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Dumb, Silly, Sad and Ridiculous
DUMB
Congress let FUTA die on June 30th. What’s a FUTA?, you might ask.
FUTA (Federal Unemployment Tax Act surtax ) was, get this, a
temporary tax on wages that was established thirty five years ago. It
was supposed to help replenish the unemployment benefit accounts after
the 1973-74 recession. It has already been extended 9 times.
The Republican let it die. House Ways and Means Committee Chairman Dave
Camp, R-Mich., refused to extend the tax. Completely consistent with
current Republican thinking Camp had this to say:
“The
fact that it has taken 35 years for this ‘temporary’ tax to expire
clearly illustrates the dangers of higher taxes—once in place, they are
unlikely to ever go away.”
As far the dollar and cents go, FUTA is no big deal. It comes to about
$14 per person per year. The absence of this tax will only add a couple
of billion onto the annual deficit.
We are in a crisis with unemployment this 4th of July. We have been for
three years now. We are going to be in crisis next 4th of July too.
There is an enormous social cost to this. The "solution" is to borrow from the future to pay for it today.
That’s the American way. Democrats or Republicans the same. One day the lot of them will wake up to a capital market that says, “No mas!” I’m amazed that those bright folks in D.C. don’t see it coming. Maybe they’re not so bright after all.
SILLY
I love this story. I’m going to try to write a screenplay about it. This is sort of “Law and Order” combined with the “Sopranos”.
This is a very big legal case that might set some troubling precedents.
The Supreme Court has already been involved. Now it is back in the
United States Court of Appeals for the Second Circuit. A quick summary:
One company (Ideal Steel) sued another (Natl Steel) for damages due to
competition by allegedly evading taxes and thereby giving customers a
discount and filing fraudulent sales and income tax returns to cover up
the scheme, and further allegedly damaged plaintiff by using proceeds of
the scheme to open a new store resulting in additional competition.
From the court filings:
Defendants' establishment of a competing commercial enterprise through the investment of income derived from a pattern
of racketeering activity—to wit, mail fraud and wire fraud in
violation, in the filing of fraudulent tax returns and related
information enabling the evasion of income taxes.
This is a fight between two “family” owned businesses. One in the
Bronx and one in Queens NYC. This is a RICO (racketeering) suit. Some
of the arguments put forward in the case:
When organized crime infiltrates
a legitimate business, its whole method of operation counters our
theories of free competition and acts as an illegal restraint of trade.
The syndicate-owned business,
financed by illegal revenues and operated outside the rules of fair
competition of the American marketplace, cannot be tolerated in a system
of free enterprise.
So you get the connection to the Sopranos. But on the other side is a
parade of very talented (and expensive) lawyers. A good chunk of the
judicial system has been involved as this case has proceeded. At this
point the costs must be staggering. There is a lot at stake.
I'm not sure how often companies can prove their competitors are doing
stuff like what is alleged, but people would definitely be motivated to
sue. So if Ideal Steel wins, a ton of additional lawsuits against other
major companies would soon follow. And that is why this case is so
important. None other than Supreme Court Justice Breyer has already
opined:
The
(prior court decision) has warped civil RICO into a tool that aggrieved
business interests will use to harass and undermine competitors engaged
in legitimate, competitive business activities. This in turn will put the courts in the nearly impossible position
of having to ascertain which otherwise legal marketplace activity can
be directly linked to ill-gotten investments and which cannot.
When I look at this I see a very busted system. One that can only be
laughed at. One that it is struggling to survive. We are a nation of
laws. Our effort to keep it that way is killing us. Everybody hates the
bankers these days. Actually it is the lawyers who are making a hash of
it.
There is a few thousand word legal brief on this story. I ran it through
that Wordle thing. Should be worth a screen play. A tragi-comedy.
SAD
This report (Link) concluded the following regarding young adults and personal debt:
Researchers found that the more credit card and college loan debt held by young adults aged 18 to 27, the higher their self-esteem and the more they felt like they were in control of their lives.
That’s the thinking of teenagers today? The same report found that those older than 27 had a very different perspective.
Those aged 28 to 34 – began showing signs of stress about the money they owed.
There’s something very wrong here.
RIDICULOUS
This is the cover page for the new CBO report on the cost of the military: (I love the pic of the dog jumping out of the plane)
Inside the report is this chart:
A few observations:
* That horribly big dark blue hump from 2002 to today is what is referred to as “OCO” (Overseas Contingency Operations). I really think they should call a spade a spade. OCO might confuse some folks. A more appropriate description could be WAR.
* The good folks at the CBO make the (dangerous) assumption that
there will be no OCO/WAR over the next twenty years. That the mistakes
of the past won’t be repeated again. Here’s hoping on that one.
But look at the conclusions of this. On the assumption that there are no more OCOs/WARs, the military is still going to cost $650 billion a year. $13 trillion is the “plan” that we are on.
On paper, this “plan” will not work. We are not such a rich country any
longer. We can’t afford to be the cop on the beat. But the question is, “Can we afford to not be?” Time will tell.
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Nonsense. We were spending close on 50% of GDP on the military in WW2. In 1960, peacetime I remind you, the Defense spending consumed about 50% of the Federal budget. We had 3,400,000 MEN under arms in a population of 180 million. Today we have half that number ( and 20% are female) with a population of over 300 million. The draft did reduce personel costs somewhat it is true but not enough to make the comparison invalid.
Battlefield medicine is much more expensive than in WWII. The injured get stabilized and then flown back to a medical base at a cost of about $1M/serious injury. With Vietnam-era medicine, we would have had 30K dead in Iraq alone by now.
"(and 20% are female)"
Female soldiers cost less to deploy than the other kind? I know nothing, but I would have guessed that they cost more, what with all the feminine products and maternity time and whatnot. But WDIK?
Not much; female pay is what? 77 cents on the dollar these days? And...they pay for their own tampons.
Buy gold/silver, bury it somewhere, and when all this mayhem combines to bring down the ridiculous fiat system that all of the above is nourishing, you will be wealthy. All of the above silliness revolves around debt and fiat. Taking delivery of physical metal is the best way to start weaning yourself off the system for when the shit hits the fans.
My Dad told me that back in the 60's when he left the Canadian military, his superiors told him to keep his assault rifle, wrap it in oiled rags, and bury it along with silver coins (the normal coins in circulation in those days) in case the Soviets came over the pole. He did that. He was reminiscing about it recently, because he no longer remembers exactly where he buried it.
Apparently, a lot of his buddies did the same. It's hard to imagine something like that in gun-free Canada now.
Hey that sounds like a good idea, i think i heard it somewhere before, but thanks for reminding me. Sometimes i wonder if gold bugs hoard gold because its the only concept they can get their fucking heads around, umm i do wonder about that. Good luck with it, all the same.
Are you seriously this retarded in general or only on Saturdays?
I am Chumbawamba.
WTF is he saying it here for? coming to this site preaching about gold is like going into the Vatican with a Jesus saves placard around your neck.
News flash: the Vatican ain't about Jesus.
Keep sniffing for a good analogy though, scratch.
This thread is off to a dumb start already - lets hope as i continue down these titans of investing have zipped it.
+ 100
What awaits me below...?
well, at least a poetic irony of our long, expensive and largely futile foray into afghanistan: there they at least seem to prosecute bank control fraud: http://www.salon.com/news/opinion/glenn_greenwald/2011/06/30/bankers/ind...
He's only that retarded on Days ending in the letter Y.
Hey equity_homo, just think, if you only lived in the US you could be in the Hamptons by now being a fluffer...since you love the rich meat.
http://www.youtube.com/watch?v=OLqHuaRV9co