Black and White Rain Drops wallpapers II, The Royal Trickle Down Dogma

Black and White Rain Drops on Umbrella wallpaper

Black and White Rain on Stalk wallpaper

In my reading today some people are under the impression that the disreputable Michael Steele is the new leader of the Republican party. Steele is no more then a useful idiot. The zealots on the Right whisper the most bizarre sweet nothings into Steele’s ear and he dutifully regurgitatesthem. Another cartoonish example of Conservative identity politics – appearance over substance. Rush Limbaugh remains The Enforcer for whom true Conservatives can’t get down on their knees fast enough. Recently the Real leader of the the Right graced America with his deep insights and proposed cures for our current economic ills, My Bipartisan Stimulus

I say, cut the U.S. corporate tax rate — at 35%, among the highest of all industrialized nations — in half. Suspend the capital gains tax for a year to incentivize new investment, after which it would be reimposed at 10%.

Limbaugh either knows zero about the corporate tax code or was lying. The effective tax rate for American corporations is not out of line for a country with a GDP the size of the U.S. Then there is what corporations actually pay – the statutory rate versus the effective rate,

Effective tax rate much lower than top statutory rate.  Government and independent researchers have long pointed out that the top statutory corporate tax rate is an incomplete measure at best of the burden of corporate taxes.  It does not take into account the generous depreciation rules, exemptions, deductions, and credits (some of which are sometimes termed “loopholes”) that corporations may be eligible for.

For example, a 2005 Congressional Budget Office study found that the effective marginal corporate rate — the rate paid on the last dollar of income earned and arguably the tax rate most relevant for investment decisions — on debt-financed investment in machinery was negative, estimated at -46 percent.[4]  This means that the total value of the deductions that companies may claim for such investment is much larger than the tax they pay.  (Put another way, it means that other taxpayers effectively subsidize the investment.)

Many smaller corporations do not face the top statutory corporate tax rate.  For small corporations, another reason that the top statutory corporate tax rate is an inaccurate measure of the U.S. corporate tax burden is that many of these companies do not face the top rate …

Many of America’s richest coporations pay no income taxes because of loopholes, deductions and tax incentives. Fully two thirds of American corporations pay no income tax. Conservative complaints about corporate taxes like so many of their opinions are based on unjustified beliefs rather then facts. That is partly the reason why fact based arguments in regards to corporate taxes or the so-called death tax fail with the tin eared Right. Beliefs always trump reality. Limbaugh asserts that cutting capital gains is just the ticket. Which is just another trip down delusions lane, 400 richest Americans’ incomes doubled under Bush

The drop from 2001’s tax rate of 22.9 percent was due largely to ex-President George W. Bush’s push to cut tax rates on most capital gains to 15 percent in 2003.

Capital gains made up 63 percent of the richest 400 Americans’ adjusted gross income in 2006, or a combined $66.1 billion, according to the data. In all, the 400 wealthiest Americans reported a combined $105.3 billion of adjusted gross income in 2006, the most recent year for which the IRS has data.

The philosophy behind cutting and cutting capital gains is classic supply side or trickle down economics. Just make sure that America’s dukes, princes and earls stay wealthy and get wealthier. The the enormous economic benefits will trickle down to the average working  Jane and Joe. We’ve had over three decades of this philosophy – a lite version under Clinton – and the economy is in the ditch. More accurately, working class Americans, those with the average household income of around $56 thousand a year have lost ground – in the last eight years, despite some record profits for companies like Exxon – middle-class income has gone down. These are the people that John McCain’s{R-AZ) financial campaign advisor Phil Gramm called “whiners”. It has not been more then two months since we were all treated to a barrage of articles about Republicans in disarray, a party that needed to redefine its self. They have according to their recent actions retreated back into their shell of cognitive dissonance. They do not now, nor have they ever had any real ideas. So confronted with solutions that will probably work, one cannot expect a party that is suffering from several generations of arrested development to start firing off ideas. One’s that will help the country and keep them from becoming the permanent political minority. Thus just crank up the Right’s noise machine shouting disproved and disastrous dogma that appeals to what they have left of a base. They’ve done it before and it turns out its the only trick they know. One aspect of their keep the royals fat and happy campaign is the guilt trip. It is part of the expalantion for Republican support among some working class Americans – if you’re not making it in this economy its your fault – you must be lazy or stupid or fallen under the spell of the the liburl nay sayers. Problems? Hey you just need to work harder or longer hours.

The royal trickle down

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