Tag Archives: Tax Scam

Not One More Word About the GOP Is Good For Business

No, I don’t want to hear one more word about how Republicans are “good for business.”  Not after this week.  First, we got that Tax Scam, the benefits of which went to corporations and the top 1% of income earners.  That is only superficially good for business — it did precious little for consumers, the ones who actually make the US economy run.  Corporations (we learned in high school General Business classes) make a profit when people buy their products or use their services.  The Tax Scam benefited the Investors, not necessarily the “business” in totality.   A system in which we continually cut corporate taxes in order to protect corporate revenue/profits and put the burden on consumers is a recipe for disaster.

Then the occupant of the Oval Office throws a tantrum and announced he is about to put 25% tariffs on imported steel and 10% on aluminum.  If this is about a trade war with China, he’s got it exactly backwards — we get more aluminum from China than we do steel.  And, now he’s finding out his steely blast will hurt Canada, “The top supplier to the U.S. in 2017 was Canada, followed by Brazil, South Korea, Mexico and Russia. Other notables include Turkey, Japan and Taiwan.” [MrktWtch]   The reaction to the announcement is/was predictable:

“Trump has declared that the U.S. will impose steep tariffs on steel and aluminum imports, escalating tensions with China and other trading partners and raising the prospect of higher prices for American consumers and companies. With tensions rising over international trade, stocks closed sharply lower on Wall Street. China on Friday expressed “grave concern.” [WAPT]

While the tariffs may have an effect on aluminum importation, the damage will be downstream:

“But industries that use aluminum say there’s an ugly trade-off: Manufacturing jobs in the auto and aerospace industries might go away if the cost of aluminum rises too much. The aluminum smelting jobs that Trump wants to save account for 3 percent of the total aluminum industry jobs in the United States, according to the Aluminum Association. The other 97 percent of jobs (about 156,000) are in downstream industries that take the raw metal and make something new with it.” [WaPo]

When former President George W. Bush slapped tariffs on foreign steel (2002) we lost approximately 200,000 jobs.

“A study funded by steel producers that supported the tariffs found that the tariffs brought back 16,000 steel jobs. A study funded by steel-consuming companies that opposed the tariff found that rising prices caused 200,000 job losses, concentrated in the metal manufacturing, machinery and transportation equipment sectors, though it noted that it was not clear how much of the price increases were caused by he tariffs.” [Star.com]

The job loss numbers are disputed, ranging from about 43,000 to 200,000, but no one appears to be arguing there won’t be some downstream (and midstream) damage from the imposition of tariffs.  Nor are major economic voices saying the Bush tariffs did all that much good.  The Bush tariffs were removed after 21 months.  And then there’s that “it’ll be easy” part.

Trade wars aren’t good for anyone.  One pithy summary asserts prices will go up, American businesses will lose sales, and American trading partners are also among our biggest lenders [CNN] and thus may be less willing to purchase our bonds — remember that budget busting tax scam passed by the GOP controlled Congress and signed by an enthusiastic executive?  Lovely, now that we’re racking up a mountain of indebtedness as a result of the Tax Scam, we’re ticking off our biggest lenders?  In what world does this make any sense?

So, we have a Tax Scam that benefits a small investor class and backhands 99% of American income earners, a tariff plan that could easily cost more jobs than it saves.  It’ll be jeans, bourbon, and motorcycles … more a signal to Congressional and Republican leadership I’d think… but I’ll cling to my opinion that the real damage will be to American agriculture.

“The tariffs announced by the administration will put the interests of other domestic industries over farmers,” American Soybean Association President John Heisdorffer, an Iowa soy grower, said in a news release.  “Prior to today’s (March 1) announcement, China has indicated that it may retaliate against U.S. soybean imports, which would be devastating to U.S. soy growers. Our competitors in Brazil and Argentina are all too happy to pick up supplying the Chinese market.” [Fence Post]

But wait, we’re not finished.  There’s S. 2155 coming up in the US Senate — a bill to roll back some of the reforms included in the Dodd Frank Act, enacted in the wake of the Housing Bubble Debacle.  That’s right — the current mis-administration wants to reopen the Wall Street Casino and let the “investors” play the banking games which caused the last economic collapse.

Considering these three examples of incompetency and ineptitude, please — oh please — spare me any more renditions of “Republicans are Good for Business.”

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To Do List In Preparation For A Post GOP Tax Plan Life

I’d write a longer post today, but I feel the need to get started on my Post GOP Tax Plan financial life.  First, I need to get cracking on the purchase of my private jet.  I’ve been thinking of a Gulfstream G650,  but I may have to settle for a Dassault Falcon 900.  Either way I am assured that I can deduct the expenses involved in this purchase.  So, some public school teachers have to dig into their pockets for paper, and other school supplies, for someone else’s children? So. What.  If those needy-greedies will just have some patience I might get around to hiring someone who lives in their district who might pay property taxes.  But, maybe not.

Speaking of education,  I should get on the horn and let younger relatives who are in graduate school know that the tax plan benefiting the Rich will mean that they will be liable for taxes on their tuition waivers — that they’re actually earning some sub-minimal pittance for slaving away on research which will never bear their names is of no consequence.  Well, at least they can file their returns on one sheet of paper.

Meanwhile, I ought to look into getting my offspring into some pricier private schools. Why? Because I can deduct the costs of their pricey-private-tuition while those silly grad students, especially the ones in STEM subjects, will be paying on their tuition waivers and  won’t be able to deduct the interest on their student loans. They could be looking at 400% increases in their taxes. Bad for them. So nice for me!

This means I will be able to focus on the important things in my life, like managing my tax deductible golf courses.  After all, golf is relaxing, relaxed people are more productive, and more productive people earn more. Therefore, they are of greater good to society.  Greater, that is, in comparison to those little drones who manicure the greens and keep the landscaping trimmed.

And, what a lovely gift to the Middle Class that they will not have to deduct the interest on their home mortgages on properties costing more than $500K.  They shouldn’t be shopping in those districts anyway.  So, housing prices are a little creepy in some areas? Pretty high in some parts of the country?  Just stay away from high market homes in areas with high paying jobs! Problem solved.

Okay, there might be some security issues — like disallowing deductions for state and local property taxes means that police, fire, and emergency services will get pinched. But, this is a small price to pay for Freedom from Big Government. Or little government. Or, any government.   There could be some quality of life issues too.  Eliminating deductions for SALT could mean further pressure on budgets for public hospitals, schools, parks, and libraries.  Oh well, nothing the Gotrocks Family has to deal with.

The bills could, however hurt my accountant — if the inheritance tax is eliminated and the AMT is gone, then I don’t have to worry about creating elaborate tax dodging schemes to prevent paying “more than I should,” meaning — more than I want to.  However, this doesn’t necessarily mean my accountant should be all that worried. After all, I can still ask him to find ways to further protect my gains — like turning the Gotrocks Family into the Gotrocks Family LLC so we get the benefits of the Pass Through Loophole.

The House version of the Great Tax Shift (Did I mean to type “Shaft?”) eliminates deductions for major medical expenses.  Perhaps my accountant’s employees should hope for the Senate version, in case I give them heart attacks with my continual demands that they find more ways to hide more of my money.  Only old people have big medical expenses anyway.  Ah, the good old days when Grandpa died in his bed at home, surrounded by family.  Why should he go to a hospital for palliative care when it would be cheaper to pass away on the sofa?  The House version also eliminates the deduction for alimony payments — now, this could be an issue!

Too much alimony and I might have to head to a foreign country?  No problem.  The tax plan could help.  Remember that major short term tax breaks go to corporations.  Foreign investors own about 35% of all shares, thus when the short term benefits of the tax plan go to shareholders — Shazaam! — of the $200 billion in savings expected by the corporations 35% will go to foreign investors.  That could be something like $70 billion?

So, as I gaze upon the picture of the Secretary of the Treasury and his bride proudly displaying a whole sheet of wonderful Money, I remember that the Tax Plan is meant for the Gotrocks (LLC) — who benefit from university research but don’t want to pay for it, who benefit from local police, fire, and emergency services, but don’t want to pay for it, who benefit from schools, parks, and libraries, but don’t want to pay for them.

Happy the Gotrocks will be when there is no AMT to insure we pay at least Something. When there is no inheritance tax!  When those Little People Out There In The Dark will be paying to support the services I enjoy!  On behalf of the Gotrocks Family LLC: God Bless America!

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Filed under Economy, Politics, Taxation