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I was on a conference call this afternoon with Danny Ayalon - Israel's Foreign Minister. He discussed the Palestinian effort to go before the U.N. and be recognized as a state.
Ayalon made these points:
Israel has been willing to negotiate - the Palestinians have not.
Israel has been willing to make concessions - the Palestinians have not.
Israel seeks more than just the signing of a document. Israel wants and expects a sea change of attitude, ie Israel wants and expects to see Palestinians stop teaching hate. Israel expects a real cultural change just not a signed paper resolving territorial issues.
Israel is saying to the world community, if the Palestinians are blessed by the U.N. it will not change matters on the ground. Reality will continue and the risk of further confrontation will most likely be the outcome. Furthermore, it will make any future Palestinian negotiations more difficult.
He also pointed to the destabilization in the area that has occurred due to the Arab Spring and the ongoing problems in Egypt, Libya, Syria and parts of Africa.
Ayalon also suggested the matter is one of morality not just political in nature.
He is hopeful many nations, as with the denouncing of the Goldstone Report, will either vote against and/or abstain in the U.N petition by the Palestinians for statehood. However, abstaining neihter carries the moral weight nor is as defining.
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Have you bought the newest LIBERAL LOGO set for your favorite radical?
Lego is always the first to jump on a new trend for kids...
Coddle rioters and blame victims for not being fair and giving more of their hard earned income. Now that is what I call wealth transfer and Progressivism at its best.
Meanwhile, in part 2, Uncle Tom Sowell continues his explanation of social disintegration.
(See 1 below.)
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An act of true integrity or because he is not running he feels freer to vote his conscience?
In a measured response to an interview with Hannity, Lieberman gave his assessment of Obama and his accomplishments etc. You decide. (See 2 below.)
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Maureen Dowd saves her 'traitor talk' for Perry but fails to pin the same tail on the Donkey Partyers who, along with Biden, accused The Tea Partyers of being terrorists.
But then objectivity is not something one should come to expect from a writer for The New York Times. Though, in a moment of personal objectivity I must admit, Dowd is beginning to diss her own favorite 'president cool.'
In the final analysis, Obama's failings, I repeat, are in large measure because he has been given an affirmative action pass throughout his adult life.
Stop and think about this: Were Obama a pro football draft choice would he have lasted a second in his first game appearance considering his previous background experience?
I daresay, they would have carried him out on a stretcher after the first tackle.
Today he moans and groans about intransigent Republicans telling him 'no more spending.' So what is he about to propose to box Republicans in - extend unemployment so everyone can go out and spend. Another government goody future generations will be saddled with - that's the Obama solution. How pathetic and Dowd calls that leadership? (See 3 below.)
American auto makers lost business because of shoddy cars, contempt for customers, being forced to succumb to outrageous union demands and tough and creative competition. I suspect Obama has lost a good bit of his voter base because of a poor functioning economy and lack of personal leadership. Now he is trying to woo voting sheep back into the pen. It will be interesting to observe how he does this. No doubt he will try his folksy comparison style, his clever sophisticated acrid humor and maybe he will lecture us as if we were school children. Most of all he will lie because that is so much a part of his DNA.
In the final analysis, Obama might do best by just blaming 'Bo,' the family dog! Ah, but our 'do something' president is going to run against a 'do nothing congress.' (See 3a below.)
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If Obama's poll numbers, regarding his handling of the economy, continue to plummet the only choice, he, Axelrod and Alinsky have is to try and steal the election. But before doing that. Obama is going to make another speech and ask Congress to allow him to spend now and cut later knowing cuts never happen In disney East while spending starts immediately.
The idea of extending unemployment sounds good to those Obama helped remain unemployed but the idea ends with paying many continuing to do nothing and/or deters them from seeking work. His new program proposal, in my humble opinion, will simply be about laying blame for re-election purposes.
Paint them nasty ''do nothing Republicans' in a corner and watch them squirm and wiggle.
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Remember when Obama dissed Supreme Court members in his State of The Union Speech?
Would it not be perverse if The Supreme Court decided the constitutionality of 'Obamascare' before the election and found it unconstitutional?
Normally, The Court would be reluctant to decide a case which might impact a presidential election but perhaps Chief Justice Roberts mightconsider it is pay back time and a slap on the wrist is in order? Justice is not always blind nor without feelings!
I believe, unlike our president, Chief Justice Roberts possesses greater dignity and integrity. (See 4 below.)
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Buffet gets buffeted for his own tax avoidance. (See 5 below.)
Meanwhile, you have heard the expression 'the rich get richer while the poor get children?' Well the rich seems to be declining in number but the poor still keep procreating. (See 5a below.)
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Finally, a green company goes red and the Greens see Red as the cause! What now Obama? More subsidies? More hot air about global warming? More fans on hills? (See 6 below.)
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A little more humor: A Jewish grandma and her grandson are at the beach.
He's playing in the water, she is standing on the shore not wanting to get
her feet wet, when all of a sudden, a huge wave appears from nowhere and
crashes directly onto the spot where the boy is wading.
The water recedes and the boy is no longer there...swept away.
The grandma holds her hands to the sky, screams and
cries: "Lord, my GOD, how could you?
Haven't I been a wonderful grandmother?
Haven't I been a wonderful mother?
Haven't I kept a kosher home?
Haven't I given to charity?
Haven't I lit candles every Friday night?
Haven't I tried my very best to live a life ow which you would be proud?"
A voice booms from the sky, "All right already!"
A moment later another huge wave appears out of nowhere and crashes on the
beach.
As the water recedes the boy is standing there.
He is smiling and splashing around as if nothing had ever happened.
The voice above booms again. I have returned your grandson. Are you
satisfied?"
She responds, "He had a hat..."
---
Dick
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1)1) Thomas Sowell Social Degeneration Part 2
Although much of the media have their antennae out to pick up anything that might be construed as racism against blacks, they resolutely ignore even the most blatant racism by blacks against others.
That includes a pattern of violent attacks on whites in public places in Chicago, Denver, New York, Milwaukee, Philadelphia, Los Angeles and Kansas City, as well as blacks in schools beating up Asian classmates -- for years -- in New York and Philadelphia.
These attacks have been accompanied by explicitly racist statements by the attackers, so it is not a question of having to figure out what the motivation is. There has also been rioting and looting by these young hoodlums.
Yet blacks have no monopoly on these ugly and malicious episodes. Remarkably similar things are being done by lower-class whites in England. Anybody reading "Life at the Bottom" by Theodore Dalrymple will recognize the same barbaric and self-destructive patterns among people with the same attitudes, even though their skin color is different.
Anyone reading today's headline stories about young hoodlums turning the streets of London into scenes of shattered and burning chaos, complete with violence, will discover the down side of the brotherhood of man.
While the history and the races are different, what is the same in both countries are the social policies and social attitudes long promoted by the intelligentsia and welfare state politicians.
A recent study in England found 352,000 households in which nobody had ever worked. Moreover, two-thirds of the adults in those households said that they didn't want to work. As in America, such people feel both "entitled" and aggrieved.
In both countries, those who have achieved less have been taught by the educational system, by the media and by politicians on the left that they have a grievance against those who have achieved more. As in the United States, they feel a fierce sense of resentment against strangers who have done nothing to them, and lash out violently against those strangers.
During the riots, looting and violence in England, a young woman was quoted as saying that this showed "the rich" and the police that "we can do whatever we want." Among the things done during these riots was forcing apparently prosperous looking people to strip naked in the streets.
The need to bring people down in humiliation that marked the mass violence against the Armenians in Turkey nearly a century ago, and that later marked the Nazi persecutions of the Jews in Germany, is still alive and well in people who resent those who have achieved more than they have.
A milder but revealing episode in England some time back involved burglars who were not content to simply steal things but also vented their hostility by scrawling on the wall: "RICH BASTARDS."
In the United States, young black thugs attacked whites with baseball bats and took their belongings in Denver, while voicing their hatred of whites. But it is all a very similar attitude to what has been found in other countries and other times.
Today's politically correct intelligentsia will tell you that the reason for this alienation and lashing out is that there are great disparities and inequities that need to be addressed.
But such barbarism was not nearly as widespread two generations ago, in the middle of the 20th century. Were there no disparities or inequities then? Actually there were more.
What is different today is that there has been -- for decades -- a steady drumbeat of media and political hype about differences in income, education and other outcomes, blaming these differences on oppression against those with fewer achievements or lesser prosperity.
Moreover, there has been a growing tolerance of lawlessness and a growing intolerance toward the idea that people who are lagging need to take steps to raise themselves up, instead of trying to pull others down.
All this exalts those who talk such lofty talk. But others pay the price -- and ultimately that includes even those who take the road toward barbarism.
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2)Lieberman: I Might Not Back Obama in 2012
By Hiram Reisner
Sen. Joe Lieberman says he is not sure he will back President Barack Obama’s re-election bid and will wait and see who the Republicans nominate. The Connecticut independent also told Fox News’ Sean Hannity Tuesday his decision will be based on which of the candidates will be most capable of getting America’s government “back in balance.”
“Somebody asked what are you going to do in next year's election. I said I’m an independent now and I’m going to approach it from the perspective of an independent —and I'm going to wait and see,” Lieberman said. “I got a year and a quarter — a little less than that — before I have to decide how to vote. I want to see who the Republicans nominate. This is a really important election — I don’t have to tell you.
“Some of it is about foreign policy — who is going to keep us strong in the world — and some of it, of course, is about who is going to show the leadership to get our government back in balance and the economy going again,” he said.
Hannity asked Lieberman how he judged Obama’s record and whether the senator’s support of 2008 GOP nominee Sen. John McCain hurt him among his fellow Democrats — whether he was “excoriated.”
“I don’t know if it is possible for a political party to ex-communicate — to continue on the religious theme — but that might have happened there,” Lieberman said. “Let me tell you some stuff I think that I was relieved that the president did on foreign policy.
“He didn’t do, what I think a lot of the liberal Democrats thought, which is the day after he got sworn in pull us out of Iraq — it has been a methodical withdrawal,” he said. “Secondly, he did surge our troops in Afghanistan. I think the withdrawal strategy now is a little quicker than I would have wanted — but he says he will listen to the generals if they tell him not to do that.”
Lieberman also said the economic stimulus package was probably the way to go at the time.
“The stimulus at the time I think was the conventional wisdom about what would help to get the economy going,” he said. “I think it probably kept us out of a deeper recession. Did it solve our problems? No. Was it all spent wisely? No. So, you know, it is a mixed record.”
Hannity then asked Lieberman about America’s relationship with Israel and whether Obama has strained the longstanding ties.
“I think the president is not anti-Israel —. I think he’s pro-Israel, but I think he’s handled the relationship with Israel in a way that has encouraged Israel’s enemies and really unsettled the Israelis,” Lieberman said. “Because the Israelis have one really good friend in the world — it’s us. But when the president of the United States acts in a way that makes the Israelis wonder whether we are for them, what it does is to discourage them from taking the risk that they would ever have to take to have a peace agreement with the Palestinians or anybody else.”
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3)Field of Dashed Dreams
By MAUREEN DOWD
The president was in “Afternoon of a Faun” mode, a rural deity playing on his panpipes in the woods. Then, suddenly, he stood very still as he sensed electoral danger.
After assuring Obama that she was a supporter, an Iowa mother named Emily asked the president at a town hall at the Seed Savers Exchange in Decorah what had gone wrong.
Standing in a setting that was Martha Stewart-perfect — a red barn with an American flag, surrounded by white pines, red cedars and pink zinnias — the president looked breezy in khakis and white shirt. But he seemed to tense up as Emily spoke.
“So when you ran for office you built a tremendous amount of trust with the American people, that you seemed like someone who wouldn’t move the bar on us,” she said. “And it seems, especially in the last year, as if your negotiating tactics have sort of cut away at that trust by compromising some key principles that we believed in, like repealing the tax cut, not fighting harder for single-payer. Even Social Security and Medicare seemed on the line when we were dealing with the debt ceiling. So I’m just curious, moving forward, what prevents you from taking a harder negotiating stance, being that it seems that the Republicans are taking a really hard stance?”
The president defended himself with a tinge of resignation: If the crazed bullies put a gun to your head, you must surrender.
“Now, I know that people would like to say ‘Well, just do something to get these guys under control,’ ” he told Emily, adding: “You don’t want to reward unreasonableness. Look, I get that. But sometimes you’ve got to make choices in order to do what’s best for the country at that particular moment.”
The answer must have seemed lame even to Obama because, on the spur of the moment, he felt backed into doing what many in his White House and party wish he had done long ago. He told Emily he would put forward “a very specific plan to boost the economy, to create jobs and to control our deficit.” (But not until September.)
Driving through Midwest cornfields in his opaque, black, custom-made, $1.1 million “Matrix” bus, our opaque president found himself in The Field of Dashed Dreams. If you don’t build it, they may not come.
Dubuque’s Telegraph Herald published a front-page editorial, suggesting to the president that he could have skipped the campaign-style trip and “sent the savings to Dubuque County and Northwest Illinois, which were inundated by flash floods less than three weeks ago” but didn’t get federal assistance.
Obama spent Tuesday here in Peosta squirreled away in rural economic forums; he said afterward that they talked about such things as cows grazing next to solar panels and “helping farms manage manure in creative ways.” The president made his sobering case that America is still great while Gov. Rick Perry barreled past on his own bus, breaking creative new ground in volatility.
As Obama did dressage, Perry galloped through Iowa like an unbroken stallion in danger of cracking a leg.
The Texas governor called the president “the greatest threat to our country” and questioned his patriotism and sense of duty. The former Air Force pilot said the military and veterans would prefer a commander in chief who had been in uniform.
Perry said Ben Bernanke, the Federal Reserve chairman, would commit a “treasonous” act if he “prints more money” and threatened Lee Marvin justice. “We would treat him pretty ugly down in Texas,” he said.
Why do conservatives always have to brand people traitors? Why can’t they just say “You’re mistaken”?
By the end of the day, it was a barroom brawl, with Karl Rove telling Fox News that it was not “presidential” to call the Fed chief, appointed by the second President Bush, a traitor. (When Team W. calls you a yahoo, you’re in trouble.)
Obama batted away the Texan, as did Jay Carney, the White House spokesman, who told me: “We may disagree with our political opponents, but we certainly think they’re all patriots — even those who wanted to secede from the union.”
While Perry was playing the retro trigger-happy cowboy, Obama was playing the retro henpecked husband.
In Cannon Falls, Minn., the president compared negotiating with House Republicans to negotiating with his wife.
“In my house,” Obama noted, “if I said, ‘You know, Michelle, honey, we got to cut back, so we’re going to have you stop shopping completely. You can’t buy shoes; you can’t buy dresses; but I’m keeping my golf clubs.’ You know, that wouldn’t go over so well.”
In Decorah, he said: “Everybody cannot get 100 percent of what they want. Now, for those of you who are married, there is an analogy here. I basically let Michelle have 90 percent of what she wants. But, at a certain point, I have to draw the line and say, ‘Give me my little 10 percent.’ ”
Maybe Michelle should be the one negotiating with the Republicans.
3a)Editorial: Did Bo (Obama's Dog) Eat The Recovery?
Blame Game: In his inaugural address 2 1/2 years ago, President Obama called for a "new era of responsibility." Yet lately, his main goal in life seems to be escaping any responsibility for the lousy economy.
It's getting so you have to keep a list of everyone and everything Obama wants to blame for the anemic economic recovery.
So far, it includes:
• President Bush: Obama continues to blame Bush for the mess he inherited, despite the fact that the recession had pretty much bottomed out by the time Obama took office and was officially over a mere four months after he was sworn in.
• ATMs: In June, Obama blamed automated teller machines and airport check-in kiosks for the lack of jobs, saying that "businesses have learned to become much more efficient, with a lot fewer workers."
• Republicans: On Monday, Obama said that because "some in Congress would rather see their opponents lose than America win, we ended up creating more uncertainty and more damage to an economy that was already weak" — a thinly veiled attempt to blame the GOP for the economic malaise.
• Gridlock: Obama goes after partisan impasses. What he's really complaining about is that lawmakers haven't enacted his latest "stimulus" plan — spending hikes, gimmicky tax breaks and a massive tax hike — that has already been tried and failed.
• The media: In July, Obama said the "splintered" press was in part to blame for Washington's failure to boost the economy. "If you never even have to hear another argument," he said, "then over time you start getting more dug in into your positions."
Listen to the Podcast
Subscribe through iTunes• Businesses: Obama has often blamed companies needlessly sitting on massive piles of cash. In May, he insisted that firms should "step up" and start hiring.
• Misfortune: "Over the last six months, we've had a string of bad luck," he said at a town hall on Monday, citing the Arab Spring, the Japanese tsunami and Europe's debt crisis. "So there were a bunch of things taking place over the last six months that were not within our control."
Just to be clear, Obama's policies alone are to blame for the current sorry state of the economy.
In his first two years, Obama had free rein to get his economic agenda through a heavily Democratic Congress: An $830 billion stimulus, billions more in auto bailouts, mortgage bailouts and cash for clunkers, ObamaCare and Dodd-Frank.
None of those packages worked. They produced the worst recovery since the Great Depression. That was true before the Arab Spring, the tsunami, Europe's debt crisis and before Republicans won back the House.
At a press conference this summer, Obama said: "I'm not interested in finger-pointing."
But that's all he's been doing for months.
Wouldn't it be nice if Obama instead were to live up to his inaugural credo and start his own "era of responsibility" by admitting his role in the country's economic slump?
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4)Election Looms in Health-Law Review.
By JESS BRAVIN
The Supreme Court is likely to decide by January whether a ruling on the constitutionality of the Obama administration's health law will come before or after the November 2012 election.
A federal appeals court in Atlanta struck down last week the law's requirement for most Americans to carry health insurance. It conflicted with another appellate ruling upholding the law, and makes it a virtual certainty the Supreme Court will step in to resolve the dispute.
What isn't certain is whether a high court decision would come before the end of its 2011-12 term next June. If the justices agree by January to hear an appeal, arguments likely will occur in March or April, with a decision before July.
Under normal practice, any case accepted after January gets kicked into the next term. That would mean the resolution would come after voters decide whether President Barack Obama, the health-care overhaul's champion, deserves a second term.
Bradley Joondeph, a Santa Clara University law professor, said an early decision on the Patient Protection and Affordable Care Act, derided by opponents as "ObamaCare," could benefit Republicans. "If the court upholds the law, the Republican base gets energized four months before the election," he said. "If it gets struck down, well, there go the guts of the centerpiece of Obama's domestic agenda."
The timing is also important to state governments and companies, which want to know whether they should go ahead planning for the law's central provisions to take effect in 2014.
While some conservatives have called on the court to fast-track the case, Supreme Court justices prefer not to be seen as political actors, and are unlikely to deviate from their normal procedures in order to time a decision before or after an election.
In addition, two appellate courts have yet to issue rulings on challenges to the health law. One of those challenges, at the U.S. Court of Appeals for the District of Columbia Circuit, is still awaiting arguments, set for Sept. 23, and the timing of its decision is uncertain.
Some parties to the case say the high court needn't wait because the issues have already been thoroughly reviewed by lower courts. Several federal judges have written lengthy rulings saying the health law's insurance mandate properly draws on Congress's power to regulate interstate commerce. Other judges have said Congress overstepped its bounds.
Earlier this year, the justices turned down a request for expedited review from Virginia Attorney General Ken Cuccinelli, who brought one of the challenges now pending in an appellate court.
In June, the Cincinnati-based U.S. Court of Appeals for the Sixth Circuit upheld the law by a 2-1 vote. The loser in the Sixth Circuit case, the Thomas More Law Center, a conservative advocacy group in Ann Arbor, Mich., already has filed a petition asking for Supreme Court review.
One factor that could sway the timing is the legal strategy of the Obama administration, which lost Friday's 2-1 ruling by a panel of judges at the 11th U.S. Circuit Court of Appeals in Atlanta. The administration has until Sept. 26 to ask the full 11th Circuit to review the case, or it could appeal directly to the Supreme Court.
Republican presidential candidate Herman Cain tweeted Tuesday, "We must keep pressure on Dept. of Justice not to delay the hearing of Obamacare case in Supreme Court! It cannot wait til 2012!"
Tom Goldstein, a lawyer who frequently argues before the Supreme Court and publishes the Scotusblog.com website, said he believes the government will seek the full 11th Circuit review. "They will not want to allow this panel opinion to stand," he said, because of the "momentum" against the insurance mandate generated by the 207-page ruling.
Supreme Court justices are likely to take particular interest in the 11th Circuit case, filed by 26 mostly Republican state attorneys general and governors who are represented by Paul Clement, solicitor general in the Bush administration. While that panel found the insurance mandate unconstitutional, it unanimously upheld other provisions of the law expanding Medicare coverage for lower-income Americans.
—Ashby Jones contributed to this article.
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5)Warren Buffett's Tax Dodge
The billionaire volunteers the middle class for a tax increase.
Barney Kilgore, the man who made the Wall Street Journal into a national publication, was once asked why so many rich people favored higher taxes. That's easy, he replied. They already have their money.
That insight is worth recalling amid the latest political duet from President Obama and Warren Buffett demanding higher taxes on "millionaires and billionaires." Mr. Buffett is repeating his now familiar argument this week, coinciding with Mr. Obama's Midwestern road trip on the economy. Since the media are treating Mr. Buffett as a tax oracle, let's take a closer look at some of the billionaire's intellectual tax dodges.
• The double tax oversight. The Berkshire Hathaway magnate makes much of the fact that he paid only 17.4% of his income in taxes, which he considers unfair when salaried workers often pay more. But Mr. Buffett makes most of his income from his investments, in particular from dividends and capital gains that are taxed at a rate of 15%.
What he doesn't say is that much of his income was already taxed once as corporate income, which is assessed at a 35% rate (less deductions). The 15% levy on capital gains and dividends to individuals is thus a double tax that takes the overall tax rate on that corporate income closer to 45%.
This onerous tax on capital is a U.S. competitive disadvantage in the global economy, which is why Congress agreed in 2003 to cut the rates on dividends and capital gains. Even as the rest of the world is cutting tax rates on corporate income, Mr. Buffett wants to raise U.S. rates in a way that would make America less attractive for investment. Under a sensible tax reform, the feds would impose either a corporate tax or a dividend and capital gains tax, but not both.
• The middle-class bait-and-switch. Like Mr. Obama, Mr. Buffett speaks about raising taxes only on the rich. But somehow he ignores that the President's tax increase starts at $200,000 for individuals and $250,000 for couples. Mr. Obama ought to call them "thousandaires," but that probably doesn't poll as well.
The President needs to levy his tax increase at such a lower income level because that's where the money is. In 2009, 237,000 taxpayers reported income above $1 million and they paid $178 billion in taxes. A mere 8,274 filers reported income above $10 million, and they paid only $54 billion in taxes.
But 3.92 million reported income above $200,000 in 2009, and they paid $434 billion in taxes. To put it another way, roughly 90% of the tax filers who would pay more under Mr. Obama's plan aren't millionaires, and 99.99% aren't billionaires.
Mr. Buffett says it's only "fair" to raise his taxes, but he's lending his credibility to raising taxes on millions of middle-class earners for whom a few extra thousand dollars in after-tax income is a big deal. Unlike Mr. Buffett, those middle-class earners aren't rich and may earn $250,000 for only a few years of their working lives. How is that fair?
• The charity loophole. For billionaires like Mr. Buffett, the single most important deduction in the tax code is for charitable giving. Middle-class earners can't give nearly as much money away to reduce their overall tax burden. Yet we don't hear Mr. Buffett calling for the elimination of that deduction in the name of fairness.
Mr. Buffett has also already sheltered the bulk of his fortune from federal taxes by putting them into a foundation that will give the money away. That's an act of generosity, but if the government's purposes are so vital, why doesn't he simply give the money to the IRS?
Rebecca Quick of CNBC put that question to Mr. Buffett in 2007. His answer: "Well, that's a choice and it's an option . . . If I had to give it to a single individual, or make some young Buffett a multibillionaire, or give it to the government, I'd absolutely give it to the government. I think that on balance the Gates Foundation, my daughter's foundation, my two sons' foundations will do a better job with lower administrative costs and better selection of beneficiaries than the government."
Mr. Buffett is no doubt right about the relative efficiency of private donors, but should billionaire philanthropists get such a large tax preference? Another case of fairness?
Mr. Buffett is one of the great stock-pickers of his time, and we don't begrudge him a single dollar of his wealth. We only wish that, having already made himself rich, he weren't so intent on making it harder for others to become rich too. If he's worried about being undertaxed, we'd suggest he simply write a big check to Uncle Sam and go back to his day job of picking investments.
5a)Millionaires Go Missing
There's nothing like a recession to level incomes.
Speaking of "millionaires and billionaires" the real tax news is that there are fewer of both these days. This month the IRS released more detailed tax data for
2009, and the nearby table records the decline of the taxpaying rich.
In 2007, 390,000 tax filers reported adjusted gross income of $1 million or more and paid $309 billion in taxes. In 2009, there were only 237,000 such filers, a decline of 39%. Almost four of 10 millionaires vanished in two years, and the total taxes they paid in 2009 declined to $178 billion, a drop of 42%.
Those with $10 million or more in reported income fell to 8,274 from 18,394 in 2007, a 55% drop. As a result, their tax payments tanked by 51%. These disappearing millionaires go a long way toward explaining why federal tax revenues have sunk to 15% of GDP in recent years. The loss of millionaires accounts for at least $130 billion of the higher federal budget deficit in 2009. If Warren Buffett wants to reduce the deficit, he should encourage policies to create more millionaires, not campaign to tax them more.
The millionaires who are left still pay a mountain of tax. Those who make $1 million accounted for about 0.2% of all tax returns but paid 20.4% of income taxes in 2009. Those with adjusted gross income above $200,000 a year were just under 3% of tax filers but paid 50.1% of the $866 billion in total personal income taxes. This means the top 3% paid more than the bottom 97%. Yet the 3% are the people that President Obama claims don't pay their fair share. Before the recession, the $200,000 income group paid 54.5% of the income tax.
For the past three decades, the political left has obsessed about income inequality. As the economy experienced one of the largest and lengthiest economic booms in history from 1982-2007, the left moaned that the gains went to yacht club members.
Well, if equality of income is the priority, liberals should be thrilled with the last four years. The recession and weak recovery have been income levelers. Those who make more than $200,000 captured one-quarter of the $7.6 trillion in total income in 2009. In 2007 the over-$200,000 crowd had one-third of reported U.S. taxable income. Those with incomes above $1 million earned 9.5% of total income in 2009, down from 16.1% in 2007.
It's an old story: The best way to produce income equality is to destroy trillions of dollars of wealth. Everyone loses, but the rich lose relatively more than the poor and the middle class. By that measure, if few others, Obamanomics has been a raging success.
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6)Nevergreen Solar
Another political investment goes bust
In 2008, Reuters published one of those stories predicting that green power would be cost-competitive with fossil fuels in five years. Headline: "As Energy Costs Soar, U.S. Looks to Solar." Among the prophets was Richard Feldt, then the CEO of Evergreen Solar, who said that "it's not far away" and called for more subsidies. On Monday, Evergreen filed for Chapter 11 bankruptcy.
In the grave-dancing department, let's note that failure is part of the risk-taking and creative destruction that drive growth, and that Evergreen got its start in 1994 with an innovation that reduced the costs of silicon panels. The bankruptcy is notable mainly because the Massachusetts-based manufacturer received so much taxpayer support.
Governor Deval Patrick took a $58 million stake in Evergreen in 2007 with direct subsidies and tax breaks in return for the company building a plant in the state. The goal was "to help Evergreen Solar grow and thrive right here in Massachusetts, and give us a head start toward building a clean energy economy," Mr. Patrick said at the time.
But in January, Evergreen, shedding cash, shut down the Devens plant and fired 800 workers, claiming it was at a competitive disadvantage because U.S. solar subsidies are lower than China's. In a letter to the Journal, the U.S. solar lobby in Washington said the solution was to follow "Chinese policy makers" and make "strategic investments to attract this rapidly growing industry."
Mr. Patrick's economic development secretary, Greg Bialecki, told the Boston Globe that Evergreen's collapse was "a cautionary lesson," but not about the distortions and waste that come with the political allocation of capital. "We knew that it would be challenging to do that kind of manufacturing in the United States. It also probably suggests that Massachusetts can't do it alone—in other words, we probably also need federal policy," he said.
So the Commonwealth subsidies weren't enough for Evergreen to succeed because the federal subsidies weren't enough, even though with the stimulus the Obama Energy Department has become one of the largest venture capital firms in the world. And the federal subsidies will only be enough if Washington emulates the Chinese model of a state-planned economy. As Evergreen's bankruptcy shows, the real story is that the government-as-investor model isn't going to lead the U.S. back to prosperity.
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