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No more "Tax giveaways to the rich!"

Posted by Member of the Tribe on Monday, November 10, 2008 11:00:02 AM
I was contacted offline in response to Racist politics and why African Americans vote Democrat urging me to give our president elect a chance, because we should distribute the wealth in the "other direction;" i.e. away from "wall Street" and "the rich."

In my response, I have made an effort to separate fact from opinion

I agree that Obama should be given a chance; he is our president and if he succeeds, we all succeed. By "succeed," I am referring to the most of the post-nomination reversals he campaigned on in the fall (see A Marketing Triumph and other silver linings in the 2008 presidential election below), with the important exception of his proposed tax increases on "the rich," i.e., those earning in excess of $250,000, or $200,000, or $150,000, or $42,000 or whatever it has fallen to this week.

I don't agree with the (quite understandable) sentiment that Obama be given "as much respect as the Democrats showed Bush." Calling Obama a Nazi and unfavorably comparing his policies to the rape rooms, human paper shredders, torture chambers and mass executions of Saddam Hussein, to cite a couple of examples, would make us no better than Air [Anti-] America, Frank Rich, Maureen Dowd, and, well, OK most of the mainstream media and Hollywood.

Now from opinion to fact.

It is factually incorrect to assert that any transfer of wealth has occurred from poor to rich, or from "main street" to "Wall Street." Businesses create wealth (corollary: government doesn't), which is redistributed to the poor and middle class in five ways:
  1. job creation (salaries, which provide the opportunity for #2)
  2. investment in the equity of those businesses
  3. our "progressive" taxes on those businesses
  4. our "progressive" taxes on owners of those businesses
  5. redistribution of the proceeds of those taxes to the poor and, secondarily, to the middle class
Liberal critics of McCain's "Joe the Plumber" strategy (if you could call anything in his pathetic campaign a "strategy") charged that McCain was scaremongering because our system is already redistributive in favor of the poor. They were 100% correct as to redistribution. How much redistribution is ideal (or whether it was "scaremongering") is a matter of opinion.

Factually, Obama's repeated references to "tax giveaways to the rich" do not jibe with reality. There has not in fact been one penny of "tax giveaways to the rich." They would be more accurately referred to as tax relief  for the rich, since the money at issue was earned by them in the first place. The question is: how much of these earnings should the government be entitled to confiscate. That is a legitimate matter of opinion on which we can all argue, but to put the argument in proper perspective, let's return to the facts.

Factually speaking "the rich" pay virtually all of the taxes. The top 1% of earners account for 40% of all revenues, up from 20% just 20 years ago. The top 10% of earners account for 70% of all revenues. The bottom 40% account for (read this twice) zero - zip - nada. They account for almost half of the 95% of whom Obama wants to provide "tax relief" (mainstream media - you would make George Orwell proud)!

How can this be? Consider what the Bush and Reagan tax rate reductions had in common. They resulted in the largest revenue increases in history! Tax rate reduction results in wealth creation, resulting in more revenue (i.e., not despite the lower tax rates but because of them). Since we have progressive tax rates, who do you think accounted for all those increased revenues? The poor?

It's worth digesting this: "the rich" paid more taxes under Bush than under Clinton. They also accounted for a greater proportion of those taxes. And all this despite Bush's "tax giveaways to the rich."

Again, factually speaking, there is no way to provide any significant "across the board" tax relief without disproportionately benefiting "the rich." They are the ones who, for all practical purposes, pay all the taxes in the first place.

So the phrase "tax giveaways to the rich" fundamentally runs counter to reality on two levels, because the policies referred to:
  1. affected how much the rich were giving away to everyone else, not vice versa
  2. increased the amount the rich were giving away to everyone else
As to my opinion: no matter how much opportunity we create, the poor will always be with us. Policies that reward individual effort (i.e. low taxes and regulation) must always be balanced with compassion (redistribution). The perfect place on the dial will always be a matter of debate and may objectively shift from time to time.

We do know that twisting the redistribution dial too far fails on three levels, by:
  1. destroying the very wealth creation that offers the only long term hope of helping the disadvantaged
  2. creating and perpetuating a cycle of dependence and poverty (see Racist politics below)
  3. concentrating too much power in government, which has never, not once, not even a little bit, resulted in anything anyone (with the possible exception of Planned Parenthood) would call "good"
Finally, we should become very concerned when the siren song of class warfare is chanted so stridently. This is the same state-as-provider-of-all, scapegoating ("fat cats" "Wall Street" "bankers" stealing the sweat of the workers) we've heard before in 1917 Russia, 1924 Italy and 1934 Germany. The dreams of a greater society paid for by "contributions" from the "controllers of capital" never seem to work out very well for Jews, or, for that matter, anyone else
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Beyond racism

Posted by Member of the Tribe on Sunday, November 09, 2008 10:45:30 AM
Enquiring minds want to know: does the Obama presidency herald the end of racism in America (or the beginning of the end or the end of the beginning)? Did it just confirm it, to the extent that 53% of the electorate were presumably willing to vote for Obama the day before (and the day before that, etc.), not to mention the the percentage of the McCain electorate who pulled the lever for non-racist reasons? Or will the mainstream media conjure up a "Post-Bradley effect," in which white supremacists secretly voted for Obama to mask their racism?

Similarly, can we find a silver lining in the mainstream media's no-longer-a-secret Obama swooning? Is it proof positive that at least everyone in the media (with the obvious exception of the "haters" at Fox news and Rush Limbaugh) has transcended racism? Or is it part of the soft racism of lowered expectations?

Shelby Steele addresses these issues in his L.A. Times piece

Obama's post-racial promise

Barack Obama seduced whites with a vision of their racial innocence precisely to coerce them into acting out of a racial motivation.
http://www.latimes.com/news/opinion/commentary/la-oe-steele5-2008nov05,0,6553798.story
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A Marketing Triumph and other silver linings in the 2008 presidential election

Posted by Member of the Tribe on Saturday, November 08, 2008 6:44:54 PM
The 2008 presidential election was a marketing triumph, and this is exactly what should give us hope. Forget the $600 million to $84 million campaign finance disparity (and put aside the questionable source of much of the $600 million). Forget the ACORN voters, served up courtesy of tax deductible contributions as well as "redistributions" from the "rich" (i.e., productive taxpayers). Forget that the media devoted more resources to digging up dirt on Sarah Palin in 2 months (and Joe the Plumber in 2 weeks) than they devoted to fact checking the president-elect in 2 years. And defer (at least for a couple of paragraphs) the role of mainstream media bias. Among many other things, the election of Barack (can we use his middle name yet?) Obama was a testimony to the power of marketing.

BHO ran hard away from his past and his base. He ran past the center to the right as a tax cutter, oil driller, pro-Israel, anti-gay marriage fiscal conservative. He denounced Reverend Wright and found Bill Ayers' actions (the ones occurring before Obama was born) "repugnant." He said he would not tolerate a nuclear-armed Iran. If his poverty stricken illegal alien aunt was violating immigration laws, than she should be treated "like any other person" because "we are a nation of laws." Economically disadvantaged African Americans should take more individual responsibility for their lives. He came out foursquare against "those who would divide us by race." A regular Reagan clone!

And, other than selecting the one ray of sunshine in his otherwise gloomy campaign for his VP, McCain certainly didn't help himself by muddying his message. He blamed the inevitable burst of the Democrats' multi-billion dollar subsidized mortgage welfare program on "greedy Wall Street fat cats." He wanted mass amnesty for illegal aliens and more government intervention to address the indisputable "man made global warming." He called for more government bailouts and more regulation to protect us from "Wall Street greed." Not exactly a focused marketing message for a Republican!

Media bias? Just because 95 percent of the media self-identify and vote as liberal Democrats? Who says they can't put that aside and call it fair & square, like they learned in journalism school? Could you honestly say you knew for whom Keith Olbermann, Katie Couric or Chris ("chills running down my spine") Matthews was voting? And how can anyone selectively cite ABC, NBC, CBS, CNN, MS-DNC, taxpayer-funded PBS, Newsweek, Time, the New York Times, Washington Post, L.A. Times, just about every broadcast and cable station and just about every major newspaper and newsmagazine - when Fox News consistently gives Hannity more time than Colmes? To say the mainstream media was "in the tank" for Obama is as unfair as accusing announcer Johhny Most of "homering" for the Boston Celtics.

So, unlike my fellow selfish, un-neighborly, big oil, Wall Street "fat cat" Bible & gun totin' bitter McCain voters, I am not despairing. No, it's not just because this country was great enough to survive Jimmy Carter. It's because the number one marketing rule is: marketing must reflect reality (i.e., there must be a "there" there). So the good news is perhaps our President-elect has really divorced himself from Ayers, Alinsky, Farrakhan, Wright, Phleger, Khalidi and his other mentors, spiritual leaders, advisors, financial backers (and financial beneficiaries) who believe that the United States is a hateful, racist, greedy country and the source of the world's evil. Perhaps he has seen the light and become a born-again post-racial unifier (and Reagan clone). If that is true, we may have ushered in a new day of post racial-divisions and post politics of victimization, less big government  intrusion, lower taxes, energy independence and true empowerment for the economic underclasses.

And if the Obama campaign brilliantly applied nearly all the rules of marketing - rules #2 through 687 - while ignoring the first, well, the American people don't like to be hoodwinked
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