This was the post I was working on when Friday came and we all learned the name JAMES EAGAN HOLMES. Some of the heat has gone out of this story, but let’s start with the great controversy that is Mitt Romney’s tax returns. People are complaining that Willard (btw his real legal name, the one he would have to be sworn in under should he win in November), has only released one year of tax returns. This is not true—he hasn’t even done that. Per Lawrence O’Donnell and Forbes Magazine, it’s clear that the filing he has made public doesn’t include FBAR–forms on profits or losses from foreign holdings. That’s all the money from the Cayman Islands and Switzerland and other overseas havens where he has hidden his money. There’s a reason that candidates release tax returns, and the name is Richard Nixon, who was found to be cheating like crazy. And Romney’s stonewalling is up there with Nixon only releasing some of the Watergate tapes and hoping the anger dies down. Eventually, what has been released points to the problems you’re trying to hide.
But I wanted to use this opportunity to talk about the 1% of the 1%. Those of you who’ve seen my play know that (through the character Jerry) I inveigh against state lotteries. The chances of winning are hopeless, the money isn’t going to education, and most purchasers are desperate, low income people who have no legitimate way out of an economic dead end. And as bad as the odds of winning are, the odds of winners HOLDING ONTO THE MONEY are almost as dismal. Lou Eisenberg and Curtis Sharp were the first NY Lotto millionaires, and both lost it all. They are hardly the only such people. And yet, the state of New York takes a chunk of my taxes to retain high-powered media talent to entice people into dropping coin on a rigged game. If a private entity did that, they’d be shut down in short order.
But the real problem with state lotteries is that most people who play them (especially the poorest) are quite clueless about what constitutes being rich in this country. You aren’t going to be in Willard’s country club by winning five million in the lottery. First, you won’t see five mil. In New York State, that will be divided into 26 annual payments–You’ll be seeing about 192K a year before taxes (unless you take a lump sum, which means half of the money is gone IMMEDIATELY). Last Year, Willard’s investments left him $20 M richer—he sees about 400K a WEEK before taxes. And (as a lotto winner) you’re paying the Joe Schmo tax rate. Willard takes his annual pay in cap gains, which is less than half your rate. There’s a breakdown of all this here, if you care (and if you haven’t won a lottery, why should you?).
One interesting by-product of this is the sniping about the pay for Congresscreatures and the like. And yes, $174K plus perks looks like a lot of money if you work for Denny’s. But when JP Morgan’s Jamie Dimon went to DC to get grilled about massive trading losses at his bank, he was being excoriated by people who make less than 1% what he made last year. Do people like Dimon even have to talk to anyone making what a mere Congressman makes in the course of a business day?
Which brings me back to the Lotto commercials, which imply huge winnings and unlimited horizons. The current Lotto Mega Millions blurb shows a guy with his own airline. The two things it doesn’t show: 1), purchasing the airplane plus the fuel plus the parking place for it would outweigh whatever winnings one could get even from Mega millions; 2) more importantly, as should be obvious to those paying attention, the wealthy don’t pay for their own jets (even the small private ones). Mitt doesn’t have to wait with steerage and take off his shoes and get ‘wanded’ when he wants to fly somewhere because he doesn’t have to pay his own way anywhere. He can hop a corporate jet paid for by one of the many corporations whose board he has worked with. And that’s the thing about the hyper wealthy—they don’t pay for anything. They have a corporate accountant or a non-profit connection that owes them a favor.
All of which brings me back to Lawrence O’Donnell . Last week, Chris Hayes was on the panel on The Last Word remarking on the foreign holdings of Romney and many of the other 1% of the 1%. For Hayes (and perhaps the rest of us) this is an existential question (and I’m paraphrasing): “We no longer have the ability in this country to really tax people at the top… Can you actually tax the people at the top? If you can’t, that is Greece. Societies in decline… cannot tax the people at the top“. Larger point: the problem of moving wealth out of reach of the tax man is endemic in countries like Argentina, where the elites always hide a chunk of their wealth somewhere else so that they can hie to the helicopters should the peasantry get angry enough to tip over the system. Is the US turning into a banana republic?
Sadly, I don’t think Romney need bother worrying about what will happen if people know of his schemes. Despite the empty threats of Obama to the bankers back in 2009, I don’t think there are people with pitchforks ready to take on the uberwealthy and their bankers. The truly desperate are busy with their Lotto Scratch-off games, hoping for Robin Leach’s Champagne Wishes and Caviar Dreams . One just won a thousand dollars a week for life. What he’ll get per year is a bit less than Mitt Romney wakes up to EVERY DAY.