Which Way’s Up?

They missed Nevada, Wyoming, Delaware . . .

It seems that the banking laws in offshore tax havens are a little too strict for some in the U.S.   Apparently you have to give your name.  But that can all be taken care of with a simply romp to  . . . .Wyoming?  That’s right.  In Wyoming you can start a shell business anonymously and start a bank account for that business, also anonymously.  From the Economist article:

For shady clients, this is a far better proposition: what their bankers do not know, they can never be forced to reveal.

Ah yes.  Well if there’s a market for such things someone should make money off of it right?  The free market at work.

Nowhere is this more prevalent than in America. Take Nevada, for example. Its official website touts its “limited reporting and disclosure requirements” and a speedy one-hour incorporation service. Nevada does not ask for the names of company shareholders, nor does it routinely share the little information it has with the federal government.

There is demand for this ask-no-questions approach. The state, with a population of only 2.6m, incorporates about 80,000 new firms a year and now has more than 400,000, roughly one for every six people. A study by the Internal Revenue Service found that 50-90% of those registering companies were already in breach of federal tax laws elsewhere.

So all this time our shady citizens were taking their money to Switzerland, while the Swiss’ shady citizens were coming back to America.  

A money-laundering threat assessment in 2005 by the federal government found that corporate anonymity offered by Delaware, Nevada and Wyoming rivalled that of familiar offshore financial centres. For foreigners, America is a particularly attractive place to stash cash, because it does not tax the interest income they earn. Thus with both anonymity and no taxation, America offers them all the elements of a tax haven.

It seems the Caymans were just a slight of hand from the rich, and Obama fell for it.

On the campaign trail, Obama several times cited a single building in the Cayman Islands called Ugland House which notionally houses 12,000 corporations. He said: “That’s either the biggest building or the biggest tax scam on record.”

What about the 400,000 corporations in Nevada?  The 1-in-6 ratio?  That’s either the most CEO infested state in the Union or its the biggest tax scam in history.

Which Way's Up? Obama, Politics Corruption, Obama, Politics, risk-free investments, taxes

Despite his past mistakes, I was ready to give Bill Kristol a clean slate.  Let him forget about the immense blunder that was the Iraq War and focus on his poignant critique of Obama Administration.  My thinking being that perhaps he’s not that good at coming up with policies, but he is good at finding fault in other people’s policy (a common malidy of the right-wing press that is often helpful when the left gains control but a complete disaster when the right is in power).

But of course that was all shot to hell, because Bill Krisstol has a script and God help him he is sticking to it!  Exhibit A:

Never Allow a Democratic Administration To Go To Waste 

Opportunity knocks for Republicans. 

by William Kristol 

Weekly Standard 03/23/2009, Volume 014, Issue 26

Kristol, as always, starts with a back-handed compliment to the opposition.  Referring White House Chief-of-Staff Rahm Emanuel’s desire not to let a crisis go to waste, Kristol writes:

Emanuel deserves points for candor. But perhaps not for perspicacity. 

Candor is something Kristol was never that good at.  His way is better charecterized as muddle and fling poop, with a straight enough face that half the country thinks he’s a lunatic and the other half takes him at his word.  The following is his take on who REALLY wanted to invade Iraq - I’ll give you a hint it’s not neo-cons.

Kristol goes on to write that the opening stumbles of the Obama administration has left their image a bit scuffed up . . . but those Republicans are looking PRETTY good right about now:

Meanwhile, the GOP recovery program is going pretty well. Republicans have progressed from shell-shocked timidity through small-bore sniping and onto robust (and responsible) opposition. The GOP has shown itself able to stand up and counter Obama’s arguments. The Bush hangover seems to be proving less burdensome than expected, and some of the GOP’s members of Congress are turning out to be more presentable than suspected.

I believe this is the sort of shape-your-own-reality thinking that was the hallmark of the GOP going into the Iraq war.  The neo-con argument used to go: “we are mother-fucking American and we can mother-fucking do whatever we want.  AND more importantly whatever we want to happen will happen.  Mother-fucking America creates whatever reality it wants.  Mother-fucking America does not get bogged down in geo-political tensions, or local rivalries, or even cultural sensitivities.  We come in, we blow the place up, we rebuild it the way is should have been built the first time around.”

I bielive that argument has been boiled down to: “we didn’t have the troops to pull it off, but if had - OH BROTHER!”

What’s unsettling here is that Bill Kristol is not being optomistic about a Republican future, instead he’s cramming all the negative GOP press into, “shell-shocked timidity through small-bore sniping and onto robust (and responsible) opposition.”  

The election brought into office a candidate that ran on idea that EVERYTHING that was done the last 8 years needs to be completely overturned.  Whether or not that’s happening is another story, but he ran on that notion.  To not ask existential questions about the GOP feeds into the notion that the GOP has completely lost touch with what the people of America are asking for.  

And has stopped looking at approval ratings.

And has stopped watching the non-Fox news.

Moving forward . . . 

First, Obama is, for PR reasons and PR reasons only (and not very good PR reasons at that), committed to closing Guantánamo. GOP members of Congress can make clear just how dangerous the remaining Guantánamo detainees are, and how irresponsible are some of the proposals for sending them abroad or trying them in the criminal justice system. The GOP should seek the release of the Defense Department report on terrorist acts by some of the less dangerous detainees released from Guantánamo under the Bush administration. Republicans can seek to slow or reverse Obama’s decision, requiring that he certify that closing Guantánamo will not endanger American lives, providing funding for Guantánamo in the budget whether or not Obama wants it, and so forth. Lots of Democrats would have trouble opposing such efforts.

Polls will be helpful here, again.  Forty-four percent of Americans agree that Gitmo should be closed.  Not a deal breaker.  In fact, only 35 percent of American’s believe that the governement should fund family planning over seas, but that won’t stop Democrats from removing the “gag-rule.”

Moreover, the PR reasons Kristol scoffs at, are part and parcel of why terrorists have grown stronger under Bush.  The Islamic world doesn’t hate us because we like freedom and democracy and nearly-naked women in our magazines.  This is of course distasteful to them, but you will not find many Muslims joining the terrorist cause because of our life-style.  Instead the Islamic world hates us because of the ACTIONS OF OUR GOVERNMENT.  Including the BAD PR OVER GITMO.  Gallup illustrates this point.  In most of the nations of the Middle East surveyed the top three things the U.S. could do to improve their image are, 1) Pull out of Iraq, 2)Remove military bases from Saudi Arabia, 3) Close Gitmo

The top three U.S. actions to improve our PR in the middle-east and Kristol scoffs at it.  No amount of extra-judicial killings, imprisonment without trial, or invasions of sovereign nations will stop terrorism.  But good PR can and does cut the legs out from under terrorist recruitment.  And Kristol’s against it.  Is he wrong on every issue?  No it just seems that way, because he’s wrong on all the important ones.

Second, what’s now the rationale for discriminating against ROTC on elite college campuses? The “Don’t ask, don’t tell” policy? Well, Obama is president and the Democrats control Congress. They can change that policy if they want to. 

Absolutely!  But I’m sure Kristol will come against a change in the policy when Obama decides to tackle it in his second term.

Which Way's Up? Obama, Politics Bobby Jindal, fresh faces of the GOP, Obama, Politics, Republicans

Jim Powell is Senior Fellow at the Cato Institute, which puts him in the same category as these intellectual heavyweights.  Don’t get me wrong, I respect libertarians and agree with them a lot of the time (Cato is anti-Iraq war, anti-drug war, anti-patriot act), but constricting yourself to one narrow ideological idea often requires you to defend the seemingly indefensible from situations that 98 percent of Americans could not possible relate too.  Here is Jim Powell trying to rally the poor in support of the rich - because they need liberty too.  Read the entire article here.

Obama is continuing the crusade against offshore tax havens he began as an Illinois senator. He’s targeting places like the Bahamas, Cayman Islands, Isle of Man, Liechtenstein, Luxembourg, Malta, Monaco, Netherlands Antilles and Switzerland, which have low taxes.

Tax havens, international money laundering hubs and beautiful vacation spots, everyone of them - except Liechtenstein, but its fun to say so I could see traveling to Switzerland, just to ask directions to Liechtenstein.  (Side note: A fun drinking game is to chug a beer and say Liechtenstein and then repeat.  I guess its not a game so much as binge drinking.)

It’s wrong to think that a U.S. crackdown on offshore tax havens would primarily hit disgraced Wall Street high rollers who made fortunes peddling subprime securities. These tax havens are used by many of the biggest U.S.-based corporations to help minimize the massive tax liabilities imposed on multinational operations.

Won’t someone please think of the corporations!

To the extent these corporations are able to minimize their tax liabilities — along with other costs of doing business — their profits and stock valuations are higher.

I’m no high-priced crooked corporate accountant, but I’m pretty sure the government doesn’t tax losses.

Shares of these corporations are in millions of individual retirement plans as well as the portfolios of colleges, universities, insurance companies, hospitals and charitable institutions.

Ah yes, the “we’re crooks, but we did it all for you” defense.  I understand that about half the households in the U.S. own stock, but most of that is through employee sponsored retirement plans AND the ownership level drops off heavily in lower income households.  Yes higher shareholder value is good for everyone, but in a market that was primarily characterized by greed and crooks, I think some restraint is in order.  But don’t worry rich people, your super-expensive tax lawyer will find you a loop-hole, that’s what he’s paid for.  

Why would Obama choose to attack stock valuations now, after the stock market has already lost about half its value during the past year? Why, when the country is in a serious recession, investment portfolios have been hammered, the banking sector is in turmoil, and unemployment rates are rising, would Obama make it harder for U.S.-based corporations to do business?

Because he’s a socialist, haven’t you heard?  This is all part of his master plan to re-animate Lenin’s body so that he can “Crush Cap - i - tal - ism!”

Obama’s concern seems to be that corporations aren’t paying their fair share. But corporations don’t really pay taxes anyway. Corporate taxes are passed through to consumers like other costs of doing business — factored into the price of goods and services.  Trying to suppress offshore tax havens means generating upward pressure on the prices Americans pay for food, gasoline, clothing, computers, pharmaceuticals and thousands of other products that affect our daily lives. Why would Obama do anything to make life harder for American consumers in already tough times?

You got me there.  Maybe he’s just a D-Bag that hates us.  Oh wait, I know why, because he’s taxing profits, so instead of raising prices to keep their profits up, corporate big wigs could just take home a little bit less than a biggilion dollars.  Also, the biggest problem in this market is deflation.  This is a buyer’s market, so prices are in a downward spiral.  In fact a bit of upward pressure on prices could be a good thing for all of us.  

Moreover, corporate taxes amount to double taxation. Profits are taxed at the corporate level, and they’re taxed again when investors receive interest on corporate bonds, dividends on corporate stock, or when investors sell stock, bought with personal income previously taxed, that yields a capital gain.

Don’t you think the rich have been taxed enough.  Moreover, don’t you think compensation in the form of stock options should be essentially free?  I know the rich do.  Then they can finally fire some of their high priced tax lawyers.  

By reducing after-tax returns from investment, Obama will discourage investors from making their funds available. For all practical purposes, investors could go on strike as they did during the 1930s when a succession of soak-the-rich taxes made it hard for investors to estimate their risks and returns, and they remained on the sidelines. Without more capital, it’s almost impossible to create more private sector jobs.

I’m so tired of the” taxes on top-incomes held back recovery from the Great Depression” argument.  Taxes in the U.S. were historically high in the 40s through the 60s, a pretty prosperous time if I remember correctly.  In addition, FDR raised taxes from a top marginal rate of 25 percent to 65 percent.  Obama’s going from 35 to 39 percent.  That’s lower than all but 13 months of the Reagan administration.

Obama’s populist rhetoric suggests that he’s only going after the super-rich. Yet reportedly half of individuals earning over $250,000 a year are small business owners. During the past 15 years, small businesses have been creating over 90% of net new jobs — altogether, more than 20 million jobs. How smart is it for the heavy hand of government to come down on these employers?

That was debunked a while ago.  I feel bad for the guy I really do.  But someone has to step up the plate and fight for Goliath.  Talk to me when you’re working on Drug War reform.  I’ll be sure to give the Cato Institute some good will then.

Which Way's Up? Politics Obama, Politics, taxes

According to Dana Milbank, it seems that President Obama offered a hand shake to Gordon Brown and then at the last second pulled the hand away and ran his fingers through his hair, uttering “too slow.” This was followed up with Obama pointing out a stain on Gordon Brown’s tie with his finger and then sweeping the same finger into the Prime Minister’s face, when Mr. Brown looked down. Obama finished his shameful display by suggesting that Mr. Brown’s wife “must have been something before electricity.”

Wait . . . I’m getting word that that is not the video of the Obama-Gordon meeting in the Oval Office. Let’s what embarrassing acts are found in the real video.

Well! I never!

Which Way's Up? Obama, Politics Gordon Brown, Obama, Politics

You can’t get anything past the investigative journalism team over at Politico. While the rest of the nation was floored by the realization that Barack Obama was in fact a black man, POLITICO (which recently changed its name from Politico to POLITICO on the internet, presumably as an overture to the hard of hearing as well as foreigners) was deep into uncovering this mystery through out the campaign. It seems that Obama was sending secret coded messages to the black community that he was indeed one of them, all the while hiding his “blackness” to white America with extensive research and regurgitation of stuff white people like.

Reading through the official list of stuff white people is like reading through the obama campaign playbook. #1 is coffee. Search “Obama and Coffee” in google and you get 28 million results. Coincidence? I think not. In fact he followed the list so closely that he made it onto the list at #8 on January 19th 2008.

Having sealed up the white people endorsement, Obama proceeded to inform black people that he was indeed black. From POLITICO:

On matters of racial identity, many observers in the African-American community say he benefits from what’s known as “dog-whistle politics.” His language, mannerisms and symbols resonate deeply with his black supporters, even as the references largely sail over the heads of white audiences.

One of those references that sailed over the heads of white audiences was the color of Obama’s skin.

More from POLITICO (I apologize for shouting at you who are not hearing impared or foreigners):

John McWhorter, a linguist at the conservative Manhattan Institute, said that he believes that in Obama’s case coded messaging, which can be a matter of words, sound or grammar or all of them, is partly conscious because “he knows it arouses black audiences.”

“Black English, especially the cadence, is becoming America’s youth lingua franca, especially since the mainstreaming of hip-hop. Its sound conveys warmth, authenticity and a touch of seductive danger not only to blacks but many whites, especially ones below about 50,” McWhorter said. “Obama’s tapping into that cadence helped win him the election. Imagine John Kerry or Hillary Clinton saying, ‘Yes, we can!’ It would have sounded phony — only in what I call a ‘black-cent’ can it sound prophetic and arousing.”

And only in a “white-cent” can this not sound ridiculous:

Here are the secret messages spliced together. See if you can decipher what Obama’s really saying.

Which Way's Up? Obama Obama, POLITICO, Politics, ridiculous

Give me a minute . . . I'm thinking of ways this is wasteful spending . . .

To the delight of confirmed marxists and the dismay of “real” Americans, Obama issued his ambitious, proletarian-revolution-leading budget today.  Dropping all pretense that he is not a Soviet spy from the past sent here as a manchurian candidate to destroy America’s capitalist paradise, Obama included in his budget billions for the renovation of statue park  and the restoration and modernization of Comintern headquarters to include larger Comintern posters and a swiffer sweeper for Lenin (it cost billions because its globe-sized).  This will inevitable lead to a middle-American revolution with a Bobby Jindal inspired rallying cry: “Chemical Castration for all!”  The system simply was not built to handle this much change.

whichwayisup Politics Bobby Jindal, Obama, Politics, Republicans, ridiculous, Stupid

Fox finds itself in another epic struggle with the facts

Fact checking has quickly become a media favorite, but some news outlets with a passing familiarity with facts have struggled with this concept.  Fox News put together this admirable effort that uses both hands and a professional train packer to shove words in Obama’s mouth instead of you know, checking the facts.  Here’s a taste:

OBAMA: “We have already identified $2 trillion in savings over the next decade.”

THE FACTS: Although 10-year projections are common in government, they don’t mean much. And at times, they are a way for a president to pass on the most painful steps to his successor, by putting off big tax increases or spending cuts until someone else is in the White House.

Obama only has a real say on spending during the four years of his term. He may not be president after that and he certainly won’t be 10 years from now.

What fact did you check exactly?  The fact that presidential terms last 4 years.  The “fact” that Obama is putting off huge tax increases and painful steps?  What about the $2 trillion?  Is he pulling it out of his ass?  Or has Obama pointed to spending decreases and Fox doesn’t believe him? 

OBAMA: “Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn’t afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day.”

THE FACTS: This may be so, but it isn’t only Republicans who pushed for deregulation of the financial industries. The Clinton administration championed an easing of banking regulations, including legislation that ended the barrier between regular banks and Wall Street banks. That led to a deregulation that kept regular banks under tight federal regulation but extended lax regulation of Wall Street banks. Clinton Treasury Secretary Robert Rubin, later an economic adviser to candidate Obama, was in the forefront in pushing for this deregulation.

Yes, this is entirely true.  It was under the Clinton Administration that the financial regulations and markets were liberalized.  It was with a Republican Congress.  There’s blame on both sides.  So where did Obama say that only Republicans were to blame.  To me the overreaction here is more telling than the fact checking.  The Republicans were in power for so long that their mantra is well know by all and is clearly being tested today.  Therefore, Obama doesn’t even need to accuse them of anything.  It’s the old detective trick.  Tell the suspect that the victim was brutaly bludgeoned and wait for them to deny vehemently that they even own any bludgeoning tools.  ”I don’t even know how to properly throw my wait behind a 10 lb sledgehammer.”  To which the detective coyly responds, “I didn’t say anything about Republicans profiting from an economic meltdown.” 

Here’s what a real fact check looks like.  What do you think?  Are you planning on enjoying the right squirm for at least the next 2 years?  Hoping that Bobby Jindal makes it to a debate with Obama?

whichwayisup Politics Economic Meltdown, housing, Obama, Politics, Republicans

I have here in my hand a speech delivered before Congress, and on the campaign trail, and in Europe, on prime-time TV several times before the election. . .

President Obama’s speech to Congress last night has elicited praise from unlikely sources.  Dick Morris heaped plaudits on the speech by the dump truck full - by which I mean he refrained from calling Obama a socialist.  

WITH a speech to match the most eloquent os [sic] State of the Union Addresses, with strains of FDR and JFK and a touch of Winston Churchill thrown in, President Obama has clearly staked his presidency on the outcome of the economic crisis.

Really?  I was pretty sure his presidency was about socialism - you know the big brother, no freedom, socialism we were scared up to believe was his hidden agenda?  The “European Socialist” conspiracy that implicated Gordon Brown?  (starts around the 0:50 mark) 

Oh wait here it is:

Halfway through the speech, the president got to the minefields of Social Security and health-care reform. He avoided any specifics, but it’s clear that he plans to salvage the former with increases in the payroll tax and implement the latter by government rationing of health care. If you like your HMO, you’ll love Obama’s health plan.

That’s the same clues I picked up on.  Like when Obama said “Thank You Madame Speaker,”  it was clear that he plans to raise capital gains taxes, while trampling a bible.  

But really Dick, in that stimulus bill you hate so much - the major tax cut was a PAYROLL TAX CUT - so the little birdie that told you they are going up was just trying to make you look stupid.

More importantly, Dick’s pissed that his taxes may be on the way up:

And then Obama affirmed that he’ll support big tax increases on the richest 2 percent of American families. Disregarding the fact that these households already pay upward of half of all income taxes, while earning only a quarter of the national income, he has singled out the entrepreneurs, professionals, innovators and businesspeople of America for taxation.

Although I don’t see how he fits into those categories that Obama is singling out (I think professional wind bag needs to be added), Morris is seriously pissed that the top 2 percent ONLY earn 25 percent of the income.  Maybe this will cheer him up (Share of Net Worth, 2004, halfway down on the right).

Oh, but he won’t raise taxes until he’s had a few years to stimulate the economy. How many in that 2 percent feel like one of those huge hogs in the Chicago stockyards, being fattened up to slaughter the next year?

It’s the French Revolution all over again!  They did eat the aristocracy in the French Revolution, right?  

So all this is so scary to Dick because people voted for it, they expect Obama to follow through on his promises and he reaffirmed his commitment to those promises.  Right?

This speech will be viewed as his high-water mark - the time before we came to realize how flawed is his understanding of economics and how supreme is his commitment to expanded spending. It will be seen as a sort of age of innocence before we realized what he had in mind.

No, it is a secret socialist conspiracy after all!  Whew, I thought for a moment that this “center-right” country voted for an out-and-proud communist.  Good to hear that we were simply duped.

whichwayisup Politics Dick Morris, Economic Meltdown, Obama, Politics, Republicans, Stimulus

Following President’s Obama ambitious outline of national priorities, the Republican response was delivered by Kenneth the Page - I mean Bobby Jindal.  In a stiff response delivered following a “something up my butt” walk up to the camera, Kenneth, I mean Bobby, made sure to touch on the important issues of the day - like don’t you think taxes are still too high and the left still thinks America sucks.  

In a response so disjoint from the President’s actual speech it seemed to have been recorded last week, Jindal clearly showed that people can’t trust the government because you know Bush fucked up Katrina.  He failed to mention that Bush fucked up the war too, but we still have to trust the government to take care of national defense.  Or maybe we shouldn’t.  The power of Jesus and the Magic of Capitalism will vanquish our enemies for us, Miss Lemon - I mean America.  

Thanks to Sadly, No! for the follow through

But let the main point be crystal clear, we can never trust the government to allow us to save our own friends from drownding, without getting insurance companies invloved.  Yeah, I don’t really get it either.  Anyhow, let’s buy up all the guns in the county and retreat to our bomb shelters.  Oh wait, no.  He advocated more tax cuts.  Shunning the old adage - fool me once shame on . . . shame on you . . . you can’t be fooled again - he retreated back to the old pool of solution on the right that has been drained out to the only popular solution left - paying off voters with tax cuts.  I can’t wait for more from Kenneth, er Bobby later.  

Jindal Responded

whichwayisup Politics 2012 elections, bailout, Bobby Jindal, Economic Meltdown, fresh faces of the GOP, Obama, Politics, Republicans, ridiculous

Speculating that President Obama’s Housing Plan will create a nation-wide false-bottom on the housing market, many entrepreneurs have invested heavily in the false bottom industry that is intended to boom in the near to mid-term.  Their money has been funneled into areas as varied as desk drawers with a false bottom to magicians wardrobes with a false bottom.

Dave Profitiy, a venture capitalist from Seattle has poured 70 percent of his capital into false bottom making and utilizing businesses.  He insists that the risks are inconsequential, but the potential benefits are astronomical, “You’ve got false bottom wardrobes, tables, stages, hats, pockets, vases, what have you.  And that’s only magicians we’re talking about.  Then you’ve got your false bottom paranoia, you know for the rich to stow away their valuables.  Which leads into home furniture: coffee tables, bookshelves, sections of the flooring.  I mean there’s no end to the possiblities.  And moreover, in our lifetime the price of false-bottomed things has never gone down.  My projections are telling me that this is going to be a $4 trillion dollar business in 3 years.  You don’t want to miss out on this!”

Still others are focusing their investments more narrowly.  Jacob Moneyton, an investment banker in London, sees the U.S. Housing bailout as creating a whole new industry that didn’t previously exist: “So this housing bill is intended to help those that could be reasonably able to pay their mortgages with a slight decrease in monthly payment, right?  Well that still leaves a vast sea of humanity that has no chance of paying off their mortgages as they fall deeper into debt and their mortgages go deeper and deeper underwater.  This means the people on the false bottom will have water to float on, which means they will undoubtably want to see the source of the economic meltdown they are living in.  That source though is underwater.  THEREFORE, the hunger of econo-meltdown tourist for scenes of the meltdown will give rise to what I like to call ‘Why are we fucked?’ tourist.  And why we are fucked is underwater mortgages.  THEREFORE, we need glass bottom boats to let the tourist see underwater mortgages from the false bottom that they are happily floating on.  I can see it now, people lined up around the block waiting to get a glimpse of just how fucked we’d be if there wasn’t this false bottom to float on.  

And it doesn’t have to stop there.  I’m envisioning underwater hotels with views of the abysmal state of affairs below the false bottom.  This is guaranteed to make money risk free.  What do you say can I count you in for 10 grand?”

whichwayisup Politics bailout, Economic Meltdown, housing, Obama, ridiculous, risk-free investments, Stupid