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Now that we’ve started growing our economy, it has become a persistent theme… “We need money for this”; “we need money for that”; “we need money for both and for other things too”.  “We need money”, pure and simple.. Am I not right? Pick up any paper. Listen to any radio newscast; read any internet news source…. (did you notice I completely ignored television entirely? You should ignore them too if you don’t already ).

Now correct me if I’m wrong, but (and this is a theoretical question…):  when you want something that you don’t have….a)  do you go asking for it among people who don’t have any themselves, or b) among people who have lots of it to spare?

Hmmm. I wonder…. (finger on chin; one eye looking at the sky)  Should I ask those who have, … or those who don’t have….

Which makes Markell’s asking our Seniors to forgo their credit on school taxes allegedly to balance the budget, nonsensical..  Especially when the top 1% of Delawareans by simply adding a few lines to the tax code. can cough up $70 million a year… (enough to roughly fund 3 years of casino shortfalls) and not experience any loss of spendable cash,

So why would someone ignore those who COULD give, and threaten those who have NOTHING to give?  There are probably many reasons, but none meet the level of good straight forward reasoning… For if you truly want something, asking someone who doesn’t have it is absolutely pointless….

What Seniors don’t have, the 1% does have;  (that is why they are in the one percent.)

So, being theoretical again, wouldn’t it make great sense to turn the tables on Markell and actually go forward and spitefully raise the taxes on HIS friends, those in the top one percent, oh… let us say…. about the same percent that his tax hike would have hit Seniors pinching pennies on limited incomes… to around the percentage of a 100% increase….

So it would come out that on incomes over let us say, $100 million dollars, instead of the 6% they are currently assessed, (the exact same percent as someone earning $60,000) we would hit them with a 100% increase (another 6%)  and bump that owed amount to 12%…  We could then graduate the layers from 6% to 9% over a range of income levels.. and except for the rates on the top echelons, the percentages would still be lower than neighboring New Jersey.

This gives us $70 million in new revenue. Each and every year… We can even blow it on the casino’s if we want….

We need the General Assembly to respond to Markell’s challenge with a tax increase of this nature.   Now, the point is really not so much of whether it passes or not..  But the point is that by having a progressive coalition sponsor and at the very least, put it on the floor, (especially those who hail from districts where doing such would make them a cult hero for life, and cost them zero switched votes since no millionaire would ever vote for them anyway), it becomes a bone of contention, and a topic of conversation in letters-to-the-editor pages across this state; on Al Mascitti and Rick Jensen; on WDDE and other WGMD down south, and gets talked about on both sides…

Because there is a funny thing that always happens when good ideas get talked about in the open, and one can hear both sides.  They start to get followers.  And as more and more followers pile on, as more and more support for this bill becomes apparent..  as more people start supporting what appears to be a very common sensical means of pulling our society back together, of fixing the broken door jambs that have been stepped over too long, of repairing leaking cracks too long ignored across our aged infrastructure (in both physical and human capital), then Jack will rue the day he ever threatened Senior with tax hikes they could never pay…. while ignoring those who can easily pay 10, 15, 20, 30, 40 times the amounts we will be asking of them.

And the idea that we have to cut back now on very essential stuff in what is now a richly growing economy,  all because we don’t have money when it is there, right in front of us, dangling for us to take it: is plain stupid.  Really…  Would YOU not cash in a winning Powerball ticket because you didn’t want Powerball LLC. to lose any money over you?   Somethings are smart. Some things are really dumb… Not cashing in a winning Powerball, or not raising the tax rates on the top one percent, are both…. about as equally dumb.

The point of placing this bill on the table, is that if we generate significant conversation and make a run at passing a 12% top state tax rate, or even just get that conversation out there, and get 500,000 Delawarean voter’s hopes up that yes, this legislature might finally do something responsible, and still fail by being one or two votes short… the very fact we did so helps it become far easier to have the General Assembly slip in and vote on the last day of session, a bill that raises the wealthy’s rates by 1%, or 2%, or 3%, or 4%…. And that, would be a godsend to Seniors…..

Society across the board has simply outgrown all this “cut taxes to grow” hype.  We tried it; it failed; now we remember the good years back when taxes were a tiny bit higher and we were all, everyone of us, far much happier, far better off, and all of us facing what looked to be a very, very bright future. …

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Recently a study showing the damage the Bush Tax cuts did, emerged… It was offered to all major publications who refused to publish it. Hence is emerged through what has become one of the best news sources in America today… Al Jeezerah…

The author won a Pulitzer Prize in 2001… David Cay Johnston

The Bush tax cuts, touted as a harbinger of prosperity by the Republican Party, actually robbed each American taxpayer of $48,000 in pre-tax personal income during the twelve years of their existence, for a total of approximately $6.6 trillion dollars.

In other words, you do not have $48,000 you should have had… because of that party that does nothing… How much of a difference could that $48,000 have made to you? It would have been there too, but… sigh, well, you know, you can’t go back in time and give Al Gore the presidency….

“it would have been enough to pay off all the student loans in United States ($1.26 trillion), all the automobile loans ($892 billion) and all the credit card debt ($827 billion),” he noted. “After paying all that debt off and taking taxes into account, Americans still would have more than $2.4 trillion left in their pockets and bank accounts.” Per filer, that $2.4 trillion left would be a cool $17,454 dollars…!

What you CAN do is understand that as long as Republicans have enough people to block legislation anywhere, state, local, national, from changing this… It will continue. Republicans still, at this late date, only care about the top 1%…..(For example after fighting tooth and nail to keep $10 billion that was paid for from being used on our broken down bridges, the Republican House flipped and just passed a bill to add $267 billion dollars to the national debt in the form of a tax cut for the top 0.01% of taxpayers…. ) A $267 billion dollar tax cut for the elite of the top 1%, charged directly to the debt… Meaning your children for years will be paying back this debt for no other reason than make them even richer than they are now… But we can’t have our $10 billion to fix America’s worst bridges because that is too much debt…

These same people, Who, btw… received one whole third of all the accumulative wage increases from 2001 to 2012… a total of under 16,000 households…. roughly 16 city blocks in one city, somewhere in the entire expanse of America….

The rich got richer; the poor get poorer, and the Republicans get kookier…. So are you going to do something about it?

You can. Let everyone know you aren’t voting for anyone who still says we need to cut taxes… because it is your money they are taking.

Oh, can I borrow some of the $48,000, please?

What? You don’t have it?

Take two examples….

Dr. Ringo and John Beatle are a dual income family well on their way to securing the American dream… Ringo graduated in 2008 and John graduated in 2009.  They were married in 2011 and currently share a modest apartment.  Ringo earns $79,000 as an new doctor in the Christina Health Center, and John went in to partner with an older doctor up near Naamans Road in Brandywine Hundred.  He lists his income bertween 80 and 100 thousand, and we’ll average it out as $90,000 per year… Together their gross income this past year lines up at  $169,000.  Their net, after taxes averages  $109,000 per year or $9,000 per month…   not a shabby income. 

But they pay loans. 

John’s educational loan payment is $1340 per month, and  Ringo’s is $960 each of the 12 months… Together they each write out checks $2300 per month… Their leftover income  lies around $6400 per month….  Two cars take out $1,000, their city view apartment takes $1300. their utilities $500.  Insurance $300,   What’s left?  $3,300 per month… That alone equals a family income close to $40,000 per year…  still not shabby.. so what’s the point?

 

Now take Mick and Keith Stone, a married couple from moneyed families.  They went though college and law school on parent’s money.  No bills… Mick or Mickie as she is commonly called, works at Morris and James up on the 16th floor of the WSFS building in international investment law.  She makes between $80 and $100 K per year. and so we will round that to $90,000… Her husband Keith, is an district attorney in Wilmington.  He makes $79,000 per year. Together their income is  $169, 000 and after tax their net is $109,000…. They have almost the same mandatory expenses as the Beatle family and after similar expenses, they have $5,600 per month… 

The barristers Stones put $2,300 down each month into savings to buy a new house….  Over two years, they already have $55,200 saved up, and next year they seriously plan to house shop with a down payment of $82,800…  So what’s the point?

This battle of elites illustrates one thing; how our economy is not living to its full potential due to massive amounts of college loan debt.  These examples too rich for your blood?  Then drop the incomes down to the levels of the average professional; cut each person by $40,000 or $3333 per months… The first couple is flat broke.  The second couple still has $2200 left over to live on per month, but not enough to put into savings.  Their checking account rises and falls with spontaneous purchases. 

Here is the real problem:  Track it over the 30 years length of the loans…. The Beatles have after 30 years, nothing.  The Stones after 30 years, have extra wealth strictly left over from salary, of $828,000 assuming they put it in a mattress. More likely it has grown by 7% per year… or $2.7 million…

College loans aggravate the inequality gap.  the only way to get rich in America is to come from rich parents… With everything exactly the same except for the payment of college loans, one couple has $2.7 million after 30 years… The other still living month to month… if one starts his professional career at age 25… one’s loan at 30 years termed, end when he is 55… Too late to start saving for retirement… 

The fix…. 

 

Here are the ways to close the inequality gap.

  • Forgive the loans
  • Forgive the interest
  • Tax the wealth

Options one and two are out.  Remember that most pension plans (some are still left) insurance funds, and stock options are in the entities holding these loans.   

Option 3, .. if that money was taxed on the last couple (The Stones)) but not on the first (The Beatles)  then, over a period of time, there would be equality when the loan payments finally ended…  One would not have an unfair advantage over the other.

Multiply this across the entire spectrum of students holding $1`trillion dollar in debt… a debt now too big to fail, and you get the picture of how our economy was mortgaged out to big banks long before young people could even afford traditional  mortgages…

If we simply taxed the second couple an additional $2300 sort of as an equivalent of the loan payment they currently didn’t have to make, then playing field would even out.  Only then, could the hope and promise of America then return. . 

(Keep in mind these examples were from America’s best occupations.  College loans currently keep large numbers of working Americans still below poverty levels..)

 

 

 

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Educational Success

Bottom Half of America's Educational Rankings

This data came from here.

What trends can we learn from the bottom…

To start bottom up, rank them how they vote politically.

  • Nevada  .. a swing state.
  • New Mexico — Democratic, but with a huge percentage of native American population.
  • Mississippi — Republican
  • Louisiana, Arizona, West Virginia, Arkansas, Alabama, Oklahoma, — All Republican.
  • California — Democratic with a huge Central American population.  In people it probably represents more than all the above so far.
  • South Carolina, Texas, Tennessee, Georgia, Idaho,  all extreme Republican.
  • Kentucky, always Republican but now may be swinging.
  • Oregon — Democratic
  • Alaska, Michigan — now Republican
  • Florida — historically always Republican though leaning to swing lately with new voter registration.
  • North Carolina — Republican, rapidly pulling away from everything Democratic
  • Montana — Republican values but lately a swing state.
  • Hawaii — Democratic

(I should note that in case one didn’t previously look at the charts, they should know the worst at settings ones children up for success, is ranked on top starting with Nevada, and the educational levels get better as one goes down the list until he reaches America’s midpoint, which is just after Hawaii if one come up from the bottom.)

But see any trends?

Obviously Republican states do not do well here.  Could this be a coincidence?  If so it would be odd.  That states known for their blueness are all above average when it comes time for kicking their kids out the door, and states known for their redness, are really sending their children out ill prepared…

Now in my observation, it is too hard to pinpoint this on a political party.  Those things morph to get votes.  There has to be something bigger associated with the Republican Party, but not officially a part of it.

The culprit is the belief and practicing of austerity.  Austerity when based on evidence, does not work.  True believers counter that the opposite of austerity is Socialism.  I don’t think Socialism can be so narrowly defined as setting ones children up for success.  And that is what this is about.  Taking care of ones children is not socialism.  It is a duty.  Funding the educational process is a duty required I think by every state.  Every state deserves to have their children do well.

The practitioners of austerity have dominated the argument far too long.  Our children have suffered for it.  If one wants to practice austerity, it needs to happen in areas other than education. As a society we must decide this once and for all.

The idea that one will cut taxes just to cut taxes and make all things fall in line,  cannot apply to education.  Educational funding must be maintained at a consistently adequate level, and if revenue comes up short, then let the wealthy pay more…  This idea of cutting those very essential services and means for future growth so our elite can have more pocket change, needs to stop.

Austerity may have its place, somewhere.  But it certainly does not belong in education as this chart well shows.   All those states which champion austerity, are those very states bringing DOWN America’s academic excellence…

Austerity is nothing more than society’s choosing to button down, and stuff its money into a mattress instead of investing somewhere else and earning additional income or interest off of it… Only in this case, society has chosen the 1% to be its mattress…  Now imagine a mattress actually demanding that we feed it money.  Preposterous?   Well that is exactly what has happened to American society since Bush took over after Clinton. We have willingly obeyed its orders…

This chart of states ranked by their ability to send their children out into the world and be successful, better than any other indicator I think, shows the folly of following any austerity type of program, but especially when it comes to setting up our children for success….

1) It doesn’t help anything. 2) It hurts and makes us worse off.

According to the 2012 Financial Report of the State of Delaware, there were in 2010,… 4887 people in the top 1% of Delaware’s income…  Over ten years, that number increased by 445 people.  The average AGI (Adjusted Gross Income) of just this 1% was $728,553.  if this was the average then the average times the number of people will give us the total AGI for that income bracket…

$728,553  X  4887  =  $3,560,438,511 or $3.5 billion dollars of taxable income…..

Here is a chart showing the amounts if we tax this segment additionally…. Currently top-bracketed income due for 2014 is to be taxed at a rate of 6.9%…..

2014  @ 6.9% =  $245,670,257 …

Now with additional increases in the percentage…….

.5%  = $17,802,192   new rate of 7.4%

1%  =  $35,604,385   new rate of 7.9%

1.5%=  $53,406,578  new rate of 8.4%

2%  –   $71,208,770   new rater of 8.9%

These are the amounts of revenue at our disposal, based off the 2010 data.

These rates compare to New Jersey’s at 8.97%,

Keep in mind these increases are just on the top 1%. No tax increases in this post were considered for those in the 99% category.

And please don’t feel sorry for these people having to pay more.  The  Dow Jones average is up 23.79% on the year…

Someone with $3 billion in assets acquired an income just off stocks alone, $714 million by doing nothing… It grew that much….

They certainly have a little extra cash, this year to help the state out a little…

Compare that amount to all those things now broken in the state of Delaware which get band-aids because we aren’t leaning on those sitting on this much money as we should be.

Before any knucklehead even thinks of doing away with prevailing wage, something that helps the Delaware economy, …. taxing this money pile so more stays here inside our state’s boundary must take place first.

Absolutely.