Friday, July 20, 2012

Romney's 3 R's: Returns, Relevancy, & End Runs

 Or, The Disintegration of American Ability to Tax the Elite 

There are two separate Romney entities, one being the venture capitalist Romney, and the other the private equity Romney. ("The Two Faces Of Mitt Romney and Bain Capital", Ezra Klein, Washington Post 2012)
Now Romney has doubled down in response to demands for more than only one year's tax return, an anomaly that no other presidential candidate in recent memory has done since Ross Perot refused to release any, when Perot's rate was guesstimated to be less than 7%. Ah, Mittens has been involved in the murky world of offshore banking since he started Bain Capital in 1984, when many of the investors who helped fund his start-up did so through Panamanian registered companies. You know, that place called "Isthmus" in the 1989 James Bond movie, "Licensed to Kill".

Bain Capital Started with help of offshore investors

What's in Romney's Offshore Accounts

Now Romney pays no more than a 15% tax rate on monies he collects from the Bain group as highly contested "carried interest" that is normally paid to investment managers, but he claims to have left the firm in 1999.
"  Romney is the poster boy, the best argument, for taxing this profit share as ordinary income.." {ed note: Lee Sheppard is a contributing editor at the trade publication Tax Notes}
" Romney’s financial disclosure form lists 25 of them in an open-ended category, “Over $1 million,” including So­lamere and Elliott, and they are not broken down further. Romney hides behind a disclaimer that the fund managers “declined to provide such information” about their underlying assets. Many of these funds are set up in tax havens such as the Cayman Islands, where a confidentiality law states that you can be jailed for up to four years just for asking about such information. " (Shaxson, Vanity Fair August 2012).

The only tax return that Romney has released, his 2010 return, does not show the offshore accounts. The IRS form TD F 90-22.1, Report of Foreign Bank and Financial Accounts as of this date unknown to this author.

Follow the Money

 Romney's Bain IRA reportedly contains up to $102 million (who's counting ?). How is this so ? Tax returns may not explain much here. So, all these elaborate attempts at secrecy and offshore stashes begs the question: what was this moneyed power elitist thinking ?

" Romney described himself as driven by a core economic credo, that capitalism is a form of “creative destruction.” This theory, espoused in the 1940s by the economist Joseph Schumpeter and later touted by former Federal Reserve Board chairman Alan Greenspan, holds that business must exist in a state of ceaseless revolution....Far better, Romney wrote in his book No Apology, “for governments to stand aside and allow the creative destruction inherent in a free economy.”

‘How people are taxed, who is taxed, and what is taxed tell more about a society than anything else.’
(C. Adams (1993). For Good and Evil. The Impact of Taxes on the Course of Civilization. London: p.21)

  The final point to be made about a presidential candidate like this is to avoid him at all costs. In addition to his extreme cautiousness to completely cover up his personal finances and proclivity to ship US jobs overseas and prefers to make foreign investments, I keep stressing that he's a foreign policy neophyte surrounded by the same neocons straight out of the Bush administration, but it looks like the polarized dividing lines between what portion of the independent voters are left are already drawn, and that pool has shrunk considerably.

Joseph Tainter, in his treatise The Collapse of Complex Societies states that "..too many scholars offer facile explainations of societal collapse by assuming...{that} in the face of collaspe:
The Dinosaur, a large-scale society in which resources are being depleted at an exponential rate and yet nothing is done to rectify the problem because the ruling elite are unwilling or unable to adapt to those resources' reduced availability: In this type of society, rulers tend to oppose any solutions that diverge from their present course of action. They will favor intensification and commit an increasing number of resources to their present plans, projects, and social institutions"

 Tainter : ‘Will we find, as have some past societies, that the cost of overcoming our problems is too high relative to the benefits conferred, and that not solving problems is the economical option?’ (Tainter, Joseph, The Collapse of Complex Societies, 1990, Cambridge University Press, p213).

  But that sounds so much like the current Teapublican controlled house of representatives that the term "Dinosaur" sticks easily to that formerly highly respected body of lawmakers, or what were primarily lawmakers. Now they rarely produce any bills relevant to this economy or even to effect a compromise to achieve anything on the only issue close to their heart (besides reproductive rights repression), the deficit. 

 So this is the de facto leader of the power elite, whose tax evasion and avoidance supplement voter suppression and out right purchasing of elections. This leaves us with a moral standard dragging in the dirt of modern politics in the wake of our loss of actual universal suffrage due to the Citizens United decision. We the People vs. we the corporations. God save us all, and God save the United States.  

For further reading  
in Toynbee comparative history:

The process of manufacturing an intelligentsia is still more difficult to stop than it is to start; for the contempt in which the liaison-class is apt to be held by those who profit by its services is more than offset by its prestige in the eyes of those who are eligible for enrolment in it; and the competition becomes so keen that the number of the candidates rapidly increases out of all proportion to the number of opportunities for employing them. When this stage is reached, the original nucleus of an intelligentsia which is consoled by being employed becomes swamped by the adventitious mass of an 'intellectual proletariat’ which is idle and destitute as well as outcast. p157

The symptoms of unrest in the 'intellectual proletariat' of Japan thrust themselves upon the attention of the writer of this Study during a visit to the Far East in the autumn of 1929. The Japanese Government's extreme nervousness about 'dangerous thought’ was exhibited to the traveller when, upon landing in Japan, he was required, as part of the regular passport and customs procedure, to make a complete return of any books and pamphlets that might be included in his luggage. Evidently the Japanese authorities believed that some important element in the population was particularly prone to catch the mental infection of foreign subversive ideas; and, equally evidently, they were terrified about the possible consequences of the disease if once it did gain a hold upon, the Japanese body social. Some of the grounds for this anxiety on the Japanese dominant minority's part were soon revealed to the writer when, in the university town of Kyoto, he was informed that, out of the last graduation-class of students, only 20 per cent, of the young men and women had succeeded in finding employment. Since a majority of the students were the children of poor parents—mostly workers on the land—and had been given their university education (which incidentally unfitted them for pursuing their ancestral calling) at the cost of heavy sacrifices and privations on their family's part, the failure of their education to bring in any economic return was nothing less than a social disaster. p158

How is this apparent spiritual barrenness of our Western internal proletariat to be interpreted? 

On first thoughts we might perhaps be tempted to draw an encouraging conclusion. We might account for this dearth of creative achievement by the fact, which we have already observed,  that some of the finest of the plants that have been uprooted in our Western garden have managed hitherto to strike root again on virgin soil. In other words, some of the most promising of the recruits to our Western internal proletariat have been prevented from making any appreciable contribution to a new proletarian culture by the fact that they have been successfully reabsorbed into an unruptured Western body social; and this is a fact on which we may surely congratulate ourselves; since it may be taken to mean that, in our Western Society, the schism between Proletariat and Dominant Minority has been partially repaired, and that the breakdown of our civilization (if it has broken down) has been to that extent retrieved. p188 

(Arnold J. Toynbee, a 12-volume magnum opus A Study of History (1961))


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