans that began to fail first.)
The CEO's got together their own little catfood commission to "fix the debt". But what if everyone just stood right up to The Great Austerity Swindle? "But, what if we say to these people, well, 'the job creators' aren't making any jobs? That's a fact! They give all kinds of excuses, but the truth is that they have no sales, so they have no incentive to create any more jobs. On the other hand, the more we lower their taxes, the more money they have sitting idle, and the more they have an incentive to use that money to invest in financial manipulation schemes rather than jobs. So, why not tax them at extremely high rates on net profits and provide them an incentive to lower their net profits by spending more of their gross profits on tax-deductible business expenses like employees and business expansion? Why won't high taxes on them do more to create jobs than lower taxes? Didn't we have far lower unemployment rates when marginal tax rates were sky-high, than we have now when they are a pittance on the wealthy?"
Just to make life even more annoying, I'm allowed to see stuff from Comedy Central, now, but not at the .com URL. So all the links from blogs are still dead to me, and if I want to see something, I have to go to the .co.uk page and search through the listings to find that same show. Which was nice when I went to the interviews from The Daily Show and it opened up to the full Neil Young interview, but it seems the thing I was actually looking for, the interview with Austin Goolsby that is available to Americans at the US CC site, hasn't been posted to the UK site. Bummer. But I had been directed there from a useful post by Dan Crawford on Taxes and job creators at Angry Bear linking mainly to a Bloomberg piece that said: "The typical business startup (think Joe the Plumber) begins with an initial stake that has been saved or borrowed, and 97 percent of small-business owners make less than $250,000 a year. It is a good bet that when Bill Gates, Steve Jobs and Larry Page were creating their new businesses in their proverbial garages, they weren't giving much thought to the tax rate they would have to pay if they struck it rich," and also noted that the bankruptcy bill actually made it significantly riskier to start a new business. Since small businesses are where most of the new jobs are created, that's a direct hit on job growth. (Also at Angry Bear, more on the fallout from "The Untouchables" and a pointer to Glenn Greenwald's article on same, and a post on Social Security data mining.)
Anonymous declares war on the United States Department of Justice.
Our favorite teacher: "On this third anniversary of Howard Zinn's death, we remember the extraordinary teacher and visionary who imagined that education - like history - should serve the future. Through his life and labor, Howard Zinn urged us to 'teach outside the textbook,' to have confidence in our capacity to make a difference. The rest is up to us."
Rah, it's Quantum & Woody online! (This is one of my favorite comics ever.)
"So, why not tax them at extremely high rates on net profits and provide them an incentive to lower their net profits by spending more of their gross profits on tax-deductible business expenses like employees and business expansion?"
ReplyDeleteTaxing net profits discourages net profits? It sounds like you are taking the right wing frame for this. Bad Avedon.
Let's start by taxing capital gain income (i.e. income from speculation/gambling) at the same (or higher) rate as ordinary income. Then disallow capital loss carryovers and carrybacks, and even deducting losses from one losing bet against your taxable gains from the winning bets.
Then disallow tax deductions for interest expense. Lending/leverage is just another form of investment. You don't get tax deductions for your dividend payments to shareholders (actually, you do in some cases, but those should be abolished too). So tax policy favors lending over direct investment (i.e. gambling where the borrower gets all the upside, but has very limited risk for the downside, since much of that risk goes to the person lending the money, who then transfers the risk to the taxpayer if they are "systemically important")
Tax the money when it is earned: When you give endless "deferrals" that basically give accelerated tax benefits that are supposed to delay the date when the taxes are due, you are basically letting them off of taxes when they have money, and letting them have the tax bill when they may be broke, and you end up begging for some of those taxes in bankruptcy court.
Tax the money to the "person" who earns it. No more "flow thru" entities like partnership and S corportions. These companies are set up to protect the investors from the legal claims others may have against the company. But the investors and officers can end up taking their money out of the company, and creditors and consumers and other wronged parties are screwed. If an entity is entitled to the protections of limited liability for investors, whether they are a LLP, LLC, or S corp, tax them all the same, just like a corporation.
When one corporation is owned at various levels (20%?, 80%? I'm fuzzy) by another corporation, they get a deduction for dividends paid to those corporate owners. Once again, this is a racket to protect and partition the organization's assets from legal creditors and consumers, and yet they get those protections tax free, or at greatly reduced rates.
Take away all the tax incentivised complexity in the tax code and in business structures, and they will disappear quickly. Instead they are growing exponentially.
Well, he might be "our favorite teacher" but I daresay what Zinn taught so passionately and accessibly for decades resonated very little with a majority of liberals. His or Chomsky's or MLK Jr's trenchant, convincing class rhetoric simply baffles the factionalized ID-politics crowd, not to mention those comfortable enough to forget about those who never made it into the middle class. Right-wing conservatives and neoliberals have been running the country for over three decades. The latter are happy to coopt and divide their supporters, obfuscating any unifying cause. All the while, there’s nary a left to combat that ascendant right. If you want FDR redux, you need to oppose the right with an authentic left. FDR was only possible b/c of the tremendous efforts and sacrifices of the left. Countering batshit neo-fascist language with DLC/NDN talking points leads to, well, where we are, which is soooo not a good place to be.
ReplyDeleteI think that a lot of people don't actually know what liberalism is.
ReplyDelete