Tag Archives: tax reform

Obama targets wealthy [again] for next budget deal

President Obama said on Sunday that the next budget deal could be centered on reforming the tax code – but only where it affects the top earners.

In a CBS News interview on Sunday, Obama said that he didn’t “think the issue right now is raising rates” agreeing with Republicans that have said that the time to raise tax rates is over. But the President continued his assault on the most-productive in American society by choosing to affect their deductions, and no others as he asked “Can we close some loopholes and deductions that folks who are well connected and have a lot of accountants and lawyers can take advantage of so they end up paying lower rates than a bus driver or a cop?”

About half of Americans currently pay no income tax and certainly don’t pay more than the highest taxed earners in the nation. Focusing on those who already handle the overwhelming burden of funding the United States’ Federal Government gives Obama a way to increase taxes on a portion of the population while allowing others to continue taking advantage of infrastructure and programs they don’t pay for.

A truly fair proposal might be to get rid of all credits or loopholes, regardless of tax bracket. If the tax system is currently overly-rewarding to the top earners, they would be taking a bigger hit in the reform that would level the tax code – but “fair” is not the goal of the administration or the Democrat party.

 

A Friend of the Tea Party. Really?

“…Americans for Tax Reform, its leader is Grover Norquist. The more popular name…is the Tea Party.”

Grover Norquist’s name surfaced recently in a publicized discussion about Islamic Jihadists that have taken root in America. No, he isn’t a Tea Party activist but apparently he’s identifying his 1985-founded ATR group with them and some Tea Parties are falling for it. The quote refers to the pair as a “Trojan Horse.” [Excerpted from The Washington Times, September 29, 2012]

I suggest Grover Norquist is the only Trojan Horse and if anyone’s been ‘Trojan Horsed’ it’s been the Tea Party.

Main stream media cites Norquist as “a conservative lobbyist and activist…responsible more than anyone else for rewriting the dogma of the Republican Party.” Norquist has attributed his successes to Ronald Reagan and whatever similarities Norquists sees there must’ve been left at that door a long time ago.

Norquist’s subsequent and by now renown “Wednesday meetings” at ATR are said to be the “Grand Central station of the conservative movement,” a “must-attend event” for Conservatives who receive an invitation. Operative words being ‘who receive an invitation.’ Reportedly some Tea Parties have and do. Norquist being the successful mind to which so many extend accolades, obviously his ‘invitations’ to the Tea Party are not by happenstance.

The discussion’s records are convincingly well-documented. Its practical facts drew a very scary picture of radical Islamists that few Americans have taken time to recognize; and, particularly, of Grover Norquist and his ATR. These conclusions are drawn from those records and my independent research of them.

Until the early 1990s Norquist seemed to be on the right track and that’s what pole-vaulted him into the powerful acclaims of Conservative standing that he enjoys today. In 1993 Norquist used those successes through ATR to launch “Wednesday meetings.” That’s about when Norquist appears to start wielding power in less than desirable directions.

Indications of Norquist’s fall from the graces of ideological good can be noted by his involvement in the Jack Abramoff Indian lobbying scandal. Today a number of Republican Congressmen, rightly so in my opinion, take other serious exceptions to the distasteful nature of Norquist’s political maneuverings.

Norquist’s Libertarian response to Republican concerns more closely mimicked Democrat demagoguing of self-interest than those of a respectable Conservative. Using the powerful influence and resources that, ironically, Conservatives bestowed on him, Norquist has threatened their Left media character-assassinations if he doesn’t get his way. Politics makes strange bedfellows.

In the 1990s Democrats and the Clinton-Gore administration saw the Muslim community as sources of funds and votes. They began an outreach program through which Islamic Jihadists saw easy entrée into various aspects of American government and, more importantly, into one political Party. What Jihadists probably didn’t expect was easy access to Conservatives through confidences that someone like Grover Norquist could afford them.

Relying on Norquist‘s Conservative clout the ATR “Wednesday meetings” became a means of introducing Conservatives and ‘trusted’ Islam Influence Operators to one another. Perhaps not surprisingly by 1998 Norquist had joined with Adbulrahman Alamoudi, an Islamic-adherent operative, to found the Islamic Institute (II) aka the Islamic Free Market Institute Foundation. In that same year Alamoudi was reported announcing:

“If we are outside this country, we can say, ‘Oh, Allah, destroy America.’”

Dare we ask, what were you thinking Grover? This appears symptomatic of Grover Norquist’s 1990’s about face.

Alamoudi was Clinton-Gore’s liaison, serving as their Goodwill Ambassador to the Muslim community. He’d also worked as an Advisor for the Clinton administration’s Middle East process and was subsequently delegated a variety of highly sensitive duties. One of those duties was placing Muslims – who‘d received little to no vetting – in positions within the U.S. military.

In 2000 Alamoudi spoke in Lafayette Square, Washington D.C., at an anti-Israel event sponsored by none other than Norquist’s ‘Islamic Institute’ front (among others) and announced amid cheers of the spirited crowd:

Hear that, Bill Clinton, we are ALL supporters of Hamas, Allahu Akbar! I wish they added that I am also a supporter of Hizballah.”

Maybe Grover Norquist and his co-founder Alamoudi support Hamas & Hizballah Jihadists, but I doubt Americans looking to ATR for tax relief do. I’m confident the Tea Party doesn’t. I know I don’t.

Alamoudi came to be imprisoned on terrorism charges, admitting he gave $1-million to the Muslim Brotherhood’s Al Qeada. Alamoudi is connected with and/or directly assisted in developing a variety of other Jihadist  Influence Operations in America, see ‘short list’ at the end of this article.

It’s a given and perhaps wrongly so that the American People understand just what a critically serious threat the Muslim Brotherhood is to America. Sometimes I wonder given the absence of outcries against Muslim Brotherhood’s highly irregular number of visits to our White House during this administration.

The Trojan Horse is unloading. This ‘unloading’ period does have an expiration date. What then, if we do not give this necessary attentions now?

Norquist’s cofounder buddy, Alamoudi, created a particularly effective Muslim Brotherhood organization in 1990: The American Muslim Council (AMC) headquartered in Chicago. All 911 terrorists were reported members of the AMC with one of its groups cited as “the violent Wahhabi branch of Islam.” AMC spins-off into a variety of affiliations as all Muslim organizations seem to do.

For every new Jihadist lead recruit they appear to create another organization to fund him; and the same for their lead recruits and so on. They’ve implanted Sharia-adherent law firms and bank and financing arms. The pot of money thus radical Sharia-adherent influence spawned by these groups keeps compounding itself and all of the money goes to the workings of more infiltrating Jihadists. One can only speculate how much money comes from one form or another of the billions of dollars in Taxpayer funded “foreign aid.”

Reportedly in 2001 Norquist’s Alamoudi co-founder participated with 400 other top Jihadists in an International Terrorists’ strategy session in Beruit. According to Fox News:

“This meeting brought together the world’s most extreme Islamic terrorist groups to set aside their differences and unite for Jihad and against Israel and the United States.”

This hasn’t scratched the surface of Norquist & Alamoudi’s radical Islam connections and handiwork. Any Conservative worth their salt is cautioned about connecting themselves – or their Tea Party – with Grover Norquist and his ATR.

The only way to kill a cancer is to starve it. Watch activities in your area and government’s foreign aid spending; contact your Congressmen with your voices; and be sure – wherever you’re donating – your money doesn’t go to the wrong place for what you only think are the right reasons.

This is a short list of Norquist’s associations through his Alamoudi co-founder. The last is Suhail Khan, a comprehensive background to be separtely addressed. Look them up and be willing to read past initial link displays of innocent nursery rhyme propaganda that this administration has spent the last four years rewriting. All of these are said to have direct affiliation with radical Islamic-adherent Jihadists aka the Muslim Brotherhood.

Abdulrahman Alamoudi

  • Grover Norquist’s Co-Founder of Islamic Institute (II)
  • Founded American Muslim Council (AMC).

Sami al-Arian

  • Member American Muslim Council (AMC).
  • Formed National Coalition to Protect Political Freedoms aka Defending Dissent Foundation
  • Board of Directors & Officer of Palestinian Islamic Jihad (PIJ)
  • Abolished ‘Secret Evidence’ that Government could use against Terrorists.
  • Connected to Jeff Abramoff & Jamal Al-Barzinji

Khaled Saffuri

  • Long time Palestinian friend & collaborator of Almoudi.
  • Executive Director & President of Almoudi’s Islamic Institute.
  • Founder & Executive Director of ‘Muslim Council’ front group.
  • American Task Force for Bosnia (top Jihadist recruiting vehicle)

Janus-Meritt Strategies

  • Grover Norquist Law Firm
  • Represented Alamoudi 2000-2001
  • Later declared it represented Jamal Al-Barzinji.

Jamal Al-Barzinki

  • President of Muslims Student Association
  • Founder of North America Islamic Trust (NAIT)
  • Past Leader of Islamic Society of North America
  • Vice President of International Institute of Islamic Thought
  • Major Contributor to Dar al-Hijraj Mosque in Virginia

Islamic Institute

  • American for Tax Reform (ATR), Grover Norquist
  • General Council for Islamic Banks & Financial Institutions

Alamoudi’s Military Endorsement Agent

  • Islamic Society of North America (ISNA)

Khaled Saffuri

  • First Executive Director of Islamic Institute (II)
  • President of Islamic Free Market Institute Foundation (FMIF)
  • Collaborated w/Almoudi on American Task Force for Bosnia

Islamic Free Market Institute Foundation

  • Held Series of Conferences beginning 2002
  • Institute Foundation International Islamic Finance Conference, Washington D.C.
  • General Council for Islamic Banks & Financial Institutions

Nihad Awad

  • Leader of Islamic Association for Palestine (IAP)
  • Executive Director of CAIR
  • Long Record of Service to Hamas
  • Muslim Community Leader under Saffuri/Alamoudi Team
  • Included on Muslim Brotherhood ‘Project’ Memorandum
  • Helped form Council on American Islamic Relations (CAIR)
  • FBI wiretapped for involvement with The Palestine Committee

The Palestine Committee

  • Established by International Muslim Brotherhood Resolution
  • Attributed to “The Islamic Resistance Movement” by Federal Court
  • Evidenced in The Holy Land Foundation Trial.

Holy Land Foundation Trial

  • Shut Down for Funding Hamas Terrorism
  • Prosecutors Named CAIR as an Unindicted Co-Conspirator
  • CAIR, ISNA & NAIT upheld in appeal as Hamas Affiliates

Muzammil Siddiqi

  • Radical Imam
  • President & Current Director of Islamic Society of North America
  • Chaired North America Islamic Trust
  • Executive Council of The Fiqh Council of North America, an
  • Affiliate of the ISNA
  • Selected to hols 911 Service in Washington D.C. on Septemebr 14th

Suhail Khan

  • Former Staffer for Rep. Tom Campbell of California
  • Most Accomplished of Muslim Brotherhood’s Current Young Recurits
  • Inside the Highest Reaches of Government
  • His Success is Attributed to 14-year Association with Grover Norquist
  • To Be Continued …

And the beat goes on … stay tuned.

For background information and revealing videos about this issue go to my last article: Know Your Enemy & You Probably Don’t.

Credit for making sense of and for the bulk of information in this article goes to Frank Gaffney & Center for Security Policy.

 

11 Deceptions About the Tax Debate

Below are the Whitehouse.gov’s “11 Facts About the Tax Debate.”  As usual, they are out of context, disproportioned, deceptive, and out right false briefing points.  Here are just a few reasons why they are nothing more than election year red herrings.  (A fitting expression for such socialist ideals.) WH.gov points are in italics.

1.     Nearly $1 Trillion would be added to our deficit over 10 years under the Republicans’ proposal to continue tax cuts exclusively to households making more than $250,000 a year and to the wealthiest estates.

Only 1 Trillion in 10 years?  That sure is a better than Obama’s plan strapping us with over 10 Trillion more debt in the past 4 years, and much more in the next 10.  Republican tax cuts to those who are producing jobs realistically stimulate the economy.  History tells us that lower tax rates produce greater employment thus greater tax revenue 100% of the time!  Are 100% to 0% not good enough odds?

2.     Only 2 percent of American households will benefit from the Republicans’ proposal to extend tax cuts for those with incomes higher than $250,00 a year.

Actually 100% of Americans will benefit.  Those 2% are the ones investing in America and want to do more so more people can be employed, pay taxes, spend and invest.  All studies of history and economic models show that the sweet spot is about 17% across the board.  I.e. a flat tax of 17% produces the maximum revenue by allowing maximum employment and investment.  Thus we’re killing our selves by trying to squeeze more money than we can afford, which kills our ability to earn more.

3.     Under President Obama’s proposal, only the wealthiest 3 in 1,000 estates would owe any estate tax.

So only the wealthiest 0.3% will pay estate taxes?  He’s bragging about this?  Notice he doesn’t compare it to a Republican plan; a sure sign they have a better idea.

4.     Over the past 4 years, a typical family making $50,000 a year has received tax cuts totaling $3,600 – more if they are putting a child through college.

The White House fails to mention that our average income decreased 3.02% from 2008 to 2010.  For a $50K household, a loss of 3.2% is $1,600.

Inflation due to the Fed creating money, “monetizing the debt,” “QE3,” “printing money,” “digitizing money,” you name it.  Inflation was 4.46% in 2011 alone.  That has lowered the value of $50K by $2,238.

Those two factors alone add up to $3,830.  So even if your “tax decrease” was real, your average $50K family lost $283 per year.  Does the WH call these bragging rights?

They also fail to mention that he’s just Nationalized ALL student loans, (so he can forgive a great proportion of them).  That will cost “average” taxpayers more money.  So there are several ways we all pay for other people’s children to go to school.  Obama said, “those making under $250,000 won’t see a tax increase.”  Yup, they just won’t see it.

5.     5 million families would no longer be eligible for the child tax credit under the Republicans’ tax proposal.

Truth be known, both parties support a modification to the Child Tax Credit.  It is due to expire, so the debate is only which plan to adopt.

Additionally, the Treasury Department reports that illegal immigrants filing tax returns using the Individual Tax Identification Number are receiving more than $1.5 billion each year from the federal government through the Child Tax Credit and the Additional Child Tax Credit.  Need a fix?

6.     Because Republican proposals cut the Earned Income Tax Credit, nearly 6 million working families with children would see their taxes increase – averaging $500 apiece.

The WH has cherry picked only the most conservative of many Republican plans.  Many, if not most, do not affect this Credit.  In support of those that do, this Credit pays able people for not working.  We have enough of that.  What is not mentioned is that this proposal also abolishes tax code exemptions and credits for the rich and big business.  Everyone who is able needs to pay something.  It keeps us all responsibly involved in government.

7.     The President’s plan includes almost $700 billion in tax credits to help middle class families pay for health insurance over the next 10 years through the Affordable Care Act.

Somehow we’re to believe we aren’t going to pay the $700 billion.  That $700,000,000,000 comes from taxes.  How many will loose jobs because companies are forced to cut employment or go bankrupt because they have to pay fines, (oops “taxes,” oh no “fees,” wait “taxes,” whatever)?  They’ll have to pay much more just to employ people.  That isn’t going to help employment or the tax base.

Thus Obama Care will increase the number of folks relying on taxes to support them and pay for their healthcare, thus driving that 700 billion estimate off the scale.  This is a “Cloward and Piven” plan, plain and simple.  “Overload the economic system through escalating the need for entitlements by the increased tax load to fund them.  Mr. Obama once taught the Cloward and Piven’s strategy to collapse capitalism.  Now he’s implementing it.

It has become common to name a Law the opposite of its worst feature to mask its true identity, i.e. ”The Federal Reserve” which is private and has no reserves.  Would you vote for the “Unaffordable but Compassionate Care Act”?

8.     The top 2 percent of households, with and average of $800,000, would see additional tax cuts under the Republican plan.

… as would most income brackets.  These wealthy people are already in the highest tax bracket.  This misleading information only mentions the cuts and not the main part of the plan that drastically removes tax exemptions in the first place.  Most Republican restructuring is designed not only to simplify taxes and reduce exemptions, but also to incite job creators.  Read the bills!

9.     Under the President’s plan, income tax rates for high income households would return to the same tax rates as in the ‘90s.  During that period, the United States created 23 million jobs and ran a budget surplus.

Remember the 17% rule?  Higher tax rates actually produce less revenue than lower rates above 17%.  When Bush lowered the tax rate in 2003, the tax revenue actually increased due to greater employment and higher wages.  Even Obama agreed to extend them for that reason.

It isn’t trickle down, it is flow down, and the government needs to be at the bottom of the flow, not the top.  Under the Republican plan everyone’s effective tax rate would be reduced, causing greater employment thus more tax revenue.  Businesses would be incented to locate and operate here in the US rather than overseas.

The government doesn’t create jobs, the people do.  Even government jobs are created out of the people’s tax dollars.  The government doesn’t build anything; we do, to include the government.  When the government uses our money to build inefficient, ineffective, failing, or just plain fraudulent institutions, we pay the price.

For example, the 90s is when the Liberals were most influential at inflating the housing bubble by incentives to lend to those who couldn’t afford those loans and eventually penalizing lenders that did not.  That escalated inflated prices that eventually had to burst.

10.     The President’s plan would continue the 10 percent tax bracket, which allows everyone to pay a 10 percent tax rate on their first $8,900 in income (or $17,800 for married couples).

Notice there is no mention of a Republican plan here, because under the Republican plan, middle-income families of four pay no taxes on the first $39,000 of its income.

So the President is bragging about doing nothing?  I have to admit, doing nothing has been one of his least problematic qualities.

11.     The Republicans plan eliminates the American Opportunity Tax Credit, meaning 11 million families and students paying for college would see an average tax increase of $1,000 each.

Actually there is no tax increase involved.  It means that the $1,000 credit for having a child in college expires December 31st 2012.  Both parties have competing plans for an amended version.  Reality always sounds a little different than WH talking points.

So shall we talk about unemployment?  How about why businesses move jobs overseas?  How about Agenda 21, (disguised as “Sustainable Development)?  Can we discuss how many more doctors will be created under Obama care?  How about illegal aliens; Homeland Security that considers “we the people” a greater threat than rife illegal boarder crossings?  Let’s discuss why the US prosecutes innocent supporters of the GOP (i.e. Gibson guitar), while allowing anything black, or Muslim, or alien, or Occupy movements go unprosecuted, (per stated administration policy).  How ‘bout that Medicare?  Social Security?  Where do those fit in your list to debate?

Barack Obama was right about “Hope & Change.”  Never has America hoped for change more than now.

God bless America.

Rejecting FairTax Part Three: The Flat Income Tax

In Part One, I’ll cover the dangers of taxing consumption as a major source of government revenue, both to the individual and to the economy.

Part Two will cover the little-known problems in the FairTax proposal- the “fine print” FairTax advocates won’t tell you about (or don’t know themselves); I’ll also refute some of the inconsistencies and rhetoric used by FairTax advocates.

Part Three will introduce the reader to the benefits of flat income taxation- why it’s superior to consumption tax, and the economic benefits of flattening the tax code.

Part Four will introduce the reader to the Negative Income Tax Credit- an ideal solution to the the problems of our massive welfare state, which can only be implemented in conjunction with an income tax system.

Part Three: The Flat Income Tax

I can’t think of a better introduction to the Flat Tax than the one given by Steve Forbes:

The flat tax would be simple. You could fill it out on a postcard. It would be honest. It would eliminate the principal source of political corruption in Washington. It would be fair. There would be no tax on Social Security. No tax on pensions. No tax on personal savings. It would zero out capital gains taxes. It would set off a boom by letting people keep more of what they earn and by lowering barriers to risk taking.

For a more-complete introduction, I highly recommend “The Flat Tax” (which can be bought in e-book format from that link for $6.72), written by the originators of the modern flat income tax concept, Robert Hall and Alvin Rabushka.

Let’s tick through each of Steve’s points:

The flat tax would be simple. One thing which is not generally understood about our tax code: The majority of its 70,000+ pages are devoted to defining what “income” is, and in what manner said income is taxed. This is also the source of many “loopholes” in the tax code. Treating all income identically for tax purposes would eliminate the bulk of the tax code, making it simple enough that a tax return would be the size of a postcard.

It would eliminate the principal source of political corruption in Washington. Indeed, Forbes is right- the principal source of corruption in Washington is from tax lobbyists. It is they who are responsible for the extent of our tax code, and the special “carve-outs” given to selected businesses and industries. The ability to undo decades of their influence with a single pen stroke- to make the tax code both honest and fair- is highly attractive.

There would be no tax on Social Security. No tax on pensions. This is a major selling point for the flat income tax over consumption taxes. As I illustrated in Part One, a national consumption tax would eliminate the tax privilege for retirees’ Social Security and/or personal retirement savings. Flat income tax would retain this tax-privileged status.

No tax on personal savings. It would zero out capital gains taxes. One of the few substantive selling points of FairTax is the fact that a consumption tax wouldn’t tax investment and savings. However, this effect can be duplicated in a flat income tax by simply eliminating the capital gains tax and granting a deduction for personal savings, without exposing taxpayers to the negative consequences of a consumption tax. In the link above, Forbes mentions “pushing millions of people out of the tax system”- this is a reference to the elimination of capital gains tax.

It would set off a boom by letting people keep more of what they earn and by lowering barriers to risk taking. As I illustrated in Part One, consumption taxes are regressive- they keep poor people poor. Consumption taxes also favor already-established large businesses over new, small businesses. A flat income tax, on the other hand, is non-regressive and non-favoritist. It promotes economic competition rather than stifling it. All business pay the same rate on their profits, and all individuals pay the same rate on their incomes.

I’ll add another point: It would eliminate the corporate income tax. Corporate income tax, like capital gains tax, is a “double-tax”: Corporations are bodies of people (shareholders), and the profits after business expenses belong to them. This means the same money is taxed twice– once under corporate income tax, and then again under personal income tax (when they sell their shares) or capital gains tax (when their shares grow in value). In fact, in most cases it’s a “triple-tax”, since the shares were initially purchased with money on which personal income tax had already been paid. This tax is also crippling: our corporate rate is the second-highest in the world (35%), yet it only accounts for 9% of total federal revenues.

As for eliminating deductions: While most deductions can be safely eliminated without great controversy, there is one which must be specifically addressed: Charitable contributions.

Naturally, the public at large believe that this deduction promotes altruistic contributions from “the wealthy” to legitimate charities. In fact, the reality of this deduction is somewhat different: Much of the money claimed in this deduction is donated to non-charitable organizations (political and quasi-political organizations, for example). Indeed, Robert Hall and Alvin Rabushka point out the following in their book (above):

There is little merit in public subsidy for organizations whose success in raising funds depends on tax deductibility rather than the intrinsic merits of their activities.

While it would be preferable to eliminate it entirely, for the reasons stated above, an acceptable compromise would to do what Hong Kong has done: Cap charitable contributions at a percentage of a person’s taxable income.

On the other hand, a deduction which must be preserved is the deduction for business expenses– a very necessary deduction, since (as stated previously) taxing business expenses would create a barrier to entering self-employment, and would disproportionally burden small businesses in comparison to large businesses. Note that there are differing opinions on this deduction amongst flat tax advocates.

One more benefit of flat income tax over FairTax: Predictability. We have had, in this country, a federal income tax for nearly a century. Our economy, and individual taxpayers, are already accustomed to income taxation. Business tax compliance measures, individual and group retirement investments, financial planning services, and many aspects of long-term business decision-making (just to name a few things) are already oriented toward income taxation, and are ready to acclimate to flattening the tax code. Eliminating the income tax in favor of a brand new- and totally unproven– consumption tax system would generate a minefield of unforseeable and unintended consequences (in addition to the known consequences covered in Parts One and Two).

In sum: In comparison to consumptions taxes, flat income tax is simpler, fairer, more transparent, and decidedly less risky. Flat income tax is also a tried-and-true system: Unlike major consumption taxes, which have been a failure in countries which have adopted them, flat income tax has been a rousing success in those countries which have instituted it.