« BACK  |  PRINT

RS

MEMBER DIARY

Jet-strapolation

Instead of making populist-style accusations about tax credits to businessmen buying jet airliners leaning to a shortage in weathermen and lack of school lunches (perfectly . . . perfectly natural conclusions there . . .), let’s put on our “not blind and mindless” 3-D specs and examine this desperation ploy in the rational, sensible, conservative way.  (BTW – it is a desperation ploy.  My rogue copy of the Democratic playbook plainly lists in section 12 subsection 2 that ‘should discussions on tax increases hit a wall, exercise the school lunch option.’  And that’s a quote, folks (footnote by Saul Alinsky).

Calculatus Eliminatus

For any Red Staters, moles, mobys, or the like who aren’t familiar, Calculatus Eliminatus was a logically and mathematically-based system developed by one Theodor Seuss Geisel, M.D. (also known as ‘Dr. Seuss’) whereby the best way to “find a missing something,” is to “find out where its not.”  Ingenious.

First I suppose we should identify the “something” that has gone missing. Looking at our economic situation from 3,000 feet, you would have to conclude that the raging and uncontrollable budget deficits – steadily gnawing and gnashing its way into a greater and greater portion of GDP – would point to our missing “thing 1″ – Economic Expansion through fiscal responsibility. So employing the scientifically-proven method of calculatus eliminatus, we can move on the to second leg of the postulate – finding out where its not.  At this point, I think it would be best to hone our scientific inquiry down to specific and measurable instances for the purposes of more immediate results.

The Experiment

On one side, you’ve got a handful of companies and rich guys that would love to own private jet airplanes.  These would increase productivity in terms of multicity or multinational travel, potentially cut costs, or at the very least provide more openings on commercial jet liners which would place downward pressure on ticket costs with more capacity available on the market.  Even at the costs, many neer-do-well business guys and gals identify the benefit of the private jet, and seek the most responsible way to purchase such aircraft relative to their shareholders.  Well LO and BEHOLD there appear to be tax credits that can be taken by some in some situations that would apply to the  partial subsidizing (or more accurately reimbursing) of a purchase of this sort.  So the story in the media goes, “Jets bought using tax payer money.”  That allows a Demagogue type a fairly easy segue into why “millionaires” shouldn’t be offered tax credits for these planes.  Well, let’s just make a little trip to ****fairly world**** and grand that wish.

(((((((((((((((Other-worldly sound effects here woooooWOOOOOwooooooo . . . )))))))))))))))))

Utopia . . . Or a willing suspension of belief

So Calculatus Eliminatus is helping to find the missing something –  robust economic expansion – by identifying all the places it is not.  Specifically here theoretically in tax credits or some business jetliner purchases.  Putting our crack economist on this case (we shall call him ‘Thing 3), we begin to discover the problems with the links made between training weathermen and school lunch programs in regards to tax breaks on jets.  True, if a rich white guy (because you KNOW he is) buys a jet and doesnt’ get the tax break, that’s money that will be added to the federal coffers and can, theoretically, be apportioned to programs such as school lunch or scholarships for students to study meteorology, (or high speed light rail between Vegas and Reno . . . but you get my drift).  So fine, point taken.  Mr. Rich man buys his jet and doesn’t his tax credit.  Mr. Rich Man 2 does the same (probably just trying to keep up with the Mr. Richmen), BUT Mr. Rich Man 3 decides that with economic uncertainties and other market forces, he’s just going to drop his order for the new jet.

WIN WIN WIN , right?  School lunches for all, we won’t have to fear future inaccurate weather forecasts, and 2 of 3 Richie-Richies get to globe trot.    BUUUUUUUUUUUUUUUUUTTTTTT, says Mr. Buzzkillington, we haven’t though through the ramifications for Rich Mr. 3 who decided to pass on opportunity to fly like a G6.  With a little Jet-strapolation, what could that mean?

And once again . . . Trickle Down . . . YES, we told you it works . . .

Without the tax credits, Messrs 1 and 2 paid full price and thus full taxes on their purchases.  Great job.  Mr. Rich 3 paid nothing on his purchase since, well, he didn’t purchase.  So what does that look like?

Let’s start with aircraft company staff.  Business models vary, the the honest truth about things are, if, over a reasonable period of time, you cannot meet performance goals that can be tied to company ROI, you’re likely gone.  I’m sure that Engineer 3 is a talanted person who will find work soon.  However, in the meantime, he essentially ceases having positive earning capacity for a time being, and must look into other helpful avenues such as unemployment insurance, and various other government sponsored programs (remember, all tax payer monies).  At this point, the employee shifted from being a contributor to government coffers, to at the very worst a hand-out.  Washington has lost a Contributor.

But even beyond Engineer 3, who’s got some kind of support system, there are countless others that in deeper peril and in even less position to contribute to the federal treasury.  What about contractors who were to build Mr. Rich 3’s plane.  And the support services that they needed along the way – things as simple as supplies and lunch.  Every transaction results in revenue for state and federal governments.  And many secondary, tertiary, or even farther down the spectrum type commerce occurs to support what has gone on up top. And there are taxes (sometimes double taxes) are paid through every phase of that heirarchy.  Seems to a simple American using Dr. Seuss in complicated mathematical theory that we’re going about this the wrong way.  We want jobs, lets put policies in place that create incentives for businesses to make things. If businesses make things, then they’ll need help in getting parts, engineering, hiring consultants, marketing folks, sales managers, etc.  And guess what – they all pay TAXES!

Take from this what you will but

Seems like a pretty common-sense way to approach things.    What do you guys thing?  @tavernkeeper

 

PS – Apologies for not posting in so long.  As they say I “got buzy” at work and the paying gig takes the front seat.  Thanks all for welcoming me back.

Get Alerts