If you do not know what you are talking about or not willing to debate the details of this and real cause and effect....on a macro economic (national) level as well as global level...
well, quit while you are ahead. This topic needs to be understood firstly in the specifics and secondly at those levels.
Remember, EP does not do "philosophy" where people just jump on something without first comprehending what it actually is. We leave that to the political blogs.
I'm not sure because I am not in B school, others with MBAs can comment, but my impression is as a rule they believe if one just takes care of the next quarter, the long term will take care of itself.
Now that is quite short sighted. Japan, China are notorious for long term strategy sessions at both the micro economic (each corporation) and macro economic level.
I also think they are operating on some serious mistakes of assumptions....i.e. if they do the China PNTR they will make billions financing it all, with the additional free movement of capital, la de da....(now we are owned by China, that worked out well), or say labor arbitrage. It's like they are looking at head count as "cattle count" in their labor stats, not getting that the more workers are treated as disposable, the longer the quality will suffer and it gets really bad once one gets into the production and innovation skill sets.
Or they think wages and no one bothers to check "income" and the effect on a macro economic scale...
or say they think "minor regional economic disruptions" that are "temporary" not thinking all of these add up to economic Armageddon and in a graph "temporary" is actually 50 years.
I'm wondering if B school takes people out back and beats out of 'em any common sense. ;)
I want to stop imports and have a "domestic manufacture first" mentality- create the goods as close to the end consumer as possible, end the waste of hundreds of thousands of barrels of oil for shipping, send information instead because it is cheaper, create jobs as close to the consumer as possible.
DECENTRALIZE, not RECENTRALIZE!
I'm all for exiting the WTO altogether and creating a $1/mile shipping tax, on all goods domestic and foreign.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
Are basically raising the cost to their own consumers, in an effort for the exporting class to get rich.
What is good for the goose is not always good for the gander- and there IS another answer- stop playing the game. Take our ball and go home.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
We don't process state sales tax, because we don't have one. We've voted on it 13 times now, and it's gone down in defeat every time, because we in Oregon oppose *ANY* consumption taxes.
It can't be all done at the register- at some point, the company has to read the registers, total up the tax collected, and send off a check to the state. That takes at least *some* time. It may be trivial, but it's overhead.
I agree we are in an unfair situation- but to me, the solution is staring us in the face- isolationism. Get the hell out of the WTO, tell the international corporations to go elsewhere, stop exporting and importing altogether, and let the world fend for itself for a few years.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
Missed this (and jez I only try to put the government blogs on the right hand column so we get the juice straight from the source!) CBO on recovery.
Now, note their claims on "Stimulus", which we have been highly critical of in terms of not being funneled abroad or to enable more outsourcing, etc.
So far that has not materialized.
But they are predicting a "Recovery" with all sorts of further bad news, including a total 7% GDP "gap" in terms of what the economy should be doing at full output.
I'm wondering now about the CBOs track record in terms of projected vs. actual. Now I assuredly think they are a critical reference point, although I prefer the GAO in terms of gut wrenching statistics and accuracy, but wouldn't it be interesting to see a graph of major projections vs. actual?
I do know the BLS "occupational growth outlook" is consistently wrong.
about long-term. Most have more money then they need to survive for the rest of their lives. What do they care if in the long-term the "race to the bottom" destroys the middle class? All they know or care about is the short-term.
First, a VAT is a tax on all goods sold, whether imported or domestically produced. The WTO rule is that you cannot tax imports at a higher rate than the comparable domestic good.
Second, the best route to a VAT would be a comprehensive tax reform. That would remove some of the burden of current taxes (corporate income, excise, real estate, etc.) that currently is hidden in the cost of the goods. On the household side, presumably there would be a substantial reduction in the incidence of income and payroll taxes on lower-income folks. That plus a refundable tax credit for VAT paid (based on the current EIT) would be enough to minimize any regressivity.
Third, a border adjustable VAT would be the single most potent stimulus to exports possible. Unlike the traditional subsidy route, it requires no expenditure of public funds and avoids selective (usually politically inspired) support of favored industries.
Our trading partners are openly amused by Americans' short-sighted preoccupation with taxes. I've been asked by Canadians: "Why are you so stupid about this?" Sorry to disappoint the "anti-tax" crowd, but we currently are relatively low taxed. At the same time, we are badly taxed. Imports do not pay their fair share; exports are double taxed. Most corporations spend a lot of money to avoid paying anything in corporate income tax. The underground economy pays nothing in income tax. And yet some people want to defend this as a functional system!!!
America needs to grow up, get its spending under control, incentivize real production in this country, pay down its debt and regain its financial strength. This can't be accomplished by endless borrowing from our trading partners. Nor can it be be accomplished in a world in which everyone but the USA enjoys the advantages of a border-adjustable consumption tax.
I think Roubini called the green shoots, yellow weeds.
On the other hand EIs (economic indicators), and patterns, correlations, are very real in terms of measuring the overall economic health.
That said, when keyword jobless recovery pops up, that to me says no economic recovery because I am on the ground, in the real world, trying to pay the rent.
So, I think we need to amplify the economic recovery for MNCs (multinational corporations) versus the U.S. middle class....and by that metric, labor, jobs, the U.S. middle class has been sliding to shit for years.
But as we can see (from NDD's posts to others who cover EIs) income, labor is now directly affecting the other major EIs so we have bubble up disaster because the U.S. middle class has been tapped out.
This would make a great original post, to correlate the tapping out of the U.S. workforce, the U.S. middle class to overall macroeconomic indicators being repressed.
I swear to God there is this major disconnect between these corporate elites, globalists and how screwing the American people directly affects their bottom line over a long term period.
I think they have deluded themselves into believing somehow they will simply replace the U.S. middle class with some mythical 2.3 billion consumer market in India and China.
I had missed this earlier post, but there's another side of this that was brought up on a survivalist blog I belong to, that should worry everybody.
This means, in effect, the Obama administration has 3 choices:
1. Abandon stimulus- not affordable any more
2. Print more funny money to borrow from the FED- hyperinflation.
3. Raise taxes and create a windfalls profit tax.
You know #3 won't happen. You know #1 can't happen unless they're ready to abandon the nation completely. Which leaves #2. And if the conspiracy theorists are right, a Wag-the-dog artificial national disaster to distract people while they do it would be in order.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
I'm not going to argue with someone who isn't going to do their own research and investigation right now.
When I get to writing up a post, feel free, but in the interim, read the past posts I have using the search and hit de Google on WTO VAT keywords.
I think you are missing the point of their articles. The point is to understand how the EU, China etc. use their own VATS on imports and exports. While yes they are arguing for a VAT being unfair, the point of the references is since one cannot get any VAT ruled illegal or anything done by these nations or the WTO....one needs to play what is good for the goose is good for the gander game.
Also realize each nation has it's own VAT system. It is not uniform globally. So, each nation crafts it's own VAT system.
"As we look at the economy, I have to be honest: we're not seeing the green shoots," Sokol said at the annual Ira Sohn Investment Research conference, which drew some 1,200 hedge fund executives to hear top investors share trade ideas.
"That's not surprising to us. It took us 11 years to get into this mess where it is. We went into the emergency room last fall and by January the banking system and economy generally were in intensive care, and we'd expect it to stay there for some time," Sokol said.
If anything, the glut of housing supply could grow larger as a new wave of foreclosures and pending sales breaks on the market.
"We think the official statistics of 10 to 12 months' backlog is actually nearly twice that amount,"
about the same as processing any state sales tax, all done at the register, automatic.
Look, you are in a mind set and you need to empty your brain and listen to what these people are telling you and think this through.
I am not for a regressive tax, of course I am not. Anything that dumps even more burden on the U.S. middle class and poor is a very bad idea.
But this is all about meeting the WTO rules and if there is anything regressive going on these days....it is displacing U.S. workers with guest workers and offshore outsourcing their jobs and lowering their wages...
i.e. a completely unfair situation where Americans are directly competing with overall labor costs of other nations that are on a ratio of 12:1, 6:1 even 100:1.
I promise I will work up a detailed post with graphs and examples. (it's a real job).
But for now, check out those Economy in crisis articles and buy (go to the library) Pat Choate's book. Now you might like him, he was Ross Perot's VP on the 2nd run but more importantly is an economist and he goes into this concept in multiple book chapters.
I know it sounds ridiculous but in the case of a VAT it's all legal via the WTO.
tax foundation has a good post w.r.t. the FTC which is what I think you believe is illegal (and it was ruled illegal by the WTO)
n part, the U.S. adopted the FSC to offset a competitive advantage enjoyed by our European trading partners, an advantage that stems from their tax system. They levy a value-added tax (VAT) on imports but not on exports. This boost to European exporters is something we can’t match because we don’t have a VAT. As a substitute, the FSC reduces the U.S. tax so that the combined U.S. income and European VATs do not render U.S. exports uncompetitive, whether they are bound for Europe or other countries.
This worked until the World Trade Organization (WTO), responding to a complaint from the European Union, ruled that the FSC violates international law. The U.S. has until October 1, 2000 to repeal the FSC or suffer WTO-sanctioned retaliation.
Taking a step back, the FSC dispute highlights an unfortunate fiction defended with gusto in Europe, elsewhere around the world, and even in some quarters in the United States. When the original articles of the General Agreement on Tariffs and Trade (GATT), the WTO’s precursor, were written, it was popular in academic circles to make much of the distinction between “direct” taxes – those paid directly to the tax administrator, such as an income tax – and “indirect” taxes – those paid to the administrator indirectly when making a purchase, such as a sales tax or a VAT. Under the GATT, and now under the WTO, a country may employ border tax adjustments – export rebates and import levies – to reflect indirect taxes, but it may not employ these devices to reflect direct taxes. Upon this economically irrelevant distinction the WTO hangs its discrimination charge against the U.S. income tax, much to the detriment of U.S. trade.
Business taxes furnish an example of how silly this is. Under the WTO definition of the term, a sales tax is an indirect tax, as is an European-style VAT. The economic equivalence of an European-style VAT and a subtraction-method VAT is well-established. A subtraction-method VAT is essentially identical to a business income tax except that all purchases of plant and equipment may be expensed, rather than depreciated as under current U.S. law.
Also, I believe you mean GATT, not GATS. GATS is trade and services, different side treaty. GATS is where they are trying to dump in guest workers (i.e. people, but keeping and assuming their national origin loyalty, as something to trade).
And have two points from them:
1. Both articles are arguing for *elimination* of the VAT, not for enacting a new VAT in the United States. I think there's good reason for this, but that brings me to:
2. Neither article had a good analysis of what happens to consumer prices after a VAT is in place for domestic vs foreign goods- and it's the consumer side that I and others doubt.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
You need to deduct the cost of processing the rebate as well.
So while this may be a "trade leveler", the real person that will get hurt is the consumer.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
You've got two different VAT's at work here ... the one that is nothing but a disguised tariff and the one that is allowed by the WTO.
A tariff would put a tax on imports that is NOT placed on domestic product. A VAT, if it is the non-discriminatory Value Added Tax allowed by the WTO, would place the same tax on imports that is placed on domestic products.
If we lived in a country where a VAT would replace payroll income taxes, swapping one regressive tax for another, with an eye to simplifying a system for rebating that portion of our total taxes on income on exports ... eliminating the 12%+ income tax on all incomes up to $100,000 and replacing it with a tax where at the very least there would be some marginal tax payment from the multi-million dollar income range, combined with the relative ease of rebating a VAT on exports compared to the greater difficulty of rebating payroll taxes on exports ...
... that would certainly merit discussion.
But false claims to the effect that the total amount of VAT assessed on imports is equal to a protective tariff of that amount, and the total amount of VAT rebated on imports is equal to a subsidy of that amount ... they certainly would not add anything but noise to that discussion.
And, clearly, the proposal of the VAT is with an eye to sheltering corporate incomes and capital gains from tax, by finding more regressive taxation in addition to existing regressive taxes.
The WTO GATS treaty ban on taxing only foreign goods, if it is not levied against domestic goods as well?
Or better yet, can you explain to me how any consumption tax can avoid taxing domestic goods without being discriminatory?
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
at least when President Obama took over a complete emphasis on improving the job situation and keeping people in their homes - WPA-like, more stimulus money over tax cuts.
Sad reality is that we, consumers, drive the economy not the financial sector. If we have work then this mortgage/foreclosure crisis doesn't spread.
What happened to "bottom up" approach that was talked about?
If you do not know what you are talking about or not willing to debate the details of this and real cause and effect....on a macro economic (national) level as well as global level...
well, quit while you are ahead. This topic needs to be understood firstly in the specifics and secondly at those levels.
Remember, EP does not do "philosophy" where people just jump on something without first comprehending what it actually is. We leave that to the political blogs.
I'm not sure because I am not in B school, others with MBAs can comment, but my impression is as a rule they believe if one just takes care of the next quarter, the long term will take care of itself.
Now that is quite short sighted. Japan, China are notorious for long term strategy sessions at both the micro economic (each corporation) and macro economic level.
I also think they are operating on some serious mistakes of assumptions....i.e. if they do the China PNTR they will make billions financing it all, with the additional free movement of capital, la de da....(now we are owned by China, that worked out well), or say labor arbitrage. It's like they are looking at head count as "cattle count" in their labor stats, not getting that the more workers are treated as disposable, the longer the quality will suffer and it gets really bad once one gets into the production and innovation skill sets.
Or they think wages and no one bothers to check "income" and the effect on a macro economic scale...
or say they think "minor regional economic disruptions" that are "temporary" not thinking all of these add up to economic Armageddon and in a graph "temporary" is actually 50 years.
I'm wondering if B school takes people out back and beats out of 'em any common sense. ;)
I want to stop imports and have a "domestic manufacture first" mentality- create the goods as close to the end consumer as possible, end the waste of hundreds of thousands of barrels of oil for shipping, send information instead because it is cheaper, create jobs as close to the consumer as possible.
DECENTRALIZE, not RECENTRALIZE!
I'm all for exiting the WTO altogether and creating a $1/mile shipping tax, on all goods domestic and foreign.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
Are basically raising the cost to their own consumers, in an effort for the exporting class to get rich.
What is good for the goose is not always good for the gander- and there IS another answer- stop playing the game. Take our ball and go home.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
We don't process state sales tax, because we don't have one. We've voted on it 13 times now, and it's gone down in defeat every time, because we in Oregon oppose *ANY* consumption taxes.
It can't be all done at the register- at some point, the company has to read the registers, total up the tax collected, and send off a check to the state. That takes at least *some* time. It may be trivial, but it's overhead.
I agree we are in an unfair situation- but to me, the solution is staring us in the face- isolationism. Get the hell out of the WTO, tell the international corporations to go elsewhere, stop exporting and importing altogether, and let the world fend for itself for a few years.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
Missed this (and jez I only try to put the government blogs on the right hand column so we get the juice straight from the source!) CBO on recovery.
Now, note their claims on "Stimulus", which we have been highly critical of in terms of not being funneled abroad or to enable more outsourcing, etc.
So far that has not materialized.
But they are predicting a "Recovery" with all sorts of further bad news, including a total 7% GDP "gap" in terms of what the economy should be doing at full output.
I'm wondering now about the CBOs track record in terms of projected vs. actual. Now I assuredly think they are a critical reference point, although I prefer the GAO in terms of gut wrenching statistics and accuracy, but wouldn't it be interesting to see a graph of major projections vs. actual?
I do know the BLS "occupational growth outlook" is consistently wrong.
about long-term. Most have more money then they need to survive for the rest of their lives. What do they care if in the long-term the "race to the bottom" destroys the middle class? All they know or care about is the short-term.
First, a VAT is a tax on all goods sold, whether imported or domestically produced. The WTO rule is that you cannot tax imports at a higher rate than the comparable domestic good.
Second, the best route to a VAT would be a comprehensive tax reform. That would remove some of the burden of current taxes (corporate income, excise, real estate, etc.) that currently is hidden in the cost of the goods. On the household side, presumably there would be a substantial reduction in the incidence of income and payroll taxes on lower-income folks. That plus a refundable tax credit for VAT paid (based on the current EIT) would be enough to minimize any regressivity.
Third, a border adjustable VAT would be the single most potent stimulus to exports possible. Unlike the traditional subsidy route, it requires no expenditure of public funds and avoids selective (usually politically inspired) support of favored industries.
Our trading partners are openly amused by Americans' short-sighted preoccupation with taxes. I've been asked by Canadians: "Why are you so stupid about this?" Sorry to disappoint the "anti-tax" crowd, but we currently are relatively low taxed. At the same time, we are badly taxed. Imports do not pay their fair share; exports are double taxed. Most corporations spend a lot of money to avoid paying anything in corporate income tax. The underground economy pays nothing in income tax. And yet some people want to defend this as a functional system!!!
America needs to grow up, get its spending under control, incentivize real production in this country, pay down its debt and regain its financial strength. This can't be accomplished by endless borrowing from our trading partners. Nor can it be be accomplished in a world in which everyone but the USA enjoys the advantages of a border-adjustable consumption tax.
I think Roubini called the green shoots, yellow weeds.
On the other hand EIs (economic indicators), and patterns, correlations, are very real in terms of measuring the overall economic health.
That said, when keyword jobless recovery pops up, that to me says no economic recovery because I am on the ground, in the real world, trying to pay the rent.
So, I think we need to amplify the economic recovery for MNCs (multinational corporations) versus the U.S. middle class....and by that metric, labor, jobs, the U.S. middle class has been sliding to shit for years.
But as we can see (from NDD's posts to others who cover EIs) income, labor is now directly affecting the other major EIs so we have bubble up disaster because the U.S. middle class has been tapped out.
This would make a great original post, to correlate the tapping out of the U.S. workforce, the U.S. middle class to overall macroeconomic indicators being repressed.
I swear to God there is this major disconnect between these corporate elites, globalists and how screwing the American people directly affects their bottom line over a long term period.
I think they have deluded themselves into believing somehow they will simply replace the U.S. middle class with some mythical 2.3 billion consumer market in India and China.
Seriously and they are smokin' crack.
I had missed this earlier post, but there's another side of this that was brought up on a survivalist blog I belong to, that should worry everybody.
This means, in effect, the Obama administration has 3 choices:
1. Abandon stimulus- not affordable any more
2. Print more funny money to borrow from the FED- hyperinflation.
3. Raise taxes and create a windfalls profit tax.
You know #3 won't happen. You know #1 can't happen unless they're ready to abandon the nation completely. Which leaves #2. And if the conspiracy theorists are right, a Wag-the-dog artificial national disaster to distract people while they do it would be in order.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
I'm not going to argue with someone who isn't going to do their own research and investigation right now.
When I get to writing up a post, feel free, but in the interim, read the past posts I have using the search and hit de Google on WTO VAT keywords.
I think you are missing the point of their articles. The point is to understand how the EU, China etc. use their own VATS on imports and exports. While yes they are arguing for a VAT being unfair, the point of the references is since one cannot get any VAT ruled illegal or anything done by these nations or the WTO....one needs to play what is good for the goose is good for the gander game.
Also realize each nation has it's own VAT system. It is not uniform globally. So, each nation crafts it's own VAT system.
recovery w/out jobs and a horrible housing market?
What 'green shoots' (h/t Calculated Risk)?
That doesn't sound like a recovery to me.
about the same as processing any state sales tax, all done at the register, automatic.
Look, you are in a mind set and you need to empty your brain and listen to what these people are telling you and think this through.
I am not for a regressive tax, of course I am not. Anything that dumps even more burden on the U.S. middle class and poor is a very bad idea.
But this is all about meeting the WTO rules and if there is anything regressive going on these days....it is displacing U.S. workers with guest workers and offshore outsourcing their jobs and lowering their wages...
i.e. a completely unfair situation where Americans are directly competing with overall labor costs of other nations that are on a ratio of 12:1, 6:1 even 100:1.
I promise I will work up a detailed post with graphs and examples. (it's a real job).
But for now, check out those Economy in crisis articles and buy (go to the library) Pat Choate's book. Now you might like him, he was Ross Perot's VP on the 2nd run but more importantly is an economist and he goes into this concept in multiple book chapters.
I know it sounds ridiculous but in the case of a VAT it's all legal via the WTO.
tax foundation has a good post w.r.t. the FTC which is what I think you believe is illegal (and it was ruled illegal by the WTO)
Also, I believe you mean GATT, not GATS. GATS is trade and services, different side treaty. GATS is where they are trying to dump in guest workers (i.e. people, but keeping and assuming their national origin loyalty, as something to trade).
And have two points from them:
1. Both articles are arguing for *elimination* of the VAT, not for enacting a new VAT in the United States. I think there's good reason for this, but that brings me to:
2. Neither article had a good analysis of what happens to consumer prices after a VAT is in place for domestic vs foreign goods- and it's the consumer side that I and others doubt.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
You need to deduct the cost of processing the rebate as well.
So while this may be a "trade leveler", the real person that will get hurt is the consumer.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
... the trade deficit in this way?
You've got two different VAT's at work here ... the one that is nothing but a disguised tariff and the one that is allowed by the WTO.
A tariff would put a tax on imports that is NOT placed on domestic product. A VAT, if it is the non-discriminatory Value Added Tax allowed by the WTO, would place the same tax on imports that is placed on domestic products.
If we lived in a country where a VAT would replace payroll income taxes, swapping one regressive tax for another, with an eye to simplifying a system for rebating that portion of our total taxes on income on exports ... eliminating the 12%+ income tax on all incomes up to $100,000 and replacing it with a tax where at the very least there would be some marginal tax payment from the multi-million dollar income range, combined with the relative ease of rebating a VAT on exports compared to the greater difficulty of rebating payroll taxes on exports ...
... that would certainly merit discussion.
But false claims to the effect that the total amount of VAT assessed on imports is equal to a protective tariff of that amount, and the total amount of VAT rebated on imports is equal to a subsidy of that amount ... they certainly would not add anything but noise to that discussion.
And, clearly, the proposal of the VAT is with an eye to sheltering corporate incomes and capital gains from tax, by finding more regressive taxation in addition to existing regressive taxes.
The WTO GATS treaty ban on taxing only foreign goods, if it is not levied against domestic goods as well?
Or better yet, can you explain to me how any consumption tax can avoid taxing domestic goods without being discriminatory?
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
at least when President Obama took over a complete emphasis on improving the job situation and keeping people in their homes - WPA-like, more stimulus money over tax cuts.
Sad reality is that we, consumers, drive the economy not the financial sector. If we have work then this mortgage/foreclosure crisis doesn't spread.
What happened to "bottom up" approach that was talked about?
I ask the question again: Did Fed and Treasury waste $12 trillion?
not so fun to toil away at some policy, craft a solution to then be called an idiot.
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