Tag Archives: finance

May 18 2014

The Average American Taxpayer pays… WHAT?

If you’re a taxpayer in the United States, you may find it interesting how much you actually pay to businesses and other interests you already pay money to…

Thanks to some compiling by Moyers & Company, and a couple of other sources; I’ve put together a list:

– A policy analysis from the Cato Institute from 2012 shows that the United States Federal Government loses about $100 Billion a year to corporate subsidy, on everything from energy, to the food and housing industries.  With the methodology of 115 million families, that’s over $800 a year.

– The State and Local Governments themselves are different picture.  The New York Times ran an investigation that determined that State and Local (i.e., the County and City/Town level) gave on average $80 Billion.   That adds up to be almost $700 per year.

– Retirement Banking Fees are another hefty loss for taxpayers — on average costing over $350 per year; which assumes a 1% management fee per year of one’s retirement fund, and a middle-range percentile retirement fund amount as cited by the Economic Policy Institute was assumed to be about $35,000.

– A report by the International Monetary Fund reports that over $83 Billion winds up in interest payments on loans and banking.  That accounts to $722 per year.  A further sobering fact: the five wealthiest banks in the world, JPMorganChase, Bank of America, Citigroup, Wells Fargo and Goldman Sachs account for THREE QUARTERS of these subsidies!

– Overpriced Medications were a surprise to me on this list — while the notion itself was not, the amount certainly was.  A study conducted by the Center for Economic and Policy Research found that US drug patent monopolies raises the price of prescription medications in the US by over $270 Billion per year!  That translates to over $2000 per year.

– $870 per year goes to corporate tax subsidies, which total about $100 Billion per year, as mentioned by The Tax Foundation.  This includes everything from depreciation, and even experimental tax credits.

– Corporate Tax havens are a very serious problem.  Indeed, the US Public Interest Research Group found that the average taxpayer family paid $1231 per year to offset the losses by those [such as large banks and wealthy individuals] who offshore their monies to avoid taxation.

According to my calculations, that’s $4873 PER YEAR.  Almost five thousand dollars; assuming an average income of about $50,000.

Consider these numbers, when one looks at what they pay out for social programs:

– The Examiner released some information in 2012 about what Americans pay in social programs, such things as Education, etc.  A complete list can be found at that link, but leaving out the costs of Defense [as the Military Contract Industry is another racket in and of itself…], the costs turned out to be LESS than $500 PER YEAR.  This accounts for everything including Veterans Benefits spending, Housing, SSI, and even things like our contributions to the Railroad Retirement Fund!

…who should you *really* be mad at when it comes to who can’t afford what?  Where *IS* the “Big Government,” really?  I’ll let you decide.

I freely admit, I’ve abridged *some* information — mostly, related to Defense in Social Spending, but that, to me, doesn’t count…  and even then, admittedly, is only another $250 per year.  I also admit, I rounded *UP* on those figures — so the *actual* costs for Social Programs, are ACTUALLY a little lower.   But I’m a fair guy.

All of a sudden, the political cartoon above isn’t so ridiculous, is it?

I want to especially thank Moyers & Co., and Paul Buchheit for their work on compiling some of this data.

Mar 22 2013

Socialized Capital — The next evolution of Capitalism?

One of my personal heroes is Professor Muhammad Yunus, the founder and former managing director of Grameen Bank.  A social entrepreneur who inadvertently birthed the idea of Microcredit.  From it spawned a new era in financing, while modeled for the poor — Grameen Bank’s ideas and basics spawned everything from Kiva, which I’m a member of, to Kickstarter and Indiegogo.  Microcredit/Microfinance/Crowdfinance has gone from an uncertainty, to a now accepted business practice, with everything from money for the poor, to basement start-ups and high-tech entrepreneurs who are just looking for a fresh infusion of capital to get them going, when they may not qualify for a traditional loan or grant otherwise.  This socially-geared form of finance has proven highly successful, both in “grant” style, and in loan-repayment style — Kiva often bills itself as having higher repayment rates than most banks in the United States do.

The world’s economy has gone through three major cycles in it’s history:

– The Agrarian economy, which was from the birth of civilization, till about the industrial revolution, which consisted of land owners as the upper class, and the land workers as the lower class.  Land was the king here.  Agriculture and husbandry was the big thing here.

– The Capitalist economy, which took off during the industrial revolution, and continued through to World War II.  Here, MONEY was the king.  You had Capitalists as the upper class, and the Blue collar people as the middle and lower class.  Here, it was about paper money, and [generally] unskilled labor.

– The Post-Capitalist economy began after World War II, was a drastic shift from where simply having money didn’t mean you made money.  You now needed to have knowledge.  Knowledge-based workers are the upper class, more often than not, and service-based workers are the middle and lower classes, more often than not.  Those who succeed MAY have a healthy dose of capital, but it’s usually more often that their knowledge in an industry or a specific sub-set of skills makes them successful in their given area.

Is this the future of capitalism in the world?  Will the 21st century be the birth of the next evolution in our world’s economy?

Some Links:

– Professor Muhammad Yunus talks about the birth of his idea of Microcredit
– Some background on Amartya Sen, another economist I admire

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