Rush Limbaugh Repeats The Rich Man's Lies: Middle Class Has "Bulk Of The Money"

Here:

Where this is all going to end up, I'm pretty sure -- we'll see if I'm right; won't be too long, maximum next year sometime, maybe two years -- where this is all going to end up is that the middle class is going to get soaked.  The middle class is going to see their taxes go up, and the reason is, that's where the bulk of the money is. 

You could confiscate all the money the middle class has and run the government for quite a while.  Much longer than if you confiscate all the money the rich have.  There's a reason why the rich are called the top 2%.  There aren't very many of them, folks.  They're only the top two, the top 1%.  And the idea that 98% of the country is not going to have a tax increase under this president is absurd.  Everybody is going to see a tax increase under this president, because his objective is to shrink the private sector and expand the government so that the government becomes the primary source of prosperity and benefits for the vast majority of people.

In 2011, the poorest Americans, those making between $0 and $20K, had total net compensation of $501 billion in the aggregate. The so-called middle class, those making between $20K and $75K per year where net compensation aggregates every $5K up the income ladder constitute piles of cash in excess of $200 billion each, had total compensation of $2.9 trillion in 2011.

The income tranches of the middle are what greedy liberal tax-farmers focus on, as do disingenous rich people, because they stick out like a sore thumb, representing as they do the largest individual tranches for ordinary income purposes and constituting an unbroken line of 11 of them just begging to be ogled. See them here for yourself. You will not find any tranches among the so-called rich in excess of $200 billion. But they make a lot of money nevertheless.

Add it all up and everybody making beyond $75K per year in 2011, which includes the upper middle class, if you piled all their net compensation for Social Security purposes together, would total another $2.8 trillion, just shy of the middle's $2.9 trillion.

If you think this proves Rush's point, you would be wrong. Such net compensation isn't all there is to it, not by a long shot. It's much, much more complicated, and obscure, than that. And that's the way rich people like it. If you can't see their income you can't know how rich they are and they can thus escape becoming a target. That's why so many rich people, and their advocates like Bruce Bartlett who want to tax the middle class and deflect taxes from themselves, insist so strongly that they are middle class just like you.

While net compensation totaled about $6.2 trillion in 2011, personal income was more than twice that. The Bureau of Economic analysis, here, reports that personal income was $12.95 trillion in 2011.

People like Jeffrey Immelt, Jamie Dimon, Mitt Romney, Warren Buffett and Bill Gates receive tons of income from stocks, bonds, capital gains, dividends, rents, royalties, et cetera et cetera et cetera, adding at least another $6.75 trillion to that $6.2 trillion in net compensation for Social Security purposes in 2011.

To be sure, lots of people who aren't the very rich receive such income, too, but there is no way on God's green earth that there are enough of them in the so-called middle receiving it to say that the bulk of the money is in the middle. The middle class would like to be receiving the bulk of its income as unearned income like the investor class does, but it doesn't for the most part. It works for its money (unless you're a government employee).

No matter how much the boob with the microphone and the subscription to The Wall Street Journal tells you otherwise, the bulk of the money is not in the middle, most people know it, and that's why Obama is succeeding with his class warfare rhetoric. He has picked his targets, personalized them, polarized them and frozen them, and all the rich can do, because there aren't enough of them, is surrender (Warren Buffett), create diversions (the home mortgage interest deduction flap) or tell lies (The Wall Street Journal).

It really is quite pathetic that we do this to rich people in America and pat ourselves on the back for it. It's actually disgraceful in a country which claims to believe in equal treatment under the law that a wealthier earner is discriminated against because we say he must pay taxes at a higher percentage rate on his ordinary income than a poorer earner must pay. And we feel guilty enough about it that we then turn around and create exceptions to these unjust tax rules when taxing income which is not ordinary. Is it any wonder then that more than half of the personal income in the country has fled for refuge to be classified as other than ordinary? The founders thought a tax was equal only if everyone in the country paid the same amount. This consensus necessarily kept federal taxation low and infrequent because the great masses of people could not afford to pay very much.

The least we could do in homage to that old idea of America would be to tax everyone's income in the country in similar fashion, at one low rate, making no distinctions between the income from a job and the income from an investment. Of course, that would mean a pretty low rate compared to what's exacted today, and would necessitate some pretty drastic cuts to spending. A 10% tax on the personal income of the country of $13 trillion in 2011 would have yielded only $1.3 trillion in revenues, far short of the $3.8 trillion or so we spent.

And that, as we on the right keep saying, is where the real problem lies. Unless we slay the spending monster, there will never be taxation equality in America.

43% More Housing Destroyed By Hurricane Sandy Than Katrina

Obama Seen Helping Hurricane Sandy Victims

Story here:

305,000 housing units have been destroyed by Sandy compared to 214,000 in Katrina.

Austin, MN, Hires Part-Timer To Save $18K On "Benefits"

"Benefits", as in health insurance.

The guy will work 30 hours per week and make $60K a year, but will get no benefits.

Story here:

He will not receive fringe benefits of pension, health insurance, life insurance or disability insurance. ... With the hiring of Erichson as a flex-time employee, the HRA [Housing and Redevelopment Authority] will save about a total of $38,000 ($20,000 in salary and $18,000 in benefits). The arrangement is planned to be revisited after one year of employment.

Yeah, at which time he'll be cut to 29 hours per week.

Capisce?

Of 7000 Banks, 3500 Need Recapitalization, 2000 Need To Sell

So note various experts in this story by Stephen Gandel for Fortune, who concludes:

Mortgage rates are about one percentage point higher than they would be if we had more competition. Apply that to all mortgages, and that higher interest rate costs consumers about $100 billion a year in extra interest. Not to mention all those who can't actually get refinanced. I'd say that's pretty good evidence that we should figure out a way to keep small banks around.

The bottom line: Dodd-Frank will not go away because Obama is not going away, so up to as many as 6300 banks may go away, destroying what's left of free market competition in banking. The people are already the losers, and stand to lose even more.

Since the beginning of 2008, 460 banks have failed.

NJ Gov. Christie To Housing Haters: "Nothing Is More Precious To People Than Home"

Quoted here:

"There's nothing more precious to people than their homes. Those are where their families are, their memories and possessions of their lives, and there's also a sense of safety to home," New Jersey Governor Chris Christie said late on Thursday.

"That sense of safety was violated with water rushing into people's homes at an enormous rate of speed and people having to literally swim, climb, jump for their lives," he said.

It Takes One To Know One: Carl Bernstein Smells Radicalism In The Air

Carl Bernstein of Woodward-Bernstein fame thinks he's caught a whiff of radicalism in Mitt Romney and the Tea Party, here at The Daily Beast, imagining all sort of vain things about both of them.

By the end of the hysterical tirade he calms down a little and realizes his own progressivism qualifies as radicalism, too, but he'd much rather call his beloved progressivism a "transformational movement". In other words, "progressivism good, radicalism bad", sort of like how liberalism got a bad name and had to be replaced at all costs if liberalism were to continue to retain influence.

The reality is the Tea Party is a reactionary movement trying to forestall the radicalism of Barack Obama. Reactionary movements often are mistaken for radical movements because in order to succeed in their objective they have to get to the root being yanked out of the ground by others, by the revolutionaries, and replant it. As such reactionaries, the Tea Partiers are counter-revolutionaries: "Put It Back!"

This is not to say that reactionary movements cannot be hijacked by ideologues any less than true revolutionary movements are inspired by them. The American revolutionaries are a case in point. They never embraced the idealisms which turned into a class war against aristocrats in France. It is unthinkable that the history of the early American independence movement would have turned out as it did had it otherwise been a movement about liberty, equality and fraternity. Former loyalists were welcomed back. While enthusiasm for the idealism of natural rights among Tea Party activists is reminiscent of this, especially among the libertarian elements, the genesis of the movement was in reaction to Obama's proposed mortgage bailouts of deadbeat homeowners, many of whom were becoming infamous for "walking away". Like a good reactionary, Rick Santelli gave voice to his indignation at these people on national television in February but characteristically planned a Tea Party protest on the beach of Lake Michigan for months later, during his summer vacation. In the interim, he had to go to work.

The people, however, had other ideas about waiting. But unlike real radicals such as the Occupy Wall Street types, their protests were peaceful, orderly, clean, and came to an end, and then transformed themselves into the constructive activity of political action, retaking the US House in 2010 for the Republicans in order to stop Obama. As a political movement, it should be understood in those practical prophylactic terms despite the efforts of Republicans to co-opt the movement. The Tea Party is a movement of Americans who are radical only in the sense that they have rediscovered their roots in the constitution and the world which gave it birth.

The true radicals in the bad sense are those who would extirpate them.  

Like Liberals, Libertarians Hate Homeowners

Like liberals, libertarians hate homeowners.

Liberals resent the competition and don't want them "moving on up" to the East Side or to their gated communities, ruining the neighborhood, and libertarians hate homeowners' bourgeois values, especially the fact that homeowners resist becoming interchangeable parts in their global corporate pursuit of economic efficiency, rather resent being treated like depreciating assets, and often think the most important gift they can give the country is future taxpayers and productive workers raised in stable, safe, socially well-adjusted environments.

But there is also a shared reason: because homeowners tend to be neither liberal nor libertarian, but conservative.

From libertarian Arnold Kling, in his own words:

'If there is a tendency for property owners to become libertarians, I find this difficult to observe. Clearly, most home owners are not libertarians. Some owners, in fact, become decidedly unlibertarian NIMBYs, where “not in my backyard” becomes their byword for infringing on the liberties of others.'

Damn right, Arnold, homeowners do tend to infringe on others' rights, just like the Decalogue infringes on my right to say everything that's on my mind, murder, steal, commit adultery, covet, practice idolatry and ignore filial responsibilities.

If you want to act like a reprobate, it's a free country, but not in my backyard.

Transformation After Four Years: Lost AAA Credit Rating, 8.97% Average Unemployment, Average Report of GDP 0.825%, Housing Values Down 13%

"After decades of broken politics in Washington, and eight years of failed policies from George W. Bush, and 21 months of a campaign that's taken us from the rocky coast of Maine to the sunshine of California, we are five days away from fundamentally transforming the United States of America."

-- Sen. Barack Obama, October 2008, Columbia, Missouri

Top Tax Loss Expenditures Projected For 2011-2015

From the Joint Committee on Taxation's January 2012 projection, here are the top individual categories of lost tax revenue, commonly referred to as tax loss expenditures (the revenue value of tax deductions, tax exclusions, and tax credits), for the five year period from 2011, annualized:

1. Healthcare, healthcare insurance, long term care insurance = $ 145 billion

2. Mortgage interest = $ 93 billion

3. Dividends, long term capital gains = $ 91 billion

4. 401k plans = $ 75 billion

5. Earned income credit = $ 59 billion

6. Pension plans = $ 53 billion

7. State, local income, sales, personal property taxes = $ 46 billion

7. Capital gains at death = $ 46 billion

8. Cafeteria plan benefits = $ 40 billion

9. Untaxed Social Security and Railroad Retirement = $ 38 billion

10. Charitable giving = $ 37 billion

11. State and local government bonds = $ 36 billion

12. Medicare Part A = $ 35 billion

13. Child tax credit = $ 34 billion

14. Life insurance and annuities = $ 30 billion

15. Medicare Part B = $ 27 billion

16. Capital gains on sale of primary residence = $ 25 billion

17. Property taxes on real property = $ 23 billion

Red = housing related ($ 118 billion)

Green = health related ($ 247 billion)

Blue = investment related ($ 137 billion)

Yellow = retirement related ($ 196 billion)

Purple = social welfare related ($ 130 billion)

Black = state and local government related ($ 105 billion)                                    

Capital Gains Income Averaged $497 Billion Annually 2000-2009

From a story in June by the Tax Foundation, here, on volatility in the sources of personal income.

Taxed at 15%, average capital gains income of $497 billion produces almost $75 billion in revenue annually, just shy of what the mortgage interest deduction "costs" the government. You could almost say the current capital gains tax pays for the mortgage interest deduction for everybody. Taxed at 20%, the same amount produces $99 billion annually. At 28% $139 billion annually. At 35% $174 billion annually.

VP Joe Biden Grossly Underestimated The Drop In Housing Equity

My jaw almost hit the floor when I heard Vice President Biden in debate with Paul Ryan say this:

BIDEN: I don't know how long it will take. We can and we will get it [unemployment] under 6 percent. Let's look at -- let's take a look at the facts. Let's look at where we were when we came to office. The economy was in free fall. We had -- the great recession hit; 9 million people lost their job; $1.7 -- $1.6 trillion in wealth lost in equity in your homes, in retirement accounts for the middle class. We knew we had to act for the middle class. We immediately went out and rescued General Motors. We went ahead and made sure that we cut taxes for the middle class. And in addition to that, when that -- when that occurred, what did Romney do? Romney said, "No, let Detroit go bankrupt." We moved in and helped people refinance their homes. Governor Romney said, "No, let foreclosures hit the bottom."

The vice president isn't even close to appreciating the devastation endured by home owners in this country.

Here's a chart I posted previously taken from the most up-to-date figures from the Federal Reserve showing peak to trough owners' equity dropping a whopping $6.9 trillion, not $1.7 trillion.

The vice president not only doesn't grasp the scope of the losses experienced by the middle class, the Obama administration hasn't done one thing to put housing on a proper footing going "forward", the slogan of their campaign.

Instead, Obama & Co. spent the first two years ramming health care reform which we didn't want down our throats at the same time we were losing our homes.

If ever anyone should be FIRED! for incompetence and malfeasance, it's these guys. Otherwise get ready to spend your retirement years living in the back seat of your rescued Government Motors automobile.

Why Should Government Support Home Ownership? Babies Need Nests!

America should support home ownership because babies need nests. Babies are future taxpayers. Babies are the future.

Is it any coincidence that in the wake of the housing debacle and the employment depression birth rates have now tanked to record lows?

No nests, no jobs, no babies.

Time has the story here:

[I]n 2011 . . . the general fertility rate (63.2 per 1,000 women ages 15 to 44) was the lowest ever recorded; the birth rate for teenagers ages 15 to 19 declined; birth rates for women ages 20 to 24 hit a record low; and rates for Hispanic and non-Hispanic black women dipped. Some birth rates remained unchanged, like those of women in their late 40s. Only women ages 35 to 39 and 40 to 44 are more likely to have babies now than in the past.

Unemployment Drops To 7.8 Percent, Just In Time For The Election

After 43 straight months of unemployment over 8 percent, and an average of monthly reports of 9.0 percent for the entire Obama presidency, the absolute worst record in the post-war period, unemployment has suddenly fallen by 0.3 points in one month from 8.1 percent in August to 7.8 percent in September.

Just in time for the election!

From the Bureau of Labor Statistics, here:

The unemployment rate decreased to 7.8 percent in September, and total nonfarm payroll employment rose by 114,000, the U.S. Bureau of Labor Statistics reported today. Employment increased in health care and in transportation and warehousing but changed little in most other major industries.

The unemployment rate declined by 0.3 percentage point to 7.8 percent in September. For the first 8 months of the year, the rate held within a narrow range of 8.1 and 8.3 percent. The number of unemployed persons, at 12.1 million, decreased by 456,000 in September.

Romney Is Half Right: One Tax Proposal Is New, And Alarming

And it is amazing no one has taken this seriously:

"My plan is not like anything that's been tried before. My plan is to bring down rates, but also bring down deductions and exemptions and credits at the same time so the revenue stays in, but that we bring down rates to get more people working."

Romney is threatening to reduce the value of exemptions and credits which exist under the existing tax code.

This amounts to major fiddling which the preoccupation with "deductions" obscures.

Deductions we have lost before, as in the 1986 tax reform. That he wants to reduce the value of more deductions is bad enough. But the truly alarming thing is the proposal to do the same to exemptions, and to a lesser extent to credits. That is new, and alarming.

That can only mean the whole set of assumptions involving the system of personal exemptions, and perhaps also the time-honored "married filing jointly" status itself, and credits such as the Earned Income Credit and the Child Tax Credit and the like. I can well imagine a President Mitt Romney eliminating the favoritism of the tax code toward married people, and toward their housing and their children, to make gay and unmarried people equal to them in the tax code. Remember, in Massachusetts Gov. Romney had a reputation, deserved, for being a tax equalizer.

I also expect he will propose capping the value of deductions and credits by using something like Martin Feldstein's plan, in order to preserve the deductions and credits for lower income individuals but phasing them out as one climbs the income ladder. In other words, the progressive tax code stays, but progressivity of tax deductibility goes out the window. That may be fair to a liberal like Romney, but it isn't maintaining progressivity, it is steepening it.

Mitt Romney is not a social conservative. And if he gets his way with the tax code, I suspect he's going to prove it, unless conservatives in the US House stop him.

Good luck, America. You're going to need it.

On 4th Anniversary Of TARP, 12% Of Banks Are Still In Trouble

nonperforming bank loans as percentage of total

The FDIC reports as of June that it has 7,246 member banks with $14 trillion in assets. Four years ago there were 8,384 member banks with assets of $13.6 trillion. Bank failures and consolidation in the industry have reduced the total membership by over 13 percent in the interim.

Bank failures have cost the Deposit Insurance Fund, funded by member premiums, in excess of $80 billion, costs which are inevitably passed on to bank customers. TARP was deliberately morphed into a fascist capital injection scheme when it became clear that identifying and buying toxic mortgages was an unworkable solution, cooked up as it was in a panic. The capital injections effectively made taxpayers unwilling stockholders in troubled "financial" institutions, some of which were not commercial banks to begin with but were allowed to become so to obtain protection.

Meanwhile bank nonperforming loans in the US continue at a high level, over three times higher than prior to the financial crisis in 2008, despite TARP's measly billions, and despite the real action trying to circumvent free-market capitalism involving trillions of dollars of Federal Reserve liquidity interventions.

An unofficial list of problem banks tracked here currently shows 874 institutions still under some form of FDIC supervision for irregularities of one kind or another, four years after the passage of the Troubled Asset Relief Program signed by President Bush on October 3, 2008.

Sen. Barack Obama voted for the TARP program in the US Senate, as did Sen. John McCain, his opponent for the presidency, joining the rest in the US Congress who wanted to make it appear they were doing something about the crisis. In the wake of TARP the stock market crashed anyway in the succeeding month, preparing the way for the debacle of March 2009 five months later. The mortgage market remains effectively dead, along with housing, net worth, and employment, zombies all. 

How much better off we would be today if we had simply embraced the failure prescribed by capitalism instead of denying it. Bankruptcy courts would have been busy selling off assets to responsible actors, debts would have been adjudicated, and a few high profile bad players may have actually gone to trial, and jail, by now.

Instead it's just more of the same: government of the bankers, by the bankers, and for the bankers.

The Greedy Bastards' Big Lie About Your Mortgage Interest Deduction

1

Read the data for yourself, here, from the Joint Committee on Taxation's own estimate of the "cost" to the government of your mortgage interest deduction.

The JCT estimated that the government's biggest loss of revenue between 2007 and 2011 came from the exclusion of dividends and long term capital gains from higher tax rates. This does NOT include gains from selling real estate.

Tax losses from deductions for health insurance expenditures ranked second, tax losses from deductions for retirement plans third, all three of which range between $632 billion and $607 billion over 5 years.

The tax loss from deducting mortgage interest was a distant fourth, at $430 billion, yet the drumbeat from so-called conservatives to eliminate the deduction gets louder everyday.

Can you say, "Middle Class Tax Increase"?

2

3

4

Video Of Romney Backtracking On Tax Cuts, Threatening Your Deductions

Romney will take away your deductions and exemptions

Romney the tax simplifier, tax leveler, tax back-tracker, tax flip-flopper, uncertain tax trumpeter was on display in Ohio this week, posing himself as a clear and present danger to the tax code's many indispensable props to middle class family life, including not just the mortgage interest deduction but also for the first time "exemptions".

The last time a Republican talked this way was in 1986 when Ronald Reagan took away deductibility of credit card interest in exchange for lower overall rates.

Those rates lasted until Clinton, when they were raised. But deductibility of credit card interest? That never came back, and never will.

The same thing is going to happen to the home mortgage interest deduction, and possibly to "married filing jointly" and other such provisions of the current tax code. You'll get lower rates . . . for a while, until they have to raise them.

And then the protections of the current provisions will be absent, exposing you to the full force of increased tax rates.

The fat cats from The Wall Street Journal and Forbes Magazine to Rush Limbaugh, Mitt Romney, the Libertarians and the Simpson-Bowles crowd all want their greedy little hands on more revenue from the middle class . . . so they don't have to pay as much. It's just that simple.

And they are betting you are so stupid that you will vote for that!

There is nothing wrong with the current code which spending cuts cannot fix.

Story and video here.

And We Said NO To King George III . . . Why?

Moochelle and the Mooch are milking the presidency for all its worth, according to this story in The Daily Caller:

Taxpayers spent $1.4 billion dollars on everything from staffing, housing, flying and entertaining President Obama and his family last year, according to the author of a new book on taxpayer-funded presidential perks.

In comparison, British taxpayers spent just $57.8 million on the royal family. ...

Aside from a salary, the president gets a $50,000 a year expense account, a $100,000 travel account, $19,000 entertainment budget and an additional million for “unanticipated needs,” he notes.

It's the worst economy since WWII, but the Obamas are costing us 24 times what a Queen would. A Constitutional Monarchy never looked so good.

Romney's Alarming Flip On Taxes: Expect Cuts To Deductions And Exemptions

The Wall Street Journal, here, is describing this flip as a shift.

I'll say, like a mountain shifting, or a Giant Foo Bird shifting its entrails over your house:

Mitt Romney on Wednesday told an Ohio crowd that while he would work to lower tax rates on businesses and individuals, they shouldn’t “be expecting a huge cut in taxes because I’m also going to lower deductions and exemptions.”

The deductions we all fear losing are relatively common knowledge, like the home mortgage interest deduction. Romney has been cagey about this, on again off again about reducing the benefit for higher earners only. But this outburst sounds like cutting the deduction for those farther down the income ladder is possible. 

Cuts to "exemptions" is an entirely new animal, however, and goes to the very heart of the tax code. Since Americans fought hard after WWII for the tax-filing category "Married Filing Jointly", the prop to families trying to raise children on one income has come under repeated attack, first under Nixon, and then from feminists who deplored the special tax status given to families. Gay and lesbian couples tirelessly work for recognition of their unions as marriages mostly because they want in on the tax preference.

It is extremely disappointing to hear Romney talk this way. It plays entirely into the hands of the opposition, who can use it to sow doubt in the minds of his would be supporters about whether Republicans will raise taxes on the middle class. I , for one, think Romney will say anything he thinks he has to in order to win votes, even if it is self-contradictory. But the fact of the matter is Romney was a tax equalizer in Massachusetts, which meant privileges for favored groups went out the window, and so fees went up on businesses and taxes went up on properties to adjust to his leveling programs. 

With Rush Limbaugh candidly letting it slip today that the middle class has been pandered to through the tax code, the drumbeat against the people grows in intensity.

And the dupes will vote for it.

Republicans Still Don't Get It: Obama Is Not Carter Redivivus

Until the Republican Party comes to grips with the fact that the Bushes were two of the very worst presidents for the economy in the post-war period, it is never going to understand the current problem and offer America a decent alternative, which is that Obama is continuing in the Bushes' footsteps and is actually worse than them, if that were possible.

Obama is the second coming of George Bush, not of Jimmy Carter.

If only we had an economy like Jimmy Carter's, lousy as it was for its time. But total household net worth never increased more as a percentage than under his short tenure, and he ranked third best in the post-war period for increasing housing values. Those two categories, incidentally, were also where his successor Ronald Reagan shined the brightest as well.

Erick Erickson should know better:

"There are a lot of elitist Republicans who have spent several years telling us Mitt Romney was the only electable Republican. Because the opinion makers and news media these elitists hang out with have concluded Romney will not win, the elitists are in full on panic mode. They conspired to shut out others, tear down others, and prop up Romney with the electability argument. He is now not winning against the second coming of Jimmy Carter. They know there will be many conservatives, should Mitt Romney lose, who will not be satisfied until every bridge is burned with these jerks, hopefully with the elitist jerks tied to the bridge as it burns."

Mitt Romney is a fiscally conservative social liberal who doesn't really have a home in either of the two major political parties, which is why he's being attacked from all sides. It is not because of his social liberalism but because of his fiscal conservatism. Which is to say that both parties have expunged that idea from their lexicons since LBJ and no one really knows what it even means anymore.

But Romney may indeed know, and always gives the impression of knowing, which is why he is having a likeability problem. He comes off as the bad banker who won't increase your credit limit until you start catching up on your payments.

No one really likes a guy like that, but that is the kind of guy whom we most need right now, holding the veto pen. If he loses, fear of that will be the reason.

No one likes a spending party pooper.