Tax Break

Who said tax is boring?

Washington the dream factory

Who were Rodgers and Hammerstein trying to kid?

Last year, the Oscar for Best Actor was awarded to someone who feigned inability to speak coherently. This year, the same award went to someone who chose not to speak. The 2012 Academy Award for Best Supporting Actor went to that prize’s oldest recipient best known for playing a singing sailor whose most memorable line, nearly 50 years ago, was whistling his children to attention that they might greet the evergreen Julie Andrews who tried to con everyone into thinking she was a nun.

I think it was Founding Father Benjamin Franklin who adopted the ancient line “Speak little, do much” and Hollywood appears to finally have caught on. The candidates for US President, on the other hand, have clearly not taken a leaf out of Hollywood’s book and now, in the wake of that Muppet Show cast vying for the Republican Nomination whose “Pin The Tail on The Donkey” approach to corporate tax rates I dealt with in a previous post, President Obama has now weighed in with a load more useless verbage on the subject.

Measured by the higher level of  tax in his proposal – 28%, the relevant bits of the president’s Federal Budget Proposal for 2013 are, by definition, more responsible than those of his competitors. But, other than talking vaguely about a broadening of the tax base to cover the drop from 35% and ensure a fairer, leaner system, he was a bit short on the facts. He wants to close loopholes but, given that there are interest groups jealously guarding every one, he does not say which ones. He wants to encourage manufacturing with a 25% rate but does not note that some of the biggest loopholes are in that sector. He wants to encourage relocation of activities back to the US from abroad and proposes a minimum tax on overseas profits of which he provides no details.

Go on. Admit it. You thought the last President of Chile was a General.

Non Americans (that’s me, folks) find all this lack of detail strange. Among the 34 members of the OECD (the rich nations’ club) the only nation other than the United States to run a pure presidential system is Chile – the French have a hybrid approach that includes a prime minister who has the support of the National Assembly, and everybody else runs some form of parliamentary system.  As such, in countries that still call football football, when the Head of Government comes up with a budget there is usually a fighting chance that, at least most of it, will be passed since, overall, he has the confidence of the parliament. That is what we Old World people understand Heads of Governments are supposed to do. Otherwise we could employ a secretary to announce legislation and save a lot of time,money and teeth whitener.

Not in the US. When President Obama made his Budget proposal it was a request to Congress and there is not the faintest risk of it becoming law – in other words he could join the dream world of the irresponsible opposition even though he is the incumbent. Pure Hollywood.

There are, of course, certain anomolies in the US system. The president has to ask Congress to declare War which makes a lot of sense, considering the amount of expense and gore a silly mistake can cause. BUT, he does have the power to turn out the lights on all of us by messing around with those secret codes in the briefcase always carried by a military man at his side.

Her typing wasn't half bad either

On second thoughts, I think I will keep taking the US president seriously. As much as I value the professional abilities of my secretary, if she had her “finger on the button” I would be nervous every time she went for the remote control to adjust the airconditioning.

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