Super rich pay no taxes

reply to post by hawkiye


How many depressions did we have in the 1890ties? These problems weren't just regional.

The Mises Institute puts out pure propaganda.

Here is a link on the depressions of the 1890s.

projects.vassar.edu...

reply to post by poet1b

Hi again,

I shouldn't have been away from the thread for so long, I've missed a lot of the fireworks and can't get caught up now, there's just to much. Mind if I just look at your last post? I think you've noticed something that could use a little more exploration.

The housing boom was created by bundling bad loans and rating them as good.

I know that if I went to a bank and proposed a loan of $50,000 for a new supercar, they would turn me down. Looking at all the different factors they would say "That would be a bad loan." They would know it and everybody else would know it.

So, why then would the banks make bad loans for other objects that could be reposessed, such as houses? As with my car loan, they would turn it down, unless they had to make the loan.

The government originally had an idea with the good purpose of putting more people into their own home, and making sure there was no racial discrimination in granting loans. Unfortunately, we know what happened. The banks were told they had to make home loans they didn't want to make. They knew the loans were bad, everybody knew the loans were bad. And the banks wanted to get rid of them as quickly as they could, they didn't want to be stuck with a bunch of defaulted loans, so, they sold them. But they couldn't get 100% of the value so they had to settle for 50, 60, 70% of the value. These were sold on and on with everybody hoping they could get rid of these government ordered loans before the whole thing fell apart. And fall apart it did.

These boom bust cycles are the failure of the Fed Gov to enforce laws against corrupt business practices.

That's an interesting theory. Would you explain with a little more specificity? Many economists believe there is a natural "business cycle," with peaks and valleys that may become amplified for various reasons. The violation of which law created our last three or four economic cycles? My first impression is that that is an effect far too great for the supposed cause.

- C -

Originally posted by poet1b
reply to post by hawkiye

 

How many depressions did we have in the 1890ties? These problems weren't just regional.

The Mises Institute puts out pure propaganda.

Here is a link on the depressions of the 1890s.

projects.vassar.edu...

The government was the very cause to that depression! If you read up on what lead to it you will see that it was triggered by heavy westward expansion namely the railroad industry. The railroad industry was heavily subsidized by government during this period. The government once again got involved in the market and began to subsidize certain railroad companies. The companies which were subsidized by government built very inefficient railroad since they were being paid by the mile. This lead to horrible misuse of capital and an inability to pay back government dept. This market interference is what led to the 1890 depression. It was the necessary correction of the malinvesment.

"The Panic of 1893 was a serious economic depression in the United States that began in 1893. Similar to the Panic of 1873, this panic was marked by the collapse of railroad overbuilding and shaky railroad financing which set off a series of bank failures. Compounding market overbuilding and the railroad bubble, was a run on the gold supply. The Panic of '93 was the worst economic depression the United States had ever experienced at the time."

en.wikipedia.org...

reply to post by charles1952


What nonsense. Those banks weren't forced to make those loans. They made those loans because they knew they could get those bad loans rated as good loans and sell them to investors. It was a scam.

reply to post by poet1b


Its was the government that made the loans! It was government subsidizing the railroads that created the bad investment. The government made the loans in the forms of bonds. It was not banks!

en.wikipedia.org...

reply to post by crankySamurai


The link you provide does not back up your claims about governments involvement creating the failures.

Government has always been involved in business. And the US gov has been involved since its conception.

Oh, and the failures of railroads to build quality lines infers failure of government to enforce quality standards, or in other words, lack of regulation.

reply to post by charles1952


My local bank did indeed refuse car loans to some people, just as they refused home loans, too. A car loan is different than a mortgage. A car loan is calculated differently, with the promise to repay the loan in full, in a much shorter time than home loan. True, the loan holder might be able to repossess the car, but they would end up with a much depreciated product, and I would still be responsible to pay off the loan.

The home mortgage gives the lender an interest in the property. Just in my town, home mortgage lenders/brokers sprang up like weeds. They sold mortgages to just about anybody, using "creative financing" if necessary. (The mortgages could then be sold to investors.) One young couple I know was given an interest only mortgage, so their payment would be lower, so they could "buy" a house .

Originally posted by poet1b
reply to post by crankySamurai

 

The link you provide does not back up your claims about governments involvement creating the failures.

Government has always been involved in business. And the US gov has been involved since its conception.

Oh, and the failures of railroads to build quality lines infers failure of government to enforce quality standards, or in other words, lack of regulation.

Here ill point it out to you:

"The construction and operation of the line was authorized by the Pacific Railroad Acts of 1862 and 1864 during the American Civil War. Congress supported it with 30-year U.S. government bonds and extensive land grants of government-owned land."

Originally posted by poet1b
m.yahoo.com...=AjS2S_4pemxJ5zHBre0oAc2x.tw4%3B_ylu=X3o'___'I2MzBmdGgxBGNjb2RlA3lyZARjcG9zAzQEY3 NlYwNtb2JpbGUtdGQEaW50bAN1cwRwa2cDaWQtMjU2MTY0NARwb3MDNARzbGsDaW1hZ2U-?ref_w=frontdoors&view=today&.intl=us&.lang=en&.tyahoo

It so happens that this summer the Internal Revenue Service released data from the 400 individual income tax returns reporting the highest adjusted gross income. This elite ultrarich group earned on average $202 million in 2009, the latest year available. And buried in the data is the startling disclosure that six of the 400 paid no federal income tax.

I Don't know if the long link will work, the original article came from the NY Times.

After the massive Wall Street bailout, that these super rich parasites can continue to rob future generations is a terrible crime.

It is clear that the only thing tax cuts for the super rich produce is more fraudulent business practices. It is like giving heroine to a heroine addict.

Bogus. Obama stole over 5 trillion from the children of the future and gave it to the banks. That's 5 trillion. The rich on the other hand pay most of all the taxes paid in the United States. I hope to be rich someday. Success, is not a bad thing, it's a good thing. Stealing on the other hand is a very bad thing.

Originally posted by poet1b
reply to post by crankySamurai

 

Government has always been involved in business. And the US gov has been involved since its conception.

Oh, and the failures of railroads to build quality lines infers failure of government to enforce quality standards, or in other words, lack of regulation.

The railroads where build poorly not because of a lack government regulations at all. It is not the governments job to make sure that a business is run efficiently or wisely or innovatively. That is the sole responsibility of the business owner. The government cant regulate you to success.

The government gave those railroad owners incentive to build poorly since they were given money buy the mile. The loans also where free of interest to there was no frugality to the amount borrowed. If they would of been at market price then they those companies would not of been able to get them and would of had to wait until someone competent came along and could build the railroads without handouts buy their buddies in washington.

reply to post by Fromabove


Those huge deficits were obligated before Obama ever took office.

It's quite clear you worship wealth and are willing to over look anything that rich people do, eve when it is against your own best interests.

How smart is that?

reply to post by crankySamurai


Wow, you know nothing about business. As the lender, the fed gov should have most certainly made sure the work was being carried out properly.

Like I said, lack of regulation.

reply to post by poet1b


Are you able to talk without spewing out insults? What you are advocating is for government to be able to take peoples money by taxation and invest it were they see fit.

I say that this leads to corruption and an economic system like the one we have.

When government is able to invest peoples money it spends it on its friend (those people who buy the politicians). What you are advocating is the system where politicians are able to choose who gets wealthier not by their ability but by their political pull.

reply to post by crankySamurai


I thought you were pretty harsh yourself, your false claim a clear shot aimed at those you disagree with.

The rest of this post is pretty good. My goal is to eliminate governments ability to take what they want and dole it out to who they choose.

I think government taxation should be based on where those tax incomes are to be spent.

I think the rich get far more out than what they put in, while the middle class pays far more in than they get back out.

Originally posted by poet1b
reply to post by charles1952

 

What nonsense. Those banks weren't forced to make those loans. They made those loans because they knew they could get those bad loans rated as good loans and sell them to investors. It was a scam.

This is a good read for anyone still believing the nonsense Fannie and Freddie Fantasies

The average American, the common man, being good and decent, cannot begin to understand the financial scams and corruption in America.

Originally posted by poet1b
reply to post by crankySamurai

 

I thought you were pretty harsh yourself, your false claim a clear shot aimed at those you disagree with.

The rest of this post is pretty good. My goal is to eliminate governments ability to take what they want and dole it out to who they choose.

I think government taxation should be based on where those tax incomes are to be spent.

I think the rich get far more out than what they put in, while the middle class pays far more in than they get back out.

edit on 3-9-2012 by poet1b because: Typo

Alright but that was not a false claim. The government did subsidize railroad companies during that time and the majority of those they gave money to created poor railroads and spent more than they made.

"In 1861 Curtis again introduced a bill to establish the railroad, but it did not pass. After the secession of the southern states, the House of Representatives on May 6, 1862, and the Senate on June 20 finally approved it. Lincoln signed it into law on July 1. The act established the two main lines—the Central Pacific from the west and the Union Pacific from the mid-west. Other rail lines were encouraged to build feeder lines.

Each was required to build only 50 miles (80 km) in the first year; after that, only 50 miles (80 km) more were required each year. Each railroad received $16,000 per mile ($9,940/km) built over an easy grade, $32,000 per mile ($19,880/km) in the high plains, and $48,000 per mile ($29,830/km) in the mountains."

Same source, wiki.

I agree that government distribution of wealth is not equal but I also think that its not governments role to be in control of so much money. When a government has control over such huge quantities of money the result will always be people fighting over who gets what.

Thats why I disagree with a central bank.

reply to post by desert


Great link. Thanks

And well put commentary.

reply to post by desert

Dear desert,

Thank you for supplying the link. It is a lengthy and difficult read. I've tried it twice, and I promise to take one more shot at it. It must be that I've been out of school for too long. Anyway I take my hat off to you, and pledge to be your servant for life in acknowledgment of an intellect that goes far beyond mine.

May I offer you a return article? I like it just a bit better than yours for a couple of reasons. It contains links to the author's several articles on why he believes the Community Reinvestment Act led us into risky housing lending, but it also links to the works of people who disagree with him, that's a huge plus for me.

The main part of his article is a question and answer format for exploring the criticisms and defenses of his position. It is written in fairly clear, mostly non-technical English, and provides a broad overview of the questions involved. articles.businessinsider.com...

I promise to take another shot at yours.

With respect,
Charles1952

P.s. HEY, POET1B I'm glad you enjoyed her link. As you can see, I'm having trouble with it. Would you mind giving me two or three paragraphs on why you like it and what principles and theories you got from it? Thanks.
- C -

Originally posted by poet1b
reply to post by hawkiye

 

How many depressions did we have in the 1890ties? These problems weren't just regional.

The Mises Institute puts out pure propaganda.

Here is a link on the depressions of the 1890s.

projects.vassar.edu...

This is a joke link right? The so called panic of 1890 lasted about 3 years and as due to a push for central/national banking and a lot of fiat money replacing gold receipts. The New York subtreasury changed a longstanding practice of settling its clearinghouse balances in gold. Instead around August 1890, it started using the old greenbacks and the newer treasury notes of 1890 ( the national banking act was successful and a precursor to the Federal Reserve Act). As a result, these paper currencies largely replaced gold paid in customs receipts for foreign and other investment in New York. See Friedman and Schwartz, Monetary History, pp. 106, n. 25.

It was nothing like the great depression and very limited to the big cities. the GDP still increased wages rose and production still increased despite the inflation and prices falling. Even the Keynesians who wrongly call this a depression will tell you it was nothing like the great depression.

Along with the establishment of a national bank There was also a push at monoplizing industry and

"During the 1890s, in the new field of large-scale
industrial corporations, big-business interests tried to establish
high prices and reduced production via mergers, and again, in
every case, the mergers collapsed from the winds of new com-
petition. In both sets of cartel attempts, J.P. Morgan and Com-
pany had taken the lead, and in both sets of cases, the market,
hampered though it was by high protective tariff walls, man-
aged to nullify these attempts at voluntary cartelization...

It then became clear to these big-business interests that the
only way to establish a cartelized economy, an economy that
would ensure their continued economic dominance and high
profits, would be to use the powers of government to establish
and maintain cartels by coercion. In other words, to transform
the economy from roughly laissez-faire to centralized and coor-
dinated statism."
A history of Money and Banking. Rothbard pgs 185

So once again we have government intervention causing the problems. Still they were a sunday picnic compared to the Great Depression and the recessions we have had since.

Orthodox economic historians have long complained about
the “great depression” that is supposed to have struck the
United States in the panic of 1873 and lasted for an unprece-
dented six years, until 1879. Much of this stagnation is sup-
posed to have been caused by a monetary contraction leading to
the resumption of specie payments in 1879. Yet what sort of
“depression” is it which saw an extraordinarily large expansion
of industry, of railroads, of physical output, of net national
product, or real per capita income? As Friedman and Schwartz
admit, the decade from 1869 to 1879 saw a 3-percent-per-
annum increase in money national product, an outstanding
real national product growth of 6.8 percent per year in this
period, and a phenomenal rise of 4.5 percent per year in real
product per capita. Even the alleged “monetary contraction”
never took place, the money supply increasing by 2.7 percent
per year in this period. From 1873 through 1878, before
another spurt of monetary expansion, the total supply of bank
money rose from $1.964 billion to $2.221 billion—a rise of 13.1
percent or 2.6 percent per year. In short, a modest but definite
rise, and scarcely a contraction.
It should be clear, then, that the “great depression” of the 1870s
is merely a myth—a myth brought about by misinterpretation of
the fact that prices in general fell sharply during the entire
period. Indeed they fell from the end of the Civil War until 1879.
Friedman and Schwartz estimated that prices in general fell
from 1869 to 1879 by 3.8 percent per annum. Unfortunately,
most historians and economists are conditioned to believe that
steadily and sharply falling prices must result in depression:
hence their amazement at the obvious prosperity and economic
growth during this era. For they have overlooked the fact that
in the natural course of events, when government and the bank-
ing system do not increase the money supply very rapidly, free-
market capitalism will result in an increase of production and
economic growth so great as to swamp the increase of money
supply. Prices will fall, and the consequences will be not depres-
sion or stagnation, but prosperity (since costs are falling, too)
economic growth, and the spread of the increased living stan-
dard to all the consumers."

see Milton
Friedman and Anna Jacobson Schwartz, A Monetary History of the
United States, 1867–1960 (New York: National Bureau of Economic
Research, 1963), pp.33–44. On totals of bank money, see Historical
Statistics, pp. 624–25.
146S.B. Saul, The Myth of the Great Depression, 1873–1896 (London:
Macmillan, 1969).

reply to post by desert


Did Fannie and Freddie Cause the Mortgage Crisis? By Kimberly Amadeo,

Short answer: Nope.