Tuesday, August 14, 2012

Altruism as Evil

Those of us in an ideology free zone are often amazed by our ideological brethren. The amazement is caused by their remarkable ability to embrace belief systems that are utterly contradictory. Paul Ryan is a devout Catholic and a disciple of Ayn Rand. If you have even the slimmest understanding of those two philosophies, this should make your head throb. It is as if a celibate pacifist celebrated the life and times of the Marquis de Sade.
But then, Ayn Rand, the individualist who wanted to dismantle government programs, gratefully embraced the collectivist wonder of Medicare when her health failed.
Paul Ryan is considered an "intellectual" in the conservative movement. In a land of the blind, a one eyed man can be king.
This land is your land.

"People don't generally care what politicians read. But Rep. Paul Ryan is different. His fascination with the Russian-born novelist Ayn Rand could spell trouble for the GOP's new vice-presidential candidate. It could put him at odds with the Christian right and the Roman Catholic Church.
It all depends how much you believe that he is in the thrall of Ayn Rand.
Rand (1905-1982) is controversial because of the extremism of her views. In researching my recent book, I found that Rand's influence on the Republican Party, which dates back as far as her endorsement of Wendell Willkie in 1940, has been sharply growing, largely due to her vise-like hold on the imagination of the tea party and people like Ryan.
Rand was the author of two best-selling novels, "The Fountainhead" and "Atlas Shrugged." These books, along with her other novels and essays, set forth an ideology which she called objectivism. ...
College students notoriously go through an "Ayn Rand phase" because her books emphasize self-reliance and breaking away from one's parents. For most people, it's a kind of literary infatuation. But for a few, Rand becomes a lifelong passion.
What made her books controversial is not violence or sex, though both "Fountainhead" and "Atlas" have their share of bodice-ripping, but an extremist vision of America that celebrated greed and selfishness, rejected altruism as "evil" and opposed the fundamental tenets of Judeo-Christian morality. (She was also a militant atheist who favored abortion.)"

Friday, August 10, 2012

The 100 Million Dollar Question

Mitt Romney somehow accumulated 100 million dollars in non-taxed, IRA funds over the past twenty years. The absolute maximum that you can put in such funds is $30K per year. Since Romney isn't several hundred years old, he had to accumulate this astonishing tax hedge in some other fashion. 

I wish I knew Romney's secret. A little simple math suggests that, if I could come up with only $3k  a year, after 20 years I would have 10 million dollars. If Mitt can show how we all can do this, I will not only vote for him, I will volunteer for his campaign.

Tax experts are scratching their heads over this and other Romney financial matters. The conventional wisdom is that he hasn't released his previous tax returns because the answers to his tax mysteries are much, much worse than hiding them from the voting public.

"Mitt Romney is extraordinarily wealthy, but that is not a justification for nondisclosure. He has made no secret of his wealth, and required campaign disclosures already hint at its magnitude. While Romney may have dissembled about when he actually left Bain Capital, he has been disassociated with the firm long enough that he cannot argue that his tax returns will reveal proprietary secrets.
Nor is this just an exercise in financial titillation or gossip. Disclosure goes to the heart of the truthfulness with which a nominee engages the American people, and it assures us that he in fact has comported himself before the election with the high moral character we associate with a future president.
Romney's 2010 tax return, when combined with his FEC disclosure, reveals red flags that raise serious tax compliance questions with respect to his possible tax minimization strategies in earlier years. The release in October of his 2011 return will at best act as a distraction from these questions.
So, what are the issues?
The first is Romney's Swiss bank account. Most presidential candidates don't think it appropriate to bet that the U.S. dollar will lose value by speculating in Swiss Francs, which is basically the rationale offered by the trustee of Romney's "blind" trust for opening this account. What's more, if you really want just to speculate on foreign currencies, you don't need a Swiss bank account to do so.
The Swiss bank account raises tax compliance questions, too.
The account seems to have been closed early in 2010, but was the income in fact reported on earlier tax returns? Did the Romneys timely file the required disclosure forms to the Treasury Department (so-called FBAR reports)?
The IRS announced in 2009 a partial tax amnesty for unreported foreign bank accounts, in light of the Justice Department's criminal investigations involving several Swiss banks. To date, some 34,500 Americans have taken advantage of such amnesty programs. Did the Romneys avail themselves of any of these amnesty programs? One hopes that such a suggestion is preposterous, but that is what disclosure is for -- to replace speculation with truth-telling to the American people.
Second, Romney's $100 million IRA is remarkable in its size. Even under the most generous assumptions, Romney would have been restricted to annual contributions of $30,000 while he worked at Bain. How does this grow to $100 million?
One possibility is that a truly mighty oak sprang up virtually overnight from relatively tiny annual acorns because of the unprecedented prescience of every one of Romney's investment choices.
Another, which on its face is quite plausible, is that Romney stuffed far more into his retirement plans each year than the maximum allowed by law by claiming that the stock of the Bain company deals that the retirement plan acquired had only a nominal value. He presumably would have done so by relying on a special IRS "safe harbor" rule relating to the taxation of a service partner's receipt of such interests, but that rule emphatically does not apply to an interest when sold to a retirement plan, which is supposed to be measured by its true fair market value.
Third, the vast amounts in Romney's family trusts raise a parallel question: Did Romney report and pay gift tax on the funding of these trusts or did he claim similarly unreasonable valuations, which likewise would have exposed him to serious penalties if all the facts were known?
Fourth, the complexity of Romney's one publicly released tax return, with all its foreign accounts, trusts, corporations and partnerships, leaves even experts (including us) scratching their heads. Disclosure of multiple years' tax returns is part of the answer here, but in this case it isn't sufficient. Romney's financial affairs are so arcane, so opaque and so tied up in his continuing income from Bain Capital that more is needed, including an explanation of the $100 million IRA.
Finally, there's the puzzle of the Romneys' extraordinarily low effective tax rate.
For 2010, the Romneys enjoyed a federal tax rate of only 13.9% on their adjusted gross income of roughly $22 million, which gave them a lower federal tax burden (including payroll, income and excise taxes) than the average American wage-earning family in the $40,000 to $50,000 range. The principal reason for this munificently low tax rate is that much of Romney's income, even today, comes from "carried interest," which is just the jargon used by the private equity industry for compensation received for managing other people's money."

Growing Jobs in China

Mitt Romney is a remarkable fellow. He wants to be president, and to be president he must tell working class people that his policies will grow jobs in America, allowing them to participate in the American dream. Yet his personal wealth was built from a business model that sends jobs overseas.

This dissonance, rather than giving him pause, seems to be consistent with the alternate universe he lives in. He nurtures job growth, the only problem is that it is on another continent.

"The shock of losing a precious job in a town afflicted by high unemployment is always hard. A foundation for a stable family life and secure home instantly disappears, replaced with a future filled with fears over health insurance, missed mortgage payments and the potential for a slip below the breadline.
But for Bonnie Borman – and 170 other men and women in Freeport,Illinois – there is a brutal twist to the torture. Borman, 52, and the other workers of a soon-to-be-shuttered car parts plant are personally training the Chinese workers who will replace them.
It’s a surreal experience, they say. For months they have watched their plant being dismantled and shipped to China, piece by piece, as they show teams of Chinese workers how to do the jobs they have dedicated their lives to.
“It’s not easy to get up in the morning, training them to do your job so that you can be made unemployed,” said Borman, pictured, a mother of three who has worked for 23 years at the Sensata auto sensors plant.
Borman knows her eventual fate in the stricken economy that surrounds Freeport. “I am going to be competing for minimum wage jobs with my own daughter,” she said.
Such scenes have been common in America as manufacturing has fled abroad in search of cheaper wages.
But, in the midst of the 2012 presidential election, Freeport is different. For Sensata is majority-owned by Bain Capital, the private equity firm once led by Mitt Romney, that has become a hugely controversial symbol of how the modern globalised American economy works. Indeed, Romney still owns millions of dollars of shares in the Bain funds that own Sensata.
So as Sensata strips out costs by sacking American workers in favour of Chinese ones, the value of Romney’s own investments could rise, putting money into the pockets of a Republican challenger who has placed job creation in America at the heart of his bid for the White House."

Monday, July 23, 2012

The .001 Percent

A sum of money larger than the entire U.S. economy, between 21 and 32 trillion dollars, is being held in tax-sheltered, off-shore accounts - much of it by a mere 92,000 people - or less than .001 percent of the world's population.

Let's be clear. This, not a few protestors in a New York park, is what constitutes class warfare.

These 92,000 people, who include presidential candidate Mitt Romney, have pledged their allegiance, not to a country, but to their money, revealing themselves as being less patriotic in regards to their country of origin than they are to their wealth.

Spare me the flag waving, flag lapel pin, "ours is the greatest country in the world" theatrics. We know where these folks passions lie, and it isn't with their country.

Report: $21 trillion hidden from taxman in offshore accounts

Some $10 trillion comes from just 92,000 people scattered around the globe.

The wealthiest people in the world have exploited loopholes in international tax rules, evading the taxman and sheltering a staggering $21 trillion or more in offshore accounts, according to a report released Sunday.
To give perspective to the scale of the offshore economy, the economic transparency group Tax Justice Network said the sum is larger than the entire United State’s economy, or enough money to entirely solve the European debt crisis.
The report, called The Price of Offshore Revisted, says between $21 trillion and $32 trillion could be hidden in tax havens in countries like Switzerland and the Cayman Islands. The first details of the report were released to the Observer in London.
And most of the money hidden overseas comes from people who would make the was majority of the top 1 percent turn green with envy, economists said.
Instead, some $10 trillion that has been stashed in off-shore accounts is owned by only 92,000 people, or 0.001 percent of the world's population, the report finds.
"These estimates reveal a staggering failure: inequality is much, much worse than official statistics show,” said John Christensen of the Tax Justice Network. "People on the street have no illusions about how unfair the situation has become."
Private banks and investment firms have enabled these wealthy individuals and corporations to take advantage of loopholes and gaps in cross-border tax rules, according to the report.
Questions about offshore accounts and tax shelters has recently become a major point of contention in the U.S. presidential campaign, with Democrats accusing Republican candidate Mitt Romney of stashing some of his wealth in offshore banks to avoid taxes.
The Romney campaign dismissed the allegations as an "unfounded character assault."
According to the Tax Justice Network report, almost every country has suffered from the billions of dollars in lost tax revenue, But, it says sub-Saharan Africa and oil producing states like Saudi Arabia have been especially hard hit. In some cases, the total worth of these hidden assets far exceeds the international debts owed by these countries.
The report was compiled using thousands of pieces data and sources, including information from the IMF, the Tax Justice Network said.

Read more:         http://www.nydailynews.com/news/world/report-21-trillion-hidden-taxman-offshore-accounts-article-1.1119613#ixzz21UM3Ltr2

Quantum Physics and God

"Does Quantum Physics Make it Easier to Believe in God?

Not in any direct way. That is, it doesn’t provide an argument for the existence of God.  But it does so indirectly, by providing an argument against the philosophy called materialism (or “physicalism”), which is the main intellectual opponent of belief in God in today’s world. 
Materialism is an atheistic philosophy that says that all of reality is reducible to matter and its interactions. It has gained ground because many people think that it’s supported by science. They think that physics has shown the material world to be a closed system of cause and effect, sealed off from the influence of any non-physical realities --- if any there be. Since our minds and thoughts obviously do affect the physical world, it would follow that they are themselves merely physical phenomena. No room for a spiritual soul or free will: for materialists we are just “machines made of meat.”  
Quantum mechanics, however, throws a monkey wrench into this simple mechanical view of things.  No less a figure than Eugene Wigner, a Nobel Prize winner in physics, claimed that materialism --- at least with regard to the human mind --- is not “logically consistent with present quantum mechanics.” And on the basis of quantum mechanics, Sir Rudolf Peierls, another great 20th-century physicist, said, “the premise that you can describe in terms of physics the whole function of a human being ... including [his] knowledge, and [his] consciousness, is untenable. There is still something missing.” 
 "If the human mind transcends matter to some extent, could there not exist minds that transcend the physical universe altogether? And might there not even exist an ultimate Mind?"

Read more:      Quantum Physics and God        Stephen M. Barr

Thursday, July 12, 2012

The Latest Sucker

I am simply perplexed by Wall Street and the large multi-national banks ability to continue to operate with impunity. Yes, there is an occasional fine, a regulatory slap on the wrists, and every so often a minion gets a brief jail sentence. These things are a minor expense, along the lines of sundries and incidentals, noted in a column in a spreadsheet marked "cost of business". The guys that run the operation are untouchable, retaining vast wealth and never, ever going to jail.

But every few months we find out that the system they inhabit (regulated in the most part by retainers and ex-employees) has been gamed in a new way, their clients wallets pilfered, the tax payer pummeled. There follows a few headlines on page two of the business section, and the people responsible go back to business as usual, generating vast wealth for themselves and their firms, living lives that would have shamed Rockefeller.

The latest scandal has revealed that they manipulated a key element of global interests rates for their own benefit - and to their clients detriment.

An ongoing trial has further exposed how Wall Street operates. They identify a situation, often involving tax payer funding, where huge amounts of money is changing hands, and insert themselves into the transaction in such a way as to lighten the taxpayers load. But that is never enough. They subvert the system to make a little more, crossing over into criminal behavior. 

I can only figure that key elements of our economic structure are rigged so that institutions are forced to go to Wall Street to engage in vital financial exercises. Given Wall Street's record, I can't imagine why any institution would go to them otherwise.

"When it comes to Wall Street scandals these days you can pretty much bet who the biggest loser will be: Your hometown.
The recent Libor fiasco is no different. The banks' alleged manipulation of the key benchmark interest rate may have cost municipalities, hospitals and other large non-profits as much as $600 million a year, according to one expert."

"this is what Wall Street learned from the Mafia: how to reach into the penny jars of dying hospitals and schools and transform their desperation and civic panic into fat year-end bonuses and the occasional "big lunch." Unlike the Mafia, though, they were smart enough to do their dirt without anyone noticing for a very long time, which is what defense counsel in this case were talking about when they argued that towns and cities "were not harmed" by the rigged bids. No harm, to them, means no visible harm, i.e., that what taxpayers didn't know couldn't hurt them. This is logical thinking, to the sociopath – like saying it's not infidelity if your wife never finds out. But we did find out, and the scale of betrayal unveiled in Carollo was epic. It was like finding out your husband didn't just cheat, but had a frequent-flier account with every brothel in North America for the past 10 years. At least now we know how bad it was. The trick is to find a way to make the cheaters pay."

Read more:      Wall Street's Latest Sucker: Your Hometown

Read more:      The Scam Wall Street Learned from the Mafia

Wednesday, July 11, 2012

The Best Among Us

"In April, the Vatican’s orthodoxy wing, the Congregation of the Doctrine of the Faith [follow known as the office of the Inquisition], , slapped down the majority of American nuns for being “radical feminists.”

It lambasted them for being too interested in poverty and injustice and insufficiently fixated on abortion and contraception the way the male hierarchy is.
The Vatican authorized a takeover by bishops of the Leadership Conference of Women Religious.
It was a legalistic, misogynistic maneuver and an affront to women who have dedicated their lives to the church."
I was raised as a Lutheran, and always had a fascination with the church of my Catholic friends. It seemed so exotic and surreal, which offered an attraction for one raised in the somber atmosphere of the Lutheran Church. I heard stories about nuns, some of them not flattering, and marveled at the outfits they wore, making them seem of another time.
Later in life, I somehow found myself working in a Catholic school in spite of my skepticism of some of the certainties of Faith, and it turned out to be one of the most satisfying experiences in my career as an educator. The biggest revelation during that time was how wonderful the nuns were. They were dedicated, devoted, loving, hard working and interesting people. I can honestly say they were among the most inspirational people I have ever known. Their examples regarding the journey of Faith shamed my often cynical view of religion and served as a model for me to grow on my own journey.
I have watched with dismay as the universally male church leadership of the church, trying to roll back Vatican II, have demonized the good souls who do so much of the Church's work. The manner of the criticism is all the more disturbing. The Bishops are attacking the nuns because of their focus on social justice, as if focusing on the least among us is contrary to church teachings. The irony is heartbreaking.
Carol Marin, journalist extraordinaire for the Chicago SunTimes, is taking the bishops to task.

Read more:     Nuns Who Won't Be Bullied

Read more:      Nuns Take to the Road

Read more:      Priests Come to Nun's Defense

Read more:      The Silence of the Nuns