Scattershots – 15jan18 (updated 18jan18)

George Rebane

Here are a couple of items that are guaranteed to call out the Collectivist Cricket Corps.

High tax states like California and New York are now suddenly devising legislative back flips trying to keep their rich from moving out.  They have come up with a ruse to favor those daily vilified filthy rich (wink, wink) in the form of tax deductible charitable contributions.  And who will be the charity on the receiving end? (Seat belts please) Why their states’ general fund, that’s who.  It works like this.  Suppose your state’s max marginal income tax rate is 13.3%; just a random number I picked out.  And your income is such that you wind up paying $50K tax to the state.  Before tax reform, you would deduct that from your gross adjusted income and pay the federal rate on the remaining.  Since after tax reform you can no longer do that, the Democrat sleazebags in the state houses have a scheme by which you contribute that $50K to a newly cobbled state charity, then deduct it from your adjusted gross income as permitted by the new 2018 tax law, and wind up paying the federal tax on the remaining, just like before.  The state wins, and you win.

All the while this is going on, the socialists, who claim that tax rates make no never mind on economic decisions, continue to convince their constituents that all is well, as they stuff cash back into the pockets of those dastardly rich who pay the lion’s share of their state’s taxes, thereby making possible all the vote-buying programs that keep them in office.  Sweet, but I don’t think the courts are going to buy it since a fundamental tenet of charitable giving is that it’s not supposed to benefit the giver.

And speaking of tax reform, you know, the one that is supposed to take money from the poor, or at least not provide them any benefit while the rich are laughing all the way to their mattresses with all that extra cash to stash.  Here’s just a short list of what’s really going down where real Americans live and work from Forbes, The Hill, Daily Signal, and Washington Examiner, but not from Nancy and Chuckie, that irresistible pair of Lying Lefties.

[update]  Mr George Boardman wrote a thoughtful column in today’s 15jan18 Union (here) describing the (leftwing?) citizens’ initiative to double the recent temporary increase in Grass Valley’s sales tax and make it permanent.  The money would be used for the usual litany of things, from fixing sidewalks to hiring more police and firefighters.  What always remains unasked is why do we need ever higher taxes to do the same things that were accomplished in past years with existing taxes, especially since the community’s population has decreased.  The answers, of course, are obvious and don’t fit the progressives’ narrative, so that discussion continues to be suppressed.

Also, I was again sad to see Mr Boardman’s politically correct use of the ‘transient’ appellation.  Apparently, the population of such transients is not only growing, but their criminal consumption of city facilities and destruction of surrounding woodlands is now pretty much out of hand.  Wasn’t it not that long ago that people who had no visible means of support, lived, trashed and slept in public areas, panhandled, and otherwise made citizens apprehensive and brought a lasting pall on a community, weren’t they called bums?  With all of Nevada County’s welcoming and nurturing programs in place, why should anyone like that consider himself a transient?  Transients are people who come, work, recreate, shop, and temporarily enjoy themselves here and then leave.  Why continue to confuse the issue?

That California is particularly afflicted with such problems through its massive misspent and mismanaged welfare programs that are highlighted in Russ Steele's 958am comment below.  The Left’s solution to the problem has always been an unabashed practice of Einsteinian insanity.  There is no evidence that this practice will abate.

[16jan18 update]  Back in 2007 Mike McDaniel and I wrote an SESF report (link here)on the already disastrous state of unfunded liabilities in government workers’ pensions accrued to almost every jurisdiction in California, including Nevada County.  We presented our results to our Supes, who sniffed that we didn’t really understand the sophisticated finances of pension funding and that there was nothing to worry about (more here).  Now eleven years later, even progressives are beginning to realize that the horribly negotiated pension contracts for government employees will most likely be paid off in some fraction on the anticipated dollar.  Today finally, the epiphanies are coming on daily.  It’s hard to tell whether our own left-leaning graphical commentator Bob Crabb is evincing one of his own, or just reporting what is happening across the state in his cartoon filched from 16jan18 Union.

[18jan18 update]  By now everyone should have heard about Apple ‘repatriating’ some of their off-shore billions thanks to President Trump.  And what will they do with that money after they pay the 15% federal repatriation tax (about $38B), why they’ll increase executive salaries and bonuses, pay huge dividends to shareholders, and stuff the rest into mattresses – not.  Actually, as a result they’ll contribute about $350B to the US economy through expansions of new facilities, development of new products, and creating over 20,000 new jobs.  And guess in what state they will not expand their operations – c’mon folks, you can do it.

Meanwhile our leftwing politicians, lamestream media, and local lying liberals (here) continue practicing ‘truth decay’ (here) telling Americans that the new tax reform law (for which no Democrat voted) only benefits corporations, the rich, and raises taxes for the middle class and poor. (more here)

The bottom line of all this repatriation by corporations amounts to about $2.5T (yep, that's trillion) into the US economy from which the feds will collect about $340B in taxes over the next ten years.  And the impact of all this money into America's pockets will cause the socialists to soil their shorts.  A good interactive graphic explanation of all this is available to WSJ subscribers here; none of this will be covered by the lamestream as will be evident in these pages by the comments from our more blindered readers.

http://www.wsj.com/graphics/tax-repatriation/ 

Comments

[Scenes]

One article:

http://www.capoliticalreview.com/top-stories/to-avoid-trump-tax-reform-california-dems-want-to-convert-state-taxes-to-charitable-contributions/

That is so smart. I wonder how tax cases wind their way through the courts, is it done via a court system within the IRS?

I'm still wondering why we can't simply crank up the marginal rates on CA income tax to 50% or so, and then give everyone in the state free health care. Any job that matters in state government is purest Green Libertarian as is the legislature.

It's almost like Green Libertarian philosophy is fake somehow. Say it ain't so, Joe.

[fish]

Posted by: Scenes | 15 January 2018 at 06:42 AM

Yeah ......all the consternation puzzles me......after all “taxes are the price we pay for civilization” or so i have been assured!

Are progressives reversing themselves on the issue?

[Scenes]

re: 7:05AM

"Are progressives reversing themselves on the issue?"

As a practical matter, I don't think that the Green Libertarian elite really is interested in the policies they propose. For one thing, something like healthcare is so complex that you are likely to fail no matter what your intentions where.

It looks to me like the main value of the growth of government is to provide a spoils system. The Soviet Union was a pure play here, but you can see it in most countries worldwide. The government (usually the central .gov) accumulates as much as it can, and then it is passed back to favored groups and individuals. Your son-in-law gets that good job at the state-run TV station or school, particular groups get better security or infusions of money.

In the final analysis, maybe that's all this is about. One philosophy that uses a hidden hand to apportion resources via a marketplace, the other hands it out to it's friends. Sadly, you can end up with a high Gini coefficient in both cases.

[George Rebane]

Scenes 731am - And the distribution wealth/income/etc viz the Gini coefficient should be an indicator to progressives, should they reason, that socialism is no guarantee of more equal (and most certainly not equitable) distributions as has been pointed out here for years. Yet the UN continues to dun only countries more open to markets for their politically incorrect Ginis.

[Russ]

What's the Matter with California?

BY MICHAEL WALSH JANUARY 14, 2018

Guess which state has the highest poverty rate in the country? Not Mississippi, New Mexico, or West Virginia, but California, where nearly one out of five residents is poor. That’s according to the Census Bureau’s Supplemental Poverty Measure, which factors in the cost of housing, food, utilities and clothing, and which includes noncash government assistance as a form of income.
Given robust job growth and the prosperity generated by several industries, it’s worth asking why California has fallen behind, especially when the state’s per-capita GDP increased approximately twice as much as the U.S. average over the five years ending in 2016 (12.5%, compared with 6.27%).

The Left's first, last and only instinct is to throw more money at the problem, but California's already done that. and guess what?

It’s not as though California policymakers have neglected to wage war on poverty. Sacramento and local governments have spent massive amounts in the cause. Several state and municipal benefit programs overlap with one another; in some cases, individuals with incomes 200% above the poverty line receive benefits. California state and local governments spent nearly $958 billion from 1992 through 2015 on public welfare programs, including cash-assistance payments, vendor payments and “other public welfare,” according to the Census Bureau. California, with 12% of the American population, is home today to about one in three of the nation’s welfare recipients.

The generous spending, then, has not only failed to decrease poverty; it actually seems to have made it worse.

More here:

https://pjmedia.com/trending/whats-matter-california/

[ArchieBunker]

A donation to a state charity (like any other charity) would not directly benefit the giver. The idea of a flat tax is to eliminate deductions. A flat tax would be a good thing. But if Congress (Republicans) is going to eliminate the state income tax deduction then they should have eliminated the AMT which was devised to make sure the rich paid plenty of taxes even after their deductions. On my 2016 tax return it looks like the amount of 37% tax I would have paid on my deducted state tax portion was close to the amount I paid in AMT. The difference between 39.6% and 37% tax rates does not make up for the amount of AMT and loss of state tax deduction. Corporations win, people pay more.

[ArchieBunker]

A person would not have to donate to the state charity to get the same deduction so this idea could lead to more charitable giving. Donate to charities within the state and keep the money local instead of sending it to the federal government.

[George Rebane]

ArchieB 1035am - Au contraire Mr Bunker, the benefit of such a charity scam would be direct and countable in the wallets of its practitioners. Apparently my above example is not clear enough for you to understand. Perhaps you could gain comfort in recalling that the mavens in all high-tax states are considering such stratagems. To deny direct benefit to the 'giver' would discredit all these conspiring collectivists. If you are still unconvinced, then maybe letters to these intending governors would be a next step.

What you seem to miss in your 1100am is that the state wants your 'charitable contribution' to go into its general fund. That's the whole point of the scam.

And your AMT concerns under the new tax law are addressed here -
http://www.nationalreview.com/corner/454797/amt-change-gop-tax-bill-will-help-blue-state-taxpayers
https://www.forbes.com/sites/brianthompson1/2017/12/17/tax-reform-and-amt-what-you-should-know/#9d3dd1c20816

[Walt]

Did Jerry and the kids brew this up after taking a close look at the Clinton Foundation?

[ArchieBunker]

GeorgeR 1103am - Here is something you might have missed,

"The IRS has long required taxpayers to subtract the value of anything they receive in return for a charitable contribution before taking a deduction, so someone who gets a $5 tote bag for a $50 donation to a public TV station, for example, can only deduct $45.

But the IRS has also said that the value of the deduction itself in terms of federal tax avoided does not have to be subtracted, said Kirk J. Stark, a tax law professor at the University of California-Los Angeles School of Law.

Stark said the IRS could change its ruling to address what California and New Jersey are looking to do, but that could also impact the voucher programs and more widespread programs that provide real estate developers incentives to preserve land on which they could otherwise build.

"Tax credits for donations of conservation easements have become a popular thing to do," Stark said. "Before he became president, Donald Trump made several donations of conservation easements over the years.""

https://www.usatoday.com/story/news/politics/2018/01/05/states-consider-workaround-trump-tax-law-cap-deductions-spurs-high-tax-states-consider-charity-worka/1003733001/

[ArchieBunker]

The point of my 11am was to point out that you can get the same tax deduction if you give it to any charity. You don't have to give it to the state charity.

[ArchieBunker]

Regarding the AMT, for high income (over $1 million) filers the AMT would be reduced. It will be interesting to see if the amount saved in the new AMT calculations will substantially offset the loss of the state tax deduction making the state charity scam a mute point.

[George Rebane]

ArchieB 1119am et seq - yes of course, but where we're talking past each other is that you're still addressing the obvious, well-known, and legitimate charitable giving question where that is the furthest from the minds of the states seeking to continue their stream of revenues.

Just for reference, the additional ("subsidy") amount of federal taxes paid on adjusted gross income of A is rS*rF*A, where rS and rF are the effective state and federal tax rates respectively. If there is reader interest, I'll present the derivation of this and other related factors in a future post.

[ArchieBunker]

I still must be missing something. Why would de Leon bother to offer up a "state charity" as a solution since it is obvious that a donation to any charity will do? Can you imagine how it would look if you searched for California State Charity in Guidestar or Charity Navigator and looked at the program expense ratio? "Management" expenses would account for 95 cents of every dollar you donated.

[Scenes]

re: GeorgeR@8:36AM

"And the distribution wealth/income/etc viz the Gini coefficient should be an indicator to progressives, should they reason, that socialism is no guarantee of more equal (and most certainly not equitable) distributions as has been pointed out here for years. "

I think sometimes that it's an honest mistake by Western socialists and quasi-socialists. They really have no idea how unequal income and wealth were in places like the Soviet Union. There's a general notion that the Russians and friends were all equally poor (perhaps because it wasn't "real communism") but there's a kind of blank space in peoples' heads about the reality on the ground. In cases where the whole works is run by a single giant corporation (with subsidiaries of course), it's practically impossible to not end up with an elite.

[Scenes]

AB@whenever

"A person would not have to donate to the state charity to get the same deduction so this idea could lead to more charitable giving. Donate to charities within the state and keep the money local instead of sending it to the federal government."

That's not how I'm reading it. The difference between a charity and a "state charity" is that the second would have a 1:1 offset in terms of state taxes...that is to say you wouldn't pay your state income tax at all, you'd pay into this 'charity'...it's just that charities are tax deductible at a federal level (as state tax payments are currently).

It's a super clever idea, but I doubt that it sticks. The feds (probably an IRS regulation, not a law) will just more finely refine a charity definition if need be.

[Scenes]

more AB@whenever

"I still must be missing something. Why would de Leon bother to offer up a "state charity" as a solution since it is obvious that a donation to any charity will do? "

read my post at 1:22PM.

Frankly, I don't know what the fuss is. Rich people in rich states pay more taxes, poor people in poor states aren't affected.

I thought that tax systems that go after the rich are good things?

[George Rebane]

ArchieB 1238pm - Yes Mr Bunker, any charity would do for the giver. But that charitable gift would not go into the state's coffers. For it to be a win-win scheme, the new (hoaky) charity's gifts would have to accrue to the state's treasury. Both parties should see no change in their fortunes, and that is the type of charitable giving the high-tax states are trying to set up.

[ArchieBunker]

What the state needs to do is simply designate itself as a charity. Your taxes are then a charitable deduction. Easy.

[Walt]

Sure thing Archie,, " charity" with no choice in the matter.
Care for the Red Cross to say how much your going to "give" and by when?

[ArchieBunker]

It already is basically a charity. So why not get a charitable deduction?

[Walt]

Choose not to give, and see what happens. Since your into the spirit of giving,, you can cover mine.

[ArchieBunker]

I think you are barking up the wrong tree. The Fed is not letting people deduct their state income tax payment any longer. So the state is trying to come up with a way to make your tax payment a charitable deduction. I did not understand it at first but I say why not? I am no fan of the Fed and don't want my taxes to go up. Do you?

[ArchieBunker]

http://www.sacbee.com/opinion/op-ed/soapbox/article194058844.html

[Account Deleted]

ArchieBunker is missing something here. You can donate to any charity you want and that will reduce your Fed taxes if you itemize. It will not eliminate your CA state income taxes. You end up having to pay CA state income taxes no matter what. Either the way you normally do or by 'donating' the same exact amount to this new scam called a 'charity'. It's not voluntary, and it's not a charity by normal IRS rules. However, don't count out the IRS changing their rules. They are a law unto themselves and if you don't like it, they'll tell you to go pound sand.

[Account Deleted]

Archie - "The Fed is not letting people deduct their state income tax payment any longer"
Not true - you will still be able to deduct up to 10,000 smackers.

[Account Deleted]

"I am no fan of the Fed and don't want my taxes to go up. Do you?"
Do you know for a fact that your over-all state, local and fed tax amount will be going up due to the new fed tax law? Not saying it will or won't but I've talked to people who are afraid it will and then I find out they don't even itemize their taxes.
The news media and the Dems are having a field day screeching that the poor and middle class will have to pay more.

[ArchieBunker]

Yes, as I said in my 522pm I did not understand at first what de Leon was proposing. Now I think why not?

[ArchieBunker]

If you don't want to try the charity route you can just pay your taxes in the "usual" way. I think the "usual" way should be the "charity donation" way. For me it is just a way to mess with the Fed.

[Walt]

And the FED with "mess with you" right back.
Do what you like. It's you paying the lawyer.

[Account Deleted]

"For me it is just a way to mess with the Fed."
And if the IRS continues their rules per usual, it isn't going to work. It certainly is not a charity, it's a scam.
I don't like high taxes either - that's why I moved to Idaho. You stay in CA and you will end up paying increasingly higher taxes, fees, cost of living, etc.

[Don Bessee]

SO screw all the soccer moms and football families, socialist bastards-

https://pjmedia.com/trending/soda-tax-sticker-shock-grips-seattle/

;-)

[Scenes]

Here's a copy of the tax bill.

https://apps.washingtonpost.com/g/documents/business/read-the-full-gop-tax-bill/2678/

I was just spending a few minutes looking at all the online pontificating (on various news sites) about it and I just had to laugh at how little people know about the stuff they preach on. Mind you, this isn't a mushy problem in sociology but is a set of numbers and fairly simple rules.

[jon smith]

Donations to California's Department of Fish and Wildlife have been tax deductible as charitable contributions for as long as I can remember.

[Walt]

Yes jon,, but those ain't TAXES. You CHOSE to "donate".

[Bill Tozer]

CA Department Of Fish and Game, as well as the DMV, are funded by revenues generated solely by fees charged for licenses, etc, not from the general fund. It is unlikely that the states’ plan for her residents to voluntarily “donate” to a non-profit charity or issue advocacy group by writing a check that is directly deposited into the states’ General Fund will more than likely NOT fly within the IRS’s guidelines and rulebook. Lawyer stuff. Maybe there are loopholes. Heard enough bitching through the years about the darn filthy rich hiring lawyers to find loopholes us little people can’t afford to find, not to mention argue successfully in court.
CA receives billions in revenue and has hundreds upon hundreds of lawyers on payroll. The evil rich are at it again! :)

Meanwhile, might as well ask the opinion of any local jailhouse lawyer...er...inmate. They don’t call them ‘cons’ because they are convicts. Nay, they are called cons because they are conmen. This state workaround sounds like a con to me. Time will tell.

[Bill Tozer]

Why is the taxes in CA so damn high? Complete with graphs at the bottom.

https://www.mercurynews.com/2018/01/13/why-do-californians-pay-more-state-and-local-taxes-than-texans/

[George Rebane]

BillT 259pm - That's because most of CA voters are pinhead progressives. Now what's your next question Mr Tozer, and please make it a bit more challenging.

[Bill Tozer]

Another softball. Gotta wait for a tough question.

Why don’t Californians get more bang for their buck?

[Bob Hobert]

It’s a Brave New World!

California Regulators Just Decided To Kill The Last Nuclear Power Plant In The State
By Tim Pearce
January 13, 2018 at 10:43am

California regulators voted unanimously Thursday to shutter the state’s last nuclear power plant by 2025.

The Diablo Canyon nuclear facility is scheduled for an incremental shutdown, phasing out Unit One in 2024 and Unit Two in 2025.

https://www.westernjournal.com/california-regulators-just-decided-kill-last-nuclear-power-plant-state/?utm_source=facebook&utm_medium=thenewvoice&utm_campaign=can&utm_content=2018-01-15

[Bob Hobert]

Ok, I tossed the previous comment because it's called Scattershots. Here's another - take this bike ride through a California shantytown. Q - will there be more or fewer of these in California's future?

Bicyclist Films 10 Straight Minutes of Shantytowns in Santa Ana
If there’s any one state in this august union that could be properly termed socialist, California would certainly be in the running.

After all, the Golden State is where taxes are high, the so-called “safety net” is wide, economic growth is low and anyone who disagrees with leftist orthodoxy is chased off of state-run college campuses.

Well, if you want to call California socialist, all we can say is this: We’ve seen the future, and it doesn’t work.

If you don’t believe me, take a look at this video showing the homelessness in Orange County, California. It’s a 10-minute bike ride through one of the largest shantytowns in America:

https://conservativetribune.com/democrat-leadership-shantytowns/?utm_source=facebook&utm_medium=thenewvoice&utm_campaign=can&utm_content=2018-01-16

[Account Deleted]

Had an interesting conversation with a fireman from L.A. He and his wife are going to buy a home near Boise and he will commute to work twice a month. He says the savings in his electric bill alone will pay the difference. (he's not kidding) He'll bail out of their home in SoCal and pay cash for a bigger home here in Idaho. Money, he claims, is not the big reason. Being a fireman, he sees much more of what's wrong in society than most people and what he sees in SoCal makes them want to raise their kids some where else. Not to mention he likes the freedom here. He's not alone by far. He personally knows 2 others that commute in the same way. One to an area south of Reno and the other lives just a couple of miles from where I live. I read a article 20 years ago about LA firemen commuting to St George, Utah in their own aircraft. Keep it up, California, keep it up.
When is that free health care for anyone in the world coming to the golden state?

[Scenes]

BillT: "Why don’t Californians get more bang for their buck?"

The problem isn't so much bang as it is bucks. California government needs more money for good deeds.

See here, if you just went for my new tax plan, what I'll call the Cal-50 Plan, everything will be fine. The idea is that the state income tax rate gets bumped to a flat 50% for everyone*.

We can buy homes for all the homeless, give out free healthcare, and probably build another bullet train. No Trump needed, simply get the state legislature working on this bill.

Everything would probably be fine then. The state can ignore Orange Hitler's tax plan, and the utopia produced would allow us to invite in millions of New Americans (what used to be called illegal aliens). The additional population will put us over the top.

*State employees excluded.

[Walt]

OK Bill and Scenes you gents are top sarcasmists hands down. Don't ever let up. Someone needs to publish some of your uh,, thoughts.
I take my hat off to you both.

[Account Deleted]

"...a flat 50% for everyone." Is that after deducting the money sent south of the border? Will they collect the tax in the parking lot of Home Depot?

[Russ]

Scott@05:30 PM When I was in Idaho this summer I heard about a fireman commuting to Reno from Idaho. It was hard to believe at the time, but it is becoming more of a regular routine.

[Scenes]

re: ScottO:

" '...a flat 50% for everyone.' Is that after deducting the money sent south of the border? Will they collect the tax in the parking lot of Home Depot?"

One of the statutes in Cal-50 will be that New Americans are immune from the 50% tax. However, they will receive a CASSN (California social security number) in order to receive money from the state-run New American Pension Program (NAPP).

Also, in order to do the jobs that Californians won't do, it may make sense to give free auto insurance to all New Americans.

With crazy articles like this being written:

http://www.nationalreview.com/article/455453/president-trump-undoes-obama-legacy-commonsense-nobama

we can't allow Drumpf to stand in the way of our goal of bringing in the talents of all people worldwide.

[Account Deleted]

Well - I certainly identify as a New American! I'm new every day! Born again, you might say. Where are my my rights and my moolah?
In the wake of MLK's birthday celebration you can't possibly deny me my rights!
To your moolah. I might add.

[Account Deleted]

Well - you have to give some credit to NR for hosting that screed. Trump was the protestant rube that lowered the critical bar for the NR crowd. They detested him even as he elevated their beliefs in a way they had no balls to do so for themselves.
I often wonder what Brother Bill would have said about Trump had he been here to see (and hear) for himself.

[Account Deleted]

Firing Line 1981: https://www.youtube.com/watch?v=6QaxprQEzpM
A lot of numbers so lefties might not want to watch.

[Don Bessee]

Winning!

http://insider.foxnews.com/2018/01/17/trump-tax-cut-and-jobs-act-reason-employees-getting-bonus-checks-company-says

DOW 26,100 right now! ;-)

[Scenes]

Hang on, according to the Washington Post, one of those highly pro-Trump news organs, a complete Mexican wall would cost an impossible $21B.

Apple is handing over $38B?

Problem solved.

[Bill Tozer]

How California Democrats have turned the Golden State into a Sh*thole, Part 1

http://www.flashreport.org/blog/2018/01/15/how-california-democrats-have-turned-the-golden-state-into-a-shthole/

Part 2
http://canadafreepress.com/article/how-california-democrats-have-turned-the-golden-state-into-a-thole-part-ll