Obama

The Romney Ad, the Auto Bail Out and China

The political everybody has an opinion not based in fact pundit world is ablaze over a new Romney ad claiming Chrysler is planning on building a plant in China and making Jeeps there. The ad references this Bloomberg article, from October 22nd, which reports Fiat, the majority shareholder in Chrysler, wants to move some production to China.

 

Binders, Stapling Things, Offshore Outsourcing and Women's Work

binderAh, the never ending word gotcha games of Election 2012.   The Internets went abuzz with binders as a symbol of female oppression after the second Presidential debate.   We even have Amazon office binder reviews being carpet bombed with political statements.   While funny as hell, economic oppression of women is not so funny.   Nor is it a word game.

As Our Economy is Outsourced to China the Obama Administration Once Again Does Nothing

Once again the U.S. Treasury and President Obama have refused to label China a currency manipulator, this time by delaying their report on exchange rates until after the election. The excuses abound, with the claim the Treasury Department must assess progress via a G-20 meeting, scheduled conveniently in November, to oh gee, the administration doesn't want to start a trade war.

Tax Facts Show Lower Personal Income Taxes Will Not Create Jobs

taxformsWe've noticed a hell of a lot of political B.S. baffle going on, in particular on business taxes. What happens is politicians conflate small business taxes with the individual income tax and that is due in part to the actual tax code.

The GOP typical claim is a lower top personal income tax rate will allow businesses to hire more people. That is really a lie. Business profits can enable more hiring, tax refunds for hiring and retaining employees can incentivize new jobs, but the personal income tax rates for those who own businesses has negligible effect.

One thing that gets lost in the rancor are business tax deductions. An employee's salary and most benefits are a business deduction. The business owner would not pay taxes on the costs of hiring a new employee beyond the payroll taxes associated with hiring, about 6.2% of salary. The most important element to hiring is demand for goods and services provided by the business, not taxes.

There are four most common business entities in the United States. Corporations, partnerships, S-corporations and sole proprietorships. Partnerships are primarily two types, a limited liability partnership (LLP) or a limited liability company (LLC). There are also other types of businesses, such as RICs, which are glorified investment vehicles with capital gains tax pass through. S-corporations also allow pass through taxes, although not as lenient as partnerships. Below is a graph of number of these firms by type, who had at least one paid employee during part of 2009.

 

type of business 2009

 

Sunday Morning Comics - The Debate Edition

Brought to you by the Comedians - Thank God this election doesn't address the real issues, otherwise we'd be out of business
Cup O' Joe

 

Good Morning! Rise and Shine! Get that Cup O' Joe...
break out the O.J....hang out with the pooch...time to check out the debate funnies. Both candidates have two minutes to be parodied.

 

The Rumble 2012 - Jon Stewart vs. Bill O'Reilly

 

When in Doubt, Spin It Out - The Spin and Lies of Manufacturing

The Obama administration, with much fanfare, announced a WTO complaint filed against China on auto parts.

The Obama Administration is committed to protecting the rights of nearly 800,000 American workers in our $350 billion auto and auto parts manufacturing sector.

Export subsidies are prohibited under WTO rules because they are unfair and severely distort international trade. China expressly agreed to eliminate all export subsidies when it joined the WTO in 2001. China benefits from international trade rules and must in turn live up to its international obligations.

While this action is long overdue, the realty is this administration has been complicit with China, refusing to label them a currency manipulator. Additionally the Obama administration has passed even more bad trade deals and is working on a mega bad trade agreement, the TPP.

While Chinese auto part imports have surged 25% in the last two years, so has the overall manufacturing trade deficit. Below is the percent change from a year ago in the manufactured goods trade deficit. This trade deficit has increased 14% from one year ago and 26.3% from two years ago.

manufactured goods per chg 1yr

A Select Comparison/Contrast of the Democratic & Republican Platforms on Issues Important to U.S. Workers

With the political convention rhetoric soaring and political ads about to carpet bomb the airwaves, we thought it might be useful to comparison/contrast the Democratic and Republican platforms and show for U.S. workers both have policy agendas which will damage the middle class. The Democratic platform is here and the Republican one, seemingly not even indexed by Google, is here, in large pdf form. Let's take economic and labor issues and compare them side by side.

 

Comparison of Democrat and Republican Platforms 

Issue

Democrat

Republican

U.S. Worker Choice
University Green Card ATM Yes Yes Both Bad
More Guest Worker Visas Yes Yes Both Bad
China Currency Manipulator No Yes GOP
Bad Trade Deals Yes Yes Both Bad
Financial Reform Yes No Dem
Student Loans Yes No Dem
Outsourcing Yes Yes Both Bad
Unlimited Migration/Immigration Yes No GOP
Unions Yes No Dem
Taxes on the Rich Yes No Dem

 

FHFA Firestorm!

firestormThe FHFA just pooped on half a million Americans and denied those underwater on their mortgage to obtain partial debt forgiveness. Millions of American homeowners holding out hope are outraged. Acting FHFA director Ed DeMarco:

Today, I provided a response to numerous congressional inquiries as to whether the Federal Housing Finance Agency (FHFA) would direct Fannie Mae and Freddie Mac to implement the Home Affordable Modification Program Principal Reduction Alternative (HAMP PRA). After extensive analysis of the revised HAMP PRA, including the determination by the Treasury Department to begin using Troubled Asset Relief Program (TARP) monies to make incentive payments to Fannie Mae and Freddie Mac, FHFA has concluded that the anticipated benefits do not outweigh the costs and risks.

Given our multiple responsibilities to conserve the assets of Fannie Mae and Freddie Mac, maximize assistance to homeowners to avoid foreclosures, and minimize the expense of such assistance to taxpayers, FHFA concluded that HAMP PRA did not clearly improve foreclosure avoidance while reducing costs to taxpayers relative to the approaches in place today.

Immigration Banter Leaves U.S. Workers in the Dust

cheap labor flowsHouston, we have a problem. We need jobs. The never ending political banter on immigration is a droning inane brew of special interests. One thing always is constant. At the back of the pack is America's middle class. We even have various groups supposedly representing U.S. labor who seem to be interested in illegal immigrants instead. Even worse, we have numerous lobbyists spinning out economic fiction, trying to claim offshore outsourcing is good for America or displacing U.S. workers with foreigners is somehow good economically. Neither is true. Worker displacement is worker displacement and if anyone is alive these days, the employment statistics say it all. Indeed we saw the foreign born getting majority of the jobs from 2008-2010. We need jobs for U.S. citizens, American workers. We also need a big legal rubber stamp proclaiming U.S. workers are preferred for all jobs within our shores.

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