On Taxes, Unemployment, and Give-Aways
It sounds like there’s going to be some bi-partisan compromise. But in exchange for keeping lower taxes on “the rich,” Congress will extend unemployment benefits (again), use the Tax Code as Welfare, and throw in a few other sweeteners.
I’m sure today’s Congress wants to extend tax breaks for “the rich.” Aside from many small family businesses that get taxed as if they were individuals, it is the folks like bankers with million-dollar bonuses, lawyers (like those in Texas) who take home $billion-dollar paychecks for class action lawsuits, and doctors (whose fees have increased at over three times the inflation rate for at least recent decade I have been tracking) that are breaking Medicare and MedicAide that contribute LOADS of money to our politicians. They deserve a break (tongue firmly in cheek).
I am wary of the “tax the rich” meme. Back when Reagan eliminated many deductions and vowed to “tax the rich,” I was all for it. Until I found out that, with a $35,000 a year salary, I was rich!
Admittedly, $250,000 a year in Sen. Chuck Schumer’s Manhattan is not a lot of money. Twenty years ago, post-it notes in my Booz, Allen, Hamilton offices on Park Avenue advertised “roommate wanted … $1,200/month!” … to share a two- or three- bedroom apartment. But west of the Hudson, $250k a year is some real money.
Much as I am wary of “tax the rich,” small businesses that can’t figure out how to keep their profits below $1 million, bankers and hedge-fund managers that kept their $millions in salaries and bonuses because of $billions in bailouts from less well-off taxpayers, and a hospital that charges over $400 for a liter of distilled water that costs 88 cents a gallon at Walmart DON’T deserve a break! Those who benefit from the public largess in bad times should pay for it in good (or even better) times.
As to Unemployment Insurance, I am all for it. I’ve been unemployed a few times … only once did I file for benefits, and the unemployment checks that were paid for by the taxes (insurance fees) my company paid during all the years they paid me kept: my mortgage paid, my family whole, and me in beans, rice, and stir-fry for several months. In return, I had to document the resumes I sent out and the interviews to which I was invited every week, for several (3-7) months.
But today’s Federal unemployment extensions do nothing to keep workers looking for work. Quite the contrary, I cite two examples from people I know well:
A 25-, 27- year old girl graduated from college after many years of “study” … she got her first full-time job from a County government, paying roughly $50,000/year. After only a year of salaried work, she was laid off. Since then, she has been on Unemployment for over a year (thanks to Congress). She’s traveled to New England, visited Florida and California, and has generally done things a lot of us would like to do if we had the time or money. She has few expenses, and receives ~$500 per week in Unemployment. She’s physically qualified, but has no interest in taking a part-time (and well-paying) job with UPS or the Post Office over the holiday season. Why work when you don’t have to?
A 40+ year-old man got laid off from his job as a computer operator/network manager, in which he performed well for over a decade. Despite the Recession, his technical job skills are in high demand. Not until the last extension of unemployment was in question did he actively look for a job (after almost a year), and got one within weeks.
Short-term Unemployment assistance is a Godsend for many, but 99 weeks of it is ridiculous! It is Welfare, and even President Clinton realized that Welfare keeps people from working!
There is talk of giving people or families another $400 or $800 “tax credit.” This is not a “tax break;” it is a blatant “stimulus” give-away. Whether you owe taxes or not, the tax-payers get a credit and the non-taxpayers get a check!
I was unhappy when Bush (R) gave me a bonus (but I took it, as did everybody else). I thought that perhaps I and my neighbors had paid for it over the previous boom years. But that wasn’t true … it was pandering. THESE DAYS, I and my neighbors can’t afford to cover the expense … the money will be borrowed from China (if they buy more Treasuries), and our children will have to pay it off. If we don’t borrow it, the Fed will print it, and a wheelbarrow full of dollars will be required to buy a loaf of bread (look up “Weimar Republic”).
Sadly, the IRS is supposed to TAKE money (which we dutifully give, because we tend to be honest and think our politicians are as well). Give-aways (and the Earned Income Credit) have NO place in the IRS … otherwise, it would have been called The Bureau of Benevolence!
In the last eight years, my Senator Cornyn (R) has taken over $2 million from lawyers and and almost $1 1/2 million from the health care professions. Since 1993, my Senator Kay Bailey Hutchison (R) has taken almost $1.9 million from lawyers and more than $900 thousand from health professionals. I’m a simple voter … I can’t match that. I somehow thought that only Democrats were in the pocket of the lawyers and doctors. Obviously, not true.
After years of political animosity, it would be nice if our politicians decided to compromise. Better, it would be nice if politicians actually believed in some of the things on which they once campaigned. The Tea Party Movement promoted some new faces, retired others, and sometimes failed to overcome The Establishment (be it Republican or Democrat). Media would like to say that “Tea Parties” reflect only Conservative (Republican) views, but Politicians (of any ilk) should take note that The People (adhering to both major political parties) no longer believe that Congress is doing The People’s work.
The facade of “compromise” would be a good thing if Republicans said “we’ll increase taxes to pay for all the things we’ve voted for (like 14,000 earmarks)” and Democrats said “we’ll reduce spending on all the things we’ve voted for (like $billions on health insurance [not Care, INSURANCE]).” But this is not going to happen: be it Capitalists or Unions, the Republicans will spend money on the first, and the Democrats will spend on the second; The People (who have to foot the bill) are pawns (or serfs) in a political chess game.