Economic Turn To The Left - The Cure?

More Obama analysis from a brilliant mind and strategist plus a little humor - may be the last laugh for quite a while. (See 1, 1a, 1b and 1c below.)

Shift towards left for Israeli Capitalism? Ne'eman says the next Israeli government must re-balance and he cites statistics that show the pendulum has swung too far. I cannot disagree with Ne'eman but I do believe he excludes the enormous cost this tiny country must shoulder regarding security and the fact that Israel has always treated Arab Israelis less than fair and they are part of the statistics. Ne'eman also does not discuss the enormous burden and cost of moving large members of its society out of their homes and into new living areas and the cost of that infrastructure development etc.

Just as Israel must balance equities they must also balance their economic policies and not kill the goose that laid the golden egg. Capitalism has proven it can produce amazing wealth and it is for the government to properly channel this wealth without killing initiative and/or stifling creativity. Capitalism, in and of itself, is not bad, wine is not bad, cars are not bad etc.. Man's use of them can make them dangerous. Everything in moderation.

The U.S., now that its government is controlled by Democrats, is well on its way to doing most everything that is wrong in terms of what has driven and should continue to drive our economic engine . (See previous memo "Throwing Capitalism out With The Bath Water and See 2 below.)

Response from a close relative and fellow memo reader regarding the campaign, thoughts on education and my own response to her proposals regarding education and its funding. (See 3 and 3a below.)

A CPA and his firm look at consequences of both candidates tax proposals. (See 4 below.)

Syria moves forces in response to GW's recent attack. (See 5 below.)

Has playing the PC Race card begun to turn off voters and boomerang? Sheppard suggests it may have. (See 6 below.)

Obama's talk about de-regulation makes for nice fluff but it fades under analysis. His campaign rhetoric was always designed to raise crowd blood temperature but it never really enlightened anyone to the real facts because it was always just that - empty blather from an empty suit who is caught up in his ability to charm and excite with chosen words of change, hope etc..

On the other hand McCain did an equally poor job of responding and his own choice words of I will fight for you served on a "my friends" platter fell on deaf ears. The poor economy has overwhelmed anyone's sound judgment and, as I have so written, we might be willing to kill the goose that made us a powerful and great nation because we are now paying for our own cupidity, excess, and corrupt political system of oversight etc.

There is always a price to pay for going beyond rational limits!(See 7 below.)

Dick


1)Jack Wheeler is a brilliant man who was the author of Reagan's strategy to break the back of the Soviet Union with the star wars race and expose their inner weakness. For years he wrote a weekly intelligence update that was extremely interesting and well structured and informative. He consults(ed) with several mega corporations on global trends and the future, etc. He is in semi-retirement now. He is a true patriot with a no-nonsense approach to everything. He is also a somewhat well-known mountain climber and adventurer.


Written by Dr. Jack Wheeler

The O-man, Barack Hussein Obama, is an eloquently tailored empty suit. No resume, no accomplishments, no experience, no original ideas, no understanding of how the economy works, no understanding of how the world works, no balls, nothing but abstract, empty rhetoric devoid of real substance.

He has no real identity. He is half-white, which he rejects. The rest of him is mostly Arab, which he hides but is disclosed by his non-African Arabic surname and his Arabic first and middle names as a way to triply proclaim his Arabic parentage to people in Kenya . Only a small part of him is African Black from his Luo grandmother, which he pretends he is exclusively.

What he isn't, not a genetic drop of, is 'African-American,' the descendant of enslaved Africans brought to America chained in slave ships. He hasn't a single ancestor who was a slave. Instead, his Arab ancestors were slave owners. Slave-trading was the main Arab business in East Africa for centuries until the British ended it.

Let that sink in: Obama is not the descendant of slaves, he is the descendant of slave owners. Thus he makes the perfect Liberal Messiah.

It's something Hillary doesn't understand - how some complete neophyte came out of the blue and stole the Dem nomination from her. Obamamania is beyond politics and reason. It is a true religious cult, whose adherents reject Christianity yet still believe in Original Sin, transferring it from the evil of being human to the evil of being white.

Thus Obama has become the white liberals' Christ, offering absolution from the Sin of Being White. There is no reason or logic behind it, no faults or flaws of his can diminish it, no arguments Hillary could make of any kind can be effective against it. The absurdity of Hypocrisy Clothed In Human Flesh being their Savior is all the more cause for liberals to worship him: Credo quia absurdum, I believe it because it is absurd.

Thank heavens that the voting majority of Americans remain Christian and are in no desperate need of a phony savior.

His candidacy is ridiculous and should not be taken seriously by any thinking American. Pass this on to every thinking American you know!

1a) Notice to All Employees

As of November 5, 2008, when Obama is officially elected into office, our company will instill a few new policies which are in keeping with his new, inspiring issues of change and fairness:

1. All salespeople will be pooling their sales commissions into a common pool that will be divided equally between all of you. This will serve to give those of you who are under-achieving a “fair shake.”

2. All hourly employees will be pooling their wages, including overtime, into a common pool, dividing it equally amongst yourselves. This will help those who are “too busy for overtime” to reap the rewards from those who have more spare time and can work extra hours.

3. All top management will now be referred to as “the government. We will not participate in this “pooling” experience because the law doesn't apply to us.

4. The “government” will give eloquent speeches to all employees every week, encouraging its workers to continue to work hard “for the good of all.”

5. The employees will be thrilled with these new policies because it's “good to spread the wealth.” Those of you who have underachieved will finally get an opportunity; those of you who have worked hard and had success will feel more “patriotic.”

6. The last few people who were hired should clean out their desks. Don't feel bad though, because President Obama will give you free healthcare, free handouts, free oil for heating your home, free food stamps, and he'll let you stay in your home for as long as you want even if you can't pay your mortgage. If you appeal directly to our democratic congress, you might even get a free flat screen TV and a coupon for free haircuts (shouldn't all Americans be entitled to nice looking hair?) !!!
If for any reason you are not happy with the new policies, you may want to rethink your vote on November 4th.

1b) Unread Message DREAMS OF MY FATHER vs. FAITH OF MY FATHERS


FIRST BOOK OF DEMOCRAT

OBAMA IS MY SHEPHERD,

I SHALL NOT WANT.

HE LEADETH ME BESIDE STILL FACTORIES.

HE RESTORETH MY FAITH IN THE REPUBLICAN PARTY.

HE GUIDETH ME IN THE PATH OF UNEMPLOYMENT.

YEA, THOUGH I WALK THROUGH THE VALLEY OF THE BREAD LINE,

I SHALL NOT GO HUNGRY.

OBAMA HAS ANOINTED MY INCOME WITH TAXES,

MY EXPENSES RUNNETH OVER MY INCOME,

SURELY, POVERTY AND HARD LIVING WILL FOLLOW ME ALL THE DAYS OF MY LIFE.

THE DEMOCRATS AND I WILL LIVE FOREVER

IN A RENTED HOME.

BUT I AM GLAD I AM AN AMERICAN,

I AM GLAD THAT I AM FREE.

BUT I WISH I WAS A DOG

AND OBAMA A TREE.


1c) Subject: Investment Banker Jokes


Q: What’s the definition of optimism?
A: An investment banker who irons five shirts on a Sunday evening.


A man went to his bank manager and said: ‘I’d like to start a small business. How do I go about it?’ ‘Simple,’ said the bank manager. ‘Buy a big one and wait.’

The credit crunch is getting bad, isn’t it? I mean, I let my brother borrow a ten a couple of weeks back, it turns out I’m now America's fourth biggest lender.

Q: What is the difference between an investment banker and a pigeon?
A: A pigeon can still make a deposit on a BMW.

Q: What is the difference between an investment banker and a large pizza?
A: The pizza can still feed a family of four.

Q: What does a hedge fund manager with no fund to manage say?
A: Would you like fries with that sir?

Q: What is the capital of Iceland?
A: About $3.50

Mark Twain was ahead of the curve: “October. This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.”

2) Israeli Capitalism: Time to Shift Leftwards
By Yisrael Ne'eman


The era of boorish capitalism is drawing to a close as markets around the world are shaken by the American sub-prime disaster. The ripple effect not only collapsed such enormous investment houses like Lehman Brothers but also threatened Merrill Lynch, the insurance giant AIG and the mortgage companies Freddie Mac and Fanny Mae. In today’s global village no one works in a vacuum. As we all know the U.S administration has begun a $700 billion bailout.

Not long ago communism/socialism came crashing down, not only with the end of Soviet domination of Eastern Europe and the unraveling of the Soviet Union from 1989-91 but with the defeat of much of the social welfare system worldwide. In many cases the former Russian satellite nations and republics became overwhelming in their capital incentive policies while Great Britain in particular replaced a collapsing socialism with hard line capitalism led by Margaret Thatcher in 1979. The United States, never a bastion of the welfare state became even more capitalist with the election of Ronald Reagan in 1980. Western Europe followed suit. For almost 30 years capitalism washed socialism aside and today we are paying the price of that massive victory.

Israel is no different. In some ways similar to Eastern Europe but also following socialist and mixed economy policies of many developing countries (often known as “state capitalism”) the Jewish State underwent several economic reforms from the 1980s onwards. Dead wood socialism where people went to their jobs but did not work, gained tenure over the years but could not be fired affected not only the public sector but the semi-private sector led by the Histadrut Labor Union. The Union represented the workers but also owned the factories or “means of production”. With declining productivity and massive managerial incompetence this socialist pillar of the economy was in decline in the 1970s and finally collapsed by 1988.

The entrepreneurial Likud led by Menachem Begin won their first election in 1977 and attempted a capitalist reorganization under finance minister Simcha Erlich but due to structural problems, incomplete planning/execution and Histadrut objections the blueprint failed and left the country with an inflation rate of 450% by the mid 1980s. The New Economic Policy of 1985 led by Labor Prime Minister Shimon Peres and Likud Finance Minister Yitzchak Moda’i during the period of national unity governments crushed Histadrut objections and brought about the rush towards big capital. Such a move was imperative to bolster Israel’s economy.

Capitalism became the new byword as the policies continued into the 1990s especially when seeking foreign investors. Opportunity presented itself during the Rabin-Peres Labor regime (1992-96) when economic barriers fell and Israel cashed in on the “peace dividend” of the Oslo Accords. Despite diplomatic setbacks in the peace process with the Palestinians the economy overall thrived and was further capitalized by Benyamin Netanyahu’s government in the late nineties and up through 2000 when Labor PM Ehud Barak was at the helm.

The final dismantling of most of Israel’s social welfare system took place in the past decade, not so much out of want but out of necessity. The Wall Street crisis of March 2000 and the Palestinian Low Intensity Conflict beginning half a year later brought about a massive economic crises leading to over 11% unemployment and the economy shrank by 1.9% in 2002. Social welfare benefits were cut back beyond the minimum, but most agreed that there was really no choice. Netanyahu as finance minister under PM Ariel Sharon was the architect of such widely approved planning. By 2005 the economy was booming again with growth rates in excess of 5% annually. Capitalism was seen as the great savior.

And it was – but only in the short term. Since then Israel is the western country with the largest gap between rich and poor, at least according to the official statistics. The “off the books” black economy is estimated by the respected economic journalist Sever Plotzker to be at least 15% but many believe it to be well over 20%. Not only the rich manage it but many in the middle class and especially working classes moonlight and supplement limited incomes. But despite such an officially unrecognized development there are more poor who are in a dire situation than there have been in two generations.

By the mid 2000s Israel’s stock markets took off with the wealthy attaining greater economic power while the poor sank into a morass. This trend has crashed to a halt with the global economy heading into a tailspin despite the American government’s best efforts to save the situation. Even the Republicans are in effect “nationalizing” major financial institutions as mentioned above.

This round of uncontrolled capitalism is finished. In Israel many believe elections are just around the corner. Whether it be the Likud, Kadima or even Labor, all followed similar policies to jump start the Israeli economy over the past 20 years or so. Lately Labor took a step back and introduced a pension plan for all workers, to get around the fact that most are no longer unionized and in the past decade have been terribly exploited. On the economic front the next government must ensure at least a minimal leveling of the playing field for the working public. Like the health care reform led by Haim Ramon in the mid 1990s there needs to be a socio-economic reform leading back to the welfare state in a nation resting on a mixed economy.

When socialism overtook the economy the price was paid by the workers swept out with the dead wood economy. Now it is time to partially re-regulate as far as capitalism is concerned. Best to learn from the American and British experiences before it is too late. Despite it all (including a massive slide by the Tel Aviv stock market this year) the Israeli economy is doing well and the government holds a fair amount of foreign reserves. A growing social gap will certainly bring about domestic instability. The time has come to implement a policy of social justice in an effort to close the gap, something all the economists of the leading parties know to do. We should begin with a return to partial state capitalism in the form of increased government investment in state infrastructures and the encouragement/regulations necessary for a mixed economy. It is just a matter of courage and the will to action.

3)Dick,
Thank you for the prosperity article and the heads up on the movie "Wrecking Crew." Thank you also for the FYI 's you send. They give deep insight. Here are some thoughts about the presidential campaign and the economy:

1. I sadly watch as McCain,in my opinion, continues to run a one-trick pony survival campaign vis a vis here is why you should not vote for Obama henceforth - Nobama. My respect for all of the reasons he was nominated declined in the aftermath as he seems to forget who he is and so I think the American voters will do the same come election day. Big difference between Survive vs Thrive campaign tactics and we are observing them at there best between the strategists and advisors of these two nominees. Obama is retrofitting and restructuring himself . Like him or not, if you don't use a character filter, that is the formula a change agent uses to adapt and become adept in the face of crisis.

2. Putting expertise on the back burner, If one was looking to be gender specific and find a female candidate to support,, Sarah Palin is not the female candidate of choice. That person was Hillary Clinton. Putting irate overtones or dissing women because many of us couldn't or wouldn't embrace Sarah Palin is disheartening to me.. I am happy for her that she got her 5 minutes of macro fame. Courage of conviction is a wonderful quality but not the only one if you are to be a leader of a nation. No different sentiment regarding McCain. Good for her that she takes it on the chin regarding the media. A good leader must develop a thick skin and not get lost in the mire of popularity or a slow news day.

3. Hillary's book, "It Takes a Village"-more than addresses the difficulties of educating children in general as well as the tug of raising a child in the public eye albeit successfully. Whomever becomes president should read that book because the formulas to have education succeed in this country which incorporates successful international models and strategies are prevalent and relevant to the education crisis we face and will continue to face. Much of her vision is spot on with regard to education irrespective of what one thinks of her politically. Obama should stop taking about kids getting to college and focus on early intervention as alluded to in last debate. No Child Left Behind is fundamentally flawed and the feds blew it and continue to blow it because they won't generate funding. Next bailout predication...education.

4. Vis a vis the Sarah Palin Downs Syndrome argument- having a down's syndrome child because you don't believe in abortion is not the same as choosing to have a down's syndrome child because you and your family are ready to embrace that journey.
4. Obama, if elected, will have a steep learning curve and must hit the streets running instead of having the luxury of navel (or naval :-) contemplation regarding his oversight of this nation. If he truly believes himself the be a change agent, this will be the most invigorating time to rise to the occasion by challenging himself to reach new thought levels and practices implementation. That is what change agents do. Past practices aside, he and the rest of us will have to hang on while we figure out which fundamentals to hold or fold and which directions we must seek as we forge ahead. Not a time for the feign of heart. Obama's advisors, got him this far. He beat out Clinton who should have had a well oiled advisory machine and she should have known the difference between recommendations to embrace or abandon. That's what a good leader knows. McCain resurrected himself from the dead when no one backed him to his becoming the Republican nominee. Where did that guy go and who is the impostor masquerading in his place? Obama keeps using Muhammad Ali's "rope a dope" tactics with McCain and it is working. McCain should have known how he got that nomination and why. That's what a good leader knows. Just ask General Giap.

5. I am confused about this whole market debacle. Regarding the market and economics, according to BEA the gdp increased 2.8% in the second quarter of 08 where first quarter increased .09% These increases were reflective of positive logs from exports, personal consumption expenditures and federal, state and local spending. All this with a declining housing market and bursting investment bubbles. So how did these big financial companies start folding like a "House of Cards?" Also the government issued billions of dollars in tax rebate payments, a micro bailout of sorts, to individuals so why the shocker at macro bailout to financial institutions? Mind you, from an individual standpoint being relatively prudent in my spending habits I am not pleased with the impact of the bailout strategies because of the spare the rod spoil the children analogy which could be applied if one sees the government through parent-child eyes. However, looking at what the US stands to lose as a placeholder in world economic position, I understand that this quick fix band aid approach must be done. Having said all of that, these last few months have had a devastating impact on my investment/savings plan and I am furious that I have to sit on the sidelines simulating a Disneyland "E" ticket ride (for those of us who remember those days where E tickets were given for their fastest scariest Disneyland joyrides ) and watch portfolio managers play poop and scoop, pump and dump, and short and distort so they can recoup their dollars at the expense of the individual investors.

6. Bottom line, pun intended, how many times politically, economically, and as a female who is not in support of Sarah Palin and wouldn't be if she were a male candidate either, do I have to bend over and take it in that end?

3a)Dick,

I disagree. Calif - educationally- is not a separate case. You can't embrace competition and choice with disparate dollars between states. You can't look at per pupil spending and not plan for the school house they live in, the materials they require to succeed, or the models of education that are far superior to what is implemented here. We cannot spend 3x more in new jersey than Calif and expect educational parity. we just can't. We throw dollars after children have been in school for several years instead of early intervention and detection in pre-school. Here's a concept. Pilot funding pre- school in comparative socioeconomic areas and not Headstart programs which cherry pick low income kids and lump them together, but main street kids and low income so kids less exposed to education at this age are not disadvantaged by daycare sitting they receive instead of classroom learning of more affluent kids. You never catch these kids up! I have spent 35 years living this mess. It is not rocket science. But the mantra of competition and choice is just that, Dick. The mantra of administrative bloat is ludicrous. Kids are falling farther and farther behind and then they drop out because they were competitively disadvantaged from the onset. Not by genes or map location but because the educational system is a failed them. Not because they weren't presented with skills. They were. We throw billions of dollars buying defense equipment. Whose going to operate them? Per /pupil spending is not the formula to help this country dig itself out of the educational rabbit hole it has created. No Child Left Behind is a magic act and our kids are disappearing behind the curtain. I have looked at this problem top down as district admin and bottom up as a teacher. You know what one of the biggest expenses a school district has? Transportation not education. Research how many districts are outsourcing bus service? The list goes on and on and none of those expenses are not included in your per/pupil ratio.


My response: Don't take it that way but what we already spend is an enormous sum per/pupil. It is not accomplishing what we need and yet other nations which spend less per/pupil are. I don't want or think we need to throw more money at the problem until we get a return on what we are currently spending. As for California, it is a special case because in California and you are willing to allow anything to impact everything. California is creative but it is also an economic basket case because of the liberal syndrome that money, more money and then more is the solution. Learn to live within your budget and then I will be more sympathetic. Dick

4)Presidential candidates emphasize tax policies in campaign:

Federal tax policy is one of the subjects the two candidates for president of the U.S. discuss most often. This article describes the tax policies of John McCain, the Republican Party candidate for president, and Barack Obama, the Democratic Party candidate.

Although McCain and Obama have outlined their tax policies, they have left many of the details, especially how they would pay for new tax breaks, unspecified. And, as with every political campaign, positions of the candidates may change. This article is based on what our office considers accurate, nonpartisan and unbiased information at the time of publication.

Individuals

McCain and Obama have put forward a large number of tax proposals impacting individuals. Many of their proposals are driven by the soon-to-expire tax cuts enacted in the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA).

Individual income tax rates

Before EGTRRA, the individual marginal tax rates were 15, 28, 31, 36 and 39.6 percent. EGTRRA and subsequent legislation gradually phased in lower rates, which for 2008 are 10, 15, 25, 28, 33, and 35 percent. EGTRRA also created the 10 percent rate, which subsequent legislation expanded and accelerated. Because of EGTRRA's sunset provision, the pre-EGTRRA rates are scheduled to return after 2010.

McCain. McCain has endorsed making all of the lower individual income tax rates in EGTRRA permanent.

Obama. Obama has proposed making the 10, 15, 25, and 28 percent rates permanent while restoring the pre-EGTRRA rates of 36 and 39.6 percent.

Comment. Obama has also proposed excluding individuals age 65 and older from federal income tax liability if they earn $50,000 or less along with creating a new "Making Work Pay" tax credit of $1,000 for lower and middle-income families and $500 for lower and middle-income individuals to offset federal payroll taxes.

Personal exemptions

Personal exemptions are allowed for the taxpayer, spouse and each qualifying dependent. The personal exemption amount for 2008 is $3,500.

Obama. Obama has not discussed increasing the personal exemption amount.

McCain. McCain has proposed increasing the dependent exemption (but not the personal exemption for the taxpayer and spouse) by $500 each year beginning in 2010 until it reaches $7,000 (in 2016), at which time it would be once again indexed for inflation.

Pease Limitation

For 2008, single individuals begin to lose some of the value of certain itemized deductions when their adjusted gross income (AGI) exceeds $79,975 ($159,950 for married couples filing jointly). This is commonly referred to as the "Pease limitation." Beginning in 2008, taxpayers only lose one-third of the amount otherwise required under the phase-outs, down from two-thirds in 2006 and 2007.

McCain. McCain has proposed making all of EGTRRA's tax provisions permanent, including the phase-out of the Pease limitation.

Obama. Obama has proposed allowing the phase-out of the Pease limitation to sunset after 2010.

Personal exemption phase-out

The deduction for personal and dependent exemptions may be reduced or eliminated for higher income individuals. EGTRRA gradually reduces the exemption phase-out until it completely disappears for tax years beginning after 2009. However, because of EGTRRA's sunset rules, the exemption phase-out would return after 2010.

Obama. Obama has proposed restoring the phase-out for personal exemptions.

McCain. McCain has endorsed making the elimination of the personal exemption phase-out permanent.

Marriage penalty

EGTRRA and subsequent legislation increased the standard deduction and tax rate brackets for married couples filing jointly to twice the amount applicable to single taxpayers to help close the so-called marriage penalty. Marriage penalty relief is scheduled to sunset after 2010.

McCain. McCain has endorsed making all of EGTRRA's tax cuts, including marriage penalty relief, permanent.

Obama. Obama has indicated his support for making marriage penalty relief permanent.

Child tax credit

The current $1,000 child tax credit was first increased by EGTRRA and then accelerated by subsequent legislation. The child tax credit, which is not indexed for inflation, will remain at $1,000 until EGTRRA sunsets after 2010.

McCain. McCain has supported making the child tax credit permanent.

Obama. Obama has indicated his support for making the child tax credit permanent.

Child and dependent care credit

The child and dependent care credit, which is nonrefundable, is a percentage of the amount of work-related child and dependent care expenses a qualifying taxpayer paid to a care provider. The credit can reach as high as 35 percent of qualifying expenses.

Obama. Obama has proposed making the child and dependent care credit refundable and enhancing it to reach as high as 50 percent of qualifying expenses.

McCain. McCain has not addressed the child and dependent care credit.

Federal estate tax

EGTRRA gradually reduces the federal estate tax rates and totally repeals the federal estate tax for 2010. EGTRRA also gradually increases the exemption amount. After EGTRRA sunsets, the pre-EGTRRA tax rates and exemption amount ($1 million) return. The top marginal estate tax rate is 45 percent for 2008 and 2009.

McCain. McCain has proposed a 15 percent federal estate tax rate and a $5 million exemption amount.

Obama. Obama has proposed a 45 percent federal estate tax rate and a $3.5 million exemption amount. It appears unclear at this time whether the rates will be progressive and at what level the 45 percent rate would apply.

Alternative minimum tax (AMT)

Nearly 40 years ago, Congress created the AMT to prevent a small number of very wealthy individuals from evading taxation. Today, largely because the AMT was not indexed for inflation, tens of millions of taxpayers are potentially liable for the tax. However, Congress has kept the AMT from encroaching on middle income taxpayers by enacting so-called "patches," which increase the AMT exemption amounts and allow taxpayers to use most nonrefundable personal credits to offset AMT liability.

McCain. McCain has endorsed higher AMT exemption amounts and allowing taxpayers to use most of the nonrefundable personal credits to offset AMT liability. McCain has also indicated his support for "phasing out" the AMT but has not provided details of how the federal government would pay for the loss of AMT revenues.

Obama. Obama has proposed extending the 2007 AMT patch and raising the exemption amounts for inflation.

Dividends and capital gains

Qualified dividend income and capital gains tax rates for 2008 through 2010 are zero percent for individuals in the 10 and 15 percent tax brackets, and 15 percent for individuals in the higher tax brackets. When the lower rates sunset in 2011, the capital gains tax rate will increase to 10 percent for taxpayers in the 15 percent tax bracket, and 20 percent for taxpayers in higher brackets, while qualified dividend income will lose its preferential tax treatment (and dividend income will once again be subject to ordinary income tax rates).

Obama. Obama has proposed increasing the maximum tax rate on capital gains to 20 percent. One variation on the proposal has the 20 percent rate increase applicable only to families with incomes of more than $250,000 ($200,000 for individuals).

McCain. McCain would maintain the lower tax rates for both qualified dividends and long-term capital gains, ranging from zero to 15 percent.

Retirement savings

The Internal Revenue Code includes numerous tax incentives to encourage individuals to save for retirement. One of these incentives is the nonrefundable saver's credit. In addition, the Pension Protection Act of 2006 enhanced the ability of employers to provide automatic enrollment in retirement plans, like 401(k)s.

McCain. McCain has not addressed the saver's credit or automatic enrollment. However, he has discussed alternatives for retirement savings, such as creating personal accounts for younger employees.

Obama. Obama has proposed expanding the saver's credit and making it refundable and has indicated his support for automatic enrollment in 401(k)s, IRAs and similar arrangements.

Education tax incentives

Beginning in 2008, the maximum amount of the nonrefundable Hope scholarship credit is $1,800 (100 percent of the first $1,200 and 50 percent of the next $1,200) per eligible student for qualifying higher education expenses.

Obama. Obama has proposed making the Hope credit a 100 percent refundable credit for the first $4,000 of qualified higher education expenses.

McCain. McCain has not addressed education tax incentives.

Earned income tax credit (EITC)

The EITC is a refundable federal income tax credit targeted to lower-income taxpayers. When the EITC exceeds the amount of taxes owed, it generates a refund to those who claim and qualify for the credit.

McCain. McCain has not addressed the EITC.

Obama. Obama has proposed expanding the EITC to cover more families and children and boosting the phase-out threshold for married couples filing jointly.

Health benefits

A majority of Americans are covered by employer-provided health benefits. Code Sec. 106(a) generally excludes from an employee's gross income employer-provided coverage under an accident or health plan.

Obama. Obama would preserve the current income tax exclusion for employer-provided health benefits. He has also indicated support for targeted health care tax credits, largely to help lower-income individuals and also for a small business health care tax credit to offset the cost of providing health benefits.

McCain. McCain has proposed treating employer-provided health benefits as taxable compensation to the employee for federal income tax purposes. He has also proposed creating a refundable tax credit of $5,000 for families and $2,500 for single individuals to offset the loss of the exclusion.

Social Security taxes

Social Security is funded by payroll taxes. However, workers pay Social Security tax only on the first $102,000 of their annual incomes for 2008.

McCain. McCain has not addressed the Social Security payroll tax cap. He has discussed various alternatives for retirement savings, such as creating personal accounts for younger employees.

Obama. Obama has proposed a payroll tax of four percent (two percent each from employer and employee) on wage income of higher-income individuals (such as over $250,000).

Businesses

Obama and McCain have also proposed corporate tax reform. Their proposals, among other things, would lower the U.S. corporate tax rate and make the research tax credit permanent.

Corporate tax rate

Currently, the U.S. has the second highest corporate income tax rate among industrialized nations. The current top corporate income tax rate is approximately 39 percent.

Obama. Obama has proposed lowering the corporate income tax rate to 35 percent and broadening the corporate income tax base.

McCain. McCain has proposed gradually lowering the corporate income tax rate from 35 percent to 25 percent, as well as broadening the corporate income tax base.

Research tax credit

Qualifying taxpayers may claim a tax credit of 20 percent for research and experimentation expenses above a certain base amount. The research tax credit is a nonrefundable credit. The research tax credit expired at the end of 2007.

McCain. McCain would expand the research tax credit and make it permanent.

Obama. Obama has indicated support for making the research tax credit permanent.

Small business depreciation and expensing

Congress has relied several times over the past few years on enhanced Code Sec. 179 small business expensing and accelerated depreciation to stimulate economic growth, most recently in the Economic Stimulus Act of 2008. It is likely that lawmakers will continue these incentives in the future.

Obama. Obama has not addressed small business expensing and depreciation.

McCain. McCain has proposed an immediate, but temporary, first-year deduction of the full cost of 3- and 5-year business equipment purchased between 2009 and 2013, during the year in which the equipment is placed in service. McCain has also proposed eliminating the interest deduction for expensed equipment.

Domestic production activities deduction

Code Sec. 199 allows a deduction for qualifying manufacturing activities. When fully phased in by 2010, the deduction will equal nine percent of the less of qualified production activities for the year or taxable income for the year.

McCain. McCain has endorsed repealing the Code Sec. 199 deduction.

Obama. Obama has indicated support of repealing the Code Sec. 199 for oil and gas companies.

Energy

Congress has used the Tax Code several times in recent years to encourage consumers and businesses to make energy-efficient purchases and conserve energy. Many of the tax incentives, however, are temporary.

McCain. McCain has proposed an end to ethanol subsidies and has discussed a temporary federal gas tax holiday. In addition, McCain has also proposed a tax credit for buying zero emission cars.

Obama. Obama has proposed expanding and extending renewable energy and conservation tax incentives and repealing tax incentives for oil and gas companies. Additionally, he has discussed energy rebates for individuals to help offset the cost of home heating.

Possible revenue raisers

Both candidates have described possible revenue raisers:

Obama. Some of Obama's proposals for tax offsets include:

* Taxing "carried interest" - profits paid to compensate hedge-fund managers-- as ordinary income;
* Codifying the economic substance doctrine; and
* Requiring information reporting of basis for gains.

McCain. Some of McCain's revenue raisers include:

* Corporate base broadening;
* Reduction in certain business tax preferences; and
* Eliminate oil/gas "loopholes."

5)Syrian 3rd Army moves south from Iraq border to face Lebanon and Israel

According to military sources, the removal of Syrian forces is intended to punish the US twice for last Sundays’ commando raid in northern Syria which killed 8 people including Abu Ghadiyah, the Syrian controller of smuggled insurgent fighters and weapons into Iraq. First, the 8th Army’s removal opens the Iraqi border open to the free passage of al Qaeda, Fatah al-Islam and Iraqi insurgents for attacks on US forces in Iraq. Second, Syrian troops are now massed in position to bring military pressure to bear on US allies in South Lebanon and Israel.

These developments have set the stage for more US strikes on Syrian soil to hit back at the jumping-off bases used by terrorists and insurgents to attack US targets. US Homeland Security Minister Michael Chertoff said Friday: “A country should have the right to attack another if it is harboring a potential terrorist threat.”

The Syrian 3rd army, which is composed of two Border Guard brigades and two more of infantry and assault helicopters, began moving south Wednesday, Oct. 29, evacuating the 600 km stretch of Syrian-Iraqi border they manned for the past year under a US-Syrian agreement.

The US embassy in Damascus was shut Thursday over an “increased security risk” as tens of thousands mounted an anti-US protest in the town center. The embassy has warned Americans in Syria to stay on alert.

6) Has Obama Overplayed the Race Card?
By Marc Sheppard

How ironic that the same Senator sponsoring the Deceptive Practices and Voter Intimidation Prevention Act of 2007 (S.453) would not only tacitly condone, but actually participate in racial intimidation to advance his presidential prospects. Obama keeps cautioning crowds that "the race is not over," all the while knowing his race most certainly is over: all over every facet of his ambitious strategy to make political history. And, while it began with restrained victim role-playing ("McCain will say 'he doesn't look like the other presidents on dollar bills'"), recent follow-through by his disciples has been about as subtle as a hand grenade -- and it may just be backfiring.

After all, they're now exploiting their candidate's color from virtually every angle imaginable, and many who may have previously felt inclined toward politically correct acceptance are now moving in the direction of downright indignation.

Take, for instance, this August entry from Slate's Jacob Weisberg, who suggested that even though we "may or may not agree with Obama's policy prescriptions," Americans should vote for him anyway. Why? Get a load of this:

"We would finally be able to see our legacy of slavery, segregation, and racism in the rear view mirror. Our kids would grow up thinking of prejudice as a non-factor in their lives. The rest of the world would embrace a less fearful and more open post-post-9/11 America."


While mind-blowingly incomprehensible to those not blinded by the fairy-dust, Weisberg put to words precisely the reckoning-based nonsense so many on the Left have been trying to sell. But hold on to your sanity, he was just warming up:

"But does it not follow that an Obama defeat would signify the opposite? If Obama loses, our children will grow up thinking of equal opportunity as a myth. His defeat would say that when handed a perfect opportunity to put the worst part of our history behind us, we chose not to. In this event, the world's judgment will be severe and inescapable: The United States had its day but, in the end, couldn't put its own self-interest ahead of its crazy irrationality over race."


Beyond the contemptible suggestion that this contest represents an opportunity to "put the worst part of our history behind us," the sanctimonious declaration that an inexperienced super-liberal's failure to win the White House on his first attempt is "inescapable" proof of our "irrationality over race" simply doesn't stand to reason. The fact that this guy is still employed after using the decency of "our children" and the judgment of "the world" to shame us into PC submission, suggesting this as Obama's -- or any other black man's - only shot at the White House, is simply astounding.

Are any but the most committed multi-cultist fanatics daffy enough to allow such nonsense to accompany them into the voting booth?

Only Ignorant, Inbred, Redneck Racists Will Vote for McCain

Apparently, in their insatiable thirst for Democratic authoritarianism, the Left is taking no chances. So they're adding insult to their guilt-mongering.

Newsweek's Jonathan Alter's perchance prescient October 25th piece, Why McCain Won, blames a hypothetical Obama loss on the 60% of the electorate he calls LIVs ("low-information voters'), who not only don't vote in primaries:

"They don't read news magazines or newspapers, don't watch any cable news and don't cast their ballots early. Their allegiance to a candidate is as easily shed as a T shirt. Several million moved to Obama through September and October; they'd heard he handled himself well in the debates. Then, in the last week, the LIVs swung back to the default choice: John McCain. Some had good reasons other than the color of Obama's skin to desert him; many more did not."


As an example of the "many more" that voted against Obama's pigmentation Alter offered the "erosion in the critical I-4 corridor near Tampa and in the Panhandle, where the astonishing Republican margins among whites could be attributed only to race." Mr. Alter's apparent ignorance of or dishonest disregard for the comfortable victory these regions handed George Bush in both 2000 and 2004 leaves one wondering just who deserves to be branded "low-informed."

And speaking of ignoramuses, Alter's followed the rantings of one Jack Murtha -- who castigated his own constituents 10 days earlier when he claimed many would not vote for Obama because "western Pennsylvania is a racist area." The bloated Congressman quickly attempted to walk back the sting of the accusation by suddenly remembering he meant to say the area was "really redneck." Nice save. Hopefully, his dumb mouth will put both his House seat and Obama's lead in the state in jeopardy. After all, no one likes being called stupid.

A reality apparently lost on West Virginia State Democratic Party Chairman Nick Casey who took the name calling to an entirely new level. During an October 18th bus-tour road performance, the inimitable Obama cheerleader incited a Beckley, WV crowd by telling them "there's a lot of people out there think you're a bunch of inbred, redneck racists."

Yes he did.

Then, after eliciting loud cries of "No!" from the 300-strong union hat and jacket wearing horde by rhythmically screaming the questions "Are you ignorant? Are you inbred? Are you racist?" -- he delivered the hay maker:

"John McCain is confident that ignorant, redneck racists are not going to vote for Barack Obama, because Barack Obama is black."


So much for Liberal tolerance.

Of course, anyone on the receiving end of such abuse actually swayed by it likely deserves to be called ignorant. Hopefully, most were rightfully repulsed.

Don't call me Socialist, Whitey

Rather than dispensing their duties as public watchdogs by unraveling the mystery that is Barack Obama, the media at large have done their collective best to maintain his shroud of secrecy. As volunteers for the Obama election committee, they have joined with Left leaning politicians in general and certain black ones specifically to move all matters uncomfortable to their candidate out of bounds by unilaterally declaring them racially insensitive. And when I say all matters, I mean just that, regardless of relevance. For instance:

* As Black racism is the direct result of White racism, any mention of racist Jeremiah Wright or the Obamas' 20 years of receiving his anti-American anti-White sermons, is itself, racist.
* As ACORN is largely a black organization concerned primarily with minority issues, any questions about the multi-state vote-rigging allegations against them or Obama's involvement therein is racist.
* Mentioning Obama once "palled around" with Bill Ayers is racist - despite the domestic terrorist's white face.
* Suggesting minority-centric lending policies were factors in the Fannie/Freddie collapse is racist; more so if former Fannie Mae CEO Franklin Raines' name is surfaced.
* Calling a black man "articulate and bright and clean" is racist as it apparently implies most are not.
* "Arrogant" and "Elitist" are both code-words for "uppity" which has a particularly pernicious meaning when applied to anyone of color.
* "Socialist" is a code-word for black.
* "Community Organizer" is also a code-word for black
* Even "Inexperienced" is a code-word for black.
* "Celebrity" is a code-word for black, and a subliminal reference to black-on-white rape when juxtaposed with celebrities of fair and soft skin.


While the use of empty allegations of racism to end debate is nothing new, can anyone read the preceding bullet list and not be completely fed up with this tactic?

The White Fear Factor

This is where the racial intimidation rubber truly meets the road.

Reports are popping up claiming that urban police departments are preparing for "whatever may happen on Election Night." Some of the buzz is over "massive protests" should Obama lose.

But some plays directly to fear. Fear that protests may escalate to violence. Mysteriously, this angry black man stereotyping seems to suit the race-baiters just fine, thank you.

Granted, the concern didn't spring solely from the Liberal well. As far back as January, Jonah Goldberg predicted that if Obama's "rendezvous with destiny" were to be denied, "teeth shall be gnashed, clothes rent and prices paid." That same month, I myself asked "should Obama prevail in the primaries, just what might we expect were he to lose the general election, particularly in a squeaker?" Two months later, Fox Radio host Tom Sullivan proffered an answer when he projected there'd "be riots in the streets."

But once Obama's status changed from long shot wannabe to serious contender, concerns from the Right quickly gave way to threats from the Left.

In early September, Philadelphia Daily News writer Fatimah Ali stoked the fires by declaring:

"If McCain wins, look for a full-fledged race and class war, fueled by a deflated and depressed country, soaring crime, homelessness - and hopelessness!"


Weeks later, a Newsweek article answered its evocative title What If Obama Loses?, partially with this quote from rapper Snoop Dogg:

"People that I know that have never cared about politics are registering to vote this time: gang members, ex-cons, you name it. I hate to see a lot of that hope go down the drain, and if he loses, it will."


But it's not just ticked off gang bangers and ex-cons they'd have us fear. In the same article, they quote California construction worker Daetwon Fisher:

"I'm going to be mad, real mad, if he doesn't win. Because for him to come this far and lose will be just shady and a slap in black people's faces. I know there is already talk about protests and stuff if he loses, and I'm down for that."


Of course, it wasn't only blacks putting us on notice. On October 7th, Democratic strategist James Carville assured CNN's Anderson Cooper that "if Obama goes in and he has a consistent five point lead and loses the election, it would be very, very, very dramatic out there."

Truth be told, the most likely blood-letting brought on by an Obama loss will be that of MSNBC blowhards hitting the pavement after doing a Peter-Pan from their office windows. Nonetheless, while the candidate himself has never suggested there'd be violence, neither has he called for calm should he lose. Nor have we heard his denunciation of the epithets being slung at rural people he himself once accused of "clinging to guns and religion."

By overplaying their race-card hand, the campaign may very well have weakened the white guilt wind once at their backs. As a result, next Tuesday's voters will likely be more concerned with how Obama intends to reshuffle the wealth deck than the cards he has dealt from the race deck.

And with the RCP Poll Average gap trending narrower over the past 6 days, that's good news for John McCain.