First are the facts. The economy grew during President Bush. The average wage increased for Americans $400 to $500 dollars, that’s on top of the $2000 it grew under President Clinton. And the Federal Government increased revenues by 20% under President Bush. Spending by President Bush has been outrageous though, and wasteful.
Now if you want to see what I think of the increases on the corporate tax structure just check out my previous post [Democratic tax plans: a look from reality]
A more realistic view is location 11%, Energy 4%, Advertising 1.2%, Raw Goods 3.2%, Communication 4.2%, Operation 2.35%, Outsourcing 2.2%, Employees 32%, Tax 34% - which nets 94.15% of Revenue. Increase cost of higher taxes means that the 6% profit becomes 11.5% in debt.
Senator Obama clearly states that he will be increasing taxes on investments to at least 25%, which is massive. It means that to make a decent return on an investment – say the historical 11% that most mutual funds have made per year – you in fact have to make a 36% profit to get the return, which most stocks never make unless you are in the middle of the internet bubble. That is a fact I can attest to from my experience as a successful stock broker.
So to make attactive profits for inestors, companies will be forced to make changes. As I have stated in the abovementioned post, that means that since virtually all costs are fixed except employees they will absorb the hit as will consumers.
Also note that Senator Obama restates a previously stated comment. He states that 95% of Americans will benefit from his tax plan. That is a lie. He has clearly and repeatedly stated that 95% of American that RECEIVE A PAYCHECK will benefit from his tax plan. Business owners are not included in his savings, no matter the size of their business.
Bill O’Reilly also failed to mention that Senator Obama, along with his Vice President, already voted to effectively increase the taxes of all Americans making $31,850 or more this year. That’s a 3% tax increase on roughly 95% of Americans.
Now in a quick statement Senator Obama mentioned China
“…[the debt has] gone up $4 trillion dollars, that a credit card we’re taking out on our kids from the bank of China, that they’re goning to have to pay back…”
While I too have no love of foreign investment levels that currently exist I have a problem with what is being implied. Does Senator Obama plan to limit who can invest in American companies and banks? Because in a free economy you can’t stop anyone from investing.
In addition, I am unaware of English, French, or German companies, individuals, or nations stepping up and offering to make the investments in America that the Chinese and Saudi Arabians has offered. So if we are to have these investments and no friendly countries are offering anything, what are we to do?
The counter position – which is never being mentioned – means that we refuse the investments of these nations, or limit them. That also means that several of our banks, this year, would have been short on average $5 billion each at least. That means that at least 2 major money center banks would have failed this year. Without that foreign money the economy would have crashed as the dollar got crushed and inflation flew thru the roof because banks would have caused a domino effect that would easily have plunged the nation into a depression.
I have yet to hear an answer that addresses the problems the counter position creates. Perhaps it’s because there is no answer, or they realize that most Americans are unfamiliar with stock market intricacies to ask this question. But I do.
So does this mean that Senator Obama would rather have CitiGroup, and Lehman, and other banks/brokerages fail than accept the billions of dollars foreign investors offer – even is only certain countries are willing to give us the money and none of them are close friends? Is Senator Obama saying that he is willing to plunge America into a Depression that will obviously not help retirees, workers, the economy, and ultimately the world?
Tonight is part 3. Bill Ayers, Rev. Wright, and other questions on character that are sure to be the high point of the interview.
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