Re: OT Atals Shrugged

Posted by wisbaker on November 10, 2012 at 11:22:50 from (207.118.181.192):

In Reply to: OT Atals Shrugged posted by Bryan iniowa on November 10, 2012 at 06:34:40:

Venture capitalists and vultures? The current situation with venture capitalists is nothing more than a market response to market force barriers WE (our government) put into to place to try to make things "fair". A strong healthy well managed business is not going to tie up with a venture capitalist, they have no need to. Now if a apparently strong healthy business ties up with a venture capitalist it might be for other reasons, like a particularly onerous labor contract has them at a disadvantage against a new upstart competitor and the venture capitalist is going to lean them to be competitive and save jobs or recapture the value of the company for the shareholders (owners)by eliminating obligations of lessor position. These market forces may also be due to governmental regulations.

The largest single taxpayer and employer here in our county was a paper mill way up in the northern part of our county. It had been sold a few times and the last owner was a much a venture capitalist as a mill operator. When they shut it down there were all kinds of cries about the greedy venture capitalist. Yes the plant was making money but the owners of the plant could take the money they had invested in the plant put it in bank CDs and get more money with less risk. In fact they shut this and several other area mills down and shifted the production from these plants to other newer and more efficient mills they owned in states with a more favorable business climate and in doing so their stockholders, many of who are retirees who invested their savings in this company, would get a fair dividend that accurately rewards them for the risk they are taking.

In many cases our tax code has forced smaller family owned businesses out of family control, they were sold to pay taxes or the next generation of the family felt there were better opportunities for them than owning a hardware store, automobile dealer, Implement companies (keeping it tractor related) home town grocery store or what ever the business was.

We want to punish the rich and our tax code is so structured and in many cases it's biased against business owners. When I worked for the county my salary was about $50,000 a year- that's middle class and not really excessive however as a department head I also new the actual cost to the taxpayers for my services after all benefits were paid was $93,000. If my wife earns the same amount and we happened to make it in our business all of a sudden we're the evil rich that must be punished.

Wealth is not created in a vacuum. Let's look at the simple transaction of buying/selling a $20,000 new car. When a new $20,000 car is sold in a state with a 5% sales tax and a .5% local option tax the salesman makes about 1/10 of his monthly sales (on average), the dealer anywhere from 1% to maybe 5% of their monthly sales goal, the state gets $1,000 in sales tax and $100 for tag & title transfer, the county $100. Let's say we pass a new mandate for fuel efficiency or safety and that results in 100 fewer people buying cars that year. The car dealers need one less sales man, the state losses $100,000 in tax revenue (say good bye to a social worker or trooper or snow plow driver) and losses another $1000 in title and tag transfer fees, the county losses $1,000. Because the automaker needs 100 fewer cars 1 1/2 $70,000 a year auto workers aren't needed and so it goes on.

What really is fair?- according to our constitution and our laws we are all supposed to be equal in the eyes of the law or government. I say FAIRNESS is when we take the cost of the government and divide it by the number of people served and that's the tax for the year. If we looked at it that way people would be less inclined to want more from the government if they new it was going to increase their taxes. Is it really "fair" that I pay a percentage of my paycheck (with my employer paying the same amount) in social security and earn the top benefit, yet some one who may of made less than me and paid substantially less into Social security than me may get a benefit of the same value?

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