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Michael Moore’s preferred 95.6 % Income Tax Rate
I saw Michael Moore on Hannity the other night and maybe some of you did as well, but I decided to put his (Moore’s) demeaning comments to Hannity down on paper mathematically. If you watched the show you know that he was talking down his nose to Hannity all night suggesting that he didn’t care about the “poor” at all. When Hannity asked Moore to define what his tax plan would be he said the following below. Please bear with me as I transcribe his comments into real values. Also my assumptions are not assumptions at all, but based on “taxing the rich” as Moore prefers.
Since we are talking about the rich and both Hannity and Moore could be described as “rich” with each making income in the million’s I am going to make this analysis based on the Maximum tax bracket in both the Federal and State model and I am going to ignore the slight impact of the lower brackets since it is insignificant within the class of the rich. I am also going to “assume” for the purposes of this analysis that the “rich” in question here are “self employed” people since most of them are such as Moore himself, Hollywood Stars, Rock Stars, etc. These are the rates effective for 2009.
Mr. Moore said that both he and Hannity could afford to have their tax rate “doubled” and that this should happen and would be disappointed if Obama didn’t do this. Although Hannity took him to mean doubling ALL their tax rates I believe that there was a disconnect between Hannity and Moore on this point. I am going to assume the conservative approach and say that Moore was only referring to the Federal Income Tax Rate (if I am wrong and he is suggesting what Hannity thought he heard, watch out, that is a combined tax burden exceeding 100% of income). Since the maximum Federal Tax Rate (effective on income above $372,200 for Married Filing Joint) is 35% Moore’s “doubling” of the Federal Tax Rate would bring his practical “Federal” tax rate to 70%. He went on to state that it was a scandal that “high earners” paid Social Security Retirement tax only on the first $106,800 of earnings with the rest being untaxed. He thought that this was an abuse of the lower earners and a shame on the higher. (He didn’t mention that through the IRS taxation of Social Security Earnings that by far that most of the Social Security payments are made to the lower income earners.) So adding this tax to not only the first dollar but the last dollar of earnings as well brings this component of tax up to 15.3% on all income.
In addition to this we can assume (though Moore didn’t state) that the State Income Tax is still part of the “overall” tax package as it affects the tax payer. States vary in such rates, but since most of the noise on the matter is coming from California, I’ll use their tax rate as the example in this model. That “maximum” tax bracket is 10.3%.
Adding this all up you will get a combined 95.6 % (70.0 % Federal Income Tax, 15.3 % Combined Social Security & Medicare Tax, and 10.3 % State Income Tax-CA).
This 95.6% is simply those taxes based on income and do not recognize Real Estate nor Sales Tax. (Of Course in addition to “income taxes” the Democrats through the voice of Nancy Pelosi are now considering a “National Sales Tax” (VAT) on top of it all.
So, lets take a great income of $10,000,000 for these “filthy rich” celebrities, stars, Entrepreneurs, business owners, etc. So here you have a Gross Income is $10 million and after deducting the taxes that Michael Moore and his ilk have in store for you, your “take home pay” (i.e. after tax income) is $440,000 and you may say “gee that is a good income and so right you may be, but this the amount before further reduction due to sales taxes and Real Estate taxes on those expensive houses, and with that you will probably be in the S300’s take home range. If you are not so talented and only making $5 million per year you can count on a take home pay before sales and real estate taxes more in the low $200,000 range and this is before putting anything aside for Retirement or children’s education (assuming we ignore the VAT tax on top of this all being considered by the Democrats right now). I have to believe that the Jet Fuel for this class of liberal is more than $200,000 per year alone.
None of this analysis begins to approach the element of “risk” that the “rich” must confront in order to develop a business that will earn them a profit of $10 million, $5million or even less. When you take this into consideration you have a situation where nobody would take the risk to develop the jobs that the country needs. At the 10 million level of pre tax profit you might have a Gross business of $100,000,000 with a 10% pre-tax profit (which would be great) and if you were fortunate enough to obtain a rate of return on your invested capital of the lofty number of 20% this would mean that you had “at risk” capital of $50,000,000 to fund this type of operation. In short you are risking $50 million with the hopes in a good year of making maybe $300,000 take home pay. Not me……..and I doubt you would either. I’ll just keep the $50 million risk free and you can look for your jobs elswhere.
Now this is change you can not only believe in, but that you are going to get………………….
“Collective” Praise by School Children
Now back at the Florida Headquarters from Ohio then Nashville (nearly adjacent to the EIB network) J
I wanted to post a personal email I sent to a couple of friends last night that are occasional readers and commenters here at NSL, though not on the flattering side. I have taken the liberty of nominal editing and redaction of some actual personal numbers in this republished letter, but you can trust that they were just the same significant, at least to me.
I’d hope that while the left is taking a page out of the Mao Tse-Tung songbook of “collective” praise by school children for the leader (mmm, mmm, mmm) that some might read the article (below) about the “real world” and learn something about how finance actually works, but then again that is why they say about SOME teachers: ”those that can do, do …. while those that can’t do, teach.” New York is worried and perplexed about why the income tax revenues from the recent piled on tax of the “wealthy” this year is not meeting expectations even after adjustment for the recession. The truth is (and to their future and intensified dismay) because it was enacted just this year the “wealthy” have not yet been able to implement their “end game” economic plans. This year down 20% but look out for additional exodus from New York that will not only erode some of the planned increase, but take money off the table that previously existed under the prior tax structure. You might say, “well, that is a state problem,” but they can’t run away from the Federal Government. This is the naiveté of the left. These people are the primary employers in the country and just watch them move investment & production offshore because of this type of stuff and cap & trade, etc. [Just like Obama did in 2008 with the proceeds of his book sales income invested almost entirely in foreign investments.]
Though just a small player in the financial world, I am a “tax refugee” from Ohio myself. I make most of my income from stocks and the stock market. My margin cost (i.e. investment interest) can run to 50% of my gross proceeds (and has been 80% in the past). Ohio is one state that does not recognize the legitimate expenses of producing income and wants to tax the gross not the net. Even the Federal Government allows this type of expense though be it “below the line” as they say and then they also have an “unfair” “run off” of Schedule “A” deductions and of course taxing the gross through AMT outrage. Any self respecting “progressive” won’t see anything wrong with this at all and others will justify it by accusing and citing what they personally didn’t like about George Bush or some ad hominem comment like that, but the bottom line is this is costing governments “revenues” and they just can’t seem to grasp that.
One example is that I myself now file as a Florida resident (and you can be sure I am dotting the i’s and crossing the t’s religiously on the residency game). I went ahead and calculated my hypothetical OHIO taxes for 2008 (just for personal humorous entertainment since I became a refugee in 2007). Well, I laughed when the computer gave me the answer. Even though the rate is about 30% lower than CA, if I were an Ohio resident in 2008 I would have sent them a check for $XX,XXX. If they had responded favorably and reasonably to my petitions to have margin or investment interest deductible against investment income, I would have only had to pay around $XX,XXX in taxes. A couple of Republicans proposed this legislation (which I think I may have influenced) but the “progressives” shot it down. Their “progressive” ignorance not only cost them the $XX,XXX extra tax they wanted from me but the amount I would have paid if they had allowed investment interest deduction as well. In short they lost it all. You say “no big deal” but remember I am not the only one. I meet “tax refugees” down here all the time. Ted Turner is one by his own admission. (though I didn’t meet him)
If teachers or people want their children to learn something that will be of value apart from some inane mantra about the leader however creepy it may seem, they should teach them the lessons of this article (just think how delicious the response would have been if it were George Bush they were singing about 2001-08). Since people still have certain freedoms the schemes of the left are doomed to failure, but I think they know this and realize that they will have to deal with what we once thought of “as” our freedoms. [just for starters take note of the Baucus health care bill requiring the young & healthy to buy health insurance or pay $3,800 +/- “tax” under penalty of fine and imprisonment in the gulag (most likely un-constitutional now ….. pending future vacancies) in order to subsidize health care for the older and other uninsured (which now looks like will include “illegal aliens” by simply declaring them legal). Just think what a world wide health care magnet that will make us…….we’re so wonderful]
About the article below, read it, memorize it and don’t forget it…………. They already tried this with the aviation and marine industries during Clinton and it failed so badly that Teddy Kennedy led the repeal himself. But along the way it cost untold thousands of jobs and was a “net income loss” for the Treasury. The Democrats bragged about it being a luxury tax on the rich. No “rich” person paid the tax and none were denied luxury yachts or private jets or non-jet aircraft, yet they (the rich) still created a lot of jobs…….overseas. What is it they say about what the deffinition of insanity is? But what the hell, change is coming. (heard that before too) http://news.yahoo.com/s/ap/20090927/ap_on_re_us/us_taxing_the_rich
ACORN’s Shocking Criminal Conspiracy
One thing I found interesting this week. Once Again ACORN is caught with egregious conspiracy to commit a crime this time involving illegally obtaining home loan, Federal Tax Evasion counseling, condoning illegal activity and facilitating human trafficking of alien illegal minors for prostitution and conspiring to prepare fraudulent tax returns to obtain non-withheld credits based on declaration of children in illegal trafficking for “Earned Income Tax Credit” and after multiple indictments throughout the country on voter registration you hear nothing from the beloved mainstream press about the incident ……..and now get this. The (Democratic) officials in Baltimore (the scene of the crime) decide not to investigate ACORN but to investigate the two videographers that set up the sting and recorded the incident. Wonder if they ever investigated 60 Minutes when they did any of the hundreds of similar stings on television. It will be interesting to see if honest people of goodwill allow this stand in Baltimore or if they are all corrupt.
I am sitting back and going to wait for those that respond to this letter by asserting wrongs of the Republicans as though anything is on the same level as Human Trafficking of minors for sexual purposes. Also I am sure the defenders and those that are defenders by their silence see nothing wrong with this because how much less is this than the murder of innocent babies that doesn’t seem to bother them either. Further tax evasion (not tax avoidance) doesn’t seem to be a problem because multiple leaders of the Democratic party practice the same while talking of tax fairness out of the other side of their pocket book. The mainstream press should be ashamed and are fully complicit in this type of activity due to their continued silence in disrespect to their Constitutional responsibility and have in effect provided “safe harbor” for the evil this represents and not inadvertantly. You say it is isolated? ………..and I laugh. I do have to hand it to the Census Bureau who fired ACORN as a contractor for the Census in 2010 as a result of this. I wonder who is going to defend this no matter how circuitiously the defence is postulated.
You say this wasn’t a crime, and I’ll correct you and say it was a “criminal conspiracy” and you might say where was the conspiracy and I’ll say that the person (the ACORN Accountant) that provided most (not all) of the criminal counseling offered to prepare the tax return for a discounted price (for a “new” business) which closed the criminal loop with an offer to participate and induce the crime. This is sort of like the average run of the mill hooker/John sting where they police cannot move until there is offer to commit a crime (description of services) and a price to play.
How criminal must those be in the Administration be that hired ACORN in view of their repeated fraud and criminal indictments throughout the country over the past several voter cycles. Everyone with an ounce of honesty knows this is a politicall pay back off.
It is time for Obama to stand up and condemn this organization regardless of the personal cost it is to his fund raising machine if he has an ounce of integrity. His failure to do so will link to his personal culpability since he has worked so closely with them in the past. For goodness sakes, he has appologized for every other evil as he sees it that he didn’t personally commit since he was inagurated. …….I’m waiting.
Government Ministry of Thought
The White House is now asking publicly for ordinary citizens help it rain in what it calls disinformation about the Presidents healthcare program. They have published an email address flag@whitehouse.gov for people to write to snitch on people expressing their dissatisfaction with the program. Check out this Public Service Announcement by the White House HERE. What has come to this country is CHANGE, but I’d prefer to retain my freedoms such as speech, thank you. It is interesting that from the same people that made sure that George Bush wouldn’t tap the phones of overseas Jihadists calling their operatives in the USA we are getting and executive branch campaign to collect names of dissenters from the Presidents programs.
Anyone that has a bit of common sense can examine statements by the White House and Members of Congress as well as past video comments by Barry and realize that this is indeed designed to move us to a “single payer” Canadian style program ultimately. Their claims to the contrary about the plan is in fact the real disinformation campaign. They are even lying about the language itself that is contained in that 1,000 page monstrosity. But that is what a democracy is all about. People have preferences. If you are for the Canadian system and all that this may mean like Barry, then so be it. But they should be honest about it and not so surreptitiously conniving to force something down your throat through the strategy of dying by a thousand small lashes.
This country is founded the principle of freedom of speech and political thought and it is clear that the administration is trying to crush this. He has ordered his lieutenants to hit back twice as hard. They were smart, they charged the opponents at the Town Hall meeting preemptively with wearing swastikas and rough house and intimidation in disrupting the meetings even though this was not so according to many police reports around these events. This was a couple of days before they launched their own Brownshirt activity by loading the Town Halls with SEIU (Service Employees International Union) and ACORN affiliates to intimidate the old people attempting to enter the halls. Of course those preemptive comments about the opponents would serve to permit the Administration and Democrats in Congress to say the opponents were striking back and making it up. Too bad this time it is on tape.
Reports are that many opponents at many town meetings were told it was full while SEIU members were ushered to alternate doors for entry. This is flat out suppression of speech. This whole thing is becoming rather Orwellian in the manner that Obama is running this thing. This is much like the “Black Panther” intimidation during the election that the White House got the charges dropped on after they got into office. Let me tell you there is one hell of a storm brewing folks.
The most interesting and hypocritical thing of it all is that Barry is calling out those voices of protest as noise makers interrupting his work. These are people that are voicing their objection to his plans. Here you have the Organizer (scratch that) Agitator and Chief that spent his career organizing protest now using strong arm tactics to stomp it out. But I don’t mind in the least, because I believe he is making mistakes that will lead to death (of his Administration). I guess Rush was correct when he hoped for Obama to fail (as to his programs) even though the left media tried to distort the truth of what he actually called for.
Be sure to cancel your subscriptions to all newspapers and periodicals that are supported by the State Controlled Media and be SURE to cancel your memberships to AARP who has sold out their membership in favor of their blind acceptance of this direction. Send the message. Now go ahead and report this “fishy” blog post to the Government Ministry of Thought.
Headed North
We’ll be leaving early in the morning (Wednesday) to drive from West Palm Beach to our Summer home in Ohio. We will likely be off line for a couple of days but could snag a Wi Fi signal somewhere on my wife’s laptop. So we don’t expect to be blogging much. See you when we get to our northern home where we will be until mid October.
My New Blog Address…..
My daughter Elizabeth (Mommy Zabs) pictured here with her husband Jeff has changed my URL to http://nextstoplauderdale.com from http://stevereenie.wordpress.com. She did this work as a Father’s Day Present. She knew I really preferred nextstoplauderdale.com URL. Since the banner name and preferred reference was Next Stop Lauderdale the wordpress domain caused some confusion. I would greatly appreciate it if you would change your bookmarks, links & feeds and for those of you that have included me on your blogroll (I thank you) if you would change that to reflect my new address I would be greatly appreciative. Thanks so much Elizabeth.Some day I will add to my “about” page and try to explain the origin of the blog name “Next Stop Lauderdale” even though my winter home is in West Palm Beach.