So, as I woke up this morning I began scheming for a way to end the dramatic wealth disparities that have been created in our society. In case anyone is ever curious it began with an end to stock ownership and capped executive/maximum salary & benefits, maybe to $1M, maybe something slightly higher. Anyway, the idea was that if the company had to run more like a non-profit, not holding on to cash to benefit shareholders, only to grow the company itself, and it would also be forced to pay higher salaries to employees, then in very little time the gap would be closed. Then I realized the problem.
Salaries for the working class can't grow by leaps and bounds. If they did then it would just lead to the type of inflation that would knock down that same purchasing power. If everyone had a bunch of cash then our demand would be high, supply would be low, and prices would have to increase. By allowing the few to control the wealth, as long as the few continue to allow wages to grow at a pace that matches inflation then the pricing structure all holds together. What strikes me then as still the most effective means of limiting the excess accumulation of wealth in our society is adding a few more steps to the income tax pyramid, raising the maximum rate higher than the 35% we're currently at, and giving that excess which we can't give to the employees for fear of causing inflation into the hands of the government. I really didn't think that's where I was going to get when I started thinking about reforming the system this morning but there it is.
Thursday, January 15, 2009
Wednesday, January 14, 2009
Stupid Lobbyists
As a tax professional, one of the things that irks me the most is the effectiveness with which lobbying groups have managed to inseminate their viewpoints, which only benefit a small minority of people, into the public sphere. Much has been written but it seems that nobody can educate the public or has the resources to fight the disinformation being provided by lobbyists who wish to end the estate tax, even though it only affects the rich. Part of my job includes estate tax planning and I already know that my clients can effectively plan around most of the estate tax burdens as they are, but they should still be in place, and possibly be more restrictive so that we don't continue to have the family wealth monopolies that control our current landscape.
From the U.S. Chamber of Commerce web-site:
The U.S. Chamber is opposing a proposal by the incoming administration and Congress to retain the estate tax, also known as the death tax, instead of allowing it to expire as scheduled in 2010.
“If Washington’s incoming leadership really wants to jumpstart the economy and create jobs, they can start by sending the death tax to the grave once and for all,” says Chamber Executive Vice President for Government Affairs Bruce Josten. “We should not be burdening hard working Americans with this serious, home-grown threat when they face enough competition from emerging markets abroad.”
100% BS. There will be no jobs created because of a repeal of the estate tax. There will just be wealthy families able to pass their fortunes on to their children easily and forever. Want some more BS? How about this statement from a lobbyist hired by the Waltons (Wal-Mart fortune and America's wealthiest family):
Aubrey Rothrock III, a Washington lobbyist hired by the family, says the Waltons are mostly interested in bills to increase charitable giving through their family foundation. "The estate tax repeal initiative has never been the focus of our advocacy efforts," he says.
I would hope that even a layman would find it hard to believe that the Waltons are interested in bills to increase charitable giving through their family foundations. What exactly is stopping them from giving everything to charity? I'm not aware of a single limitation to the charitable deduction and in fact you could give your entire fortune to a foundation or to charities directly and pay NO ESTATE TAX. Each of the children were given their share of the company before its growth, so Sam did some pretty good estate planning their. When the wife of Sam Walton died she gave her wealth to the Walton Family Foundation (like I said, no estate tax, nothing to the government). The funny thing is that Walton Family Foundation paid compensation of 1.3M to Walton Enterprises LLC in 2006 for management of the Foundation so even some of that money just gets plowed back into the family. It's all a remarkable fleecing and I wish that better information could get around than what most people hear.
Tuesday, January 13, 2009
A thought on Social Security
First, from the New England Journal of Medicine (props to google for finding me such a reputable sounding source):
"Although the Social Security Administration recently raised its estimates of how long Americans are going to live in the 21st century, current trends in obesity in the United States suggest that these estimates may not be accurate. From our analysis of the effect of obesity on longevity, weconclude that the steady rise in life expectancy during the past two centuries may soon come to an end."
This was essentially my thought in a nutshell, corroborated by the NEJoM. Social Security is supposed to run out because our life expectancy has grown, and we're even told by the SSA that they are raising the life expectancy estimates, I have to wonder how valid those estimates are given the growing trend of overweight/obese Americans. How could life expectancy not go down when the percentage of overweight and obese Americans went from 33.1% and 22.9% from '88-94 to a current 34.1% and 32.2% respectively? Someone would have to be lying because the % increase is certainly statistically significant so are the health concerns overblown or is the SSA afraid to say that our life expectancy is actually going down? I'd have to guess the latter because I haven't seen any medical advancements that seem to really be prolonging lifespans in recent years the way heart surgery and cancer treatments prolonged the lives of the baby boomers.
So maybe there is hope for Social Security after all!
(edit: sweet moving map! http://www.cdc.gov/nccdphp/dnpa/obesity/trend/maps/index.htm )
"Although the Social Security Administration recently raised its estimates of how long Americans are going to live in the 21st century, current trends in obesity in the United States suggest that these estimates may not be accurate. From our analysis of the effect of obesity on longevity, weconclude that the steady rise in life expectancy during the past two centuries may soon come to an end."
This was essentially my thought in a nutshell, corroborated by the NEJoM. Social Security is supposed to run out because our life expectancy has grown, and we're even told by the SSA that they are raising the life expectancy estimates, I have to wonder how valid those estimates are given the growing trend of overweight/obese Americans. How could life expectancy not go down when the percentage of overweight and obese Americans went from 33.1% and 22.9% from '88-94 to a current 34.1% and 32.2% respectively? Someone would have to be lying because the % increase is certainly statistically significant so are the health concerns overblown or is the SSA afraid to say that our life expectancy is actually going down? I'd have to guess the latter because I haven't seen any medical advancements that seem to really be prolonging lifespans in recent years the way heart surgery and cancer treatments prolonged the lives of the baby boomers.
So maybe there is hope for Social Security after all!
(edit: sweet moving map! http://www.cdc.gov/nccdphp/dnpa/obesity/trend/maps/index.htm )
Monday, January 12, 2009
Security
It worries me that on so many occasions when I've been faced with a password protected client file I can make a few guesses and figure out the password. At least a little creative personalization would be a nice sign. I'm talking admin and password working most of the time, or the password is the same as the user name or the first name is the user name and the last name is the password. All too easy (bonus: Mortal Kombat reference).
More stuff of the future that should be now!
Voice activated homes!
I'm pretty sure it would require some intricate system to actually be pulled off but all the technology is there and people could have this right now. A computer running a home network, a voice recognition system, connect the lights, connect the electronics, and bam, a sweet voice activated home of the future.
I'm going to go one step further and patent some scripted automation shortcuts where if I'm walking to the bathroom and I say "Bathroom" or something authoritative then I want the hallways, etc. lit up leading me to the bathroom and then turning off once I've made my way. And here's the thing, I don't want some goofy system where I have to say "Volume Up" to change the volume on my TV, but if I say activate the DVD command, the TV and DVD player should both turn on, and the TV should switch to the DVD input automatically.
If I ever get a chance at some point in my life to build my own home from scratch, you better believe it's going to have some serious networking capability so I can pull this off!
I'm pretty sure it would require some intricate system to actually be pulled off but all the technology is there and people could have this right now. A computer running a home network, a voice recognition system, connect the lights, connect the electronics, and bam, a sweet voice activated home of the future.
I'm going to go one step further and patent some scripted automation shortcuts where if I'm walking to the bathroom and I say "Bathroom" or something authoritative then I want the hallways, etc. lit up leading me to the bathroom and then turning off once I've made my way. And here's the thing, I don't want some goofy system where I have to say "Volume Up" to change the volume on my TV, but if I say activate the DVD command, the TV and DVD player should both turn on, and the TV should switch to the DVD input automatically.
If I ever get a chance at some point in my life to build my own home from scratch, you better believe it's going to have some serious networking capability so I can pull this off!
Friday, January 09, 2009
Video Phones
Shouldn't we all have video phones by now? Did cell phones somehow screw this up? Webcams are cheap, everyone has high speed internet, voip is free, so why don't we all have a home video phone in our living room yet?
Unemployment is... Wow
From MSNBC: "11.1 million people were unemployed in December."
I was literally chatting with someone online when they saw a co-worker get the axe and then shortly thereafter were laid off themselves. It really is a crazy, stressful time, even for the ones that aren't directly living the hardship.
It's almost enough to call into question our bizarre interconnected economic world. Maybe if way back when we never had opened up to the idea of allowing cheap exports to turn us into a nation of consumers then we would still have a production capacity, even if it was at the cost of higher priced goods. And since the goods were priced higher we wouldn't have so much nor expect to have so many material goods. And if our banks never could have sold bundled securities with fake risk grades to outside investors then the race to create these mortgages in the first place would never have occurred. If every person selling a mortgage was still holding that obligation, and every dollar that we spent on a product went into the pocket of another American, could this whole thing have still got as blown out of proportion as it did?
I tend to think that it wouldn't have. I also believe that this would have dramatically slowed down the speed of growth over the years but it all calls into question whether we NEED to grow at this speed in the first place, or if we have created this expectation for ourselves that even we could not live up to in the end. And yet still there are people saying that this entire recession is just a hiccup on the way to getting right back on the same tracks. I want efficiency in general, but what we have lacked for too long is accountability. I feel bad for those being caught in the back draft of the accountability we are currently facing, but at the same time I feel like nobody is really living up to all the reasons that we should be held accountable for our actions and we're letting ourselves off the hook a little too easily. That's what's really messed up about this world.
I was literally chatting with someone online when they saw a co-worker get the axe and then shortly thereafter were laid off themselves. It really is a crazy, stressful time, even for the ones that aren't directly living the hardship.
It's almost enough to call into question our bizarre interconnected economic world. Maybe if way back when we never had opened up to the idea of allowing cheap exports to turn us into a nation of consumers then we would still have a production capacity, even if it was at the cost of higher priced goods. And since the goods were priced higher we wouldn't have so much nor expect to have so many material goods. And if our banks never could have sold bundled securities with fake risk grades to outside investors then the race to create these mortgages in the first place would never have occurred. If every person selling a mortgage was still holding that obligation, and every dollar that we spent on a product went into the pocket of another American, could this whole thing have still got as blown out of proportion as it did?
I tend to think that it wouldn't have. I also believe that this would have dramatically slowed down the speed of growth over the years but it all calls into question whether we NEED to grow at this speed in the first place, or if we have created this expectation for ourselves that even we could not live up to in the end. And yet still there are people saying that this entire recession is just a hiccup on the way to getting right back on the same tracks. I want efficiency in general, but what we have lacked for too long is accountability. I feel bad for those being caught in the back draft of the accountability we are currently facing, but at the same time I feel like nobody is really living up to all the reasons that we should be held accountable for our actions and we're letting ourselves off the hook a little too easily. That's what's really messed up about this world.
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