Monday, August 03, 2015

Stealing from the Poor to give to the Rich

The rich are masters of public relations. They masquerade as defenders of the common folk while they continue to plunder them unimpeded.

The Robin Hood Foundation, founded by hedge fund mogul Paul Tudor Jones, boasts 19 billionaires on its leadership boards and committees.

Hedge fund billionaire Steven A. Cohen, who, when he is not being probed for insider trading  (his company, SAC Capital Advisors, pled guilty to securities and wire fraud) is busy throwing parties for himself worthy of a Roman emperor at his Hamptons palace and bragging about his $700 million art collection.

Billionaire Home Depot founder Ken Langone, who threatened to turn off the charity donations if Pope Francis dared to continue criticizing capitalism and inequality, and also likened the plight of the wealthy in America to Nazi Germany. The GOP megadonor doesn’t care for bank regulation and it’s no surprise that he is the main booster for New Jersey Governor Chris Christie’s presidential bid, as his plan to shred Social Security is a fond wish of the tycoon’s.

Hedge fund billionaire Stanley Druckenmiller, funder of right-wing causes who dedicates himself to spreading deficit hysteria and ginning up generational warfare on college campuses by trying to convince young people that they are being robbed by seniors using Social Security and Medicare. A long-time anti-tax crusader and supporter of such anti-labor enthusiasts as Wisconsin Governor Scott Walker, Druckenmiller warned President Obama that any attempt to tax the rich to pay for social services for the poor would be futile.

the Robin Hood Foundation has close ties to an organization called the Managed Funds Association (MFA) that — shocker! —lobbies tirelessly for unjustified tax breaks for hedge funders. Paul Tudor Jones’s top deputy, John Torell, chairs the MFA, and 31 members of Robin Hood’s governing board and leadership committees are executives at firms that belong to the highest membership levels of the organization.

Congress started considering closing the “carried interest” tax loophole which  brought out the heavy artillery of the elites to protect them from paying their fair share. The carried interest loophole is a sneaky ways that the rich use to escape their tax liability”  It works like this: Hedge fund managers brazenly claim they deserve to pay a special low tax rate on the money they earn overseeing the funds they manage because it’s not guaranteed. So they pay 20 percent instead of the 39.6 percent they would pay if the money were taxed as ordinary income. They get very rich from this windfall. But lots of workers have no guarantee about the money they’ll earn, all those whos income is based upon commission, for instance such as car salespeople. Do they get a special tax rate? No, they don’t. They pay the full rate.

This unfair tax break basically allows hedge fund managers to screw their fellow Americans out of money that could do things the illustrious patrons of the Robin Hood Foundation claim are so dear to their hearts, like building schools and feeding the poor. According to a Congressional Research Service cited in the Hedge Clippers report, closing the carried interest loophole would generate $17 billion a year. How many hungry children in New York City could that feed? All of them? The mission statement of the Robin Hood Foundation brays about all the funding it provides for school programs, generating “meaningful results for families in New York's poorest neighborhoods.” Soup kitchens! Homeless shelters! Job training! How far does this largesse actually go toward ameliorating New York’s poverty problem? Unsurprisingly, not very far at all. In fact, the poverty rate in the city has grown over the course of the Robin Hood Foundation’s history, from 20 percent in 1990 to 21.2 percent in 2012. Guess what’s also grown? The bank accounts of 19 billionaires on the Robin Hood Foundation’s boards, which have ballooned 93 percent since 2008. For every dollar the Robin Hood Foundation hedge fund managers studied give to the organization’s antipoverty efforts, they soak up $44 from the public in the form of tax avoidance and anti-tax advocacy, a conservative estimate.

Take the case of Steve Cohen.  The tally of his recent donations to the foundation: $4,850,000. The estimated amount he ripped off the public in 2014 by paying special low tax rates: $1,300,000,000. Quite a difference.

When they aren’t advocating tax swindles, members of the Robin Hood Foundation put in plenty of time fighting fair wages, trying to shred the social safety net, and killing worker protections through their associations with organizations like the Manhattan Institute, the Partnership for New York City (the voice of big business in NYC and a big foe of paid sick leave), and Fix the Debt (a notorious group devoted to crushing Social Security and Medicare).


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