Showing posts with label small business. Show all posts
Showing posts with label small business. Show all posts

Thursday, July 19, 2012

AMERICAN PIES


In Sarah McLachlan's wonderful, double-platinum 2003 album Afterglow, she has a song called "World on Fire".  It is a paean to left wing ideology, with one really standout line:

"The fortunes of one man means less for some"

This is the melodious summation of the democratic argument for reelection in 2012.  It is most often illustrated with the pie analogy the left uses ad nauseum about eeevil rich guys taking huge pieces of the economic pie and only leaving thin little slivers for the rest of the proletariat to squabble over. (by the way, how much is Ms. McLachlan worth again?  More than her sound tech, I bet)

When most world history has dictated that those in power allocate resources, it tends to be an acceptable world view.  In order to to rationalize the deprivation and need that system imposes due to its participants' inevitable gluttonous greed, the theory develops that there just aren't enough resources to give to everyone.  It makes a certain amount of sense.

But here in America, we have a different mentality.  Or at least, we used to.  In America, each and every one of us has the freedom to go out there and...well, make pies of our own.  It's not for us to wait for government to hand out the piddling little slice they deem worthy.  All government can do here is try to limit the size of your pie by, say, demanding the addition of an ingredient that doesn't exist yet or by burdening  you with so many taxes that it's just not worth it to try to make a big pie.  Instead you make a smaller one or use cheaper ingredients or, maybe, have fewer assistants in the shop.

The problem is, the Baker-in-Chief loves pie, and simply cannot resist dipping his fingers into as many as he can, effectively cornering the pastry market by forcing bakers to give more than half of their wares to him.  The cronies and donors get first crack at the best ingredients now and when they burn their pies, he's always there with a fresh one for them, courtesy of the neighborhood housewives.

I find it quite fitting that a symbol of America is apple pie.  Here in America, we don't squabble over crumbs, we make our own damn pie, thankyouverymuch.

Or at least, we used to.  At one time, Susie Jones cooling a prize-winning deep dish caramel apple streusel on her windowsill would have inspired Betsy Smith to make her own mouth-watering creation.  Nowadays, Betsy would call the town council and have Susie's pie removed, citing scent allergies, an aversion to the overt oppression of the patriotic reference to which apple pies allude and a feeling of social injustice and victimization because her oven did not  spontaneously produce a pie when she demanded one.  After rigorous investigation on the local, state and federal levels, Susie and her family are finally left alone to enjoy the forty-seven percent of the pie they are generously allowed to keep (the other fifty-three percent being redistributed to Betsy and other, hopefully more worthy, recipients) and the oven industry has strict new standards for mandatory spontaneous pie manifestation technology within the next decade.  Naturally, a stiff penalty will be incurred if said technology is not implemented within the allotted time.

The biggest problem seems to be that it's not just a matter of fighting over crumbs anymore. More than half of us are telling our government that it's okay to go ahead and help themselves an enormous chunk of someone else's pie so we don't have to be bothered taking the risk of jumping the flaming hoops required for making our own.  We've gone from "I want what you have so I'm going to go out and get it for myself" to "I want what you have so I'm going to take yours".  It's a violation along the lines of what happened to that poor, innocent apple pie in the 1999 movie "American Pie".  It is a defiling of our system, and the inevitable outcome will be stagnation and riots a la Paris and Athens.  When only one pie is allowed, deprivation is sure to follow.

Which brings us to Mitt Romney. He understands that every man is his own baker, and should be able to make whatever size - and flavor - pie he (lawfully) chooses.  He knows that there should be a few rules about baking, such as banning endangered animal meat pies, or using quality ingredients in a clean, safe environment so the consumer and the baker aren't injured.  Such common sense rules and regulations are part and parcel of a well-run workplace.  But government intrusion into every aspect of the baking process is not. 

We really need to get Chef Obama and his inexperienced sous staff out of the kitchen and let the real drivers of the economy - the neighborhood bakers like you and me - get to work.  Here's a hint, Chef - the ingredients you were left with aren't the problem, it's the recipe you insist on following.  That particular souffle will fall every time, as it has in countless state-run kitchens across the globe.

It's time for government to get out of the kitchen and let the bakers bake again.

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Tuesday, August 30, 2011

A BUFFETT OF MONEY


Billionaire hedge fund guru Warren Buffett was the latest progressive recently calling for higher taxes on the rich* with an op-ed in the New York Times (somebody please send him this link).   He claims he only paid seventeen percent in taxes last year; far less than others in his own company:

These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.

Why do they feel so compelled?  Are these "blessings" being showered upon them done out of the kindness of legislative hearts, or could there be other, more base reasons?  Could it possibly be the millions of dollars people like Buffett shower on political campaigns?  Perhaps the one-on-one exposure with certain members of government - exposure of which their own constituents (and the ones who ultimately pay the price for these dealings) can only dream?  Or maybe the odd coincidence of so many former federal employees finding themselves jobs on Wall Street or K Street with the help of crony connections?  A spotted owl is made endangered through no fault of it's own.  The same cannot be said about the 'coddled rich'.  It's called corruption, Mr. Buffett, and you are complicit.

In his op-ed, he raises good points about capital gains and other loopholes but ultimately, he isn't looking for tax reform, he's calling for tax increases. 

Big difference.

What we need is tax reform - removing loopholes and carve-outs and widening the tax base.  So why would he call for tax increases instead?  Well, it seems there is a little piece of information that Mr. Buffett and the NY Times forgot to mention (full disclosure is for suckers).   Apparently Mr. Buffett's company offers certain investment plans that, if taxes were to go up, would see a marked increase in business due to their sheltering natures, and thus a tidy profit for Mr. Buffett.  Who will then instruct his small army of tax attorneys and accountants - who surely couldn't be part of the reason he only paid seventeen percent - to find every loophole possible (conveniently provided by his pals in Congress after some vigorous lobbying) to keep from paying as little of the new taxes as possible. 

What a racket.

Lets not forget, too, that he gets to play the patriotic hero, swooping in to the rescue as well as giving his good buddy Obama a nice little talking point for the campaign trail.  Everybody wins!  Well, except the middle class, whose 'millionaires and billionaires' in the $200,000 tax bracket take one on the chin.

But wait, there's more!

Not only will Buffett profit quite tidily by the increase in business, but it turns out Omaha's favorite son's business has had a bit of a problem paying it's taxes.  It seems that Berkshire Hathaway, Buffett's influential investment firm, hasn't paid it's taxes in almost a decade - since 2002, to be exact. 

Which begs the question: Why, exactly, he is demanding taxes be raised because of 'shared sacrifice', when he isn't even paying what he owes now?

But wait, there's more!

Last week, President Obama made a little phone call to his dear friend Buffett, giving him a heads up on the situation with the floundering  Bank of America.  Buffett had a bathtub epiphany and decided to invest $5 billion (the article is really wonky but highly enlightening)  in the company. Except he really didn't.  Technically, the warrants BofA offered him equals about half the amount he invested - $2.45 billion:


So Buffett is really only injecting $2.55 billion of new capital into Bank of America and receiving $300 million per year in interest (6% * $5 billion). If you divide $300 million by $2.55 billion, you get an effective interest rate on Buffett’s investment of 11.8%. That’s pretty expensive for a bank that claims it doesn’t need any new capital!

Guess what else he got out of the deal?  A nifty little tax break.  It doesn't take an oracle to see why he jumped all over this deal.  Did I mention Buffett is throwing a big fundraiser for Obama at the end of September?  Apparently the party favors will be back scratchers.

The only problem for Buffett is that it is beginning to seem like he is using his reputation of having a nose for deals to promote the Obama agenda and people are starting to question whether his famous instincts haven't been dulled by ideology.  The cash infusion into BofA was supposed to foster confidence.  Instead, there are grumbles about how much trouble the bank is really in. 

With our paychecks shrinking and the cost of goods rising, it's getting harder and harder to pay the bills and put dinner on the table.  Getting lectured by the billionaire buddy of the Spender-in-Chief about "shared sacrifice" as his political connections help him make hundreds of millions of dollars in profits while simultaneously evading taxes is rather hard to swallow.   


*  "Rich"  being 'millionaires' and 'billionaires' making a staggering $200,000 and up.  Also known as making enough to be taxed but not enough to be able to afford the accountants and lawyers to get out of the taxes, like real millionaires and billionaires.  Bye-bye small business and middle class!

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Tuesday, February 2, 2010

SIC 'EM, SENATOR!

Senator Judd Gregg totally tore into Obama's Budget Director Peter Orszag today.  It was great.  I watched it three times and give it two enthusiastic thumbs up!  I wish that more of our representatives would start calling the administration out on this garbage.  Kudos to you, Sen. Gregg!

Orszag was trying to argue that it was perfectly fine to take the TARP money the banks have repaid and 'redirect' it to pay for the small business incentives Obama touted today.  Sounds great, right?  Small business really needs the help, for sure.  But what the administration is doing is against the law.  Yes, help is desperately needed in the small business sector, but there are other ways to do it.

The law, according to Sen. Gregg, who read it out loud to Mr. Orszag, clearly states that all monies recouped from TARP banks should be used to pay off the public debt and for no other purpose. 

Unfortunately, the Obama administration sees this money as their own personal slush fund.

This Presidential Piggy Bank has become their go-to fund for all of their little schemes - most of them involving reelection smoke and mirrors, such as this latest small business salve. 

This administration has an odd habit of giving with one hand and slapping us silly with the other.  The hijinx going on with the TARP funds is a perfect example of that.  With one hand, they are giving small businesses TARP funded incentives, and with the other they are slapping them down with threats of excessive taxation for health care, cap and trade, and the revocation of the Bush tax cuts, among other things.  The increased taxation and regulation will do far more harm than the offered incentives could possibly make up for. 

The level of ham-fisted deceit is just mind blowing.  They are attempting to cloak themselves in populism, of all things -giving the impression of helping out the little guy (with a dash of fat cat banker hating to illustrate the victimhood, of course), when all the while they really have the little guy by the throat, slowly squeezing the life out of him.  It's like a 1930's B movie film noir shakedown.

Which means this newest show of elitist largesse will have the same result as all the rest of their strong-arm, tax and spend tactics - businesses will hunker down even further, refuse to risk hiring and wait for the wave of redistributive taxation recede.

God willing, that wave will break in November.



BTW - Am I the only one who thinks the term "Obama budget" is an oxymoron?

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