Wednesday, August 29, 2012

"Now you see it....now you don't."



I recently read that the Greek government, which we all know is an economic basket case, is about to finalize a treaty with Switzerland that will allow them access to the records and the money, estimated to be up to 20 billion Euros, that wealthy Greeks have parked in Swiss banks as a tax dodge.  This follows on similar treaties that Germany, Austria, the UK, and I believe the US, too (?) have negotiated, all to catch tax cheats and bring in more dollars, pounds, and Euros to the respective government coffers.

The problem is, however, that there is a lag time of many months after signing a treaty before it goes into effect.  The wealthy, some say with the help of their Swiss bankers, are using this interlude to move their money to new tax shelters being set up in wealth-friendly Hong Kong and Singapore.  In other words, it's still out of reach of the tax revenooers.

Here's my question:  In this country at least, the wealthy argue that their taxes should be cut dramatically because it is they and their money that create jobs.  If billions of dollars (some say TRILLIONS of dollars) are constantly on the move in this giant shell game of tax dodge, how is that creating jobs?

Somebody please 'splain it to me.  What little business acumen I have doesn't understand how this ultra-high-roller game is played.  Seems to me this is just making the case for those who argue "the rich get richer".  What am I missing?

S


5 comments:

  1. I beleive the conservatives argument is that taxes not be dramatically raised, NOt sure they are asking for dramatic cuts.

    As to illegal tax shelters:

    Like people in all economic strata, apparently some of the uber rich are criminals!

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  2. The rich do not create jobs. they create wealth in sort of a 'mine's bigger than your's' game. It is demand that creates jobs. Any idiot with even a semblance of a brain can figure that one out. Without demand, there is no reason for jobs. No money to to create demand means no demand and therefore no jobs. I guess that means that half the people in this country don't even have a semblance of a brain. The rich do spend some of their money on big high dollar items like yachts, jets, another mansion but that's not what drives the economy. It's the middle class that drives the economy. Anyone who listens to the whining rich and falls for their song and dance should just hand over everything they have and go live on the street. Because if they support the rich, that's where they're going to end up anyway. Why drag it out?

    Sorry, I'm pretty sure you have more than a semblance of a brain.

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  3. In layman's terms.

    Offense - Make as much money as you can.

    Defense - Try to keep it.

    Tax strategies are defensive measures. As for the analogies of the rich I must tell you most rich folks *Actually* play defense as well as anyone and rarely will you know they are rich. So this business about crazy spending is in direct opposition to their defensive nature.

    Having money parked elsewhere is not illegal in itself. Parking it with the sole purpose of avoiding taxes is another matter.

    Hell, we buy houses and write off business expenses in an effort to save ourselves on taxes.

    Just another way to play Defense.

    I call it a "quality" problem. We should all have quality problems...

    Imagine having too many houses to build with massive profit margins. A quality problem for sure.

    The rich simply get richer for they play defense. Think about it on any scale and I dare say you cannot think of too many teams that played poor defense that went very far. Same thing with money...

    Cheers,
    Bobby



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  4. I want to get rich enough to hire a very smart tax lawyer to tell me how to hang onto all that money!

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