For instance, you’ll hear a lot from liberals about how the executives at health insurance companies are overpaid and shouldn’t be making that much while people suffer. Of course, they ignore the facts of profit margins and actual compensation package details when making these claims.  But they are liberals so for them using facts is me having too high of an expectation. As Trying To Grok has noted in a couple posts, you’ll never hear anything from liberals for the government to tax, regulate or engineer the market-dictated salaries or profits of Democrat-aligned companies such as Google. Hmmm, funny how that goes.

But let’s take a look at who’s making what in these industries. For the purpose of this example I’ll use Cigna since they are a major company in the health insurance market that’s come under fire during the topic of healthcare reform.

First, what were the salaries of the CEOs of Cigna vs. Google.

Edward Hanway, CEO Cigna -   2008 Total Compensation: $12,236,740 (including a base salary of $1,142,885)

Eric Schmidt, CEO Google – 2008 Total Compensation:  A base salary of $1; and other compensation of $508,763; Oh, and let’s not forget his stock options in Google which have allowed him to amass $5.5 BILLION in his past compensation package of 12.5 million shares.  Schmidt currently no longer accepts stock options in Google, but he’s set as one of the world’s richest men.

It’s not that Hanway hasn’t amassed some degree of wealth over the years as Cigna’s CEO. The last few years his compensations have been $22 million in 2007 and $15.2 million in 2006.

But the issue is IF you’re going to start taxing executive pay, which executives do you tax? What industries do you tax – the ones that accrue the most wealth from the economy? Who gets to make those taxation classification decisions? Why do they get to make those decisions? And since those decisions will be subjective in manner anyways, isn’t that a reason for them not to be made at all (and thus salaries shouldn’t be engineered by the government)?

I mean if we just look at the years between 2006 – 2008, CEO Schmidt of Google has a wealth that far surpasses even the majority of companies in this world. He certainly seems like he can afford to be taxed more on his wealth more so than Hanway.

But a liberal may say Cigna profits too much from their own industry. Well, what about market share – shouldn’t that show how much Cigna is really the one taking America to the cleaners. Ummm, not so much.

Google has a near majority in some of the services it provides. In the industry of Search Engine Marketing, Google owns around 70% of the SEM market share. SEM is roughly around a $20 billion industry in terms of revenue, set to move upwards of $26 – $30 billion by 2013.

Cigna on the other hand covers around 11.7 million people with its health insurance plans. If you figure 165 million people are currently under a form of private insurance, 11.7 million of those people equate to around 7% of the industry market share.

And to those liberals who say that healthcare is a right. Well, Cigna doesn’t offer healthcare. It offers a risk policy aka insurance. And a service of providing an insurance policy should not be held to a higher moral ground in service retention than a search engine’s services. Sorry, I have a heart – I just don’t let it bleed for unnecessary, illogical sentiments.

Also, let’s look at net profit margins to see how much of America’s hard-earned dollars is being hoarded between Cigna vs. Google:

For 2008, Cigna’s net profit margin was 1.51% (profiting only $292 million out of $19.1 billion in revenue)

And guess what Google’s was – 19.39% (profiting more than $4.3 BILLION out of $21.8 BILLION in revenue)

Gee, it sure seems like Google is a dominant monopoly with more greed to be taxed. 70% vs. 7% market share? 1.51% vs. 19.35% profit margins? Makes someone wonder why liberals are fussing so much over companies like Cigna when they could get more $$ for their tax out of companies like Google.

That’s my new mantra to argue back at liberals who somehow miraculously forget that at the end of the day people are inherently selfish and will do within their means possible to avoid threats to their well-being INCLUDING the money they EARNED. It’s like I get it because remember I used to be a liberal. Liberals honestly think who can argue with the concept, “well if you tax more on people who can afford higher taxes then you’ll get more tax revenue and then you won’t have to tax those who make less.”

Yes, great in theory. BUT it’s in theory only that it makes any sense. Keep in mind, sitting from a comfy non-application couch in academia constrains one to not understand how this theory is easily debunked in what I like to call – The Real World.

The problem is that most liberals only look at one side of the economics picture. They only see how supposed increased taxes will mean more revenue for the government. They see the economy as static, not the truth in that our economy is dynamic adapting to new parameters to the corporate environment. Unfortunately liberals don’t look at the affect taxes have on the economy, on venture capitalism, on business development, on R&D, on company employment, etc. They just look at the idea (remember IDEA only) of theoretical increased revenues for expanded failing government programs. Looking at just one side of the entire economic picture when it comes to tax policy is what Henry Hazlitt calls bad economics. It would be the same if a company would increase prices on products and argue “hey, if we increase prices, that’s more in profits” but then they don’t look at the affect of less demand due to higher prices. They just assume the demand/revenue will remain static still being there willingly adapting to the price increases.

See when you tax those who invest the capital in this country, run businesses, etc. they for some reh-reh-reason don’t like it. No matter how much Smancy Pelotox gets up there and says “You’ll take this tax hike and you’ll LIKE it!” people are going to shift their money to avoid the most taxes possible because they already pay the majority of taxes.  And to the liberal bonehead argument “well, Obama is going to tie up the loopholes people use to hide their taxable income.” Newflash nitwit – there are always going to be loopholes. A loophole is not something a President Unicorn Princess can make disappear with a flick of his wand, ie teleprompter. No, a loophole is something people pay a tax lawyer hundreds of dollars by the hour to find or have their tax return fit into. And the tax code makes it easy by being ridiculous in length and treated as a living document – no, THANK YOU Democrat Charlie Rangel!

Also to further illustrate the fallacy of liberal tax theories, all you have to do is look at the history of tax collections. (via The Heritage Foundation)

Good tax policy has a number of interesting side effects. For instance, history tells us that tax revenues grow and “rich” taxpayers pay more tax when marginal tax rates are slashed. This means lower income citizens bear a lower share of the tax burden – a consequence that should lead class-warfare politicians to support lower tax rates.

I know, how silly of me to look at the revenue statistics and research studies of actual tax policy application (and NOT tax theory studies), but according to the Tax Foundation tax breaks to the lower income earners actually hurts revenues for the government. But tax breaks for the top income earners (and those paying nearly 80-90% of ALL tax revenue) does spur on economic growth, thus improving tax revenue gains for the government. By the way, take a look at the study and note the words “actual experience of taxpayers”. Again, that pesky logic and application coming into play.

As Jack Bauer would say – DAMMIT!

A recent study analyzed the actual experience of taxpayers as tax rates were reduced in 2001 and 2003. This empirical study found that lower tax rates helped to reduce the distortions in economic decision-making caused by high tax rates. Moreover, the lower tax rates induced taxpayers to report more taxable income, which means that a sizable portion of the revenue cost of the lower tax rates was offset by a tax-induced expansion of the tax base.

And as if you need even further proof, Ace of Spades throws it up this morning from an article in The Wall Street Journal:

And the evidence that we discovered in our new study for the American Legislative Exchange Council, “Rich States, Poor States,” published in March, shows that Americans are more sensitive to high taxes than ever before. The tax differential between low-tax and high-tax states is widening, meaning that a relocation from high-tax California or Ohio, to no-income tax Texas or Tennessee, is all the more financially profitable both in terms of lower tax bills and more job opportunities.

Updating some research from Richard Vedder of Ohio University, we found that from 1998 to 2007, more than 1,100 people every day including Sundays and holidays moved from the nine highest income-tax states such as California, New Jersey, New York and Ohio and relocated mostly to the nine tax-haven states with no income tax, including Florida, Nevada, New Hampshire and Texas. We also found that over these same years the no-income tax states created 89% more jobs and had 32% faster personal income growth than their high-tax counterparts.

Check that out again: no income taxes = 89% MORE jobs and 32% more wealth growth for individual citizens. Yeah, higher taxes are totally way better for the economy. Like, totally. (rolling eyes) It’s like people forget that our businesses are competing not only on a national scale but a global one. So when you have a company that’s thinking about expanding operations, guess what??? they’re considering things like overhead costs. Guess what is the #1 contributor to overhead costs – T.A.X.E.S.  Liberals should take note on Gov. Perry’s (R-Texas) outlook:

One last point: States aren’t simply competing with each other. As Texas Gov. Rick Perry recently told us, “Our state is competing with Germany, France, Japan and China for business. We’d better have a pro-growth tax system or those American jobs will be out-sourced.” Gov. Perry and Texas have the jobs and prosperity model exactly right. Texas created more new jobs in 2008 than all other 49 states combined. And Texas is the only state other than Georgia and North Dakota that is cutting taxes this year.

And for good humor, here’s a joke I heard this past election cycle that better sums it up:

The Tax System – Explained With Beer

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100.

If they paid their bill the way we pay our taxes, it would go something like this:
* The first four men (the poorest) would pay nothing.
* The fifth would pay $1.
* The sixth would pay $3.
* The seventh would pay $7.
* The eighth would pay $12.
* The ninth would pay $18.
* The tenth man (the richest) would pay $59.

So, that’s what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve.

‘Since you are all such good customers,’ he said, ‘I’m going to reduce the cost of your daily beer by $20.’
‘Drinks for the ten now cost just $80.’

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men – the paying customers? How could they divide the $20 windfall so that everyone would get his ‘fair share?’

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so:
* The fifth man, like the first four, now paid nothing (100% savings).
* The sixth now paid $2 instead of $3 (33%savings) .
* The seventh now pay $5 instead of $7 (28%savings) .
* The eighth now paid $9 instead of $12 ( 25% savings).
* The ninth now paid $14 instead of $18 ( 22% savings).
* The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

‘I only got a dollar out of the $20,’ declared the sixth man. He pointed to the tenth man, ‘but he got $10!’
‘Yeah, that’s right,’ exclaimed the fifth man. ‘I only Saved a dollar,too. It’s unfair that he got ten times more than I!’

‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back when I got only two? The wealthy get all the breaks!’

‘Wait a minute,’ yelled the first four men in unison. ‘We didn’t get anything at all. The system exploits the poor!’

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

For those who understand, no explanation is needed.

For those who do not understand, no explanation is possible.

I. Need. A. Life.

But in my latest debate, this point has been cracking me up.

“The top 5% have had the sweetest deal in recent history. Obama’s push has been to return to the Clinton days, which themselves put the Reagan days to shame in terms of upward wealth redistribution that alleviated tax burden on the wealthiest, thus increasing the tax burden on most working Americans.”

Take a gooood look at that argument point. What’s missing? Whaaaaaaaat’s missing? Oh yeah! Those things called facts and figures. (rolling eyes)

A conservative male these days could totally use this as their new pick up line by the way its screamed from the rooftops by liberals – “Give me your phone number if you’ve heard this, but aren’t the rich getting a better tax deal with Obama than under Reagan.”

Okay, maybe it’ll only help out a conservative male if he’s talking to a liberal woman. What was that? The sound of real, grown men in the military shuddering! LOL.

Anystraightmanscaredcelibate, I love how liberals are using this point to defend their Savior-In-Chief (Save Me, Obama! Saaaaaaaaave ME!) on taxing the rich. Basically what they’re trying to say is “don’t worry about Obama’s tax hikes on the “rich” because nearly 30 years ago that same income bracket (not necessarily the same people) had the same tax burden.” And they’re saying this without any statistics, without any correct comparisons between Obama’s tax program and GW Bush’s, and typically base their “point” on feelings/emotions.

Errrrrrrr, an illogical liberal says what?

Here’s what the liberals don’t tell you and I’m going to get all Neal Boortz on you so just watch out. The next time a liberal throws this out on their Facebook status or at the local beatnik coffee shop, respond with this…. (via the Tax Foundation)

The top 5% have the sweetest deal in history? Surely you jest. The top 5% earn around 30% of the total income out there but pay for nearly 55% of the total income taxes. The bottom 50% of tax payers earn 14% of the total income yet pay less than 3% of the income tax revenues. The income spread between the two groups is 16%. But the tax burden spread is 41% against the shoulders of the top 5% of earners and you think that’s unfair on the bottom 50???? Plus if you look at the tax cuts under Bush the amount of tax revenues collected went UP among the top 5% earners (+11% from 2003-2006; +12 from 2002-2006) and went DOWN among the bottom 50% of earners (-14% from 2003-2006; -15% from 2002-2006). So the idea that well, the rich are still getting the good deal under Obama compared to Reagan so people shouldn’t whine about it, well I don’t think that’s a strong argument based in statistics nor is it giving a proper comparison against GW Bush’s administration (where the comparison should be). And BTW, the “working class” actually paid less under Bush than under Clinton as well.

And if you want more, I’ve got all the whole myth about the Bush tax cuts only benefitting the “rich” mapped out on another post.

Two-thirds of U.S. voters (66%) think President Obama is likely to raise taxes on people who less than $250,000 per year. That figure includes 47% who say he is Very Likely to do so.

I mean this isn’t hard to figure out when the HSIN (Head Spendocrat In Charge) is authorizing more money in government spending than any other U.S. president COMBINED. But this is also a nation where 49% of the public has also been polled as believing that government has an independent source of revenue outside of taxation on its own citizens. Soooo, not all of us are the sharpest tool in the box, you know. And to put it in perspective I was there once too – the running joke in my family the last year has been “Oh, remember that time you almost voted for John Kerry.” Ummmm….Hardy, har, har!

All kidding aside, I once believed these things as well, until I started to educate myself and wha-freakin’-LAH, the beginning of becoming Un-Liberaled. That said, I’m glad at least people are catching on. Wish they would have done so pre-Nov. 4, 2008. But, eh, a girl can dream. Besides, WHO. AM. I. to expect people to be bothered with things like logic, researching govt. spending failures, and examining potential economic policy effects when they’ve got “Hope ‘n Change with Kool-Aid Shots for All” rallies to get to.  

But here’s the bet I’m laying down. I don’t think Obama will initiate new taxes until his 2nd term (if he’s even elected). He’s always been what I call An Ambition Politician (pronounced usually with hands formed like guns shooting out the coolness douchebag factor – b-b-b-ewbewbew, b-b-bewbewbew). And so he’s not going to get elected in 2012 if he invokes major tax hikes. George H.W. Bush -anyone? anyone?

But I think Obama’s going to let ALL the Bush Tax cuts expire. Mind you the tax cuts apply to most people making over the mid $40k range, but Obama’s “promise” was to only let them expire on those cuts applied to the “rich” at $250k+. And we all know how good Obama is about keeping his campaign promises. REMEMBER – he also promised to go “line by line” in the budget and that lasted all of three seconds into his presidency. Cue Letterman’s whine – he’s tryyyyyyyyying, people. He’s tryyyyyyyyyyying. Sniffles.

I’m keeping my eye on the ball though. Estimated bet – Obama will let all the Bush Tax Cuts expire and sell it on the basis of the overall good or need for the economy. By 2010, when the taxes are scheduled to expire, I think the economy’s rollercoaster will have slowed down (not recovered) and he’ll pounce on slim advantage in order to expire all the tax cuts. Critics will blast him. Drunk supporters will surge like Lancelots to defend him with “we’ve got to pay for these things, people!” Then countdown on the “campaign rhetoric” excuse…in…3…2…1.

And if you think SCHIP is actually helping children getting healthcare, think again. Here’s an article on how well the last consideration for SCHIP ended up with results.

In some states, SCHIP enrollment could fall while Medicaid enrollment increases. If the incoming Obama Administration revokes the Bush Administration’s guidelines to prevent the public program “crowd-out” of existing private health coverage, a handful of wealthier states would be able to expand SCHIP to children in higher income families while children at lower income levels in poorer states would be left uncovered.

No worries though, I also blame all the Republicans who voted for this bill as well. Guess who didn’t vote for the bill? McCain! How do you like them apples??? Michelle Malkin’s got the full story. Along with the bill also comes the elimination of standards put into the first bill to lessen the capabilities of illegal immigrants taking advantage of healthcare paid for by legal citizen taxpayers. 

Obama’s praise for the provision loosening of eligibility for legal immigrants and their children (a “first step” toward allowing illegal aliens to partake of the bounty) garnered the most applause from the audience and members of Congress.

Check out the vid at the link of Rep. King who articulates the point very well and calls out Obama on his hypocrisy when during the debates insisted he was the better candidate over McCain because folks making under $250k would see no NEW taxes of any kind. I guess that was just “campaign rhetoric” again.  How DARE voters hold a politician to their campaign promises! Don’t think these new tobacco taxes affect those making less than $250k. Check this out then from HealthCare BS Blog.

The study shows that elasticity of demand for tobacco products depends largely on socioeconomic status. As prices go up, better off smokers tend to quit. However, for smokers further down the ladder, price doesn’t have the same effect.

This is very similar to FDR raising taxes on liquor and tobaccoto help fund his failing New Deal. Helping out the poor by passing huge taxes on the products used mainly by the lower and middle economic classes. Can you feeeeeeeeeel the brilliance in Keynesian economics? All it creates is a cycle effect in taxes and govt. spending that produces nothing but confusion to cloud people’s perception of the big picture.  It’s the old bait and switch – sell the policy as if you’re about helping the needy and lower economic class and that you’re going to make “the rich” pay their “fair” share in taxes. Oh but then forget to mention when it comes time to craft the actual legislation that the funding is coming by taxing goods & services most used by the lower economic class. 

And how these politicians are still elected into office AMAZES me!