Crony Capitalism

Stossel's story above is a perfect example of crony capitalism. I have been completely serious about my position that what we have here in America is not free market capitalism, but crony capitalism which is not even remotely comparable to true free market capitalism.

Ever since the passage of the 16th Amendment of the Constitution of the United States of America in 1913 - the amendment that implemented the progressive income tax system - this nation was doomed to the rise of crony capitalism. The 16th Amendment gave politicians the power to tax in such a myriad of ways as to enable them to pick the winners and losers in the private sector at will and thus encouraging those in the private sector with the means to seek out those in the political class susceptible to monetary inducements to maintain their position and power to do so. Now politicians had not just regulatory power to make private-sector business life miserable, they had the most powerful weapon in their arsenal to bring grief to private-sector businesses... taxes.

Our tax code is so unbelievably huge, so overwhelmingly complex, so easily manipulated out of sight of the population by the political class, that it should be deemed an affront to liberty and a criminal enterprise punishable by law. Add to this, the exponential growth of federal agencies and federal regulations in the 20th century which gives the federal government ever more power to pick winners and losers in the private sector, and you have the perfect mix of regulatory and tax powers to completely manipulate the private sector to the advantage of politicians and to the detriment of the citizenry.

Of course, those on the left are only to happy to cite the failures of crony capitalism as a failure of capitalism itself... which it is not!

This is the lie that is being perpetrated by RINO's, Democrats, liberals and progressives in America. And it is a lie that must be addressed with the truth. We have not had real free market capitalism in this country since the passage of the 16th Amendment, and we will not have it again until this amendment is repealed and a sane system of taxation takes it place. A system of taxation that does not allow politicians to manipulate it to government's advantage and the population's harm.

And something must also be done about the extra-constitutional regulatory powers that the federal government has assumed for the sake of consolidating power into the hands of the federal government to truly restore sanity to our economic system.

But we must remember one lesson of supreme importance, if we are to make any progress at all. And that lesson is that human nature will always seek any available outlet to manifest itself. Human nature is to avoid pain at any cost, and to seek pleasure always even if that is at the cost of another. The path to pleasure that is of the least resistance is always that path that mankind seeks. It is an undeniable fact of history, and it is why mankind has erected institutions of religion and law. These both seek to serve as a check on human nature and attempt to bend that nature to serve the greater good when those in power truly wish for the best of the people they serve. And yet these same institutions have also served as tools of oppression in the hands of less scrupulous leaders.

Real free market capitalism, under a government supporting individual freedom and the rule of law and enforcing that law without prejudice or favor, has proven itself to be the greatest force for progress that history has ever known. It has truly been the tide that lifts all ships.

Crony capitalism, a quite predicable outcome of political bodies (as a political body will eventually become an organic entity that seeks a means to survive independent of it's constituents), must be exposed for what it is if our nation is to survive.

Honestly, a knowledge of history is our only hope of escaping the scrapheap of history.

To be quite honest, I would love for anyone here to challenge me on my "crony capitalism" vs "free market capitalism" commentary.

dblboggie wrote:Real free market capitalism, under a government supporting individual freedom and the rule of law and enforcing that law without prejudice or favor, has proven itself to be the greatest force for progress that history has ever known. It has truly been the tide that lifts all ships.

And this was proven prior to 1913? How so? In what respects was pre-1913 America dramatically better than post-1913 America? What metrics do you look at?

What specifically do you mean by "progress" and "lifting all ships?"

From a European perspective, a government hands off approach to business led to the worst abuses of workers in the 19th century. Social liberalism (the concept of personal responsibility going hand in hand with rights) and Socialism rose up across the continent in a short space of time.

dblboggie wrote:Our tax code is so unbelievably huge, so overwhelmingly complex,

That's the thing that our European friends aren't aware of... the complexity of it. Also, the manipulative ways people and business can "work" the tax system for their own gain.

dblboggie wrote:We have not had real free market capitalism in this country since the passage of the 16th Amendment, and we will not have it again until this amendment is repealed and a sane system of taxation takes it place. A system of taxation that does not allow politicians to manipulate it to government's advantage and the population's harm.

I believe this is where the Fair Tax comes into play. Neither of the two party's will address this tax system except a very small number of Repubs.

Honestly guys, how much do you know about tax systems around the world to be making such statements?
Germany has one of the most complex tax systems in the world, but we're known for our middle-class companies that keep the German economy together.

BubbleBliss wrote:
Honestly guys, how much do you know about tax systems around the world to be making such statements?
Germany has one of the most complex tax systems in the world, but we're known for our middle-class companies that keep the German economy together.

Complex isn't always the bad thing. It's over regulation and other shit. Kinda like my uncle. He farms, makes around $400,000 a year. He pays absolutely no taxes at all. He actually gets money back every year after the tax filing season (about $10,000).

Yet people still say that the rich pay too much taxes....

BubbleBliss wrote: Yet people still say that the rich pay too much taxes....

They do. Need more IRS proof?

You just demonstrated an example of the exact opposite with your uncle's farm.

BubbleBliss wrote:
You just demonstrated an example of the exact opposite with your uncle's farm.

He's not wealthy.

BubbleBliss wrote:
You just demonstrated an example of the exact opposite with your uncle's farm.

I've also repeated in here (ad nauseum) that his income is business income. When you look at the way he lives (like me and you), he sure doesn't come off as wealthy. Also, he takes all the deductions that he possibly can. Like he has said to me in the pat, once you reach Zero, you can't go any lower.

BubbleBliss wrote: Yet people still say that the rich pay too much taxes....

The top 1 percent of income earners, those making over $410,000 a year, paid 40 percent of all federal income taxes. The top 5 percent, those making about $160,000 a year or more, paid 60 percent of all federal income taxes.


Tax Year 2008

Percentiles Ranked by AGI	AGI Threshold on Percentiles	Percentage of Federal Personal Income Tax Paid
Top 1%	$380,354	38.02
Top 5%	$159,619	58.72
Top 10%	$113,799	69.94
Top 25%	$67,280	86.34
Top 50%	$33,048	97.30
Bottom 50%	<$33,048	2.7
Note: AGI is Adjusted Gross Income Source: Internal Revenue Service

Tax Year 2007

Tax Year 2006

For Tax Year 2005

For Tax Year 2004

For Tax Year 2000

Percentiles Ranked by AGI	AGI Threshold on Percentiles	Percentage of Federal Personal Income Tax Paid
Top 1%	$293,415	36.18
Top 5%	$120,846	55.45
Top 10%	$87,682	66.45
Top 25%	$52,965	83.54
Top 50%	$26,415	96.00
Bottom 50%	<$26,415	4.00
Note: AGI is Adjusted Gross Income Source: Internal Revenue Service

TexasBlue wrote:

BubbleBliss wrote:
You just demonstrated an example of the exact opposite with your uncle's farm.

I've also repeated in here (ad nauseum) that his income is business income. When you look at the way he lives (like me and you), he sure doesn't come off as wealthy. Also, he takes all the deductions that he possibly can. Like he has said to me in the pat, once you reach Zero, you can't go any lower.

Whether he comes off as wealthy or not, he doesn't pay any taxes on his earnings. Even you cite it as a problem with your tax system, now you try to back trace and make it sound like he deserves to pay no taxes.
As far as the other stuff you posted, it doesn't contribute to this debate whatsoever as I was only talking about your uncle.

And as I've said before, the rich will always pay more taxes than the poor, that's only logical. Even a flat tax won't change that!

BubbleBliss wrote:Whether he comes off as wealthy or not, he doesn't pay any taxes on his earnings. Even you cite it as a problem with your tax system, now you try to back trace and make it sound like he deserves to pay no taxes.

No, I never said he deserves to pay no taxes and never have alluded as such. Me and him argue this all the time. I say he should pay and he likes that he doesn't (naturally).

I was pointing how the system can (and is) gamed by millions. It's legal, too. But at the same time, people bitch because the wealthy don't pay enough. The very wealthy do. Others, like my uncle, have good CPA's that find the loopholes to save them money.

My uncle is a lifelong Democrat, btw.

BubbleBliss wrote:As far as the other stuff you posted, it doesn't contribute to this debate whatsoever as I was only talking about your uncle.

Earlier in this thread, you said;

BubbleBliss wrote: Yet people still say that the rich pay too much taxes....

So I provided the stats (again).
They pay most of the taxes.

BubbleBliss wrote:
And as I've said before, the rich will always pay more taxes than the poor, that's only logical. Even a flat tax won't change that!

Of course the rich do, by virtue of what they earn. The point that we cons make is that the rich pay most of the taxes and over 47% of Americans pay none. Many of that 47% are people who make over $50,000 a year. Then there's those who make less than $15,000 a year who pay (rightfully) none. Then you have people like me who are single and have no deductions and have to pay in while people who make the same amount but have a wife, kids and a house (deductibles) and they pay nothing.

kronos wrote:

dblboggie wrote:Real free market capitalism, under a government supporting individual freedom and the rule of law and enforcing that law without prejudice or favor, has proven itself to be the greatest force for progress that history has ever known. It has truly been the tide that lifts all ships.

And this was proven prior to 1913? How so? In what respects was pre-1913 America dramatically better than post-1913 America? What metrics do you look at?

What specifically do you mean by "progress" and "lifting all ships?"

Yes, particularly following the industrial revolution, America in the 19th century was experiencing phenomenal growth rates in both real GDP and real GDP per capita (and they weren't doing all that shabby before that) and in 1890 surpassed the UK in manufacturing output (the birthplace of the industrial revolution). However, the advancement of progressive movement policies by Woodrow Wilson spelled the beginning of the end for real free-market capitalism and put into place the tools to give government the upper hand in promoting crony capitalism for the expansion of government power and the exponential growth of government.

By progress I mean improvement in the standard of living for more and more people, by lifting all ships I mean that in a free-market capitalist system under the rule of law, success is not limited to owners of the means of production, but is distributed to many through wages and salaries. It is no accident that the single largest source of federal income, some 79%, comes from personal income and payroll taxes and or that those wages and salaries represent 71% of our nation's total income. It's hard to argue with economic stats, but it is certainly easy to demagogue the economic system that produces them with anecdotal observations that have nothing to do with reality.

TexasBlue wrote:

BubbleBliss wrote:Whether he comes off as wealthy or not, he doesn't pay any taxes on his earnings. Even you cite it as a problem with your tax system, now you try to back trace and make it sound like he deserves to pay no taxes.

No, I never said he deserves to pay no taxes and never have alluded as such. Me and him argue this all the time. I say he should pay and he likes that he doesn't (naturally).

I was pointing how the system can (and is) gamed by millions. It's legal, too. But at the same time, people bitch because the wealthy don't pay enough. The very wealthy do. Others, like my uncle, have good CPA's that find the loopholes to save them money.

My uncle is a lifelong Democrat, btw.

BubbleBliss wrote:As far as the other stuff you posted, it doesn't contribute to this debate whatsoever as I was only talking about your uncle.

Earlier in this thread, you said;

BubbleBliss wrote: Yet people still say that the rich pay too much taxes....

So I provided the stats (again).
They pay most of the taxes.

The term "the rich" doesn't just include the very wealthy, it also include those making more than $100,000 a year. That's the problem, whenever Cons hear "the rich" they automatically think about the super rich, even though they're not the only ones classified as rich.

BubbleBliss wrote:The term "the rich" doesn't just include the very wealthy, it also include those making more than $100,000 a year. That's the problem, whenever Cons hear "the rich" they automatically think about the super rich, even though they're not the only ones classified as rich.

I'm not one of those. The stats for "rich" are govt invented. They decide who's "rich" and who's not. These days, they go by $250,000 on up. I consider anyone who makes $100,000 a year well to do.

Well, the gov't also officialy decides who deserves to pay what percentage of taxes....