Progressives

Chris Banescu: Bishop Savas is Wrong on Taxes on the Poor and the Rich


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Chris Banescu corrects some bad math and sloppy assertions.

Source: A Voice in the Wilderness | Chris Banescu

Bp. Savas (GOA)Bishop Savas (Zembillas), GOA’s Director of the Office of Church and Society, has launched into yet another missive against conservatives whom he frequently condemns of hating the poor and only protecting the rich. On his facebook page, the main venue where one can find the bishop’s real views and interests, he recently posted a blame Republicans editorial from The New York Times titled “The New Resentment of the Poor.” Apparently forgetting that envy is a sin and truth-telling a virtue, Bishop Savas highlights his class-warfare passions in several false claims he posted in the discussions related to the NYT article.
 
This is not the first time Bishop Savas has posted such biased hit pieces on his Facebook wall. He has a long history of supporting pro-Democrat and anti-Republican views via his many postings of overwhelmingly liberal and leftist-leaning commentary from NPR and The New York Times, his favorite sources of “balanced and objective” news and views. However, this latest editorial further showcases his superficial and misinformed thinking on taxation via several outlandish statements that distort the truth and advance a leftist/progressive agenda.

Falsehood #1 – Employee Social Security and Medicare Tax Rates
In the comments section below The New York Times editorial link, Bishop Savas makes this claim (emphasis mine):

“even those who don’t pay federal income tax pay 16% of their total income on taxes. A person making $30,000 pays around $5,000.”

What he calls “total income on taxes” are the combined Social Security and Medicare taxes that individuals must pay to the federal government (in addition to federal and state income taxes). These are taxes that are automatically deducted by employers from their employees’ payroll checks. Based on the numbers he cited, employed individuals would pay a 16.7% ($5,000 divided by $30,000) combined Social Security and Medicare tax rate on income. Unfortunately, the bishop’s assertion is wildly inaccurate. He’s not just wrong by a few percentage points, but off by more than 100%.

According to federal government guidelines, by law employees are required to pay a 6.2% Social Security tax and a 1.45% Medicare tax on their earnings. This means that employed individuals must pay a combined SS/Medicare tax of 7.65% on their income. The employer must also match those taxes and pay an additional 7.65% of the employee’s salary directly to the federal government. Those additional taxes are paid by the employer only and are not deducted from the employee’s earnings.

Relying on some simple web research and basic math, we arrive at $2,295 per year of Social Security and Medicare taxes that employees earning $30,000 per year actually pay (nowhere near the $5,000 alleged). The matching $2,295 in SS/Medicare taxes are paid solely by an employer from his own earnings, not the employee’s pocket. This means that Bishop Savas’ erroneous example exaggerates these taxes by nearly 218%, asserting a fictional 16.7% vs. an actual 7.65% tax rate; a percentage two times bigger than reality.

Falsehood #2 – Viacom CEO Salary for 2010
The second falsehood from Bishop Savas, in the same facebook section, focuses on the 2010 salary of Viacom’s CEO (emphasis mine):

“The CEO of Viacom made $754,000,000 last year – around $2,000,000 a day, give or take. What percentage do you think he owes in taxes?

Such an enormous salary, nearly 3/4 of a billion dollars, for just one year’s worth of work is indeed shocking. The problem is that it’s not true. The assertion is meant to scandalize the reader and justify resentment of the other. It’s an audacious condemnation in support of the same liberal/leftist bias seen in the NYT article posted on his facebook wall. Bishop Savas is shamelessly distorting the facts.

A quick search on Google reveals the truth regarding the actual compensation that Mr. Phillippe Dauman, the CEO of Viacom, was awarded last year. As reported by the Los Angeles Times:

“Viacom Inc. Chief Executive Philippe Dauman was awarded salary, stock and other benefits totaling $84.5 million during the nine months of 2010 that were covered in Viacom’s fiscal year.

That amount included one-time stock award worth $31.65 million — money that was not paid to Dauman in 2010 but will vest over the next five years if the company achieves certain performance goals. The grant was bestowed on Dauman as a signing bonus in April after he extended his employment contract six and a half years.”

Notice immediately that the 2010 “awarded salary, stock and other benefits” is orders of magnitude smaller than the bishop’s imaginary amount. It is only $84.5 million vs. $754 million. Notice also, that a large portion of that salary, $31.65 million in fact, is deemed as “one-time stock award”; it hasn’t been paid to Mr. Dauman yet. That amount will vest over the next five years if the company meets very specific performance guidelines. He will only receive that compensation in the future if he fulfills the goals identified in his 5-year contract with Viacom.

The money Mr. Dauman was actually paid in 2010 is probably closer to $52.85 million. That’s indeed a nice chunk of change. But, it’s a whopping 1,427% smaller than what Bishops Savas said it was. That’s quite a discrepancy! Yes, we’re still talking about large amounts of money, but why the need for such ludicrous embellishment?

Even assuming a very superficial reading of the LA Times piece and using the $84.5 million compensation number, still leaves us with a 892% exaggeration of the facts. Is the desire to justify a viewpoint and promote an agenda so powerful that accuracy and truth no longer matter?

Falsehood #3 – Total Income Tax Rates on the Rich
Bishop Savas also erroneously assumes that someone earning $754 million per year would only pay $250 million in taxes:

“The CEO of Viacom made $754,000,000 last year – around $2,000,000 a day, give or take. What percentage do you think he owes in taxes? Say, for the sake of argument, he pays back $250,000,000. That would leave him with only a little more than half a billion dollars. Who would have made the greater sacrifice, him or the guy who paid $5,000 out of his $30k? Who is likely to have felt it more?”

Using his numbers gives the impression that a rich CEO pays only 33.1% in income taxes, allowing him to keep 66.9% of what he earned. This is also not true.

First of all, the marginal Federal Income Tax rate is currently 35% for anyone earning more than $379,150 per year (cut-off was $373,650 in 2010). Right away, the bishop’s math is off by almost 2%. [NOTE – the federal tax rates are less for the first $379,150 earned, but for practical purposes when dealing with millions in income the effective rate approaches 35%.]

Second of all, Bishop Savas conveniently leaves out an additional 1.45% Medicare tax that the federal government imposes on all income earned. This raises the federal tax to 36.45%. And we’re not done yet. State incomes taxes must also be paid.

Assuming that Mr. Phillippe Dauman is a resident of New York (a fair assumption since the corporate headquarters of Viacom Inc. are in New York City), he must also pay state and local income taxes due each year. A brief overview of New York’s state tax laws by the nonpartisan Tax Foundation reveals a tax rate of 8.97% on all income over $500K per year. We’ll round that out to 8.9% for simplicity and to account for the slightly smaller tax rates bellow the half million dollar mark.

Adding the 8.9% NY state tax rate to the 36.45% Federal tax rate brings the Total Tax Rate to 45.35%, roughly 37% larger than Bishop Savas asserts. Had Mr. Dauman actually earned $754 million for 2010, the IRS and New York State authorities would have appropriated about $342 million of that money (almost half), not $250 million (only a third) as claimed.

The reality is that New York taxpayers in the highest income brackets keep just 54.65% of what they actually earn each year. This is significantly less than the fictional 66.9% asserted by Bishop Savas. Nearly half of what the rich earn is confiscated and redistributed by the government. What’s wrong with sticking with the facts?

Better Silence Than Foolishness
As Abraham Lincoln once observed, it is often “better to remain silent and be thought a fool than to open one’s mouth and remove all doubt.” A little moderation would be wise before stepping into the public arena and proclaiming such whoppers. This is especially egregious given that the truth is just a few keystrokes away, discoverable via a few Google searches and some basic math.

It’s been said that economists should not do religion. Maybe religious figures should not do economics.

The Preferential Option for the Poor


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Source: First Things

Catholic writer R.R. Reno explains why he became a social conservative. Catholic social teaching has always stressed a “preferential option for the poor” which certainly conforms to Orthodox moral teaching particularly in reference to Matthew 25. Where it gets hazy however is when we discuss how policy should be crafted that meets this obligation. Some Catholics, particularly liberals, embrace the Progressive social agenda taking Progressive rhetoric about care for the poor at face value. Orthodox liberals do the same thing.

Reno used to be in that camp until he came to see that care for the poor cannot be reduced to money alone, especially in America. The poor in America also suffer from a depletion of social capital particularly the values and habits that make the climb out of material deprivation possible. This view of course is politically incorrect, but then political correctness is nothing more than pressure from those whose ideas can’t stand up under close scrutiny. Some highlights:

The social reality of contemporary America is painfully clear. By and large, the rich and powerful don’t desire more wealth nearly as much as they desire moral relaxation and the self-complimenting image of themselves as nonconformists living a life of enlightenment and freedom in advance of dull Middle America. Meanwhile, on the South Side of Chicago—and in hardscrabble small towns and decaying tract housing of old suburbs—the rest of America suffers the loss of social capital.

I must admit that I often feel frustrated by my liberal friends who worry so much about income inequality and not at all about moral inequality. Their answer is to give reparations. Are we to palliate with cash—can we palliate with cash—the disorder wrought by Gucci bohemians?

No. Progressives talk about “social responsibility.” It is an apt term, but it surely means husbanding social capital just as much as—indeed, more than—providing financial resources. In our society a preferential option for the poor must rebuild the social capital squandered by rich baby boomers, and that means social conservatism. The bohemian fantasy works against this clear imperative, because it promises us that we can attend to the poor without paying any attention to our own manner of living. Appeals to aid the less fortunate, however urgent, make few demands on our day-to-day lives. We are called to awareness, perhaps, or activism, but not to anything that would cut against the liberations of recent decades and limit our own desires.

A year or so ago I got together with some college friends. Good guys—careers, families, some churchgoers, others not, all involved in their communities. For the most part bourgeois in the best sense. But a few were perplexed. They wanted to know why I had become a social conservative.

I wasn’t able to give a very good answer. But I’ve continued to think about it. Yes, I’ve come to see the moral urgency of protecting the unborn and defending traditional marriage, as well as restoring the virtues of civility and self-discipline. But there’s something more, and it concerns a basic biblical principle.

In the Gospel of Matthew we find Jesus warning us about how our lives will be judged. His words are pointed. We are to feed the hungry, welcome the stranger, clothe the naked, and visit the prisoner. For what we do to the poor and the destitute—“the least of these my brethren,” says Jesus—we do to the Lord himself.

It’s a sobering warning, and I fear that I’m typical. For the most part I think about myself: my needs, my interests, my desires. And when I break out of my cocoon of self-interest, it’s usually because I’m thinking about my family or my friends, which is still a kind of self-interest. The poor? Sure, I feel a sense of responsibility, but they’re remote and more hypothetical than real: objects of a thin, distant moral concern that tends to be overwhelmed by the immediate demands of my life. As I said, I’m afraid I’m typical.

That’s why the modern Catholic tradition of social ethics has consistently insisted that the needs of the poor must take priority. In Octogesima Adveniens (1971), an encyclical marking the eightieth anniversary of Leo XIII’s seminal treatment of modern social issues, Rerum Novarum, Paul VI evoked the fundamental importance of a transformative spirit of self-sacrificial love. “In teaching us charity,” he wrote, “the Gospel instructs us in the preferential respect due to the poor and the special situation they have in society: the most fortunate should renounce some of their rights so as to place their goods generously at the service of others.”

“Preferential respect” became the handier slogan “preferential option,” a formulation that first emerged from liberation theologies in South America but has percolated into a great deal of Catholic pronouncement on social ethics in recent decades. It captures a fundamental Christian imperative. When we think about politics and culture, our first question should be: “What are the needs of the poor?”

Today, there is certainly material want in America. People who have lost their jobs can’t pay rent. Unmarried young women who have courageously refused to abort their children struggle to make ends meet. Illegal immigrants are exploited; the homeless need shelter; the hungry, food.

Some say the best way to meet these needs involves adopting tax policies designed to stimulate economic growth, along with redoubled efforts of private charity. Others emphasize public programs and increased government intervention. It’s an argument worth having, of course, and to a great degree our contemporary political debates turn on these issues. But we shouldn’t lose sight of the fact that there is a unifying consensus: The moral character of a nation is measured to a large degree by its concern for the poor.

On this point I agree with many friends on the left who argue that America doesn’t have a proper concern for the poor. Our failure, however, is not merely economic. In fact, it’s not even mostly economic. A visit to the poorest neighborhoods of New York City or the most impoverished towns of rural Iowa immediately reveals poverty more profound and more pervasive than simple material want. Drugs, crime, sexual exploitation, the collapse of marriage—the sheer brutality and ugliness of the lives of many of the poor in America is shocking. As the Catechism of the Catholic Church reminds us, poverty is not only material; it is also moral, cultural, and religious (CCC 2444), and just these sorts of poverty are painfully evident today. Increasing the minimum wage or the earned-income tax credit won’t help alleviate this impoverishment.

We can’t restore a culture of marriage, for example, by spending more money on it. A recent report on marriage in America from the National Marriage Project under the leadership of W. Bradford Wilcox, When Marriage Disappears: The New Middle America, paints a grim picture. The lower you are on the social scale, the more likely you are to be divorced, to cohabit while unmarried, to have more sexual partners, and to commit adultery. One of the most arresting statistics concerns children born out of wedlock. In the late 2000s, among women fifteen to forty-four years old who have dropped out of high school, more than half of those who give birth do so while unmarried. And this is true not only of those at the bottom. Among high-school graduates and women with technical training—in other words, the struggling middle class—nearly half of the women who give birth are unmarried.

A friend of mine who works as a nurse’s aide recently observed that his coworkers careen from personal crisis to personal crisis. As he told me, “Only yesterday I had to hear the complaints of one woman who was fighting with both her husband and her boyfriend.” It’s this atmosphere of personal disintegration and not the drudgery of the job—which is by no means negligible for a nurse’s aide—that he finds demoralizing.

Teachers can tell similar tales. The wife of another friend told me that her middle-school students in a small town in Iowa were perplexed by Hawthorne’s novel The Scarlet Letter: “What’s the big deal about Hester and Reverend Dimmesdale gettin’ it on?” It was a sentiment that she wearily told me was of a piece with the meth labs, malt liquor, teen pregnancies, and a general atmosphere of social collapse.

Preferential option for the poor. A Christian who hopes to follow the teachings of Jesus needs to reckon with a singular fact about American poverty: Its deepest and most debilitating deficits are moral, not financial; the most serious deprivations are cultural, not economic. Many people living at the bottom of American society have cell phones, flat-screen TVs, and some of the other goodies of consumer culture. But their lives are a mess.

And why? It’s a complicated question that I can’t convincingly answer here. But I want to end with a suggestion, if not an argument.

On the question of social justice, Pope John Paul II once wrote, “The needs of the poor take priority over the desires of the rich.” For most of my life (I was born in 1959), the rich and well-educated in America have desired nothing more than the personal freedoms of bohemian liberation. The rich, we must be clear, include the secure and successful academic and professional upper middle classes. I am not talking only about people who live in penthouses, but about people like us and those we know.

This bohemian liberation has involved the sexual revolution, of course, with the consequent weakening of the constraining and disciplining norms of a healthy culture of marriage. But the ways in which the rich have embraced their freedoms hasn’t involved only sex and marriage. It also includes the verbal antinomianism typified by George Carlin’s campaigns to normalize obscenity, suburban librarians insisting on the right to view pornography, tech billionaires who dress like dockworkers, a feminism that mocks the social mores that make women ladies and men gentleman, and many other attacks on older notions of bourgeois respectability.

Here’s a typical story. A few months ago, a Northwestern University psychology professor invited a sex entrepreneur to speak to his class, and the visit concluded with a sexual performance that, as one newspaper discreetly reported, involved “a woman, a man, and an electric-powered device.”

The powers that be squirm a bit when lifestyle revolutionaries frighten the horses and bring bad publicity. Northwestern’s president, Morton Schapiro, put out an anodyne statement: “Many members of the Northwestern community are disturbed by what took place on our campus. So am I.” But elite sentiment remains indulgent, if not positively solicitous. The rhetoric of liberation (“Sexual minorities need to be accepted!”) throws up a smoke screen, and there’s lots of earnest talk about academic freedom. Meanwhile, the rich get their freedoms, which have very little to do with justice and everything to do with marrying wealth and status to the delicious benefits of a diminished conscience. And all this takes place in an environment furnished with the safety nets of therapists, detox clinics, watchful friends, and economic security.

The social reality of contemporary America is painfully clear. By and large, the rich and powerful don’t desire more wealth nearly as much as they desire moral relaxation and the self-complimenting image of themselves as nonconformists living a life of enlightenment and freedom in advance of dull Middle America. Meanwhile, on the South Side of Chicago—and in hardscrabble small towns and decaying tract housing of old suburbs—the rest of America suffers the loss of social capital.

I must admit that I often feel frustrated by my liberal friends who worry so much about income inequality and not at all about moral inequality. Their answer is to give reparations. Are we to palliate with cash—can we palliate with cash—the disorder wrought by Gucci bohemians?

No. Progressives talk about “social responsibility.” It is an apt term, but it surely means husbanding social capital just as much as—indeed, more than—providing financial resources. In our society a preferential option for the poor must rebuild the social capital squandered by rich baby boomers, and that means social conservatism. The bohemian fantasy works against this clear imperative, because it promises us that we can attend to the poor without paying any attention to our own manner of living. Appeals to aid the less fortunate, however urgent, make few demands on our day-to-day lives. We are called to awareness, perhaps, or activism, but not to anything that would cut against the liberations of recent decades and limit our own desires.

Want to help the poor? By all means pay your taxes and give to agencies that provide social services. By all means volunteer in a soup kitchen or help build houses for those who can’t afford them. But you can do much more for the poor by getting married and remaining faithful to your spouse. Have the courage to use old-fashioned words such as chaste and honorable. Put on a tie. Turn off the trashy reality TV shows. Sit down to dinner every night with your family. Stop using expletives as exclamation marks. Go to church or synagogue.

In this and other ways, we can help restore the constraining forms of moral and social discipline that don’t bend to fit the desires of the powerful—forms that offer the poor the best, the most effective and most lasting, way out of poverty. That’s the truest preferential option—and truest form of respect—for the poor.

Agenda — Grinding America Down [VIDEO]


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Source: Agendadocumentary.com

I usually don’t pay much attention to things like this but a friend send the link along and I took a look. I agree with almost everything the speakers said in it. I don’t know if the movie is any good, but the promo sure is.

Source: Agendadocumentary.com


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