Monthly Archives: April 2024

“So now, what’s your take on the significant discrepancy between average pay for workers and corporate CEOs?”

“So now, what’s your take on the significant discrepancy between average pay for workers and corporate CEOs?” by Peter Burrows elburropete@gmail.com 4/18/24

(Another question asked by Cousin Deb, a retired professor at Cornell University. She has a Ph.D. in Education, which she is valiantly trying to overcome. This is my emailed response.)

The CEO- average worker pay gap? Oh, that’s something I worry about all the time. I can barely sleep at night thinking about that terrible, horrible injustice.

Please. What corporations pay their CEOs and their workers are free market transactions, willingly entered into by consenting adults. Frankly, it’s none of my business and it’s none of yours.

I realize that people whose sense of cosmic justice is offended by what they consider to be “too much,” whether a pay gap, or a salary or whatever, would like to pass a few laws to “correct” these things. Send in the Government. Badges and guns. Right.

You and I can make it our business by buying a single share in the offending corporation, attend the annual meeting and propose to shareholders that we owners adjust that CEO worker average pay gap. Now if we can’t get enough shareholders to agree with us, what we can then do is gather like-minded people together and buy enough shares to simply take over the company or buy enough so we can control the board of directors.

Or maybe we can start our own company to compete against that evil corporation. Or maybe just boycott their products.

Gosh, all that would take a lot of work and might mean risking — GASP – our own money! Oh no. Pass a law. Send in the cops! Typical authoritarian impulse of the morally superior elitist, to whom I ask: “Who made you God?”

It happens across the political spectrum, depending on the issue. Too many people want to use the power of government to “do good,” e.g., some pro-lifers would jail anybody involved in an abortion, nurses to patients. Sigh.

Also, the pay gap that knots the knickers on elitist pinheads sometimes includes the result of stock options or stock sales, which can really skew the results. For example, a few years ago Elon Musk sold $3.5 billion in Tesla stock. That kind of alters the average pay gap, doesn’t it?

More typically, it’s stock options the CEO cashes in that causes lots of heavy breathing in the same crowd that has no problem with Claudine Gay getting paid $900K. Harvard is private, so I could give a rat’s ass.

I do give a rat’s ass when the president of our local WNMU is paid damn near $400k a year for a state job that I suspect could be done for much less. The government bureaucrats just take tax dollars and pay each other whatever they think they’re worth. I don’t like it but not much I can do about it but vote for people like me — or become a PhD. and cash in too! (;~)

I do have a slight problem with somebody like Elon Musk making billions upon billions when Tesla’s business, from cars to batteries, basically depends upon government mandates and tons of subsidies. He was smart enough to cash in, so I guess I can’t blame him for taking advantage of government stupidity. That stupidity IS our business!

One last thing, The people who talk about taxing the billionaires as if those billionaires did something wrong or evil, don’t seem to realize that the great preponderance of billionaires in this country support liberal causes. The Google boys, Zuckerberg, Gates, Buffett, Bezos and on and on and on.

I’d rather have a society where entrepreneurs get filthy rich, even liberal ones, than live in a society that punishes success out of some moral outrage at a perceived “inequality.” Bezos has billions of dollars in Amazon stock, the price of which is in some small part due to my business at Amazon and thank you Jeff, you liberal asshole. He didn’t steal a penny of his wealth and I have benefited greatly from his genius.

I say don’t put extra taxes on any billionaire, lib or otherwise, because that means taking money out of private hands and putting it in government hands. No thank you. The government didn’t earn that money, in spite of what Obama says.

The same goes for estate taxes, which should be zero. People who think heirs shouldn’t enjoy money that they didn’t earn are making moral judgments, playing God again. That also takes money out of the private sector and puts it in the public sector, where it’s usually wasted.

Other than that, Deb, I don’t have any opinion on the topic.

“What do you think about taxing wealthy folks?”

Leave a reply

“What do you think about taxing wealthy folks?” by Peter Burrows 4/17/24

(I was recently asked that question by my cousin Deb, who is a retired professor at Cornell University. She has a Ph.D. in Education, which she is valiantly trying to overcome. This is my emailed response.)

“What do you think about taxing wealthy folks?” Oh, my. That’s a “prod the bear question” which I’ll try to answer without it shortening my life too much.

In brief, for as long as I’ve been a reasonably informed voter, at least 55 years, the Democrats have made issues of “taxing the wealthy” and “paying their fair share,” whether it’s from individuals or corporations.

It’s all demagogic BS and the Republicans have let them get away with it. These arguments are easily refuted by a look at the facts, and only once do I remember a Republican taking a Democrat to task about it. That was in a VP debate between Lloyd Benson and Dan Quail. (Yes, I’m that old.)

As I recall, Benson said something about evil President Reagan lowering the top tax rates and Quail responding that the lower tax rates actually raised MORE money, which was true. Benson then said something very revealing, something to the effect that higher tax rates may not actually raise taxes, but they would give the APPEARANCE of fairness.

In other words, f— the facts and fool the people, or something like that. As ever, demagoguery depends upon an ignorant electorate.

As an aside, I have also heard Democrats over the years say something to the effect that there are x-number corporations who make billions in profits yet don’t pay any taxes, and isn’t that unfair? So, vote for me, etc. etc., as if though once in office the Democrat will make those scofflaw corporations pony up.

The problem is, once again, a little thing called facts. WHY don’t the corporations pay taxes? The implication is they are somehow breaking the law, when in fact the reason they don’t pay income taxes is because they didn’t earn any income!

How is that you say? The answer is slightly arcane, but not so much so that the public wouldn’t understand if properly presented to them, something the Republicans fail to do, which is inexcusable.

Corporations keep two sets of books, both of which are available for public scrutiny. Nothing secret here. One is for the IRS, the other for the shareholders, which is what is reported. What is reported are NORMALIZED earnings, i.e., what earnings would be if they weren’t affected by unusual or one-time occurrences.

The most common discrepancy between IRS earnings and normalized earnings is the use of accelerated depreciation. Corporations use accelerated depreciation when reporting to the IRS and straight-line depreciation when reporting to shareholders.

As an example, a company buys a delivery truck for $100,000 which has an estimated life of 10 years. The normalized depreciation expense would be $10,000 per year, but accelerated depreciation might allow the company to expense $50,000 in the first year.

(The same amount of depreciation expense is going to be deducted, accelerated depreciation just allows it to be deducted sooner rather than later. This saves money by lowering today’s taxes, freeing up funds that can be invested, etc.)

When capital expenditures are in the billions or hundreds of millions, you can see how the added expense from accelerated depreciation could easily wipe out earnings. If the company then reported a net loss to shareholders, this could give a misleading picture about how the company’s business is doing.

That’s why companies report “normalized” earnings, something I’ve long thought was foolish. Corporations should publicly report IRS earnings, with normalized earnings as a footnote. Investors and shareholders are sophisticated enough to figure this out, but the man in the street ISN’T, which is what the Democrats count on.

Similarly, the Democrats depend on the man in the street not knowing the difference between income tax RATES and income tax RESULTS. The top individual rate today is 37%. The top rate when Reagan took office was 70%, which was cut to 50% in 1981, and the top rate when Kennedy took office was a stratospheric 91% which was cut to 65% in 1963.

Both rate cuts resulted in tax revenue increases. What this means is that wealthy people actually paid MORE in taxes than they did before the rate cuts. An economist named Art Laffer became famous for articulating this in what is now known as The Laffer Curve, which you can check out in the Wikipedia link below.

In essence, lower tax rates can result in higher tax revenues which is the case today. In fact, according to a recent article in Reason Magazine, “the wealthiest Americans are now paying a higher share of federal taxes than at any time in the past 40 years.”

The article states that according to 2021 returns, the top 1% of earners paid nearly 46% (!!) of all income taxes, the top 10% paid 76% and the top 25% paid 89%. By contrast the bottom 50% paid only 2.3%. (See link below.)

What this means, not surprisingly, is that there is a large constituency in favor of raising taxes because they don’t pay any. What a sweet deal.

So, to answer your question, what do I think about taxing wealthy people? I think wealthy people are OVERTAXED and that the tax burden should be spread more evenly. That would mean raising the taxes on the bottom 50%. How many votes do you think I’d get running on that platform?

As to raising taxes on corporations, this reflects a basic misunderstanding of how the world works. The rate of return on investment is always calculated after taxes are paid, which means taxes are considered an expense. Expenses are paid out of revenues, aka sales, which means that it is the CUSTOMERS who pay the taxes, just as they pay all the other expenses.

Corporations only appear to pay taxes, which is good enough for the demagogues.

Interestingly, politicians tacitly acknowledge this reality when they offer lower tax rates to attract corporations. Ireland, for example, taxes companies at only 15% while Biden wants to raise rates to 28% from 21%. If you are an international company looking for a place to expand, all things being equal, you go to Ireland.

In my opinion, the corporate tax rate should be ZERO. Competition would force corporations to pass the savings on to the customer, ergo, lower prices.

Well, that’s not going to happen. No politician would ever propose zero taxes on corporations, let alone propose raising taxes on the bottom 50% of wage earners. Maybe if we had term limits we could expect some statesmanship from those we elect, which is one reason to have a Constitutional Convention, but that’s another issue.

Now, aren’t you glad you asked?

https://en.wikipedia.org/wiki/Laffer_curve

(The link to Reason Magazine that WordPress can’t open is to an article published April 12 by Eric Boehm, “The Real Tax Gap.” It shouldn’t be too hard to find.)

The Real Tax Gap

FYI, here is JFK’s Message to Congress, 1/24/1963, proposing lower taxes. If you didn’t know, you’d think he was a Republican!

https://www.presidency.ucsb.edu/documents/special-message-the-congress-tax-reduction-and-reform

“Is a Preemptive Strike in the Offing?”

Leave a reply

“Is a Preemptive Strike in the Offing?” by Peter Burrows 4/12/24 elburropete@gmail,com

This is a very important read. When Obama said Iran wouldn’t use nuclear weapons because it would be against their religion, he was 180° wrong. Here’s a link to the article:

https://pjmedia.com/david-solway-2/2024/04/11/is-a-preemptive-strike-in-the-offing-n4928096

I’m glad to see that an MSM writer with a following has spelled out this apocalyptic Shia doctrine. Maybe somebody will inform Trump, who’s as clueless as Old Joe. From the article:

” Shi’ites believe that Allah’s kingdom will be established on earth by the Twelfth or Hidden Imam, whose “second coming” can be accelerated by creating the right set of circumstances, namely, the fomenting of violent upheavals in a holocaust of blood and fire among the nations of the earth — in particular, Israel. And the mullahs are just crazy enough to bring such a cataclysm to pass.”

I wrote about this many years ago in “Monsters from the Id” which uses the old sci-fi movie, Forbidden Planet, as metaphor for our times. The conclusion is still relevant, more than ever:

“The Iranians say they are not trying to build nuclear weapons, and even if true for now, their long range intentions are very suspect. They’ve been waiting for the Mahdi for over 11 centuries. A few more years, or decades, to gather the means to start the final confrontation with the Satanic West is of little import.

“The number one question: Are they really planning to start a nuclear holocaust as a religious imperative? If so, preemptive war, not Neville Chamberlain, is the only rational course of action..

“Question number two, maybe it’s really number one: Do we have the moral courage for such a course of action?”

https://wordpress.com/post/silvercityburro.com/137

The “one issue” voter problem

Leave a reply

The “one issue” voter problem By Peter Burrows elburropete@gmail.com 4/9/24

Churchill once famously said, “The best argument against democracy is a five-minute conversation with the average voter.” These days, I don’t think it would take that long. I would bet a Don Juan burrito that the average voter can’t name their two senators or who represents them in the House of Representatives, let alone any details about budgets, foreign policy, etc., etc. ad infinitum.

In defense of the average voter, in a world with so many complex issues, we can’t expect voters to be well-informed about all of them and, in fact, many voters simply don’t have the time or the interest to become well-informed on ANY issue. They look at only one thing when it comes to who they vote for: party affiliation.

Given the bias of the media today, this gives the Democrats a huge advantage. It’s hard to imagine, for example, any Democrat president today getting an approval rating as low as the 22% given to Harry Truman who, in hindsight, was a pretty good President. That’s lower than the 24% approval for Richard Nixon in a poll taken just before he resigned in disgrace.(1)

Truman’s readings may have reflected a media bias that was pro Republican back then. Today’s media bias is very much the opposite and probably accounts for President Biden’s approval rating of 40%, which is ridiculously high for an obviously incompetent, senile octogenarian. If you suspect this rating hides a huge division of opinion based upon party, go to the head of the class. Sure enough, the Democrats give Biden a — get this — 77% approval rating (!!) vs. the Republicans giving him only 7%. (2)

As for Trump, his recent ratings were 52.5% unfavorable vs. 42.6% favorable.(3) Once again, this reflects a huge division based on party, and while I couldn’t find any current polls, one from last July shows Republican approval for Trump at 66%, and Democrat disapproval a whopping 91%! (4)

Never in my lifetime has there been such a huge, and heated, division. To say that Trump elicits an emotional reaction from voters is very much an understatement. Emotions trump facts, no pun intended, and what this means is that Trump is THE issue in this election:

A new Economist/YouGov poll’s findings revealed precisely what the 2024 election will be about. The survey showed that regardless of which side one is on, this race is all about Trump.(5)

People voting their emotions can destroy democracies, which have a history of putting charismatic demagogues in power who then become dictators. Hitler, Mussolini, Hugo Chavez, Juan Peron and Robet Mugabe come readily to mind. That’s why our Founding Fathers created a Constitutional Republic, sometimes called a representative democracy, in which the people elect representatives to govern.

This puts a buffer between the “madness of the crowds” and those passing laws. The Founding Fathers wisely thought this wasn’t enough of a buffer to protect us from democracy — yes, PROTECT us from democracy — so they created a bicameral government in which one of the legislative bodies was not directly elected by the people: the Senate.

Few people know this, but Senators used to be appointed by their state legislators, which meant that the Senate was only very indirectly elected by the people, i.e., was one more step removed from the madding crowds. This ended with the 17th Amendment, enacted in 1912 and effective for the 1914 election which was the first that saw senators elected directly by popular vote.

My impression of the times is that the state legislatures were only too happy to let Senators be chosen by popular vote. Selecting Senators was one hell of a lot of work for the state legislators. Why not just let the people decide? More democracy! Sounds good, doesn’t it? Not in hindsight.

What this means is that the Senate today is composed of 100 people who, politically, are no different from their cohorts in the House of Representatives. Members of both houses are politicians, people who appeal to the general populace for votes and usually have as their number one priority getting reelected.

Elections are expensive. Candidates often complain about the time they spend raising money, and this includes those people who are already in office. Senators, who originally only worried about lobbying their state legislatures, if that, now have to spend time raising money, kissing ass and placating special interests, just like their cohorts in the House of Representatives.

Thus, the Senate is no longer much of a check on the emotions that might run rampant in the House, since they are also swayed by those same emotions. And that’s why this election is so dangerous. The 91 percent disapproval rating of Donald Trump from their constituents is something the Democrats in the Senate and House are very aware of.

Furthermore, this is a STRONG disapproval. If some of the news announcers and talk show hosts in the MSM, especially on CNN and MSNBC, are any indication, some of the opposition to Trump is positively hysterical. I’m afraid Keith Olbermann’s thinly veiled sincere hope for Trump’s assassination is not an outlier. (6)

Even if Trump can overcome swing-state voter fraud and actually win, we can expect a repeat of the “mostly peaceful” riots of 2020 led by the same Antifa/BLM masked thugs, except this time on a much larger, more intense scale. It would not surprise me if President Biden would then declare martial law. It also wouldn’t surprise me if the Democrats and RINO Never-Trumpers in Congress vote to overturn the election results to “save Democracy.”

I hope I’m wrong. It’s ridiculous that this election is about Trump, who is a loud-mouthed New York asshole, NOT a threat to “democracy” or a dictator in waiting. Robert F Kennedy Jr. was quite correct to point out to an interviewer that Biden is a ‘much worse threat to democracy’ than Trump.(7) RFK, Jr. has also said voters deserve better than the ‘least of two evils’(8), something I thoroughly agree with. The problem is, with RFK, Jr. in the race, it would be the least of THREE evils.

As impossible as it may be for some people to believe, there are a number of issues which are far more important than the specter of Donald Trump as president, issues I think Trump can deal with far better than Biden. The Biden Administration’s complicity in the illegal immigrant invasion is number one on my list because it is an open violation of the Constitution, Article IV section 4:

“The United States shall guarantee to every state in the union a Republican form of Government, and shall protect each of them against Invasion;”

A Trump administration will stop the invasion and MAYBE prosecute those responsible. Maybe. “Maybe” is better than nothing. So, while Trump is a long way from being my first choice, my first choice isn’t on the ballot. I can only choose the “least of two evils” and compared to Biden, Trump is Mother Teresa.

(1) https://news.gallup.com/poll/116677/presidential-approval-ratings-gallup-historical-statistics-trends.aspx

(2) https://www.reuters.com/graphics/USA-BIDEN/POLL/nmopagnqapa/

(3) https://projects.fivethirtyeight.com/polls/favorability/donald-trump/ 

(4) https://www.pewresearch.org/short-reads/2023/07/21/little-change-in-americans-views-of-trump-over-the-past-year/ 

(5) https://redstate.com/jeffc/2024/04/03/new-survey-shows-exactly-what-the-2024-election-will-be-about-n2172287

(6) https://www.foxnews.com/media/keith-olbermann-suggests-hope-trumps-assassination-x-post

(7) https://www.theguardian.com/us-news/2024/apr/02/robert-f-kennedy-jr-cnn-interview-biden-trump

(8) https://www.audacy.com/wwjnewsradio/news/national/rfk-says-americans-deserve-better-than-the-least-of-2-evils 