A Specific Contrast example of how IRS treated Tax-Exempt Filers

There's so many big stories this week and so little regarding economics and finance, we've been hesitant to really spend much time getting into the fray.

You got the Bengazi situation from last year coming back into focus for at least another week or so, the IRS admitting they targeted both Conservative and Jewish organizations with unfair bias when applying for tax-exempt status, and Associated Press claiming the government seized phone records over a two month period in 2012 in a probe to see how they gather their news in the wake of a CIA operation in Yemen...

Wheww~

The problem with most news like this is that nothing ever comes about..

No prosecutions.. No voluntary resignations.. No impeachments..

There's some hubbub and rigmarole to incite partisan passions and then the weekend rolls around and all everyone is concerned about is Memorial Day weekend preparations and the symbolic beginning of 'summer fun'.

Oh trust us-- we wish and hope any or all of these three situations blow up into a mighty political dust-cloud.. preferably so large it gets into the eyes of and badly stings n' blinds Wall Street.

Of course if the final result of all this is a 'President Joseph Biden', that's not That much for political enemies of the President to celebrate, is it?

If we had to focus on one of the three current stories making the rounds, we'll take on the most dry topic--  IRS.  Always a challenge to see if one can make dry toast taste like a warm buttery croissant..

What makes what the IRS (and whoever instructed them) so evil isn't merely the targeting of groups from a political or religious affiliation, but the combination of stall tactics and deep intrusion via the questioning to make the applying for tax-exempt status as sadistic as possible.

According to the DailyMail UK, one Tea Party group, the Richmond Tea Party was asked 55 questions after more than two years for waiting...  Fifty-Five!

Here's a mere sampling:

3) Provide the following information for all the events and programs you have conducted and participated from October 22,2010 to now (other than the events and programs that are questioned below separately). Please answer the following for each event:

a) The time, location, and detailed description of each event or program

b) Copies of handouts you provided to the audience, participants, and the public

c) The names and credentials of the organizers

d) If speeches or forums were conducted in the event or program, provide detailed contents of the speeches or forums, names of the speakers or panels, and their credentials. If any speakers or panel members were paid, provide the amount were paid for each person. If not, please indicate they volunteered to conduct the event or program.

e) The names of persons from your organization and the amount of time they spent on the event or program. Indicate the name and amount of time they spent on the event or program.  

f)  Indicate the name and amount of compensation that were paid to each person' If no one were paid, indicate this event were conducted by volunteers to each person.  Indicate the percentage of time and resources you spent on all the events and programs in relation to 100% of all your activities.

g) Will your near future events and programs remain similar to those you have been conducting recently? If not, explain the changes of your events and programs in the near future in terms of contents, time, and resources.

Indicate.. Indicate.. Indicate!!

Marsha.. Marsha.. Marsha!!  (Brady Bunch reference there)

Now when President Obama's brother Malik applied for tax exempt status to the Barak H. Obama Foundation, senior IRS official Lois Lerner granted it rather quickly...

How quick?  18 months?  12?   maybe 6?

Nope--  1 month.

Lerner also appears to have broken with the norms of tax-exemption approval by granting retroactive tax-exempt status to Malik Obama’s organization.

From DailyCaller:

"Lerner granted the organization a 501(c) determination and even gave it a retroactive tax exemption dating back to December 2008.

The group’s available paperwork suggests an extremely hurried application and approval process. For example, the group’s 990 filings for 2008 and 2009 were submitted to the IRS on May 30, 2011, and its 2010 filing was submitted on May 23, 2011.

Lerner signed the group’s approval [pdf] on June 26, 2011.

It is illegal to operate for longer than 27 months without an IRS determination and solicit tax-deductible contributions."

The ostensibly Arlington, Va.-based charity was not even registered in Virginia despite the foundation’s website including a donation button that claimed tax-exempt status.

A little background on Abon’go “Roy’ Malik Obama-- He is Barack Obama’s half-brother and was the best man at his wedding, and he has a checkered past. In addition to running his charity, Malikran unsuccessfully to be the governor of Siaya County in Kenya.

He was accused of being a wife beater and seducing the newest of his twelve wives while she was a 17-year-old school girl.

So Lerner approves tax-exempt status for that Foundation in one month and retrogrades it by 36 months, but will ask the Richmond Tea Party this:

10)Are you a membership organization? If so, provide the following for your membership.

a) How many members do you have currently?

b) What does the memberships consist of? Are they mostly individuals? What is the percentage of the organizational members as they are part of the whole membership?

c) Provide member application/registration form

d) Provide membership agreement and rules that governs members.

e) Provide a membership fee schedule.

f) What are the membership requirements?

g) What services and benefits do you provide especially for members only?

h) What are the roles and duties of your members?

i) Provide copies of your website that your members can only access.

In a free society like ours it is truly unacceptable for any group of people to be targeted in this way based on mere ideological opinions.  But in a way its not surprising..

Government is paranoid... So desperately afraid of any force(s) threatening its power.   Remember- you work for its benefit, not it working for yours.

And when the Dept of Homeland Security buys 10s of thousands of automatic weapons and hundreds of thousands of bullets to arm local police, trust us,its not to fight an enemy thousands of miles away.

Like we said, we hope this turns into something Big... We Hope lots of head will roll for this..  Major repercussions...

But we've been burnt so many times..

So for now, we'll just sit back and observe while not being tempted by the enticing possibility of sparks turning into gorgeous wildfire...

And think on happy things..  Like cats and piggies

Economic Profit via Containment rather than Cure

Weekend is just upon us so let's get right into it...

Two big questions always asked around the proverbial water cooler by those who care about the state of the US economy is why doesn't government do anything to improve the situation, and why is this evil stock market continuing to rise.

We've explained the reasons before but sometimes its better to get the truth from a different source..

The truth is.. well, CNBC's headline says it best:

'Markets Don't Want Strong Economy'

Oh Wow.. please explain...

"Stock markets don't want a strong economy, since a resurgence in growth would mean the end of cheap money and heighten worries about inflation , said Bob Doll, chief equity strategist at Nuveen Asset Management."

Re-read that... let it sink in.

The closest thing to genuinely honest, blunt truth you'll read or hear from a mainstream finance news site..  Continuing..

"(Doll says) So many people want a strong economy. Beware of what you ask for... A strong one will bring the questions, 'When is the Fed done? When is inflation coming back? When is the end of the cycle?...

If your objective is to find jobs for our kids, absolutely you want a strong economy," he added. "But if you want a strong stock market, at least in the near term, you want a good but not great economy"...

Uncertainty is causing companies to hold on to cash or return it to shareholders via buybacks and dividends, but Doll noted, "It's not great for the economy, but great for the stock market.""

And that is why Nothing.. and we mean Absolutely Nothing is done to truly improve the US economy.

Our politicians, Dem and Rep are bought off by Wall Street and they do not want Congress or the President to do Anything to cause those QE spigots to even remotely close up.

And as long as there's just a modicum of growth.. some teensy weensy movement in the direction of improvement, people will be overall content.

Remember the example we often use...

You're standing in a very long line for a very long period of time and it seems like its not moving, so it causes feelings of anger and impatience.  When you see the front of the line move a couple inches, it gives hope of eventual continual progress even though the line didn't move way, way back where you're standing.

Just the glimmer of hope and slight improvement is enough to keep most people waiting in that line....

Same with this economy-- show a stock market go up, unemployment figures go down and a populace kept in the dark as to how statistics are manipulated and you have a lot of people struggling with nothing more than mere belief of things getting better as solace.

Its no different than with medical disease and cancer...

Wonder why there is no cure for cancer and AIDS?

There's really no financial motivation to eradicate the menace.  The corporate profits come from the containment.

All those supposed scientists tirelessly working around the clock... The nonstop cocktails of drugs one ingests simply to control their ailments..  The tens of billions of dollars these charities take in based on public's good intentions... All the profit that comes from Oncology and radiation treatments and hospice,etc...

The last disease which was eradicated was polio-- 50-60 years ago or thereabouts.  And why?   How did this happen?  Simple-- Dr Jonas Salk came up with cure then gave it to the medical community for FREE!

And that's why polio in the western world is pretty much non-existent and why scientists currently can't even cure a common cold!

It all comes down to the profit motive.   Zero incentive.

If we were running this nation, we would punish Investors like there was no tomorrow. Dramatically increase their stock dividend taxes and compel state governments to charge sales tax on stock buy/sell transaction.

We'd also actually enact legislation to get people working and punishing businesses that refuse to hire..  Corps would also have to legally provide medical and dental benefits to temp workers, so to force businesses to stop using them as an escape from hiring real employees and providing living wages and benefits for their workforce...

We'd also establish what we call the 'Nike Tax'- so named because we despise that corporation more than any other.  The 'tax' would be 20% on all goods and services provided by American corporations which did not produce at least 20% of all product on US soil.

In other words, if Nike for instance wants to continue selling $150 shoes to US inner-city children, it better hire American men and women to produce 20% of the shoes and apparel it puts its 'Swoosh' onto, or that pair of shoes now will cost $180 -- the 20% going into the greater unemployment fund.

If they didn't like it, we'd close the US market entirely to that corporation.

If we're good enough to buy the shit, we're good enough to make it...

The status quo would not continue..

There's just no motivation for anyone in a position of power to do anything to truly make our lives better or safer, and too few understand this for there to be the proper groundswell public reaction and response

~ Happy Cinco de Mayo (May 5th)