CBO: Feds Borrowing $4.8 billion Per Day in FY 2013, So Far

(CNSNews.com) – The federal government ran a deficit of $292 billion for the first two months of fiscal year 2013 – October and November 2012 – amounting to $4.8 billion of borrowed money each day.

“The federal budget deficit was $292 billion for the first two months of fiscal year 2013, $57 billion more than the shortfall recorded in October and November of last year,” CBO said in its Monthly Budget Review Friday.

This means that the government borrowed $4.8 billion for each calendar day so far in 2013. If the Treasury Department restricted its borrowing to only weekdays, its per day average would jump to $6.5 billion per day thus far in fiscal year 2013.

READ MORE:  http://cnsnews.com/news/article/cbo-feds-borrowing-48-billion-day-fy-2013-so-far

'Welfare Spending Equates to $168 Per Day for Every Household in Poverty'

The amount of money spent on welfare programs equals, when converted to cash payments, about "$168 per day for every household in poverty," the minority side of the Senate Budget Committee finds. Here's a chart detailing the committee's findings:



According to the Republican side of the Senate Budget Committee, welfare spending per day per household in poverty is $168, which is higher than the $137 median income per day. When broken down per hour, welfare spending per hour per household in poverty is $30.60, which is higher than the $25.03 median income per hour.

"Based on data from the Congressional Research Service, cumulative spending on means-tested federal welfare programs, if converted into cash, would equal $167.65 per day per household living below the poverty level," writes the minority side of the Senate Budget Committee. "By comparison, the median household income in 2011 of $50,054 equals $137.13 per day. Additionally, spending on federal welfare benefits, if converted into cash payments, equals enough to provide $30.60 per hour, 40 hours per week, to each household living below poverty. The median household hourly wage is $25.03. After accounting for federal taxes, the median hourly wage drops to between $21.50 and $23.45, depending on a household’s deductions and filing status. State and local taxes further reduce the median household’s hourly earnings. By contrast, welfare benefits are not taxed."

READ MORE:  http://www.weeklystandard.com/blogs/welfare-spending-equates-168-day-every-household-poverty_665160.html

Yes, This Is an Emergency

If you smelled smoke and saw flames rising from your small business, the first call you’d make would be to your fire department. Well, it’s time to dial Congress’ 911 number. The warning signs are clear—your small business and millions of others could get burned in the Fiscal Cliff negotiations unless you shout for help.

There is no more urgent act you can take today than to personally call your U.S. representatives and senators. Plead with them to answer the bell to protect small businesses from free enterprise opponents who don’t realize that increasing your taxes is like playing with matches.

If the anti-small-business forces in Washington win the fight to let the 2001 and 2003 tax relief measures to expire--if they yank the props from under the estate tax exemption so it falls from $5 million to $1 million and rates skyrocket to 55 percent--if they succeed in raising alternative minimum taxes on 31 million Americans and wiping out many vital small-business tax extenders--the impact on Main Street will be as devastating as a four-alarm fire.

READ MORE:  http://www.nfib.com/insight?roi=echo4-21292200735-18860315-aea72a56db762de4122c5c0eed82dab7&cmsid=61532&utm_campaign=Insight1206&utm_source=Insight&utm_medium=Email

(Reuters) - The U.S. Internal Revenue Service on Wednesday released final rules for a new tax on medical devices, products ranging from surgical sutures to knee replacement implants, that starts next year as part of President Barack Obama's 2010 healthcare law.

The 2.3-percent tax must be paid, effective after December 31, by device-makers on their gross sales. The tax is expected to raise $29 billion in government revenues through 2022.

Companies including Boston Scientific Corp, 3M Co and Kimberly-Clark Corp have been lobbying the U.S. Congress for a repeal of the tax.

A repeal bill passed the Republican-controlled U.S. House of Representatives in June, but it has not been voted on by the Democratic-controlled Senate.

READ MORE:  http://www.reuters.com/article/2012/12/05/us-usa-tax-irs-idUSBRE8B41GW20121205

Why Apple is investing $100 million in U.S. manufacturing

"Those jobs aren't coming back." That's what Steve Jobs said when President Obama asked him whether Apple would ever consider manufacturing its popular products in the U.S. But Jobs' successor, Tim Cook, has other ideas. In interviews with Bloomberg Businessweek and NBC News, Cook has revealed that in 2013, Apple will invest $100 million in manufacturing computers in the U.S. "I don't think we have a responsibility to create a certain kind of job," Cook told Bloomberg. "But I think we do have a responsibility to create jobs."

Cook didn't specify which product would be manufactured in the U.S., though it's been noted that the new iMac already bears the label "Assembled in the U.S.A.," making it a likely contender. Cook acknowledged that Apple won't literally make the products, but would continue its practice of hiring contractors to manufacture various elements. Cook also reminded his interviewers that some components — such as the iPhone's glass screen — are already being made in the U.S.

READ MORE:  http://theweek.com/article/index/237471/why-apple-is-investing-100-million-in-us-manufacturing

S&P downgrades world's oldest bank to junk status

AFP - Standard & Poor's on Wednesday cut its credit rating for troubled Italian bank Monte dei Paschi di Siena -- the world's oldest surviving lender -- to speculative-grade status of BB+ from BBB-.

The ratings agency said it was also placing the bank on negative outlook.

"Deteriorating trends in Banca Monte dei Paschi di Siena's financial position make it unlikely that the bank would restore profitability and improve its capital and funding position in line with our previous expectations.

"The difficult economic and operating environment we anticipate in the Italian market will compound the challenges for MPS to implement successfully its business plan," the agency said in a statement.

READ MORE:  http://www.france24.com/en/20121205-sp-downgrades-worlds-oldest-bank-junk-status

Online sales tax to be added to defense authorization bill

This may be the last Christmas of online shopping without paying sales tax.

A proposed online sales tax has been offered as an amendment to the National Defense Authorization Act, much to the ire of opponents.

The Computer and Communications Industry Association, a group that opposes this move, says that an online sales tax will burden small businesses, “some of the most promising candidates for future economic growth.”

 “This proposal, and other online sales tax collection proposals like it, would allow states to penalize the innovative e-commerce business model by targeting small online businesses as convenient sources (and collectors) of revenue,” said CCIA President and CEO Ed Black.

The Marketplace Fairness Act, and its House counterpart the Marketplace Equity Act, seek to clarify, and arguably overturn, a 1992 Supreme Court ruling that requires retailers to have a physical presence in a state in order to collect sales tax on goods.

Read more: http://dailycaller.com/2012/12/04/online-sales-tax-to-be-added-to-defense-authorization-bill/#ixzz2F2lowxzb

Tax hitmen to track your spending

This comes from England but you can bet it's happening in the U.S. as well.  There is even mention of coordination between England and the U.S. in this article.  - Rich

Up to two million people are to have their credit files secretly checked under a crackdown on tax evasion to be unveiled by George Osborne to help raise another £10 billion. 

 Credit reference agencies will cross-check details of the income people declare on their tax returns against their spending patterns to identify “high” and “medium” risks of both illegal and legal tax avoidance.

People identified to HM Revenue and Customs will then be subject to more detailed investigations. About two million people are expected to be scrutinised under the programme, which may lead to privacy concerns.

HMRC will today unveil the “successful” results of a pilot programme involving about 20,000 people which will now be extended nationally.

Many of those who are expected to be identified are likely to be self-employed workers who have under-declared their income to the authorities.

READ MORE:  http://www.telegraph.co.uk/news/9717894/Tax-hitmen-to-track-your-spending.html

 

Guess Who Really Pays the Taxes

Yes, income in America is skewed toward the rich. But taxes are skewed far, far more. The top 5 percent pay well over half the income taxes. STEPHEN MOORE has the numbers.

1. Are income taxes fair?
 
That depends on who is offering the opinion. Democratic candidates for president certainly don’t think so. John Edwards has said, “It’s time to restore fairness to a tax code that has been driven badly out of whack.” Hillary Clinton laments that “middle-class and working families are paying a much higher percentage of their income [in taxes].” Over the past seven years, however, Americans in general think taxes have become more fair, not less. The Gallup Organization found in an April poll that 60 percent of respondents believe the income taxes that they themselves pay are fair, com­pared with 37 percent who believe the taxes they pay are unfair. In 1997, the figures were 51 percent fair and 43 percent unfair. 

2. What income group pays the most federal income taxes today?

READ MORE:  http://www.american.com/archive/2007/november-december-magazine-contents/guess-who-really-pays-the-taxes

Most News Reports Don't Tell Readers or Viewers How Little Money 'Buffett Rule' or Even Obama's Tax Hikes will Raise

A search at the Associated Press's national website on Warren Buffett's last name at about 5 p.m. ET returned two recent items which are still present there. Each item (here and here) mentions the Obama Fan of Omaha's idea to "impose a minimum tax of 30 percent on income between $1 million and $10 million, and a 35 percent rate for income above that." Neither mentions the pathetically small amount such a tax would raise while seriously impacting the ability of high income earners who own or run businesses to expand them -- or in some cases causing them to shrink.

It's the same at other establishment press outlets. Two recent New York Times items found in a search on Buffett's full name (here and here, the latter item being Buffett's own op-ed on Sunday) fail to note how little money Buffett's proposed tax hikes would raise. So how little is "little"?

Read more: http://newsbusters.org/blogs/tom-blumer/2012/11/29/most-news-reports-dont-tell-readers-or-viewers-how-little-money-buffett-#ixzz2El33D7So

What Ludwig von Mises Taught Gottfried Haberler and Paul Samuelson about Tax Loopholes

Tax loopholes are universally denounced across the political spectrum. Democrats revile them as egregious giveaways to the “rich” that should all be tightly sealed up in the interests of “revenue enhancement” for deficit reduction, infrastructure investment, propping up collapsing entitlement programs, etc. Republicans condemn them as major barriers to the implementation of a more business- and investor-friendly flat tax. Even free market economists oppose tax loopholes as inefficient and “non-neutral” to the market economy’s allocation of resources–as if there existed an optimal pattern of coercive redistribution of income from productive, private taxpayers to parasitic, political tax-consumers that was neutral to the market.
Needless to say Ludwig von Mises, who never took his eye off of the larger politico-economic issue of capitalism versus socialism, freedom versus statism, did not share the modern aversion to tax loopholes founded on baseless economistic concerns about “effiiciency” and “tax neutrality.” He pithily summarized the case in favor of tax loopholes, according to the following anecdote related by Paul Samuelson (“Tribute to Gottfried Haberler for American Enterprise Institute Memorial, 18 September 1995″) :

Some of us at sherry before a Fiscal Policy dinner in the Harvard Faculty Club were beefing about certain tax loopholes in the IRS code. Gotttfried [Haberler] whispered quietly, “Capitalism breathes through those loopholes.” The next day I told him how much I had liked his aphorism. Always the straight-arrow scholar, he said, “Yes, but the words are those of Ludwig von Mises not Gottfried Haberler.

READ MORE:  http://bastiat.mises.org/2012/11/what-ludwig-von-mises-taught-gottfried-haberler-who-taught-paul-samuelson-about-tax-loopholes/

Sticker Shock: New Car Prices Are Going Up

The news from Tesla was long expected. Less than six months after delivering the first Model S, the electric vehicles maker is raising the price of the Model S by $2,500.

The base Model S will sell for $59,900 ($52,400 after the federal tax rebate) for those ordered after January 1st. (Read More: Tesla Delivers the Model S, Will It Live Up to Expectations?)

Tesla has said for some time that it would be raising the price of its first sedan, but it's not the only automaker hiking prices.

"There's no doubt you're going to see sticker prices go up," says John Humphrey, Senior Vice President of J.D. Power. "With the content going into new cars and trucks, the costs will have to be passed along to buyers."

What kind of costs? 

The biggest change is with newer more fuel efficient engines. Automakers are required to move the average fuel economy for their fleet of vehicles to 34.1 MPG by 2016 and 54.5 MPG by 2025 (currently at 29.7 MPG). Getting there will mean major upgrades in the engines and components of vehicles.

READ MORE:  http://www.cnbc.com/id/50014208

What Empty Nest? Weak Economy Means Living at Home

You raise them, you educate them and you expect them to go out into the world. But they keep coming back.

The recession and weak recovery appears to be keeping many adult children from getting a home of their own, and that could have implications for the housing industry's recovery.

A Census Bureau report released Wednesday found that between 2007 and 2011 there was a steady increase in the percentage of adults living in someone else's house – and that increase has mostly been driven by adult children moving in with mom and dad.

In 2011, Census Bureau researchers found that 17.9 percent of people 18 and older, or 41.2 million people, lived in a house in which they weren't the head of the household or that person's spouse or significant other. That's up from 16 percent in 2007, before the nation went into recession.

Read more:  http://www.cnbc.com/id/50010517

Pending Home Sales Surge to Five Year High

Buyers are coming back to the housing market in ever greater numbers, as an industry index measuring contracts to purchase existing homes surged 5.2 percent in October from September.

The monthly gauge of pending home sales from the National Association of Realtors was also revised higher in September and is now up 13.2 percent from October of 2011. This is a forward looking indicator for closed sales one to two months from now.

"We've had very good housing affordability conditions for quite some time, but we're seeing more impact now from steady job creation and rising consumer confidence about home buying now that home prices have clearly turned positive," wrote Lawrence Yun, chief economist for the NAR in a release. (Read More: Could Housing Be the Antidote to the 'Fiscal Cliff'?)

Pending home sales are now at the highest level since March of 2007 and have risen, on a year-over-year basis, for 18 consecutive months. The activity, however, varies from region to region, and the Realtors say the Northeast, which saw a 0.1 percent drop in sales month-to-month- did see some impact from Hurricane 

Sandy.


READ MORE:  http://www.cnbc.com/id/49998877

‘Fiscal Cliff’ Could Put Millions of Taxpayers Into ‘AMT Shock’

One of the key questions lurking in the "fiscal cliff" talks — though well below the public's radar — is what happens to the alternative minimum tax, or AMT.

Diane Macdonald | Stockbyte | Getty Images

 

Implemented in 1969 to make sure upper-income Americans pay their share of taxes, the AMT has increasingly snared more middle-income Americans over the years because it was never indexed for inflation.
During the 2011 tax year for example, the AMT hit single taxpayers with incomes as low as $48,450 and joint filers making only $74,450.

But millions more Americans could be subject to the AMT in their 2012 returns if Congress fails to reach a deal on the fiscal cliff before year-end. That's because the AMT is currently scheduled to hit individuals making as little as $33,750 a year and joint filers making $45,000.

READ MORE:  http://www.cnbc.com/id/49981664