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Saturday, January 28, 2012

!TONGUE LASHING!



A SIMPLE EXPLANATION OF TAXPAYER ABUSE

THE PROCESS

Taxpayers pay taxes to tax collectors.

Next, tax collectors give the taxpayers' money to public (i.e. government) pension funds to fund pensions for public (i.e. government) employees.

Next, the public (i.e. government) pension funds give the taxpayers' money to Hedge Funds, Private Equity Funds, and Real Estate Developers.

Next, the Hedge Funds, Private Equity Funds, and Real Estate Developers invest the taxpayers' money in HIGH RISK investments.


THE GAME: HEADS, WE WIN. TAILS, YOU LOSE.

There are two possible results of those HIGH RISK investments of taxpayers’ money.


POSSIBLE RESULT #1: HEADS, WE WIN.

The Hedge Funds, Private Equity Funds, and Real Estate Developers take a HUGE percentage of the gains if the HIGH RISK investments are successful.

(Furthermore, the Hedge Funds, Private Equity Funds, and Real Estate Developers often ALSO take a "management fee" that is calculated as a percentage of the amount invested (i.e. the fund). The "Management Fee" is paid REGARDLESS of the performance of the HIGH RISK investments).


POSSIBLE RESULT #2: TAILS, YOU LOSE.

The Taxpayers suffer if the HIGH RISK investments are unsuccessful.  The public (i.e. government) pension funds are underfunded if the HIGH RISK investments are unsuccessful. Consequently, the taxpayers MUST, BY LAW, cover the shortage in the public (i.e. government) pension funds because public (i.e. government) employee pensions are taxpayer-guaranteed pensions. 

The Hedge Funds, Private Equity Funds, and Real Estate Developers do NOT cover the losses. Instead, they just get more of the taxpayers’ money from the public (i.e. government) pension funds to play another game of "Heads, We Win. Tails, You Lose." The next round of taxpayers' money comes from tax increases and/or service cuts (e.g. potholes in roads are not repaired, libraries are closed on weekdays). The cycle perpetually repeats.

(Remember, the Hedge Funds, Private Equity Funds, and Real Estate Developers often ALSO take a "management fee" that is calculated as a percentage of the amount invested (i.e. the fund). The "Management Fee" is paid REGARDLESS of the performance of the HIGH RISK investments).


P.S. Furthermore, the taxpayer-guaranteed public (i.e. government) employee pensions are worth astronomically more than any private sector pension.


P.P.S. Persons who have private sector pensions must suffer the consequences of market losses. Nobody covers their losses.


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