F. George McDuffee wrote in
:


As a follow up to my earlier comments in the of-shore sourcing
thread that the US economy becoming so ornate, baroque and arcane
that no one can tell the true cost of anything.

These obscure provisions in the U.S. tax code are exactly what I
am talking about.

Bear in mind that this is not "free" money. In order for one
taxpayer to pay less, another taxpayer must pay more, and/or the
deficit must increase, and/or everyone must do with slightly
fewer services (generally the children and poor).




Very good observation. I totally agree, but am forced to expend my time
and energy in order to play the game I find myself in. sigh So we end
up with more of the same.


Many of our most "successful" major corporations pay no federal
income tax, and indeed many receive "refunds," which segues into
the Ann Lander's question "are we better off with or without
them."



Better off with them. Although the tax loopholes that these companies
exploit are unfair (and IMO should be closed), they create wealth on a
massive scale and are a major factor in our economy's 'money velocity'
(http://nationalreview.com/kudlow/kudlow041602.asp). These factors
combined, although no excuse for shrugging-off their tax burden, do
impact the national economy in a net positive way.


An important but unasked question "Is the US macro economy (i.e.
the general public) better off with marginal (and in too many
cases sub-standard) 'manufacturing' operations with obsolete
equipment/products that show a profit because of their excellence
in tax accounting or with world-class manufacturing operations
which show marginal profits (or even losses) because they pay
their fair share of taxes like everyone else?"


This is an excellent question, directed mainly to the manufacturing
community (and I'd love to hear others sound-off). IMO, I think I'm
better served with the superior manufacturers. In a free-market economy
with the tax burden distributed fairly, they would outperform their
competitors in all aspects of business, would they not? I think it is
self evident that the only way the "marginal (and in too many cases sub-
standard) 'manufacturing' operations" stay in business is on the backs
of the "world-class manufacturing operations." In other words it's a
parasitic relationship.


The free market works only if everyone must play by the same
rules and you can tell what things cost.


I only wish we were in a truly free-market economy. What we really have
is a mixed economy...with more and more every year flowing to the wrong
side of the mix.




--
Robert Davidson
President
Atlas Financial Corporation
877-750-9445