Good Speech, Mr. President. You Make Me Proud To Be An American.

My reaction to President Obama's 'State of the Union' Speech:

Good speech, Mr. President, filled with justifiable hope for the future (compared to the doom and gloom that followed you in the Republican response). Good example of that is GM's recovery...for which your administration can justly take credit. I hope that some of your proposals for 'insourcing' jobs are approved by Congress. Sound sensible to me.

I really like the 'Buffett Rule'. Makes absolute sense that Mitt Romney and people like him should be paying a more progressive chunk of their income, given their overwhelming wealth. It doesn't solve all our deficit problems, but it would help.

You are to be congratulated on your foreign policy achievements. Opponents who label you as weak or an appeaser are simply blowing smoke or committing false witness.

This was a good: "We can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by. Or we can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules. What’s at stake are not Democratic values or Republican values, but American values. We have to reclaim them." Excerpt for some of the rich and a few libertarians, this is how most Americans think of our country.

The notion that you caused our economic problems is ludicrous. "In the six months before I took office, we lost nearly four million jobs. And we lost another four million before our policies were in full effect." Have Republicans forgotten the eight years under Bush and what resulted?

"I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place. No, we will not go back to an economy weakened by outsourcing, bad debt, and phony financial profits. Tonight, I want to speak about how we move forward, and lay out a blueprint for an economy that’s built to last – an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values. This blueprint begins with American manufacturing." Sounds like a good blueprint to me. Republicans indeed want to return to the way it was....why would anyone want to do that?

About education, I hope you meant this: "To teach with creativity and passion; to stop teaching to the test". Living with a teacher, I can tell you that, right now, they have to teach to the test, and it's killing both their passion and creativity.

Your rule for regulations sound sensible: "Rules to prevent financial fraud, or toxic dumping, or faulty medical devices, don’t destroy the free market. They make the free market work better."

Toward the end of your speech, you included a beautiful thought: "Those of us who’ve been sent here to serve can learn from the service of our troops. When you put on that uniform, it doesn’t matter if you’re black or white; Asian or Latino; conservative or liberal; rich or poor; gay or straight. When you’re marching into battle, you look out for the person next to you, or the mission fails. When you’re in the thick of the fight, you rise or fall as one unit, serving one Nation, leaving no one behind."

"So it is with America. Each time I look at that flag, I’m reminded that our destiny is stitched together like those fifty stars and those thirteen stripes. No one built this country on their own. This Nation is great because we built it together. This Nation is great because we worked as a team. This Nation is great because we get each other’s backs. And if we hold fast to that truth, in this moment of trial, there is no challenge too great; no mission too hard. As long as we’re joined in common purpose, as long as we maintain our common resolve, our journey moves forward, our future is hopeful, and the state of our Union will always be strong."

Nicely done, Mr. President. You make me proud to be an American.

Mitt Romney Makes 263 Times What I Make--That's 26,300% More Than I Made--And Yet I Pay A 50% Higher Tax Rate

Poor Mitt.  How you have to grovel if you want to be President of the United States.

Normally, individual tax returns are private and confidential, and all we ever see are averages by income levels.  But now the whole world knows how much wealth and income the Romneys have, since he was shamed into releasing his 2010 tax return.

They received income of $21,000,000 dollars in 2010, and again in 2011.  Twenty one million.  In one year.  In retirement.

And they paid just under 14% in total federal taxes--both income and FICA.

So Warren Buffett is right...the wealthy do pay a significantly lower tax rate than most average people.

Take me, for example.  In 2009, I paid a comparable tax rate of 22%.  In other words, on income that was less than one third of one percent of what Romney made--he makes 263 times what I make--I paid a 50% higher tax rate.

So much for so-called 'progressive taxation'.  Our current tax system is highly regressive, at least for the super-wealthy who live off capital gains and dividends.

And if the Republicans--and so-called 'conservatives' in general--get their way, it's only going to get more regressive. 

Welcome to 'Class Warfare'.

$1.4 Million Per Month--Now THAT Is A Paycheck

You may recall that a few days ago, I estimated what Mitt Romney had as wealth and income, and what he paid in taxes.

The main number thrown around is that Mitt Romney is worth 250 million dollars. Let's be conservative and say that it's 200 million. And then let's speculate that he was able to make 5% return on that wealth last year, which I think is probably very conservative as well.

That would be $200 million x 5% equals $10 million annually. That's a monthly paycheck of $833,333.33. Four times a year he would be sending into the IRS a self-estimated tax payment of $375,000 (assuming 15% tax rate for him, which he just affirmed yesterday). That would leave a monthly net income of $708,333.00.

Well, the numbers have been released and indeed, I was being conservative. Here's what the Washington Post said this morning:

Mitt Romney offered a partial snapshot of his vast personal fortune late Monday, disclosing income of $21.7 million in 2010 and $20.9 million last year — virtually all of it profits, dividends or interest from investments.

The couple gave away $7 million in charitable contributions over the past two years, including at least $4.1 million to the Church of Jesus Christ of Latter-day Saints. Romney’s family has for generations been among the Mormon Church’s most prominent members.

The Romneys sent somewhat less to Washington over that period, paying an estimated $6.2 million in federal income taxes. According to his 2010 return, Romney paid about $3 million to the IRS, for an effective tax rate of 13.9 percent.

So it looks like Romney made a good return of about 10% on his investments of over $200 million. He gave something like 16% of his income to charity, including a tithe (10%) to his church, the Church of Jesus Christ of Latter Day Saints.  He paid about 14% in total federal taxes.  (By comparison, we paid about 22% of our joint income that year in total federal taxes--income and FICA.)

The Romneys took home (so to speak) about $1.4 million a month last year.  And he wasn't even working.  Somehow, as a consultant and private-equity manager for some 15 years in the 80s and 90s, he brought home enough bacon to retire for the rest of his life on $1.4 million a month.  And he doesn't even start drawing his Social Security check for another year yet....

What a country!  Over the last 30 years, using mostly other people's money (leverage), Romney and people like him have bought and sold companies, tinkering here and there, firing these workers, lowering those wages and benefits, eliminating that pension plan, outsourcing those jobs, taking those 'special dividends'.  And VOILA, all of a sudden, they're multi-millionares.  Where did their money come from?  Mostly lost wages, benefits, jobs on the part of all those middle-class workers who are, in many cases, no longer middle-class.

It's no wonder that Mitt Romney's uncomfortable when it comes to discussing his wealth, his income, and his taxes.  As he should be.  He's says he earned his money the old fashioned way.  Right--he basically stole it--from workers and their families, and from their communities. 

However, to his credit, he did tithe his filthy lucre (I Timothy 3:3) so we could be sure and have more Mormon missionaries in every corner of the world, passing out the Book of Mormon.  (Great.)

It was all 'legal', of course.  The finance and corporate elite made sure of that, through their political whores in Washington.  But that doesn't make it right.  In fact, it's all very unseeming, even obscene.  And the American people, increasingly, believe that is the case.

The inequity and unfairness of our current economy is a discussion that America needs to have, if we hope to somehow stay--or again become--a decent society.  How ironic, though, that we're having it in the midst of the Republican primaries.

Mitt Romney will stay rich, no doubt, as will his children and grandchildren, for generations to come.  But, it seems to me, he will not be President.

Romney's Waterloo?

Update:  Gingrich did win big in South Carolina tonight.  This changes things, I would say.  Romney is no longer the inevitable winner.  Newt could also take Florida next week.  Barring some unforeseen development, this is going to be a longgggggggggg spring for these four candidates.

Last night could possibly have been Mitt Romney's Waterloo.  Amazing.  A week ago, after apparently winning both Iowa and New Hampshire, Romney looked unbeatable, like Napoleon demolishing every army in his path.  But suddenly, in the course of several days, how things have changed....again.  In last night's CNN South Carolina debate, he was the least impressive and most superficial of the four Republican candidates.  His response to the question of his tax returns was halting, uncertain, embarrassed.  What's he trying to hide?  Probably how little taxes he pays on his incredible wealth.  Or maybe that he doesn't actually tithe to the Mormon Church?

Battle of Waterloo by William Sadler

Rick Santorum, the true underdog of this primary season,  actually came across this debate as having more gravitas than Gov. Romney.  Add to this the fact that he actually won the Iowa caucuses, that he was willing to seriously--albeit graciously--criticize the other candidates, and Santorum comes across as sincere, honest, and likeable.  He comes across as a little too zealous in his social conservativism to actually win, but in this environment, who knows what's going to happen?

Newt Gingrich, even with that shit-ass grin and huge girth, looked more confident and Presidential than Romney.  And with his angry response to the moderator's question about his ex-wife's charge about open marriage, he hit a home run.  Some say he won the debate in the first five minutes.  I think they're right.

It's looks increasingly likely that Newt Gingrich will win the South Carolina primary.  That makes Mitt Romney looks a lot less like the inevitable winner of this whole thing.  He's continues to have all the logistical and financial advantages, no doubt.  But Gingrich shouldn't be underestimated.  His rhetorical abilities and his uncanny talent at scratching exactly where the Republicans' itch can take him a long way.

I haven't mentioned Ron Paul yet, but only because little has changed with him.  He'll remain in the race to the convention, I think, and have his impact, pushing his libertarian convictions.

The Battle of the Republican Titans goes on!

$708,333: Mitt Romney's Monthly Paycheck (After Taxes).

Let's do a rough calculation, shall we, on how much Mitt Romney brought home in income last year and how much tax he paid.

The main number thrown around is that Mitt Romney is worth 250 million dollars.  Let's be conservative and say that it's 200 million.  And then let's speculate that he was able to make 5% return on that wealth last year, which I think is probably very conservative as well.

That would be $200 million x 5% equals $10 million annually.  That's a monthly paycheck of $833,333.33.  Four times a year he would be sending into the IRS a self-estimated tax payment of $375,000 (assuming 15% tax rate for him, which he just affirmed yesterday).  That would leave a monthly net income of $708,333.00.

So, in a month's time, Mitt takes home--from just investments alone, since he's not working now--about 288 times what my wife brings home from teaching her class of 3rd graders.  And he pays a lower tax rate than she does.  (And it's actually likely that he makes more than this, since I've been very conservative in my estimates here.)

Interesting.  How exactly would you go about spending $708,333 a month?  I'd love to see his family budget.

Update: Oh, and he made $374,000 in speaking fees last year.  "Not very much", he says.  Really.

Can we now conclude that, for him and people like him, there is no economic crisis in America?  Things are just FINE.

Top Ten Ways That The Rich Escape Paying Their Taxes

I wish I could give you a list of the "Top Ten Ways That The Rich Escape Paying Their Taxes", but I can't, at least not yet.  But surely included on that list would be the reason that Mitt Romney only pays 15% of his income in federal taxes, while most middle class folks pay more than that (adding together income tax and FICA tax).  Robert Reich explains how:

It's not how much Romney earns. Everyone knows he's comfortably in the top one-tenth of one percent.

It's how much he pays of it in taxes. Romney says he pays a tax rate of "about 15 percent."

That's lower than the tax rate most of America's middle class face and far lower than the 35 percent top rate after the Bush tax cut. (To put this in perspective, recall that the top income tax rate under Dwight Eisenhower was 91 percent.)

The real smoking gun is how Romney manages to pay only 15 percent on what's been his money-gusher of compensation from Bain Capital. Romney hasn't released his tax returns yet, but the most obvious answer is he treats his Bain income as capital gains -- subject to the current capital gains rate of only 15 percent.

A loophole in the tax laws allows private-equity managers like Romney to treat their compensation as capital gains. It's legal but it's a scandal. Income from employment is employment income, period.

Private-equity managers cling to the technicality that the money they take out of their companies comes from the appreciation of assets they own and sell. That may be true, but it's still income they get from their jobs. Common sense would dictate it be treated as ordinary income.

Congress has vowed for years to close this loophole. But somehow it persists. Even when Democrats have been in charge, they haven't been able to close it.

Guess why. The managers and executives of private-equity funds are big donors to Republicans and Democrats alike.

President Obama as Patient 'Moderate Liberal'

Andrew Sullivan makes a persuasive case that Barack Obama is a moderate liberal who plays a political 'long-game':

What liberals have never understood about Obama is that he practices a show-don’t-tell, long-game form of domestic politics. What matters to him is what he can get done, not what he can immediately take credit for. And so I railed against him for the better part of two years for dragging his feet on gay issues. But what he was doing was getting his Republican defense secretary and the chairman of the Joint Chiefs to move before he did. The man who made the case for repeal of “don’t ask, don’t tell” was, in the end, Adm. Mike Mullen. This took time—as did his painstaking change in the rule barring HIV-positive immigrants and tourists—but the slow and deliberate and unprovocative manner in which it was accomplished made the changes more durable. Not for the first time, I realized that to understand Obama, you have to take the long view. Because he does.

Or take the issue of the banks. Liberals have derided him as a captive of Wall Street, of being railroaded by Larry Summers and Tim Geithner into a too-passive response to the recklessness of the major U.S. banks. But it’s worth recalling that at the start of 2009, any responsible president’s priority would have been stabilization of the financial system, not the exacting of revenge. Obama was not elected, despite liberal fantasies, to be a left-wing crusader. He was elected as a pragmatic, unifying reformist who would be more responsible than Bush.

And what have we seen? A recurring pattern. To use the terms Obama first employed in his inaugural address: the president begins by extending a hand to his opponents; when they respond by raising a fist, he demonstrates that they are the source of the problem; then, finally, he moves to his preferred position of moderate liberalism and fights for it without being effectively tarred as an ideologue or a divider. This kind of strategy takes time. And it means there are long stretches when Obama seems incapable of defending himself, or willing to let others to define him, or simply weak. I remember those stretches during the campaign against Hillary Clinton. I also remember whose strategy won out in the end.

This is where the left is truly deluded. By misunderstanding Obama’s strategy and temperament and persistence, by grandstanding on one issue after another, by projecting unrealistic fantasies onto a candidate who never pledged a liberal revolution, they have failed to notice that from the very beginning, Obama was playing a long game. He did this with his own party over health-care reform. He has done it with the Republicans over the debt. He has done it with the Israeli government over stopping the settlements on the West Bank—and with the Iranian regime, by not playing into their hands during the Green Revolution, even as they gunned innocents down in the streets. Nothing in his first term—including the complicated multiyear rollout of universal health care—can be understood if you do not realize that Obama was always planning for eight years, not four. And if he is reelected, he will have won a battle more important than 2008: for it will be a mandate for an eight-year shift away from the excesses of inequality, overreach abroad, and reckless deficit spending of the last three decades. It will recapitalize him to entrench what he has done already and make it irreversible.

I'm not completely persuaded, but I'm keeping an open mind. Furthermore, what Sullivan calls 'moderate liberalism' may really be just Clintonian/Rubinian 'neo-liberalism', which I think has shown itself to be quite flawed, especially in its acceptance of laissez-faire, deregularized, delaborized economics.  Yet, I will agree with Sullivan that even Obama's moderate liberalism is far better than the crazy right-wing politics found in the Republican Party these days.

Obama's Foreign Policy: Responsible Realism

President Obama, far from being the appeaser that the Republicans are trying to paint him as, has been quietly effective in pursuing America's true national interests abroad, as the foreign policy centrist and realist that he is. Andrew Sullivan, in his frontpage Newsweek story, describes it well:

On foreign policy, the right-wing critiques have been the most unhinged. Romney accuses the president of apologizing for America, and others all but accuse him of treason and appeasement. Instead, Obama reversed Bush’s policy of ignoring Osama bin Laden, immediately setting a course that eventually led to his capture and death. And when the moment for decision came, the president overruled both his secretary of state and vice president in ordering the riskiest—but most ambitious—plan on the table. He even personally ordered the extra helicopters that saved the mission. It was a triumph, not only in killing America’s primary global enemy, but in getting a massive trove of intelligence to undermine al Qaeda even further. If George Bush had taken out bin Laden, wiped out al Qaeda’s leadership, and gathered a treasure trove of real intelligence by a daring raid, he’d be on Mount Rushmore by now. But where Bush talked tough and acted counterproductively, Obama has simply, quietly, relentlessly decimated our real enemies, while winning the broader propaganda war. Since he took office, al Qaeda’s popularity in the Muslim world has plummeted.

Obama’s foreign policy, like Dwight Eisenhower’s or George H.W. Bush’s, eschews short-term political hits for long-term strategic advantage. It is forged by someone interested in advancing American interests—not asserting an ideology and enforcing it regardless of the consequences by force of arms. By hanging back a little, by “leading from behind” in Libya and elsewhere, Obama has made other countries actively seek America’s help and reappreciate our role. As an antidote to the bad feelings of the Iraq War, it has worked close to perfectly.

Obamacare: Not Socialist at All

Andrew Sullivan makes the case that Obamacare is a conservative policy initiative:

The great conservative bugaboo, Obamacare, is also far more moderate than its critics have claimed. The Congressional Budget Office has projected it will reduce the deficit, not increase it dramatically, as Bush’s unfunded Medicare Prescription Drug benefit did. It is based on the individual mandate, an idea pioneered by the archconservative Heritage Foundation, Newt Gingrich, and, of course, Mitt Romney, in the past. It does not have a public option; it gives a huge new client base to the drug and insurance companies; its health-insurance exchanges were also pioneered by the right. It’s to the right of the Clintons’ monstrosity in 1993, and remarkably similar to Nixon’s 1974 proposal. Its passage did not preempt recovery efforts; it followed them. It needs improvement in many ways, but the administration is open to further reform and has agreed to allow states to experiment in different ways to achieve the same result. It is not, as Romney insists, a one-model, top-down prescription. Like Obama’s Race to the Top education initiative, it sets standards, grants incentives, and then allows individual states to experiment. Embedded in it are also a slew of cost-reduction pilot schemes to slow health-care spending. Yes, it crosses the Rubicon of universal access to private health care. But since federal law mandates that hospitals accept all emergency-room cases requiring treatment anyway, we already obey that socialist principle—but in the most inefficient way possible. Making 44 million current free-riders pay into the system is not fiscally reckless; it is fiscally prudent. It is, dare I say it, conservative.

Vulture Capitalism à la Bain Capital

This Republican primary season has been full of surprises, everything from the number of debates to the rise and fall of numerous frontrunners.  But the single most surprising development is the recent debate over the issue of wealth and income equality in America, along with the related issue of 'vulture capitalism'.  Who would ever have thought that Bain Capital's corporate morality or the income tax returns of Mitt Romney would be at issue in this most laissez-faire political party?

I'll let veteran left-wing journalist and activist Katrina vanden Heuvel describe it in the WaPo:

If you had asked me at the beginning of the Republican nomination fight what candidates like Newt Gingrich and Rick Perry would say to win, I would have said just about anything. What I couldn’t possibly imagine was that one of the things they might start saying would actually be the unvarnished, unblinking, stand-up-and-clap-for-it truth.

With their eyes set on Bain’s bane and Mitt Romney’s career, Perry and Gingrich have been astonishingly and appropriately brutal. “There’s a real difference between venture capitalism and vulture capitalism,” Perry told Fox and Friends last week. “I don’t believe that capitalism is making a buck under any circumstances.” Couldn’t have said it better myself.

Gingrich sharpened that point further on Bloomberg.“The question is whether or not these companies were being manipulated by the guys who invest to drain them of their money, leaving behind people who were unemployed,” he said. “Show me somebody who has consistently made money while losing money for workers and I’ll show you someone who has undermined capitalism.” Sing it, Brother Gingrich.

Though it might be odd that such attacks on Romney have originated with Republicans themselves, that they have sparked a national conversation matters a great deal. It allows those who’ve been making the case for years to drive home the critical point that the work of people like Romney is not the stuff of natural free markets; it is the product of a well-funded construct of laws and rules and institutions and values that undermine shared prosperity in a country that once took pride in supporting upward mobility.

Sounds like 'class warfare' has come to the Republican Party itself as a civil war.