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Written by Jim Jordal   
Saturday, 01 December 2007

A PROFOUNDLY IMMORAL ACT

By Jim Jordal

But as for me, my feet were almost gone. My steps had nearly slipped. For I was envious of the arrogant, When I saw the prosperity of the wicked. For there are no struggles in their death, But their strength is firm. They are free from burdens of men, Neither are they plagued like other men. Therefore pride is like a chain around their neck. Violence covers them like a garment. Their eyes bulge with fat. Their minds pass the limits of conceit. They scoff and speak with malice. In arrogance, they threaten oppression. They have set their mouth in the heavens. Their tongue walks through the earth. Therefore their people return to them, And they drink up waters of abundance. They say, "How does God know? Is there knowledge in the Most High?" Behold, these are the wicked. Being always at ease, they increase in riches.

Psalm 73:2-12 (WEB)

 Then I returned and saw all the oppressions that are done under the sun: and behold, the tears of those who were oppressed, and they had no comforter; and on the side of their oppressors there was power; but they had no comforter. Therefore I praised the dead who have been long dead more than the living who are yet alive. Yes, better than them both is him who has not yet been, who has not seen the evil work that is done under the sun.

Ecclesiastes 4:1-3 (WEB)

Recent news reports point to a profoundly immoral situation in the top echelons of American finance. I refer to the situation in which executives of private equity funds and their counterpart venture capital funds have influenced a compliant congress to grant them tax relief on a monstrous and unnecessary scale.

"Carried interest" is the technical term given to the financial gains of these titans as they "buy, strip, and flip" financially troubled corporations. This income--often reaching billions per year--is taxed at the capital gains rate of 15 percent rather than the normal top tax rate of 35 percent. The result is that the people who clean their toilets pay a far higher tax rate than they do.

According to investigators, this tax advantage saves these CEOs about $6 billion yearly. That wouldn't be so bad except for the fact that the taxes they don't pay either have to be paid by someone else, added to the national debt, or cut from some government program--usually for the poor.

Their reply is of course that without these excessive benefits they would no longer be sure to garner the funds needed to purchase and restructure ailing American corporations. They claim to help stockholders, and pension funds in this way, thereby justifying their exorbitant profits and favorable tax rate. What they don't say is that this financial restructuring (cost containment) is usually at the expense of employees who either lose their jobs or suffer drastic cuts in wages, insurance benefits or retirement plans. So once again average Americans pay the cost. And after the firm again becomes profitable it is offered to the public via the stock market, often at billions in gain to the already rich manipulators.

The most egregious recent example is the Blackstone Group, a private equity firm recently taken public by its founders Peter Peterson and Stephen Schwarzman, who stand to make at least several billion (taxed at 15 percent) from the sale. So they become instant billionaires taxed as if they were paupers. Pretty good work if you can get it!

The Senate is now looking into this travesty as big money moguls flock to Washington to present their cases. But if this tax loophole closes, you can count on new ones opening since it's obvious that money controls what comes out of Washington.

At the same time we have a freeway bridge collapse revealing inadequate care of our national infrastructure, 47 million Americans without health insurance, home foreclosures reaching depths not seen in many years, and job loss and poverty creeping into the middle class. But the rich still clamor for tax relief, and a cooperative political structure provides it. Enough, already!

Now read again what God says. The eyes of the very rich bulge with greed. Their arrogance passes the limits of conceit. They threaten oppression. They mistakenly think that God does not see what they do. And through all this they increase in riches.

And the tears of the oppressed continue as their oppressors gain in power and influence. Therefore, as the writer of Ecclesiastes wails, it is better never to have been born. But God does see, and will soon act to turn the tables as His earthly kingdom draws closer.

Last Updated ( Saturday, 01 December 2007 )