Politics

Author: Richard R. Tryon and others

Hi all, LOOK FOR THE SURPRISE ENDING BELOW at the end of this section that was triggered by a friend who sent me a story of how in England here in late 2012, the Head of State has discovered that his Parliamentary victory last year to raise taxes on the wealthy, who can afford to give a little more does not work!

It starts with friend Carl sending this unfortunate report of failure in England to successfully steal, err, I mean tax away more from the rich. They have run into what my liberal Economics Theory Professor Titus at Kenyon College called the "propensity to avoid" tax back in 1951!

The modern example is about to be forced on us by the Obama power to contend that he was elected to force those who can afford to pay more, adjust to the temporary conditions that he helped create, and pay more so as to lose their wealth and ability to create jobs. This will leave Obama as the only one who can create 'shovel ready' jobs. Republicans need to find a way to comply but do so in the manner that works the magic of private enterprise that outperforms public enterprise many times over! To keep individual entrepreneurs and investors working we will have to give the President what he wants and will get, but only if he is right!

Surely our President Obama's economic advisors and keen intellectuals like Mr. Geither will accept the following Republican proposal to avoid the Jan 1 'fiscal cliff' crisis:

We Republicans understand Mr. President, your profound recognition of the fact that income redistribution via tax code is an essential part of the litany of a large part of your party's voting group, who pay no tax, and need extra income to add to whatever amounts they have in either their reported or unreported portions. Therefore, we propose a confiscatory tax of up to 100% of all personal income from all sources over a $10,000,000 annualfloor that shall still be taxed at the current max rate of 35%.

How much more than the 35% rate requires a reckoning of how well the individual taxpayer can show that he/she has already done or not done his/her duty, as a wealthy US citizen, to support other citizens and illegal aliens in need of receipt of 'redistributed income' taxed away from the rich. All taxes paid by those reporting such income in excess of the 35% current maximum shall go into a special Obama Redistribution Fund to be divided equally among all citizens who pay no tax because of insufficient income subject to tax.

The proposal requires a careful review of those rich taxpayers returns to be sure that the 100% or extra 65% on top of the normal 35% shall not be exempt from the added surtax for redistribution purposes. To this calculation, we are sure that President Obama wants to be fair. Therefore, monies spent by these super-rich taxpayers that are already going to the same redistribution purposes, or for job stimulus purposes, shall be exempt from having to pay the extra 65% surtax.

Keep in mind that all forms of income over the $10 million taxable income level, be they from dividends, interest income, capital gains, bonus or salaries, shall be subjected to the surtax unless exempted by one or more of the following qualifiers:

a. Gifts of money to domestic servants or others, who provide any personal services to the taxpayer aimed at making the taxpayer enjoy personal enhancements of appearance or feelings of any sort, shall be deemed exempt, as they are personally arranged evidences of Obama-like 'redistribution' of income. Like unreported 'tips', these expenses are essentially deductible, but only from the extra surtax calculation.

b. Any purchases of personal articles aimed at directly or indirectly providing work for those who hold the jobs needed to make, custom build, or otherwise be engaged in the commercial activities related to achieving the purchase shall represent income that is exempt from the surcharge. So, purchase of autos, boats, planes, homes, and other personal assets are essentially providing the much needed consumer demand to maintain and encourage jobs for those needing them so they too can pay taxes to help pay for the vast number ± a small % from the 50% estimated base of such persons. Again, these expenses are essentially deductible, but only from the extra surtax calculation.

c. Any monies paid into corporations or to persons engaged in expanding business enterprises that inevitably cause jobs to be opened with resultant multiplier impact on the economic indicators of such vitals as the perceived level of unemployed, cost of living, and taxable income, shall also be exempt from the surtax. Again, these expenses are essentially deductible, but only from the extra surtax calculation; and all these exempt amounts shall be taxed in accordance with 2012 rules for rate differentials for capital gains, or dividend and interest income, but not bonus or salary.

One might think that these exemptions make a mockery of the notion of making the rich contribute a 'little more', as is so often mentioned in the media, to be an easy task for such persons to handle albeit with negative consequences, because the most important feature to consider is another propensity- the propensity to work! Without these provisions, the rich, like those in England just stop being rich! Why work for income that is not retained as personal savings? If this happens the whole base of 35% tax on the excess evaporates and adds to the national debt unless government expenses are cut.

However, for those anxious to be sure that the rich pay something more, there is a golden provision. You guessed it. Money spent by the rich for non-job producing assets such as gold, silver, or other precious metals, art, or other collectibles is not exempt! So, if a billionaires like Soros, Buffet, Gates, et al choose to invest say $50 or more millions each year in this form of 'hedge' against devaluation of our printed money, they shall have to first pay the extra 65% tax on all such purchases.

So, Mr. President, now that we have given you the means of showing how well you have done at increasing the 35% rate to something above it that will vary with each individual taxpayer in a way that serves your goals, we see only one complication. The unknown factor that the government accounting office can't predict- just how much more income will this wonderful new Republican willingness to permit up to a 100% tax rate on the super rich who fail to do their civic duty of spending their surplus earnings in a way that does not provide for jobs or non-exempt from the surtax fund. The answer is simple. Since all such surtax income is not to be borrowed by other governmental entities, but used solely to redistribute to those most deserving of it by the President's most likely definition, there is no extra income for spending on other programs that otherwise may have to be cut or reduced as part of the grand plan to avoid the 'fiscal cliff' that will precipitate ever greater pain and cascading collapse of the economy that is essential to keeping the incumbents in office.

Indeed we do live in a perilous time and we need to decide: Do we ignore such problems and just print paper money to pay for an ever greater debt to leave to our progeny who will never have to pay for it? What? How can they avoid it? The ultimate task of a future government is to pay off the debt with printed money that is not backed by any bond sale that implies a national debt to the holders.

I hope all will be able at that time to continue to survive in a sustainable way, consuming air, water, and food that each of us has to produce as so little will make it into commercial circulation within a distribution system that is no longer able to operate.

Once we have obtained approval of this not so obvious surrender to higher tax of the rich, we can turn to the other side of the coin- having a nation that once again is controlled by a real budget! This, for some who pay no attention, is the first chance for a real budget since Obama took office in January of 2009.

Without a real budget, the Congress will have to make do with the actions called the 'fiscal cliff'! But, if the President does not show a way to accept a Congressional negotiated budget that fits in the current debt cap, he will be hard pressed to avoid a virtual revolt from all those who work and pay taxes.

It will be his turn to yield to avoid being charged with deliberate national sabotage, an offense that brings on impeachment. We could find out, by pushing for this ultimate surcharge of 100% tax for the super rich with those who neglect to invest in making jobs for the poor that in turn makes tax revenue instead of expense for the Obama government or any other that follows.