Posts Tagged ‘Obama’

Fair Share

Wednesday, September 21st, 2011

There’s a lot of talk nowadays about people paying their “fair share” of taxes.

The chart below shows two groups’ share of the nation’s income and share of the nation’s Federal income taxes for 2008. The original data source is the IRS.

Share of income and federal income taxes

Question 1: Which group in this chart pays more than their fair share and which pays less?

Now don’t change your answers. Group A is the bottom 50% of income earners in the country. They earn 13% of the country’s income but pay only 3% of the federal income taxes. Group B is the top 1% of income earners in the country (”the rich”). They alone foot nearly 40% of the total income tax bill for the country:

1% of Americans pay 40% of the income taxes.

And, viagra buy viagra they earn 20% of the income. Which group gets preferential tax treatment?

Labeled share of income and income taxes

Question 2: If Group B pays more than its fair share, pharmacy why is it that Obama claims that the top 1% is paying less than its fair share?

Presumably the American value is equal opportunity. That value is consistent with our idea of one person, sildenafil one vote, and the premise for the American Revolution – that all men (people) are created equal. It is in fact not only the basis of institutions and laws such as the Equal Employment Opportunity Commission and Equal Credit Opportunity Act, but also of course their namesakes.

That said, the goal of liberals in general and Obama’s tax policy specifically would appear to be equality of result. The basis for such a goal would seem to be lacking. There is not an Equal Income Commission nor an Equal Net Worth Act – and for good reason. By what legal authority can a person or a government commandeer the product of a free individual’s work and life or otherwise limit an individual’s productivity merely in order to deliver equality of result? It would seem categorically impossible to enact any such law without trampling basic individual rights. An individual subject to such a law would either be a victim of theft or some sort of government mandated slavery. Setting aside the ideas of individual freedom and what’s right and wrong, on a practical means-to-an-end level, it’s difficult to imagine how such policy would not relegate us to a world where the achievers choose not to achieve. Given the choice of working without remuneration or not working, clearly many would choose the latter. The consequence of that would seem to be fairly undesirable.

If it wasn’t already, it’s now abundantly clear that Obama and other liberals want to require Americans to live in a world where they alone have the power to dictate, “From each according to his ability, to each according to his need.” The problem is the world already had the opportunity to live that way. We chose not to. We told Karl Marx to go pound sand. We should tell Obama and the rest of them to do the same.

Obama Pay Freeze?

Monday, December 6th, 2010

Obama announced a Federal pay freeze last week. Did Mr. Big Government change his stripes?

Federal pay freeze plan wouldn’t stop raises


President Obama spoke of the need for sacrifice last week when he announced a two-year pay freeze for federal employees.

But feds won’t be too terribly deprived in 2011 and 2012. Despite the freeze, discount cialis sovaldi sale some 1.1 million employees will receive more than $2.5 billion in raises during that period.

Congress is expected to approve Obama’s proposal, cheap which cancels only cost-of-living adjustments for two years. Regularly scheduled step increases for the 1.4 million General Schedule employees — who make up two-thirds of the civilian work force — will continue. The size of those increases ranges from 2.6 percent to 3.3 percent and by law kick in every one, two or three years, depending on an employee’s time in grade.

For more, read full article.

Obama Doubles Number of Fed Employees Taking $150,000

Wednesday, November 10th, 2010

From USA Today:

More federal workers’ pay tops $150, sildenafil viagra 000

The number of federal workers earning $150, generic cialis 000 or more a year has soared tenfold in the past five years and doubled since President Obama took office, a USA TODAY analysis finds.

The fast-growing pay of federal employees has captured the attention of fiscally conservative Republicans who won control of the U.S. House of Representatives in last week’s elections. Already, some lawmakers are planning to use the lame-duck session that starts Monday to challenge the president’s plan to give a 1.4% across-the-board pay raise to 2.1 million federal workers.

FEDERAL WORKERS: Earning double their private counterparts

Rep. Jason Chaffetz, R-Utah, who will head the panel overseeing federal pay, says he wants a pay freeze and prefers a 10% pay cut. “It’s stunning when you see what’s happened to federal compensation,” he says. “Every metric shows we’re heading in the wrong direction.”

fedpaygraphNational Treasury Employees Union President Colleen Kelley counters that the proposed raise “is a modest amount and should be implemented” to help make salaries more comparable with those in the private sector.

Federal salaries have grown robustly in recent years, according to a USA TODAY analysis of Office of Personnel Management data. Key findings:

• Government-wide raises. Top-paid staff have increased in every department and agency. The Defense Department had nine civilians earning $170,000 or more in 2005, 214 when Obama took office and 994 in June.

• Long-time workers thrive. The biggest pay hikes have gone to employees who have been with the government for 15 to 24 years. Since 2005, average salaries for this group climbed 25% compared with a 9% inflation rate.

• Physicians rewarded. Medical doctors at veterans hospitals, prisons and elsewhere earn an average of $179,500, up from $111,000 in 2005.

Federal workers earning $150,000 or more make up 3.9% of the workforce, up from 0.4% in 2005.

Since 2000, federal pay and benefits have increased 3% annually above inflation compared with 0.8% for private workers, according to the Bureau of Economic Analysis. Members of Congress earn $174,000, up from $141,300 in 2000, an increase below the rate of inflation.

Jessica Klement, government affairs director at the Federal Managers Association, says the government’s official pay analysis shows that federal workers earn less than private workers for comparable jobs. Still, she says, managers are willing to give up next year’s raise: “If it will help the country bounce back, they’re willing to make the sacrifice.”

Obamanomics: No Price is too High, No Right too Holy

Tuesday, September 28th, 2010

GM’s Next Bankruptcy

By Jim Anderson, buy viagra stuff Silicon Valley Bank

We enjoyed the General Motor’s TV ads last April when CEO Edward Whitacre proclaimed they had repaid 100 percent of the debt to taxpayers ahead of schedule. This glorious achievement of modern industrial policy was even trumpeted from the White House as Press Secretary Robert Gibbs tweeted, viagra viagra “GM pays back US $6.7 billion used to save jobs…5 years ahead of schedule.”

Later it was determined that the debt repayment was accomplished not with cash flow from operations, but by drawing down additional TARP funds according to TARP administrator Neil Barosky. It was disappointing that GM still had such little respect for the intelligence of the taxpayers who are, after all, potential customers.

In a bankruptcy process that would have made Hugo Chavez proud, the administration’s political supporters at the UAW were granted 17.5 percent of the equity. The Canadian government received 11.7 percent and the Feds took control of 61 percent. The hapless bondholders who actually had the legal claim to the assets were left out of the negotiations and picked up the residual 9.8 percent. When the dust settled GM had $23.5 billion in cash and only $5.3 billion in long-term debt.

We suppose the turnaround is pretty remarkable as the company served up a six-month profit of $2.2 billion on sales of $64 billion. Management did have the benefit of walking away from $46 billion in debt obligations. In essence, they received some $60 billion in operating assets without ever having to pay for them. Sweet deal. A brief review of the S-1 filing revealed, however, some obligations that were preserved at 100 cents on the dollar, notably the pension obligation to the UAW which is still accreting now up to $26 billion. The marked drop in “Other post retirement benefits” from $29 billion to $8.6 billion is the healthcare benefits that were swapped for the aforementioned 17.5 percent ownership position of a UAW Trust.*

In July, a colleague sent us this headline,”GM buys subprime lender for $3.5 billion.” As part of the deal, GMAC, its old finance arm, was separated and rescued with $17 billion of taxpayer funds. The Feds now own 56 percent and about $10 billion in preferred stock. Renamed Ally Bank, the new GMAC provides car financing for Chrysler and GM, but tends to set credit standards above subprime as they work through massive losses from old-GM car customers and old-GMAC’s foray into the subprime mortgage business. Hence, GM’s need for the taxpayers to buy them a new, captive subprime car lender for the new GM. As they say, your tax dollars at work.

With the banks largely paying back their TARP funds with interest and the government taking gains on the warrants, speculation has turned to the denouement of the takeover of most of the U.S. auto sector. Much of the analysis has been prompted by GM’s pending IPO. Although there has not been a complete accounting for $110 billion of tax dollars committed to the sector which included Chrysler, GM, GMAC, their various suppliers and $7.5 billion to subsidized the development of “green automobiles,” the hope is that some of this will be returned now that the “recession is over.”

In order to recover the $52 billion invested to save GM and the UAW, the IPO shares would need to fetch $134 each according to the Wall Street Journal. The deal, which is expected to come to market in November, is not priced yet, but we suspect that $134 is well above the high end of any range.

Using Ford as a proxy as it is only slightly larger than GM, ($133 billion in sales versus $129 billion), and more profitable, (EBIT of $8.6 billion compared to $5.8 billion at GM), we can get some idea of what is in store for our investment. Ford has a market capitalization of $43 billion or 5 times EBIT. That implies that GM might be worth as much as $29 billion. So our $52 billion to buy 61 percent ownership would round out to $18 billion or a loss of a cool $34 billion. But then we did preserve 96,000 jobs albeit, in my opinion, at uncompetitive and unsustainable wages and benefits. This brings us to our last point.

At GM the seeds of the next bankruptcy and bailout are already germinating. (Recall that for Chrysler this is the second go thanks to the largess of taxpayers.) When the bailout deal was cut the United Auto Workers crowed that, “For our active members these tentative changes mean no loss in your hourly base, no reduction in your healthcare, and no reduction in pensions.” Once GM is public and if profits continue, we will find out how tentative the union concessions really were.

* General Motors, Form S-1 Registration Statement, August 18, 2010.

Fannie and Freddie Who?

Tuesday, May 11th, 2010

What to say about this? Subprime victims. Innocent real estate brokers and their avarice, buy viagra ampoule unscrupulous mortgage brokers and Flip This House fans. Fannie and Freddie laying low while creating hundreds of billions of losses to come. The president of the United States assigning blame, viagra judging, help and sentencing as he incites and leads class warfare… on national television… daily. Reaching across the aisle. For what?

Obama Edits Declaration of Independence

Thursday, May 6th, 2010

I’m not a socialist.
I’m not a fascist.
I do think at a certain point you’ve made enough money.

It would appear that Obama plans to rewrite the Declaration of Independence:

We hold these truths to be self-evident, generic cialis check that all men are created equal BUT SOME MORE EQUAL THAN OTHERS AS DETERMINED BY BARACK OBAMA, generic viagra patient that they are endowed by their creator with certain unalienable Rights, UNLESS MADE ALIENABLE BY BARACK OBAMA, that among these are Life, Liberty EXCEPT IF FOR LIBERTY RELATED TO WEALTH, PROPERTY AND THE PRODUCT OF ONES DAYS (AND HEALTH CARE AND HEALTH INSURANCE) , and the pursuit of Happiness EXCEPT AS MAY BE LIMITED BY THE FOREGOING.

The Unreported Story of Freddie and Fannie

Tuesday, April 6th, 2010

This is from Silicon Valley Bank’s SVB Financial Group. It’s disturbing – almost as disturbing as the fact that it goes unreported. Of course, tadalafil see that fact is itself only a shadow of the horror of the reality that our country is too engaged in class warfare (i.e. blaming Wall Street) to even bother taking notice.


March Mortgage Madness
By Jim Anderson, doctor Silicon Valley Bank

When asked at a recent economic summit at Stanford if the administration would begin to tackle the problem of mortgage behemoths Fannie Mae and Freddie Mac, Director of the Obama Administration’s National Economic Council Larry Summers explained that, “(T)hese are not profit making entities.” He went on to say that any effort to make significant changes in the next few years would be “highly problematic” for the housing market and the economy in general.

Recall that Fannie and Freddie were the original source of the sub-prime mortgage concept that evolved into the global financial conflagration. Today they own or guarantee $5.3 trillion or about 50 percent of all the existing mortgages in the U.S. More importantly, about 90 percent of all mortgage originations in the U.S. will pass into the hands of these two companies. They remain the largest recipients of bailout cash — the limit of $400 billion in taxpayer support that was committed when they went into conservatorship in September 2008 was lifted last year by Treasury Secretary Geithner.

Part of the problem in the housing market today is that the only source of financing are these two congressional creations and they are in deep financial trouble. Mismanaged for years, with any meaningful oversight effectively blocked by the House Financial Services Committee currently chaired by Barney Frank, today they carry the extreme profiles of risk-taking excess that has so often been laid at the feet of Wall Street firms. Freddie Mac has total assets of $841 billion with shareholders equity of $4.4 billion. That is leverage of 191 times — a level that Lehman’s outcast CEO, Dick Fuld, could only dream about. Fannie Mae is even better. They have total assets of $869 billion and a negative net worth of $15 billion. To capitalize these two properly would require an additional infusion of $216 billion from taxpayers.

So how does all this play out in the real world? I know of one unfortunate couple that is trying to refinance their first mortgage. The loan-to-value is about 39 percent. The credit scores of the joint mortgagees are both above 800. The total mortgage amount is less than twice their combined annual income exclusive of bonuses. They have liquid assets sufficient to pay off the entire mortgage tomorrow and they have no other indebtedness. They dutifully filled out a detailed application at Bank of America in January. What followed was a blizzard of 46 emails requesting additional documentation and proof of everything on the application. After 90 days and delivering over 100 pages of background material, the couple asked in frustration, “Who needs all this information?” BofA’s equally frustrated representative explained that it intends to sell the mortgage once it is closed and that the investor needed all the details. The obvious next question was, “Who is the investor?” Answer: Fannie Mae.

So how does their experience dovetail with the constant stream of headlines about mortgage activity? Here is a sample from the last week or so:

Mortgage Assistance for Unemployed Announced: The Obama administration today announced new measures to provide mortgage assistance for unemployed homeowners and encourage lenders to reduce principal on “underwater” mortgages when modifying loans for at-risk borrowers. —

Bank of America to Write Off Principal on Some Mortgages: Bank of America (BofA) will forgive up to 30 percent of the balance owed on certain at-risk mortgages as part of its loan modification efforts to assist homeowners in avoiding foreclosure. —

Chase Agrees to Modify Second Liens: JP Morgan Chase has become the third major lender to announce it will modify second-lien mortgages under the Obama Administration’s Home Affordable Modification Program (HAMP) —

Half of U.S. Home Loan Modifications Default Again: More than half of U.S. borrowers who received loan modifications on delinquent mortgages defaulted again after nine months, according to a federal report. — Bloomberg

FBI Storms Loan Modification Company: State and federal agents raided the largest loan modification company in Arizona on Thursday. — Loan Modification News

[NOTE: Paragraph deleted.]

We find it disturbing that with all the calls for new, more politically-oriented oversight of the financial services industry, Congress has failed to address their own handiwork. Of the entire federal bailout program, Fannie and Freddie dwarf the combined total cost for the rest of the economy. According to CBO numbers, AIG is expected to have a final net cost of $9 billion, and the whole banking sector less than $30 billion. The other main components of the $99 billion in estimated principal losses from the $700 billion TARP program are $20 billion for mortgage modifications and $48 billion to bailout the United Auto Workers union through the good auspices of General Motors, Chrysler and their suppliers.

This brings up two core questions: Is there a private mortgage market in the U.S? And do we need one? The answer to the first query, as we have demonstrated, is no. The mortgage market in the U.S. is currently controlled by Congress and the Obama Administration. We think the answer to the second is a resounding yes. Until Fannie and Freddie get wound down, we will not have rational pricing or rational origination in mortgages.

Today there is no relationship between risk and return. The best, most concessionary terms go to the highest risks. Private investors will never be attracted to that profile, except with taxpayer guarantees which one day will reach a limit. Private mortgage originators, absent those guarantees, will never be able to compete. The ultimate irony is that the burden of the housing collapse on U.S. households and the accelerating foreclosure problem that the administration constantly worries about is being exacerbated by their own feckless policies. Until those underwater assets are properly priced, sold and put to use by economically viable owners, the property market will not be on the road to recovery.

This is Sketchy

Thursday, March 4th, 2010

From the The Weekly Standard March 3rd:

“Tonight, generic viagra viagra Barack Obama will host ten House Democrats who voted against the health care bill in November at the White House; he’s obviously trying to persuade them to switch their votes to yes. One of the ten is Jim Matheson of Utah. The White House just sent out a press release announcing that today President Obama nominated Matheson’s brother Scott M. Matheson, Jr. to the United States Court of Appeals for the Tenth Circuit.”

Poll: Government is a Threat to Freedom

Monday, March 1st, 2010

Score one for CNN. In a just released poll, viagra sales unhealthy CNN reports that 56% of Americans see the government’s size and power as an immediate threat to their personal rights and freedoms.

CNN Poll


Americans have good reason to be fearful of “their” monstrous government:

  • Over 2 million federal employees excluding military and the USPS (with a significant increase under Obama)
  • $3.5 trillion dollars of spending (excluding TARP) – one fourth of GDP
  • Government takeovers of corporate behemoths AIG, advice GM, sale and Citigroup
  • Official nationalization of Fannie and Freddie, their hundreds of billions of mortgages, and the overwhelming majority of the mortgage finance industry
  • Full nationalization of the student loan market
  • Continued leftist moves to control fully 100% of Americans’ health care
  • Obama and Democrat maneuvering to cap and tax every aspect of everyday life through the politicized deceit of global warming
  • Hundreds of billions of repaid TARP funds now being utilized as a personal slush fund by Obama
  • Talk of a Federal national sales tax – a VAT in the United States of America
  • And of course, there’s the $12.6 TRILLION national debt which is 87% of GDP (and which Obama is growing by $1 TRILLION a year)
  • No plan or even current talk of attempting to remedy the doomed socialist entitlement programs – Medicare, Medicaid, and Social Security

Relative Growth of Federal Government


Even 37% of government-loving Democrats are scared. Obama’s response: Americans want $1 TRILLION of more government.

Damn the torpedoes! Full speed ahead!

Steve Wynn Blasts Obama

Thursday, February 25th, 2010

On Wynn Resorts’ Feb 25th’s earnings call, best cialis cialis CEO Steve Wynn blasted the Obama administration and Congress for anti-business policies and destructive tax policies. A professional CEO’s atypical engagement in political discourse on an earnings call speaks to the extent of the problem with the Obama-Pelosi-Reid leftist triumvirate.

Here is an excerpt of the call. It’s one of Wynn’s answers to an analyst question.

[A - Stephen Wynn]: …. Job formation and the kinds of companies that make jobs are under attack in the United States of America.

You know, generic cialis MGM aside for a moment. Last year we created almost 5,000 jobs and immediately became the target of the administration. Businesses that created jobs, let alone gaming companies that created jobs, had to be no good. I mean, it is preposterous that businesses are under attack in the United States of America. Anybody that makes over $250,000 in the form of a personal income tax return is now, by Washington definition, a rich person, when everybody who has got a college degree knows that the personal income tax rate in the United States of America is the business tax of America. Every subchapter S, every individual proprietorship and every partnership in the United States of America files tax returns as individuals, and when they do, and they show that they made 2 million or 3 million or, God forbid, 4 million, they pay the income tax rate; they deduct their working expenses, their living expenses; and then they invest in a new store, a new shop, and most of the time 25% of their profits, quote, unquote, are tied up in accounts receivable or inventory. But all of the sudden, all of those people who make over 250,000 are rich folks to be fleeced. And if that’s job formation stimulation in America, I’m Mary Poppins. And if I sound angry about it and disgusted, I am disgusted and angry at the apparent ignorance of the administration and the Congress to recognize the fact that the individual tax rate in the United States of America is, in fact, a business tax of America. And if you keep banging on that, you will destroy the incentive for job formation in the United States of America. And that’s simple truth, simple truth. And whether politicians like it or don’t like it means nothing to me. And that’s why I’m pessimistic about Las Vegas because those are our customers.

Those people out there hustling their business, and God forbid, showing that they made a million dollars as a partnership or as an individual. Yes, they’re the enemy now. They’re the rich folks. Well until we get over this, America’s in for hard times because what’s going to happen is the people that are going to suffer from what’s going on are the working class of America. My 15 or 20,000 employees, they’re the ones that are in trouble. The reason they’re in trouble is this demolition of the dollar is going to reduce the buying power of the working class of America as sure as we gave them a salary cut of 25%.

And that’s another thing that doesn’t seem to be clear to the brilliant people in Washington, D.C. They’re not just our customers, they are my employees. And until my employees get the drift of what’s being done to them, America’s in trouble. Next question.