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27 August 2011

A Century of Palestinian Rejectionism


By Fred Siegel

Casual observers of Middle Eastern politics must be somewhat confused by reports that the West Bank Palestinian leader Mahmoud Abbas, currently in the 81st month of his 48-month term, plans to roil the region by having the United Nations recognize Palestine as a sovereign state. Leave aside that this proposed state has no currency, no recognized boundaries and no support from a Gaza controlled by Hamas. There are also sizable complications in that the Palestinians are bound by official agreements to negotiate directly with Israel and that they have twice in the last decade refused the very state they’re now asking for from the U.N. In 2000 and 2008, Israel agreed to the creation of a Palestinian state with virtually all of the territory it had before the 1967 war. Unfortunately, Palestinian leaders have never been, and are not now, prepared to permanently give up the claim to all of the land first laid out by their Islamist leaders in the 1920s.

For readers perplexed by the knotted history of a region in which Pan-Arabism turns out to be an artifice of Pan-Islamism, and the reverse, Sol Stern’s new 50-page broadside from Encounter Books, "A Century of Palestinian Rejectionism and Jew Hatred," can smooth your wrinkled brow. “To a degree that has still not been fully appreciated,” explains Stern, who draws on a wide range of recent scholarship, “the Palestinian Arabs’ obsession with the Jews and rejection of all political compromise was inspired by Islamic teachings as well as by European fascism.” (Full disclosure: Stern and I have co-written articles on a range of subjects.)

At the center of his account is the neglected and little known -- yet central -- figure of the Arab-Israeli conflict, Haj Amin al-Husseini. As the Grand Mufti of Jerusalem, he was the leader of the Palestinian  movement from its inception in the 1920s in the wake of the British Balfour Declaration, into the 1950s, after which he was succeeded by his nephew Yasser Arafat. The mufti exercised power as both a religious and secular leader through the use of death squads to eliminate potential rivals who might compromise with the Jews.

Like Arafat and Abbas after him, time and again the mufti rejected any compromise. Driven by a sense of Islamic entitlement and Arab resentment of the West, insensible to the economic growth made possible by the relative prosperity of the Jews, the mufti urged his followers to embrace implacable hatred. His journalistic flacks insisted that “if we don’t use force against the Zionists and against the Jews, we will never be rid of them.” And violence there was in the pogroms of the late 1920s and in the late 1930s after the mufti once again refused an offer to divide the land, this time on terms even more favorable to the Arabs. The Zionist leader Chaim Weizmann agreed to partition, even if the territory assigned to the Jews “were the size of a tablecloth.” The mufti and his followers -- he had silenced the opposition -- rejected any compromise.

Stern writes that, like his close ally Hassan-al-Banna, the founder of the fascist-inspired Moslem Brotherhood in Egypt, the mufti organized “a Palestinian youth movement modeled after the Hitler Youth, and he sent a Palestine delegation to the Nazi Nuremberg rallies.” In the Arab revolt of the late 1930s, Islamist crowds stormed through the streets of Jerusalem’s Jewish Quarter shouting slogans such as “Muhammad’s religion was born with the sword.” The mob killed, looted and burned. Two years of low-level war left the Jews stronger than ever and the local Arab economy in ruins, a scene that has recurred time and again. But the mufti saw hope for his cause in Hitler’s war against the allies and the Jews.

The revolt defeated, the mufti fled first to Baghdad, where his allies imposed a Vichy allied regime in 1943 and launched a pogrom against the Iraqi Jews who had been there for thousands of years. He then moved on to Berlin, where he spent the duration of the war as a prized ally of Hitler living in luxury with a princely stipend -- twice the salary of a German field marshal. Like the Kaiser in World War I, Hitler hoped that the natural congruence between Islam and anti-Western, anti-Jewish sentiment could undermine the allies.

From Berlin the mufti broadcast Nazi propaganda to the Arab world and helped recruit a brigade of Bosnian Muslims for the SS. Had Rommel’s campaign succeeded in North Africa, Hitler planned to install the mufti as the head of a Palestinian state. Together, the Fuehrer and the mufti planned to exterminate the Jews of Palestine. During the Nazi attempt to impose “the final solution," the mufti issued “a canonical statement of the connection between Nazism and Islam" as rooted in the Koranic prescription that “the most hostile people are the Jews.”

In the post-war years, the mufti's intransigence was brought to bear on the U.N. debate over a partition for Palestine. Arab League Secretary General Abdul Rahman Azzam vowed, “This war will be a war of extermination and a momentous massacre which will be spoken of like the Mongol massacres and the Crusades.” Appropriately enough, the military commander of the Palestinian Arab Liberation Army in the months before five Arab nations joined the fray in 1948, was Fawzi al-Qawuqji, who had also spent WWII in Berlin. The American left-wing journalist I.F. Stone reported that “German Nazis, Polish reactionaries, Yugoslav Chetniks, and Bosnian Moslems flocked [into Palestine] for the war against the Jews.”

In the wake of the 1948 war, the West Bank now claimed by the Palestinians became part of Jordan and Egypt took Gaza. But there was no thought in Egypt or Jordan or the larger Arab-Islamic world of creating a Palestinian state. The issue then and now was a meld of Islamic entitlement and anti-Western resentment that was tweaked and rebranded as third worldism in the 1960s. Fascist movements in the Arab world were redubbed victims of Western imperialism. The effect was to bury the mufti and his history in clouds of left-wing rhetoric. The great merit of Stern's essay, the prelude to a full scale treatment, is that it rips away the scales of progressive rhetoric to reveal the monstrousness within.

Fred Siegel is a Scholar in Residence at St. Francis College and a Contributing Editor of The Manhattan Institute's City Journal.

25 August 2011

Krugman Finally Jumps The Shark

September 11, 2011, 8:41 am

The Years of Shame

Is it just me, or are the 9/11 commemorations oddly subdued?

Actually, I don’t think it’s me, and it’s not really that odd.

What happened after 9/11 — and I think even people on the right know this, whether they admit it or not — was deeply shameful. Te atrocity should have been a unifying event, but instead it became a wedge issue. Fake heroes like Bernie Kerik, Rudy Giuliani, and, yes, George W. Bush raced to cash in on the horror. And then the attack was used to justify an unrelated war the neocons wanted to fight, for all the wrong reasons.

A lot of other people behaved badly. How many of our professional pundits — people who should have understood very well what was happening — took the easy way out, turning a blind eye to the corruption and lending their support to the hijacking of the atrocity?

The memory of 9/11 has been irrevocably poisoned; it has become an occasion for shame. And in its heart, the nation knows it.

I’m not going to allow comments on this post, for obvious reasons.

 http://krugman.blogs.nytimes.com/2011/09/11/the-years-of-shame/
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September 12, 2011, 2:37 pm

More About the 9/11 Anniversary

It looks as if I should say a bit more about yesterday’s anniversary. So:

The fact is that the two years or so after 9/11 were a terrible time in America – a time of political exploitation and intimidation, culminating in the deliberate misleading of the nation into the invasion of Iraq. It’s probably worth pointing out that I’m not saying anything now that I wasn’t saying in real time back then, when Bush had a sky-high approval rating and any criticism was denounced as treason. And there’s nothing I’ve done in my life of which I’m more proud.

It was a time when tough talk was confused with real heroism, when people who made speeches, then feathered their own political or financial nests, were exalted along with – and sometimes above – those who put their lives on the line, both on the evil day and after.

So it was a shameful episode in our nation’s history – and it’s one that I can’t help thinking about whenever we talk about 9/11 itself.

Now, I should have said that the American people behaved remarkably well in the weeks and months after 9/11: There was very little panic, and much more tolerance than one might have feared. Muslims weren’t lynched, and neither were dissenters, and that was something of which we can all be proud.

But the memory of how the atrocity was abused is and remains a painful one. And it’s a story that I, at least, can neither forget nor forgive.

Update: Greg Sargent documents a bit of the history.

http://krugman.blogs.nytimes.com/2011/09/12/more-about-the-911-anniversary/
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History's Smallest Monster

How the New York Times's star columnist commemorates 9/11.

At 8:41 a.m. on Sept. 11, 2001, most Americans were completely unaware of the world-changing terror that was about to unfold at the World Trade Center. One group that had some inkling had five minutes to live. Eighty-nine of the 92 passengers and crewmen on American Airlines Flight 11 were killed at 8:46, when Islamist terrorists crashed the Boeing 767 into the center's north tower (reportedly the hijackers had already stabbed or slashed the other three to death).

At 8:41 a.m. on Sept. 11, 2011, former Enron adviser Paul Krugman, star columnist of the New York Times, had something he wanted to say: "Is it just me, or are the 9/11 commemorations oddly subdued?" Krugman began his post on the Times website yesterday morning. "Actually, I don't think it's me, and it's not really that odd."

So far, so obvious. Of course the commemorations are subdued. Altogether, just under 3,000 people died in the coordinated attacks of 9/11: at the trade center, whose south tower was hit 17 minutes later; at the Pentagon, and in a field in Western Pennsylvania, where United Flight 93 crashed after passengers overpowered the hijackers, presumably saving the intended target on the ground.

Some of the victims of 9/11 were children, and most of the adults were in the prime of life. In the normal course of events, they would still be with their loved ones 10 years later. Thus yesterday's rituals mourned losses that were sudden and that remain immediate. Ecclesiastes teaches that "there is a time for everything, and a season for every activity under the heavens . . . a time to mourn and a time to dance." Americans danced in May, when Osama bin Laden was finally killed, but yesterday was a time to weep. So of course the 9/11 memorials were subdued.

That's not what Krugman had in mind, however. For him, it is never time to be silent and always time to hate:
What happened after 9/11--and I think even people on the right know this, whether they admit it or not--was deeply shameful. The atrocity should have been a unifying event, but instead it became a wedge issue. Fake heroes like Bernie Kerik, Rudy Giuliani, and, yes, George W. Bush raced to cash in on the horror. And then the attack was used to justify an unrelated war the neocons wanted to fight, for all the wrong reasons.
Giuliani and Bush "raced to cash in on the horror"? How? Krugman doesn't say. (We'll concede his point regarding Kerik, currently in federal prison after pleading guilty to multiple charges including tax fraud. But dwelling on Kerik's malefactions seems awfully petty on 9/11.) 

In any case, was shame really the reason the 9/11 ceremonies were subdued? Tom Maguire says no:
I watched a bit of the memorial service at Ground Zero. Two strangers would go through about six names from the alphabetized list; then they would read off the name of their father, mother, brother, sister, niece, or whatever, say a few words, and move off-stage. Some of the readers were totally composed, but most got a bit choked up when they got to their loved one. Watching twenty year-olds say good-bye to a mother they lost when they were ten isn't easy, but watching a forty year old cop lose it when saluting his father is not so easy even for a cold-hearted, insensitive right-wing troglodyte like me.
Now, I suppose it is possible that the family members were choking up because they were reflecting on the Iraq War and the grim reality that Gitmo remains open. Or perhaps they were subdued by concerns over the Patriot Act and warrantlesss wiretapping. I am not smart or sensitive enough to be a lib like Krugman, but I didn't see it that way.
It's also hard, at this late date, to credit Krugman's argument that the Bush administration and "neocons" are solely to blame for the breakdown of national unity in the years after 9/11. Immediately after the attacks, support for Bush policies was overwhelming: The Patriot Act, for instance, passed the House 357-66 and the Senate 98-1. A year later, the authorization to use military force in Iraq drew strong (though far from unanimous) bipartisan support. It was backed by 81 House Democrats and 29 Senate Democrats.

To the extent that terror policy ended up polarizing the parties, then, it was because Democrats changed their minds. Arguably they eventually profited politically from doing so. At the very least, it did not prevent them from winning big victories in the elections of 2006 and 2008.

Yet as we noted in our Weekend Interview with Michael Mukasey, Barack Obama--who as a state senator, a U.S. senator and a presidential candidate was a harsh critic of Bush administration terror policies--as president has proved unable or unwilling to make any major changes in those policies, with the exception of interrogation. (The Bush administration had already ended the CIA's "enhanced interrogation" program; its successor cut the CIA out of interrogation altogether.)

In some cases, notably Guantanamo and civilian trials for terrorists, Obama has continued the Bush policies in spite of his own inclinations, under pressure from Congress. Yet that pressure began in 2009-10, when Obama's own party had huge majorities in both houses--suggesting that the country is after all fairly unified, that Obama is out of step, and that the Democrats' move to the left between about 2003 and 2008 was merely opportunistic and ideological.

Krugman goes on to observe that beside Bush, Giuliani and Kerik, "a lot of other people behaved badly. How many of our professional pundits--people who should have understood very well what was happening--took the easy way out, turning a blind eye to the corruption and lending their support to the hijacking of the atrocity?"

[botwt0912] 
The man who loves to hate

He has half a point here. We remember one professional pundit who behaved quite badly, writing on Sept. 14, 2001: "It seems almost in bad taste to talk about dollars and cents after an act of mass murder," he observed, then went ahead and did so: "If people rush out to buy bottled water and canned goods, that will actually boost the economy. . . . The driving force behind the economic slowdown has been a plunge in business investment. Now, all of a sudden, we need some new office buildings."

That was former Enron adviser Paul Krugman, who added that "the attack opens the door to some sensible recession-fighting measures," by which he meant "the classic Keynesian response to economic slowdown, a temporary burst of public spending. . . . Now it seems that we will indeed get a quick burst of public spending, however tragic the reasons." He went on to denounce the "disgraceful opportunism" of those who "would try to exploit the horror to push their usual partisan agendas"--i.e., conservatives who he said were doing exactly what he was doing.

Krugman concludes his 10th-anniversary objurgation as follows:
The memory of 9/11 has been irrevocably poisoned; it has become an occasion for shame. And in its heart, the nation knows it.
I'm not going to allow comments on this post, for obvious reasons.
As the Village Voice's Nick Greene sums it up: "I need to get something off my chest today, but you can't." Blogger Ed Morrissey adds:
After reading this, you seriously have to remind yourself that the New York Times pays Krugman to write it; this wouldn't even pass muster for a Letter to the Editor at most newspapers. It's so trite, sad, and cliched that it's hardly worth the effort to rebut. He's mailing this in from 2003.
In fact, we found exactly the post from Sept. 11, 2003, that captures the sentiments Krugman is expressing now. It came from a young Josh Marshall, proprietor of TalkingPointsMemo.com, who described his reaction to a CNN documentary on 9/11:
Watching brought me back to the newness and rawness of those first hours and days. . . . I thought [President Bush] served admirably in those first days.
As the documentary moved toward the aftermath, I wondered whether those thoughts of mine would seep into the present to color what's happening today.
They didn't.
What I felt wasn't continuity but the jarring contrast, the cheap, obvious lies, the hubris, the tough-talk for low ends, not so much the mistakes as the tawdriness of so much of what's happened, especially over the last eighteen months.
Marshall weighed in again yesterday, with considerably more maturity than Krugman. Avoiding the temptation "to relitigate Iraq," he instead made the interesting observation that the 9/11 attacks were "simply too much barbarity and aggression with too few to punish":
The immediate perpetrators died in the attacks, embracing and thus stealing away from us whatever degree of punishment was possible. And while there were many more people planning, working money transfers and providing other kinds of support, still . . . relative to the enormity of the violation, just too few. It goes to a primitive part of ourselves. But you could hunt down and kill every one of them and somehow it still wouldn't be enough.
That may explain why, even a decade later, someone like Krugman sees 9/11 as an occasion to lash out at his domestic political opponents. "Everybody's angry, to judge from my email, about Paul Krugman's typo-burdened 9/11 screed," writes Glenn Reynolds. (For at least 15 hours after Krugman posted it, the screed referred to "te atrocity.")

Reynolds offers some advice: "Don't be angry. Understand it for what it is, an admission of impotence from a sad and irrelevant little man." Indeed. That post was monstrous, but it was trivial in equal measure. Paul Krugman is history's smallest monster.

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\"A message to progressives: By all means, hang Senator Joe Lieberman in effigy."

- Paul Krugman, Pass the Bill, 17 December 2009


“I was nervous until they finally called it on Election Night.  We had an Election Night party at our house, thirty or forty people.  The econ department, the finance department, the Woodrow Wilson school.  They were all very nervous, so they were grateful we were having the party, because they didn’t want to be alone. We had two or three TVs set up and we had a little portable outside fire pit and we let people throw in an effigy or whatever they wanted to get rid of for the past eight years.”

- Paul Krugman and his wife, Robin Wells, The Deflationist, The New Yorker, 1 March 2010


'If Obama Called for Endorsing Motherhood Republicans in the House Would Oppose It'

- Paul Krugman, ABC's This Week, 4 September 2011

"If we discovered that, you know, space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months. And then if we discovered, oops, we made a mistake, there aren't any aliens, we'd be better..."

- Paul Krugman, CNN's Fareed Zakaria GPS, 14 August 2011

"[S]lashing spending while the economy is depressed won’t even help the budget situation much, and might well make it worse. So those demanding spending cuts now are like medieval doctors who treated the sick by bleeding them, and thereby made them even sicker."

- Paul Krugman, The President Surrenders, New York Times, 31 July 2011

"But making nebulous calls for centrism, like writing news reports that always place equal blame on both parties, is a big cop-out — a cop-out that only encourages more bad behavior. The problem with American politics right now is Republican extremism, and if you’re not willing to say that, you’re helping make that problem worse."         

- Paul Krugman, The Centrist Cop-Out, New York Times, 28 July 2011
  
"The cult that is destroying America...No, the cult that I see as reflecting a true moral failure is the cult of balance, of centrism...You have to ask, what would it take for these news organizations and pundits to actually break with the convention that both sides are equally at fault? This is the clearest, starkest situation one can imagine short of civil war." 
- Paul Krugman, The Cult That Is Destroying America, New York Times, 26 July 2011

"Slashing spending at a time when the economy is deeply depressed would destroy hundreds of thousands and quite possibly millions of jobs."

- Paul Krugman, To The Limit,  New York Times, 30 June 2011

"Some years down the pike, we’re going to get the real solution, which is going to be a combination of death panels and sales taxes."

- Paul Krugman, ABC's This Week, 14 November 2010 

 "In short, Europe continues to be a big-government sort of place. And that’s why it’s important to get the real story of the European economy out there.  According to the anti-government ideology that dominates much U.S. political discussion, low taxes and a weak social safety net are essential to prosperity. Try to make the lives of Americans even slightly more secure, we’re told, and the economy will shrivel up — the same way it supposedly has in Europe.  But the next time a politician tries to scare you with the European bogeyman, bear this in mind: Europe’s economy is actually doing O.K. these days, despite a level of taxing and spending beyond the wildest ambitions of American progressives."
 
-Paul Krugman, "The Comeback Continent," New York Times, 11 January 2008

"I actually I think it may be necessary to take this up to the limit because the fact of the matter…(And, default?)...Possibly if we have complete, if we have demands for a large change in policy, under threats of debt limit, this has to be the point where you say, 'No, we don't believe in letting hostages be taken.' Let me make my case here. Okay, let me just say, we have an enormous budget dispute. We have vastly opposed poles in policy. That is not something we should resolve with a, you know, with a bomb hanging over our head. It's not something we should try and change. And so Democrats have to make clear that they’re not going to let themselves be blackmailed in that way."

- Paul Krugman, ABC's This Week, 15 May 2011

One day, perhaps, they will find a drug that will allow his body not to reject a brain transplant...until then, we will mock him in all of his absurdity and lavish heaps of ridicule upon his naked crown for the Ferret of Economics has been reduced to being an irrelevant clown.

Big Government Robs The Middle Class Because That's Where The Money Is!








I rob banks because that's where the money is.” 

– Willie Sutton





The Left thinks that the rich in America pay a pittance, but is that true? 
 
On 01.01.13, the top marginal tax rate in the United States will automatically rise to 43.4%.

If you are wealthy and live in a state like New York, your combined, marginal tax rate is about 58%. 

To put that into context, the top combined, marginal tax rate in COMMUNIST China is 45%.




In PROGRESSIVE Canada, the top marginal tax rate is 29%, the capital gains rate is 10%, and the dividend rate is 19%.

In 2011, Canada’s GDP was $51,147 per person  compared to $48,147 in the United States.

Our tax rates are already higher than those in Canada, so we don't even need to factor in the 2013 Obama American Nightmare, but how did our GDP with higher tax rates stack up against Canada's GDP with lower tax rates:

Canada's GDP in 2008 was 0.7%; in 2009: -2.8; in 2010: 3.2; in 2011: 2.5; and in 2012: 2.1; and the forecasted GDP growth rate for 2013 is 3.4%.

America's GDP in 2008 was -0.3%; in 2009:  -3.5%; in 2010: 3.0%; in 2011:  1.7%; and in 2012: 1.9%; and the predicted GDP growth rate for 2013 is 2.1%, 2.6% 0r 2.5%-3.0%, depending upon who is doing the forecasting.

On 01.01.13, in Obama's America, the top marginal rate will soon be 43.4%, the capital gains rate will be 23.8%, and the top dividend rate will be 43.4%.  There will be a 3.8% investment income surtax, also called the health care surtax or the Medicare tax.  This new surtax will be assessed on the lesser of a) net investment income or b) the excess of modified adjusted gross income (MAGI) over the “threshold amount.” For married taxpayers filing jointly, the threshold amount is $250,000; married filing separately, $125,000; all other individual taxpayers, $200,000. For trusts and estates, it is the beginning of the top income tax bracket ($11,650 in 2012).  The Inheritance Tax Rate will return to 55% (PLEASE see a financial planner and trust attorney.  Also, life insurance proceeds are NOT subject to inheritance/estate taxes).  There will also be a 0.9 percent Medicare tax on earned income, which will not be matched by an employer.


The head of the International Monetary Fund, Christine Lagarde, said measures taken to protect Canada’s economy should be a model for countries trying to fix their financial systems and that Canada has been a leader in creating policies intended to rein in the build-up of household debt.

“Abroad, Canada is identified by its values of co-ordination and consensus building, which have given your country influence beyond its years. Building a safe and stable financial system is in the best interests of the global community, but it also serves the self-interest of nations,” she added.

She pointed to the decision by Finance Minister Jim Flaherty to boost down payments on new mortgages for homebuyers as an example of restraint that others should follow.

“All of these new reforms comprise the tools so far that will help us shape the future financial system. We must shape the system so it cannot again hold us ransom to the consequences of its failings.”

Lagarde’s speech focused on global financial reforms that while “heading in the right direction,” still haven’t delivered the safer financial system they were designed to create.  “Some financial systems are still under distress and crisis-fighting efforts are inadvertently impeding reforms,” Legarde said.

Canada never had the housing bubble or the financial meltdown.  They've always looked at housing and banking differently. 



For example, Congressman Louis McFadden was a Republican and Chairman of the United States House Committee on Banking and Currency acting on the recommendation of the Comptroller of the Currency, Henry May Dawes (The Great-grandfather of Bill Schultz of Red Eye fame!) pushed through The McFadden Act of 1927.  The Act, specifically, prohibited interstate branch banking in the United States., and only allowed banks to open branches within the single state in which it was chartered. Therefore, U.S. banks were forced to be small and local, with an undiversified loan portfolio tied to the local economy of a single state, or a specific region of a single state. Granted, the intentions behind the Act were fairly noble coming after the Robber Baron Age and the fast-n-loose playing rules that necessitated the Sherman Antitrust Act, but the strict regulatory framework of the McFadden Act created a delicate and fragile banking system that could not easily withstand the shock of the Great Depression.


Back during the Great Depression, the United States these idiotic rules that prevented "branching" really destroyed the country's financial system.  In other words, banks couldn't have branches in other states.  They may get too big for their striped pants and top hats!  In my best Edith Bunker voice, "Those were the asinine days..."  It's one thing to worry about "Too Big To Fail."  It's another thing altogether to put into place a "Too Small To Survive A Bank Run" rule.  If you had another branch over yonder in Lawrence, Kansas, it could rustle you up some cash - like real quick - to settle down your customers in Belton, Missouri.   But, nooooooo!  Someone might get to wear a monocle instead of spectacles like the rest of dem po folk.

Between the Crash of 1929 and 1941, over 9,000 banks failed in the United States and that included years after the passage of The Truth in Federal Securities Act of 1933, The Emergency Banking Relief Act of 1933, The Banking Act of 1933 a/k/a the Glass–Steagall Act, which created the Federal Deposit Insurance Corporation, the Securities and Exchange Commission of 1934,  the Federal Trade Commission, the unconstitutional National Industrial Recovery Act of 1933, the unconstitutional Agricultural Adjustment Act of 1933, expanded Hoover's Reconstruction Finance Corporation, expanded Hoover's Federal Emergency Relief Administration and then named it the Works Progress Administration in 1935, and so many more projects, programmes, diktats, boards, experts, think tanks comprised of experts, etc.

Between the Crash of 1929 and 1941, NO banks failed in Canada.  None.  Zip.  Zilch.  Nada.



Whenever there is a problem, Americans say, 'There oughta be a law!"



Whenever American politicians see something that they do not think is fair, they say, "There needs to be a law and/or regulation!"

Canada didn't have a housing crisis because it doesn't have a policy that says: Every Canadian should own a home.  Homeownership is a fundamental right.

Canada didn't have a housing crisis because it didn't set out to push square mortgage applicants into round mortgage lenders with the Sword of Damocles hanging over the head of the bank.

*  Heading into the crisis, banks here were under stricter rules, forced to set aside more capital than U.S. firms and managed with a more conservative bent. Government agencies such as the Canada Mortgage and Housing Corp. hewed closely to policies in which they supported the housing market by offering mortgage insurance, but unlike Fannie Mae and Freddie Mac in the United States, they were never expected to encourage homeownership as a social or economic end.

Canadian tax law is neutral: Interest on mortgage payments is not deductible, a fact that encourages home buyers to make larger down payments and avoid withdrawing equity. The banks themselves expect to hold on to the mortgages they make and collect the interest. Most loans allow interest rates to be reset after five years, and most also carry prepayment penalties -- rare in the United States. 





*  There are no 0%, 5%, or 10% downpayments.  There are no no-doc loans.  Most buyers put down between 15% and 20% and take out only 15 year loans.

* "Fundamentally, what we have seen is the Canadian housing market responding to the dynamics of supply and demand,"  Craig Alexander, TD Bank's chief economist said. He contrasted that with a U.S. housing market driven by loose lending standards and by Wall Street demand for mortgages to be bundled and sold as securities: "The mortgages made in Canada are mortgages that banks are quite happy to keep on their balance sheets." 

* Subprime mortgages in Canada accounted for only about 5 percent of the loans originated by local banks during the housing boom, compared with more than 20 percent in the United States.

*  And while U.S. housing has remained sluggish, the Canadian market is showing so much life that the Bank of Canada recently raised interest rates and regulators have taken other steps to temper demand -- for example, tightening mortgage qualification rules.  Meanwhile, the Obama administration is demanding loosening qualification rules.  Who didn't know that?








In "PROGRESSIVE" Canada, on 1 January 2012, Canada's federal corporate tax rate automatically fell to 15% from 16.5% as the last installment of a series of corporate rate cuts launched in 2006 by the administration of Prime Minister Stephen Harper.  When Harper initiated his campaign, Canada's overall corporate tax rate was 33.9% according to the OECD, third-lowest in the G-7. The federal corporate rate was 22% and the average provincial rate was 11.8%. Today, Canada now has an overall (Federal and provincial) corporate tax rate of 25%, the lowest rate of the G-7 nations.

Small businesses today have a special, lower rate of 11%.
 


The Left thinks the corporations in the United States have it easy (Some do.  I'm looking at you, General Electric, Mr Obama's Chairperson of the Council on Jobs and Competitiveness, Jeffrey Immelt, and Google, who paid a whopping effective rate of 2%), but do they?  A few do, but most don't.  Not every corporation is an Apple, Halliburton, Google, GE, etc.  Most of small businesses.

The United States has the highest combined corporate income tax rate in the world at 39.21%, which will rise to 46.2% in 2013 before any Obamacare taxes or new taxes under Obama take effect.

To put that into perspective, COMMUNIST China's combined corporate income tax rate is 25%.  That's right.  The Commies allow you to keep more of your own money!!!

Brasil's corporate rate is 25% and it is an emerging economy. Russia’s corporate rate is 20% and India’s is a 33.9% statutory tax rate.

The average corporate tax rate in the "SOCIALIST" EU is 23.5%.  The lowest rates were in Bulgaria and Cyprus at 10%.  Ireland barely lost out because its corporate rate is 12.5%.    Belgium, which didn't even have a government for more than a year and has a strong, separatist movement, has the highest corporate rate at 33.99%.  Socialist France almost beats Belgium with a corporate tax rate of 33.33%.

I feel fairly certain that France will take over the #1 spot in all tax categories soon even though diminishing returns are already starting to appear.  The 4th wealthiest man in the world, the wealthiest man in Europe, and the wealthiest man in France, Bernard Arnault, who runs luxury giant LVMH Moët Hennessy Louis Vuitton and has an estimated net worth of $41 billion  confirmed news reports from Belgium that he applied for citizenship there in September.  He's hardly the only one...just the richest, but what makes news?  The 4th richest man in the world or a whole bunch of millionaires moving to London to set up work in The City?  Even Karl Lagerfeld's feathers are flying!!!


“This idiot will be as disastrous as (Former Spanish Socialist Prime MinisterJose Luis Rodriguez) Zapatero was.  It’s a disaster. He wants to punish (the rich) and of course they leave and no one invests.  Foreigners don’t want to invest in France and that’s just not going to work.  Outside of fashion, jewellery, perfume and wine, France isn’t competitive.  The rest of our products don’t sell. Who buys French cars? I don’t.” 

- Karl Largerfeld,on President François Hollande's decision to further tax the rich,Spanish Marie Claire, October 2012


I ain't no fooling either (or birthin dem babies).... on 01.04.12, Great Britain will lower its corporate rate to 25% from 26%. Britain's rate is schedule to fall even further to 23% by 2014.  I'm thinking that the Official Monster Raving Loony Party needs to have a major bash with the ghostlyy Screaming Lord Sutch and the Savages headlining.  Safety-pin earrings, black ripped stockings, purple hair, and bang your head to 23% corporate tax rates!!! 


 Sitting, Facing Forward!!!


And, before you start, yes, China, Canada, Brasil, Russia, India, Belgium, etc., ALL have deductions for operating expenses...just like the US.

Furthermore, ONLY the United States taxes the profits of its corporations when made overseas and on which the entities have already paid taxes in the situs of earnings.  I told you bloody geniuses that, if you allowed the repatriation of the $2.3 trillion that is currently sitting in corporate foreign bank accounts tax free provided it is spent on R&D, expansion, distributions, or new hires, you'd have the biggest bloody stimulus in history. It would make the Supercalifragilisticexpialidocious Stimulus Act of 2009 look like one of The Ferret's droppings.

According to the OECD, the United States has the most progressive individual tax system in the world.  While it is true that tax rates on the uber-wealthy are certainly higher in some countries, the tax base is much wider.  There isn’t a country in Europe where 47-52% of the working population avoids paying national income tax.

For example, a senior level nurse in a London hospital earns approximately $49,000.  She will pay around $10,500 in income taxes, $6,039 in National Insurance  taxes, a 20% VAT, council taxes, and other assorted taxes…in an area where it is more expensive to live than in Manhattan or San Francisco.  


Eventually, Obama must levy his tax increases at lower income levels because that's where the money is and there just aren’t enough millionaires and billionaires to pay for the Federal government that he wants.  Truth be told, there aren’t enough middle class taxpayers to pay for it either.

In 2009, 237,000 taxpayers reported income above $1 million and they paid $178 billion in taxes. A mere 8,274 filers reported income above $10 million, and they paid only $54 billion in taxes.

But 3.92 million reported income above $200,000 in 2009, and they paid $434 billion in taxes. To put it another way, roughly 90% of the tax filers, who would pay more under Mr Obama's plan aren't millionaires, and 99.99% aren't billionaires.

Between 2007 and 2010, the number of those earning:

$200,000 per year declined by 13%

$1 million per year declined by 39%

$10 million per year declined by 55%

The more a government relies on a smaller number of taxpayer, the more it is setting itself up for a cataclysmic event when the market turns.  Nowhere is this more evident than in places like California.

In 2006, for example, according to the Franchise Tax Board, Californians making more than $500,000 a year filed just 1% of all state income tax returns — and paid 47.2% of the taxes.  When the recession hit, the wealthy saw their incomes drop sharply, which resulted in a dramatic drop in tax revenues.

In 1990, the highest individual income tax rate of our major economic trading partners was 51%, while the U.S. was much lower at 33%. It's no wonder that during the 1980s and '90s the U.S. created more than twice as many new jobs as Japan and Western Europe combined.

According to the OECD, over the past two decades the average highest tax rate among the 20 major industrial nations has fallen to about 45%. Yet the highest U.S. tax rate would rise to more than 43.4% no counting the proposed "Alternative Minimum Millionaires' Tax." To make matters worse, if we include the average personal income tax rates of developing countries like India and China, the average tax rate around the world is closer to 30%, according to a new study by KPMG.

"You can't rob a bank on charm and personality.”


- Willie Sutton


Not even dictators can govern for long on charm and personality, Presidents' days of getting away with it are even shorter.

Only time will tell how long the middle class will stand for allowing the Great Leviathan to rob them with charm, personality, or anything else.



Political Cartoons by Chip Bok


________________________________________________________________



 Average Federal Income Taxes Paid, as Percent of Income

Income..................Average tax rate

Under $75K.....................6.6%.......

$75K to $100K................8.5%.......

$100K to $200K.............11.9%.....

$200K to $500K.............19.6%....

$500K to $1M..................24.4%...

$1M to $1.5M...................25.3%...

$1.5M to $2M...................25.6%...

$2M to $5M......................25.8%...

$5M to $10M...................25.4%...

$10M or more.................22.6%..


http://www.irs.gov/taxstats/indtaxstats/article/0,,id=134951,00.html



From Obama's Neo-Nationalism II:



"Osawatomie" was the name chosen by the Weather Underground for its newsletter, which praised Communists like Mao and Ho Chi Minh.  So in keeping with the flotsam and jetsam spewed in Obama's buddy, William Ayers' publication, let's pretend that, instead of proposing to raise the top income tax rate well north of 40%, Obama decided to go all-out Communist and tax the wealthy at 100%.   Would this bring about the nirvana of which Obama brays continuously?  Hardly.

Consider the income tax statistics for the year 2008 as compiled by the Internal Revenue Service.  The top 1% of taxpayers -- those with salaries, dividends and capital gains roughly above about $380,000 -- paid 38% of taxes.  But, if the tax policy had been to confiscate ALL of the taxable income earned by the "millionaires and billionaires," whom Obama has chosen, frozen, and targeted for special Alinksy-type treatment, the yield from that total haul would be a mere $938 billion, which is not even a quarter of the money that the Obama administration spends annually (25% as a share of the economy, a post-World War II record) and much less than the amount it wants to spend in the next decade per the President's own budget.  Total confiscation would leave you still with $3.1 trillion deficit instead of a $1.5 trillion deficit.

Since the "millionaires and billionaires" aren't going to do it for Mr Obama, say we apply the 100% income tax rate to the top 10%, or everyone with income over $114,000, including joint filers. Yes, that's five times Mr Obama's 2% promise, but, hey, Promises!  Promises! The IRS data are broken down at $100,000, yet taxing all income above that level throws up only $3.4 trillion and remember, the top 10% already pay 69% of all total income taxes, while the top 5% pay more than all of the other 95%.  We would STILL have a deficit AND you can bank this:  Next year, you will not find many individuals earning more than $100,000.

I recognise that 2008 was a bad year for the economy and thus for tax receipts, as the income of the "evil rich" is always more volatile and susceptible to fluctuations in the economy.  So, let's do the same with 2005 income (Ahem, it was a banner year of amazing tax receipts due to the Bush tax cuts that Obama loathes and blames for every ill ever to plague mankind).  In 2005, the top 5% earned over $145,000.  If all the income of people earning over $200,000 was taxed at 100% a/k/a confiscation, it would yield about $1.89 trillion, enough revenue to cover the 2012 bill for Social Security, Medicare, and Medicaid -- but not the same bill in 2014 or 2020 since the costs of these entitlements alone are expected to grow exponentially and rapidly.  In short, the "evil rich" aren't nearly rich enough to finance the welfare state ambitions of Obama and that's before Obamacare even kicks into gear.



1taxes



So who else is there to tax? Well, in 2008, there was about $5.65 trillion in total taxable income from all individual taxpayers, and most of that came from Middle Class income taxpayers.  The chart below shows the distribution, and the big hump in the center is where Democrats are inevitably headed for the same reason that Willie Sutton robbed banks.



"Some billionaires have a tax rate as low as 1 percent — 1 percent. That is the height of unfairness." 

- Barack Obama, Osawatomie, Kansas, 6 December 2011





The White House could offer nothing more than a clip of a conversation on Bloomberg TV, in which correspondent Gigi Stone made this assertion during a discussion about the tax strategies that the very wealthy use to avoid paying taxes.  The TV clip was promoted by the left-leaning Web site Think Progress, but Stone cited an article which made no such claim.  In fact, the evidence proves the opposite of Mr Obama's claim.

In 2008, of the top 400 taxpayers, 30 paid an average tax rate of between zero and 10%, 59 paid an average tax rate of 30-35%, while 238 paid a marginal tax rate of 35% and above. Of the top 400 taxpayers, only 17 had a marginal rate of 0-26%.  The average tax paid by the individuals in this group was nearly $50 million. 


There are roughly 1,210 billionaires in the world.  Their total net wealth is approximately $4.5 trillion.  If Obama took all their money - including that of the non-Americans, he could fund his government for approximately 1.3 years.



“I mean, understand, it's not as if we haven't tried this theory. Remember that in those years, in 2001 and 2003, Congress passed two of the most expensive tax cuts in history, and what did they get us? The slowest job growth in half a century. Massive deficits that have made it much harder to pay for the investments that built this country and provided the basic security that helped millions of Americans reach and stay in the middle class...."


- Barack Obama, Osawatomie, Kansas, 6 December 2011 



As Peter Ferrara noted, here is what really happened:

"Those Bush tax cuts quickly ended the 2001 recession, despite the contractionary economic impacts of 9/11, and the economy continued to grow for another 73 months. After the rate cuts were all fully implemented in 2003, the economy created 7.8 million new jobs and the unemployment rate fell from over 6% to 4.4%. Real economic growth over the next 3 years doubled from the average for the prior 3 years, to 3.5%.

In response to the rate cuts, business investment spending, which had declined for 9 straight quarters, reversed and increased 6.7% per quarter. That is where the jobs came from. Manufacturing output soared to its highest level in 20 years. The stock market revived, creating almost $7 trillion in new shareholder wealth. From 2003 to 2007, the S&P 500 almost doubled. Capital gains tax revenues had doubled by 2005, despite Bush's 25% cut in the capital gains rate.

The deficit in the last budget adopted by Republican Congressional majorities was $161 billion for fiscal 2007. Today that deficit is nearly 10 times as much. Total federal revenues under Bush soared by nearly 30%, from $1.991 trillion in 2001 to $2.568 trillion in 2007. The day the Democrat Congressional majorities took office, January 3, 2007, the unemployment rate was 4.6%. George Bush's economic policies, "the failed policies of the past" in Obama's rhetoric, had set a record of 52 straight months of job creation."

According to the Bureau of Labor Statistics, job growth has been slower under Obama than under Bush: 40,500 jobs a month versus 68,000 jobs per month.

Mr Obama likes to argue that the "massive deficits" are the result of the Bush tax cuts and that returning to the Clinton tax rates, at least, for the wealthy would solve the fiscal problems.  As we have seen, the "evil rich" aren't rich enough to fund his grandiose government, but his claims about the cause of the deficits is equally ridiculous.  According to the Congressional Budget Office, the Bush and Obama tax cuts are responsible for less than 24% of the deficits accumulated in the last decade.  Data provided by the CBO shows that  the largest cause of deficits was increased spending, which accounted for 36.5% of the decline in the fiscal position of the United States over the last decade and entitlements are responsible for the rest.

More importantly, President Obama seeks to retain 70% of the Bush tax cuts, along with his payroll tax cut.   When will he start taking responsibility for the deficits that he not only has generated, but will create?  If the Bush tax cuts caused the deficits, then isn't Obama responsible for 70% of future deficits, at minimum, should he retain most of them?

Further, according to the Washington Post, "it is best to ignore raw numbers but instead focus on the size of the tax cut as a percentage of national income. Under that measure, the John F Kennedy tax cut of 1964 (-1.90%) and the Ronald Reagan tax cut of 1981 (-1.40%) were larger than Bush’s 2001 tax cut (-0.80%)."

Another idiosyncrasy that Obama has is to impute illegality to lawful behaviour.  He will rail against the use, by corporations and "rich people," of loopholes and deductions, as though such is a crime.  Let us be reminded of the famous axiom of Judge Learned Hand:




"Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the Treasury.  There is not even a patriotic duty to increase one's taxes.  Over and over again, the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible.  Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands." 


- Judge Learned Hand, Gregory v. Helvering, 69 F.2d 809, 810 (2d Cir. 1934), aff'd, 293 U.S. 465, 55 S.Ct. 266, 79 L.Ed. 596 (1935)



According to Obama, it is also fair to raises taxes on the top 2 brackets while further lowering payroll taxes, which pay current Social Security benefits and are the consideration that this generation of workers makes in order to receive such benefits when they retire.

Do Obama and Democrats even realise the consequences of their position?  They are turning Social Security, etc., into welfare programmes, which Franklin Delano Roosevelt and the Progressives that created Social Security were vehemently against, and is undermining the precarious financial condition of them.

What is going to happen when politicians want to allow the payroll tax cut to expire?  Will they be allowed to do so by a public that likes claiming that it is paying now for their retirement later, but, in reality, aren't paying at all or doing so in a de minimis fashion?

The "evil rich" do not have the money to fund Social Security and Medicare even if they are taxed at 100% much less just removing the cap on $106,800.  Without the payroll taxes collected from all workers, Social Security and Medicare will generate even greater deficits than now and there will be reluctance by politicians to end the tax cut because, as Democrats have argued, it would raise taxes on the marginalised Middle Class.  Thus, Democrats will continue to choose to undermine the very social safety net that they profess to champion.  When will they be forced (by the bond market and demographics) to tell Americans that they will have no Social Security and Medicare in the future?



"Now, in the midst of this debate, there are some who seem to be suffering from a kind of collective amnesia. After all that's happened, after the worst economic crisis, the worst financial crisis since the Great Depression, they want to return to the same practices that got us into this mess. In fact, they want to go back to the same policies that stacked the deck against middle-class Americans for way too many years. And their philosophy is simple: We are better off when everybody is left to fend for themselves and play by their own rules ..." 

- Barack Obama, Oswatomie, Kansas, 6 December 2011



This statement is quite possibly the biggest lie that Obama has ever uttered. "Even before Obama was elected, under those "failed policies of the past," the top 1% of income earners in 2007 paid 40% of federal income taxes (up from 17.6% when Reagan entered office), while the CBO just reported that they earned 17% of the income in 2007. Moreover, that 40% of federal income taxes paid by the top 1% was more than paid by the bottom 95% combined, according to official IRS data. While the top 1% paid 40% of federal income taxes, the bottom 40% paid no federal income taxes as a group on net. Today, 47% pay no federal income taxes."

Far from letting the "evil rich" off the hook, Obama has seen to it that the nation's job creators, investors and small businesses will face massive tax increases in 2013 when the Bush tax cuts expire and the Obamacare tax rises go into effect.  In that year, the top marginal rate will rise to 43.4% and the 2 rates will rise to by nearly 20%, the capital gains rate will skyrocket by 60%, the tax on dividends will triple, and the Medicare payroll tax on disfavoured taxpayers will increase by 62%.  While Mr Obama and Democrats continue to repeat the 2008 mantra about returning to the Clinton tax rates, the tax rates on the top two brackets will far exceed those rates in 2013.

As I have previously written, the United States has, according to the OECD, the most progressive individual income tax system in the world and the highest corporate tax rate in the industrialised world at close to 40% on average, including state corporate rates.  Further, as I have noted, the corporate tax rate in Communist China is only 25%.  The average corporate tax rate in Socialist EU is even less on average and the rate in Progressive Canada is 16.5% and will be 15% next year.




"Now, it's a simple theory. And we have to admit, it's one that speaks to our rugged individualism and our healthy skepticism of too much government. That's in America's DNA. And that theory fits well on a bumper sticker. But here's the problem: It doesn't work. It has never worked. It didn't work when it was tried in the decade before the Great Depression. It's not what led to the incredible postwar booms of the 50s and 60s. And it didn't work when we tried it during the last decade. I mean, understand, it's not as if we haven't tried this theory."


- Barack Obama, Oswatomie, Kansas, 6 December 2011



One would be tempted to call Mr Obama a liar here, but it is much more likely the case that this statement is just another example of his complete ignorance and idiocy when it comes to economics and economic history.  Previously, I have explained the economics of the Roaring 20s, which were called that for a reason.  These would be the years 1921-1929, when on account of a tax cut put together in 1921, the economy boomed at 4.8% per year as unemployment and inflation (the latter recently on a 100% run) both collapsed.  You can read more about it here.  I have also explained how, "If You Want Obamavilles, Repeat What Hoover Did" and you can read that piece here.  I will say this:

Between 1945 and 1960, there were 5 recessions - many more than occur in a normal cycle. February through October 1945, November 1948 through October 1949, July 1953 through May 1954, August 1957 through April 1958, and April 1960 through February 1961.  The trough of the recession at the end of World War II was 1947, when the Republican majority in Congress conspired to win a tax cut over President Truman’s veto. Result: a 6-year run of 4.8% growth.

When the recession came in 1953, Eisenhower refused calls for another tax cut and, as a result, there were 3 recessions during his administration and, when Eisenhower left office in January of 1961, he had presided over 8 years of an anemic 2.4% annual, average growth rate.   In large part, that sluggish growth was due to high tax rates, not just on the wealthy, but on the middle class as well.  In fact, increasing tax rates on the wealthy led to increases in tax rates on middle-class incomes.

Vice-President Richard Nixon paid a price for what Obama called this "incredible postwar boom."  He lost to John F Kennedy, who -- all together now -- CUT TAXES.

After Kennedy's tax cut, which according to the Washington Post was the largest in history, the great 1960s boom ensued, with an average growth GDP growth rate of 4.9% between 1961 to 1969.  Furthermore, between 1962 and 1969, investment grew at an annual rate of 6.1% far higher than the 3% annual rate for 1959-1962 and the 2.3% rate for 1969-1972, after the JFK tax reforms had been repealed.  Real GNP grew 4.5% during the 1960s, higher than the 2.4% growth rate seen from 1952-1960.
 
So, what has NEVER worked is Keynesian economics.  What is not working now is Obamanomics.   What has continued to fail us now is that Obama's own policies, the exact opposite of what has worked in the past in every detail, have failed to produce any timely real recovery from the last recession. Prior to this last recession and since the Great Depression, recessions in the United States have lasted an average of 10 months, with the longest being only 16 months.  Further, all data proves that the deeper the recession in the United States, the more robust the recovery ... that is, until now.  Here we are, 48 months after the commencement of the most recent recession and there is no sign of any real recovery.  Rather than a record recovery, we have record poverty, record food stamp usage, record child homelessness, record depressed prices in the housing market, record extended unemployment, and near records in fear of big government, distrust of our leaders and political system, and disapproval in the direction in which the country is heading.

Instead of changing course and adopting pro-growth and economic freedom policies, Obama pledges to give us more of what we do not want:  A New Nationalism.   For what it is worth, Theodore Roosevelt can be forgiven to a degree for falling for National Socialism / Socialism /Progressivism.  After all, collectivism hadn't killed nearly 200 million people yet.  Obama should know better, but classic narcissists believe that they can succeed where all others have failed.


Related Reading:

Big Government Robs The Middle Class Because That's Where The Money Is!

 Give Me Liberty Or Give Me Death...You Can Keep The "Equality"

There Hasn't Been So Much Fire At The White House Since Dolley Madison Saved Some Of Our Most Cherished, National Treasures 

The Non-Existent Stairway To Socialist Heaven In Sweden

Hey, Progs! Wanna Be Like Europe? How 'Bout You Start By Eliminating Estate Taxes?

The Symbolic Presidency

Obama's Neo-Nationalism

Gradually, Then All of A Sudden 

Buffett Rule Fools

Capital Gains Tax Rates Around The World

The Taxman Cometh Differently On Either Side Of The Pond....Although Probably Not For Long Divide

Axelrod Endorses Romney: "Will You Be Fooled, Again?"

Forget The Buffett Rule! The Reagan Rules Rock!