Monthly Archives: January 2013

Taxes on Obama Cronies

Obama’s Cronies Shield Themselves From His Higher 2013 Tax on Dividends

By Donald Lambro – TownHall.Com – 12/12/2012

WASHINGTON – Did you see the story about Costco borrowing $3.5 billion to pay a special $7 a share dividend to its stockholders before year’s end to avoid being 2012-12-04T182631Z_1_CBRE8B31F8E00_RTROPTP_3_USAhit by President Obama’s higher tax on investors?

What makes this story especially juicy is that it reveals how Obama’s fat cat supporters, who bankrolled his bid for a second term and embraced his proposed tax increases, have taken steps to shield themselves from the president’s “tax the rich” fiscal folly.

The tax avoidance maneuver, which Forbes magazine calls “a six-year advance on the company’s current annual dividend of $1.10 per share”, will be a windfall for Costco’s richest investors if the tax on their dividends is raised, as Obama has sought to do over the past four years.

One of the people who will benefit from this deal will be Costco’s co-founder and former CEO Jim Sinegal who owns more than two million shares of its stock and will collect about $14.4 million from the special dividend. Had he taken that next year, he could be slapped with a tax rate of 43.4 percent if Obama’s proposed tax increases become law (boosting the tax rate on dividends to over 20 percent and adding a surcharge tax on millionaires).

Instead, Costco decided to pay its stockholders before Dec. 18 so that the special payoff plus a regular quarterly cash dividend of 27.5 cents will be taxed at the current 15 percent rate under the investment tax cuts wisely enacted under President George W. Bush in 2003.

This means Sinegal, who gave a prime-time speech in behalf of Obama’s re-election at this summer’s Democratic national convention, would avoid paying about $4 million in higher taxes next year.

Costco is not alone in its early tax-avoidance payouts. Many American businesses, from Wynn Resorts to Tyson Foods, have also declared special dividends to avoid the higher tax rate if the Bush rates expire.

One of the most notable Fortune 500 companies to join the pack is the Washington Post who endorsed Obama for a second term and has warmly embraced his tax increase plans. The media conglomerate has announced it will pay its 2013 dividends “before the end of this year to try to spare investors from anticipated tax increases,” reports the Associated Press.

Among those who stand to benefit from the Post’s beat-the-tax-deadline — and pocket a bundle of money — will be stock tycoon Warren Buffet and his Berkshire Hathaway firm, the newspaper’s biggest shareholder. Continue reading

HIV

“About 47,000 new diagnoses of HIV made each year, with a lifetime cost for each person conservatively estimated at $379,668.”  Kurt Williamsenimages

“There are also 19 million new infections of sexually transmitted gonorrhea, Chlamydia, and syphilis yearly, which cost $17 billion to treat each year.”  Ibid.

“The World Health Organization says that there ‘are more than 30 different sexually transmissible bacteria, viruses and parasites.’ Treatment for those in the United States is also in the billions of dollars per year—when they’re treatable and not drug resistant.”  Ibid.

The High Cost of “Hooking Up”

By Kurt Williamsen, The New American, January 7, 2013, p. 11

Hydeia Broadbent became somewhat of a mini-celebrity 20 years ago as a seven-year-old when she appeared on a Nickelodeon AIDS special. She appeared on the show with basketball great and HIV-positive athlete Magic Johnson — she had been diagnosed with AIDS, basically believed at the time to be a death sentence. She is still alive, and is a public-speaking dynamo. As an early recipient of anti-viral treatments that made AIDS a livable disease, one might expect her to be one of the many who reiterate their positive experienceshaving the disease, also inadvertently pooh-poohing the seriousness of the disease. Continue reading

Dishonest Educators

By Walter E. Williams, Townhall.Com, January 1, 2013

Nearly two years ago, U.S. News & World Report came out with a story titled “Educators Implicated in Atlanta Cheating Scandal.” It reported that “for 10 years, 2012-09-13T142735Z_1_CBRE88C146C00_RTROPTP_3_SLOVAKIAhundreds of Atlanta public school teachers and principals changed answers on state tests in one of the largest cheating scandals in U.S. history.” More than three-quarters of the 56 Atlanta schools investigated had cheated on the National Assessment of Educational Progress test, sometimes called the national report card. Cheating orders came from school administrators and included brazen acts such as teachers reading answers aloud during the test and erasing incorrect answers. One teacher told a colleague, “I had to give your kids, or your students, the answers because they’re dumb as hell.” Atlanta’s not alone. There have been investigations, reports and charges of teacher-assisted cheating in other cities, such as Philadelphia, Houston, New York, Detroit, Baltimore, Los Angeles and Washington.

Recently, The Atlanta Journal-Constitution’s blog carried a story titled “A new cheating scandal: Aspiring teachers hiring ringers.” According to the story, for at least 15 years, teachers in Arkansas, Mississippi and Tennessee paid Clarence Mumford, who’s now under indictment, between $1,500 and $3,000 to send someone else to take their Praxis exam, which is used for K-12 teacher certification in 40 states. Sandra Stotsky, an education professor at the University of Arkansas, said, “(Praxis I) is an easy test for anyone who has completed high school but has nothing to do with college-level ability or scores.” She added, “The test is far too undemanding for a prospective teacher. … The fact that these people hired somebody to take an easy test of their skills suggests that these prospective teachers were probably so academically weak it is questionable whether they would have been suitable teachers.”

Here’s a practice Praxis I math question: Which of the following is equal to a quarter-million — 40,000, 250,000, 2,500,000, 1/4,000,000 or 4/1,000,000? The test taker is asked to click on the correct answer. A practice writing skills question is to identify the error in the following sentence: “The club members agreed that each would contribute ten days of voluntary work annually each year at the local hospital.” The test taker is supposed to point out that “annually each year” is redundant.

CNN broke this cheating story last July, but the story hasn’t gotten much national press since then. In an article for NewsBusters, titled “Months-Old, Three-State Teacher Certification Test Cheating Scandal Gets Major AP Story — on a Slow News Weekend” (11/25/12), Tom Blumer quotes speculation by the blog “educationrealist”: “I will be extremely surprised if it does not turn out that most if not all of the teachers who bought themselves a test grade are black. (I am also betting that the actual testers are white, but am not as certain. It just seems that if black people were taking the test and guaranteeing passage, the fees would be higher.)”

There’s some basis in fact for the speculation that it’s mostly black teachers buying grades, and that includes former Steelers wide receiver Cedrick Wilson, who’s been indicted for fraud. According to a study titled “Differences in Passing Rates on Praxis I Tests by Race/Ethnicity Group” (March 2011), the percentages of blacks who passed the Praxis I reading, writing and mathematics tests on their first try were 41, 44 and 37, respectively. For white test takers, the respective percentages were 82, 80 and 78.

This test-taking fraud is merely the tip of a much larger iceberg. It highlights the educational fraud being perpetrated on blacks during their K-12 education. Four or five years of college — even majoring in education, an undemanding subject — cannot make up for those 13 years of rotten education. Then they’re given a college degree that is fraudulent, seeing as some have difficulty passing a test that shouldn’t be challenging to even a 12th-grader. Here’s my question: If they manage to get through the mockery of teacher certification, at what schools do you think they will teach?

Dr. Williams serves on the faculty of George Mason University as John M. Olin Distinguished Professor of Economics and is the author of ‘Race and Economics: How Much Can Be Blamed on Discrimination?’ and ‘Up from the Projects: An Autobiography.’