Friday, May 1, 2009

Turn On Limbaugh, Tune In O'Reilly, Drop Out

One of the benefits of having an mail account is that it throws so much junk news at me -- basically trying to ascend to the level of People, but not trying very hard. It keeps me in touch with the corporate-media agenda at its cheesiest and often at its creepiest, and it's a reminder of what a good many Americans evidently consider news. (If they didn't, they'd look to other sources.) When one of my coworkers complains that Obama's just too liberal for her, I remind myself of the kinds of places where she probably gets her information.

For example, today AOL reports that Time magazine "asked readers to vote online for the most influential person, and the winner was "moot" -- aka Christopher Poole. He's the founder of, an image-based bulletin board that averages 13 million page views a day and 5.6 million visitors a month. 4chan has spawned other wildly popular sites, such as Lolcats. ..." said its technical team did thwart several attempts to hack the vote, but the results are still likely to raise eyebrows.

"I would remind anyone who doubts the results that this is an Internet poll," said managing editor Josh Tyrangiel. "Doubting the results is kind of the point."
So why bother? But I digress.

Anyway, yesterday, I logged out of my e-mail account and noticed this link, with the come-hither headline "Lots of Tax Hikes Coming in 2011." That looked like something that the Republican noise machine wants to hear, so I took a look. Though it appeared on the Wallet Pop page, the real source was, a home finance magazine's online avatar. The teaser read, "Tax increases will hit businesses and individuals, and don't think for a minute that only the wealthy will feel the pain."

I clicked through.
Think Taxes Are Too High Now?
Actually, no. Like most Americans, my taxes just went down, and they weren't too high before.
Just wait: Congress is all but certain to raise them a couple of years from now. Tax increases will hit both businesses and individuals -- and not just singles making more than $200,000 a year and married couples over $250,000 a year. They'll be the first to get pinched, but not the last. There's just not enough revenue that can be drawn from the wealthy without crippling the economy, so in time, middle incomers will feel a bigger bite, too.
"All but certain" -- that tiny qualification gave me the first hint that something was up. I started clicking through the gallery, with captions, depicting glossy, mostly white model-types looking pained at the pinch they would soon be feeling. The first, of a young woman palely loitering over her tax returns:
Boosts in top marginal rates from 33% and 35% to 36% and 39.6%. No change in the other marginal rates seems likely.
"Top marginal rates," of course, refers to the rates paid in the uppermost income brackets. And I thought that 39.6% was the rate that those people were going to start paying now. Since top marginal rates were around 90% for most of the twentieth century, and were above 40% for most of the Reagan administration, this does not describe a firestorm of taxation. Next slide, please!
A higher rate on capital gains and dividends, but only for those in the top brackets. They will probably be hit with a 20% rate, though it could go a little higher.
Capital gains tax, according to Wikipedia, is "a tax charged on capital gains, the profit realized on the sale of a non-inventory asset that was purchased at a lower price. The most common capital gains are realized from the sale of stocks, bonds, precious metals and property." Or, as the IRS puts it more tersely, "When you sell a capital asset, the difference between the amount you sell it for and your basis, which is usually what you paid for it, is a capital gain or a capital loss." Again, only "those in the top brackets" will be affected, and given the plunging value of so many capital assets thanks to the recent unpleasantness on Wall Street, they may have lower capital gains, or even some capital losses, to report.

And so it went: "Caps on itemized deductions for top earners", etc. Not one of the "all but certain" changes looked relevant to the 99% of us who earn less than $250,000 a year. The gallery invited the reader to click through the original article, which had more of the same, concluding that "anyone making more than $100,000 a year will be at risk for higher taxes." At risk! That's not even "all but certain."

I had heard of Kiplinger before, but not being big on finance and investing I didn't know what their track record was for predictions like these -- did they see the collapse of the US financial system coming, for one? So today I trekked over to the library and looked through several issues of the print magazine from the past year.

From the June 2008 issue, page 29, the lead article by Senior Associate Editor Andrew Tanzer crowed: "The Worst Is Over. Yes, we're in a recession, but savvy investors are finding a lot of attractive stocks." On the next page: "Although we're not predicting a rip-roaring bull market this year, stocks could still end the year in the black, just as we forecast in January." Oops. Darn. Did we really say that?

January 2009, page 27. Tanzer wrote: "Outlook 2009. After a rocky start, stocks will finish this year in the black as investors anticipate a better economy." Why yes, I would listen to economic and political forecasts by these people!

In the same issue, page 8, editor Fred W. Frailey laments: "The real tragedy of the market meltdown we went through in 2008 has scarcely been addressed. ... My father's generation viewed investing as speculation. I'm afraid that same state of mind is back." With people like Fred to man the barricades, that state of mind won't win out easily. But what I see, except in the financial pages, is the view that speculation is speculation. The trouble is that people like Fred think that speculation is investment; which it isn't.

While I'm on the subject, here are a couple of hot links from the current main page at "KID TIPS: Best Money Sites For Your Kids" and "WE RECOMMEND: Mexico Is Still a Leading Outsourcing Center."

But oh, the comments! Like this one, to the Kiplinger article:
POSTED BY: ROBERT REINERT, CPA (May 01, 2009 10:09 AM)
How do we start a revelution against congress without violence? Can we stop them from messing with S corporations? I have a practive the specializes in small business start-ups and we cater to S corporations if the SECA taxes change for S corporations these business will have to close. This is truely a path to socialization for the US. If we continue down this path there will bound to be a violent revolution. We have to make government more effiicient and reduce the government work force so the rest of us can bretah. Tell if you can what you reccomend I do first to stop this attach on small business ?
Mr. Reinert, CPA, spels reel gud too. I'm grateful to him for posting this, so that if I ever need a CPA, I can avoid him. Or this one:
POSTED BY: john galt (April 28, 2009 07:34 AM)
Certainly, this article will receive criticism from people who fall in the group of the more than 50% of tax filers who currently pay ZERO income tax... tax the productive! sure, they'll keep tolerating it.
Or this one:
POSTED BY: greenhornet (April 30, 2009 07:48 PM)
Did anyone really believe BHO when he announced during his campaign, "95% of you will get a tax cut."? His "training" under Rev. Jeremiah Wright and Bill Ayers focused on how to destroy this country and our system of capitalism and usher in Marxist socialism. BHO is a socialist who is hell-bent on destroying this country! Who determined which companies to bail out and which to ignore? And, why? Why didn't we let the free market decide which companies survived or not? As to taxes, more than 50% of Americans pay no income taxes at all! It would amaze you, I'm sure, to learn that not quite 10% of tax payers pay close to 70% of the taxes. I'd say the rich pay more than their "fair share" (whatever "fair share" is supposed to mean!). If everyone making over $200K per year paid 100% of the amount over $200K, there still would not be enough money to balance the budget. The liberals are good at starting "class env"y. The rich did not make their money on the backs of the poor or middle-class. They made their money by working hard, by investing in businesses, or real estate. In a capitalist society, everyone has the opportunity to become rich. You are limited only by your abilities and your drive! Not so, in a socialistic or communist economy!

To be fair, though, quite a few commenters noticed what I did: that the article contained no substantiation for its claim of tax hikes for people who earn even $100,000 year. That was reassuring, otherwise I might have feared I'd missed something. Comments (639 as I write this) at the Wallet Pop page have a higher hysteria quotient:

MissinNAction44 08:58:28 AM May 01 2009

How anyone could vote for someone with such a small amount of experience to run our country just shows how ignorant the American people really are. Had it not of been for John Kerry, getting him to speak at the democratic convention when he was running for President, noone would of never heard of Barack Obama. Yes he's great at giving a speech, but to run the country, i just don't see it. However, i did'nt understand how a drunk wound up in the White House either. It just goes to show you that the american people are a naive bunch. Let's see if everyone is jumping up and down shouting Obama, in four years. Yes he wants peace with Islam, and wants them to prosper. After all he's one of them. MissinNAction44

Kevfie 08:18:35 AM May 01 2009

It has nothing to do with right wing, or left wing..Kidcat24..It has to do with right and wrong! I was not a Bush supporter! Right now in this day and age the people of this nation are getting away from our values. We throw God out of the picture in order to proceed with things like gay marrige. Freedom of speech is, and has been surpressed in the sense that if you say anything you are persecuted for it. Our kids are being brain washed in public schools. I can go on, and on. Again, I am not a consevative. I am also not a liberal. Both parties are so screwed up. But right now the left is in control. I will speak out against what i see as a bad thing for this country no matter who is in office!

What does gay marriage (which, remember, Obama opposes) have to do with a small increase in the marginal tax rate for the top 1% of the American population? I have no idea. Neither, I suspect, does Kevfie.

Do I want America to turn into Sweden? (Sorry, I couldn't get the embed to work.) Not really. Those blond Nordic types have never done anything for me. I could endure 10 weeks of paid vacation, though. But don't be fooled -- look at Ingmar Bergman's films of godforsaken angst for a look at the real Sweden.