The world is full of clubs. Two countries have about 95% of the estimated nuclear weapons in the small club of nuclear countries. The world's four wealthiest countries have about half the global economy.
America is full of clubs. There's the banking club, a rarified group that, while falling far short of Ayn Rand's vision of determining the effective use of capital, has mastered the art of generating bubbles, watching them burst and profiting on both ends. Membership benefits include reaching into current and future tax payer pockets to pay club members millions and to dictate legislation allowing members to continue their cycle of bubble creation and self-enrichment without constraints. Members firmly believe that government should have as little role as possible, unless members are at the brink of gambling themselves out of business. In these desperate times, members are allowed to order Congress to deliver billions of taxpayer dollars to their doorstep in unmarked bills. Non-bankers would love to make millions in bonuses and, when they do a completely incompetent job, force taxpayers to save their companies and even give them even more money for their bonuses, but, alas non-bankers aren't in this club.
There's the hedge fund manager club. Membership benefits include collusion on pricing, tremendous financial benefits for risking other people's money while often providing returns that are less than a simple market index and having a wonderful tax loophole that allows them to pay the capital gains tax rate for much of their income. Club members insist that the capital gains tax should be as low as possible to stimulate the economy ignoring the fact that the trickle-down theory has been ridiculed by serious economists on all sides of the political fence. Ordinary tax payers would love to pay the capital gains tax rate for their regular income, but alas ordinary tax payers aren't in this club.
Last for today, I'll mention the politicians club. Members spend their time raising money so they can run for office. Once elected, they spend their time granting favors to donors while campaigning for reelection. Doing their actual job, such as crafting, reviewing and debating legislation is optional. A prominent member of this club, Congressman Rangel, is in the news these days. Congressmen Rangel was the chairman of the House Ways and Means Committee which calls itself, "the chief tax-writing committee in the House of Representatives". His experience on this committee undoubtedly makes him an expert on tax law. So why did he make such terrible mistakes on his taxes like not reporting significant income...perhaps because as a club member he assumed skipping taxes was part of the privileges. Congressman Rangel has 4 rent stabilized apartments. In New York, people search desperately for rent stabilized apartments in the hopes of finding a place that is affordable. How is it possible for Congressman Rangel to have 4 rent stabilized apartments? Apparently it's a club membership benefit as well.
I would like to believe that in America there is some level of fairness and equity. This is my idealism which bucks up against my real world experiences. I would like to believe that America will wake up to the scam that was and is still being pulled over them concerning the banking industry behavior, the latest financial crisis (versus the S&L Crisis, Asian Crash, Dot Com Crash or other "once in a lifetime crash" that occurs on a regular basis) and the joke of financial reform. I would like to believe that hedge fund managers will pay taxes like those who work jobs that pay more typical salaries. I would like to believe that Charlie Rangel will experience the same justice that I would receive if I had committed the same alleged frauds.
If I could ask Congressman Rangel one single question, it probably wouldn't be about his alleged frauds. I probably wouldn't ask how we can create a fairer and more equitable America. I probably wouldn't ask how I can join one of these elite clubs. I'd probably just ask him if I can move into one of his 4 rent stabilized apartment.
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