Paul Buchheit repeats the Communist checklist as a cure for cancer causing capitalism in 5 Ways That Raw, Unregulated Capitalism Is Acting Like a Cancer on American Society. [LINK]
His argument is this, in five points:
1. Attacking the Hungry
The uncontrolled growth of investment wealth is diverting resources away from vital programs, effectively smothering them. The average Supplemental Nutrition Assistance Program(SNAP) recipient received about $1,500 for food for the entire year.
To Mr. Buchheit, investment wealth and dollars are equal and exist in a closed system. When one fund grows, the other must shrink. This represents a fundamental misunderstanding of the difference between wealth and dollars. In the Socialist mindset, all things that can exist, do. That ideas, money, energy, and all other resources and commodities can only be moved from one place to another in a “zero-sum gain.” That when the bank accounts of the rich get bigger, they must be stealing it from the poor is a premise of their economic justice argument. This is a false premise perpetrated to demonize wealth and make a claim on it at the same time.
Investment wealth, however, can’t simply be converted into currency and funneled into foodstamps to make full tummies for everyone without penalty. It can be done, in practice, but removing required fuel for real ‘investment’ would deplete the very wealth Buchheit wishes to confiscate for the good of the hungry. Over burden, or tax, investment and your food banks would run dry in a very near and foreseeable future. Why? Because any investment involves a risk and reward analysis. Investors with money to risk are moved to the greatest reward, not the greatest need of taxation. Overtax and you lose your investors, and the wealth disappears.
The rest of his argument centers on the SNAP recipient who could feed a family of four for three and a half months with $1500. So, at the current level of confiscation, the hungry get free food for almost a third of a year. All because someone else decided to risk their own sacred fortune. I’d say that was a generous donation and a far cry from attacking the hungry. But, in the Socialist mentality, generosity can never be trusted from a profiteer. If someone is hungry, someone else must have stolen his right to three squares a day.
2. Suffocating the Students
The corporate style of capitalism allows young college graduates, the bright hope of the future, to work in minimum wage positions while carrying an average of $26,000 in student loans, which accumulated because tuition rose ten times faster than the cost of living, and which now come with interest rates many times higher than the banks pay.
Buchheit needs to take a second look at why tuition costs have been spiraling out of control for decades. The simple answer has two reasons. One, because they can. With demand for product, tuition can rise to meet what the market will pay. When Student loans are readily available, and at much lower interest rates than he claims, artificial demand is created, further inflating the prices of tuition in the entire marketplace. And this low cost money doesn’t even include the plethora of financial aid, grants, and scholarships available to almost any entering college student. In fact, almost every college campus has bureaucratic branch, sometimes even an entire building, devoted to the implementation paper trail of the financial aid industry.
Two, colleges flush with money tend to raise their level of service to meet their income. When the cost of that service rises, it’s passed onto the consumer- just like in any other business. The costs of union labor, building projects, and public safety is always rising. The cost of energy has skyrocketed as well as taxes, retirement, healthcare, and liability. Universities and governments have investments and depend on their returns. So do the retirement and insurance plans of all the workers. But to Buchheit there is no dichotomy here. He fails to recognize his own philosophy will drive up the cost of doing business by taxing the very wealth and investment he derides.
3. Weakening the Children
The disease has been spreading since the 1960s, when life expectancy began to decrease along with increasing health care costs. Capitalism has betrayed our children. A UNICEF study places the U.S. 22nd out of 24 OECD countries in “children’s health and well-being.”
Child poverty, perhaps the main cause of their health problems, is up 50% since 1973, with the rate for minorities three times that for white children.
Our global poverty ranking is shameful. Despite having the second-highest average income for children among the 30 OECD countries, the U.S. ranked 27th out of 30 for child poverty(percentage of children living in households that are below 50% of the median income).
Number three is quoted in full because it’s short, and devoid of meaning. Poverty is Buchheit’s enemy here and makes dubious claims on the general health of children, with no citations, as a direct cause of their detriment. However, in the very next paragraph, he freely admits that the income level of these stricken innocents is second in the world. Life expectancy has not decreased. Unicef’s “well-being” is a meaningless term, defined primarily by a country’s distribution of wealth and a perceived difference in the minimum acceptable way of life in the Member States in which they live. It is completely subjective, and relative to each individual state, so a comparison or ranking serves only as a political tool.
4. Depleting the Taxpayers
The body of our society has been drained of its vital juices by tax avoidance. Loopholes and exemptions cost the public about a trillion dollars a year, and underreported income costs another $450 billion. The total is much more than the cost of our stable but always threatened Social Security program.
Since the recession, Fortune 500 corporations have cut their tax payments in half, even though their profits have doubled in less than ten years.
Finally, it is estimated that between $21 and $32 trillion is hidden offshore, untaxed, with up to 40% owned by Americans. U.S. PIRG estimates that the average taxpayer in 2012 paid an extra $1,026 in taxes to make up for tax havens by corporations and wealthy individuals. The average small business paid $3,067.
Another brief and meaningless diatribe quoted in full due to it’s brevity and lack of foundation. If anything drains vital juices from society it’s taxes, not the opposite. Corporations do not pay taxes. No business pays taxes. Consumers pay taxes because the cost of the tax is built into the cost of the product. Imagine the cost to make a car at $15,000. Ford sells that car to a dealer for $20,000 and makes $5000. Their entire corporate structure is built on a profit of $5000. You, the government, want them to pay a 20% tax on that $5000 because it sounds fair. Now they only have $4000 instead of $5000, but they need another $1000 to keep their corporate engine moving, pay employees, etc., so they bump up the cost of the car to the dealer to $21,250. The cost to make is still $15,000, so they get a profit of $6250, pay the government their 20% and walk away with $5000. They come out even, the government gets their 20% and the buyer of the car gets the satisfaction of knowing their money went to feed some poverty stricken children and a junket to Hawaii for the bureaucrat that fed them. Lets not even think of the person who could only afford a $20,000 car can no longer afford one because the government bumped up the price. This is basic economics, basic mathematics, and surprisingly, not understood by any Socialist espousing the merits of wealth confiscation.
Confiscatory tax policies punish everyone in the chain of capitalism, not just the evil corporations. If a company is forced to eat all costs, that company goes bankrupt. Bankrupt companies employ no people. Unemployed people pay no tax, and buy no products. Investors lose. The stock market suffers. Retirement accounts shrink. Old people die. Babies die. Everyone suffers – specially all those poor people who rely on the tax dollars of others to fund their SNAP program.
The other evil is the untaxed wealth hidden in shelters offshore. Hidden from the righteousness of the common good. Not once would herr Buchheit realize that if the lions were less apt to attack, much of that money would be re-invested into American markets. But that will never happen if the risk outweighs the reward. And if the risk of getting chewed up by a lion is too great, one tends to keep a distance between themself and a lion. Investments, in it’s real meaning, means money that could start businesses, create jobs, increase demand and production, and thereby increase the tax base. Not once would it occur to him that the way to make your government money is to keeps your tax low and negligible and make it up in volume. Buch-envald skipped that lesson in Econ 101 as well.
5 .Paralyzing the Voters
Corporations and Congress are a carcinogenic mix. Voters are rendered useless, like withering organs, as all the attention is given to the greedy mass of nutrient-taking super-rich individuals and companies. A vast majority of Americans want background checks on guns, an emphasis on clean energy, job a stimulus programs, taxes on the rich, and an uncut Social Security program. Yet Congress only hears the ka-ching of campaign contributions. Of the 435 House elections in 2004, 95% of them were won by the candidates who outspent their opponents.
Congress mixes cancer with anything it touches. There’s no reason to believe that Buchheit’s needs outweigh any corporation’s needs. The Socialists certainly don’t have my interests at heart. Everyone want government influence- it’s the nature of people and government. It’s why all government is bad. Necessary, but evil. Frankly, if GE wants to influence congress, and I can buy a refrigerator that keeps my food from spoiling, I’ll buy a GE fridge and let them act as my proxy. When people like Buchheit and his gang want to tell me I can’t have a refrigerator anymore because he gets to tell all of us what to do, then I’m afraid. His type of influence has made our system replete with giveaway programs to sustain non productive people – yet it’s never enough, and he speaks as if the poor are currently getting nothing. The rich already pay more percentage than the poor in taxes, much more. The rich and middle classes are paying for all that subsidized housing, transportation, food and clothing already, yet it’s never enough. And let’s look at his list. Background checks. Congressmen are afraid of not getting re-elected if they press gun control, negating the claim that a vast majority are clamoring for more background checks. Americans will always choose cheaper energy over greener unless it’s in a survey. We want more job opportunities and companies that are hiring, not more stimulus programs. We already have taxes on the rich, and Social security hasn’t been cut. For god’s sake we’re paying more welfare to old people than all those poor, disease ridden children. The elderly have subsidized income, medical care, and meals on wheels. The old people lobby is more powerful than any corporation could ever hope to be.
In addition, the poor pay basically no taxes at all. Their lives are subsidized by the rich and middle classes. They get SNAP programs, earned income credits, free buss passes, free hot lunch and breakfast, subsidized immunizations, property homestead tax rebates, subsidized healthcare programs, reduced registration, utility, and insurance costs through subsidies, and all other social welfare programs to help them through their misery – and they were all voted for by the people who elected members to congress and passed these programs. The Socialist utopia already exists, yet it’s not enough.
Just what would be enough for Buchheit and his ilk? Total world domination and redistribution of all wealth to make everything fair. Not kidding. Say goodbye to your refrigerator.