I found the source for Trump's well-founded fear of an auto industry bloodbath

 CNBC reports today:

Why a small China-made EV has global auto execs and politicians on edge :

There’s fear among global automakers that Chinese rivals like the Warren Buffett-backed BYD could flood their markets, undercutting domestic production and vehicle prices to the detriment of their own auto industries.

“The introduction of cheap Chinese autos — which are so inexpensive because they are backed with the power and funding of the Chinese government — to the American market could end up being an extinction-level event for the U.S. auto sector,” the Alliance for American Manufacturing, a U.S. manufacturing advocacy group, said in a report last month.

BYD sold 1.57 million battery EVs last year, up from just 130,970 all-electric vehicles in 2020. That sales growth was enough to surpass Tesla to become the world’s largest producer of electric vehicles in late 2023. 

The rise of BYD and other Chinese automakers led Tesla CEO Elon Musk in January to warn that Chinese automakers will “demolish” global rivals without trade barriers. ...

The company has quickly rolled out new and updated products. It’s also rapidly established manufacturing, as it has its eyes set on factories in Thailand, Brazil, Indonesia, Hungary, Uzbekistan and, potentially, Mexico. ...

Former President Donald Trump – the front-runner among Republicans in the 2024 presidential race – on Saturday suggested instituting a 100% tariff on cars made in Mexico by Chinese companies, should he be elected to a second term.

It's been a terrible year so far for investors in US Treasury securities because of the rising rate environment, but great for stocks

UST yields rose a net 1.31% in the aggregate week over week on 7/28.

DFF rises to 5.33% after the latest FOMC rate hike.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to date Treasury, Total Bond, Cash, and Total Stock performance using popular Vanguard funds:

VFISX +0.75% VFITX 0.90% VUSTX 1.58% VBTLX 2.05% VMFXX 2.75% lol VTSAX 19.99%!

Stocks have been the place to be, and cash has beaten even the total bond market.

Meanwhile stocks are obscenely overvalued at 169 using the latest report of GDP out Thursday:

 

The stock market remains obscenely overvalued

 On Friday it hit 167.

Off the chart.

At 194 at the January 2022 high or 139 at the October 2022 low, it's all the same to me

Obscenely overpriced.

 

 

The percentage holding full-time jobs through September 2022 held above 50%, disappointing the ubiquitous advocates of a Fed interest rate pivot

 Full time as a percentage of civilian population in September was 50.3%, and for 2022 through September averaged 50.15%.

Not bad, considering.

The Fed will see little evidence in this figure that its interest rate increase policy is harming employment.

Stocks on Friday collapsed after a head fake to start the week to within 1.5% of the 52-week lows set a week ago.

Long term investment grade bonds and US Treasury securities also revisited lows from 9/27/22, coming within pennies of those benchmarks.

30-year yield for UST is back up to 3.86%. It was 3.87% on 9/27. At the beginning of 2022, yield was a paltry 2.01% by comparison.

UK gilts are experiencing the same action despite the Bank of England intervening to buy bonds. 

The bond crisis is not over.

With yields soaring across the board no one wants to own the lower paying outstanding issues, which are legion, destroying their value.

But everything in the global economy is based on those, piled up in earnest after The Great Financial Crisis of 2008, and in orgiastic frenzy afterwards during the late pandemic.

Bond yields in 2022 are telling you that they are overvalued by 92%.

Stock market valuation is telling you a similar thing.

From 1938 through 2019 the median ratio of the S&P 500 to GDP is 81. In 2020 we averaged 154, or 90% overvalued.

This is the major deflationary headwind facing the world, the other side of the COVID-19 inflationary shock coin.

Push here, it comes out over there.

Modern central banking cannot escape this conundrum any more than the gold standard could.

The only thing the individual can do in this situation is to owe nothing and save everything, preferably in your hands.

Good luck.

 

 

 

 

 

 

 

 

 

 

 

 

LOL, the Drudge help writes "takies" talking about "Thiel" "taking aim"

 Takies aim at Bitcoin's 'enemies' Dimon, Fink...

Warren Buffett, the king of contraception funding, thinks women waste their brains having children

Two peas in a pod dedicated to deciding against life.

If you want to know why America is dying, look no further than Warren Buffett, a man at war with human nature, who frankly doesn't care that without fertility there will be no one left to consume.

From the story in Bloomberg, here:

“Buffett alone will give more than all of the other foundations combined in reproductive health,” she said. “We already are this year [2008], and that will continue.” [Judith] DeSarno declined to comment for this article, other than to say, “I am incredibly proud of this work and the dramatic decrease in unintended pregnancies.” ...

Quietly, steadily, the Buffett family is funding the biggest shift in birth control in a generation. “For Warren, it’s economic. He thinks that unless women can control their fertility—and that it’s basically their right to control their fertility—that you are sort of wasting more than half of the brainpower in the United States,” DeSarno said about Buffett’s funding of reproductive health in the 2008 interview. “Well, not just the United States. Worldwide.” ...

In the 1960s, the [Buffetts] set up what was then called the Buffett Foundation, which focused on nuclear disarmament and reproductive health, including helping to fund Planned Parenthood as well as the development of RU-486, the so-called abortion pill. In the late ’70s, the duo entered into an unusual arrangement—they remained married, but Susan moved to San Francisco. 

Market cap to GDP ratios March 2009 vs. March 2014 flash valuation warning

Probably the broadest measure for stock market valuation purposes is total stock market capitalization divided by GDP. Warren Buffett uses it and John Hussman has spoken approvingly of the measure.

But because we have to wait for GDP numbers for at least a month after the quarter end, the ratio cannot be a real-time valuation tool. And given that revisions to GDP can be substantial in the 2nd and 3rd estimates, as well as in the annual summer revisions, precision using the 1st estimate is also wanting. Nevertheless the calculation provides a big picture snapshot of where we have been in the market cycle, and gives forward guidance for long term investors. Presently it appears to counsel taking chips off the table and waiting in cash for a better opportunity to invest. 

For the following I use nominal figures for GDP as revised in the most recent updates from bea.gov and calculate market cap using the popular Wilshire 5000 (level x $1.2 billion) as close to March 31 as practicable.

A comparison of March 2009 to March 2014 is instructive, since March 2009 was a pretty good buying opportunity both in terms of the absolute level of the stock market after its decline and the coincident Shiller p/e valuation which was about 13.3 on March 1. The ratio has almost doubled in the interim, indicating that now is probably not a good time to commit large new sums to stock markets. The current Shiller p/e begins the day at 26.31, which is also nearly doubled from five years ago.

That said, the 10 year Treasury presently pays just 69 basis points more than the dividend yield of the S&P500. At the October 2007 stock market high, the 10 year Treasury paid 276 basis points more than the dividend yield of the S&P500. You could argue the Fed caused the markets to crash by taking rates much too high in 2006 and 2007 and that Janet Yellen is bound and determined not to let that happen again anytime soon, meaning stock markets could have higher to go. Keep in mind that the inflation-adjusted all-time high of the S&P500 was 2045.09 on August 1, 2000. We're at 1962.46 this morning. 

March 30 2009

$10.32 trillion market cap

---------------------------------------------- = 0.72

$14.38 trillion GDP

March 31 2014

$23.99 trillion market cap

---------------------------------------------- = 1.41

$17.02 trillion GDP

Run away: Today's total market capitalization/GDP ratio is 1.46

$25.003 trillion
-------------------  = 1.46 (June 23, 2014: a really bad time to invest)
$17.101 trillion


$10.222 trillion
------------------- = 0.71 (April 6, 2009: a pretty good time to invest)
$14.381 trillion













h/t John Hussman, Warren Buffett

Warren Buffett keeps the liberal wolves at bay by favoring higher taxes and now we learn abortion to the tune of $1.2 billion

In exchange for Warren Buffett's liberalism on tax increases on the rich and his support for abortion Obama is content to enrich Buffett with oil carried by Buffett's rail cars instead of approving the Keystone Pipeline, which in turn serves to strengthen Obama's support from the environmentalists while hurting Obama's conservative enemies as well as his greater enemy, the nation.

See how useful just one idiot can be?

Story here.

North Dakota Railroad Involved In Accident Causing Oil Inferno Is Wholly Owned By Warren Buffett

The New York Post has the story here, but never mentions Warren Buffett, who has become richer off transportation of oil by rail because his pal Barack Obama did him a favor by stopping the XL pipeline in exchange for his support for higher taxes on the rich:

The derailment happened amid increased concerns about the United States’ increased reliance on rail to carry crude oil. Fears of catastrophic derailments were particularly stoked after last summer’s crash in Canada of a train carrying crude oil from North Dakota’s Bakken oil patch. Forty-seven people died in the ensuing fire. The tracks that the train was on Monday pass through the middle of Casselton, and Morris said it was “a blessing it didn’t happen within the city.” The train had more than 100 cars, and about 80 of them were moved away from the site.

According to Wikipedia, here, and BNSF's own website:

The BNSF Railway is the second-largest freight railroad network in North America, second to the Union Pacific Railroad (its primary competitor for Western U.S. freight), and is one of seven North American Class I railroads. It has three transcontinental routes that provide high-speed links between the western and eastern United States. BNSF trains traveled over 169 million miles in 2010, more than any other North American railroad. ... Headquartered in Fort Worth, Texas, the railroad is a wholly owned subsidiary of Berkshire Hathaway Inc.

10-Year Treasury Rate Ends The Week At 2.64%

The 10-year US Treasury Rate ended the week at 2.64%, 43% below the mean level going back to 1871.

Despite the best efforts of the US Federal Reserve to suppress interest rates on behalf of other "investments" like housing and stocks, the current rate of the 10-year Treasury still bests the dividend yield of the S&P500 by 34%, which ended the week at 1.97%. From another perspective, it's even worse than that.

John Hussman noted this week here that based on the ratio of equity market value to national output, you might expect less than zero from the S&P500 going ten years out: 

Likewise, Buffett observed in 2001 that the ratio of equity market value to national output is “probably the best single measure of where valuations stand at any given moment.” On that front, the chart below [follow the link above] shows the value of nonfinancial corporate equities to GDP (imputed from March to the present based on changes in the S&P 500). On this measure, the likely prospective 10-year nominal total return of the S&P 500 lines up at somewhere less than zero. Suffice it to say that our estimates using both earnings and non-earnings based measures suggest a likely total return for the S&P 500 over the coming decade of less than 2.9% annually, essentially driven by dividend income, and implying an S&P 500 that is roughly unchanged a decade from now – though undoubtedly comprising a volatile set of market cycles on that course to nowhere.

In other words, it's possible stocks could return absolutely nothing over the next decade, or just barely beat bonds by less than 10% based on the current 10-year Treasury rate. For sleeping soundly at night, the choice is easy.

The 10-year Treasury rate has backed off about 10% since Ben Bernanke reversed himself on tapering bond purchases this month, seeing how it was knocking on the door of three.

Normalization of the 10-year yield would cost the US government dearly, jacking up interest expense costs over time which are paid from current tax revenues, by nearly double. In the last four years under Obama, interest payments on the debt have averaged $403 billion annually. Increasing those payments 43% would add another $173 billion to budgetary requirements, again, not all at once but over time.

Warren Buffett, Amoral Crony Capitalist, Bought An Indulgence From The Left

So says Daniel Mitchell of The Cato Institute, here:

"If you’re an amoral person with political connections, it’s possible to make a lot of money.

"Warren Buffett lined his pockets by making a government-subsidized investment in Goldman Sachs during the financial crisis.

"The rest of us suffered and he got richer, but the left seems to be okay with that perverse form of redistribution because he supports class-warfare tax hikes. Sort of like buying an indulgence in the Middle Ages."

I really like that analogy with the church because it speaks to the failure of all idealist conceptions to deliver on what they promise. This is as true of socialism as it is of capitalism, of fascism as it is of Christianity. All offer a promised land which never seems to arrive, but you have to ask yourself who thought this stuff up.

Like beer to Homer Simpson, it is we who are the cause of and the solution to all of life's problems.

Harold Meyerson Thinks The Rich Got One Sweet Deal From The Democrats

Because the capital gains tax rate was raised only 33% from 15% to 20% instead of rising 164% to equalize it with the fiscal cliff deal's highest ordinary income tax rate of 39.6% on the richest Americans. Yikes! Can you imagine?

For The Washington Post, here:

"The tax deal Congress passed last week raised the top rate on wages and salaries from 35 percent to 39.6 percent. The rate on income from capital gains and dividends, however, was raised to only 20 percent from 15 percent. There has been no rending of garments nor gnashing of teeth from our super-rich compatriots; they got one sweet deal."

But it's a point conservatives should ponder more because Meyerson writes of common ground we share.

For one thing, there is love of country in Meyerson's article, a desire to see Americans benefit from investment domestically where it throws off all sorts of additional beneficial economic effects, instead of seeing those accrue to communities in foreign lands. American business long ago became unpatriotic in service to the almighty bottom line, which is why your job went to Mexico and then to China. This ushered in a process which has made the American worker more equal to the poverty of the foreign worker, instead of the other way around. But higher taxes on investment capital aren't going to reverse that. Only disincentivizing foreign investment and rewarding domestic investment will, which is a point which illuminates a conservative principle.

When it comes to economic inequality, conservatives should consider Meyerson's observation that the biggest gains overall in recent decades have come in investment income to wealthy investors, not in ordinary income to the rest of us. He doesn't say so, but it illustrates a conservative principle: When you want less of something, tax it. That is precisely what has produced the situation he decries. We have taxed ordinary income exorbitantly compared to investment income and consequently we have less of the ordinary income variety and more of the investment income variety. And we also actually reward foreign investment in the tax code, allowing unpatriated profits to escape taxation. To get more gains in ordinary income, we should equalize tax rates between ordinary and investment income . . . just not at progressive income tax rates. Conservatives should press for a world in which all money is treated the same in the tax code by taxing income of all kinds at one low uniform rate. Income inequality has to begin somewhere, and it begins in the tax code, not in the profits of Warren Buffett.

Similarly with supporting an aging population, it would be nice if there were a little liberal outrage, and a little conservative outrage for that matter, for the way the federal government conspires to suppress interest rates with a weak dollar policy. This punishes savers, but especially the old who expected and need return on capital to take care of themselves instead of depending on government. A strong stable dollar which has the same value when you are 80 as it had when you were 8 is what we need, but sadly our entire class of elites is committed to monetarism, which at its root means the dollar of 2013 could hardly be less equal to the dollar of 1913 than it is.

There is a theme here involving inequality, expressed in lower-wage foreign workers, ordinary income punished with higher relative taxes, and devalued savers' dollars, which could unite liberals and conservatives, and also the country, if only it had an effective advocate in a statesman who had the audacity to point out that big business and big government seem to be joined in common cause against the best interests of the American people. None dare call it fascism.

Progressive Lefties At TNR Recognize Senate Deal Is "Crappy" For Them

So says Tim Noah, here:

"Nevertheless, this is still a crappy deal, and Democrats should still reject it--or be quietly pleased if House Republicans reject it (as they're threatening to do)."

I agree that the deal is crappy for Democrats, really crappy, but the objective of Obama is only political. What's good for the country is meaningless. He's counting on the right in the House to reject the deal, doing for Obama what he cannot do by himself. It is the extremists of both the left and the right which cannot see how Obama is playing them. If the House had any brains they'd take the tax deal, but I don't think they will, unlike how under Pelosi the House progressives swallowed hard and took the Senate healthcare plan instead of opposing it. Better than anyone they know that ObamaCare is not the end game, but the next step to the single payer idea for which they originally stood.

Politically Obama needed to look like a compromiser, and appear reasonable and "balanced", to match his rhetoric played out over a long period, which is now very familiar to everyone. Later he can use the political capital gained thereby to appear like a genuine savior when he swoops in to offer a tax cut to the poor to relieve these unfortunate souls victimized by Republican "intransigence" over spending cuts. Obama has been telegraphing this for what seems like forever. This lousy deal for Democrats gives all the appearance of compromise, but it is intended rather to go to the heart of the split between the more conservative House Republican caucus and the more liberal Senate Republican caucus.

Once those two groups are split publically over a vote on a bill which will wreck the lives of millions, Obama is in the strongest position ever to appear the benefactor of "the middle class", the group he most wants out of his way in his attempt to level American society. In order to really screw them, he's got to get their complete confidence first. To do so he'll throw them a tax cut bone, which the doofusses will be very thankful for and will repay their master for with grateful support when he goes after their real enemy, the rich. You know, the Romneys and Buffetts of the world who look like the guys who fire them from their jobs.

The problem with true believers is that they are true. It blinds them to the way power shifts, which is why they never succeed.

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.

Rich Guy Prick Warren Buffett Votes For Suppressing The Middle Class

Warren Buffett, here, says raising taxes on the rich would lift the morale of the middle class.

On the contrary, it would help keep the middle class in its place by making it more expensive to get where he is, and more importantly help keep the rich in their place because they can afford it.

Just the way the rich like it.

What a prick.

The Atlantic's Lies About Tax Loss Expenditures

The latest lazy lies attacking the so-called privileges of the so-called middle class come from one Linda Killian at The Atlantic here:

"The three largest expenditures in the tax code are all things many middle-class Americans take advantage of -- tax-free employer-provided health insurance, the home mortgage interest deduction and tax-free 401(k) retirement accounts. ... The tax exemptions for home mortgage interest cost the government more than the entire budget of the Department of Housing and Urban Development according to Steuerle [an Urban Institute economist]."

These are NOT the three largest. They rank 1, 3 and 6, not 1, 2 and 3.

If Linda Killian had bothered to read the Joint Committee on Taxation's latest report on the subject, she would have known that.

Here are the top ten tax loss expenditures for 2011, according to this committee of the US Congress:

$109.3 billion  Employer provided health insurance and related

$ 90.5 billion  Reduced tax rates on dividends and capital gains

$ 77.6 billion  Owner-occupied mortgage interest deduction

$ 59.5 billion  Earned income credit

$ 56.4 billion  Credit for children under 17 aka Child Tax Credit

$ 48.4 billion  401K-type plans

$ 42.7 billion  Pension plans aka union retirement plans

$ 42.4 billion  State/local income, sales and property tax deduct.

$ 38.0 billion  Exclusion of capital gains at death

$ 31.0 billion  Exclusion of benefits under cafeteria plans

$ 31.0 billion  Exclusion of untaxed Social Security and RR benes.

Who benefits from the top three? It's hardly a middle class phenomenon . . . today.

Rich and poor and everyone in between gets health insurance when they are employed by an employer, not just the middle class. And they don't pay tax on that "income." But the size of this break is bound to decline dramatically in coming years, if ObamaCare is not struck down or repealed. Fewer employers will be providing coverage, choosing to pay lower fines instead. Other companies will deliberately downsize in order to escape the requirements under the law, making employer-provided insurance less common than it is today. The net effect may very well be that employer-provided health insurance becomes more and more an upper class phenomenon.

Reduced rates of taxation on dividends and capital gains primarily benefit the rich in America. Could that be why Killian overlooked it entirely? It certainly doesn't fit her narrative against the middle class, does it? But this category is the real number 2 in the list of tax loss expenditures.

Working class and middle class people who are lucky enough to have joined the investor class are investing primarily through tax-deferring vehicles like union pension plans and 401K plans, which rank number 7 and 6 in Congress' accounting of tax loss expenditures. It is questionable, however, for pensions and 401Ks to appear in this list of tax loss expenditures at all. Eventually the deferred money will become income, and it will be taxed.

But the more important point is that everyone in this bottom 66 percent of wage earners by definition makes less than $100,000 per year and by and large very few of them are playing around in the stock market, where fat cats like Bill Gates and Warren Buffett and Mitt Romney derive their unearned income, taxed at the non-permanent lower rates under the Bush tax legislation of 2001-2003. Were these rates permanent, however, this tax loss expenditure wouldn't even make the list.

Contrast that with something which is more or less permanent: the exclusion of income from Social Security taxation. The current income ceiling after which income is not so taxed is almost $107,000 per year. In 2010 just under $2 trillion in ordinary wages and salaries made by the rich escaped the Social Security tax. The tax loss expenditure of that? $125 billion, higher than anything in the Joint Commission's report. And it all went to the rich.

Third is the ever popular whipping boy of the tax reform crowd, the mortgage interest deduction. It should worry average Americans who struggle on the crumbs which fall from their masters' tables that our betters want to make it harder for us to own four walls and a little garden and a tree. 100 million out of 150 million wage earners in 2010 made less than $40,000 per year. Try buying a house on that.

Democrats and Republicans have successfully conspired to attack Social Security for the first time by de-funding it temporarily and haven't yet been electrocuted by the once-feared third rail of politics, so I fully expect them to keep trying on mortgage interest.

Four years ago the mortgage interest deduction was more like $88 billion, so with the collapse of housing we have witnessed a decline in the amount of mortgage interest being paid, and so deducted. $10 billion less. The reason for this is two-fold. One, fewer homeowners. Two, refinanced mortgages at lower rates. With home ownership already under severe stress, it is astonishing that liberals of both parties continue to attack it under the guise of tax fairness. What it really is, is statists greedily looking for more revenue.

I say they can all go to hell.

Obama's Symbol of Tax Injustice (Warren Buffett's Secretary) Must Make $200K To $500K

She can't possibly represent any of the 99 million American workers, 66 percent of the workforce, who make $40,000 per year or less. Fewer than 2.1 million American workers in 2010 made $200K or more.

This woman is no poor secretary. She's in the top 2 percent of wage earners, among the richest people in the country. In point of fact, at her income level and tax rate she pays more in taxes than average workers earn in a year, any of whom would gladly trade places with her.

So Forbes here:

We can get an approximate answer by consulting IRS data on tax rates by adjusted gross income, which would approximate her salary, assuming she does not have significant dividend, interest or capital-gains income (like her boss). I assume Buffet keeps her too busy for her to hold a second job. I also do not know if she is married and filing jointly. If so, it is deceptive for Obama to use her as an example. The higher rate may be due to her husband’s income.  So I assume the tax rate Obama refers to is from her own earnings.

Insofar as Buffet (like Mitt Romney) earns income primarily from capital gains, which are taxed at 15 percent (and according to Obama need to be raised for reasons of fairness), we need to determine how much income a taxpayer like Bosanek must earn in order to pay an average tax rate above fifteen percent. This is easy to do.

The IRS publishes detailed tax tables by income level. The latest results are for 2009. They show that taxpayers earning an adjusted gross income between $100,000 and $200,000 pay an average rate of twelve percent. This is below Buffet’s rate; so she must earn more than that. Taxpayers earning adjusted gross incomes of $200,000 to $500,000, pay an average tax rate of nineteen percent. Therefore Buffet must pay Debbie Bosanke a salary above two hundred thousand.

Even in the most absurd hypothetical situation where the IRS confiscated every last red cent of her $200K salary, Warren Buffett still would be paying nearly 35 times more in taxes than she.

Warren Buffett's 2010 Tax Bill Was $6.9 Million. Was That 'At Least As Much As His Secretary's'?

The details of Warren Buffett's taxes for 2010 were only partially revealed last August and became the subject of critical examination, as for example here:

Buffett also said his federal income tax bill came to $6,923,494, or 17.4% of his taxable income -- two points he revealed in a New York Times op-ed in August urging Congress to tax the wealthy more. ... [But t]he current tax system already satisfies the Buffett Rule. Americans on average pay 16% of their total income in federal income and payroll taxes, while millionaires pay an average of 20.1%, according to the Tax Policy Center.

The Tax Policy Center is a generally more liberal think tank than The Tax Foundation.

The president's statement in last night's State of the Union deliberately suggests Buffett's secretary paid more in taxes than Buffett did when you know that that is completely disingenuous as well as inconceivable:

Now, you can call this class warfare all you want. But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.

Common nonsense.