Tag Archives: investor

Booze and Women

Regarding the new GOP tax plan which shuffles billions of dollars from working Americans to the top one-half of one per cent.

“I think not having the estate tax recognizes the people that are investing,” Grassley told the Register. “As opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies.”

I am not sure if this is true so I interviewed 2 people. One is a billionaire heiress to a real estate fortune who shall remain anonymous. I shall call her Ivania. The other is a shmuck who worked in factories, sweat shops and as a teacher for over 30 years. I will call him Joe the Shmuck.

Me: Hello, Ivania. Congratulations on receiving a massive inheritance allowance and other tax breaks in the new tax bill.

Ivania: Thank you. No one deserves it more than me.

Me: So, how many jobs do you intend to create with this new found wealth ? Do you feel that you that have earned this windfall?

Ivania: Oh, yes. I have had to work very hard being born into just the right family. It is not easy being wealthy. For example, do we cater in Lobster Newberg or Filet Mignon tonight? Do we open the bottle of “Moet and Chandon Dom Perignon” or the “Boerl and Kroff Brut Rose” ? Would you have any idea which to serve? Commoners just don’t understand the intense pressure I am under.

Me: I see. Back to my question. What do you intend to do with this multi-million dollar windfall? Will you invest it in new jobs in America?

Ivania: Of course. My investment advisor has already begun adding to my investments. I have created thousands of jobs already in my tote bag and high heel shoe factories.

Me: But aren’t those factories in China? And Vietnam?

Ivania: Well, yes. But there is a trickle down effect. Eventually, as we create jobs in China and depress wages in the US, we will be able to bring back jobs to this nation I love so dearly. American commoners must be able to compete with the wages we pay in China. We hope to someday get those wages on par with each other. Right now it is those unions that prevent us from creating more good jobs in the nation I love.

Me: OK. So, you won’t be investing in the USA, is that the bottom line.

Ivania: (chuckling)  I got mine. That is the bottom line. Did I mention how much I love America?

So, after this rather unsatisfying interview I found Joe the Shmuck, retired factory worker and teacher.

Me: Hello, Joe the Shmuck. Can I call you Joe?

Joe the Shmuck: I have spent my entire adult life working for a living and paying my taxes. You can call me Shmuck.

Me: OK, Shmuck. Senator Grassley has made the comment that people like you will just take any tax break and spend it on women and booze. What is your response?

Shmuck: DUH. Of course we will. He is correct.

Me: WOW! So you admit that you will spend any tax breaks on women and booze? Really?

Shmuck: I have in the past, why change now? What choice do I have?

Me: Explain to me then why you should get a tax break if you will just spend it on women and booze?

Shmuck: Look, I worked two jobs most of my life. At least 8 hours a day. Some days 12 hours or more. I have worked in factories, day labor, teaching and coaching and advising students. All for pretty meager wages. So, what do you think? I am not going to come home and have a beer? Of course I spend my money on booze. Wouldn’t you?

Me: Well, ok. but what about spending all your money on women?

Shmuck: I have a wonderful wife and a wonderful daughter. Unfortunately they are money pits. I mean, who needs more than 2 pair of underwear? Women, that’s who. Who needs to get their hair done? Women, that’s who. Not to mention quality food, clothes and  thousands of other items the uses of which completely escape me.

Let’s talk about dental bills and braces, shall we? And schools class trips? And second cars? And dogs and all those expenses? And Xmas gifts? And tuition and fees?

Me: I am not sure that was what Grassley was referring to…

Shmuck: Well, anyone who has a wife and daughter (or husband and son for that mattter) knows what I am talking about. So Grassley is right. All I will do with any tax break is invest in goods and services right here in the US…wait…does that make me an investor?

Me: Sorry. Investors only invest in China. You worked . You supported your family. You drink beer. You are what we call…uh… shmuck.

https://www.washingtonpost.com/news/morning-mix/wp/2017/12/04/grassley-explains-why-people-dont-invest-booze-or-women-or-

https://financesonline.com/top-10-most-expensive-champagne-bottles-in-the-world/

https://www.forbes.com/sites/stuartanderson/2015/08/17/trump-the-hypocrite-investing-overseas-fine-for-him/#4d5a62aa1dc8

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Filed under Congress, Debt, economics, Economy, GOP, government, liberals, minimum wage, pensions, Politics, Republicans, Taxes, United States

The Economy or The People?

Watching parts (I have a weak stomach) of the GOP debate on the “economy” I think I finally figured out the problem. I am slow, I admit.

The first question by the Fox Business/ Wall Street Journal panel exposed the issue pretty clearly. Should the minimum wage be raised to $15 an hour? Which is about $31,000 per year according to the panelist.

The answer, across the board, was NO. It would hurt “the economy” to raise the wages of people now making maybe 7 or  10 or 12 bucks an hour. It would devastate the economy to have poor working people making a little more to spend.

Trump, by is own admission a billionaire, sees nothing but ruin if a fast food worker were to get a few more bucks. And Carson agrees.  The end of the US “economy” as we know it. Catastrophe.

Another question asked by the panelists was about the great disparity between a CEO average pay and that of one of his workers. It used to be 20 to 1. Now it is 300 to 1. I don’t think any candidate ever actually responded to that one. The non answers were clear. No problem.

So, what seems clear to me now (as I said, I am slow) is that the GOP candidates have a completely distorted world view of what an “economy” is and what an “economy” does. Or is supposed to do.

Simply put, an economy is how goods and services are organized and distributed in a given society. The purpose of an economy should be what? To be organized so all members of a society have a chance to benefit from the wealth of that society. If not, then we must assume the “economy” has, as it’s central purpose, the organization of goods and services to benefit only a portion of the society.

The GOP concept of an “economy” seems to accept the second concept, that the economy should be organized to help only portions of society.. The economy to them seems to mean only one thing. How much profit is generated for the investor class. While they talk about “job creation” they are really talking about cheap labor so that investor profits will be higher. Not job creation so workers can have a decent life. Or participate in the overall economy in the broadest sense.

Now there is nothing wrong with investors making a profit. That is how the capitalist system (flawed though it is)  works. Since investors are allowing others to use their money  they deserve a reasonable return. But what is not reasonable is defining the “economy” ONLY in terms of investor profits. It skews the argument and is not a realist view of what an economy is all about.

When the GOP candidates say that a higher wage for workers hurts the “economy’, what they mean is a higher wage for workers cuts into investor profits. Which is true. Of course, taken to it’s logical conclusion one could argue that slavery is the best system for the “economy” because it reduces all labor costs for the investor. Hence, a slave economy, by definition, would be the “strongest” economy under the GOP world view. Tried that once, if I recall.

The GOP candidates, with real concern for the plight of poor Americans, pointed out that 1 in 5 kids now live in poverty. But their solution to this is NOT to raise the minimum wage so these children and their parents can escape poverty. Somehow, this system of keeping poor people underpaid is “good” for the economy. And it is, if you define the economy as the GOP does. A system designed to promote investor profits.

For the Democrats the challenge is simple. Help folks understand that the GOP definition of the economy is narrow and incomplete. Not evil. Not anti- poor.  Not racist. But simplistic and wrong. An economy is more than profits for investors. It is a system that is supposed to work for ALL members, not just a few.

A productive economy is one that is balanced so that workers who provide the labor to create profits benefit from that labor. And they benefit to such an extent that they can take advantage of the wealth they create. Investors also benefit by making a reasonable rate of return on their investments. A balanced system that recognize both halves of the equation.

Back in the days when the CEOs made only 20 times as much as the average worker the economy was better than it is today.  Investors made good profits and paid their fair share of taxes. Guess what? The economy worked for most people. Yes, some were poor. But the investor class did ok.  Not a single member needed food stamps.

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