Tax Breaks for Dummies: A brief tutorial.

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that’s what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. “Because you are all such good customers,” he said, “I’m going to reduce the cost of your daily beer by $20.”Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men – the paying customers? How could they divide the $20 windfall so that everyone would get his ‘fair share?’ They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

“I only got a dollar out of the $20,”declared the sixth man. He pointed To the tenth man,” but he got $10!”

“Yeah, that’s right,” exclaimed the fifth man. “I only saved a dollar, too. It’s unfair that he got ten times more than I!”

“That’s true!!” shouted the seventh man. “Why should he get $10 back When I got only two? The wealthy get all the breaks!”

“Wait a minute,” yelled the first four men in unison. “We didn’t get anything at all. The system exploits the poor!”

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

Attribution: David R. Kamerschen, Ph.D. Professor of Economics University of Georgia

For those who understand, no explanation is needed.

> For those who do not understand, no explanation is possible.

Billionaire Hands Over Homes To Homeless, Japanese Property Mogul Opens Up 3 Multimillion-Dollar Hawaii Homes, But Is He Scheming?

Seems everybody is worried about this man’s motivations.  I say, who cares!  They’re his homes.  If wants to allow homless families to live in them, that’s his business.  So what if he asks them to vacate later down the line. Only in America do people criticize free rent.

Billionaire Hands Over Homes To Homeless, Japanese Property Mogul Opens Up 3 Multimillion-Dollar Hawaii Homes, But Is He Scheming? – CBS News

(AP) Japanese real estate mogul Genshiro Kawamoto handed over three of his many multimillion-dollar homes in Oahu’s priciest neighborhood to homeless and low-income Native Hawaiian families.

Tears ran down Dorie-Ann Kahele’s cheeks Thursday as she accepted the key to a white columned house worth nearly $5 million. Her family will live in the mansion rent-free.

Kawamoto plans to open eight of his 22 Kahala neighborhood homes to needy Hawaiian families. He says they will be able to stay in the homes for up to 10 years.

Kahele, 39, and her five daughters had been living in one small room at a homeless shelter for the past five years.

“What we need to do is appreciate,” said Kahele. “As fast as we got it, it could disappear.”

Kawamoto, whose eyes started welling up when Kahele cried, said he will not charge the families anything to live in the homes. They will, however, have to pay their own utility bills.

The billionaire is one of Japan’s richest men. He said he was embarking on the unusual venture because it made him happy. He also gave each family 10 $100 bills to help them move in.

Native Hawaiians are disproportionately represented among the state’s homeless and working poor.

Kawamoto owns dozens of office buildings in Tokyo and his been buying and selling real estate in Hawaii and California since the 1980s.

He has been criticized for evicting tenants of his rental homes on short notice so he could sell the properties, as in 2002, when he gave hundreds of California tenants 30 days to leave.

Two years later, he served eviction notices to tenants in 27 Oahu rental homes, saying they had to leave within a month. He said he wanted to sell the houses to take advantage of rising prices.

Kawamoto selected the eight low-income families from 3,000 people who wrote him letters last fall after he announced his plan. He has said he tried to pick working, single mothers.

He added it showed more dedication to helping the homeless than just handing out cash.

Kawamoto laughed when asked if he was concerned about losing money on the effort, saying, “This is pocket money for me.”

Kahele became homeless two years ago when her landlord raised her rent from $800 to $1,200, putting the apartment beyond reach of her salary as a customer service representative.

Some neighbors are unhappy with Kawamoto’s plan, saying he is trying to drive down real estate values so he can buy even more homes.

“Everyone’s paying homage to him, but in reality, he’s the problem,” said Mark Blackburn, who lives down the street from Kahale’s new home. “Houses are homes. They’re made to live in; they aren’t investment vehicles.”

In response, Kawamoto said, “The people who don’t want to live near Hawaiians should move.”

Major Food Stamp Scam Uncovered by Feds

Move along people. Nothing to see here. Let’s keep focusing on the funding to keep our troops safe. We don’t have time to worry about the rampant fraud, waste and abuse within our entitlement infrastructure. The welfare state is slow bleeding us to death. But it’s not politically expedient to criticize your core voting blocks.


Major Food Stamp Scam Uncovered by Feds

by Jim Kouri – PUERTO RICO — Thirty-one individuals linked to a $30 million food stamp fraud scheme were arrested here this morning following the culmination of a four-year undercover investigation headed by U.S. Immigration and Customs Enforcement (ICE).

The investigation revealed that several grocery stores and food markets engaged in a fraudulent scheme to provide beneficiaries of the Puerto Rico Nutritional Assistance Program (PRNAP) with cash in lieu of groceries for a fee. The accused business owners would register false grocery sales for the amount requested by the participants and charged them a fee of 25 percent of the requested cash.

Those arrested today included business owners, employees and food program beneficiaries. All conspired to defraud the U.S. government. It is estimated that this scheme cost the U.S. government $30 million.

The PRNAP receives a grant of approximately $1.5 billion per year from the U.S. Department of Agriculture’s Food and Nutrition Service to provide nutritional assistance to low-income families in Puerto Rico.

“We will continue working with our law enforcement partners to shut down schemes like this where criminals profit at the expense of federal assistance programs designed to help those in need,” said Manuel Oyola Torrres, special agent in charge for the ICE Office of Investigations in Puerto Rico. “Those who defraud the federal government will be caught and will be prosecuted.”

The investigation succeeded thanks to the cooperative efforts of the Internal Revenue Service Criminal Investigation Division (IRSCID) and the Federal Bureau of Investigation (FBI).

Biofuels boom raises tough questions

Biofuels boom raises tough questions – Yahoo! News

NEW YORK – America is drunk on ethanol. Farmers in the Midwest are sending billions of bushels of corn to refineries that turn it into billions of gallons of fuel. Automakers in Detroit have already built millions of cars, trucks and SUVs that can run on it, and are committed to making millions more. In Washington, politicians have approved generous subsidies for companies that make ethanol.

And just this week,

President Bush arranged with Brazil’s President Luiz Inacio Lula da Silva for their countries to share ethanol production technology.

Even alternative fuel aficionados are surprised at the nation’s sudden enthusiasm for grain alcohol.

“It’s coming on dramatically; more rapidly than anyone had expected,” said Nathanael Greene, a senior policy analyst at the Natural Resources Defense Council.

You’d think that would be good news, but it actually worries a lot of people.

The problem is, ethanol really isn’t ready for prime time. The only economical way to make ethanol right now is with corn, which means the burgeoning industry is literally eating America’s lunch, not to mention its breakfast and dinner. And though ethanol from corn may have some minor benefits with regard to energy independence, most analysts conclude its environmental benefits are questionable at best.

Proponents acknowledge the drawbacks of corn-based ethanol, but they believe it can help wean America off imported oil the way methadone helps a junkie kick heroin. It may not be ideal, but ethanol could help the country make the necessary and difficult transition to an environmentally and economically sustainable future.

There are many questions about ethanol’s place in America’s energy future. Some are easily answered; others, not so much.

WHAT IS ETHANOL?

Ethanol is moonshine. Hooch. Rotgut. White lightning. That explains why the last time Americans produced it in any appreciable amount was during Prohibition. Today, just like back then, virtually all the ethanol produced in the United States comes from corn that is fermented and then distilled to produce pure grain alcohol.

WILL MY CAR RUN ON IT?

Any car will burn gasoline mixed with a small amount of ethanol. But cars must be equipped with special equipment to burn fuel that is more than about 10 percent ethanol. All three of the major American automakers are already producing flex-fuel cars that can run on either gasoline or E85, a mix of 85 percent ethanol and 15 percent gasoline. Thanks to incentives from the federal government, they have committed to having half the cars they produce run on either E85 or biodiesel by 2012.

HOW FAST IS ETHANOL PRODUCTION GROWING?

About as fast as farmers can grow the corn to make it. According to the Renewable Fuels Association, a trade group, ethanol production has doubled in the past three years, reaching nearly 5 billion gallons in 2006. With 113 ethanol plants currently operating and 78 more under construction, the country’s ethanol output is expected to double again in less than two years.

IS ETHANOL BETTER THAN GASOLINE?

For all the environmental and economic troubles it causes, gasoline turns out to be a remarkably efficient automobile fuel. The energy required to pump crude out of the ground, refine it and transport it from oil well to gas tank is about 6 percent of the energy in the gasoline itself.

Ethanol is much less efficient, especially when it is made from corn. Just growing corn requires expending energy — plowing, planting, fertilizing and harvesting all require machinery that burns fossil fuel. Modern agriculture relies on large amounts of fertilizer and pesticides, both of which are produced by methods that consume fossil fuels. Then there’s the cost of transporting the corn to an ethanol plant, where the fermentation and distillation processes consume yet more energy. Finally, there’s the cost of transporting the fuel to filling stations. And because ethanol is more corrosive than gasoline, it can’t be pumped through relatively efficient pipelines, but must be transported by rail or tanker truck.

In the end, even the most generous analysts estimate that it takes the energy equivalent of three gallons of ethanol to make four gallons of the stuff. Some even argue that it takes more energy to produce ethanol from corn than you get out of it, but most agricultural economists think that’s a stretch.

BUT AREN’T THERE ENVIRONMENTAL BENEFITS TO ETHANOL?

If you make ethanol from corn, the environmental benefits are limited. When you consider the greenhouse gases that are released in the growing and refining process, corn-based ethanol is only slightly better with regard to global warming than gasoline. Growing corn also requires the use of pesticides and fertilizers that cause soil and water pollution.

The environmental benefit of corn-based ethanol is felt mostly around the tailpipe. When blended into gasoline in small amounts, ethanol causes the fuel to generate less smog-producing carbon monoxide. That has made it popular in smoggy cities like Los Angeles.

WHAT ABOUT ETHANOL’S ECONOMIC BENEFITS?

Making ethanol is so profitable, thanks to government subsidies and continued high oil prices, that plants are proliferating throughout the Corn Belt. Iowa, the nation’s top corn-producing state, is projected to have so many ethanol plants by 2008 it could easily find itself importing corn in order to feed them.

But that depends on the Invisible Hand. Making ethanol is profitable when oil is costly and corn is cheap. And the 51 cent-a-gallon federal subsidy doesn’t hurt. But oil prices are off from last year’s peaks and corn has doubled in price over the past year, from about $2 to $4 a bushel, thanks mostly to demand from ethanol producers.

High corn prices are causing social unrest in Mexico, where the government has tried to mollify angry consumers by slapping price controls on tortillas. Lester R. Brown, president of the Earth Policy Institute, predicts food riots in other major corn-importing countries if something isn’t done.

U.S. consumers will soon feel the effects of high corn prices as well, if they haven’t already, because virtually everything Americans put in their mouths starts as corn. There’s corn flakes, corn chips, corn nuts, and hundreds of other processed foods that don’t even have the word corn in them. There’s corn in the occasional pint of beer and shot of whisky. And don’t forget high fructose corn syrup, a sweetener that is added to soft drinks, baked goods, candy and a lot of things that aren’t even sweet.

Some freaks even eat it off the cob.

It’s true that animals eat more than half of the corn produced in America; guess who eats them? On Friday the Agriculture Department announced that beef, pork and chicken will soon cost consumers more thanks to the demand of ethanol for corn.

It’s also true that there’s a difference between edible sweet corn and the feed corn that’s used for ethanol production. But because farmers try to grow the most profitable crop they can, higher prices for feed corn tend to discourage the production of sweet corn. That decreases its supply, driving the price of sweet corn up, too.

In fact, many agricultural economists believe rising demand for feed corn has squeezed the supply — and boosted the price — of not just sweet corn but also wheat, soybeans and several other crops.

America’s appetite for corn is enormous. But Americans consume so much gasoline that all the corn in the world couldn’t make enough ethanol to slake the nation’s lust for transportation fuels. Last year ethanol production used 12 percent of the U.S. corn harvest, but it replaced only 2.8 percent of the nation’s gasoline consumption.

“If we were to adopt automobile fuel efficiency standards to increase efficiency by 20 percent, that would contribute as much as converting the entire U.S. grain harvest into ethanol,” Brown said.

ISN’T THERE A BETTER RENEWABLE FUEL SUBSTITUTE FOR GASOLINE?

Most experts think it will take an array of renewable energy technologies to replace fossil fuels. Ethanol’s main drawbacks come not from the nature of the fuel itself, but from the fact that it is made using a critical component of the world’s food supply. Ethanol would be more beneficial both environmentally and economically if scientists could figure out how to make it from a nonfood plant that could be grown without the need for fertilizers, pesticides and other inputs. Researchers are currently working on methods to do just that, making ethanol from the cellulose in a wide variety of plants, including poplar trees, switchgrass and cornstalks.

But plant cellulose is more difficult to break down than the starch in corn kernels. That’s why people eat corn instead of grass. Plus it tastes better.

There are also technical hurdles related to separating, digesting and fermenting the cellulose fiber. Though it can be done, making ethanol from cellulose-rich material costs at least twice as much as making it from corn.

HOW LONG WILL IT TAKE BEFORE CELLULOSIC ETHANOL IS COMPETITIVE WITH CORN ETHANOL AND GASOLINE?

Some experts estimate that it will take 10 to 15 years before cellulosic ethanol becomes competitive. But Mitch Mandich, CEO of Range Fuels, thinks it will be a lot sooner than that. The Colorado-based company has started building a cellulosic ethanol plant in Georgia that converts wood chips and other waste left behind by the forest products industry. Another company, Iogen Corp., has been producing cellulosic ethanol from wheat, oat and barley straw for several years at a demonstration plant in Ottawa, Canada.

HOW MUCH MORE EFFICIENT WOULD CELLULOSIC ETHANOL BE COMPARED TO CORN ETHANOL?

Studies suggest that cellulosic ethanol could yield at least four to six times the energy expended to produce it. It would also produce less greenhouse gas emissions than corn-based ethanol because much of the energy needed to refine it could come not from fossil fuels, but from burning other chemical components of the very same plants that contained the cellulose.

HOW MUCH GASOLINE COULD CELLULOSIC ETHANOL REPLACE?

The U.S.

Department of Energy estimates that the United States could produce more than a billion tons of cellulosic material annually for ethanol production, from switchgrass grown on marginal agricultural lands to wood chips and other waste produced by the timber industry. In theory, that material could produce enough ethanol to substitute for about 30 percent of the country’s oil consumption.

A University of Tennessee study released in November reached similar conclusions. As much as 100 million acres of land would have to be dedicated to energy crops in order to reach the goal of substituting renewable biofuels for 25 percent of the nation’s fuel consumption by 2025, the report estimated. That would be a significant fraction of the nation’s 800 million acres of cultivable land, the study’s authors said, but not enough to cause disruptions in agricultural markets.

“There really aren’t any losers,” said University of Tennessee agricultural economist Burton English.

REALLY? NO LOSERS AT ALL?

There might be losers. Simple economics dictates that if farmers find it more profitable to grow switchgrass rather than corn, soy or cotton, the price of those commodities is bound to rise in response to falling supply.

“You can produce a lot of ethanol from cellulose without competing with food,” said Wallace Tyner, an agricultural economist at Purdue University. “But if you want to get half your fuel supply from it you will compete with food agriculture.”

There may also be ecological impacts. The government currently pays farmers not to farm about 35 million acres of conservation land, mostly in the Midwest. Those fallow tracts provide valuable habitat for wildlife, especially birds. Though switchgrass is a good home for most birds, if it became profitable to grow it or another energy crop on conservation land some species could decline.

WILL ETHANOL SOLVE ALL OF OUR PROBLEMS?

Ethanol is certainly a valuable tool in our efforts to address the economic and environmental problems associated with fossil fuels. But even the most optimistic projections suggest it can only replace a fraction of the 140 billion gallons of gasoline that Americans consume every year. It will take a mix of technologies to achieve energy independence and reduce the country’s production of greenhouse gases.

“I think we’re in a very interesting era. We are recognizing a problem and we are finding lots of potential solutions,” said David Tilman, an ecologist at the University of Minnesota.

But if we’re serious about achieving energy independence and mitigating global warming, Tilman and other experts said, one of those solutions must be energy conservation.

That means doubling the fuel economy of our automobiles, expanding mass transit and decreasing the amount of energy it takes to light, heat and cool our buildings. Without such measures, ethanol and other innovations will make little more than a dent in the nation’s fossil fuel consumption.

Bush, Chavez duel on rival Latin America tours

OK, tell you what we’ll do Hugo.  We’ll cancel your Citgo contract with DoD, your largest non-domestic client.  Nice way to talk out of both sides of your mouth you hypocritical SOB!

Bush, Chavez duel on rival Latin America tours | Top News | Reuters.com

MONTEVIDEO (Reuters) – President Bush and his left-wing nemesis Venezuelan President Hugo Chavez squared off on dueling tours of Latin America on Friday as they vied for the region’s hearts and minds.

The ideological rivalry intensified as Bush arrived in Uruguay, the second stop of his tour, while Chavez drew support from thousands of Argentines at an “anti-imperialist” rally across the River Plate in neighboring Argentina.

Chavez led the crowd of union workers and leftists in shouting “Gringo, Go Home!” against Bush.

Bush is on a five-nation tour that began in Brazil and is aimed at improving his standing in Latin America, where the Iraq war and U.S. trade and immigration policies are deeply unpopular.

Chavez, an ally of communist Cuban leader Fidel Castro, has led a growing anti-U.S. bloc in recent years and rarely misses a chance to rail against American “imperialism”.

Thousands of Uruguayans took to the streets on Friday, some shouting “Get out, Bush!”. Dozens of masked protesters, many wielding sticks and hurling rocks, shattered the windows of three McDonald’s stores.

Taylor Hicks Tickets: $140 !!!

The ‘American Idol” effect in play when it comes to concert tickets…

As if all the fever surrounding Idol Antonella Barba wasn’t enough to make your head explode…Now this!!

My wife was checking out shows coming to the area this summer. Lawn tickets for Taylor Hicks are $140. For LAWN!!

So, by the time you pay to park, you’re down $300 a couple to listen to Taylor frickin Hicks. That’s a car payment and I haven’t had a beer, yet. We surfed around and other acts who have actually sold some records and won some Grammy awards are similarly priced. But what happened to the day when you could see a second tier act at a reasonable price? Last summer we saw Craig Morgan for $16 a piece. And he actually had a couple top ten songs at the time.

I remember as a teen going to the first Monsters of Rock Tour. Kingdom Come, Poison, Scorpions, Metallica and Van Hagar for $35.

This summer I took my daughter to the Virgin Mobile Tour. The Killers, The Racontuers, Gnarls Barkley, The Who and Red Hot Chili Peppers for $100.

So here’s what I’m trying to wrap my head around….

For $135 I saw:

Kingdom Come, Poison, Scorpions, Metallica, Van Hagar, The Killers, The Racontuers, Gnarls Barkley, The Who and Red Hot Chili Peppers…A ten band line-up with who knows how many albums sold and Grammy Awards.

For another $5 or $140, I could see…

Taylor Hicks.

I don’t think so.

Companies to pull ads from Coulter’s Web site

Isn’t the power of the purse wonderful?  I fully support  the DailyKos.com in their efforts to hit Coulter where it counts.  And I encourage all my fellow conservative bloggers to bookmark this post.  You’ll be needing it in the month’s to come as we identify advertisers on ‘extreme political websites’.
Companies to pull ads from Coulter’s Web site – CNN.com

WASHINGTON (CNN) — At least three major companies want their ads pulled from Ann Coulter’s Web site, following customer complaints about the right-wing commentator referring to Democratic presidential candidate John Edwards as a “faggot.”

Verizon, Sallie Mae and Georgia-based NetBank each said they didn’t know their ads were on AnnCoulter.com until they received the complaints.

A diarist at the liberal blog DailyKos.com posted contact information for dozens of companies with ads on Coulter’s site after the commentator made her remarks about Edwards at the Conservative Political Action Conference in Washington on Friday. (Full story)

“One of the best ways to communicate one’s distaste for Coulter’s repeated incidents of hate speech is to respectfully but firmly let her advertisers know you are deeply troubled by their indirect support of bigotry through their advertising on Coulter’s Web site,” the blogger VolvoDrivingLiberal wrote on DailyKos.com on Sunday.

Verizon, Sallie Mae and NetBank said the ads were put on a variety of sites by a third party company. In many cases, advertisers do not know which sites feature their ads.

“Per our policy, the networked Web site ad purchases are supposed to be stripped of certain kinds of Web sites,” said a Verizon spokesperson. “This one could be considered an extreme political Web site, should be off the list, and now it is off the list.”

A Sallie Mae spokesperson said the company was only testing an online advertising agency, and that their ads were not meant to show up on Coulter’s site. The company said they planned to pull ads from other political and religious Web sites as well.

A spokesperson for NetBank said Coulter’s page “is not the kind of site we want to be on.”

Coulter did not respond to CNN’s request for comment.

CNN’s Eric Weisbrod contributed to this report.