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Insider Report from Newsmax.com Headlines (Scroll down for complete stories): 1. Raising Minimum Wage Called 'Reverse-Robin Hoodism' 2. Top Tax on U.S. Dividends Actually 56.5 Percent 3. Texas Capital Is America's 'Best City to Live In' 4. Thousands Sign Petition to Put 'British Schindler' on a Stamp 5. U.S. Now Competitive With Chinese Manufacturing 6. Russia Burning 'Contraband' Food From West
1. Raising Minimum Wage Called 'Reverse-Robin Hoodism' An array of proposals from lawmakers, as well as the Obama White House, have called for increasing the federal minimum wage from $7.25 an hour to as much as $12 or even $15, and several cities including San Francisco have already approved a hike to $15. But a new report asserts that since raising the minimum wage would cost the jobs of some low-wage workers and benefit others, it in effect would constitute "reverse-Robin Hoodism" — robbing the poor rather than the rich. "Overall, the income gains from raising the minimum wage would come at a significant cost to the large number of workers who would become jobless," according to the report based on research by Douglas Holtz-Eakin and Ben Gitis and published by the Manhattan Institute for Policy Research. "Raising the minimum wage transfers incomes from the low-wage workers who become jobless to the low-wage workers who remain employed." The report states: "In other words, this is reverse-Robin Hoodism: taking jobs and income from the poorest to give to those who are better off. The wealthy would be untouched." The researchers estimate that raising the minimum wage to $12 per hour would affect 38 million workers — those currently making from $7.25 to $12 an hour, and others who are making slightly more but who the researchers argue would also see an increase in income. The hike would cost 3.8 million jobs. And a mere 5.6 percent of the income gained would go to workers at or below the poverty line, while 40 percent would go to families with incomes one to three times the poverty threshold; the rest would go to families with even higher incomes. Raising the minimum wage to $15 would affect 55 million workers and cost 6.6 million jobs; only 6.7 percent of the income gained would go to workers in poverty. The researchers note that the workers who are most likely to become jobless due to the minimum wage hike would be the low-wage workers the increase was intended to help. They add: "We find that any potential benefits from raising the minimum wage would be greatly offset by the negative labor-market consequences of the policy." Holtz-Eakin is president of the American Action Forum and former director of the Congressional Budget Office. Gitis is director of labor-market policy at the American Action Forum. Editor's Note: 2. Top Tax on U.S. Dividends Actually 56.5 Percent The top federal tax on dividends is stated at 23.8 percent, one of the highest rates in the developed worlds, but the total tax is actually much higher — 56.5 percent, according to an analysis by the Tax Foundation. The current federal top marginal tax rate on dividend income is 23.8 percent for individuals with an adjusted gross income of $200,000 or more and for married couples earning at least $250,000 and filing jointly. That figure represents a 20 percent rate on dividends plus a 3.8 percent tax on unearned income to fund Obamacare. But 43 of the 50 states also levy a tax on dividends, with the highest rate, 13.3 percent, in California, followed by Hawaii (11 percent). The average top marginal tax rate for all states, including both federal and states levies, is 28.6 percent. That's the ninth highest rate among the 34 nations in the Organisation for Economic Co-operation and Development (OECD). The highest rate is in Ireland, 51 percent, and the average is 24 percent, 4.6 percent lower than in the U.S. Two OECD nations do not tax dividends: Estonia and the Slovak Republic. But that 28.6 percent average top rate in the U.S. is misleading because dividend taxes are in fact examples of double taxation. The Tax Foundation offers the example of a company that earns a profit of $100. It would need to pay the combined federal and state corporate income tax rate of 39.1 percent. Its after-tax profit is $60.90. The company then distributes those profits as dividends to its stockholders, who need to pay the average 28.6 percent combined federal and state personal dividend tax, $17.42. That means the total tax on the $100 in profits is $56.52 — a 56.5 percent tax rate. "The U.S. personal dividend tax is a double tax on corporate profits, biases corporate behavior, and leads to lower savings, less investment, lower wages, and lower living standards for all," the Tax Foundation observed. "The combined burden of federal, state, and local taxes on dividend income creates marginal rates that exceed the dividend tax rates of most of the United States' major trading partners. Reducing the tax burden on savings and investment will lead to faster economic growth, higher wages, and better standards of living." Editor's Note: 3. Texas Capital Is America's 'Best City to Live In' New research analyzing a wide range of factors determines America's best large cities to live in — and puts Texas' capital, Austin, at the top of the list. WalletHub.com, a personal finance website, has released its "2015 Best & Worst Large Cities to Live In" report, and it ranks Detroit at the bottom of the list. WalletHub compared all U.S. cities with a population of more than 300,000 in the 2010 Census. The figures are for the cities proper, not their metropolitan areas. The four main metrics considered are livability, education, health, and local economy/taxes. Livability includes recreation, diversity, political engagement, driving, and other factors. Health includes obesity, participation in physical activity, number of fitness centers, and life expectancy. The local economy category includes the job market, affordability, energy expenses, and household income adjusted by the cost of living. Top-ranked Austin, a city of around 912,000, ranks No. 2 for education, No. 2 for local economy and taxes, No. 7 for livability, and No. 21 for health. Raleigh, N.C., ranks No. 1 for education and No. 2 overall; Colorado Springs, Colo., ranks No. 1 for livability and No. 3 overall. San Francisco is top-ranked for health. Fort Worth, Texas, is No. 1 for local economy but finishes at No. 47 overall due to poor rankings in the other categories. Rounding out the top 10 cities overall are San Jose, Calif.; Seattle, Wash.; San Diego, Calif.; Denver, Colo.; San Francisco; Lexington, Ky.; and Virginia Beach, Va. Lowest-ranked Detroit (No. 62) fares poorly in all four broad categories, including dead last in livability. Other low-ranked cities, in ascending order, are Memphis, Tenn.; Philadelphia, Pa.; Cleveland, Ohio; Indianapolis, Ind.; Wichita, Kan.; St. Louis, Mo.; Milwaukee, Wis.; Tulsa, Okla.; and Fresno, Calif. Other findings from WalletHub include:
4. Thousands Sign Petition to Put 'British Schindler' on a Stamp Responding to a campaign launched by a British website, more than 85,000 people have signed a petition seeking to put "British Schindler" Nicholas Winton on a postage stamp. Winton, who died in July at age 106, saved the lives of hundreds of children, most of them Jewish, by organizing their escape from Nazi-occupied Czechoslovakia shortly before World War II. The campaign was launched by Britain’s Jewish News website, jewishnews.com.uk, and is backed by the Holocaust Educational Trust and the Association of Jewish Refugees, the Jewish Telegraphic Agency reported. Winton was born in London to immigrant German Jews who converted to Christianity and had him baptized. In December 1938, Winton — a 29-year-old stockbroker — canceled a planned skiing trip in Switzerland and instead went to Prague, Czechoslovakia, at the behest of a British colleague who was dealing with a refugee crisis as the Nazis prepared to invade. Over the next nine months, he organized the loading of 669 children onto eight trains that brought them out of Czechoslovakia to the Netherlands, where they boarded a ferry to Britain. He also helped find homes for the children. Among the children saved was future filmmaker Karel Reisz. Many of the children's parents died in Nazi concentration camps; the last group of 250 children scheduled to leave Prague was unable to depart, and nearly all of them died during the war. Winton's heroism was not publicly known until the 1980s, when his wife found a scrapbook in their attic containing lists of the children. That led to a documentary on British television and the "British Schindler" moniker. The reference is to German industrialist Oskar Schindler, who is credited with saving some 1,200 Jews during the Holocaust. His story was made into the Academy Award-winning movie "Schindler's List." Winton was knighted by Queen Elizabeth and in 2010 he was named a British Hero of the Holocaust by the British government. On Oct. 28, 2014, he was awarded the highest honor of the Czech Republic, the Order of the White Lion. "He was rightly honored in his lifetime including with a knighthood and a statue in his home town," the petition reads. "But his name and the lesson that one person can make a difference even in the face of overwhelming evil, must live on. The rare honor of a Royal Mail stamp would help to achieve that while at the same time being a fitting tribute to Sir Nicholas." Editor's Note: 5. U.S. Now Competitive With Chinese Manufacturing The once-huge gap between manufacturing costs in China and the United States has narrowed to the point where it's barely cheaper to produce goods in China than here in America. Manufacturing wages adjusted for productivity have nearly tripled in China over the last decade, from $4.35 an hour in 2004 to $12.47 an hour last year, according to the Boston Consulting Group. In the U.S., manufacturing wages adjusted for productivity have risen less than 30 percent since 2004, to $22.32. But the higher wages for American workers are offset by lower costs for energy and raw materials. The total cost to manufacture goods in China for every $1 required in the U.S. is now $0.96. "Everybody believed that China would always be cheaper," Harold Sirkin, a senior partner at Boston Consulting, told The New York Times. "But things are changing even faster than anyone imagined." The U.S. is becoming more competitive with other nations as well. It now costs more than $1 to manufacture goods in Korea for every $1 required in the U.S., and between $1.10 and $1.20 in Canada, Sweden, Japan, and the Netherlands. For every $1 required in America, it costs between $1.20 and $1.30 to manufacture goods in Germany, Italy, Brazil, Belgium, France, and Switzerland. The only nations cited by Boston Consulting where it costs less than $0.90 to produce goods for every $1 required in the U.S. are now India and Indonesia. The Times offered the example of the textile industry. Rising costs in China due to higher wages, energy bills and cotton prices have actually induced Chinese companies to open up textile mills in the U.S., where energy is cheaper, and employ American workers. Last year it cost just over $1.50 to manufacture one pound of yarn in the U.S., compared to more than $2.00 in China. The cost is also lower in the U.S. than in India, Brazil, Korea, Italy, or Egypt. "Once the epitome of cheap mass manufacturing, textile producers from formerly low-cost nations are starting to set up shop in America," The Times observed. "It is part of a blurring of once seemingly clear-cut boundaries between high- and low-cost manufacturing nations that few would have predicted a decade ago." Editor's Note: 6. Russia Burning 'Contraband' Food From West A year after it imposed an embargo on most produce, meat, and dairy products from the United States and European Union, Russia has launched a campaign to destroy all contraband foods found in the country. This past week "federal agencies began confiscating and burning hundreds of tonnes of illicit cheese, fruit and other products (1 tonne = 1.10 U.S. ton)," acting on a decree signed by Russian President Vladimir Putin, the Financial Times reported. Incinerators to destroy the foods have been put in place at Russian border points. In Moscow, officials said they had seized 28 tonnes of meat products from Canada, the Netherlands and Germany, and 28 tonnes of Polish apples and tomatoes. Under Putin's decree, authorities now have the right to destroy any contraband food that they find in restaurants and grocery stores. Previously it was illegal to transport sanctioned food products into Russia but not to sell them once they had arrived. Now a Duma deputy has proposed a bill that would make importing contraband food products into Russia a criminal offense carrying a jail term of up to 12 years. Russia banned the items last August in retaliation for Western sanctions and to boost Russia's own agriculture industry. As a result, consumers have faced higher food prices due to the lack of supply. The campaign has also raised questions about destroying food in a nation where more than a tenth of the population lives below the poverty line, the Financial Times noted. Vladimir Soloviev, a pro-Kremlin TV host, tweeted: "I don't understand how a country that lived through horrible famine during the war and the post-revolution years can destroy food products." Most contraband food enters Russian from Belarus, which has an open trade border with Russia. Note: Newsmax magazine is now available on the iPad. Find us in the App Store. Editor's Note: Editor's Notes: |
Sunday, August 9, 2015
INSIDER REPORT FROM NEWSMAX 08/09/2015
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