Saturday, November 27, 2010

Making Money Working


From Claire Berlinski in City Journal:



You see, about a month ago, I asked my mother to bail me out. I knew she’d do it. She’s done it before. She sent me money she’s been saving toward my retirement. I resolved to stop spending money on stupid things. (There was really no excuse for that lamp, Mom, I know. Sorry! In my defense, I was sure there was a genie in it.)


With my mom paying my rent, I’ve been able to charge less for what I write and stay in the black. Voilà, I’m selling a cheaper product (for now) than Reuters and AP. That will teach them where to stuff their “good investment decisions” and their “economies of scale.” I fired the guy who does my odd jobs—it was painful, but it had to be done. So, congratulations to me! I’m making it in this tough business climate, with a little help from Mom. America’s back! And if I’m broke again in a year, I’ll hit her up again. (Don’t forget, Mom, that you really have no choice: no matter what you do, I’m still going to be a huge financial drag on you. If I fail, I’ll end up coming home with all my cats. You don’t want me sleeping on your couch, do you? And you sure don’t want to see what my cats would do to that couch. Antique, I believe it is?)


All of this is, alas, a perfectly accurate description of my financial life. The reader may wonder about my mom’s wisdom in going along with this plan. That’s between me and her—she loves me, and it’s her money, not yours. The money that went to GM was yours, however. And I suppose you must love GM as if it’s your profligate kid, because surely you could not be so credulous as to believe these reports about the spectacular success of the bailout.



There was a rush to buy GM shares last Thursday, when the company, which emerged from bankruptcy restructuring last summer, held an IPO. The company has been drowned in taxpayer cash. It’s going to be fine in the short term. No one should be surprised by this. Anyone—and any company—can get back in the black in the short term if someone gives it a ton of money. And who wouldn’t want to invest in a company that everyone knows won’t be allowed to go down? All the merchants in my neighborhood would lend me money, too, if I asked, confident that their loan would be repaid. A “generous American mom” sounds pretty good to them.


Of course, GM is paying back its new loans, though this doesn’t help investors who hold old GM stock; that’s worthless. By the way, I’m also considering stiffing my creditors. The GM example proves that it will result in an immediate improvement of my balance sheet. GM’s production numbers have been increasing, and mine have, too: it’s a lot easier to write when you’ve got peace of mind. Whether anyone will buy the stuff I’m writing, God knows, but my word count is definitely up, and that, apparently, is the number that matters.


Note that GM is still producing those gas-guzzling pickups and SUVs that no one seemed to want before. Great news for me: I’ll just keep writing about the arcana of Turkish constitutional politics. It’s what the market should want. Turkish politics are fascinating. I don’t know what’s wrong with Americans. If they understood what was good for them, they’d want to be better informed about Turkey. (They’d want that Volt electric car, too. I hear it’s much better for the environment.)


Naturally, I’ll pay my mother back. Here’s how: I’m going to have her put a small percentage of all the money she’s given me in an escrow account, which I’ll call a “working capital” account. Then I’ll transfer the rest of my assets to her. (Good news, Mom: you own seven cats and seven litter boxes.) Then I’m going to use the money from that escrow account to pay her back at an interest rate no one but my own mother would give me. As soon as I empty the escrow account, I’ll declare the loans repaid. What do you mean, that makes no sense? That’s just what the U.S. governmentdid for GM, and no one finds that problematic, do they? Never mind that the cash part of the loan has been repaid from TARP, or that this in fact represents only about 15 percent of the total bailout, or that the rest remains tied up in the automotive equivalent of cats and litter boxes. By the way, I’m thinking of bundling all my liabilities into a separate company, just like GM. I’ll call the company “Some other Claire who can deal with the creditors, never heard of that Claire.”


Read the whole thing here.




Talking of “Bush tax cuts” at this point, as so many seem to do when discussing the change in tax policy set to go into force this coming New Years Day, is beyond absurd.  What’s coming on Jan. 1, 2011 is the Obama Tax Increase — no less than the largest tax increase in our history, courtesy of a president who, last Tax Day, declared that working Americans should be “saying thank you” for the hefty check they had to write Uncle Sam in order to support the eternally vacationing president and his increasingly out-of-control federal bureaucracy.


At a time when copious amounts of smoke and mirrors are required to even create the illusion of an economic recovery in this country, the Obama tax increases are a disaster in the making that will drive the “progressive” knife further into the backs of the American working man and woman.


In their zealous, rigidly ideological desire to both fund their pet programs (like the $800 billion ”porkulus” project) and lavish state trips and to punish the nefarious “rich” who dared to be successful in a country built on merit-based reward, the president and his party — neither of whom are particularly perceptive when it comes to unintended consequences — are setting up the working class not only for an increase in taxes, but a decrease once again in employment and profitability.


The Obama Tax Increases aren’t, of course, limited just to those eeeevil “rich.” Rather, they will directly affect every American who currently pays into our bloated federal system, and in more than one way.


Back in July, Americans for Tax Reform released an outstanding one-pager on what we can expect when the Obama Tax Increases kick in January 1. Here are a few highlights:


- 10% [income tax] bracket rises to an expanded 15%

- The 25% bracket rises to 28%

- The 28% bracket rises to 31%

- The 33% bracket rises to 36%

- The 35% bracket rises to 39.6%


The marriage penalty will be expanded and the child tax credit reduced, and “the capital gains tax will rise from 15 percent this year to 20 percent in 2011. The dividends tax will rise from 15 percent this year to 39.6 percent in 2011. These rates will rise another 3.8 percent in 2013″ (ATR, same citation). Adding further insult and hardship to this is the return of the Death Tax, which is set to jump from 0 to 55%, meaning that over half of what you leave to your children when you die will go directly into Barack Obama and the Federal Government’s pockets. It may be time to start hiding that inheritance cash under a mattress or loose floorboard, unless you really do wish to will Obama & Co. as many rounds of golf and $200m/day Indian vacations as half-plus-five of your legacy can purchase.


The ramifications of the Obama Tax Increases for working class Americans are not limited to money being directly lifted from their paychecks and investment returns by the federal government, though. The fact is, even if the tax increases on the low and middle income portion of the work force (arguable and elastic designations both) are done away with by a lame duck session of the Democrat-led 111th Congress, and increases are put in place only for the “rich,” money — and, worse, jobs — will still be taken directly from working class Americans.


In June, economist Arthur Laffer wrote the following about the looming Obama Tax Increase:


…if people know tax rates will be higher next year than they are this year, what will those people do this year? They will shift production and income out of next year into this year to the extent possible. As a result, income this year has already been inflated above where it otherwise should be and next year, 2011, income will be lower than it otherwise should be.


Also, the prospect of rising prices, higher interest rates and more regulations next year will further entice demand and supply to be shifted from 2011 into 2010. In my view, this shift of income and demand is a major reason that the economy in 2010 has appeared as strong as it has. When we pass the tax boundary of Jan. 1, 2011, my best guess is that the train goes off the tracks and we get our worst nightmare of a severe “double dip” recession.


This was put much more casually and accessibly by Senator-elect Rand Paul (R-KY) on Tuesday night, when he responded to Wolf Blitzer’s on-air inquiry about the wisdom of a tax increase “on only the wealthiest Americans — those making $250,000 a year or more.” Paul said (paraphrase), “We all make a living working for, or selling things to, ‘rich’ people,” so taking more money out of their pockets directly affects the people whose livelihoods depend on that work and those sales.


Spot on.


Unfortunately, extravagant vacations and failed spending programs require capital — and the easiest way for the current administration to gain that is to simply take more of it, at the point of a gun, from the people who currently have it.


As Nathan Wurtzel wrote Wednesday on Twitter, following the president’s amazingly out-of-touch post-election press conference, “People who are scared of freedom bitterly cling to their government and spending” — a play (albeit a true one) on the ivory tower president’s campaign statement that when those wrong-headed, uneducated Americans “get bitter, they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustration.”


Given the penchant this president and his party have already shown for thumbing their collective nose at the wishes of the American people (on the “stimulus,” on Obamacare, etc.), and for referring to those who dare question their policies as “unpatriotic, “dangerous to our democracy” and “our enemies,” it should be no surprise that the outcry of the citizenry, demonstrated both in protests and at the ballot box, would be swept aside by “progressives” who clearly believe they simply know better than everybody else what this country and its people need.



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<b>News</b> Made Meaningless: Meticulous Art by Kim Rugg : WebUrbanist

Working seven days a week, artist Kim Rugg spends five months cutting the letters out of the front page of a newspaper and rearranging them alphabetically.

Fox <b>News</b> Watch - Twitter - Daily Beast | Mediaite

The evolution of news media in light of personalized, instant-gratification social networking sites like Twitter has the landscape evolving at a rapidfire pace. For some in the media, this is a reason to mourn the passing of a more ...

Sun <b>News</b> Gets Green Light: &#39;Fox <b>News</b> North&#39; Secures Broadcast <b>...</b>

Canada is to get a conservative all-news TV channel after the CRTC on Friday granted Quebecor Media a license to launch Sun TV News nationwide. The upstart cable channel, dubbed Fox News North by liberal critics, has the go-ahead to ...


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<b>News</b> Made Meaningless: Meticulous Art by Kim Rugg : WebUrbanist

Working seven days a week, artist Kim Rugg spends five months cutting the letters out of the front page of a newspaper and rearranging them alphabetically.

Fox <b>News</b> Watch - Twitter - Daily Beast | Mediaite

The evolution of news media in light of personalized, instant-gratification social networking sites like Twitter has the landscape evolving at a rapidfire pace. For some in the media, this is a reason to mourn the passing of a more ...

Sun <b>News</b> Gets Green Light: &#39;Fox <b>News</b> North&#39; Secures Broadcast <b>...</b>

Canada is to get a conservative all-news TV channel after the CRTC on Friday granted Quebecor Media a license to launch Sun TV News nationwide. The upstart cable channel, dubbed Fox News North by liberal critics, has the go-ahead to ...


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From Claire Berlinski in City Journal:



You see, about a month ago, I asked my mother to bail me out. I knew she’d do it. She’s done it before. She sent me money she’s been saving toward my retirement. I resolved to stop spending money on stupid things. (There was really no excuse for that lamp, Mom, I know. Sorry! In my defense, I was sure there was a genie in it.)


With my mom paying my rent, I’ve been able to charge less for what I write and stay in the black. Voilà, I’m selling a cheaper product (for now) than Reuters and AP. That will teach them where to stuff their “good investment decisions” and their “economies of scale.” I fired the guy who does my odd jobs—it was painful, but it had to be done. So, congratulations to me! I’m making it in this tough business climate, with a little help from Mom. America’s back! And if I’m broke again in a year, I’ll hit her up again. (Don’t forget, Mom, that you really have no choice: no matter what you do, I’m still going to be a huge financial drag on you. If I fail, I’ll end up coming home with all my cats. You don’t want me sleeping on your couch, do you? And you sure don’t want to see what my cats would do to that couch. Antique, I believe it is?)


All of this is, alas, a perfectly accurate description of my financial life. The reader may wonder about my mom’s wisdom in going along with this plan. That’s between me and her—she loves me, and it’s her money, not yours. The money that went to GM was yours, however. And I suppose you must love GM as if it’s your profligate kid, because surely you could not be so credulous as to believe these reports about the spectacular success of the bailout.



There was a rush to buy GM shares last Thursday, when the company, which emerged from bankruptcy restructuring last summer, held an IPO. The company has been drowned in taxpayer cash. It’s going to be fine in the short term. No one should be surprised by this. Anyone—and any company—can get back in the black in the short term if someone gives it a ton of money. And who wouldn’t want to invest in a company that everyone knows won’t be allowed to go down? All the merchants in my neighborhood would lend me money, too, if I asked, confident that their loan would be repaid. A “generous American mom” sounds pretty good to them.


Of course, GM is paying back its new loans, though this doesn’t help investors who hold old GM stock; that’s worthless. By the way, I’m also considering stiffing my creditors. The GM example proves that it will result in an immediate improvement of my balance sheet. GM’s production numbers have been increasing, and mine have, too: it’s a lot easier to write when you’ve got peace of mind. Whether anyone will buy the stuff I’m writing, God knows, but my word count is definitely up, and that, apparently, is the number that matters.


Note that GM is still producing those gas-guzzling pickups and SUVs that no one seemed to want before. Great news for me: I’ll just keep writing about the arcana of Turkish constitutional politics. It’s what the market should want. Turkish politics are fascinating. I don’t know what’s wrong with Americans. If they understood what was good for them, they’d want to be better informed about Turkey. (They’d want that Volt electric car, too. I hear it’s much better for the environment.)


Naturally, I’ll pay my mother back. Here’s how: I’m going to have her put a small percentage of all the money she’s given me in an escrow account, which I’ll call a “working capital” account. Then I’ll transfer the rest of my assets to her. (Good news, Mom: you own seven cats and seven litter boxes.) Then I’m going to use the money from that escrow account to pay her back at an interest rate no one but my own mother would give me. As soon as I empty the escrow account, I’ll declare the loans repaid. What do you mean, that makes no sense? That’s just what the U.S. governmentdid for GM, and no one finds that problematic, do they? Never mind that the cash part of the loan has been repaid from TARP, or that this in fact represents only about 15 percent of the total bailout, or that the rest remains tied up in the automotive equivalent of cats and litter boxes. By the way, I’m thinking of bundling all my liabilities into a separate company, just like GM. I’ll call the company “Some other Claire who can deal with the creditors, never heard of that Claire.”


Read the whole thing here.




Talking of “Bush tax cuts” at this point, as so many seem to do when discussing the change in tax policy set to go into force this coming New Years Day, is beyond absurd.  What’s coming on Jan. 1, 2011 is the Obama Tax Increase — no less than the largest tax increase in our history, courtesy of a president who, last Tax Day, declared that working Americans should be “saying thank you” for the hefty check they had to write Uncle Sam in order to support the eternally vacationing president and his increasingly out-of-control federal bureaucracy.


At a time when copious amounts of smoke and mirrors are required to even create the illusion of an economic recovery in this country, the Obama tax increases are a disaster in the making that will drive the “progressive” knife further into the backs of the American working man and woman.


In their zealous, rigidly ideological desire to both fund their pet programs (like the $800 billion ”porkulus” project) and lavish state trips and to punish the nefarious “rich” who dared to be successful in a country built on merit-based reward, the president and his party — neither of whom are particularly perceptive when it comes to unintended consequences — are setting up the working class not only for an increase in taxes, but a decrease once again in employment and profitability.


The Obama Tax Increases aren’t, of course, limited just to those eeeevil “rich.” Rather, they will directly affect every American who currently pays into our bloated federal system, and in more than one way.


Back in July, Americans for Tax Reform released an outstanding one-pager on what we can expect when the Obama Tax Increases kick in January 1. Here are a few highlights:


- 10% [income tax] bracket rises to an expanded 15%

- The 25% bracket rises to 28%

- The 28% bracket rises to 31%

- The 33% bracket rises to 36%

- The 35% bracket rises to 39.6%


The marriage penalty will be expanded and the child tax credit reduced, and “the capital gains tax will rise from 15 percent this year to 20 percent in 2011. The dividends tax will rise from 15 percent this year to 39.6 percent in 2011. These rates will rise another 3.8 percent in 2013″ (ATR, same citation). Adding further insult and hardship to this is the return of the Death Tax, which is set to jump from 0 to 55%, meaning that over half of what you leave to your children when you die will go directly into Barack Obama and the Federal Government’s pockets. It may be time to start hiding that inheritance cash under a mattress or loose floorboard, unless you really do wish to will Obama & Co. as many rounds of golf and $200m/day Indian vacations as half-plus-five of your legacy can purchase.


The ramifications of the Obama Tax Increases for working class Americans are not limited to money being directly lifted from their paychecks and investment returns by the federal government, though. The fact is, even if the tax increases on the low and middle income portion of the work force (arguable and elastic designations both) are done away with by a lame duck session of the Democrat-led 111th Congress, and increases are put in place only for the “rich,” money — and, worse, jobs — will still be taken directly from working class Americans.


In June, economist Arthur Laffer wrote the following about the looming Obama Tax Increase:


…if people know tax rates will be higher next year than they are this year, what will those people do this year? They will shift production and income out of next year into this year to the extent possible. As a result, income this year has already been inflated above where it otherwise should be and next year, 2011, income will be lower than it otherwise should be.


Also, the prospect of rising prices, higher interest rates and more regulations next year will further entice demand and supply to be shifted from 2011 into 2010. In my view, this shift of income and demand is a major reason that the economy in 2010 has appeared as strong as it has. When we pass the tax boundary of Jan. 1, 2011, my best guess is that the train goes off the tracks and we get our worst nightmare of a severe “double dip” recession.


This was put much more casually and accessibly by Senator-elect Rand Paul (R-KY) on Tuesday night, when he responded to Wolf Blitzer’s on-air inquiry about the wisdom of a tax increase “on only the wealthiest Americans — those making $250,000 a year or more.” Paul said (paraphrase), “We all make a living working for, or selling things to, ‘rich’ people,” so taking more money out of their pockets directly affects the people whose livelihoods depend on that work and those sales.


Spot on.


Unfortunately, extravagant vacations and failed spending programs require capital — and the easiest way for the current administration to gain that is to simply take more of it, at the point of a gun, from the people who currently have it.


As Nathan Wurtzel wrote Wednesday on Twitter, following the president’s amazingly out-of-touch post-election press conference, “People who are scared of freedom bitterly cling to their government and spending” — a play (albeit a true one) on the ivory tower president’s campaign statement that when those wrong-headed, uneducated Americans “get bitter, they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustration.”


Given the penchant this president and his party have already shown for thumbing their collective nose at the wishes of the American people (on the “stimulus,” on Obamacare, etc.), and for referring to those who dare question their policies as “unpatriotic, “dangerous to our democracy” and “our enemies,” it should be no surprise that the outcry of the citizenry, demonstrated both in protests and at the ballot box, would be swept aside by “progressives” who clearly believe they simply know better than everybody else what this country and its people need.



bench craft company itliano

<b>News</b> Made Meaningless: Meticulous Art by Kim Rugg : WebUrbanist

Working seven days a week, artist Kim Rugg spends five months cutting the letters out of the front page of a newspaper and rearranging them alphabetically.

Fox <b>News</b> Watch - Twitter - Daily Beast | Mediaite

The evolution of news media in light of personalized, instant-gratification social networking sites like Twitter has the landscape evolving at a rapidfire pace. For some in the media, this is a reason to mourn the passing of a more ...

Sun <b>News</b> Gets Green Light: &#39;Fox <b>News</b> North&#39; Secures Broadcast <b>...</b>

Canada is to get a conservative all-news TV channel after the CRTC on Friday granted Quebecor Media a license to launch Sun TV News nationwide. The upstart cable channel, dubbed Fox News North by liberal critics, has the go-ahead to ...


bench craft company spacers

<b>News</b> Made Meaningless: Meticulous Art by Kim Rugg : WebUrbanist

Working seven days a week, artist Kim Rugg spends five months cutting the letters out of the front page of a newspaper and rearranging them alphabetically.

Fox <b>News</b> Watch - Twitter - Daily Beast | Mediaite

The evolution of news media in light of personalized, instant-gratification social networking sites like Twitter has the landscape evolving at a rapidfire pace. For some in the media, this is a reason to mourn the passing of a more ...

Sun <b>News</b> Gets Green Light: &#39;Fox <b>News</b> North&#39; Secures Broadcast <b>...</b>

Canada is to get a conservative all-news TV channel after the CRTC on Friday granted Quebecor Media a license to launch Sun TV News nationwide. The upstart cable channel, dubbed Fox News North by liberal critics, has the go-ahead to ...


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<b>News</b> Made Meaningless: Meticulous Art by Kim Rugg : WebUrbanist

Working seven days a week, artist Kim Rugg spends five months cutting the letters out of the front page of a newspaper and rearranging them alphabetically.

Fox <b>News</b> Watch - Twitter - Daily Beast | Mediaite

The evolution of news media in light of personalized, instant-gratification social networking sites like Twitter has the landscape evolving at a rapidfire pace. For some in the media, this is a reason to mourn the passing of a more ...

Sun <b>News</b> Gets Green Light: &#39;Fox <b>News</b> North&#39; Secures Broadcast <b>...</b>

Canada is to get a conservative all-news TV channel after the CRTC on Friday granted Quebecor Media a license to launch Sun TV News nationwide. The upstart cable channel, dubbed Fox News North by liberal critics, has the go-ahead to ...


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