Corporate Profits Are Everybody's Punching Bag - I Say ABOLISH THEM

Nothing quite stirs up a debate like corporate profits.  In America the debate is especially ferocious because the left considers corporate profits their money and they truly believe that if they could only seize all those evil profits that they could make the world a perfect place.   Corporations who protect their profits from taxation are routinely vilified.

Reports: US 'Corporate Tax Dodgers' Keeping More Money Overseas Common Dreams

'Why should ordinary taxpayers have to sacrifice while highly profitable corporations are using accounting acrobatics and tax havens to avoid paying their fair share?'

At a time of record corporate profits, U.S. "corporate tax dodgers" are parking more of their profits offshore, taking advantage of tax loopholes to shield billions from U.S. taxes, according to new analyses in the Wall Street Journal and Bloomberg.

The WSJ looked at 60 U.S. companies that parked a combined $166 billion offshore last year, allowing 40% of their annual profits to escape U.S. taxes. In Bloomberg's analysis of 83 companies, there was a $183 billion expansion over the past year in non-U.S. holdings, for a combined total across the 83 companies of $1.46 trillion in offshore profits.

The trend is clear: figures from both papers show an increase from last year in offshore profits — up 15% using WSJ figures and a 14.4% increase using Bloomberg's data.

That's clearly a scathing indictment of corporate profits. The business friendly website Zero Hedge also chirped in on the issue.

Which 'Patriotic' US Companies 'Invested' The Most Cash Overseas Last Year?

Over the years and decades Congress has passed numerous laws that encourage and reward American corporations who offshore, relocate to foreign shores and cease investing and producing in the US.   Effectively, Congress has made it very profitable for corporations to fire US workers and just pack up and leave.  It has been estimated that $2 trillion in corporate profits are now sitting offshore.

$2 Trillion in Corporate Profits Perched Overseas

In a small effort to help assist during Admin’s sporadic posting week, I thought I would revisit the issue of US corporate taxes, and the resultant $2 trillion in profits that are sitting overseas, and which are unlikely to be brought into the US anytime soon due to the corporate tax rates in effect. Please forgive any typos as I am typing this directly into WordPress.

I just read today that Admin’s second most favorite company (sitting squarely behind IKEA in the number one spot), GE, has $108 billion in profits sitting overseas, which is being used to invest in overseas projects. Overall, there is believed to be around $2 trillion total in profits that foreign arms of US companies have made that are not being transferred to parent companies in the US owing to the corporate tax rate of 35%, which is, of course, the world’s highest. Those transfers will not be made, as it would be irrational for a company to do so.

Everyone knows that corporations pay little or no tax on their US profits, for a great many reasons – tax breaks, R+D credits, etc etc etc. Total corporate tax take is around $300 billion a year. However, any overseas profits brought back on shore would be hit with the full corporate tax rate, as the various rorts have already been used to minimize the tax on onshore profits. If the full $2 trillion were to be repatriated, it would mean an approximate tax bill of some $700 billion dollars. That is not going to happen, as the companies would rather be investing the $700 billion rather than just giving it away to the IRS. Further, if the money were repatriated, and the $1.3 trillion left after the tax take was invested in the US, the income on the money would be subject to the draconian 35% tax rate – as I have said, which is the highest in the world (at least the developed world). So the long and the short of it is, corporations are way ahead of the game if they do not bring the money home. Even very modest returns on their $2 trillion investment means the corporations are generating billions in income more than if they were to bring the money into the US.

A further issue is that transfer pricing is being rorted mightily. Companies are doing all possible to make sure their overseas arms post a profit, and for their US entities to not post a profit. The best way to do this is to ensure that the overseas entities sell goods to their US entities at inflated prices, thus maximizing overseas profits and minimizing US profits. And vice versa. There is huge incentive to do this, and it is being done on a very large scale, despite attempts to keep it from happening.

An interesting fact is that around $1.5 trillion of the overseas profits are actually held in US banks. The overseas entities send their profits to US banks to hold, and it is not deemed to be returned to the US. It is simply a foreign entity having accounts in the US. The main reason it is done is to protect the parent corporation from swings in the exchange rate of the US dollar. So rather than holding the profits in ringits or baht or whatever, the foreign arms open a US bank account and deposit the foreign earnings into JP Morgan, US treasuries, or whatever.

So, to summarize, the curent tax system 1) gives corporations incentive to leave foreign profits overseas, and not bring the profits back to the US, and 2) gives incentives to artificially minimize US profits by transferring the profits to the overseas arms of the US corporations so as to minimize US tax. It takes a particular kind of stupid to come up with a system that achieves exactly the opposite of what it should.

I understand that this can be a very complex issue, but the current system is promoting the flow of capital out of the US into countries that the US is competing against in a world-wide marketplace. It seems to me that the tax rate should reflect the global market, and a corporate tax rate of around 15 to 20% would eliminate the incentive which exists to 1) minimize US earnings in favor of foreign earnings, and 2) hold profits overseas. It would result in a significant increase in US capital expenditure, which would make the US more internationally competitive, and would create high-end, good paying jobs, and would make direct competitor nations less competitive at the same time, starving them of capital and profits.

If the above words are not a solid justification to reduce corporate taxes and repatriate US corporate profits back to the US to promote capital investment and economic growth, I don't know what is.

If Americas are wondering why our economy is in shambles and high paying jobs have disappeared, they have no further to look than the corporate tax system.  America has the highest corporate tax rate on the planet and even if nobody is paying it because of offshore tax loopholes, there are ZERO incentives for corporations to repatriate that big pile of money back to the US.

For starters, liberals are lusting to steal that big pile of money and other perverse incentives besides taxation such as healthcare costs and draconian regulatory costs function as severe impediments to jump starting our economy.

Every year the Competitive Enterprise Institute publishes a study on the cost of regulation.

Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State

• Estimated regulatory costs, while "off budget," are equivalent to over 48% the level of federal spending itself.  

That's a pretty gosh darn mind-boggling figure in regulatory compliance costs.  Add $1.750 trillion in regulatory compliance costs to the US corporate tax structure and it's clearly evident that America is not a friendly place to park capital and invest.  In fact, America does just about everything humanly possible to chase capital, business and jobs offshore and as far away from America as possible.

Just imagine the economic benefits of repatriating $2 trillion in corporate profits 'tax free' back to America.  Just imagine substantially reducing the prohibitively costly nightmare of a regulatory compliance state.

America would become a friendly place to park capital, make investments and hire folks.

But in America, sanity and what is good for the prosperity of the people is verboten.  The Democrats would freak out because they would deprived of their primary pleasure, namely tossing a few measly crumbs to those they deliberately impoverished.  For the Democrats, the people are nothing more than dependent zoo animals that they pet on election day and feed at will.  The Republicans really aren't any different and their goal is feeding the military industrial complex and the perpetual war machine.

Yet, a quick tweak of the tax laws on the issue of repatriation of corporate profits and a tweak of the regulatory compliance monster could dramatically reboot our economy and restore prosperity.

Meanwhile, the politicos have decided that the poor should remain poor, that the American middle class must be wiped out whatever the cost and that blasting America back to the Stone Age is a desirable and achievable goal.  Well, maybe not quite the Stone Age but Uncle Sam's Plantation truly reeks of feudalism and the days of masters salivating as overlords of their pathetic, compliant and obedient serfs.

Can Sista Sarah the Caribou Barbi Revive the Tea Party and Smack the Republican Establishment?

As liberty activists and Paulites ponder Rand Paul and the implications of his now infamous senate filibuster, the future of liberty could very well depend on Sarah Palin.  Liberty activists and Paulites don't especially trust or respect Rand Paul but Rand did score some very significant points last week and he scored them across the political spectrum by garnering kudos from well respected liberal civil liberty activists like Glenn Greenwald.

Like it or not, Sarah Palin got behind Rand Paul early in the Kentucky primary, praised him, endorsed him, campaigned for him and raised money for him.  There can be no doubt that Rand Paul would not be sitting in the US Senate today had it not been for Sarah Palin.  What is so magical about Palin?  Very few folks are trusted or deemed credible when it comes to the rambling wasteland known as the convoluted conservative base.  Clearly, Ron Paul had a lock on the liberty factions within the GOP.  However, nobody is more trusted and respected than Sarah Palin when it comes to the grassroots religious right Republican neocons.  She draws HUGE crowds when she speaks and she's simply adored, loved and trusted on a level that few have achieved.

I'm not sure what motivated Palin to get behind Rand Paul and help get him elected to the US Senate.  In fact, Palin even praised Rand's famous father, Ron Paul, on Fox News in January 2012.

Sarah Palin Defends Ron Paul: He’s The Only One ‘Doing Something About Reining In Gov’t Growth’

Last night, former Alaska governor Sarah Palin spoke with Fox Business Network’s John Stossel about how GOP presidential hopeful Ron Paul “hit the nail on the head” when he warned Barack Obama to be careful when interjecting us in other countries’ business.

Palin did note that, for all that she supports Paul on, his almost “isolationist” stance on international relations gives her pause. That said, on the domestic front, “he’s the only one who’s been so adamantly passionate about doing something about the suffocating debt, about doing something about reining in government growth and actually slashing budgets.”

Palin has also earned the label 'The Queen of Neocon' and her support of a muscular interventionist foreign policy is well known.   A Youtube video of the Evangelical Sarah Palin saying in church that the Iraq War is God's plan has gone viral on the Internet.

Has Palin changed her neocon stripes or is she just another shameless fraud attempting to capitalize on the ever increasing anti-war sentiments within the GOP? Well, the answer is yes to both.  If anything, Palin is an astute political weatherman who knows which way the political winds are blowing and and she loves keeping herself out in front as a player.  Before she became mayor of Wasilla, the governor of Alaska and ultimately the Thrilla from Wasilla as McCain's feisty running mate, Palin and her hubby had been involved in an Alaska secessionist movement because they opposed Fedzilla, who owns or controls nearly all the land in Alaska, making all the decision on Alaska land use, especially the oil and gas resource rich lands.  Palin is a tenacious fighter with a long history of enjoying a political fight.  As one who spent most of her life as an ordinary person devoid of power and money, Palin personifies rugged individualism.

When she signed on as McCain's running mate, she wasn't ready or sufficiently savvy to deal with the mostly nasty media blitz that immediately descended upon her.  She fumbled badly.  What I admire about Palin is that through it all she managed to stay Sarah Palin and absolutely nobody could mold her into their vision of what Sarah Palin ought to be.

However, there is a dark downside to Sarah Palin, namely that she so craves power and celebrity that she will haphazardly mine the opportunities wherever they are so long as they advance her quest for fame and fortune.  Moreover, Palin does indeed have some nasty ideological baggage.

I'm no fan of Palin.  In fact, I smacked her hard on an old blog.

The Crimes of Sarah Palin

For those Palininsta’s out there who consider Sarah Palin the magical elixir for a conservative revival, I want to caution that she is very much bought and paid for by the anti-sovereignty gangs that includes the United Nations, the CFR, the Bilderbergs and every other sovereignty slashing initiative devoted to global governance and the utter destruction of the Constitution of the United States of America. Simply put, Palin is an absolute fraud. Conservatives have been deceived for far too long by the likes of Bush 41, Bush 43, McCain, Palin and ilk.

Palin is on record supporting ratification of the Law of the Sea Treaty (LOST), a sovereignty slashing UN global governance treaty that puts 70% of the earth’s surface under UN taxing authority and control. Moreover, LOST is also the equivalent of OPEC on steroids because it actually creates a global energy cartel.

The global governance group, Citizens for Global Solutions, specifically praised George Bush and Sarah Palin for their endorsement of ratifying LOST.

A Palin Truth: Alaska's Welfare Queen and Redistributionist

As the Palinistas attempt to crown Palin the latest Republican version of an American absolute monarch, let's examine some truth.

Palin claims to be a supporter of free markets and low taxes. But in 2007 she raised the taxes on Big Oil operating in Alaska because she wanted to transfer wealth from Big Oil to Alaskans who actually get a direct annual cash stipend ranging from $1,500 to $2,000 depending on how much money is in Alaska's Permanent Fund.

Palin did what Democratics do best - redistribute wealth and this message is ballot box gold. However, instead of calling Palin's act of oil wealth confiscation an act of socialism, Republicans praised Palin for cutting a better deal for Alaska. When the Dems do what Palin did, they get bombarded by Republicans with vicious and accursed accusations that scream "socialism" and "Marxism".

Palin's oil tax has backfired because exploratory drilling in Alaska has slowed with negatiive economic consequences. Moreover, Alaska now seeks to tweak its oil tax by handing out special tax benefits.

It's fair to say that I used beat up on Palin all the time on Facebook when her supporters were trying to win her the Republican nomination.  In fact, I beat her up so badly that those who were attempting to get her nominated as the Republican nominee ganged up on me, reported me to Facebook and my account was shut down.

But moving along to the here and now, we must deal with the basic rule of politics:  We are all useful idiots unto one another.

Undoubtedly, Palin has witnessed the success of Rand Paul, the Rand Paul that she endorsed and got elected.  Palin is also well aware of the success of Ron Paul's liberty movement that took enough votes away from Romney in critical swing states that the Republican Party lost another presidential election.

Personally, Palin has been evicted from the highest echelons of Republican power.  Fox News has ditched her, she's been marginalized as a kook and now the powerful Bush/Rove machine is 100% committed to squashing the Tea Party movement, the Rand Paul's within the Republican Party and taking control of the entire GOP machine for the exclusive benefit of raising Jeb Bush as the next Republican messiah.

I used to say that the Republican Party was like a 3 legged table consisting of the social conservatives, the Rockefeller Republicans and the constitutional liberty activists.  Take one of those legs away and the table falls, as did indeed happened on election day 2012.  However, the paradigm consisting of the Republican battlefield has changed.  It's now the Bush/Rove machine, heir to the Rockefeller Republican statist NWO legacy, vs. Paul/Palin and the rest of the Republican base.

Palin is well aware that Bush/Rove played a critical role in dethroning her.  Hell hath no fury like a woman scorned and Palin fully intends to extract her pound of flesh from those who wronged her.  Palin sees OPPORTUNITY knocking and she's not the kind of gal to pass up an opportunity.  Palin is now hitching a revival of her star power to the liberty train and she doesn't care how many establishment Republicans lie dead on the battle field.

Palin reminds me of the famous Delacroix painting hanging Louvre titled Lady Liberty Leading the People.  I can see Palin's head on the heroine of the partially nude woman brandishing the American flag as she charges forward and tramples the fallen bodies of establishment Republicans and the Bush/Rove machine.

Yeah, Palin's got baggage but she can once again rise above it.  Besides, nobody has more ugly and hideous baggage than the Bush Crime Family but that's another story.  However, I did smack the Bush Crime Family by exposing their big Democratic spending ways as well as their stupendous contribution to the big $16.6 trillion pile of debt.

Can the Big Spending Bush Crime Family be Stopped, and Jeb's Love of LBJ

George H. W. Bush contribution to the mountain of debt: $1.6 trillion

George W. Bush contribution to the mountain of debt: 4.9 trillion

George W. Bush Deficit inherited by Obama: 1.3 trillion

Total contribution to debt of 2 Bush presidents: $7.8 trillion with nearly half (47%) of the $16.6 mountain of debt attributable to Bush 41 and Bush 43.

American really can't afford another Bush president.

It's always the people vs. the establishment and if Sarah Palin can strike an enduring blow at the establishment, that's a big plus for the people.  Sarah Palin isn't standing with John McCain.  In fact, she is standing with Rand and proudly tweeted: Proud to #standwithrand since 2009. GOP, we need more courage like this!

Go Sarah!  

Conor Friedersdorf on How the Establishment Press Got Rand Paul Wrong

The Atlantic definitely leans establishment statist progressive but this excellent analysis of Rand Paul by Conor Friedersdorf is definitely worth digesting because it suggests profound ramifications for the powers that be on all sides of the political spectrum.

I commend Friedersdorf on his outstanding and insightful analysis that deeply and provocatively challenges progressives for falling down on the issue civil liberties because if anything, civil liberties have historically been the calling card of liberals, progressives and Democrats.

How the Establishment Press Got Rand Paul Wrong

CONOR FRIEDERSDORF is a staff writer at The Atlantic, where he focuses on politics and national affairs. He lives in Venice, California, and is the founding editor of The Best of Journalism, a newsletter devoted to exceptional nonfiction.

Most journalists failed to anticipate his role in the Senate, focusing instead on a distracting controversy about the Civil Rights Act of 1964.

When Rand Paul emerged on the national scene in 2010, staffers at places like The Cato Institute and Reason backed him more enthusiastically than any other U.S. Senate candidate. Like all Tea Party-affiliated pols, Paul favored smaller government, tax cuts, and free-market reforms. Unlike Marco Rubio or Christine O'Donnell, the Kentucky Republican was expected by right-leaning libertarians to oppose the bipartisan excesses of the post-9/11 era. As Radley Balko argued that spring, Paul would be better on civil liberties than President Obama and most Senate Democrats. Few non-libertarians believed him, as evidenced by the skeptical replies of progressive writers Adam Serwer* and Jamelle Bouie, savvy civil libertarians in their own right.

Three years later, it is beyond dispute: Paul is a leading opponent of civil-liberties abrogations, executive-power excesses, and militarism. Safe to say, after last week's filibuster, that his stands on those issues are the most visible and consequential that he has taken in the Senate. Even prior to that 13-hour spectacle, Paul mounted high-profile, sometimes lonely efforts to reform the Patriot Act; formally end the president's authorization to wage war in Iraq; reform drug laws; prevent indefinite detention; extend Fourth Amendment protections to electronic communications; require warrants for drone surveillance; reform overzealous TSA screening procedures; and stop an anti-piracy bill that would have onerously infringed on free expression online.

He's also opposed calls to wage war in Libya, Syria, and Iran.

Friedersdorf then plunges into a discussion on how the progressive media focused its entire coverage of Rand Paul's 2010 campaign on the civil rights issue and nothing else.

In light of this record, the establishment press ought to reflect upon the fact that its 2010 coverage utterly failed to anticipate the most important consequences of electing Paul to the Senate. Go back, as I just did, and read every story The New York Times published about him. Its coverage was representative: The paper paid little attention to his anti-war, pro-civil liberties, pro-checks-and-balances proclivities, though those issues were certain to loom large between 2010 and 2016; it paid some attention to the political import of a possible victory by a Tea Party Republican; and it focused intensely on Paul's position on the Civil Rights Act of 1964, legislation that passed when he was two years old and certainly won't be revisited in the foreseeable future.

Basically, Friedersdorf goes into lamenting how the liberals and progressives consistently ignore the profound significance of civil liberties and why restrictions on government power is the only vehicle  to guarantee civil liberties.   He extensively focuses on Rachel Maddow who devoted an entire show in 2010 to smacking Rand Paul on civil rights.  While Maddow may be an iconic figure on the left, she has abandoned all the principles of classical liberalism and opted instead to collect her fat $4 million a year MNSBC salary to grow her $13 million net worth, here.  Maddow is very much a soul mate of the hardcore theocratic Nazi neocons that she falsely claims to despise.  While Maddow may be a shameless money obsessed tool of America's descent into a Nazified militarized police state, Friedersdorf is an honest liberal who really does ponder the morality of an issue.  Maddow is pure entertainment who fires up a largely uninformed and ignorant base, same as Fox News fires up the uninformed and ignorant on the right.  For Fox and Maddow, it's all about entertainment and firing up raw emotions in folks who cling to totalitarian thuggery, anger and hate.

Friedersdorf comes to the conclusion that Rand Paul is not only good for civil liberties but he also raises the critically important issues of the War on Drugs and the War on Terrorism.

I'd argue, after three years of Senator Paul, that his record on civil rights is much better than average, and far better than what his Republican opponent in that primary would've managed. The Bill of Rights has no more consistent defender in the Senate than Paul. And he has pointed critiques of the War on Drugs and the War on Terrorism, the two federal policies that do more harm to minorities than any others.

Friedersdorf was especially happy as well as relieved when Rand Paul reassuring said in the words of Friedersdorf that Paul "ultimately agreed, saying that, upon consideration, he would've voted for the Civil Rights Act, becoming the millionth politician to figure out that an ideological position he'd taken couldn't ultimately be defended and complicating his position for political and substantive reasons".

Then Friedersdor did the unthinkable.  He expanded the civil rights issue to the civil liberties issues in War on Terror and finally figured out that they are indeed related and that Rand Paul is in fact a ferocious defender of all civil rights, including the civil rights of Muslims.

What almost no one in the establishment press seems to realize, even today, is that the qualities that led Paul to defend his wrongheaded discomfort with the Civil Rights Act is the same stubbornness, political courage, and deeply felt commitment to libertarian principles that makes him willing to express the opinion that just because someone propagandizes for Islamists doesn't give us the right to kill them; or that even accused terrorists deserve due process; or that if you have a cousin in the Middle East who you talk to on the phone that shouldn't put you at risk of warrantless surveillance or a drone strike.....

What's particularly galling about the people who continue to portray Paul as a quasi-racist with unenlightened views on civil rights is the fact that he is doing far more than most senators to protect the minority group presently subject to more institutional racism than any other: Muslims. He has been criticized by some for focusing in his filibuster on American citizens being targeted by drones, spied upon, other otherwise violated by the federal government. What about foreigners? This ignores the fact that he has expressed skepticism of drone strikes abroad on many occasions, once going so far as to say that "I don't believe Jesus would've killed anyone, or condoned killing, perhaps not even in self-defense;" and that when Paul defends Americans against warrantless spying, indefinite detention, harassment at the airport, and drone strikes on U.S. soil, he is opposing policies that disproportionately hurt powerless minorities and stigmatized others....

I suspect that the above words were indeed a defining connect for Friedersdorf who was able to finally grasp the concept of natural rights as they relate to civil rights and civil liberties everywhere.  It's like a Libertarian light bulb lit up in his brain.  But more importantly, Friedersdor was able to sort through the fraudulent media talking points on both sides and get to the real issue, namely, that the issue of drone strikes on foreign or US soil are wrong because they murder folks and they murder without due process.  If that's not a profoundly significant civil liberties issue, I don't know what is.

Then Friedersdorf quoted an e-mail from an American Muslim, Falguni Sheth .

Is Paul any more racist in his economic and drug policy endorsements than the White House in its policies of kill lists, targeted killings, drone strikes, TSA no-fly and watch lists, Department of Homeland Security's Secure Communities program or "See Something, Say Something" policy?" "Is Rand Paul more of a threat to black and brown populations (American or foreign) than the current administration, which deported more than 1.5 million migrants during its first term and separated tens of thousands of migrant parents from their children? Is Rand Paul more of a threat to our safety than the current administration?

Despite the White House's defiant disregard of procedure, transparency or accountability, the Democrats disassociated themselves from an important strategic ally -- a libertarian who is the only one asking the questions that progressives, Occupy protesters, political dissenters, Muslims, Arab Americans, African-Americans, Latinos, South Asians and undocumented migrants want an answer to: Will the president claim and exercise the power to kill one of us at his and his advisers' discretion?

Not only are the words of Sheth and Friedersdorf an outright indictment of Obama and his administration on foreign policy and civil liberties, they also constitute a justifiable critique of the left, progressives and Democrats for their utter failure to defend human rights anywhere as he talks about Bloomberg's stop and frisk policies and spying on Muslim college students.

Compare the reaction to Paul's comments on the Civil Rights Act to Michael Bloomberg's ongoing stop-and-frisk policy and the NYPD task force he sent to New Jersey to spy on innocent Muslim college students. I understand why the Civil Rights Act is regarded as sacrosanct, but treating non-racist, abstract discomfort with one of its provisions as a more important than actual, ongoing state harassment of innocent blacks and Muslims is bonkers.

I don't know of anybody in the progressive camp that has managed to raise so many important issues and strike at so many raw nerves. While Libertarians and liberty activists have indeed struggled mightily to get these exact same points across to the American people without playing the left vs. right game, I do believe that this critically important issue is finally advancing and to the shame of both Republicans and Democrats who have hidden for decades behind the facade and legitimacy of government power, a power that is finally being exposed for the civil liberty crushing nightmare than it is.

Friedersdord winds down his epic piece with:

But the establishment press should recognize that much of its early coverage of Paul did more to obscure than illuminate the sort of senator that he'd be; that this is partly due to a bias against non-establishment politicians, including libertarians; and that if Paul were to leave the Senate tomorrow, the U.S. would lose one of a very few national politicians challenging executive-power excesses, unnecessary foreign wars, and racist, xenophobic policies that have resulted in thousands of innocent people being killed, imprisoned without charges, surveilled without warrants, or otherwise harassed by authorities in the name of fighting terrorism....

While it has been the dream of Libertarians, liberty activists and civil libertarians everywhere to pierce the armor of the diehard Republican right and Democratic left to dislodge them from blind party loyalty and obedience, I believe that Rand Paul has definitely succeeded in piercing that armor.

Liberty should never be a right vs. left issue and Rand Paul is changing that paradigm, especially since neither the Republicans nor the Democrats hold the high moral ground on civil liberties and both have been a big fail.

Can the Underground Economy Take Down the NWO, its Banksters & Thieving Governments?

Wolf Richter who runs the website Testosteronepit.com had a fascinating article about how the Italians are wealthier than the Germans.

A “Politically Explosive” Secret: Italians Are Over Twice As Wealthy As Germans

Germany’s federal government only had a minuscule deficit in 2012. But high taxes and the citizens’ greater willingness to pay them—though cheating is a national sport—have over the years extracted a lot of wealth from the people and transferred it to the government. In Italy, people have been more adept at hanging on to their wealth.... 

It could stir up a firestorm in Germany. It’s not just jealousy. Strung-out German taxpayers would have to be bamboozled into bailing out the mountain of Italian government debt that the Italians, whose median wealth is twice that of Germans, refused to pay for. It won’t sit well. Not at all.

While it's true that the Germans have born the financial brunt when it comes to bailing their southern European EU neighbors, there's a much bigger question here.  Why are the Italians financially better off than the Germans?  Germany is indeed the powerhouse economy of Europe as well as one of its more financially solvent nations.  Conversely, Italy and the Italian economy are boiling to death in its cauldron of unsustainable debt.

What is absolutely certain is that high tax nations tend to spawn underground economies, especially in bad economic times when the folks perceive that government no longer offers them any value.  The proliferation of underground economies translates to cash and/or barter economies that are beyond the tax collectors reach.  Folks who make the decision to just opt out of the system typically refuse to pay taxes to thieving governments and they also tend to opt out of the traceable electronic banking system.

While the growth of underground economic activity does vary from nation to nation and region to region, they are getting noticed.  ChiefExecutive.net wrote about the rise of the underground economy in high tax California and also discussed other underground economies.

What California’s Growing Underground Economy Says About Sacramento

The underground or “black economy” generally refers to transactions that go unreported to evade taxation. Most people associate this with the illegal drug or sex industries but when government policies seek to reach further into private activities it often has the effect of driving activities that are normally above ground such as repair, services, and construction into cash or barter transactions.

Countries such as the U.S., Switzerland and Japan historically have had relatively small, nonreporting and/or illegal sectors, a typical estimate falling between 8 percent and 13 percent of GDP. Most European countries with higher taxes and regulation report underground economies of at least 20 percent of GDP with countries such as Italy and Greece having at least 30 percent of all economic activity going unreported.

Economic studies have shown that when people believe the taxes they are required to pay are reasonable and the political leaders tend to spend their tax dollars wisely, tax compliance rises, and when the reverse is true more economic activity is driven underground. California is showing signs that it is beginning to share one more characteristic with countries such as Greece and Italy: Its black economy is on the rise.

Last December, the LA Times reported that Sacramento officials are increasingly agitated by employers who pay their workers cash under the table to avoid payroll taxes, workers’ compensation insurance and other government mandates. This is in addition to smuggled cigarettes and counterfeit apparel. Officials believe that these underground activities are costing California about $7 billion annually in lost tax revenue.

It's been reported that that up to 50% of all Greek economic output is underground and the Italian underground economy is 2nd only to Greece, all of which means that the Italian underground economy is substantial and probably growing.

If the Italians are wealthier than the Germans, it's because they are keep their money earned in the underground economy.  The underground economy is a very good thing because it represents a phenomena that is literally terrorizing big spending governments by depriving them of revenues and the power to plunder.  USA Today has reported on the underground economy.

Tax evaders in Greece, Spain and Italy better beware

In Greece, tax officials fly helicopters over residential areas to spot swimming pools of the alleged poor. In Italy, inspectors raid elite ski resorts to catch the down-and-out in their Ferraris. In Spain, taxmen snoop about homes rented to sun-seeking vacationers — then visit the owners who neglected to report the income.

Evading taxes is almost a national pastime in European nations such as Greece, Spain and Italy, and for years their governments largely looked the other way.....

Greece, Spain, Italy, Portugal and other countries are raising taxes and clamping down on those who have found creative ways not to pay them. Many people admit they cheat, but the wealthy say they are being unfairly singled out to cover for government overspending — and people in the middle class, who have seen their household incomes crumble, are bitter about losing even more to taxes.

Governments are so desperate for money because they've over-spent, over-taxed and over-borrowed that they are attempting to frame the crisis in the context of class warfare since they no longer have the cash, tax revenues or debt proceeds to fund entitlements that were never affordable anyway.  That's precisely what the French socialists led by Francois Hollande did and they promptly raised taxes on the rich to 75%.  Well, the rich as well as businesses started fleeing France in droves, a situation that only made the dire economic situation even worse.

The delusion that taxing the rich will solve all problems is just that - a delusion.  The famous French actor Gérard Depardieu  who moved to tax friendlier Belgium was already paying 85% of everything he earned to the French government and that was before the Hollande 75% tax increase, here.

“I was born in 1948,” he wrote, “I started working aged 14, as a printer, as a warehouseman, then as an actor, and I’ve always paid my taxes.” Over 45 years, Depardieu said, he had paid 145 million euros in tax, and to this day employs 80 people. Last year he paid taxes amounting to 85 per cent of his income. “I am neither worthy of pity nor admirable, but I shall not be called 'pathetic’,” he concluded, saying that he was sending back his French passport.

The 'tax the rich' strategy is a fraudulent con and many of the tax absconders are just ordinary working stiffs attempting to survive and feed their families in an economy that has gone very bad for them.  Reuters detailed the plight of one working man, here.

Working informally, he pockets about 2,000 euros a month. His wife, a domestic helper, also works unofficially, earning 400 euros a month when she isn't busy taking care of their four- and six-year old children.

Sitting across from him at the cafe, his friend Marco flashes a conspiratorial smile when asked which side of the law he falls on.

He did want to be on the right side, he says with a sigh, but realised the economics were against him.

When taxation becomes so punitive that working class folks don't have enough left over to eat and provide necessities for their families after paying their taxes, there is zero incentive to continue to participate in the system of systematic plunder.  The rich who who are plundered at the rate that French actor Depardieu was plundered by the French government (85%) have the resources to pack up and move to tax friendlier abodes.

Governments do indeed understand capital flight and the underground economy, and they are prepared to declare war on ordinary folks who are just trying to make it in a world gone mad because survival in the NWO is verboten without government permission.  What is the government's weapon?  CASH - governments are restricting the use of cash with the goal of creating a 100% cashless, traceable and electronic fiat currency system.

The International War on Cash

The relentless war against cash payments waged by governments worldwide has perhaps gone furthest in Scandinavia. The ostensible reason given by our rulers for suppressing cash is to keep society safe from terrorists, tax evaders, money launderers, drug cartels and sundry other villains, real or imagined. But the actual aim of the recent flood of laws rendering cash transactions less convenient or limiting or even prohibiting them is to force the public at large to make payments through the financial system in order to prop up the unstable fractional-reserve banks and, more importantly, to expand the ability of governments to spy on and keep track of their citizens’ most private financial dealings.

Many nations have already passed laws that severely restrict cash transactions and the ultimate goal is clear - abolish cash as legal tender.  However, most nations still have legal tender laws so at best all governments can do presently is to restrict the use of cash in certainly transactions.

There can be no question that cash is king in the underground economy and, quite frankly, it's the only method of survival for the multitudes caught up in a nasty economy with nowhere to go.

It's probably also true that the underground economy is the only free market economy left on the planet.  As underground free market economies based on voluntarism proliferate they will indeed start to replace the statist planned economy in a most significant way.   Governments and bureaucrats determined to maintain their power and control will resort to anything, including murder and military dictatorship, to keep folks from engaging in voluntary commerce.

The Delusional and Whacky World of Wing Nut Media

The Republican media world is simply bizarre.  From 2008 when the right wing media expected and predicted a McCain victory and through election day 2012, the entire wing nut media was ablaze with high fives in anticipation of a Romney victory.

WSJ's Republican pundit Peggy Noonan wrote "All the vibrations are right....Romney's slipping into the presidency...".  Whether it was Karl Rove begging Fox News not to call the election for Obama or crazy Dick Morris predicting a Romney landslide victory, the right wing media was cocky, confident and convinced that Obama would be decisively defeated.

The Republicans were right about one thing - the election results were indeed decisive and Obama smacked Romney with 332 electoral votes to 206 for Romney.  The Republicans lost the 3 critical swing states of Florida, Ohio and Virginia with cumulative electoral votes of 60, and still nowhere near enough to overcome the 126 electoral vote difference.  To win, Romney needed to flip some purple-blue states to the red column.  That never happened.  Why?

I don't think that voters necessarily despise the Republican Party so much as they intensely despise Republican voters.  After all, voters who vote Republican will get big government, big spending and endless entitlements in the welfare-warfare state.  Republicans really don't govern any differently than Democrats and the Republicans have done absolutely nothing over the decades to rein in spending, deficits and the debt.

What is it about Republicans voters that totally creeps folks out?  It's the religious right and social conservatives who have fallen from ballot box grace.  From candidates like Akin of the 'legitimate rape' fame to Mourdock who echoed Akin on rape by suggesting that rape doesn't exist to a 'human being is created at the precise moment of conception' folks demanding constitutional protections for a freshly fertilized zygote, to demands that all abortion under any circumstances be outlawed, to hatred for homosexuals, the Republicans are generally viewed as theocratic Nazis on issues of social tolerance, gay marriage and abortion rights.  Toss in the Republican worship of endless wars and the mix becomes even more toxic.

Nowhere were the sentiments of the Republican base more clearly evident than in the 2012 SC primary debate.  Oddly, most in the angry Republican mob audience had just left the prayer vigil tent that was set up adjacent to the debate site.  Prayer and reflection didn't stop the rabid Republicans from booing Ron Paul when he suggested that America invoke the Golden Rule on foreign policy.  The Republican prayer infused audience cheered loudly when somebody suggested that uninsured folks should just die and Newt Gingrich got a standing ovation for shouting 'kill em'. Gingrich went on to win the SC primary as he shamelessly pandered to disgraceful, hideous and repugnant Evangelical crowds.

The wing nut media will never criticize these folks for being the arrogant and insufferable jackasses that they really are.  In fact, the wing nut media actually cheers them on to greater heights of absurdity and lunacy.  Furthermore, wing nut media is never about solving big problems but always and exclusively about beating up on the Dems, Obama and gang.  It matters little to the wing nut media that the Republicans pretty much mirror the Dems in policy, growing government and big spending, all of which is only evil when the Democrats do it but never evil when the Republicans do the exact same thing.  Go figure.

The Huffingpost recently chirped in on the state of wing nut media, not that its vigorous defense of all things Democrat and Obama in anyway elevates the Puff Post to the moral high ground.  That said, the Puff Post did make some decent points.

Conservative Media Struggles For Credibility, Amid Coverage Of Hookers, Hamas And Hagel

The National Review, a leading voice in the conservative movement since 1955, isn't cutting back on opinion writing or strong editorial stands. But Costa and his team of three reporters are gaining recognition inside Republican circles and among the Washington media establishment for actually making calls, staking out the Capitol and breaking news. Costa recently reported the inside story of the attempted House GOP "coup" against Speaker John Boehner (R-Ohio) and scooped that former Republican presidential nominee Mitt Romney will speak at this year's Conservative Political Action Conference.

It's the type of shoe-leather reporting that many political observers and even some prominent conservatives claim is sorely lacking on the right. Their critiques seemed confirmed this past month as several conservative media-driven stories fell flat, from speculation that Chuck Hagel wouldn’t be confirmed as defense secretary to reports that he’d spoken to a shadowy (and fictitious) group called "Friends of Hamas." On Friday, a prominent conservative writer and commentator was found to have been heavily involved in a paid propaganda operation funded by the Malaysian government. And over the past 24 hours, both The Washington Post and ABC News have called into question an explosive Daily Caller story alleging that Sen. Robert Menendez (D-N.J.) slept with prostitutes in the Dominican Republic.

And so, while outlets like The Daily Caller, Breitbart News and the Washington Free Beacon have sprouted and, in some cases, prospered during President Barack Obama's administration, concern is mounting that they and others in the conservative media universe are shedding their credibility by focusing more on supposed scandals than reporting the basics of who, what, when, where, why and how.....

RedState editor Erick Erickson argued last week that conservative outlets have been "failing to advance ideas and stories" beyond their ideological borders. "The echo in the chamber has gotten so loud it is not well understood outside the echo chamber in the mainstream press and in the public," Erickson wrote. "It translates only as anger and noise, neither of which are conducive to the art of persuasion."....

Conservative media made noise during the 2012 election but had little impact on the news cycle. Both The Daily Caller and Breitbart News hyped old videos of Obama, which despite being amplified on The Drudge Report and Fox News, received more mockery from the national press than follow-up. In response to Romney’s infamous "47 percent video" –- a clearly newsworthy recording –- Fox News attempted to equate his remarks with a 14-year-old Obama quote about wealth "redistribution."

Personally, I find Red State and Erick Erickson vile beyond comprehension because Erickson and his site engage in a ton of pandering that incites anger and rage.  However, Erickson does make a valid point. Moreover, the anger that fires up the Republican base definitely isn't the kind of anger that fires up voters in national elections. All those angry Republicans really aren't angry over what Obama actually does but just the fact that the Republicans can't claim the credit for doing the precise same thing.

Republicans may be long on anger and short on solutions but they've definitely succeeded in alienating the youth vote, the female vote and the Independent vote, 3 big voting constituencies that determine general election outcomes. The socially tolerant young have no use for theocratic Nazis who bash homosexuality. The female voters are terrified that a Republican in a Nazi uniform will show up and put a gun to their head to prevent them from taking the morning after pill or having an abortion. Even worse, the rants of some Republicans who suggest that violent rape really isn't a crime at all but consensual sex has left Republicans looking like gang of whackjobs. The Independents, by far the smartest and most informed group of voters, have no use for Republicans or its gang of social conservatives.

Meanwhile, the wing nut media dances on as if all is well but opine that things would be be a whole lot better if the Republicans could just find the right candidate. But alas, any decent candidate with wide appeal across party and independent lines will never get passed the Republican base. Those who ask the questions that need to be asked, address the issues that need to be addressed and speak a truth that needs to be spoken are shunned like the plague.

Are the Neocons Changing their Stripes? Don't count on it and here's why.

Like the Bob Dylan song, Times They Are a-Changin, Senator Rand Paul struck a raw nerve in GOP circles with his famous, media and Twitter viral filibuster.  Rand Paul didn't succeed in stopping John Brennan, the godfather of murderous drone strikes, from being confirmed as the new head of the CIA but he definitely succeeded in bringing drone use and US foreign policy out of the GOP's closet. For that he was cheered and jeered but mostly cheered by civil libertarians on the right and left.  The jeers flowed from old guard neocon whackjobs like John McCain, Lindsay Graham and their reliable partners on the left.

The Jeers:

McCain, Graham Attack Rand Paul for Anti-Drone Filibuster, Antiwar.com that stated "Paul's question about Obama's authority to kill US citizens doesn't deserve an answer, Graham said".

James Carville: Rand Paul’s ‘Nutty’ Concerns About Drones Akin To Birtherism, Evolution Deniers Mediaite

MSNBC Hosts Mock Rand Paul: Made Serious Issue Of Drones Sound ‘Absurd,’ ‘Crazy,’ ‘And On The Fringe’  Mediaite

It should come as no surprise that the far left and far right were at the forefront in attacking Rand Paul. These bat shit crazies have no respect whatsoever for the constitution, civil liberties or peace.  They are a pox upon humanity everywhere.

The Cheers:

While the cheers were loudest among civil libertarians, the cheers also hailed from some surprising places like the traditional standard bearers of neocon foreign policy.  Rush Limbaugh, the icon of Republican talk radio, actually smacked McCain and Graham while defending Rand Paul.

Limbaugh Hits McCain And Graham For Opposing Rand Paul, Dining With Obama: ‘Who Are They Siding With?’

Laura Ingraham, another popular neocon icon of Republican talk radio wasted no time praising Rand Paul and promptly interviewing him on her radio show.

Laura Ingraham: Neoconservative view has clearly hurt the GOP (Rand Paul interview 3/08/13)

The neocon armor is slowly cracking. With both Rush Limbaugh and Laura Ingraham standing with Rand, the foreign policy debate will be brought out of the Republican closet and this will not bode well for Republican foreign policy hawks. It's not that either Limbaugh or Ingraham even care about peace, liberty or the constitution but they are apoplectic over back to back Republican general election losses. Folks like Limbaugh and Ingraham are not motivated by ideology; in fact, they are merely weathermen who sense and follow the political winds. Right now in America, the political winds are strongly blowing away from costly foreign interventionism and non-stop wars.

Despite all the glowing and supportive tweets, as well as the right wing media professing its undying love for Rand Paul, we have to ask ourselves if any of this in any way signals that the Republican Party and its pundits are serious.

Or is it more like a stealth date when the guy has a romance strategy to get in her pants because he really only wants to screw her?

Despite the barrage of poetic wing nut words, the neocons can never be trusted.  Every conservative, constitutionalist and small government advocate has been down this road many, many times and drank the Koolaid with the flavor FOOL.

How will we ever know if they are serious?  That's not difficult.  Just look back in history and how the Vietnam War finally ended.

How Congress Ends Wars, It always comes down to money

As the Democratically-controlled 110th Congress searches for a way to end the Iraq war authorized by the Republican-controlled 107th Congress, it seems appropriate to recall how the U.S. Congress ended the Vietnam War, and more recently, further U.S. military combat involvement in Somalia. At the end of those dark days, ending the battle came down to ending the money.

On Aug. 5, 1964, Congress enacted the Tonkin Gulf Resolution, authorizing President Lyndon Johnson to use "all necessary measures" to repel armed attacks against U.S. forces in Vietnam. The resolution passed easily, 466-0 in the House and 88-2 in the Senate, with the only dissenting votes coming from Democratic Sens. Wayne Morse (Oregon) and Ernest Gruening (Alaska).

Unlike the resolution authorizing the use of U.S. military force in Iraq, the Tonkin Gulf Resolution contained language allowing Congress to repeal it at any time. Unsuccessful congressional efforts to repeal the Tonkin Gulf Resolution began as early as 1966, just two "quagmire-ish" years after its passage. Finally in January of 1971, Congress succeeded in passing a measure repealing the Tonkin Gulf Resolution. While he did not veto it, President Richard M. Nixon refused to honor the measure and continued to wage the war, claiming presidential authority to do so as commander in chief of the military. But, another far more effective act of Congress would ultimately end the Vietnam War by closing the federal purse strings.

In December 1970, Congress reacted to the U.S. invasion of Cambodia by passing the landmark Cooper-Church amendment to the Foreign Military Sales Bill. The amendment, named for and sponsored by Sens. John Sherman Cooper (R-Kentucky) and Frank Church (D-Idaho), prohibited the use of any funds already appropriated for military spending on the introduction of additional U.S. troops into Cambodia. While President Nixon denounced Cooper-Church as harming the war effort, he failed to veto it. Today, the Cooper-Church amendment is regarded as the first congressional action taken limiting presidential powers during a war.

Following Cooper-Church, and even after the Paris cease-fire agreement, Congress literally dropped the hammer on the Vietnam War with its passage in 1973 of a joint resolution (H.J.Res. 636) prohibiting any further appropriation or expenditure of any funds for any "combat in or over or from the shores of North Vietnam, South Vietnam, Laos or Cambodia.

And that's precise how wars end.  When Congress finally refuses to fund them through appropriations, they are over.

Let's get back to the GOP.  What Republicans are willing to defund the current wars?  For that matter, the same question also applies to the war friendly Democrats.  It would be nearly impossible to find a Republican or Democrat who would agree to defund the wars, let alone reign in executive powers.

When Republicans and their pundits start demanding that the wars be defunded along with military spending, that's when you know somebody is serious about ending the wars.  If a candidate is unwilling to vociferously and loudly campaign on ending war funding, then they are still fully committed neocons.

Who is talking about the cost of the wars?  Absolutely nobody but I blogged about war costs.

The Cost of America's Wars - $3 Trillion, $4 Trillion, $5 Trillion, $7 Trillion, $8 Trillion, Going Once, Going Twice, SOLD

If Americans want to understand why America is bankrupt and why the economy lies in ruins, look no further than war spending.

Meanwhile, it's definitely not time to start singing Bob Dylan's song, Times They are a-Changin.

#StandwithRand: Hitching a Ride on the Hashtag Liberty Political Activist Train

“Are we so afraid of terrorists that we are willing to throw away our rights and our freedoms?” Rand Paul

While the power of social media is indeed becoming a potent political and activist force that is acutely threatening the information monopoly of mainstream media, the power of Twitter was vividly visible last night during Senator Rand Paul's incredible nearly 13 hour filibuster of the CIA Brennan nomination over the use of drones to murder American citizens on US soil.   I wasn't the only person glued to Twitter last night and the hashtag #StandwithRand, and it seemed like everybody who cares about politics and civil liberties was glued to Twitter for many, many hours.  Last night became a defining moment in the power of social media.

While I'm of the opinion that the Republicans who showed up (late) to Stand With Rand were mostly frauds politicizing the event for their own political benefit because most of them did in fact vote for NDAA, indefinite detention, the Patriot Act and other horrors, what is most fascinating is the liberal response that clearly groaned disappointment with the Democrats.

I do, however, give much deserved credit to Republican Senator Mike Lee and Democrat Senator Ron Wyden who stood with Rand early because they've mostly been at the forefront in the battle for civil liberties and have decent voting records to prove it.

For whatever reasons, Rand Paul made the Republicans look good last night and many liberals and Democrats were utterly appalled and shocked that only one Democrat had the courage and conviction to Stand With Rand.

Glenn Greenwald, a liberal anti-war icon of civil liberties and a constitutional attorney tweeted:

Glenn Greenwald @ggreenwald "Fascinating day: Tea Party Senator filibusters torture-supporting CIA nominee over civil liberties, while Dem establishment mocks & fumes"

Liberal leaning and very popular pundit/commedian Jon Stewart praised Rand Paul.

JON STEWART: Rand Paul Used The Filibuster 'The Way It's Meant To Be Used'

"The Daily Show"'s Jon Stewart opened his show Wednesday night by praising Sen. Rand Paul, who was at airtime still in the midst of a nearly 13-hour filibuster of John Brennan's nomination as CIA Director.

It's significant coming from Stewart, the left-leaning host of "The Daily Show" who has recently been on a crusade against what he sees as hypocritical policies from the Obama administration on its targeted killings through drone strikes.

"I can't say that I agree with Rand Paul about everything, but as issues go, drone oversight is certainly one worth kicking up a fuss for," Stewart said.

Another very popular and respected liberal TV show host,Cenk Uygur, tweeted:

Cenk Uygur @cenkuygur Courageous effort by Rand Paul today. He made believers out of some people and shined a light into the darkness. #StandWithRand

Now 15 Senators have joined Rand Paul in his #filibuster in its 13th hour.Only one Democrat. Progressive Dems, where are you? #StandWithRand

If anything, liberals, progressives and Democrats have traditionally claimed and held the moral high ground on civil liberties.  It's understandable that many astute and well meaning Democrats are literally sick over the unwillingness of congressional Democrats to oppose drone murders.  Moreover, to bear witness to Obama and his administration effectively out-Bushing the Bush gang on horrifying civil liberties abuses is unspeakable as well as unbearable for civil liberty minded Democrats.

If anything, the big winners land night were Rand Paul, Senators Wyden and Lee, and civil libertarians of all political stripes who absolutely know how to sift through the Republican and Democrat garbage pile of hallow and shallow talking points to get to the truth.  And that's precisely what happened last night:  the truth was courageously distilled to its absolute and raw essence by the people and truth tellers.

In an age of vanishing civil liberties and increasing government oppression, that's not insignificant.  It's a monumental leap!

Meanwhile, Senator Rand Paul is doing his part to fire up the smoldering embers of liberty and that's a very good thing.