Comments by "Ralph Bernhard" (@ralphbernhard1757) on "Hoover Institution"
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At http://www.youtube.com/watch?v=4sM5sQIZXlg&t=9m45s mins
Look how they quickly change the criteria.
Obama asked why 'Warren Buffet's secretary should pay a higher personal income tax rate than Warren Buffet'.
Then, these two gents laugh about it, but quickly change the criteria to 'who pays the most income tax?'
No, it's about the rate (10, 15 or 25 % of total income), and NOT where the government gets the most money from.
Yup, of course the most INCOME tax comes from a mega rich, but these mega rich also make the most money.
Why try to stick to 'income tax' only?
Why not look at taxing in general, as a proportion of income?
Seen as a percentage of income, even those who pay NO income tax (because they earn too little), pay a lot of tax as a percentage of what they earn.
For example, the 50% gasoline tax, or sales tax (7-10%) would cut 'Joe the plumber' deep. Yet, the mega rich Wall Street banker laughs at the (seen as a percentage of his income) 50% of his gas tax.
If Warren Buffet pays 30 dollars of tax on a 60 dollar gas bill, he'll laugh it off.
For a low income family, 30 dollars of taxes on a tank full of gas, is a much, much higher percentage of their total earnings.
Of course, you'll NEVER find a 10%-er from the upper income bracket, arguing that the 90% of average and low income families pay the vast majority of fuel and sales tax.
Hmmm....
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pebutts Thanks for your input.
The reason I posted, is because I recognize a certain justification made by those who are better off, when determining the criteria used in this debate.
First off, why limit the debate to personal income tax only? Why, if the question of 'taxation' arises, immediate point the finger at the overall amount generated by a single tax, if there are hundreds of different forms of systems of tax?
You seem to be very knowledgeable about the subject, so let's admit to a few facts first. Let's also not limit the debate to Buffet (a man whom I admire BTW, for his savvy and because of his philanthropic side) and his secretary, who were only examples used by Obama to address a wider problem.
Firstly, there is hardly a wealthy person on the planet, who is not ALSO a company, or several companies, at the same time. This fact already offers massive advantages of ' shifting' money around. Extremely wealthy people keep money invested in firms, company funds and accounts, etc.
As a 'mere' average bloke, if I sell my shares with a profit, get dividends, etc., I immediately have to cough up the taxes due. Not so, somebody with much more money than I do. That person would use the methods made available to him by ' the system', and found a company. As you know, companies have all the benefits of using bookkeeping tricks to artificially reduce the 'profit'.
Therefore, if I get a few thousand Euro in dividends, I ( as a private person) IMMEDIATELY pay the tax due.
With a person who has more money left over to invest in stocks and shares, and collects several hundred thousand, won't get paid directly. These dividends first flow into a 'company', where it is then handled in the usual profit and loss manner. In end effect, the 'businessperson' pays a lower rate overall, despite the added costs involved in running a company.
I know what I'm talking about, since I was the PA of a rich family here in Europe for a long time, and I can add up the sums myself :-)
Of course, the overall amount paid by ' rich folks', is still higher, BUT as a percentage of overall income, it is lower.
The taxation on fuel (50% for some US states) is about right. I didn't work out the exact average of all US states though, because I was merely using it as an example to illustrate a problem. I quickly googled it before I wrote this essay. If I remember correctly, some states had rates as low as 35%, other states were much higher. Over here in Europe, rates are as high as 60%.
All of this is beside the point though.
Look around you on the streets, and then determine that the most cars that you see belong to lower and mid income citizens, who also do most of the driving, and therefore use most of the fuel. If they use most of the fuel, they also pay most of the taxes generated by the sale of gas. Correct?
However, you don't see a lobby for low and mid income citizens trying to limit the debate to gas taxation ONLY. You don't see average Joes pointing out how they pay most of the gas taxes generated by the government, because it benefits their argument. You don't see a low and mid income citizens lobby cherry picking criteria which makes it look as if they are being treated unfairly.
This is my only point.
It's the 'whiney super rich', complaining about how the unfair system is milking them, when the reality is that they actually already have 'the system' on their side. It's system which affords the really affluent to shift money around, to avoid what most others have to do AT ONCE. That is to pay their taxes, the moment the income is generated, or a service is paid (VAT), without the benefit of getting some of that back at the end of the year with a MASSIVE tax return.
And, again, I worked for 'rich folks' long enough to know exactly what I'm talking about...
Furthermore, how many of these low and mid income citizens (like 'Buffet's secretary') have a company along the side, under which they can balance the income generated by the dividends they earn, and can 'juggle the figures' in order to evade immediate payment of taxes?
But, how many '10%-ers' make use of this opportunity?
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In 1938 an opportunity arose for Hitler to implement a limited war against Czechoslovakia. Moscow was occupied by a border conflict with Japan in the east (Lake Khasan/July 1938), and a silent threat hung over London/Paris, by the presence of the Legion Condor (Gibraltar). An army of 15,000 men, with tanks and air support....
That window however, closed as quickly as it had appeared when the battles in the East did not result in a full-scale war, and Hitler grudgingly accepted Chamberlain's offer to negotiate a settlement (since he had already started brewing trouble with Heinlein in the May Crisis).
The threat of a 2-front war for Stalin not materializing in 1938 (war with Japan) was the determining factor for Hitler to accept talks about the future of Czechoslovakia.
Hitler didnt have a choice but to dump Case Green (Invasion of Czechoslovakia). Hitler chickened out at Munich, NOT London/Paris...
Oh, and that "I saw my enemies at Munich", and "they are worms".
LOL, just the typical face-saving tough talk of a despot who feared losing respect from his assembled "yes men". He voiced these opinions to his inner circle, as a way of covering his obvious embarrassment of having to bow to the "soft talking", but "big stick carrying" man with an umbrella....
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arealbabycthulhu My comment is about past history, from which we should draw objective conclusions for future actions.
What we see happening now is the result of a hundred years of (mostly) western meddling.
Most people in the world are decent.
Leave them alone, to sort out their issues without interference from outside, and there will be peace in the world.
The UN is a failure in this respect.
It cannot stop foreign interference in local matters, leading to strife, affront, uprisings, and sometimes war.
The weak nations in the world are merely a battlefield for the ambitions of stronger outside powers.
The only answer is a stronger UN, with executive powers, NOT ever more national arrogance and meddling.
If we cannot accept that change is necessary, then change will not come.
If change doesn't come, we should stop whining about the results of our own actions....
ISIS does not represent the will of a majority of the local population, which social structure has eroded as a result of the US and British decision to invade Iraq in 2003. It is an entirely home-grown problem.
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arealbabycthulhu OK, so let's change to the present.
Radical Islam is an ideology.
It doesn't appeal to a majority of Muslims, who are actively collaborating with the west in efforts to contain it.
Therefore, the first thing to realize from past history is that ideologies can NEVER be 'exterminated' or 'stamped out' completely, because it is inside the heads of people.
Even during WW2, and against populist belief, Nazism was not 'exterminated' or 'stamped out'. What WW2 achieved, was to remove Nazis from positions of power, and remove Nazi advocates from positions of influence, from which they could meddle behind the scenes in order to create the world they personally adored (against the wishes of a majority).
The same is true for any ideology which does not conform to the desires of the decent majority of all people.
What history has taught us is that ALL ideologies which are opposed by majorities, will eventually have to bow to the wishes of the decent majority. That is what happened to communism. Since it had to be enforced or imposed from the top down, and had no support from a majority unless imposed on this majority by force, it disappeared when this force weakened.
The same is true for radical Islam.
First fact — it will always exist. We can't 'bomb it to oblivion' or stamp it out. The only thing we can achieve is to remove radicals from positions of power and influence, as once happened to Nazism and Communism in eastern Europe.
What we should try to achieve in the long run is to create a barrier between average decent law-abiding Muslims and the ideologies of radicals.
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Concerning Appeasement
Is it only me who is getting tired of these posts which constantly turn up on videos dealing with appeasement ? (aka 'compromise). Specifically Hitler and Chamberlain.
Right wingers just love stating that 'they should have read Mein Kampf' .
The answer to that rhetoric is simple. They didn't. It was a stupid book, and therefore only very few people actually read it cover to cover.
Other posts on videos like this, often express the opinion that 'if there had been a Churchill in power in 1935 or 1936, we would never have had a WW2'.
The insinuation is that it was 'weeny liberals' like Chamberlain who constantly appeased the fascist dictators, which led to (i.e.) Germany gaining exactly that power which was later turned against the West. The conclusion generally reached (using the often frowned upon hindsight) is that 'if we had stepped in, in 1935 or 1936, and invaded Germany, none of this would have happened'.
Having 'a Churchill' in power, mostly plays a large role in these assertions, and certain amount of hero worship plays a role.
These assertions, are however, entirely contrary to the facts and evidence, and is therefore an assumption/conclusion based on the poster's personal mindset.
Here are the facts.
The conservative British politicians generally did not oppose fascism, as long as (and for the duration of time) it did not represent a direct threat to British interests.
Churchill himself, was largely indifferent to the fascist governments in Germany and Italy, until he swung around and recognized the danger they posed.
In order for Churchill to do an about turn, he would have needed to have had a more reserved standpoint before that point in time.
Evidence of Churchill's standpoint towards fascism, and one could even say a certain measure of support, is his reporting on the Spanish Civil War as a writer to conservative British newspapers.
At the early stages of the war, Churchill was completely in line with conservative British political opinion, in that he recognized a danger being posed by the (legal) Republican side (NOT by Franco). Since the Republican government was seen as 'communist' (leftist), the conservative British elite feared for the status quo concerning British interests (economic, trade, etc.) Churchill was therefore in line with conservative opinions at that time, which expressed a general support of Franco, and the forces which supported Franco.
Around the middle of the Spanish Civil War (around late 1937), Churchill began changing his mind, and now expressed a more neutral point of view.
He was still not firmly against the German and Italian intervention.
It wasn't until the the final stages of the war, by which time there had also been general swing in public opinion in GB, that Churchill finally changed his mind, and was firmly against the fascist intervention. Again, this had nothing to do with any concern for the Spanish population, but rather a concern about British interests.
Therefore, a statement like 'we should have invaded Germany in 1935 or 1936', makes absolutely no sense at all. One would have to admit that even Churchill recognized the danger posed by fascism far too late, since by late-1936, Germany and Italy were allies (the Axis Rome-Berlin), and any invasion of Germany would have meant a wider European war, the results of which would have been even more catastrophic than WW1.
So, Churchill only changed his mind about the danger posed by fascism, and Hitler in the course of late-1937/early-1938.
My personal conclusion?
Maybe Churchill should have read Mein Kampf :-)
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At 15:17 minutes.
'..the Poles probably would have...', and Hitler would have been turned back.
...and here is where they are wrong.
For all of those a who think 'a Churchill' would have been better for GB and the world in 1938.
First off, 'a Churchill' would have taken one look at the French army, safely dug into their Maginot Line, with their Maginot mind caps firmly in place, and thought '....advance to Berlin with those chaps? No way....'
An alliance with Poland? LOL, they already had one.
What next.
Maybe an alliance with Stalin, to create a two front war for Hitler?
Brilliant, but only at a first glance.
A look at the map, and one will notice that Germany and Russia didn't have a common border. The Poles would have needed to grant permission for Stalin's "liberators" to pass through in case of war. But, the Poles had some strange notions that Stalin would have liked Poland so much, that he would also never want to leave.
So much for that idea....
What else?
Ignore the Poles, and just make a deal with Stalin anyway?
That would most likely have resulted in a German-Polish mutual assistance pact (or even a full Polish alliance in the Axis). First feelers were already in place.
http://www.polishforums.com/history/president-moscicki-hermann-ring-hunting-47942/
The dictators in Warsaw and Berlin, would certainly have found an easy solution for their differences, and Poland's dreams of "Greater Poland" of the 17th century could have been given some new impetus. Certainly, Hitler would have contributed his share towards making the Poles happy, and "signed away" Lithuania (seeing that the Poles already had the capital city under their control) without a shred of conscience.
An extra 2 million Polish troops firmly embedded in the Axis armies, and fighting side by side with Germans, Slovaks, Romanians and Hungarians. Plus a starting point a 100 miles closer to Moscow, might just have been what was needed to defeat the SU in 1941.
Maybe "a Chamberlain" in 1938 was not such a bad thing after all.
Give the guy a break....
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pebutts OK, I can see you know what you're talking about :-)
First off, there seems to be quite a few differences between the US and the different European tax models.
The reason I wrote '10%-ers' in quotation marks, is because it is impossible to make an exact figure. Like you said, the word ' wealth' is relative, and difficult to define exactly.
From what you write, I conclude that US and European tax models would also be difficult to compare. They probably have some similarities, and some differences. I can only speak of what I witnessed, doing the preparatory bookkeeping for the family I worked for for many years.
In the course of the years, I noticed that they had several advantages over mere 'wage slaves' like me. Just kidding, they were really nice, and their two employees earned more than in any similar jobs anywhere else.
The family had incomes from several sources, some inherited, and they constantly shifted funds around, exactly as you explained, on order to gain advantages of a lower tax rate for the current year.
The man had inherited some apartment blocks, the income of which he used for renovations, so that he basically drastically reduced the taxable income for the rent he received. If he needed money, he sold some flats, and (exactly like you said), if he got a bundle of money, he invested in a new project. In Germany, one only has to keep a house or apartment for ten years, then the resale is tax free. The man's 'salary' was not defined anywhere or even fixed, and he basically bought whatever he wanted from the difference between what he got for a flat ( tax free), and what he re-invested in a new project.
I once did a little calculation, and worked out that I probably paid a higher percentage of taxes on all my sources of income, plus the VAT on services and products I buy, than the family did.
Another example, of many I can mention, was when he bought himself a new yacht. Of course, this yacht was also a 'charter company', with all the accounting involved in that. He could basically enjoy his hobby of sailing ( he went more often than the 3 weeks that was stipulated), whenever he wished, and it was all tax deductible. Fuel, maintenance, berthing fees, etc. were all balanced against the income generated ( mostly friends, and friends of friends), so that at the end of the year the 'company' only made a small profit. He also had no incentive to increase the profit, and he also didn't like the idea of total strangers using 'his' boat.
In Europe companies also don't pay VAT, and can deduct this ( German name for this is 'Vorsteuerabzug'). I wouldn't know if there is something similar over in the USA.
Would I have similar advantages if I bought a yacht? This yacht would be private, and I'd have to pay everything out of my own pocket (including 19% VAT). Unless, of course I buy a boat and let total strangers charter it, with all the risks and disadvantages of that.
Another example is the family's four cars. None of which was registered in the names of the family members who drove them, but rather on the different companies. As for 'jobs' created, his wife had a so-called 'Midijob' of 850 Euros per month ( no income tax payable at all for salaries up to 850 Euros). Not much, but is was basically a tax saving scheme, since the wife did hardly anything at the small ' company' of which she was supposed to be manager. Guess who got to do all the work :-)
And note, this is merely a fraction of 'the stories I could tell'...
Setting it up this way, the man didn't have a taxable personal income, the wife earned a salary which was too little to be taxed, and they enjoyed the benefits ( computers, smartphones, cars, yachts, travel expenses, etc.) of companies which hardly made a profit.
I don't consider any of these companies the family owned or set up as valid (real world) companies, as is often suggested in the ' trickle down economy' model.
Most of these 'companies' did not rent office space, employ own staff, engaged in sales or production of any kind. They did not contribute to society in any way by supplying a valuable service or product (i.e., the ' charter company' I mentioned).
Of course I had a job ( also one other employee), but that's hardly worth the mention with total assets in excess of 20 million Euros.
They were solely started up for the sake of saving taxes in a way the average man on the street could neither image, nor imitate.
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pebutts Well, it looks as if both of our our former bosses have worked their way up.
My former boss became successful through a combination of killer instinct and just plain luck. When he was a young man in his twenties, he bet almost his entire inheritance on the hope that the ruined apartments and houses he bought in the former East Germany would increase in value over the years. And he was right.
By investing the income he had from the rents he collected, back into renovations of the new properties he had bought, he hardly paid taxes in the startup phase of his idea.
He worked extremely hard as a young man, so I think he deserved his wealth. He showed me pictures of himself when he started out refurbishing the worn out junk properties he had bought. He was too stingy to spend money on hotels, so in the evenings he'd camp out between machine tools and bags of cement.
Even the villa he lives in today was a bit of a ruin when he bought it, and he has been spending years making upgrades.
If you saw them today, you'd never guess where they were 25 years ago.
Of course, he took a risk with the 'easy' money he inherited.
Of course, if he didn't have an eye for the potential value the properties would have a decade or two later, he wouldn't be where he is today.
It's also not that he doesn't pay any tax at all. It's probably about the same as a family with a slightly less than average income. Most people would have little understanding for a tax system which allows such loopholes though, especially not young families who are struggling, and who realize they are taxed more than somebody with millions to his name.
The reason I posted my initial comment, was a notion I had that what he does on a relatively small scale, is also possible on a much larger scale, and people and companies who legally ' cheat' their governments out of millions, and hundreds of millions of escaped taxes by exploiting loopholes.
My former boss could certainly afford to pay ten or twenty thousand a year more, and thereby pay his just share. However, like you said, he doesn't have to, because the tax system provides these loopholes. So why should he?
I guess the reason most people don't approve of his behaviour, is because of a nagging feeling that 'somebody has to come up for the shortfall in taxes which are not paid by corporations and the rich folks, and that will be me'.
I'm all for a much simpler tax system, with more direct taxing like tolls, VAT or 'luxury' taxes on unhealthy or fast food.
There should be less loopholes and opportunities for tax returns. I don't think these create incentives for re-investment.
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pebutts IMO, most people operate according to the principle of NIMBY. Of course, everybody wishes to gain benefits from living within a society, but it's primarily others who have to bear the burden, or suffer disadvantages.
That principle is as true for having a new high-voltage power line cutting across one's own backyard, as it is for paying taxes. I entirely agree that spendthrift politicians should be limited, simply by limiting the funds available to them, or by simply fixing or pre- allocating funds in a user fee system.
Therefore, I entirely agree with your statement that the tax system should be radically simplified, and that there should be a higher user fee based economy.
What about the military, or the police?
Defence and the protection of the civilian population takes about a third of the US budget, so how would one finance that without the collection of taxes?
A user fee based system won't work.
Do you also advocate cutting the funding of the US military or the police forces, in order to place limitations on spendthrift politicians here?
How do you personally feel about the fact that there are families struggling to make ends meet, paying a higher rate of taxes (seen as a percentage of their individual income), than certain privileged individuals?
These disadvantaged families who pay a higher share (from the perspective of their own financial situation) because they don't have any loopholes which they can exploit, therefore pay a higher personal burden of national defense or public safety than others, who also benefit, and who HAVE the means, but also use ( or misuse) loopholes to shun their fair share ( seen from the perspective of the own financial situation).
Of course, it is all legal -- well, mostly :-)
But, you should also have a personal opinion whether it is also correct.
The concepts behind the words 'legal' and 'correct/fair' are entirely different.
As far as I'm concerned, the debate should be about whether the tax system is fair from an individual standpoint (from the bottom, looking up). It's not about anybody violating laws, which it obviously isn't.
It should also not be about whether the taxes collected are sufficient, since ( as you correctly pointing out) those politicians 'at the top' will never get enough. It is therefore also not a debate from the top, looking down.
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The USA has lived beyond its means for more than 50 years. Now it's all coming to a head.
After 1945 the US government and 1%-ters set out to gobble up as much of the world's resources for themselves if not direct control then indirectly via implementation of the dollar hegemony.
Money in the form of printed fiat currency (post-1913) of course, is a means to exercise CONTROL, and to funnel the resources of the world in ONE direction: upwards, towards the hegemon issuing the fiat currency as a means to steer the resources.
That is the reality on ALL tiers, even within the own borders, not only International Relations. Divide and rule implemented downwards, onto their own people, and outwards, onto the entire planet.
This is how limited factor (resources) can be CONTROLLED by printing a potentially unlimited factor (money), and affording this unlimited factor to FAVORITES (divide and rule).
Observation reveals that it is not "hard work" which determines how the resources are divided (WHO you are), but a pre-selected standing (WHAT you are). Americans, are slowly waking up to this reality, as we speak, because it is not 1950, or 1970, or 1990 anymore.
The USA came out "on top" after 1945 because of a GEOGRAPHICAL ADVANTAGE, not because of better leaders, a better government, or anything else.
A geographical advantage meant the ability to employ division as tool, more successfully than other systems: which is the employment of the divide an rule technique.
No, the US government was not "good," unlike its people, but rather used geographical advantages to be more slimy than everybody else. Sorry, if reality triggers anybody. Sorry, but at least 50-90% of Americans are NOT privileged enough to benefit from the "50%" of resources the empire vacuums up, claiming it as its justified "right" to CONTROL.
Whatever.
You'll soon find out.
Then, from the position of the "top of the hill" (shiny house) point at other systems, and via the use of false argumentation, claim that all other systems are bad/evil, want to rule the world or whatever: it doesn't really matter because the entire rotten own system is filled the brim with every imaginable ideologue, idealist, nutcase, cutthroat, and everything else. These will soon simmer and percolate to the top of the froth, as and the true reality of human nature will be revealed soon, when the entire card house of lies implodes, and the USA can no longer CONTROL "50%" of the world's resources.
footnote
In February 1948, George F. Kennan's Policy Planning Staff said: "We have about 50% of the world's wealth, but only 6.3% of the population*...Our real task in the coming period is to develop a pattern , of relationships that allow us to maintain this position of inequality."
And that's what these internationalist/globalist gentlemen did in the past, and still do today.
Use divide and rule on the planet.
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