Socialism Is Great . . .

I was going to start off with a rant about the budget submitted by President Obama, but it was making my blood pressure rise a bit too much.

Instead let's begin with a nice story about our day yesterday. It was I like to call meeting hell. We had a quick chance to peak at the market in the morning but then it was off to the salt mines to prepare for hours of fun. We have these things called quarterly board meetings. They are great fun.

As my buddy Ben has moved the God forsaken backlands of South Carolina it was good to see him at our Board Meeting. Below is a picture of his house.

He told me he saw three cars in the neighborhood. I asked if he meant when he left and he said, "No three cars since you left last October. Actually it was two cars as I have seen one twice." Ben has been working away so the move has not been to much of a culture shock. (He did keep murmuring something about fried food, frozen fish, and mushy vegetables?)

After our long day in meeting hell, I took Ben, Ellen, Devin, and Jack to Hannah's. It was like returning to a hometown with a war hero. Hundreds of the servers came to give him hugs and welcomes. Ok maybe not hundreds. It made me want to go to some far exotic land (Ok Pickens SC might not be exotic.). Several of the servers explained to Ben that my other attempts at Bromance were not going well and they missed our weekly guys night out. David Hannah is thinking about recasting his 2012 budget if I don't start dating someone on Wednesday nights.

It was a great night and I had the fortune to go home and work with Jack on some over due homework. Ryan our son in law helped build a template for movie reviews and jack had to execute them. We wrapped up at 11:37PM. (If you were wondering why we did not post last night.)

We have big plans for Valentine's tonight. I cannot tell you about them now as it is a surprise, a really cool surprise. Wait till we tell you tomorrow.

We also received the new Roping Dummies CD yesterday. Devin's brother Don Miller has finished recording and releasing this work of art, his second CD in his long musical career. Please follow the link on the right to find out more about the Roping Dummies. If I had to name it, I would say, Grandson's Of The Pioneers. Emulating one of the oldest lasting musical groups in music history, the SOPs, the Roping Dummies do just to the early sound of original Western Music as defined by one guy named Leonard Sly. (Extra points if anybody-Except Don-who can tell me what he changed his name to?). Check out the group and buy the CD on iTunes.

Can't wait to tell how tonight goes so let's get into the market stuff

"Socialism is great, until you run out of rich people."

That was said by one Margaret Thatcher, former PM of The UK. These are words to heed in light of the recent round of budget proposals coming out of Washington. The White Houses Budget
 (yes you can click on the link to see the complete 256 page documents if you'd like. I know most of you won't because it is only about 25% of where your gross income goes, but if you want to play along and keep me honest, please do.) has even by their own bipartisan committee many convolutions and out right misrepresentations of data.

Here is a quick summary, and please keep me honest by double and triple checking.

Federal spending will increase by 227 Billion between now and the end of 2013 and ads 329 billion to the deficit over the same period. Now when you are 15 trillion or so in debt, what's another 300 billion. Lunch Money I guess. (Tell that to the fold in Athen's who are burning the city in the ground over 115 billion dollars.)

There is another 315 billion in stimulus spending (perhaps more great solar deals) even as the President is saying the economy is on the mend, but let's buy some more votes.

Now the CBO (Congressional Budget Office) where people who actually know something about fiscal responsibility are saying the baseline sustainability for the budget is 2.7 trillion less than the number published in this proposal. Let's put that in people speak. Let's say I run a company generating one million a year in revenue. My cost to provide my family and myself an sustainable income is $800,000 leaving 200,000 in gross profit before taxes. If my company is USGOV Co, according to the propose budget, I could increase my expenses to 1.38 million, generating a $380,000 loss in the first year. That is assuming I do not increase my revenue.

Now there are some "cuts' proposed. In his speech the budget is cutting 360 billion in financial reforms to his own health care program. Ok, the WSJ, IBD, Barron's, The Post and many other people much brighter than I have gleaned this document and can only find 23 Billion over the next 10 years in entitlement cuts.

So let's raise revenue. Yeah let's have more taxes. First let's tax those nasty oil companies some more because they are not smart enough to raise the price of their product to Joe Six Pack. That won't hurt the middle class, only us greedy nasty terrible 1 percenters because watching gas goes from $4.29 to $5.50 gallon will just kills us. Joe won't miss the 20.00 a week going into his car. Oh yeah let's raise the taxes on dividends currently at 15%. Now a dividend is money's a company has earned and paid taxes on and has chosen to distributes excess profits and cash to investors (including those 99%s who have 401 Ks and IRA) who have taken either retirement money not taxed yet or net earnings that have been taxed and tax them again. Oh yeah if you are blessed to make more than 250,000 dollars a year you will have a 3-4% higher income and if you are really lucky to have an adjusted gross income of more than 1,000,000 a year, you may see a 7-9% increase. That won't hurt economic growth at all. And I know that charitable donations will continue to recover with a top line income hit like that.

Now the big confusion, and let's give President Obama a little wiggle room here because it is a lengthy document, took place during his message where he said, he inherited a 1.3 trillion dollar deficit. (That is correct, we had a couple of wars, a thing called homeland security and a couple of hurricanes) and that deficit will grow to 8 trillion over the next 10 years. Great sound byte. Unfortunately, according the collective wisdom noted above, has no merit. At the highest estimates, it might grow to 3 trillion. But what is 5 trillion between friends.

I will stop now as my bp is slowly rising, but let me leave you with one more factoid about the Buffet Rule which proposes to tax the top one percent of income earners a special tax because the folk lore is they pay less than all other income categories. According to the CBO the last reliable figures (2007) show that the top 1% of earners paid 18.8% in total taxes compared to 4.2% of "middle income" earners. At the federal level the top 1% paid 30% compared to 15.1% for the average middle income American. But the kicker is, if you taxed the top 1% of earners 5% more, it would only generate 97 billion dollars a year. Boys And Girls, we are looking to resolve a 15 trillion dollar deficit.