Tag Archive: Exile on Main Street


“Billionaires should not exist.” — Millionaire U.S. Senator Bernie Sanders (D-Vermont)

“Every billionaire is a policy failure.” — Rep. Alexandria Ocasio-Cortez (D-New York)

“Personal wealth is at best an unreliable signal of bad behavior or failing policies. Often the reverse is true.” — The Economist

Super talented and accomplished media superstar Oprah Winfrey is worth $3 billion.

Basketball Hall of Famer Michael Jordan’s net worth is $1.9 billion.

Hip-hop star/investor Jay-Z just made into the three-comma club at $1,000,000,000.

Did government fail when Oprah, Michael and Jay-Z all succeeded and thrived, each because of their hard work, fortitude, perseverance and incredible talent?

Did anyone of them trade on their … privilege?

Almost DailyBrett doesn’t remember Oprah engaging in insider-trading.

Do you, Secretary Reich?

Ditto for Michael Jordan profiting from a monopoly unless Mr. Reich is pointing to Michael’s near-monopoly of talent against the competition he faced night-after-night in the NBA?

Is Jay-Z guilty of fraud, a political payoff or did he inherit his wealth?

Wonder if any of these “basically 5 ways” to accumulate a billion dollars in America apply to Nike founder/Philanthropist Phil Knight?

Have you read “Shoe Dog,” Professor Reich? Nike almost went under about nine times.

The former Labor Secretary’s “5 ways” Twitter screed is intellectually dishonest, and remarkably easy to discredit.

Alas, it is beneath the respect normally afforded to Robert Reich. Next time go high Mr. Reich instead of racing to the bottom. Talented and hard working people can earn their wealth on their own without resorting to nefarious deeds.

From a policy standpoint, we need to ask:

Should we punish Oprah, Michael, Jay-Z, Uncle Phil and so many others who worked their tushes off to legitimately make their fortunes with a punitive Elizabeth Warren 6 percent wealth tax (up from the original 3 percent proposal), and income tax rates reaching 90 percent or beyond?

Whattyathink Senators Sanders and Warren?

Class warfare — born out of jealousy — is not new.

The effective tax rate for achievers in the United Kingdom in the 1970s once reached 98 percent. If you don’t believe Almost DailyBrett, ask The Beatles … ask The Rolling Stones, who fled to France and recorded “Exile On Main Street.”

Can a near 100 percent confiscatory tax rate, which was thankfully eliminated in the UK by former Prime Minister Margaret Thatcher, happen in the United States of America? Let’s hope not.

Celebrate Instead of Hate?

Almost DailyBrett remembers boys and girls practicing basketball, so they could be “Just Like Mike.”

Your author can imagine girls admiring and wanting to be the next Oprah.

You should check Ellen’s interview with Bill Gates. They discussed the works and deeds of the Bill and Melinda Gates Foundation, donating a cumulative $50.1 billion to fight global childhood poverty and to improve public schools in our country.

According to Forbes, Gates is worth approximately $96.5 billion — give or take a shekel or two — making him the second wealthiest homo sapien on the planet. Virtually everyone in the first world is using Microsoft’s Windows Operating System, inspired and written by Gates. And his charitable foundation has contributed more than any other non-profit ever to make our world a better place (more than most governments).

His former company Microsoft is valued at $1.14 trillion, generates $96.5 billion in annual revenues, and employs 144,000 in well paying positions with full benefits and stock options. Taken together, the performance of Microsoft as a company and the generosity of the Gates Foundation, puts Bill’s wealth into perspective.

Can we have more “policy failures” just like Bill Gates, Phil Knight, Oprah Winfrey, Michael Jordan, Jay-Z and so many more?

Instead of hating people who are wealthy, let’s celebrate and cheer for the achievers (e.g., Michael Jordan).

If we are concerned about billionaires, our policies should focus on stimulating competition (i.e., über-tough content streaming, video game, smart phone markets…), not limitless redistribution or punitive taxation.

If our political intent is to further divide, demonizing billionaires (as others have been publicly denigrated for ages) is a good way to engender one of the seven Deadly Sins: Envy.

If our goal is growth and prosperity, then let’s encourage Millennials and the generations, who will follow, to shoot for the stars. Let them become tomorrow’s Oprah, Michael, Jay-Z, Bill Gates and Uncle Phil.

And if they succeed financially, let’s celebrate them and at the same time root for competitors to keep them on their toes.

https://www.economist.com/leaders/2019/11/09/billionaires-are-only-rarely-policy-failures

https://www.economist.com/finance-and-economics/2019/11/07/have-billionaires-accumulated-their-wealth-illegitimately

https://www.gatesfoundation.org/who-we-are/general-information/foundation-factsheet

https://almostdailybrett.wordpress.com/2019/02/06/the-lonely-guy-standing-in-line-for-a-burger/

https://almostdailybrett.wordpress.com/2012/09/25/taxing-uncle-phil-to-death/

https://almostdailybrett.wordpress.com/2015/08/23/three-comma-club/

https://almostdailybrett.wordpress.com/2011/10/04/taxing-the-fab-four-exiling-the-stones/

Can Amazon’s HQ2 become … HQ1?

Did the Seattle Politburo go too far?

Talk about biting the hand that feeds you … Do they really want to Bern down Seattle’s competitive advantage?

Amazon employs 40,000 in Seattle (headquarters, roasteries and stores).

Let’s see an ANNUAL $275 Seattle employee head tax x 40,000 local workers = $11 million per year … just from Amazonites. Add in Starbucks, Nordstrom, Vulcan etc. and the per-employee tax reaches $48 million

The money  joins the $68 million already ostensibly allocated to fight intractable homelessness in Seattle.

But what inevitably happens when that amount of money is not enough?

As Mrs. Thatcher said: “The Trouble with Socialism is Sooner or Later You Run Out of Other People’s Money.”

Amazon already announced a short list of 19 American cities and one Canadian venue for its planned $5 billion, 50,000 new-employee HQ2 or Headquarters 2.

Are any of these venues threatening to impose a punitive tax on Amazon, just for the privilege of maintaining and hiring the best and the brightest?

What is the incentive to invest in Seattle, if entrepreneurial spirit driving, product producing, employee hiring multi-national, publicly traded companies are hit by its home town city council with the collective backs of their hands?

Let’s see, the State of Washington has no income tax. Seattle has a well-trained workforce.

The Great State of Texas has no income tax. The capital city of Texas has a well-trained workforce too. Austin is also the home of Whole Foods. Jeff Bezos and Amazon bought Austin-based Whole Foods for $13.4 billion last year.

Austin, Texas is on the short-list for Amazon HQ2.

Why can’t Amazon put Seattle in its rear-view mirror? The number one digital retailer/cloud evangelist could simply announce HQ2 (e.g., Austin) and the relocation of HQ1 (Seattle) in the same news release.

As mumsy always said: “If you are in a bad situation, get out of it.”

98 Percent Effective Tax Rate

Seven years ago, Almost DailyBrett wrote about how the UK was Taxing the Fab Four/Exiling the Stones.

Approximately 750,000 Brits qualified for an effective tax rate of 98 percent (no typo) including four from Liverpool and five more from London.

The Beatles responded by writing Tax Man as the first cut, first side of Revolver. The Stones left the UK for the South of France, and produced Exile on Main Street.

At a 98 percent effective tax rate, when does taxation stop and confiscation begin?

Surely, the Stones will never be mistaken for anti-tax warriors. Nonetheless, they demonstrated circa 1971/1972 that achievers can and will move in the face of excessive, unreasonable taxation.

Repealing The Tax … For Now

In the face of a potential referendum, which had already gathered 45,000 signatures, the Seattle City Council reversed course this week, repealing the punitive employee head tax on a 7-2 vote.

How often are tax increases, even so-called “temporary” taxes, rescinded?

The tolls for the Bay Area bridges were originally ticketed to be repealed once the construction bonds were retired. Try driving toward San Francisco on any bridge without first paying $5 or more?

Regardless of the employee head tax repeal, what message has the Seattle City Council sent to the entrepreneurial dreamers, innovators, and job producers who are located (or plan to locate) within the boundaries of the city?

The mere fact that the city council was willing and able to impose an annualized employee head tax $275 on each-and every corporate hire speaks volumes about how publicly traded corporations are viewed by Seattle local government.

Instead of welcoming and embracing entrepreneurs, they are essentially driving them away, their employees and their tax dollars.

Maybe Amazon will take a hint and announce the $5 billion, 50,000 new job HQ2 venue as not only the winning city, but also the new HQ1.

Will the last Amazon employee leaving Seattle, please turn out the lights.

http://komonews.com/news/local/seattle-council-repeals-homeless-head-tax-on-big-businesses

https://almostdailybrett.wordpress.com/2011/10/04/taxing-the-fab-four-exiling-the-stones/

https://www.seattletimes.com/seattle-news/seattle-city-council-to-vote-at-noon-on-repeal-of-big-business-head-tax/

https://www.cbsnews.com/news/seattle-head-tax-amazon-starbucks-repeal-today-2018-06-12/

https://www.king5.com/video/news/local/councilmember-talks-on-repealing-seattles-head-tax/281-8158550

https://www.nytimes.com/2018/06/12/technology/seattle-tax-amazon.html

https://www.nytimes.com/2017/06/16/business/dealbook/amazon-whole-foods.html

https://www.batolls.info/

http://komonews.com/news/local/amazon-starbucks-pledge-money-to-repeal-seattle-head-tax

 

 

 

 

How much intellectual heavy lifting does it take to raise a tax?

Prioritizing and carefully reducing expenditures requires mental gymnastics, but one doesn’t need an Ivy League degree to increase taxes…even though most of these collegiate thoroughbreds advocate doing just that.

Once you have decided to hike taxes to fund even bigger government, more spending (and borrowing), the obvious question is whom should you tax? The answer is oh-so-easy, those who have the worst public relations.

Let’s put on our social justice hats and indulge in a little Schadenfreude and/or sadism.

Who do we most want to suffer? Here are some predictable candidates and potential targets…all in desperate need of better brand management.

Tax the Rich: This is obviously not a new subject (e.g., class warfare) or a new target for increased taxation. Congress recently passed and the president signed the latest tax increase on the rich. Last November, Californians approved Proposition 30 with its “temporary” tax increases on the wealthy, prompting the second best golfer on the planet, Phil Mickelson, to complain (and later to apologize for daring to question taxation in the Land of the Free).

philmickelson

Maybe we should be apologizing to him for imposing a 39.6 percent federal rate, a 13.3 percent (California) state rate; 1 percent state mental health surcharge; 3.8 percent state Medicare surcharge; San Diego County property taxes on his $15 million home; 8 percent sales tax and 20 percent on any capital gains. Essentially, Phil works from January 1 to at least August 31 to pay all of the governments with their hands out.

In the 1970s, the Rolling Stones fled England to escape its punitive 98 percent tax rate (e.g., working from January 1 until December 15 every year to pay the government). Should Mickelson at least move out of California to no-income tax Texas or Florida to reduce his personal tax bite by at least a third? Sounds like a good idea.

Some mocked Phil for complaining about his taxes, insinuating that he had not achieved or earned his income. Let’s see: he won four of the PGA’s grand slam events and 40 tournaments. That fits my definition of achievement. Let’s celebrate it…Oh…Sorry I didn’t mean to hurt anyone’s feelings…

Tax the Endomorphs: Isn’t it fun to snicker at those who can’t push themselves away from the dinner table? “Do I look fat in my outfit?” “Do you have to ask?” “Why do you live to eat as opposed to eating to live?”

There is no doubt that obesity is a major societal problem, so do we “solve” it by making the government obese? Some have suggested a “fat tax.” My first question is what constitutes “fat?” Is this restricted to people who are overweight or obese according to the Body Mass Index (BMI)? That would be one fat tax.

Denmark recently rescinded its fat tax because the heavy dynamic types were going across the border to Sweden and Germany to satisfy their caloric fix. The tiny Scandinavian country was also inadvertently punishing its fine cheese and meat industries, making them uncompetitive in the face of foreign competition.

Tax the Smokers: This dwindling group (for more reasons than one) is probably the most unsympathetic in the eyes of the general public. For example, they are permanently illiterate when it comes to the warnings on the side of each pack.

John Daly

There is little public relations can do to save them from themselves and/or the nicotine. How much further can the government extract from these addicted people? It seems the government is just as hooked on nicotine-stimulated revenues even in the face of more smokers biting the dust.

Just four years ago, Congress passed and the president signed the sweet sounding, “The Children’s Health Insurance Program Reauthorization Act of 2009.” The key was a tax increase on smoking, increasing the federal tax on a pack of smokes from $0.39 to $1.01. This tax is levied on top of the myriad of state taxes on cigarettes, such as $0.87 per pack in California; $1.18 in Oregon; $3.02 in Washington and a whopping $4.35 in New York.

Tax the Lawyers: What do you call 500 lawyers at the bottom of the ocean? A good start.

Whenever a group has earned being the butt of bad jokes with impunity, you know they need help from a public relations standpoint. But do they really need help? Those most inclined to raise taxes on them are the ones that are the political allies of the powerful trial lawyers. Don’t plan on reading about a lawyer’s tax anytime soon, particularly when Democrats control at least one house of Congress and the White House as well.

Tax the Pale Males: There are no greater symbols of white privilege than the pale male (e.g., 43 of America’s 44 presidents). Can you imagine being a rich pale smoking male endomorph attorney?

How many times can you tax this bastard? Ah heck, let’s just confiscate all of his income in the name of “the public good.”

http://ballotpedia.org/wiki/index.php/California_Proposition_30,_Sales_and_Income_Tax_Increase_%282012%29

http://www.cnn.com/2013/01/28/opinion/navarrette-mickelson-freedom/

http://www.forbes.com/sites/matthewcampione/2013/01/25/phil-mickelson-is-moving-from-california-a-mistake-actually-he-should-have-moved-sooner/

http://en.wikipedia.org/wiki/Phil_Mickelson

http://economist.com/news/europe/21566664-danish-government-rescinds-its-unwieldy-fat-tax-fat-chance

http://en.wikipedia.org/wiki/Cigarette_taxes_in_the_United_States

http://en.wikipedia.org/wiki/Tobacco_Master_Settlement_Agreement

https://almostdailybrett.wordpress.com/2011/10/04/taxing-the-fab-four-exiling-the-stones/

“The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the least possible amount of hissing,” — Jean Baptist-Colbert, French Minister of Finances under Louis XIV.

“If you drive a car, I’ll tax the street. If you drive to city, I’ll tax your seat. If you get too cold, I’ll tax the heat. If you take a walk, I’ll tax your feet,” – George Harrison, Beatles’ “Taxman,” 1966.

The Beatles certainly were not the only hugely successful British rock-and-roll band to ever feel the heat of punitive taxation. Nonetheless, they were paying far more than their “fair share” for their musical achievements and the opening song of the band’s “Revolver” album was a form of open protest against excessive taxation and class warfare.

“‘Taxman’ was when I first realized that even though we had started earning money, we were actually giving most of it away in taxes,” said the late George Harrison, the Beatles guitarist. “It was and still is typical.”

For their chief competitors, the Rolling Stones, the crushing taxation in the UK in the 1970s forced the band to leave their homeland, England, to seek refuge in France and record the aptly titled “Exile on Main Street.” Like Napoleon Bonaparte on Elba, the Stones were forced into Mediterranean exile.

exile

The history of the Beatles and the Stones relative to taxation has direct bearing on the modern-day open debate on just how government is too much government and exactly how much taxation is too much taxation. The leader of the free world has called upon the rich to pay their “fair share,” but what exactly is the definition of fair share? And what constitutes “rich” in Obama’s America? The devil is in the details.

Is 98 percent fair? “Preposterous” you say? Not if you review the history of the United Kingdom prior to the rise of Margaret Thatcher.

The “progressive” tax regime of former UK Prime Minister Harold Wilson was simply staggering, a top rate for income tax of 83 percent + a 15 percent surcharge on “un-earned income” (investments and dividends), bringing the marginal rate of 98 percent (no typo). Reportedly, 750,000 British taxpayers were liable for a 98 percent tax rate in 1974. Is there a fine line between taxation and almost total confiscation, and when is that line crossed?

In the case of the Stones, they were not only hissing like plucked geese, but fleeing the country…an option that is always available to the wealthy to escape oppressive taxation. The wealthy (at least for the time being) do have the means, and many times they vote with their feet or by means of air travel.

haroldwilson

Reflecting on the time, former Rolling Stones bassist Bill Wyman said in the band’s DVD “Stones in Exile” that if a band member made a “million quid,” he would be taking home only 70,000 pounds. “It was impossible to make enough to pay Inland Revenue.”

“I had to get out of the country to pay the tax that was incurred on me,” guitarist/song writer Keith Richards remembered.

Singer/song writer Mick Jagger was worried about fan reaction of the Stones leaving the UK for tax reasons, thinking that followers wouldn’t like the Stones anymore. “When you leave for tax reasons, it is not cool.”

But is a 98 percent tax rate cool? Is that paying your “fair share?” Let’s see the achiever gets keep two cents on every dollar, the government takes through a variety of taxing mechanisms the remaining 98 cents on that same dollar.

Extreme? You bet, but it happened. And it occurred in Mother England and it really wasn’t that long ago. As you know, there are some who want America to be just like Western Europe, but do they really support 98 percent taxation?

No one will ever accuse the members of the Beatles and the Stones of being conservative warriors for limited government and Lafferite low taxation to jump-start economic growth. The Stones in particular proved that the real wealthy or the so-called wealthy have options. They can move to lower tax states (e.g. Texas and Florida come immediately to mind) or even to other nations. They may not want to do it, but again they may not have any other choice.

http://en.wikipedia.org/wiki/Stones_in_Exile

http://en.wikipedia.org/wiki/Margaret_Thatcher

http://en.wikipedia.org/wiki/Harold_Wilson

http://en.wikipedia.org/wiki/Exile_on_Main_St.

http://en.wikipedia.org/wiki/Taxman

http://en.wikipedia.org/wiki/Arthur_Laffer

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