Why is there a Federal Deficit?

The rich hardly pay any taxes. That’s why there’s a federal deficit, at least in part. Let’s get something straight; corporations are rich people, just ask Mitt Romney. Okay Mitt is an idiot. Always has been. We all know corporations are not people. But they are tools of the rich that enable them to redistribute income from the 99 to the 1 percent.

Corporations have bought off tons of politicians of both political parties with their tax breaks, such as Wall Street Fetch Boy Ron Wyden, supposedly a senator from Oregon, but on matters of income redistribution, the senator always sides with the Wall Street one-percenters.

Corporate profits are currently at an all-time high (while worker wages as a percentage of the economy have plummeted to record lows–Thank you Senator Wyden). Guess what? Corporate income tax revenue is going to be about 1.5 percent of GDP this year, below the recent average and far below the amount raised by the tax just a few decades ago. Just look at the chart below, back in the early 1950s, corporate profits were taxed high enough that they were about 35 percent of federal tax revenues.

So Mitt? Why aren’t these people taxed at a higher rate? The answer is simple. Wall Street is a Ponzi scheme. If corporate profits don’t always go up in the long-term, they would either stay stagnate or go down. In which case, Wall Street would go down with corporate share prices. The Ponzi scam would self-destruct.

As income has been redistributed for the last 30 years, the demand for goods and services has shrunk. That means corporations have to boost income in other ways than selling more of their stuff. So they ship jobs overseas and pay legislators big bucks to pass legislation allowing them to reduce their tax burden. That’s what has occurred over the last thirty years. That means more money flows to the 1 percent via higher profits, dividends and share prices. The rest of us pay the price, such as reduced government services, lower paychecks, rotting schools and more lumpy streets. That you Senator Wyden.

We’ve got idiots like Wyden talking about cutting Medicare, Medicaid and Social Security benefits for the aged and the infirmed. That’s crazy. Especially since the Social Security Trust Fund has a $2.5 trillion surplus that earns about $118 billion a year in interest.

Let’s solve the problem easily. Tax corporations more, like in the good old days, and watch the Wall Street Ponzi Scam collapse. We’d be saving our livelihoods, our economy and a lot more.

As the Century Foundation noted in the chart below, the corporate income tax, as a share of total government revenue, used to track reasonably well with corporate profits. But in the last decade, the two have become decoupled:

Corporate profits are up, dividends are up, share prices are up, and corporate tax payments are down, down, down. Anybody see a relationship here?

By the way, the video below is when Mitt the Twit said corporations are people. But Dumb Dumb never figured out in what hospital any of them were given birth.

Read Full Post »

Following Republican Economic Plans Will Do What?

Republicans want to cut the deficit while giving tax breaks to the rich. They want to cut social security benefits even though the Social Security Trust Fund has a $2.5 trillion surplus which collects $118 billion in interest per year. They want to hack away at unemployment benefits, Medicaid, Medicare and just about anything that helps the poor and middle class. All of this, they say with a strait face, so as to cut the deficit, which has always grown exponentially under Republican presidents since Ronald Reagan. Meanwhile, like Reagan, they think they can cut the programs that benefit the masses while increasing military spending that primarily benefits the 1 percent, and they want to give those same rich folks another tax cut that will, they claim, reduce the deficit. Unfortunately for Republicans, all of those tax reductions for the rich since Reagan destroyed jobs and created the economic wasteland we now have. They call this policy “austerity.” Europe tried it a few years ago. Look below to what’s happened to the European economy since the Europeans tried “austerity.” Look what happened to the USA since the USA under President’s Bush and Obama didn’t try “austerity.” The Republicans know austerity will tank the economy. That’s the only reason they want the austerity program. They want mass misery.

Read Full Post »

Soak the Poor: Mitt Romney’s Real Economic Plan

Mitt Romney plans to redistribute income and benefits from the poor to the 1 percent should he become president in January. Click the link below to see how he’ll eliminate income and benefits for the poor in order to give already rich one percenters a tax cut that will destroy more jobs and redistribute more income from the 99 to the 1 percent.

Click here–Soak the Poor: Mitt Romney's Real Economic Plan–MotherJones

Read Full Post »

A Detailed Analysis of Mitt Romney’s Tax Plan

Besides bankrupting the USA, We don’t know much about Mitt Romney’s tax plan; but an analysis by the Economic Policy Institute of what little we know of his plan reveals that Romney plans will raise taxes on the middle class and lower them on the ultra rich. Click the link below for the details of the plan from the Romney team.

Bankrupting the USA

Read Full Post »

Mitt Romney’s Budget Plans Would Destroy Jobs

According to a study by the Economic Policy Institute (EPI), Mitt Romney’s budget plan would destroy jobs.

His plan includes cutting taxes on the rich. Those kind of reductions destroy jobs because CEO’s seek to get investors with the newly available cash to purchase their stocks and bonds. That means a bidding war usually begins among CEOs. The best way to attract the cash is to raise profits, dividends and share prices. And the best way to do that is to cut jobs, wages, salaries and other employee compensation, and that typically means sending jobs overseas. The EPI study does not count this reality in ascertaining the certainty that the Romney plan will kill jobs in this country.

Romney’s plan is simple enough. Redistribute income from the 99 to the 1 percent by cutting taxes on the rich, and paying for the reductions by killing government jobs. People will be fired so the rich can have more tax cuts. Great Plan! Of course, those jobs have a multiplier effect throughout the economy; they support other jobs in the private sector, and so the EPI study understates the jobs losses under “Dumbed-Down Wall Street Mitt the Twit Romney.”

The gist of the study is thus:

“* The budget plans put forward by Mitt Romney would lead to small job gains of 87,000 in 2013 and a loss of 641,000 jobs in 2014, relative to current policy, if his proposed tax cuts were fully deficit-financed.
* If some of Romney’s proposed individual income tax cuts were revenue-neutral (he has said that they would be, but has not specified what “base-broadening” adjustments he would make to the tax code to accomplish that), his plans would instead lead to employment losses of 608,000 in 2013 and roughly 1.3 million in 2014.
* The weaker job growth and outright job losses under the Romney plan are driven by his proposal to cap government spending at 20 percent of gross domestic product (GDP), a move that implies very large cuts to overall spending.”

Who would promote job growth most in the near term?–Economic Policy Institute

Read Full Post »

Mitt the Twit Romney Requested Several Years of Tax Returns From His VP Picks!

Talk about hypocrisy! The campaign of Wall Street Mitt the Twit Romney requested several years of tax returns from each person that was being considered for his vice-presidential running mate. Mitt will only release his last years return. By now everybody should know that Mitt the Twit won’t release his tax information because he didn’t pay any, and it is likely he received tax rebates on taxes he never paid, like a lot of corporations. This is what Mitt is likely hiding.

Click the link below for the whole story

Romney Campaign Requested Several Years of Tax Returns of VP Picks–Yahoo news

Read Full Post »

America’s 10 Largest Corporations Paid 9 Percent Average Tax Rate Last Year

America’s 10 most profitable corporations paid an average corporate income tax rate of just 9 percent in 2011, according to a study from financial site NerdWallet reported by the Huffington Post. The 10 companies include Wall Street banks like Wells Fargo and JP Morgan Chase, oil companies like ExxonMobil and Chevron, and tech companies like Apple, IBM, and Microsoft.

Low tax rates help those corporations to redistribute income from the 99 to the 1 percent; the later hold most of the stock and bonds of those companies. Those low tax rates have been engineered legislatively, thanks to some corporate Democrats and corporate Republicans who are easily bought off.

America's 10 Largest Corporations Paid Only 9 Percent in Taxes

Read Full Post »

Where Have All the Good Jobs Gone?

John Schmitt and Janelle Jones of the Center for Economic and Policy Research reached a conclusion from their research. Their conclusions are incorrect, but the information is still impressive. A synopsis is below.

“The U.S. workforce is substantially older and better-educated than it was at the end of the 1970s. The typical worker in 2010 was seven years older than in 1979. In 2010, over one-third of US workers had a four-year college degree or more, up from just one-fifth in 1979. Given that older and better-educated workers generally receive higher pay and better benefits, we would have expected the share of “good jobs” in the economy to have increased in line with improvements in the quality of workforce. Instead, the share of “good jobs” in the U.S. economy has actually fallen. The estimates in this paper, which control for increases in age and education of the population, suggest that relative to 1979 the economy has lost about one-third (28 to 38 percent) of its capacity to generate good jobs. The data show only minor differences between 2007, before the Great Recession began, and 2010, the low point for the labor market. The deterioration in the economy’s ability to generate good jobs reflects long-run changes in the U.S. economy, not short-run factors related to the recession or recent economic policy.”

The reason why so many good jobs are gone is simple; they’ve been redistributed to the rich. Enact a free trade treaty, ship jobs overseas. The difference between the old higher wages in the US and the new lower wages is pocketed by the affluent via higher corporate profits, rising dividends and surging share prices. This income redistribution scam is achieved by manipulating the political markets, i.e. purchasing the rules of the game. That’s precisely how the 1 percent have stolen nearly 30 of the total national income compared to about 8 percent back in 1980.

When the jobs are shipped away and the income from them is redistributed to the 1 percent, opportunities are lost for the rest of us, and more so than just the loss of the jobs. When those jobs are exported via bribed-enforced legislation, we lose our tax base and government jobs go away, like police, firefighters and teachers. There are less opportunities for accountants, mechanics and attorneys in government.

And illegal free trade treaties are just one way the one percent manipulate the legislative process to achieve income redistribution from the 99 percent. There’s a ton of other ways. Deregulation, for example, allows corporations to jack up the prices they charge at will. The difference between what prices would be under real competitive conditions and the manipulated prices go into the pockets of the rich via the same route as free income redistribution treaties.

Related Stories

Wall Street Twit Romney Wants to Use Tax Policy to Redistribute Income From the 99 to the 1 Percent

Income Redistribution–That's Why the Federal Deficit is So Big

US Poverty Has Increase As Income Is Redistributed From Working to Rich People

Nafta on Steroids; The Trans Pacific Free Trade Income Redistribution Treaty

Where Have All The Good Jobs Gone? Center for Economic and Policy Research

Read Full Post »

Mitt the Twit Didn’t Pay Any Taxes For Ten Years?

Mitt Romney claims he paid taxes for the last ten years, but he won’t release his taxes. Mitt is reported to be worth more than $250 million. Nevada Senator Harry Reid claims that he has been told by a Bain Capital investor that Mitt the Twit failed to pay any taxes during the ten years before last. Now it appears that Wall Street Mitt the Twit Romney won’t release his taxes because he didn’t pay pay any during the last year. Let Mitt the Twit prove Reid wrong. He’s a parasitic liar. Let him prove he’s not. Rachel Maddow reported on this. Click the link below for the complete story.

Click here for the video

Read Full Post »

The Middle Class Is Shrinking. Is it because of tax cuts for the rich?

Tax cuts for the rich are destroying the American middle class. When the rich receive their tax cuts, CEO’s find ways to attract that cash to their stocks by increasing their profits. Rising profits normally mean increasing dividends and share prices. Investors are inclined to sink their newly available tax money into investments with higher rates of return.

That’s why CEO’s race to ship jobs overseas, create jobs overseas and place downward pressure on the compensation of their US employees. The difference between the old wages and the new is redistributed into the pockets of the already affluent via higher dividends and share prices.

This allows the 1 percent to purchase more legislation that redistributes even more income from the 99 to the 1 percent, such as free trade treaties and deregulation. Free trade treaties result in more and more jobs being shipped oversea, or created over there rather than here. The difference between the old and new wages goes into the pockets of the rich.

The demand for goods and services has declined in the US because less people have money to buy stuff, unless they’re using their homes as ATMs during a housing bubble. Once that bubble burst, the demand sector was squashed, meaning less jobs can be created, and there’s still downward pressure on middle class wages and salaries.

The process means the destruction of local bases, layoffs of teachers, fire fighters, police and other government employees. The economy begins to collapse in slow motion over a period of several years. Only the New Deal and the Great Society programs hole the economy up.

That’s why, “In 1979 the middle three household income quintiles in the United States—that is, the population between the 21st and 80th percentiles on the income scale— earned 50 percent of all national income. But by 2007 the income share of those in the middle shrank to just 43 percent. Between 1979 and 2007 the Gini coefficient including capital gains, in the United States, climbed from 48 to 59, ranking the United States in the top quarter of the most unequal countries in the world.”

Tax cuts for the rich are also why the 1 percent received 93 percent of total US income growth from 2009 to 2011.

See Related Story

The Shrinking Middle Class–From The Center for American Progress

Read Full Post »