A Visual Guide to the Financial Crisis:The Bailout

Where are they going to go? Mexico? Africa? Canada and Europe already have higher taxes than US. If a wealthy person wants to live in the third world to get a tax break than so be it, no doubt their income was already largely sheltered from the government anyways.

And can we do away with this “the wealthy are themost taxed myth”. Just ask Warren Buffet, his tax rate was %17.7 last year. I was taxed at a higher rate working in a sewing machine factory. Most CEO’s are taxed at a lower rate than their secretaries. So if they want to indulge in some capital flight fantasy, then good riddance, it’s not like they are the ones driving innovation anyways.

Wow, congratulations, you came up with the novel idea of taking money from the “evil” rich people and corporations.

I’m done with you guys.

My humble opinion:

It’s the fault of fractional-reserve banking. Banks are allowed to create loans against money they take in as deposits. It encourages credit but creates “artificial” money. The real money is in the bank’s vaults but then loans are created for every 9 out of 10 dollars deposited out of thin air. Banks have been given this right and it’s great for furthering economic growth but since it’s a bubble by nature, there exists a risk of collapse.

I think eliminating fractional-reserve banking is the answer. It would make money much more expensive and commerce would grind to a halt. But, the value of our money would be incredibly stable and bubble-bursting proof. Banks would only be loaning money they had from their profits so they are the only ones who could lose. Peoples’ money would be safely in vaults where, even if the bank fails, the money could be retrieved.

Great analysis, but the solution appears flawed. The rich already carry this country with the taxes they pay. How will continuing to screw them help? Soon we will not have any more rich, either because we have taken all their money or because they have left the country. Why would someone stay in American when they can keep, spend and pass on the money they make in other countries?

And with the number of layoffs, buyouts, bankruptcies, and bailouts happening today, do you really think taxing corporations and industries will fix anything? All you are doing is increasing unemployment. Their fare share comes from employing people who pay income tax.

Exactly, David.

One of the many ironies this diagram displays is the elimination of overseas tax havens…

…yeahhh.

That is the worst plan ever. You can take your socialist policies and shove it up your ass.

That kids is what we call socialism. Lets take money from people who work hard to get a good education and make a lot of money and give it to those who sit on their @$$es all day. The whole recession is being blamed on corporations, and yes they do deserve some blame, but the housing meltdown is due to Americans who aren’t fiscally responsible an took out mortgages they cant pay back. One of the biggest sources of revenue on here is to tax corporations more: What happens when you tax a company more? I can tell you one thing for sure, they aren’t going to just eat the cost, they will pass it on to the consumer and the people you thought you were helping will end up paying for it in the end. America was founded and became great on the idea that if you work hard you can make a lot of money and prosper. We hit a rough patch and now everyone wants to take the money from the rich and give it to the poor. Where is the incentive to work hard?????

If you tax the rich they will just up and leave, they have the money to go were they want. Even a modest 3% tax on wealth would make a sizable number move out, and then your back to square one.

Hey David. I say good riddance. Those greedy bastards are the reason we are where we are. There is a difference between “free market” and “greed rules”. If you can’t tell the difference, study recent headlines for awhile.

Decisions:

To be wealthy and live in the USA.
To be excessively wealthy and live in a tax sheltered country.

…hmmm

Flow chart looks great….

David…the argument that wealthy will move to other countries is bogus. They like living here, their families are here, their friends are here, their homes and their long term interests are here……they aren’t going to pack up and go and live along amongst people they have no relation to just because they got taxed a little.

@David: I agree with your point to a degree, but the USA provides a secure and stable place for these corporations to do business – not to mention a ready market of willing consumers to sell to. They aren’t just going to leave and go somewhere better, because there isn’t anywhere better…

Certainly, it seems fair that *everyone* should pay something towards any bailout, not just lump the entire burden on the tax paying middle classes – or more accurately, their children and grandchildren.

I agree David. People assume the wealthy will just grin and bear their punishment for the nation’s ridiculous governmental policies and economic illusions. Supporters of all these new taxes should be careful of driving away the source of all this revenue, or those that pay 50% of the country’s taxes will up and leave the party. It throws a wrench in the incentive to earn more.

I have one particular grievance with the “elimination of tax preference for capital gains”. This is described as “taxing wealth and work at the same rate”. Do you understand where people who invest their money get the overwhelming majority of that money? THEY WORK FOR IT!! That’s essentially double taxation on their income already.

You’re basing this off of the supposition that the bailout *had* to happen. That just isn’t the case. End the bailouts!!! Socializing the losses of large companies is not the way to “fix” the economy. Stealing from the rich to pay for a series of bad decisions by powerful people isn’t much better than stealing from everyone.

Interesting comments here. The chart above is more or less a spoof, or humorous peice, and I see people in here getting angry about it.

I really believe bailouts are a cop-out and a pure example of the greed and corruption of Washington. If I start a business, and run it into the ground, why is it that I don’t get a bailout? Oh wait, because I’m not a multi-billion dollar CEO, that’s why. Only the richest people in america “deserve” the bailouts right? It’s all a huge joke!

…Or, we could just refuse any sort of bail-out. Why should a company or individual that didn’t manage their finances well get a hand-out? They should have to suffer the consequences. Stealing from those that are financially conservative is not a good policy, and it certainly isn’t the American way.

I’m proud that many people here recognize this for what it is: socialism.

I think most of the people here are missing something in the discussion of Rich People moving to other countries. Just moving to another country with lower taxes does not mean you no longer have to pay United States Income Taxes. The only way that you can avoid paying those would be to give your US Citizenship. How many of these Rich People would be willing to do that?

Why is that last section all about taxing MORE? Maybe we should cut some government spending and find $900B that way.

Sure a few of those loopholes need to be closed but lets get a Lean government first.

I honestly don’t have a clue where the author thinks the money companies will use to pay increased taxes is going to come from. If you accept reduced profits, then the result is a worsening stock price for large companies, which in turn affects the rest of the market. Instead, companies simply trim jobs and cut benefits to employees, as far as that is possible; at that point, they can then take their lumps in the market.

It would be lovely if we could just tax ourselves to prosperity, but it is as simplistic an idea as tax cuts as the only avenue for economic recovery.

But that’s fine, I’m sure you feel better after sticking it to the rich people!

I agree 100% with david. This is quite possibly the worst/retarded suggestion ever on what the government should do. The rich already pay a ridiculous percentage ( alomost 40 in income taxes alone) of their income in taxes and now you want them to pay a 50% emergency tax??? Idiotic……

“joe blow”, “Thats Just Dumb”, “Storm9″, “David”, “Mclusky” and “Robert”,

hummm… from what I’ve seen recently, it’s the RICH who are begging for our tax dollars.

The head of Fannie Mae, Daniel Mudd, reaped a 7 percent rise in pay last year (2007), to $13.4 million, while the company lost money and the country suffered its worst housing crisis in decades. THESE ARE THE PEOPLE THAT NEED TO BE DISGORGED OF THE MONEY THEY STOLE!!!!!!! These CEO’s like Countrywide’s Mozillo are NOT representative of the free hand of capitalism that America is based on. They want the government off their backs when they’re making money, and when they are collapsing, here they come begging. LET THEM FAIL NOW.

What our government is doing right now is CORPORATE SOCIALISM and it is plain for all to see. You idiots criticizing the “theoretical” diagram above, why don’t you speak out against the REAL raping of the american worker and the wealthy americans who earn their money legitimately? Speak out against CORPORATE THIEFS NOW.

Hello? Anyone there?? I didn’t think so…

The error in accepting this as a better source for the bailout is that, in order to that, you must first accept that there needs to be a bailout.

I’m with AJ – refuse the bailout, or more correctly termed, nationalization of private industry.

Stop being afraid of socialism? ha! Well you are right, you should not FEAR anything, including socialism. However, that doesn’t meant you shouldn’t understand it and be able to squash it. Socialism is the death knell of liberty and sovereignty, and by destroying those you also destroy standards of living, entire economies, and even classes of society.

We are certainly on our way! It’s too bad that so many people have to wait until it knocks on their front door before they’ll acknowledge it’s really happening.

Yeah ummm, socialism is the right way to go…. errrr ummm WTF!!! Its only a matter of time before Obama and his slew of criminals ruin our great country… As far as the big 3 bailout… We dont want the cars they make so why are they making us pay for them…. The people have spoken we dont want to bail out!!!

PS. The true bail out plan

BAILOUT –> DOES NOT HAPPEN

I am investing in ” Payless”

Actually, all the money being paid in the bailout is pointless. Americans are defaulting yes, some of those are going to happen anyway. Some are loosing their jobs and a good mortgage is going to lead to foreclosure just as fast as a bad one. Everywhere I look, I see this company closing this factory and moving it somewhere else – Mexico, China, etc. As long as this continues, we are going to keep falling. The NAFTA style agreements are doing this. In my area, there are 2,000 people at the unemployment office trying to get the 46 jobs available. What are those, SERVICE jobs, you can’t move them to another country. The only way to turn this around, is to stop the bleeding of jobs out of the US. How? The NAFTA style agreements are binding, they can’t be easily undid. We do what they don’t address. WE TAX MONEY LEAVING THIS COUNTRY. 50-90 cents of every dollar will fix most of it, A company wants to hide off-shore, no problem, they will not be making a good profit until they move BACK into the US along with the jobs they moved out. The US Dollar would start increase in value as less of them would make out of this country. CEO xyz wants to hide his income, where, not outside the US.

This will never happen, we have the best government that can be bought. The ones buying the government are the same ones that would lose most by a scheme like this. Get ready for the worst depression there will be. Remember, when the banks can’t take away you property, the government will for unpaid back taxes, that happened in the 30’s the few that remember that time will know what I’m talking about; the rest of us forgot that part of history, and we are about to live it again! Good Luck!