But for so many of us today, these issues are just so much "talking heads" noise. The American public is much more focused, in this day of financial turmoil, on "meat and potatoes" issues of the economy. And the health of Wall Street isn't as significant as the "Main Street" viewpoint of "what about my job, my healthcare, my TAXES?"

The discussion of taxes occupied a prominent portion of the final debate and "Joe the Plumber" has become a phenomenon!

Unfortunately, neither candidate clearly articulated their own or their opponent's tax policies clearly or concisely enough that the casual viewer could possibly extract a lucid understanding of how their policies would or could affect U.S. It then falls to analysts and commentators to distill it all down for public consumption.

So, here are some Tax Facts to bear in mind as you evaluate the candidates and their statements on taxes.

* Remember that there are scores of taxes imposed on the American people... not just the income tax. Your net buying power is affected by the sum total of them, and not just the income tax. So if you have your income tax reduced, but taxes on the goods and services you buy increase, you may see a net reduction in your purchasing power though you have more dollars in your pocket. Moreover, if tax policies result in higher prices, this is effectively a hidden tax as your purchasing power erodes.

* 30% of Americans have no income tax liability! They pay no income tax. When Obama offers "tax relief" to 95% of the people, 1/3 of those people will get "relief" in the form of a check when they paid nothing into the system! This is classic socialistic redistribution of wealth. Obama unwittingly revealed this intent in his "Joe the Plumber" conversation.

* Even if it were so that 95% could or would receive a tax cut, the top 1% of taxpayers (AGI over $364,657) earned approximately 21.2% of the nation's income (as defined by AGI), yet paid 39.4% of all federal income taxes. Yes, almost 40% of all income taxes are already paid by the top 1%. Based on these numbers, is further soaking the "rich" sustainable?

* Tax cuts for the rich? You are in the top 25% of income earners if you bring in more than $62,068 a year. (Bet you didn't know that means you're rich…) The top-earning 25 percent of taxpayers (AGI over $62,068) earned 67.5% of nation's income, but they paid more than four out of every five dollars collected by the federal income tax (86%). (source) This means that the bottom 75% of earners already bear only 14% of the burden despite earning almost 1/3 of all the income. Who needs tax relief? If you're in the top 25% at $62K, how low must your income be to be considered by some to be "middle class"? Low enough to be one of those not paying income taxes at all?

* Tax cuts don't reduce federal revenues; they stimulate economic growth which results in increased revenues to the federal government! It happens every time it's tried.  Kennedy's tax cuts raised revenues. Reagan's tax cuts doubled revenues. Bush's tax cuts also increased revenues. (Spending is another issue entirely.)

* Tax breaks for corporations that send jobs overseas: The implication, of course, is that there is some policy, implemented or proposed, to reward companies for sending jobs abroad. There is not. A generalized policy toward tax relief on business in general (which would positively impact the economy as a whole) would be a tide that lifts all boats – including those who might outsource – but there is no concerted effort to inventivize shipping jobs offshore.

* On the other hand, there are dis-incentives in the tax code to bring overseas jobs back home. Removing these barriers has been painted as a "tax break" for companies who have overseas operations, even though doing so would bring these operations back home. Currently, the U.S. has the second highest tax rates on businesses in the world, something mentioned by John McCain during Wednesday’s debate. When a company has overseas operations, they pay the prevailing tax rate in the country of the operations. Here is the conundrum: Whatever the difference is between that overseas tax burden and our U.S. rates is required to be paid to the US, but is deferred as long as the operations remain overseas. Upon repatriating these operations back to the U.S., the cumulative difference is immediately due. Therefore, companies can avoid paying this accrued tax by remaining overseas. (These policies have been in place since long before George W. Bush, by the way.) If this barrier to returning home could be mitigated, many operations would be repatriated, creating domestic jobs and stimulating our economy. This could be accomplished by a moratorium on collecting the accrued difference, by allowing the accrued difference to be amortized over a number of years, or by removing the requirement to pay the difference at all. Furthermore, the current high corporate tax burden in the U.S. drives business overseas to pay the lower rates and defer the difference, so cutting the rate to a rate more competitive with the global market would keep more business at home in the first place.

* Corporations don't pay taxes? The fact is that corporations consider taxes part of their cost of doing business, and so they respond to increased taxes in one of two ways: they either increase the cost of the goods and services they provide (impacting their customer's buying power) or they reduce other costs by cutting jobs. When we say we will reduce taxes for the "middle class" and increase taxes on those earning over $250,000 (which are primarily small businesses who employ people), we will see higher prices – which reduces buying power and therefore hurts the "middle class."

Sadly, most Americans do not understand these facts, and are therefore easily swayed by eloquent "we're going to take care of you" speeches. Whenever a politician promises you a free goodie, please: ask “how?”

Isn't it interesting how predictable the American Left is? When someone scores an indisputable point against "the One", they ignore the message and attack the messenger! "Joe the Plumber" has revealed and highlighted Obama's socialistic agenda – and it's had an impact on Obama's support! So he must be destroyed.

First, we heard the immediate "I don't know any plumbers making $250,000" argument. I'm still not sure what the purpose of such a statement could possibly be, but the dismissive tone accompanying the statement is obviously intended to attempt to ridicule Joe away! But the statement is completely disingenuous, as Joe didn't even say he was a plumber, nor that he makes $250K.  He said he's considering buying a PLUMBING COMPANY, which EMPLOYS plumbers, and which GROSSES around a quarter mil. He didn't say he makes $250K. He didn't say he'd EARN 250K after buying the business. The business grosses $250K. The business pays it's employees. The business maintains its vehicles. The business buys its materials. The business pays for its office, phones and utilities. The business pays its taxes. The business pays to advertise. After all that, the business owner can take a salary.

Next the LeftMedia lights up with the accusation that Joe isn't even a registered voter. Aside from the fact that this is blatantly false… Joe is registered and voted in the OH primaries… what possible relevance would this have? I thought ACORN has, as its purpose, to get unregistered people interested, active and REGISTERED now! So here's a guy who's now very interested and engaged in the political process. We should rejoice!

So then the thugocracy dispatches their investigators to dig dirt on Joe. They claim he's not licensed… But he doesn't need one presently, and the company he works for has one! From the Toledo Blade, "According to Lucas County Building Inspection records, A. W. Newell Corp. does maintain a state plumbing license, and one with the City of Toledo, but would not be allowed to work in Lucas County outside of Toledo without a county license." Does he even need one to OWN a plumbing company that EMPLOYS plumbers?   And again, how is this relevant to Obama's Socialism?

Finally, the thugs discover that Joe has a tax lien on about $1100 he owes in back taxes. Does this mean he's not credible to ask Obama a question on the impact of his tax policies? Does this have bearing on the fact that Obama's answers reveal him to be a Robin Hood Socialist bent on redistribution of wealth? It would seem that someone struggling to meet his CURRENT tax liability would be uniquely appropriate to question how Obama's policies might make matters worse!

You may have heard the phrase, "Don't kill the messenger."  This phrase is usually attributed to the ancient Greek and then later Roman custom of employing messengers to carry news throughout the empire. The law PROTECTED these messengers, and decreed that they should be allowed to pass unharmed as they carried out their duty, even if the recipients found the message distasteful.

Sadly, Obama and his minions DO try to destroy anyone who can bring a message critical or damaging to the campaign. Live long and prosper, Joe!

Copyright © 2008 by Doug Edelman

A giveaway of hundreds of billions of dollars is not only bad policy, it is not necessary! Unfortunately, the Democrats have successfully brainwashed the public into believing that the problem was caused by deregulation, when in fact it was caused by Democrat inspired rules and regulations which set up a house of cards in our economy.

When it became apparent that this house of cards was getting large, and wobbly, those who raised the warning flag (Republicans) were shot down by defenders of the system (Democrats). See: http://www.youtube.com/watch?v=fa0agm7lIPQ There you’ll see video of the 2004 Fannie/Freddie hearings. You’ll see who tried to forestall the collapse, and who denied there was a problem. Who questioned the management of Fannie & Freddie, and who declared the raising of the question to be a “lynching” of Franklin Raines, and who praised Raines management at the helm.

Despite the minimal likelihood that the fix outlined below would stand a chance of being implemented, given our current political environment, I will outline a plan that WOULD work in the hopes that SOME of these proposals might be incorporated into any plan that makes its way thru congress.

• NO taxpayer giveaway of hundred of billions of dollars and don’t put it in the hands of Paulson and Bernanke!
• Provide assistance in the form of LOANS and INSURANCE. The government does not need to take OWNERSHIP of private institutions like AIG! Do NOT SOCIALIZE our markets.
• Prohibit all naked market trading. If you want to trade it… OWN it!
• ELIMINATE the “Mark to Market” rule – which artificially pulls capital off the books of financial institutions and is a contributing factor to the crisis. This rule requires securities to be recorded on the books at the lowest value it might be sold for in a panic firesale – even zero - rather than their ACTUAL value. This results in under-capitalization even when REAL assets are adequate!
• REPEAL the Community Reinvestment Act, and dismantle or downsize Fannie Mae & Freddie Mac
  • Well intentioned, the act sought to end the practice of “redlining” where certain neighborhoods were deemed unsuitable risks for mortgage loans. While the purpose to put homeownership within the reach of more lower income people is laudable… the execution was poor.
  • As Fannie Mae and Freddie Mac grew under Clinton, and the “Affordable Housing” mandates forced the lowering of lending standards to allow more and more people to “qualify”, the “sub prime” market ballooned. Variable rate loans with low intro rates to get people INTO homes were the norm for these “sub prime” loans.   But adjustable rates WILL adjust, and if artificially low at inception, the direction of that inevitable  adjustment is most assuredly upward. Lenders and borrowers alike completely ignored the factor of affordability AFTER an upward adjustment in the interest rate!
  • Lending institutions were COMPELLED by federal regulators to write more and more of these sub-prime loans. They had target numbers of low-income homes they had to finance or face penalties and further regulation. So qualification requirements were further relaxed, and more “creative” financing options emerged. No money down; Interest Only financing; Negative Amortization loans. Anyone who was paying attention at the time was asking, “How the heck can that work??
  • Mortgage brokers ORIGINATED loans, with no intention of CARRYING the loan thru amortization! They wrote the paper to sell it to a larger entity – who was happy to buy them up, as they were securitized by the GSEs (Government Secured Entities) such as Fannie and Freddie. Fannie & Freddie grew and grew, securitizing ultimately 80% of all mortgages – meaning they held just about ALL the bad paper! A house of cards DOOMED to fall!
• Institute a moratorium on Capital Gains taxes… allow businesses to put their OWN money to work to climb out of the crisis.
• Make the Bush Tax Cuts permanent. More money in the hands of consumers will stimulate the economy. Raising taxes in a period of economic downturn is suicidal.
• PULL DOWN the tax DISincentives to repatriating overseas operations back home in the USA.
  • There are no tax INCENTIVES (existing or proposed) to move job overseas, Obama ads notwithstanding. There are, however tax BARRIERS to bringing overseas operations BACK HOME.
  • A company with offshore operations pays the taxes in that country. If those taxes are lower than US taxes… the difference is owed to the USA. BUT as long as they REMAIN overseas, they defer that debt. An incentive to STAY overseas.
  • Upon repatriating those operations, a company would owe ALL the difference in tax. A company will not have to pay that for as long as they REMAIN overseas.
  • A moratorium on collecting the deferred tax difference for companies repatriating operations back home would stimulate the economy by creating domestic jobs and returning industry to our shores.
• ENFORCE our borders and our immigration laws. Illegal immigration is a huge drain upon our nation’s resources.
• Return to the gold standard. Set the dollar at 1/500 of an ounce of gold and back our dollar with more than a promise to pay. Stabilize the dollar's value abroad and eliminate short selling of our currency.
• Eliminate the Federal Reserve. A PRIVATE CORPORATION which creates currency out of nothing, and LENDS it to the government at interest! The CONGRESS is constitutionally empowered to coin money… not the FED.
• REPEAL Sarbanes-Oxley. Another well-intentioned but poorly executed regulation crafted in the wake of Enron/Worldcom. (Which are small potatoes scandals when laid next to Fannie/Freddie!!) SARBOX compliance has placed an undue burden upon “play by the rules” companies, but has done little to curtail the abuses by those who have purposed to “cook the books”.

Of course, too many have too much vested interest in NOT implementing the above for it all come about, though if it did our economy would BOOM!

On the other hand, if SOME or ANY of the above can be incorporated into any next attempt at a rescue bill… we may achieve a bill that will stop the bleeding and restore confidence in our markets.

Copyright © 2008 by Doug Edelman

Doug Edelman is a conservative political commentator and has been a contributing editor for The Conservative Voice.  His work is also seen on News By Us, The American Daily, The Post Chronicle, New Media Journal, Capitol Hill Coffee House etc. For the support of his family, however, he is also an IT Consultant/Contractor and owner of a Computer Services Business.  He has taught PC Maintenance & Repair and Networking at his local Community College.