Saturday, October 25, 2008

The McCain Deception

I always read my comments and I thank my readers who take the time to leave their observations on my thoughts. I also thank the lurkers; you are also valued.

A comment on my most recent entry, "Erasing the Mark of Cain," caught my eye.

Sharing the wealth would also mean something like this: Say you and I were in college together. You turned down social invitations to events that you would have liked to attended to stay in and study. I, on the other hand, went to every shindig I could find and did not study at all. Come test time, you were prepared, I was not. I made a D, you made an A. But the professor, in an effort to share the wealth, gave me part of your A, and we both made a C, you a C+, me a C-. Acceptable? Not to me. If I work for it, I shouldn't have to share with those who won't work, and essentially that's what would happen.
While I appreciate Meg taking the time to comment, I take issue with her analogy. I understand it, but it's not valid. Sadly, I think that it's the thought process that happens to quite a few people when they hear the phrase, "share the wealth." The McCain/Palin campaign has clamped onto this issue like barnacles on a whale, so I think that it's worth addressing in more detail.

Fortunately, just as I was thinking about writing something in response to Meg's comment, I received a link from a friend to an article by David Sirota that was right on point, McCain Banking on a Confederacy of Dunces. It's a very thoughtful analysis of the McCain/Palin campaign's efforts to scare the socks off the American public by alleging that Obama is a socialist and wants to turn the United States into a clone of the former Soviet Union.

Nothing could be further from the truth and the McCain camp knows it. It's scare tactics predicated on the American public lacking the facts. You know me; I love sharing facts.

According to data from the Congressional Budget Office, the Bush administration has provided $715 billion in tax breaks to those making more than $342,000 per year. That's tax breaks for individuals. Corporations are in a special category. There are all sorts of loopholes that allow some of the most profitable corporations to pay zero corporate income tax. However, my favorite fact is that the government provides various subsidies to corporations that amount to approximately $93 billion annually, about three times as much as is budgeted for the food stamp program. Then there's that recent little $700 billion bailout.

What this adds up to is that the very wealthy often pay lower effective tax rates than their employees. (According to Sirota's article, billionaire Warren Buffet is one of the few who has admitted this.) In addition, corporations like Exxon Mobile that made record profit in its last quarter, don't pass any of that profit along via paying their proportionate share of corporate income tax.

So Meg, when Obama speaks of sharing the wealth, he's not talking about you going out and earning money and then giving half of it to me. What he is talking about is closing the tax loopholes (I think that the more accurate term is black hole) that allow those who are most able to pay to avoid paying their fair share. In addition, Obama proposes that the 95% of Americans who earn less than $250,000 per year, receive tax cuts. No one is proposing taking money out your pocket or mine and handing it over to anyone. No one is even proposing taking money out of the pockets of the 5% who hold the wealth; all that is being proposed is that they pay their fair share instead of being allowed to evade their responsibility through a series of tax breaks and loopholes secured from the U.S. Congress by very well paid lobbyists. 

What McCain counts on is that we do not understand that all of the things that we take for granted, the things that make our lives comfortable, are supported by the taxes that we pay. I like driving on decent roads. My friends with children want to have decent schools for those children to attend. When I turn on my tap, I want the water to be drinkable. I expect there to be law enforcement officers (in uniform because I like men in uniforms) to be there to serve and protect.

By the way, these wealthy individuals and corporations also have discovered a multitude of loopholes to avoid paying their proportionate share of state taxes as well. Ever wondered why so many businesses are incorporated in Delaware? They don't necessarily have offices in Delaware but that's the state where they filed their articles of incorporation. Some 50% of Fortune 500 companies are incorporated in Delaware. The cost of incorporation there is the lowest in the country. You don't have to have any actual offices in the state, just a corporate agent to pay franchise fees and accept mail, so the business may physically consist of a post office box in Delaware. Oh, and the big lure is that as long as the corporation doesn't conduct business activities in Delaware, it doesn't have to pay any corporate income tax in Delaware. So, if a business has all of its offices in my home state of North Carolina, transacts all of its business outside of Delaware, but is Incorporated in Delaware, it doesn't pay state income taxes anywhere! That's a loophole that you could drive the space shuttle through!

The McCain/Palin camp is counting on us being dunces. They think that we can't figure it out and will continue to believe them when they tell us that sharing the wealth is going to result in the advancement of socialism. They think that we will continue to contentedly wait for the trickle down effect to kick in and provide the 95% with our share of the wealth. Well, so far, the only trickle has been upward. The richest one percent of Americans own "more of America's wealth than at any time since before the Great Depression." (Sirota)

By the way, these tax breaks and loopholes are not available to the other 95% of us. You have to have a great deal of money, in order to take advantage of these loopholes! Sending the $500 that I saved over the last six months to some offshore account isn't an option. If it was $500,000, well, then my lawyers could figure out perfectly legal options that would allow me to shelter that income and avoid paying my fair share of taxes on it or perhaps, avoid paying any taxes on it.

Meg, the issue isn't that these wealthy folks earned their money. I earned my money; you earned your money. But you, and me, and the other 95% of Americans have to contribute to the running of this country through paying taxes. Don't you think that the other 5% ought to have to do the same?

You know that I love music; so, I tried to find the perfect song to accompany this post. I initially planned to use Chain of Fools, but then I decided that another Aretha song was even better, Think (Freedom). I like to imagine singing it to John McCain. For the lyrics, just click this link.



Justplainbill said...

Sheria, from one of your ling time lurker. I am usually too lazy to comment.
My only comment today is to thank you for an interesing educational entry.
I don't do politics online but do read a lot of as i come across it. Have a nice weekend. Bill

Beth said...

Colin Powell tried to explain how people need to realize that our tax system is essentially a "redistribution of wealth." Into things like hospitals, our infrastructure, etc.

What so many people don't think about is that those who are making $250,000+ are able to absorb a slight tax increase (we're talking 3% more) easier than someone making $30,000. One of the things I loved hearing back during the conventions was Charles Barkley saying, "I'm gonna be just fine. It's not gonna impact me." He went on to say that he doesn't mind paying a little bit more for people to get good health care, and to make life a little easier for what he called "poor people."

Charles gets it. Why can't other people get it, too?

Great entry. Gee, all I wrote about was French fruit flies. ;)


Yasmin said...

I don't really understand US politics, however you raise points that are universal and valid, if we work we all pay,and Obama is quite right to want to close all the loopholes, however people must remember it's the government that have allowed the 5% to get away with paying less.


Bucko (a.k.a., Ken) said...

The people in the top 5% can easily absorb a 3% increase in their taxes, while the other 95% have a much harder time with simple price increases due to oil, etc.

Thanks for your entry :o)

Bea said...

Perfect explanation... Sheria, you are ever the teacher at heart. I was in Lexington today for the Barbecue Festival, and spied the Obama campaign office off to the side of one parking lot... so off I trotted. I've been wanting some Obama materials. They gave me a vote early poster with his picture on it, and a "I voted early!" button, which I will wear to school until Nov 1st. I also picked up some stickers and pamphlets to give out. I am so excited about this election! Thanks for this entry... and I hope you are having a wonderful week! Loved Aretha! Yes, Think!! bea

Cathy said...

Ah yes, the Queen of Soul, who better to listen to while reading! I have to say, anyone running against the GOP this time out would look great by default lol. Obama I believe has made a few unfortunate choices, but he's young and untried in the area of below-the-belt politics. Once he's ensconced in Washington I'm afraid many folks will be disappointed, which is unfortunate because they truly believe this man will change their lives, and of course, he can't promise to eradicate bigotry or poverty, he can only make educated choices. I see how virulently he was attacked early on for nonsensical things such as his name and religion, but in this country for some, it's anything to keep a black man powerless, yes? But he's already made history and I think the least we can do is help him on his journey, we don't have to support his party or respect the office in a system which is flawed. Much is expected of Obama, I'm anxious to see who he surrounds himself with - the true policymakers - lobbyists with big money influence on the legislature. Either way, this is an historical time and Mr. O is in the venue he asked for. I wish him great public and private success. http://cathy-daretothink/

The Urban Perspective said...

Thanx for sharing "the facts". This piece needs to be posted inside every voting booth next week :)

aims said...

This was a very interesting read Sheria. I appreciate the way you break things down, making it simple for those of us (like myself) who struggle to understand politics. You still have a lot of "teacher" in you. =)

Have a great week!
Many hugs ~

Alan said...


Great post! It's nice to see someone cut through the crap and lay it out for us simple folks.

Had a question come up at home on a political side issue. I'll not ask it here, because it's off topic, but you can join the discussion (or start it) on my post


Claudia's thoughts said...

That was a very good explaination. What I am finding annoying is the fact that we are still hearing about the Corporate HAVES are still getting their bonuses, ever after leading the companies to ruin. I would like to see that "we the people" get our 401's and 403'3 loss reimbursed because of their greed and gross mismanagemet. I, at 62 will have to work longer and the scoundrels get off with millions.

Marc said...

Fine Meg, if you really believe wealth is always accorded to those who work the hardest, then you will agree that 1) inherited wealth should be banned; 2) home health care aides, ditchdiggers, factory workers, peasants anywhere and mothers with small children should be getting the paystubs now going CEOs and executives who may work hard but couldn't last a day picking fruit in the hot sun.
Your analyis is the same self-justifying Darwinism the right has been dishing out for decades.
The real question is what would be so terrible if the "haves" had a little less so that we didn't have "have-nots?" Why doesn't the presence of poverty in the world seem to to bother so many of rich, and even less of those aspiring to be so?

Lynn said...

Thanks for this great educational post. I wish everyone in the whole country would read it. Unfortunately I live in a state full of dunces. (OK) I am amazed at the number of poor and working class people I hear arguing in favor of continuing tax breaks for the wealthy.

Lynn said...

Oh, I also wanted to say that I don't think Obama is going to be a miracle worker. He just happens to be the best man for the job. Things might still be messed up four years from now but I think there's a better chance that things will be less messed up than they are now if Obama is our president.

Rhonda said...

Thank you for explaining that so well. I have tried and tried to explain this to people, but I can't seem to get through. I'm considering just printing out your post and handing it to them..LOL Would you mind Sheria?