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Bernanke: "Recession Very Likely Over"

September 16th 2009 04:54
The Washington Post reports that Federal Reserve Chairman Ben Bernanke commented after a speech on Tuesday that the recession is "very likely over". However, he continued by adding that the job market will remain weak.

The question Bernanke doesn't address, but should be on the minds of every American taxpayer is this: If the recession is over, can we cancel the rest of the "stimulus" plan which is scheduled to be spent in the next 18 months? After all, that $700 BILLION is much better taken off the spending list than to incur the additional debt.


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Posted By: Opher Banarie - Category: Business, Taxes
   


January's Silver Lining

February 12th 2009 19:32
In a surprising show of strength, the results of January's retail sales statistics shows an overall increase of 1 percent, the largest increase in 14 months.

The various "experts" were surprised, but some of this was predictable: Many people who received gift cards for the holidays used them in January. The revenue gets booked in January, even though the cash changed hands in December. Also, many retailers had various sales (some like Circuit City had close-out sales) and these lowered prices also attracted buyers.


Now that the huge stimulus plan has been passed by Congress and a conference committee has agreements on differences between the two Houses, the next few months' statistics will be very important to see if the economy is being "stimulated" or just being battered by poor government policies. (See George F. Will's column for more on this topic.)

Another important matter will be gasoline prices and supply. As the weather warms and more people get on the roads nationally, it is common to see prices rise. Already prices are $.20 to $.25 more per gallon than the lows a month ago. By May will we be treading near last year's $5 prices? Only time will tell.
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Posted By: Opher Banarie - Category: Business, Taxes, Politics
   


Exxon Mobil Does It Again - Take Note

January 30th 2009 19:40
The media reports are loaded with headlines screaming about Exxon Mobil's $45.2 BILLION in profits for calendar 2008. But, as reported here before, that is not the entire story.

In calendar 2008, Exxon Mobil paid a total of $116.3 BILLION in taxes. In other words, for every dollar in profits they paid almost three dollars in tax. That's roughly a 70% tax rate. But the politicians will yell about "obscene" profits and call for a windfall profits tax.

Look at it this way: Exxon Mobil collected $477.4 BILLION in revenue, so their profit was 9.4% for the year. Companies like Microsoft and Google earn more than double that. Why isn't there a call for "windfall profits taxes" on those companies?

This is all political posturing. We should understand that company profits are paid to shareholders - the pension funds and retirement accounts of all Americans. It's more important that political resources be put into national security and not into talking about what companies should or shouldn't be earning.
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GM Gets Billion$; Lays Off Thousands

January 26th 2009 18:32
So, after going to Congress twice for a bailout and being approved for $13.4 BILLION taxpayer dollars, GM today announced that it will lay off 2,000 workers and halt production in several plants for weeks.

GM factory workers who get laid off typically get "sub pay," in which they receive unemployment benefits, and GM pays the difference, up to most of their salary, for 48 weeks.

After unemployment pay runs out, the laid-off workers would go into the jobs bank, where the company pays laid-off workers most of their pay and benefits while trying to find them jobs elsewhere.

Of course, GM is still required to report to Congress with a "viable" business plan on February 17th, but the question must be asked why the company gets to double-dip. If they are getting taxpayer dollars to keep running, why should taxpayers have to pay additional dollars for the unemployment and other benefits of GMs laid off employees? Shouldn't those costs be paid by GM out of the bailout they are receiving? And what about the economic consequences to the communities where GM is closing plants and reducing payroll? Will taxpayers be burdened with those costs, too?

It seems to me that the "trend" toward Socialism is becoming a slippery slope: As more company bailouts turn into "restructuring" including layoffs, the economic impact will be magnified, resulting in more calls for bailouts, etc. The government becomes not only the employer of last resort, but the investor of last resort, and the manager of last resort. The problem is that Congress has proven it cannot manage anything without tossing in a heaping handful of politics and pork-barrel priorities. So, will these bailouts really prove beneficial to the country? Doubtful.
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Posted By: Opher Banarie - Category: Business, Management, Taxes, Politics
   


Obama Names Chief Performance Officer

January 7th 2009 22:49
In keeping with his campaign promise to control Federal spending and to bring greater efficiency to how taxpayer dollars are spent, President-elect Barack Obama today appointed Nancy Killefer as Chief Performance Officer.

"We expect that discussion around entitlements [Social Security and Medicare] will be a part, a central part of those plans," Obama said. "And I would expect that by February in line with the announcement of at least a rough budget outline we will have more to say about how we're going to approach entitlement spending."

For the first time, Obama gave a ballpark price tag for his massive economic plan aimed at generating jobs and jolting the country out of recession. Aides have said it could cost as much as $775 billion over two years. Outside economists have suggested as much as $1.2 trillion would be needed.

Ms. Killefer will be responsible for finding ways to eliminate waste in government spending. Few details were available over how "unnecessary spending" would be identified, let alone how to cut it from the budget.

This will probably be the first test of Obama's pledge to cut spending. The problem with the rhetoric is that all spending exists for a reason - either because of an interested constituency, a motivated member of Congress, or a crusading agency program manager. Getting cuts made will require these people to agree to cuts to programs they wanted and/or created.

Only time will show how effective these efforts will be.

UPDATE: Feb 3, 2009 - In a surprise move, Ms Killefer withdrew her name from the nomination because of undisclosed "tax issues".
Killefer is the third Obama nominee to face tax troubles, following questions about Treasury Secretary Timothy Geithner and former Senate Majority Leader Tom Daschle, Obama's pick for health and human services secretary.
Do you remember Obama promising to make a “new era of responsibility” during the campaign? We didn't know then who his picks would be, since he has never had executive responsibility. But now that names have been offered we can see that the Obama Administration will be a traditional Democratic one. In fact, it could be called Clinton III.
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Posted By: Opher Banarie - Category: Business, Taxes, Politics
   


Windfall Profits Tax on Oil Companies

September 5th 2008 22:24
Barack Obama has called for a windfall profits tax on oil companies after another round of record earnings were reported by the industry. As I mentioned here back in May, the only numbers being reported by the media, and repeated often by politicians of a certain stripe, are the earnings.

Horrors! They made money


[ Click here to read more ]
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Posted By: Opher Banarie - Category: Business, Energy, Taxes, Politics
   




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