I’ve had enough of Mike Pence: How do tax cuts create jobs?

More money in our pockets does not ensure spending.  Do you know what I did with my previous stimulus check?  I bought $30 worth of comic books and put the rest in my savings account.  Others paid off utility and credit card bills.  If you don’t believe me, listen to financial writer David Cay Johnston on NPR this morning.  He lays out the real world scenario from a small business perspective – businesses don’t typically hire a new worker if when they receive a tax break.  They hire a new worker when there is demand for their product.  What does this stimulus bill do?  It turns the federal government into a consumer by purchasing goods and services from these small-medium-large businesses so they can hire more workers to meet demand.

When the economy puts the screws on the workers in the economy and these workers are given a small pile of money, they are not going to go buy cars and flat screen TVs, Mike.  So, lay off the same tired old ideas.  You had your decades of reducing taxes and indirectly dismantling the federal government thereby creating the power vacuum that corporate America was happy to fill.  Now, it’s time to clean up the mess that was made (create jobs and unfreeze credit)and re-position the country to not experience this again (more funding for the SECs, EPAs, FCCs of the world).

Pence sure likes to stretch the truth here.  There is “nothing” in this bill that will help grow the economy?  There is ”nothing” that will create jobs?  That’s a little hard to believe, no?

If you’re not mad about the bailout, allow me to help

With the TARP bailout looming in the mouths of all the pretty faces on the all powerful glitter box, the bigger picture has been missed. Yes the TARP is a big deal, (for all of you recently thawed from cryogenic freeze, the TARP is essentially a 700 billion free cash give away from the US treasury to their favorite struggling banks) but the banks stream of money has been flowing for a really long time. The list is so long I can’t even recount it. Some that I can remember are

• The bailoutof AIG reported as at least 80 billion,
• “Infusions” of capitol to international banks of 200 billion on three separate occasions,
• A program that allowed banks to swap bad assets to the Federal Reserve for Treasury notes. It should be noted that no one knows how much was traded or what the cost is because the Fed won’t tell us). Needless to say the total cost of all bailout schemes is much much higher then the 700 billion that has become the number du jour to the media.

I am just going to throw a number out their are you ready? 5 TRILLION DOLLARS. That is not my number that has been widely reported by the AP and others. Naysayers head here. Mad yet? well lets keep going shall we? Their are 350 million Americans. Subtract from that children the elderly and the unemployed lets call the number of tax paying Americans 200 million, and that’s being generous (we are an ageing population). Guess what your cut of 5 TRILLION would be………….go ahead guess I will wait……………………………….. got a number? well your wrong it’s 25,000 dollars. 25,000 dollars to all you hard working tax paying Americans, talk about a stimulus.

This seems especially silly when you consider all this trouble arises from the idea that working Americans will be unable to meet their debt obligations causing the derivatives that back those debts to lose value and in turn wiping out the value of the banks. But if you gave us all 25k who would work at Wal-Mart tomorrow, that would be a years salary on their slave pay scale.

Bush/Republican Capital Gains Tax cuts – helping the 400 richest Americans

Wow, who would have thought Michael Bloomberg, likely one of these 400 would allow something like this to be posted on bloomberg.com.   Maybe the site really is an independent and reliable news source.  Bloomberg.com writes that, according to new IRS data,

The average tax rate paid by the richest 400 Americans fell by a third to 17.2 percent through the first six years of the Bush administration and their average income doubled to $263.3 million.

Could our wealth class really be made of only 400 people in this country whose wealth doubled from a trickle down economic tactic in such a short amount of time?  Capital gains made up 63% of these individuals adjusted gross income in 2006.  This is all thanks to Bush’s tax cut in 2003.  For those at home that are a little unsure about capital gains taxes, click here.  Basically under Bush, the government is collecting less taxes on the profit made when one sells off stock investments.

This is the battle.  It’s not racial nor is it ethnic.  It’s not North vs. South, East Vs. West.  It’s the wealth class in this country that we have to be aware of and control.  And evidently, they number less than 500.  Now to be fair,  I would also stand to make a boat load of cash from these tax cuts if I had that much money I could tie up in the stock market AND I knew to sell off before the economy tanked.  But I’m not buying it and I doubt you are as well.  What makes me sick to my stomach is if someone was able to see what would happen in 2008 and coaxed a tax cut out of little W to squeeze more money out of the broken system before it tanked.  Or if somehow, these tax cuts exacerbated the mess we’re in now.