23 October 2011
It's the Banks, Stupid! It's Jobs, Dummy!
The primary obstacle against reviving of our nation's economy is the banking industry's control of credit. I could get behind that slogan. Calls for reducing or eliminating regulatory controls on banking and other financial services are, at least in the public political arena, split between the haves and the have-nots.
Why are so many people pushing for less regulation when they do not have sufficient savings or other forms of wealth (land, inheritance, stocks, bonds, etc.) to have a worry-free retirement or to pay for their own health care? Why are there poor-White Republicans and second-generation Latinos embracing the ways and means that benefit only the wealthiest people in the country?
Why are some financial commentators lauding politicians who are proposing radical changes to the federal tax code such as a flat tax? Most people already pay flat taxes or sales taxes in their home states? Cities also levy flat taxes through additional sales taxes. Why don't the sales taxes fund government sufficiently? When I buy a box of bandaids for $4.00, the retailer collects an additional state sales tax of 34¢, so I pay $4,34 out of pocket. No one escapes the sales tax on most retail goods. If the customer did not pay the extra 34¢, the retailer would still have to pay 34¢ to the state. State tax code allows the seller to collect sales tax from the customer, but the state says that the tax is levied on the amount of the seller's price. Sales tax revenue is not the customer's responsibility.
When filing California state income tax forms, there is a place for the taxpayer to enter the sales tax amount avoided by purchasing goods on the internet for which the internet seller did not charge California sales tax. Essentially an honor system, if the internet retailer has no business presence in California other than the Internet, there is no basis for the state to impose a sales or use tax on the seller. If the seller does maintain a business presence, has a license to do business, then the internet seller must report the sale and pay the sales tax to the state. Amazon.com is currently contesting this policy. Should Amazon.com win, then the State has to revise the tax code to place the sales tax burden on the internet customer rather than on the vendor.
Another form of flat tax is the property tax. In California, county assessors use 1.3 percent of the property's market value (reset whenever property changes owners to the selling price), which can be adjusted within a 2 percent range without voter approval. In addition, cities and special voting districts ask voters for additional taxes to repay bond issues, to pay for additional public fire services, to pay for anything the local government sees itself unable to pay for out of their existing revenue streams. The result is a flat tax amount added to the property tax assessment. When I owned a condo in Oakland, California, one third of my property tax payments were flat tax add-ons resulting from voter approvals that had nothing to do with the assessed value of my property.
Watching CNN-TV this morning, I noted that the invited guests were very enthusiastic about a flat tax, referring to Steve Forbes' proposals during his unsuccessful run for the Republican nomination. Following that discussion was another pair of invited commentators opining on the OWS movement and sit-ins around the country. Each commentator took a very conservative financial viewpoint for describing this popular phenomenon. "What do they want?" "Are they more favorable to the Democrats?" "Who are they?" were questions raised but not answered. Not answered because to date no one voice from these groups of protestors has told the press why they were there--except that individuals all seem to have different reasons for being there. Poor media.
I wonder if this growing physical statement of dissatisfaction can be rendered into a single agenda. Some protestors seem to be calling for equal opportunity while others are advocating equal outcomes. A common theme is their perception of the current American way of life is unjust, that neither equal opportunity nor equal outcomes are possible. What could this mean?
In employment, salaries are stagnant except at the highest echelons of an organization. If middle and lower echelon job salaries were to rise at rates deemed "fair" vis à vis senior managers' and executives, the companies would move their operations overseas or to a non-union state so that costs would be lower. So how is a person supposed to find a job with a better wage? If in their current jobs they have vested retirement benefits, health care insurance cost-sharing, or tenure, the risk of changing jobs becomes complex and stressful, especially because of their partners' job status and location, their children's schooling, and the first-in-first-laid off status on the new job.
Even if one can go to school part-time online or at a local college while working full-time, the required physical and mental effort to become more marketable in the higher paying job markets is very high. I cannot put into words how much I admire the single parents who manage to work one job, be a parent and go to school at the same time.
I've heard there are 45 million unemployed persons today in the US, but there also are 3.1 million jobs employers are unable to fill from native American applicants. So, there are calls for changing the Immigration Law to attract and hire foreign nationals to fill these jobs. So, among the OWS are the unemployed who see the Immigration Law as unjust because it is not being enforced, as evidenced by the number of illegal immigrants working in the US. Of course, who is employing undocumented workers and for what wages and kinds of jobs is lost in the overall emotion of injustice toward those who have played by the rules and are being ignored. If the current Immigration Law were adhered to by US employers, I really wonder how many legal residents would leave their present location, where they cannot find a job, and relocate to work in jobs now filled by undocumented workers. People did move in the Great Depression, but we have not seen comparable migrations in the Great Recession. Why?
Others among the OWS believe that the Immigration Law is unjust when families are split up due to some members being documents and others not, when children of undocumented persons are allowed to attend public schools and receive private funding for attending post-high school educational institutions. The term "anchor babies" has currency in today's political discussions, especially in our southern states, that I find offensive and racist. The Constitution accepts de jure and de facto full citizenship to anyone born in the United States, but Immigration Law and state laws denigrate and punish such citizens should one or both parents be undocumented residents at the time the child is born.
[Side note: As more and more states begin to define the biological status of personhood as "at inception" or "at conception" (I fail to know the difference) will Immigration Law require all women of child-bearing age to take a pregnancy test before obtaining a visa to enter the United States, Puerto Rico, or the other U.S. territories? Once in the US, what if that woman becomes pregnant? Even if she leaves the US, would not her child be born a US citizen by reason of birth? Just asking....]
Free, public education has enabled America to aspire to being a nation of literate citizens, providing an informed electorate, a knowledgeable working populace, and the dream of social and wealth advancement undeterred by lack of access to the skills needed for achievement. At different times in our history, the age-guaranteed education supported agriculture and basic working skills for boys, basic housekeeping skills for girls; then, the addition of at least two years of high school provided the skills for the industrial revolution and the expansion of America's industrial base. Now kindergarten-12th grade is the norm. Many states have built extensive community college systems for those who want to acquire better knowledge of some high school curricular subject so they can meet the entrance aptitude requirements for a college or university. Other community colleges offer certification in specialized trade skills for men and women who either do not want to go to college, who want to pursue a crafts skilled career, or who want to bring current skills acquired before there were significant technological changes in their chosen employment or who wish to become part of the workforce.
In high school, it seems that most of the teaching effort is predicated on an assumption that every student wants to go to college. Indeed, many public service jobs now require or give hiring preference to candidates with college degrees: police officers, clerical and secretarial positions, and most public employment openings. Ten or twenty years out of high school, I wonder how many students believe they are better off with a 4-year college degree that their classmates who became electricians, plumbers, other skilled trade members. Even those students who went directly into an unskilled job such as an assembly line worker, steel worker, longshoreman job can become as wealthy and achieve socially upward mobility for their children, especially if their initial job required joining a union.
This brings up a question for me: Who is better off? Who is achieving the mythical American Dream?
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Why are so many people pushing for less regulation when they do not have sufficient savings or other forms of wealth (land, inheritance, stocks, bonds, etc.) to have a worry-free retirement or to pay for their own health care? Why are there poor-White Republicans and second-generation Latinos embracing the ways and means that benefit only the wealthiest people in the country?
Why are some financial commentators lauding politicians who are proposing radical changes to the federal tax code such as a flat tax? Most people already pay flat taxes or sales taxes in their home states? Cities also levy flat taxes through additional sales taxes. Why don't the sales taxes fund government sufficiently? When I buy a box of bandaids for $4.00, the retailer collects an additional state sales tax of 34¢, so I pay $4,34 out of pocket. No one escapes the sales tax on most retail goods. If the customer did not pay the extra 34¢, the retailer would still have to pay 34¢ to the state. State tax code allows the seller to collect sales tax from the customer, but the state says that the tax is levied on the amount of the seller's price. Sales tax revenue is not the customer's responsibility.
When filing California state income tax forms, there is a place for the taxpayer to enter the sales tax amount avoided by purchasing goods on the internet for which the internet seller did not charge California sales tax. Essentially an honor system, if the internet retailer has no business presence in California other than the Internet, there is no basis for the state to impose a sales or use tax on the seller. If the seller does maintain a business presence, has a license to do business, then the internet seller must report the sale and pay the sales tax to the state. Amazon.com is currently contesting this policy. Should Amazon.com win, then the State has to revise the tax code to place the sales tax burden on the internet customer rather than on the vendor.
Another form of flat tax is the property tax. In California, county assessors use 1.3 percent of the property's market value (reset whenever property changes owners to the selling price), which can be adjusted within a 2 percent range without voter approval. In addition, cities and special voting districts ask voters for additional taxes to repay bond issues, to pay for additional public fire services, to pay for anything the local government sees itself unable to pay for out of their existing revenue streams. The result is a flat tax amount added to the property tax assessment. When I owned a condo in Oakland, California, one third of my property tax payments were flat tax add-ons resulting from voter approvals that had nothing to do with the assessed value of my property.
Watching CNN-TV this morning, I noted that the invited guests were very enthusiastic about a flat tax, referring to Steve Forbes' proposals during his unsuccessful run for the Republican nomination. Following that discussion was another pair of invited commentators opining on the OWS movement and sit-ins around the country. Each commentator took a very conservative financial viewpoint for describing this popular phenomenon. "What do they want?" "Are they more favorable to the Democrats?" "Who are they?" were questions raised but not answered. Not answered because to date no one voice from these groups of protestors has told the press why they were there--except that individuals all seem to have different reasons for being there. Poor media.
I wonder if this growing physical statement of dissatisfaction can be rendered into a single agenda. Some protestors seem to be calling for equal opportunity while others are advocating equal outcomes. A common theme is their perception of the current American way of life is unjust, that neither equal opportunity nor equal outcomes are possible. What could this mean?
In employment, salaries are stagnant except at the highest echelons of an organization. If middle and lower echelon job salaries were to rise at rates deemed "fair" vis à vis senior managers' and executives, the companies would move their operations overseas or to a non-union state so that costs would be lower. So how is a person supposed to find a job with a better wage? If in their current jobs they have vested retirement benefits, health care insurance cost-sharing, or tenure, the risk of changing jobs becomes complex and stressful, especially because of their partners' job status and location, their children's schooling, and the first-in-first-laid off status on the new job.
Even if one can go to school part-time online or at a local college while working full-time, the required physical and mental effort to become more marketable in the higher paying job markets is very high. I cannot put into words how much I admire the single parents who manage to work one job, be a parent and go to school at the same time.
I've heard there are 45 million unemployed persons today in the US, but there also are 3.1 million jobs employers are unable to fill from native American applicants. So, there are calls for changing the Immigration Law to attract and hire foreign nationals to fill these jobs. So, among the OWS are the unemployed who see the Immigration Law as unjust because it is not being enforced, as evidenced by the number of illegal immigrants working in the US. Of course, who is employing undocumented workers and for what wages and kinds of jobs is lost in the overall emotion of injustice toward those who have played by the rules and are being ignored. If the current Immigration Law were adhered to by US employers, I really wonder how many legal residents would leave their present location, where they cannot find a job, and relocate to work in jobs now filled by undocumented workers. People did move in the Great Depression, but we have not seen comparable migrations in the Great Recession. Why?
Others among the OWS believe that the Immigration Law is unjust when families are split up due to some members being documents and others not, when children of undocumented persons are allowed to attend public schools and receive private funding for attending post-high school educational institutions. The term "anchor babies" has currency in today's political discussions, especially in our southern states, that I find offensive and racist. The Constitution accepts de jure and de facto full citizenship to anyone born in the United States, but Immigration Law and state laws denigrate and punish such citizens should one or both parents be undocumented residents at the time the child is born.
[Side note: As more and more states begin to define the biological status of personhood as "at inception" or "at conception" (I fail to know the difference) will Immigration Law require all women of child-bearing age to take a pregnancy test before obtaining a visa to enter the United States, Puerto Rico, or the other U.S. territories? Once in the US, what if that woman becomes pregnant? Even if she leaves the US, would not her child be born a US citizen by reason of birth? Just asking....]
Free, public education has enabled America to aspire to being a nation of literate citizens, providing an informed electorate, a knowledgeable working populace, and the dream of social and wealth advancement undeterred by lack of access to the skills needed for achievement. At different times in our history, the age-guaranteed education supported agriculture and basic working skills for boys, basic housekeeping skills for girls; then, the addition of at least two years of high school provided the skills for the industrial revolution and the expansion of America's industrial base. Now kindergarten-12th grade is the norm. Many states have built extensive community college systems for those who want to acquire better knowledge of some high school curricular subject so they can meet the entrance aptitude requirements for a college or university. Other community colleges offer certification in specialized trade skills for men and women who either do not want to go to college, who want to pursue a crafts skilled career, or who want to bring current skills acquired before there were significant technological changes in their chosen employment or who wish to become part of the workforce.
In high school, it seems that most of the teaching effort is predicated on an assumption that every student wants to go to college. Indeed, many public service jobs now require or give hiring preference to candidates with college degrees: police officers, clerical and secretarial positions, and most public employment openings. Ten or twenty years out of high school, I wonder how many students believe they are better off with a 4-year college degree that their classmates who became electricians, plumbers, other skilled trade members. Even those students who went directly into an unskilled job such as an assembly line worker, steel worker, longshoreman job can become as wealthy and achieve socially upward mobility for their children, especially if their initial job required joining a union.
This brings up a question for me: Who is better off? Who is achieving the mythical American Dream?
- Is it the high school teacher earning $40,000 with guaranteed benefits, nine-month work years or the independent owner of a plumbing shop able to charge $75/hr for labor plus retail for parts bought at wholesale. who has his own home, an at-home spouse who is raising the children and seeing that they can achieve their own ambitions, or whose spouse is a manager of an office, earning a substantial wage with comparable benefits?
- Is it the college professor who, as an associate professor on a tenure track, earns $55,000 teaching History of Renaissance Europe, not finding much opportunity for additional income except from book royalties, guiding private tours in Europe, and loves his students and his teaching. How just does she see her profession as a highly ranked scholar and teacher when her counterpart in Bio-engineering or Computer Science earns $65,000 and has access to additional income and increasing academic status through research grants and contracts with public and private funds, from consulting fees with private enterprises and from patent royalties?
- Is it the entrepreneur high school-educated person who invents a new technology, who creates a unique software system and licenses it exclusively?
- Is it the financial wizard who accrues tremendous personal wealth by working 12-16 hours per day, but lacks a personal life, a partner with whom to share the fortune or whose wealth could disappear in a market crash?
- Is it the person whose values, personal ethics are not necessarily matched to the social position, personal earning power or inherited wealth, and values free time to help others achieve their immediate or long term needs?
- Can it be a person who joins a religious order and forgoes all personal assets to pursue a spiritual path?
- Is it the person who just doesn't care what other people think or who lacks ambition or who doesn't think about such things as social status, wealth or education? Lots of people just want to live their lives unbothered, hassle-free and enough money to feed, clothe and watch television without someone telling them what they should do or what they should want.
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