Oklahoma Republican Tom Coburn - "$30 billion in aid to millionaires is sheer Washington stupidity!"
Wealthy celebrities including Bruce Springsteen, Jon Bon Jovi, Quincy Jones and Ted Turner have received federal subsidies, according to
a new report aptly named Subsidies of the Rich and
Famous, from the office of Oklahoma Republican Senator Tom Coburn.
Senator Tom Coburn explains: "From tax write-offs for gambling losses, vacation homes, and luxury yachts to subsidies for their ranches and estates, the government is subsidizing the lifestyles of the rich and famous. Multi-millionaires are even receiving government checks for not working. This welfare for the well-off -- costing billions of dollars a year -- is being paid for with the taxes of the less fortunate."
Coburn detailed in the study that more than $30 billion a year comes out of the U.S. Treasury to aid people who make more than a million a year.
"The government's social safety net is now being used as a hammock by some millionaires, some who are paying less taxes than average middle class families," Coburn contended.
Among the handouts for the well-heeled are:
- $18.15 million in child care tax credits
- $74 million in unemployment checks
- $89 million for preservation of ranches and estates
- $316 million in farm subsidies
- $608 million in business entertainment deductions
- $9 billion in retirement checks
- $21 billion in gambling losses
- $28 billion in mortgage breaks for mansions, vacation homes and yachts
"Fleecing the taxpayer while contributing nothing is not the American way," he wrote. He also sees policies that help the rich avoid taxes as government-sanctioned redistribution of wealth. "The tragic irony is the wealth in these cases is trickling up rather than down the economic ladder."
The Government Accountability Office (GAO) identified several individuals receiving farm payments
whose professions had nothing to do with farming or agriculture,” says the report. These individuals include real-estate developer
Maurice Wilder,
who is a part-owner of a professional sports franchise in the Tampa Bay/Clearwater area of Florida,
and whose net worth is estimated to be several hundred million dollars,
received a total of more than $200,000 in farm program payments in 2003, 2004, 2005, and
2006.
The report also says millionaires Jon Bon Jovi, Bruce Springsteen and Ted Turner have collected farm subsidies.
These individuals include Scottie Pippen (net
worth: $45 million) and Ted Turner (net
worth: 2.1 billion) Millionaires also receive state tax breaks on farm land. For example, Jon Bon Jovi
(net
worth: $125 million) paid property taxes of only $100 last year on his extensive real estate holdings in New Jersey that he uses to raise bees. At the same time, Bruce Springsteen
(net
worth: $200 million) received farm subsidies because he leases his property to an organic
farmer.
The Full 37-page report is here (PDF)
Grover Norquist's website, Americans for Tax Reform, puts a different slant on this, using the usual Republican scare tactics by implying that ordinary working Americans would somehow be hurt by eliminating these unnecessary "give-a-ways" to the very wealthy. They say, "Senator Tom Coburn wants to take away everyday tax deductions and credits from taxpayers earning more than $1 million per year so that the government can spend that money instead. His plan will eventually grow to include millions of American families."
Did you notice how they say, "Everyday tax deductions for millionaires," as if millionaires were so common that they just hang out on the typical street corner on Friday nights.
But Senator Coburn (who is a millionaire himself) emphasizes that "We should never demonize those who are successful. Nor should we pamper them with unnecessary welfare to create an appearance everyone is benefiting from federal programs."
Among the most egregious offenses of these Reverse Robin Hood handouts (which are much like corporate welfare in the form of subsidies for profitable oil companies) is:
- $16.4 million in subsidized student loans for millionaire college students from 2007 to 2010
- $27.7 billion in mortgage interest deductions for millionaires
- $20.8 million in unemployment benefits paid to millionaires in 2009 (Maybe this is what Senator Jim DeMint meant when he said jobless Americans were gaming the system.)
The U.S. tax laws have been been rigged for millionaires for decades, because half of Congress are millionaires themselves. So I don't understand what millionaires like Bill O'Reilly, Sean Hannity, Eric Cantor, Glenn Beck, Paul Ryan, Herman Cain, Mitt Romney, Newt Gingrich, Rick Santorum, Rupert Murdoch, the Koch bothers, Michele Bachmann, Paul Rand, Nikki Haley, Sarah Palin, Karl Rove, Grover Norquist, and Rush Limbaugh have been whining like spoiled rich brats.
Saying that money and politics go hand in hand would be stating the obvious, but a study released by the Center for Responsive Politics takes it further. In 2009, nearly half of Congress, 261 to be exact, are millionaires, 55 of them boast personal fortunes of more than $10 million, and 8 of them pass the $100 million mark. Only 1% of all Americans have the pleasure of a bank account with more than $1 million.
Now part of the discussion that's going on in the congressional super committee is an overhaul of the tax code that would address issues like the ones brought up in Coburn's report. But so deep is the divide between the two parties over taxes -- Democrats prefer to discuss revenue from millionaires and billionaires, whereas the Republicans just wants cuts to programs that ordinary Americans rely on, such as Social Security and Medicare.
Meanwhile...
...the concentration of wealth into the top 1% has been escalating.
And they're not just your AVERAGE MILLIONAIRES, they're ultra-rich - - they are the ultras, the comfortably ultras, and the super ultras - - The top 1% of the top 1%.
Another financial firm has tallied how much net worth is sloshing in the pockets of the world’s most spectacularly wealthy. So when will the time finally come to stop the counting their money — and when will we start the taxing?
In today’s astoundingly unequal global economy, banks can go either of two routes — or both — to bag ever bigger returns. They can squeeze the 99 percent with nuisance fees and other penalties. Or they can cater to the richest of the rich.
But both routes have bumps. The 99 percent can squeeze back, as they did earlier this month when Americans by the tens of thousands shut down their Bank of America accounts to protest the bank’s $5 debit card greed grab.
And the richest of the rich? To cater to these most fortunate ones, you first have to find them. But that can be difficult. Fortunately, financial industry consulting firms have stepped up to help. These firms have started publishing annual global wealth surveys that pinpoint where banks — and luxury retailers and anyone else who wants in on the top 1 percent action — can find “high” and “ultra high” net-worth individuals.
Last week, a new global firm — the Singapore-based Wealth-X — entered the global wealth survey fray, joining a crowded field that already includes Capgemini and Merrill Lynch, the Boston Consulting Group, Credit Suisse, and Deloitte LLP.
Each of these firms has tried to carve out a unique market niche. The Wealth-X specialty? The world of the ultra rich, those individuals who can claim at least $30 million in net worth. And the researchers at Wealth-X haven’t just counted these ultras in their first annual global wealth census. They’ve tiered them.
For the entire world — and major nations — Wealth-X teases out sub-sets of the super rich, from the $30-to-$50 million set to the $1 billion and up. For the first time, thanks to Wealth-X, we can compare the barely ultra with the comfortably ultra and those super ultras.
“Our report maps exactly where the biggest money is located,” Wealth-X CEO Mykolas Rambus boasted at a Geneva news conference last week, “and just how much there is.”
The Wealth-X research answers “how many” as well. The firm counts 185,795 individuals worldwide with at least $30 million net worth. These ultra high net-worth individuals — UHNWs — hold $25 trillion in combined wealth.
The global economy may be tottering, the new Wealth-X World Ultra Wealth Report 2011 goes on to inform us, but the “lifestyle habits of UHNW individuals have not been severely impacted.“
“Simply put,” the Wealth-X analyst team gushes, “the world’s wealthy elite are in a class of their own.”
In that class, Americans pack a bunch of the rows. Of the near 186,000 global ultra rich, 57,860 — 30 percent — carry U.S. passports. These American ultras hold a combined net worth of $7.6 trillion, an average of $131.4 million each.
That average masks a huge concentration of wealth at America’s summit. The 455 deep-pocketed Americans worth at least $1 billion hold half a trillion more in wealth than the 29,415 Americans in the Wealth-X $30-to-$50 million tier.
These numbers need a bit more context to have any real meaning, and we can take a stab at providing that context by glancing over at the “super committee” deficit-reduction deliberations now underway in Washington, D.C.
The 12 lawmakers on this congressional super committee — six Republicans and six Democrats — are trying to trim $1.2 trillion off federal red ink over the next ten years. On their chopping block: Medicare, Social Security, and assorted other programs essential to the well-being of America’s 99 percent.
The super committee reporting-out deadline comes next week. No one knows how much budget-cutting pain the panel will be recommending. But panel members could actually avoid all that pain — and raise over $1 trillion in new money for investing in America — simply by subjecting all U.S. individual net worth over $30 million to a modest wealth tax.
Our U.S. ultra wealthy, Wealth-X calculates, together hold almost $5.9 trillion over this $30 million threshold. An annual 5 percent wealth tax on this overage would raise over $293 billion a year, or $2.9 trillion over the next decade — more than double the $1.2 trillion the super committee is so desperately looking to find.
The most amazing part of this? America’s ultra rich could easily pay this 5 percent annual wealth tax for the next ten years and remain as rich as ever.
That’s because wealth begets wealth. All those trillions of dollars America’s ultras are currently holding don’t sit under some mattress. The ultra wealthy have those trillions invested in assets that generate short- and long-term returns.
If America’s ultras averaged returns on those investments not that far above 5 percent over the next ten years, they could pay the wealth tax and still end the decade with higher personal net worths than when the decade began.
Back in the 1990s, a public-spirited financial industry superstar — multimillionaire San Francisco money manager Claude Rosenberg — spent a sizeable chunk of his personal fortune campaigning to get a similar message across about the enormous wealth of the wealthy.
Rosenberg’s particular point: America’s fabulously rich could hike their annual contributions to charity by tenfold and still end up with higher personal fortunes. Rosenberg started a research group dedicated to sharing this message and the analysis behind it. He wrote a book and peppered the periodicals that rich people read with op-eds that detailed his group's number crunching.
In the year 2000, Rosenberg’s researchers would document, households with $1 million or more in income could have given $128 billion more to charity than they actually did in fact give, without losing any net worth over the course of the year.
Claude Rosenberg died three years ago at age 80, his message to the super rich essentially totally ignored. The vast increase in charitable giving by the rich he had hoped to inspire never materialized.
The message to the rest of us from Rosenberg’s noble effort?
The excess wealth our ultra wealthy hold, if put to the public good, could change the trajectory of America’s future. The ultra wealthy don’t seem to be willing to do that putting on their own.
With a few tweaks of our tax code, we could do that putting for them.
Under the terms of this summer's debt-ceiling agreement, the 12-member congressional super committee must offer by Nov. 23 a plan to reduce long-range deficits by $1.5 trillion over the next decade...
...but in the end, while taxpayers are giving away subsidies to millionaires, Social Security and Medicare will most likely get the axe...and once again, the ultra-wealthy will escape fair taxation on the backs of the poor.
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"The richest 1 percent have more financial wealth than the bottom 95 percent combined."
The total net worth on the Forbes 400 List marks $1.5 Trillion in 2011
Click here to see what $1 Trillion looks like in cashThe Global Super-Rich Stash: Now $25 Trillion
U.S. Corporations have $2.2 Trillion hoarded away off-shore.
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