Thursday, April 5, 2012

Tax Increases by another name

I'm for sale again; but this time,
it's going to cost you a lot more!

Click here for related article [Washington Post]

Today's editorial page in the Washington Post features Harold Meyerson -- their weekly columnist -- as he condemns Wall Street for opposing Obama in this election -- an odd posture since Wall Street did such a marvelous job of funding Mr Obama's campaign four years ago.

It was barely enough to cover AIG bonuses

We have no objection to the SEC rounding up the executives of Goldman Sachs and tossing them into those FEMA camps the Administration has been quietly constructing in remote parts of the country -- to house terrorists and dissidents.

In fact, we'd prefer it.

Meyerson, vice-chair of the National Political Committee of the Democratic Socialists of America, inherited his Marxist philosophy from his parents who managed California's Socialist Party of America.

The price of GS support in 2008

Four years ago, Meyerson couldn't gush enough good things about Wall Street when it supported Obama.

He still supports Obama's Socialist agenda, but now claims it is Wall Street that is creating Mr Obama's "class warfare" program.

The Administration's mantra is that 1% is exploiting the other 99%; we've now experienced the Community Organized Occupy Wall Street Movement for nearly a year to highlight his "Class Warfare" movement.  With that emotionalism as a backdrop, Mr Meyerson will now join the MSM propaganda movement to "reform" the tax structure to make it more "equal".
In his column, Meyerson zeroes in on the tax rate investors pay on their income -- i.e., the capital gains tax [15%] vs the 35% paid by salaried workers.  

Those on salary don't experience that risk, except when the government causes the economy to falter and their companies fail.

Investment Risk = Profit/Loss
What Meyerson chooses not to disclose is that the Capital Gains tax is levied on people who earn money by risking their own capital for profit -- or loss.

High risk often means high gain; it also means a trader -- or his clients -- can be completely wiped out by a Market aberration, such as when Senator Schumer [D-NY] announced that Lehman Brothers was virtually insolvent -- causing a run on its assets and on the rest of Wall Street.

The result?  An investor panic sell-off that wiped out the retirement investment savings of  Middle Class Americans, plunging the US into financial collapse.

Note, we say "Middle Class Americans" since that is the group most inclined to invest in retirement accounts such as 401Ks, and they are taxed at 15% on the dividends and profits of those retirement accounts.  So, now we're talking about more than just a few greedy Goldman Sachs executives, we're talking Middle Class America.

Middle Class conversion to Poverty
But, Mr Meyerson doesn't mention Middle Class America as his target is "tax reform" [read Tax INCREASE for everyone] -- since the elimination of a tax incentive translates into a tax increase.

[The Democrats' agenda has been to systematically eliminate both tax incentives as well as deductions (e.g., the mortgage interest deduction) to fund social welfare programs.]

Of course, Meyerson's personal income and benefits likely fall into an entirely different tax structure, one in which he pays little or nothing, while he allows his trust accounts to furnish him with opulent lodging, a lucrative expense account, and luxury transport.  He is what we call a Limousine Liberal.  We won't see his tax structure altered since it does not entail "income" but rather his "expense account".

But, the main point of Meyerson's Socialist diatribe is to restructure the tax code to
1) increase taxes across the board, and
2) remove incentives for individual investors, thus undermining Capitalism in the process.
Ultimately, the carefully orchestrated and publicized Occupy Wall Street Movement and Mr Obama's Class Warfare agenda is designed to create a stage for Mr Obama to tout a Marxist/populist platform of "tax equalization" for this year's Presidential election.  The USSR was so successful, and it worked for Hugo Chavez and Fidel Castro, so why not here in the US.

George Orwell captured the essence of the concept when he coined the phrase in Animal Farm:
"All are equal; but some are more equal than others."

Mr Meyerson is indeed More Equal than others.
He influences how the rules are made as he promotes Socialism; but, when it displaces Capitalism, he won't be changing his lifestyle in the least because he will continue to be "More Equal."

Workers of the World unite!