The Tide May Be Turning (Slightly)

Two weeks ago I wrote an article saying that Obama won re-election primarily because people are hurting much more than Republican politicians realize -  from the effects of the housing crash and from the incredible and dangerously unfair distributions of wealth and income now taking place in America. Obama won because he articulated this unfairness while leading Republicans kept saying that they will never raise taxes on the wealthy, and Mitt Romney never came to grips with the issue.

When 1% of our population has 37% of America’s private wealth, while 40% of the population has only 3/10 of 1% of the wealth, something is very wrong – even to a conservative Republican like me. To his discredit, President Obama never explained the situation, never worked to change it, and instead used class warfare to batter Republicans.

All of a sudden, due to the fiscal cliff that faces us, some Republicans, at least 16, are indicating a willingness to raise income tax rates on wealthier Americans, not because of the unfairness issue, but because of the deficit and the need to make some compromises to get Obama to agree to some spending cuts. There are two dangers facing Republicans: 1. one is that the cuts will be future cuts that, as usual, will never materialize, and 2. recent polls indicate that Republicans will be blamed if a real bargain is not reached. As discussed here, rates on higher incomes need considerable upwards adjustments. This has nothing to do with the needs of the federal budget, but obviously will help in the efforts to balance it.

I’ve gotten some angry e-mails from readers who tend to be conservatives since my posts are usually very conservative in nature. These readers are of two schools: 1. that what I am saying is socialism, or 2. that raising rates on earned and investment incomes will cause an economic slowdown since lowering rates has often caused an upturn.

As to point 1. my answer is that when something is wrong, it should be corrected, and I don’t care what it is called. On point 2., unless rates are increased to levels in effect from 1932 to 1981, I don’t believe raising them will have much effect on economic activity.

History of income tax rates adjusted for inflation
---------Top ----- Top -------- In 2011
Year -- Rate --- Bracket ----  Dollars -- Comment
1913 --- 7% ---- $500,000 -- $11.3M First income tax

1917 -- 67% -- $2,000,000 -- $35M World War I financing

1925 -- 25% ---- $100,000 -- $1.28M Post war reductions

1932 -- 63% -- $1,000,000 -- $16.4M Depression era

1936 -- 79% -- $5,000,000 -- $80.7M

1941 -- 81% -- $5,000,000 -- $76.3M World War II

1942 -- 88% ---- $200,000 --- $2.75M Revenue Act of 1942

1944 -- 94% ---- $200,000 --- $2.54M Tax Act of 1944

1946 -- 91% ---- $200,000 --- $2.30M

1964 -- 77% ---- $400,000 --- $2.85M

1965 -- 70% ---- $200,000 --- $1.42M

1981 -- 70% ---- $212,000 ---- $532k Reagan tax cuts

1982 -- 50% ---- $106,000 ---- $199k Reagan tax cuts

1987 -- 38.5% -- $90,000 ----- $178k Reagan tax cuts

1988 -- 28% ---- $29,750 ----- $56k Reagan tax cuts

1991 -- 31% ---- $82,150 ---- $135k

1993 -- 39.6% - $250,000 --- $388k
2003 -- 35% ---- $311,950 --- $380k Bush tax cuts

2011 -- 35% ---- $379,150 --- $379k

NY Times Front Page from 1943

Five times since, in 1947, the year that the United Nations declared that Israel is a sovereign nation, the Palestinians, joined by countries including Iran, Iraq, Syria, Lebanon, Jordan, Egypt and Sudan – and heavily financed by oil-rich countries of the Persian Gulf, have attacked Israel with the intention of exterminating all the Jews.

Each time they have been defeated and withdrawn with their tails between their legs, and lost territory, some of which has been exchanged for promises of peace.

In between actual wars, the Palestinians have plotted and planned and carried out various intifadas during which murderous attacks on Israeli citizens were the order of the day. In the latest episode, hundreds of rockets, originating in Iran and launched from Gaza have rained down on Israel. The Israelis, after protesting to the UN to no avail, react with retaliatory raids designed to take out the rocket launchers and the Hamas leadership in Gaza.

As each of these periods of terror initiated by the Palestinians is met with force, the New York Times springs into action with articles lambasting the Israelis for defending themselves and lamenting the plight of the poor Palestinians who were wounded or killed in the self-defense, retaliation raids. Some of the Palestinian casualties came as the result of their policy of locating the rocket launchers among homes, hospitals and mosques.

The only explanations I can think of for this policy of the Times is anti-seminism on the part of the owners of the Times, and the fact that they are liberals with a warped sense of values with respect to Israel and Muslim terrorism.

Some one thought this NY Times page from 1943 perfectly reflected the situation:

Left-click Twice to Enlarge



Warren Buffet Is Right

For a couple of years now, I have ridiculed Warren Buffet and the so-called Buffet Rule. Now that I’ve looked at the data, I have to admit Buffet is right, and if my fellow Republicans don’t wake up to the inequities that have developed in America, we and they are doomed.

A Minimum Tax for the Wealthy

By WARREN E. BUFFETT November 25, 2012 NY Times

SUPPOSE that an investor you admire and trust comes to you with an investment idea. “This is a good one,” he says enthusiastically. “I’m in it, and I think you should be, too.”

Would your reply possibly be this? “Well, it all depends on what my tax rate will be on the gain you’re saying we’re going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent.” Only in Grover Norquist’s imagination does such a response exist.

Between 1951 and 1954, when the capital gains rate was 25 percent and marginal rates on dividends reached 91 percent in extreme cases, I sold securities and did pretty well. In the years from 1956 to 1969, the top marginal rate fell modestly, but was still a lofty 70 percent — and the tax rate on capital gains inched up to 27.5 percent. I was managing funds for investors then. Never did anyone mention taxes as a reason to forgo an investment opportunity that I offered.

Under those burdensome rates, moreover, both employment and the gross domestic product (a measure of the nation’s economic output) increased at a rapid clip. The middle class and the rich alike gained ground.

So let’s forget about the rich and ultrarich going on strike and stuffing their ample funds under their mattresses if — gasp — capital gains rates and ordinary income rates are increased. The ultrarich, including me, will forever pursue investment opportunities.

And, wow, do we have plenty to invest. The Forbes 400, the wealthiest individuals in America, hit a new group record for wealth this year: $1.7 trillion. That’s more than five times the $300 billion total in 1992. In recent years, my gang has been leaving the middle class in the dust.

A huge tail wind from tax cuts has pushed us along. In 1992, the tax paid by the 400 highest incomes in the United States (a different universe from the Forbes list) averaged 26.4 percent of adjusted gross income. In 2009, the most recent year reported, the rate was 19.9 percent. It’s nice to have friends in high places.

The group’s average income in 2009 was $202 million — which works out to a “wage” of $97,000 per hour, based on a 40-hour workweek. (I’m assuming they’re paid during lunch hours.) Yet more than a quarter of these ultrawealthy paid less than 15 percent of their take in combined federal income and payroll taxes. Half of this crew paid less than 20 percent. And — brace yourself — a few actually paid nothing.

This outrage points to the necessity for more than a simple revision in upper-end tax rates, though that’s the place to start. I support President Obama’s proposal to eliminate the Bush tax cuts for high-income taxpayers. However, I prefer a cutoff point somewhat above $250,000 — maybe $500,000 or so.

Additionally, we need Congress, right now, to enact a minimum tax on high incomes. I would suggest 30 percent of taxable income between $1 million and $10 million, and 35 percent on amounts above that. A plain and simple rule like that will block the efforts of lobbyists, lawyers and contribution-hungry legislators to keep the ultrarich paying rates well below those incurred by people with income just a tiny fraction of ours. Only a minimum tax on very high incomes will prevent the stated tax rate from being eviscerated by these warriors for the wealthy.

Above all, we should not postpone these changes in the name of “reforming” the tax code. True, changes are badly needed. We need to get rid of arrangements like “carried interest” that enable income from labor to be magically converted into capital gains. And it’s sickening that a Cayman Islands mail drop can be central to tax maneuvering by wealthy individuals and corporations.

But the reform of such complexities should not promote delay in our correcting simple and expensive inequities. We can’t let those who want to protect the privileged get away with insisting that we do nothing until we can do everything.

Our government’s goal should be to bring in revenues of 18.5 percent of G.D.P. and spend about 21 percent of G.D.P. — levels that have been attained over extended periods in the past and can clearly be reached again. As the math makes clear, this won’t stem our budget deficits; in fact, it will continue them. But assuming even conservative projections about inflation and economic growth, this ratio of revenue to spending will keep America’s debt stable in relation to the country’s economic output.

In the last fiscal year, we were far away from this fiscal balance — bringing in 15.5 percent of G.D.P. in revenue and spending 22.4 percent. Correcting our course will require major concessions by both Republicans and Democrats.

All of America is waiting for Congress to offer a realistic and concrete plan for getting back to this fiscally sound path. Nothing less is acceptable.

In the meantime, maybe you’ll run into someone with a terrific investment idea, who won’t go forward with it because of the tax he would owe when it succeeds. Send him my way. Let me unburden him.

Barbarians at the Gate

As Christians around the globe prepare to celebrate Christmas, we have to realize that the barbarians are at the gate, and the gate has been weakened significantly. The gate is weak because of several recent situations:

1. President Obama’s luke-warm and sometimes dithering support for Israel, 2. the sea-change occurring in Turkey from the secular government established by Ataturk to one controlled by religious (Muslim) fanatics, 3. the impending Muslim Brotherhood/Al Qaeda takeover in Syria, 4. the Muslim Brotherhood takeover in Egypt, and, 5. last but not least, Iran’s implacable march toward nuclear weapons.

If civilization ever needed a show of support against the barbarians, it is now.

Israel Vs. Hamas Is Civilization Vs. Savagery

11/21/2012 Investors Business Daily

Mideast: Celebration within Gaza after the bombing of a bus filled with innocent Israeli civilians is an object lesson on the so-called Palestine question. Those who would celebrate such a cowardly act are savages.

No one can imagine Washington's troops firing shots to celebrate a supporter of American independence trying to kill a group of Royalist civilians. During the Cold War, U.S. support for Lech Walesa's Solidarity would have dried up if he handed out candy after a Polish nationalist targeted, say, innocent Muscovites going to work.

We may live in a complex world, but evil is identifiable even when its practitioners claim their cause is good.

The gunfire across Gaza celebrating an explosion on a bus in central Tel Aviv on Wednesday is evil. And the Iranian-backed Hamas' rulers praising the bombing, which injured 15 passengers, is evil.

"Hamas blesses the attack in Tel Aviv and sees it as a natural response to the Israeli massacres ... in Gaza," Hamas spokesman Sami Abu Zuhri told Reuters.

The "Israeli massacres," i.e. self-defensive airstrikes, are exactly how the U.S. would react if, let's say, Mexico were doing to us what Hamas has been doing to Israel: firing hundreds of rockets into populated areas.

It is, in fact, what any civilized nation would be doing.

But only barbarians would hand out cakes in celebration of the bombing of a vehicle with innocent men, women and children, which was happening at Gaza's main hospital on Wednesday. "Go back to Germany, Poland, Russia, America and anywhere else," Hamas' al-Qassam brigades warned Jews on Twitter.

Hamas' al-Aqsa TV, run by a Palestinian parliament member, is already notorious, encouraging children to become terrorists, as when it depicted a 4-year-old girl holding an explosive, singing of killing Israeli soldiers as a suicide bomber. On Wednesday, the channel's news reader prayed "to Allah the exalted that we see body bags in a short while" and joyfully reported that "the morale of Gaza residents is in the sky right now."

As Chaim Weizmann, Israel's first president, wrote over 60 years ago, "The real opponents of Zionism can never be placated by any diplomatic formula: Their objection to the Jews is that the Jews exist, and in this particular case, that they exist in Palestine."

Arthur James Balfour, author of the 1917 Balfour Declaration supporting a Jewish homeland, in 1904 as British prime minister was humming another tune, crusading against Jewish immigration into Britain.

But, as Conor Cruise O'Brien observed, even Balfour came to appreciate the "tremendous Jewish contribution" to the world, and ultimately saw "a Jewish Palestine as the focus for a new blaze of human creativity, a new enrichment of the culture of the world."

Then, as now, Israel represented civilization. Its Arab enemies dependably exemplify its bloodthirsty opposite.

Obama Holds All the Cards

Articles are appearing about the budget and tax negotiations now underway between the Republican House and President Obama – with Obama wanting higher income taxes on the wealthy, and the House wanting to retain the Bush tax cuts – and both sides wanting to avoid the draconian cuts hovering in the near future. Speaker Boehner keeps saying that the House will never accept higher income tax rates.

This, of course, is hogwash. These columnists and Boehner are forgetting the 20 new taxes already embedded in Obamacare, a program whose implementation is now inevitable. The largest tax increases on investors hit on January 1, 2012, with the maximum capital gains tax going from 15% to 23.8%, and the maximum dividends tax going from 15% to 43.4% (the steep increases assume the basic rates revert to pre-Bush rates with a new 3.8% surtax on incomes over $200,000). This one Obamacare set of taxes is expected to raise $123 billion a year.

I would expect that the House will end up accepting an increase in ordinary income taxes on the wealthy in return for the continuation of existing rates on capital gains and dividends. That would result in maximum rates of 18.8% on both types of investment income.

The area that is an unknown is what will happen with estate taxes. If nothing is done, the current exemption of $5,120,000 and maximum rate of 35% will change to $1,000,000 and 55% on January1, 2012.

Taking into account the concerns I discussed here and here over the extreme and dangerous concentrations of income and wealth that have developed over the past few years in America, I would like to see increases in income tax rates and on investment tax rates on the wealthiest Americans, but I am not talking about an income of $200,000 as is Obama. I would like to see income taxes and investment taxes raised on individuals making $1,000,000 or more. That would begin to resolve some of the inequities that have occurred lately.

I would also like to see a continuation of approximately $5,000,000 exempted from estate taxes, special provisions made for business ownership and family farms that would prevent their forced sale, and a steep, progressive set of tax rates on huge estates.

Full List of Obamacare Tax Hikes

Obamacare law contains 20 new or higher taxes on American families and small businesses

Taxpayers are reminded that the President’s healthcare law is one of the largest tax increases in American history.

Obamacare contains 20 new or higher taxes on American families and small businesses.

Arranged by their respective effective dates, below is the total list of all $500 billion-plus in tax hikes (over the next ten years) in Obamacare, where to find them in the bill, and how much your taxes are scheduled to go up as of today:

Taxes that took effect in 2010:

1. Excise Tax on Charitable Hospitals (Min$/immediate): $50,000 per hospital if they fail to meet new "community health assessment needs," "financial assistance," and "billing and collection" rules set by HHS. Bill: PPACA; Page: 1,961-1,971

2. Codification of the “economic substance doctrine” (Tax hike of $4.5 billion). This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed. Bill: Reconciliation Act; Page: 108-113

3. “Black liquor” tax hike (Tax hike of $23.6 billion). This is a tax increase on a type of bio-fuel. Bill: Reconciliation Act; Page: 105

4. Tax on Innovator Drug Companies ($22.2 bil/Jan 2010): $2.3 billion annual tax on the industry imposed relative to share of sales made that year. Bill: PPACA; Page: 1,971-1,980

5. Blue Cross/Blue Shield Tax Hike ($0.4 bil/Jan 2010): The special tax deduction in current law for Blue Cross/Blue Shield companies would only be allowed if 85 percent or more of premium revenues are spent on clinical services. Bill: PPACA; Page: 2,004

6. Tax on Indoor Tanning Services ($2.7 billion/July 1, 2010): New 10 percent excise tax on Americans using indoor tanning salons. Bill: PPACA; Page: 2,397-2,399

Taxes that took effect in 2011:

7. Medicine Cabinet Tax ($5 bil/Jan 2011): Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). Bill: PPACA; Page: 1,957-1,959

8. HSA Withdrawal Tax Hike ($1.4 bil/Jan 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent. Bill: PPACA; Page: 1,959

Tax that took effect in 2012:

9. Employer Reporting of Insurance on W-2 (Min$/Jan 2012): Preamble to taxing health benefits on individual tax returns. Bill: PPACA; Page: 1,957

Taxes that take effect in 2013:

10. Surtax on Investment Income ($123 billion/Jan. 2013): Creation of a new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single). This would result in the following top tax rates on investment income: Bill: Reconciliation Act; Page: 87-93

Capital Gains Dividends Other*

2012   15%          15%        35%
2013+ 23.8%       43.4%     43.4%

*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations. It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income. It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans. The 3.8% surtax does not apply to non-resident aliens.

11. Hike in Medicare Payroll Tax ($86.8 bil/Jan 2013): Current law and changes:

First $200,000 ($250,000 Married) All Remaining Wages
Employer/Employee

Current Law 1.45%/1.45%               1.45%/1.45%
          2.9% self-employed

Obamacare Tax Hike 1.45%/1.45%      1.45%/2.35%
           3.8% self-employed
Bill: PPACA, Reconciliation Act; Page: 2000-2003; 87-93

12. Tax on Medical Device Manufacturers ($20 bil/Jan 2013): Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax. Exempts items retailing for <$100. Bill: PPACA; Page: 1,980-1,986

13. High Medical Bills Tax ($15.2 bil/Jan 2013): Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI). The new provision imposes a threshold of 10 percent of AGI. Waived for 65+ taxpayers in 2013-2016 only. Bill: PPACA; Page: 1,994-1,995

14. Flexible Spending Account Cap – aka “Special Needs Kids Tax” ($13 bil/Jan 2013): Imposes cap on FSAs of $2500 (now unlimited). Indexed to inflation after 2013. There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. Bill: PPACA; Page: 2,388-2,389

15. Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D ($4.5 bil/Jan 2013) Bill: PPACA; Page: 1,994

16. $500,000 Annual Executive Compensation Limit for Health Insurance Executives ($0.6 bil/Jan 2013). Bill: PPACA; Page: 1,995-2,000

Taxes that take effect in 2014:

17. Individual Mandate Excise Tax (Jan 2014): Starting in 2014, anyone not buying “qualifying” health insurance must pay an income surtax according to the higher of the following

1 Adult 2 Adults 3+ Adults

2014 1% AGI/$95 1% AGI/$190 1% AGI/$285
2015 2% AGI/$325 2% AGI/$650 2% AGI/$975
2016 + 2.5% AGI/$695 2.5% AGI/$1390 2.5% AGI/$2085

Exemptions for religious objectors, undocumented immigrants, prisoners, those earning less than the poverty line, members of Indian tribes, and hardship cases (determined by HHS). Bill: PPACA; Page: 317-337

18. Employer Mandate Tax (Jan 2014): If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees. Applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer). Bill: PPACA; Page: 345-346

Combined score of individual and employer mandate tax penalty: $65 billion/10 years

19. Tax on Health Insurers ($60.1 bil/Jan 2014): Annual tax on the industry imposed relative to health insurance premiums collected that year. Phases in gradually until 2018. Fully-imposed on firms with $50 million in profits. Bill: PPACA; Page: 1,986-1,993

Taxes that take effect in 2018:

20. Excise Tax on Comprehensive Health Insurance Plans ($32 bil/Jan 2018): Starting in 2018, new 40 percent excise tax on “Cadillac” health insurance plans ($10,200 single/$27,500 family). Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions. CPI +1 percentage point indexed. Bill: PPACA; Page: 1,941-1,956

Obama Is Right, Part II

I shocked quite a few people last week when I wrote an article advocating some redistribution of wealth in this country because the concentration of income and wealth has become enormously unfair and widely misunderstood. I believe President Obama was re-elected mainly because he understood and articulated the need for reform, which has become urgent due to the tremendous loss of wealth (mostly by the lower 80%) caused by the housing crash.

I am disgusted with Obama that he made no attempt to explain this situation or work to correct it. He only used the anger of millions to batter Republicans who, like Speaker John Boehner and Minority Leader Mitch McConnell, kept stupidly saying, “no increase in taxes on the wealthy”.

We not only need to reduce spending and reform entitlements, we need to make our income tax system more progressive and also enact a steeply progressive estate tax system – both without the loopholes that very wealthy people use to escape taxes. See my post on this here.

The 99% mostly get it, though, even if most Republicans don’t (including me before I was challenged to do some research).

They “get” it even though they misunderstand the extent of the problem. Below is a quote from an exceptional report which I used for most of my data:

“A remarkable study (Norton & Ariely, 2010) reveals that Americans have no idea that the wealth distribution (defined for them in terms of "net worth") is as concentrated as it is. When shown three pie charts representing possible wealth distributions, 90% or more of the 5,522 respondents -- whatever their gender, age, income level, or party affiliation -- thought that the American wealth distribution most resembled one in which the top 20% has about 60% of the wealth. In fact, of course, the top 20% control about 85% of the wealth.

Even more striking, they did not come close on the amount of wealth held by the bottom 40% of the population. It's a number I haven't even mentioned so far, and it's shocking: the lowest two quintiles hold just 0.3% of the wealth in the United States. Most people in the survey guessed the figure to be between 8% and 10%, and two dozen academic economists got it wrong too, by guessing about 2% -- seven times too high. Those surveyed did have it about right for what the 20% in the middle have; it's at the top and the bottom that they don't have any idea of what's going on.

Americans from all walks of life were also united in their vision of what the "ideal" wealth distribution would be, which may come as an even bigger surprise than their shared misinformation on the actual wealth distribution. They said that the ideal wealth distribution would be one in which the top 20% owned between 30 and 40 percent of the privately held wealth, which is a far cry from the 85 percent that the top 20% actually own. They also said that the bottom 40% -- that's 120 million Americans -- should have between 25% and 30%, not the mere 8% to 10% they thought this group had, and far above the 0.3% they actually had.”

Another misconception that most people have is that “the very wealthy are already paying their fair share because our tax system is very progressive”. In fact our tax system has become much less progressive over the past few decades, and in fact the top 1% actually pays less in total taxes than the next lower grouping.

Source: Citizens for Tax Justice (2010a).
Left-Click to Enlarge

An argument that conservatives make that has some validity is that “raising income taxes on the job creators is self-defeating since they will be less motivated to invest and work to create more jobs”.

My response to this is threefold:

1. Federal income tax rates have decreased in recent years and are much less punitive of success than they once were.

2. I was a successful small businessman for many years. NOT ONCE DID I CONSIDER TAXES WHEN DECIDING ON NEW EQUIPMENT OR ON EXPANDING. THE EXISTENCE OF A MARKET AND THE OPPORTUNITY FOR PROFITS WERE WHAT MOTIVATED ME.

3. When I worked for a large corporation and analyzed investment opportunities, only when competing projects outnumbered available funds were income taxes considered in a present-value analysis of projects.  That was when corporate tax was 50%.

When income taxes became prohibitive, it is true that when they were lowered, an increase in economic activity and jobs immediately followed. This happened under Kennedy, Reagan and Bush 43. I can’t ever remember when the opposite was true; that is, when raising taxes reduced economic growth. That certainly didn’t happen during Clinton’s presidency, although other factors were also at work then. No-one wants to see a huge increase in income tax rates, but some upward adjustments are absolutely necessary.

I believe that most liberals believe what they do basically from guilt (if they are wealthy) or from hatred caused by envy of success (today’s Democrats are much different than the Truman-Kennedy school). However, once in a while they are right about something, and they tend to be more creative than we conservatives. Social Security was a liberal idea. Without it most of our seniors would be living in abject poverty. The right to bargain collectively was a liberal idea. Without it there would be no middle class. Don’t reject the idea of trying to even out the extremes of capitalism just because it is a liberal concept.

Here We Go Again

A headline in this morning’s Sun Herald infuriated me.

It screamed, “Israel strikes residential area”. For decades Arabs in surrounding countries (and Iran) have been trying to exterminate the Israelis, and only a short time ago the Palestinians were murdering Jews during their various Intifadas. Whenever the Israelis try to defend themselves, liberals and their corrupt press post article after article about the bloodthirsty Israelis.

During the last actual warfare, both Reuters and the Associated Press were caught red-handed fabricating stories and pictures that made Israelis look like monsters. I know that reporters fear for their lives when in Muslim countries, but they should quit their profession or change where they choose to work – rather than feed us this anti-Semitic nonsense.

Everyone with even a cursory knowledge of Gaza knows that they hide behind women and children when they locate their rocket launchers. They place them near homes, hospitals and mosques. What are Israelis to do when hundreds of rockets are raining down on them?

Not too long ago the Israelis twice made trades of “land for peace”. Returning the Sinai to Egypt brought a peace that resulted in the assassination of Anwar Sadat (a peace that is threatened now by the takeover in Egypt by the Muslim Brotherhood), while giving Gaza to the Palestinians has resulted in no peace, just periodic intervals of terror and bloodshed initiated by Arab terrorists who call themselves, Hamas. When they are not figuring out ways to kill more Jews, they are teaching their children that Jews are actually pigs that drink the blood of Arab children during their religious ceremonies.

Bias by the Numbers

Leo Rennert November 18, 2012 American Thinker

Pick up the Sunday, Nov. 18 edition of the Washington Post and you'll find a lengthy, front-page wrap-up about Israel's antiterrorist counteroffensive in Gaza -- with three perfect examples of pro-Palestinian, anti-Israel bias. all within eight paragraphs of each other ("GAZA CLASH WIDENS -- Israel expands air assault against Hamas, says Tel Aviv-bound rocket was intercepted" by Karin Brulliard and Abigail Hauslohner).

Here they are by the numbers:

1) Brulliard and Hauslohner devote half a dozen paragraphs to a heart-tugging, up-close and personal account of two Gaza teachers awakened by the family's windows shattering and their walls bursting open. The house next door, which belonged to a Hamas commander, sustained a direct hit. One of the teachers "frantically dug his five children out of the rubble." The other teacher "rushed from room to room, crying and gathering her children's clothing, school bags and dolls." The Post quotes her as saying again and again, "Where are we going to go? The Israelis are responsible. They are the enemy of God. What did we do? Did we carry any missiles? Did we launch any rockets?" All very poignant. But what about similar scenes in Israel, where Hamas rockets by the hundreds have been pounding civilian targets from Ashkelon, Ashdod, and Netivot to the proximity of Tel Aviv and Jerusalem? Do Brulliard and Hauslohner devote as much space to cameos of Israelis, especially children, suffering from shock and post-traumatic stress? Does their suffering also rate half a dozen paragraphs of sympathetic coverage? If not six paragraphs, how about three... or maybe just one paragraph? Or a single despairing quote? But in the entire Post article, there isn't a single sentence depicting Israelis frantically rushing to shelters as sirens blare at any time of day -- or the traumas left in their wake. Nothing, nada. As Shakespeare might have protested: "If you prick us, do we not bleed?"

2. Brulliard and Hauslohner, writing about Israeli air strikes that demolished a Hamas police building and the headquarters of Hamas prime minister Ismail Haniyeh, conclude that "Israel appeared to be channeling new efforts toward Hamas civilian institutions." Hamas headquarters a "civilian institution"? It is nothing of the sort. The terrorist group has a unitary command-and-control apparatus and infrastructure. This is where all the terrorist plots are hatched under single command. But the Post, long known for its predilection to sanitize Hamas, presents them as "civilian" facilities that presumably should remain untouched. How touching -- for beleaguered Hamas, with Brulliard and Hauslohner to the rescue of this terrorist outfit.

3) And what about fatalities on either side? Here's the article's take: "The death toll in Gaza rose to 45 by Saturday evening, Health Ministry officials said. Three Israelis have been killed by rocket fire from Gaza." Forty-five dead "Palestinians" versus three dead "Israelis." The numerical comparison, however, is highly misleading. It's apples and oranges. On the Israel side, the three fatalities were civilians -- a reflection of Hamas aiming its massive rocket barrages at civilian populations. On the Gaza side, however, Israeli air strikes are carefully and deliberately aimed at terrorists, their arms caches, ammunition, and rocket launchers. Yes, there are collateral fatalities, but only because Hamas and other terror groups in Gaza hide amid civilians and use them as ''human shields.'' Estimates of combatant-versus-noncombatant fatalities in Gaza are beginning to trickle in. Early figures show most of them were combatants engaged in terrorist operations. To bundle civilian and terrorist fatalities into a single statistic leaves readers with a false impression that perhaps most or all of those killed Gazans were civilians -- the very opposite of what's really happening there. Bottom line: Washington Post readers beware. This isn't kosher journalism.

Obama Right about Something Important

My fellow conservatives will probably label me a traitor for what I am going to say in this article. I have tried to analyze the results of the recent election, which, at first, were inexplicable to me. I initially concluded that the reason for Romney’s defeat lay in the corrupt media and the disintegration of America’s society. These reasons were valid but not the main reason for the election result. I also concluded that the onslaught of negative ads against Romney and most Republicans was decisive. Again, this factor was important, but not decisive.

The main reason for the Republican defeat was that Obama was right about one very important aspect of American life: the growing and now vast inequality of incomes and wealth that has developed in America over the last few decades – an inequality that became excruciating for millions of our citizens when housing values, the main repository of wealth for most Americans, collapsed.

This kind of inequality, which I will describe shortly, was a fact of life at the turn of the last century. It led to the trust-busting that made Teddy Roosevelt a hero, and to the breakup of Standard Oil and of the US Steel Company. Inequality peaked in 1928 and then ameliorated greatly up until the late 1970’s, when it began to reverse and take on steam. The wealth inequality ratios that existed in the 1920’s have returned and exist today. One example of this is that average CEO pay was 40 X average factory pay in 1976. In 2008, average CEO pay was 400 X average factory pay. This is immoral and unsustainable.

Left-Click to Enlarge

In 2007 the richest 1% of the American population owned 34.6% of the country's total wealth, and the next 19% owned 50.5%. Thus, the top 20% of Americans owned 85% of the country's wealth and the bottom 80% of the population owned 15%. Financial inequality was greater than inequality in total wealth, with the top 1% of the population owning 42.7%, the next 19% of Americans owning 50.3%, and the bottom 80% owning 7%. However, after the housing bubble burst, which started to happen in 2007, the share of total wealth owned by the top 1% of the population grew from 34.6% to 37.1%, and that owned by the top 20% of Americans grew from 85% to 87.7%. The Great Recession also caused a drop of 36.1% in median household wealth but a drop of only 11.1% for the top 1%, further widening the gap between the 1% and the 99%.

We Republicans don’t like the idea, but some sort of wealth and income redistribution is absolutely necessary for America to become a more-just society. We are approaching the environment in which Marie Antoinette, when told the poor have no money for bread, supposedly said, “Let them eat cake”. We need much higher income taxes, and we need steep, progressive estate taxes on the 1%. We also need to return to a 20% capital gains tax.

Many millions of Americans are hurting badly; a large number of them actually have a negative net worth. They are hurting, they are resentful, and they are angry. They don’t care about Benghazi, Fast and Furious or Solyndra, and they will NEVER vote Republican again if Republican leaders don’t shut up about never raising taxes on the rich and instead cooperate in a workable approach to lessen the inequality that exists.

I had no idea that American society had reached such a state until my doctor made a comment that caused me to do some research. Most of my data is contained in a report by Professor G. William Domhoff of the University of California at Santa Cruz. Before you call me a communist, read this report. I am carrying no water for President Obama, whom I detest. It is outrageous that, knowing of this situation, he only uses it to score political points and wasted four years while it worsened noticeably.

Canadian View of Petraeus

Cover-up at 1600 Pennsylvania Avenue

By Doug Hagmann Monday, November 12, 2012 CanadaFreePress

Obama was aware of the CIA director's indiscretions "long before" the November 6, 2012 elections, and knew about the FBI's investigative findings weeks before the election.


According to two well-vetted sources with intimate knowledge of the CIA operations and events in Benghazi, the resignation of CIA Director David Petraeus is directly related to the testimony he was expected to provide before a closed-door hearing next week before the Senate Intelligence Committee. Sources close to the controversy, citing the need for anonymity due to their positions, stated that Barack Hussein Obama was aware of the CIA director’s indiscretions “long before” the November 6, 2012 elections, and knew about the FBI’s investigative findings weeks before the election, but “erected a firewall” to prevent any disclosure before November 6th.

“What I do know is that an integral part of that firewall involved having information on Petraeus that would potentially damage his career, legacy and marriage. A sort of political blackmail, if you will. What I don’t know, but suspect, is that Petraeus was placed in the unenviable but self-inflicted position of having to choose between providing truthful testimony under oath and having his professional and personal life destroyed while systematically being impeached due to this incident, or keeping quiet before the Senate Intelligence Committee,” stated one source.

A second intelligence source stated that “the announcement [of Petraeus’ resignation] was carefully timed. It was announced in a Friday afternoon news dump three days after the election, and days before the Senate Intelligence Committee was to hear his testimony, despite the President having knowledge of these events weeks ago. Friday’s announcement served two purposes; it kept controversy from emerging before the election, while allowing the administration to buy time regarding testimony by a federal official about CIA’s involvement in Benghazi.”

The resignation of David Petraeus is merely one, albeit a very high-profile one, of several coordinated moves to push any meaningful investigation into the events of Benghazi well into the future. “Obama and other high ranking officials learned many valuable lessons from Fast & Furious,” a fact agreed upon by both sources. Fast & Furious is the name given to the gun running operation from the U.S. into Mexico. “They understand that the longer they can delay and obstruct the truth, reassign key personnel with important information to positions and locations that hinder any meaningful investigation, the more the public interest wanes. As the public loses interest, it also takes the pressure off Congress from getting to the bottom of things.”

Both sources agreed that it is difficult to speculate whether Petraeus decided to extract himself from the leverage that the controversy had over him by the Obama regime on his terms, or whether his resignation was conducted solely by the terms of the Obama regime. Otherwise, both sources agreed that his resignation would buy the administration some valuable time, and the change in status of Petraeus as the active CIA director would also have an effect on the manner in which he is required to provide testimony before the Senate Intelligence Committee. The change of status, from an active CIA official and government employee, to a citizen bound by far reaching confidentiality agreements, would change his ability to testify before the committee. “He can also lawyer-up,” added one source.

According to another CIA source, the resignation of Christopher Kubasik, president and CEO-elect of defense and aerospace company Lockheed Martin, announced on the same day as Petraeus, might have ties to the events at 1600 Pennsylvania Avenue. “There is a relationship between Lockheed Martin and the defense department, as well as the CIA, that ties into current events in Turkey and Syria. This is particularly relevant in the operation taking place in Benghazi and when investigation into where the ‘black-ops’ money went. Don’t forget, Congress appropriated money, at the behest of Obama, for humanitarian aid, not weapons.”

Like Petraeus, Kubasik cited an “inappropriate relationship” for his resignation. “The timing is beyond coincidental, and the operation much too big for this to be merely coincidental.”

Both intelligence sources interviewed for this report agree that there is an exceptional cover-up campaign taking place. “All roads lead to Benghazi, and this cover-up is exponentially bigger than anything we’ve seen in Watergate and the Iran-Contra Affair combined. The American people are being lied to at every turn, and the Obama administration has become emboldened by the election results and a disinterested media.”

Go Negative Young Man

Both John McCain and Mitt Romney fought principled campaigns in which they implored their followers to stay positive, and stay on the high ground. They were afraid of being called, “racists”.

With this and $1.50 you can get a cup of coffee.

We are now seeing all kinds of analyses of why Romney lost. It is very simple. Negative campaigning works. Too bad. Obama won versus both men by sliming them in every way he and his operatives could think of, and by dividing Americans and urging them to blame their problems on the people who invest and provide jobs.

We have lost America; by that I mean that respect for all the values that made America great have been lost. Combat soldiers, even Americans, soon learn that the only thing that matters is to stay alive and win – even if you have to fight dirty. Isn’t America worth fighting dirty for?

We should have gone negative too; not just a few bloggers and low-level operatives, but from the top down. This is where we are being beaten. Certainly we had the material:

Obama is incompetent.
Obama is a liar.
Obama is a racist.
Obama has hidden and camouflaged his past.
Obama has hidden and camouflaged his associates.
Obama has hidden and camouflaged his philosophy.
Obama is a closet Muslim.
Obama is the first president to turn his back on Americans under fire when he could have saved them.

We didn’t even have to lie to go negative.

Next time let’s make sure our standard bearer is willing to get down in the muck with the Democrats and fight with every weapon at hand.

Worse Than the Shah

Although Jimmy Carter found out fast that there was something far worse than the Shah of Iran, liberals generally believe that, in the Muslim world, dictators like Mubarek, Assad and Gadofi need to go.

Conservatives, on the other hand, generally believe that dictators who are driven by the need for power and wealth are much better for their people and for the peace of the area than a sham democracy. We believe that those driven by a 7th century religion and culture are much more dangerous for everyone, and that true democracy is difficult to achieve in such a setting.

Saddam Hussein was a notable exception to this rule because he was a constant threat to his neighbors, had used weapons of mass destruction and was trying to rebuild his nuclear weapons program.

Revolutions have occurred recently in Egypt, Libya and Tunisia, and is one is underway in Syria. It is clear that US support for the revolutionaries has backfired as the role of the Muslim brotherhood becomes clearer, and perhaps even the Obama Administration is holding back in Syria as the true motives of the rebels begin to emerge.

With the weakness that the United States is now showing, and with the growing power of people committed to dragging the world back to the 7th century, I see nothing but big trouble ahead. I hope it does not come to a widespread war, but that is what I see happening in the next two or three years.

Having plenty of powder and keeping it dry has always been a wiser course than groveling.

I Was Wrong and Why

The corrupt, mainstream press and a rotting, anything-goes-if-it- feels-good population combined to re-elect a failed president. Life, liberty and the pursuit of happiness isn’t good enough anymore. Now it’s free food, free condoms, tax-payer funded abortions, and the continued elevation of Muslims, here, and around the world. Someone once said that the way to get out of the mess in Vietnam was to declare victory and get out. That has been our policy toward Islamic terrorists for the last four years – pretend they don’t exist anymore.

I guess we can’t count on the Hand of God anymore; maybe He can only help so much (or maybe He can only TAKE so much).

My sister, who needs my continuing financial support, voted for Obama. When I questioned her, she knew nothing about Benghazi and hadn’t heard of Fast and Furious, Solyndra, the planned destruction of Medicare or the regulation forcing Catholics to pay for abortion insurance. The next time she needs help maybe I should tell her to ask Obama (I won’t; I’m a Christian, and she’s family.)

I am serious, though, about my need to conserve my savings for when all the good doctors abandon Medicare, and the Chinese stop financing our Social Security.

The policy of denying the existence of Islamic terrorists has forced the families of the Fort Hood massacre victims to take legal action.

Fort Hood shooting victims sue government, accused shooter

By Jim Forsyth Mon, Nov 5 2012 Reuters

SAN ANTONIO (Reuters) - Families and victims of a mass shooting in 2009 at the Fort Hood military base in Texas filed a wrongful death suit on Monday against the U.S. government, the accused gunman and the estate of an alleged al Qaeda leader.

The 148 plaintiffs are seeking damages and a ruling that the rampage was a terrorist attack. The finding would clear the way for them to receive benefits.

Major Nidal Hasan, an Army psychiatrist, faces 13 charges of premeditated murder and 32 counts of attempted premeditated murder for the November 5, 2009, attack on soldiers preparing to deploy to Iraq.

Survivors have expressed frustration about repeated delays over the past three years in bringing Hasan to trial. The U.S. Court of Appeals for the Armed Forces indefinitely postponed Hasan's court-martial last month pending further review.

The suit filed in U.S. District Court in the District of Columbia alleges that Defense Secretary Leon Panetta and other officials disregarded the safety of soldiers and civilians at Fort Hood. It also alleges that they allowed Hasan to be in a position to open fire on the troops despite knowing he was a "radical extremist."

"The government seems to have gone out of its way to give the stiff arm to these victims. They have made their lives miserable," said attorney Neal Shur, who is the lead counsel in the case.

The lead plaintiff is Shawn Manning, who was an Army staff sergeant three years ago and was shot six times.

"The Army has refused to acknowledge this was a terrorist attack, and I have exhausted all other options," he said.

The other defendants include Hasan, who was shot by police during the attack and paralyzed from the chest down, and the estate of Anwar al-Awlaki, a U.S.-born cleric linked to al Qaeda's Yemen-based wing. He was killed in a U.S. drone strike last year.

An independent review headed by former FBI Director William Webster found that Hasan had exchanged emails with Awlaki.

The lawsuit includes allegations of civil conspiracy, gross negligence, assault and battery, due process violations and intentional misrepresentations.

Shur said one reason the suit was filed was that federal authorities had "ignored" $750 million in administrative claims he sought in 2011.

The Benghazi-Oslo Syndrome

If you independents and progressives think that a fair and impartial investigation of the tragic Benghazi fiasco is forthcoming, think again.

This group wouldn’t know the truth if it bit them.

Islamophobia Is the Underlying Cause of Benghazi

Richard Butrick November 3, 2012 American Thinker

So sayeth Ambassador Pickering, Hillary Clinton's appointee to head the "Accountability Review Board." Ambassador Pickering is tasked with getting the facts straight (after the election) about what happened in Benghazi and where accountability resides.

According to Ambassador Pickering, in remarks he made during an Oct. 23 panel discussion at the National Cathedral in Washington, D.C., America is a seething hotbed of "Islamophobia," filled with ignorant racist rubes who irrationally fear the benign Muslim religion. Of course, he couched his message in diplomatese. "Ignorant rubes," in diplomatese, becomes "[d]ata shows that those Americans who do not know Muslims, who do not know much about Islam, are the ones who harbor the greatest feelings of prejudice."

So we can see that Hillary appointed a man who comes into the investigation with an open mind and without preconceived scapegoats.

The real stupefying bafflement in all this is how someone with the experience and acumen of an ambassador can believe such suicidal pap. It is like battered wife syndrome, in which the wife believes that it is somehow her fault. The brutal behavior of her husband is really love gone awry because of her failings. For Pickering, Islam is a religion of peace, and all the hate, outrage, and violence rained down upon us just proves that it is our fault. It is a strange, malignant, suicidal idée fixe that controls his mind (and Hillary's and Obama's?) no matter what transpires.

The evidence is overwhelming. Fourteen hundred years of Islamic brutal suppression, domination, and enslavement of all non-Islamic cultures in North Africa and the Near East and even the Balkans means nothing. The hate-filled spewing from imams, mullahs and ayatollahs from mosques all over the world means nothing.

A just recently published 70-minute documentary entitled The Grand Deception, produced by award-winning journalist Steve Emerson, shows how the radical Brotherhood's tentacles have reached deep inside the U.S. political system over the past few decades. Emerson was able to obtain footage of the leaders of the peace-loving Brotherhood speaking candidly behind closed doors. While Brotherhood representatives dupe the Clinton-Obama team with assurances of commitment to religious freedom, democracy, rule of law, and pluralism, behind their backs they snicker at Western values and consider it all "garbage." The Emerson footage showed them praying in Congress or breaking bread in the White House as "peace-loving moderates," then revealed them just days later, damning America and calling for violent jihad against us and our allies.

The Clintonites and Pickeringites are so far gone in what one author calls the "Benghazi-Oslo Syndrome" that even forced viewing wouldn't dent their bulletproof mental blinders. The zombie Islamodupes need to be run out of town.

Blood on His Hands

President Roosevelt had to leave the Americans trapped in the Philippines to the savagery of the Japanese, but I don't know of any other president who watched while Americans died, and not only could have done something about it, but could have prevented it in the first place.

‘YOU HAVE THE BLOOD OF AN AMERICAN HERO ON YOUR HANDS’

By U-T San Diego Editorial Board October 31, 2012 U T San Diego

What did President Barack Obama know and when did he know it? Why has the Obama administration kept changing its story about how Ambassador Chris Stevens, security officials Tyrone Woods of Imperial Beach and Glen Doherty of Encinitas, and information officer Sean Smith, who grew up in San Diego, died on Sept. 11 in Benghazi, Libya? Why won’t the mainstream media treat the incontrovertible evidence of the White House’s dishonesty and incompetence like the ugly scandal it obviously is?

These are all questions that demand to be answered after revelations that demolished the tidy narrative the president has been offering about Benghazi.

Until last week, the White House had taken a moderate hit over the fact that for two weeks after it happened, officials had fostered the impression that the four Americans were killed Sept. 11 in a spontaneous protest triggered by a blasphemous anti-Islam video posted on YouTube – not by a coordinated terrorist attack on the 11th anniversary of 9/11. But administration officials pushed back by saying the “fog of war” had left them uncertain about events, and that when White House press secretary Jay Carney and U.N. Ambassador Susan Rice had cited the video, they were only repeating the best available information they had. The president’s repeated comments conveyed the impression that he wasn’t aware of the attacks as they were unfolding, saying only that the next day, he ordered increased security for embassies in the area.

But after a torrent of leaks of official emails and communiqués – likely coming from CIA officials who refuse to participate in a cover-up and/or who won’t accept the role of scapegoat – the “fog of war” narrative looks like damage control: a determined attempt to keep the facts from the public until after the Nov. 6 election. After the leaks, the president suddenly changed his story to say he was aware of the attacks as they unfolded and had quickly issued an order to “make sure that we are securing our personnel and doing whatever we need to.”

There was no “fog.” There was no spontaneous uprising. Thanks to a drone and other surveillance technology, the White House’s national security team knew in real time that the U.S. consulate and a “safe house” a mile away in Benghazi were under coordinated attack by a well-armed group, not from a protest that unexpectedly escalated. Over a seven-hour span on Sept. 11, the besieged Americans made at least two urgent requests for help; the U.S. military has considerable assets in the area that could have been deployed to Benghazi.

Who told the besieged Americans they were out of luck?

After hints appeared in the media that it was the CIA’s fault, the spy agency – obviously at the behest of CIA Director David Petraeus – put out a statement Friday that flatly denied it opposed coming to the rescue of Stevens, Young, Doherty and Smith. At roughly the same time, in a TV interview, the president offered his new narrative of being aware of the crisis and taking decisive action, while refusing to answer the direct question of whether Americans in Benghazi requested help but were rejected. A day later, however, the White House said in fact that it had never received requests for help. This sets up the Pentagon to take the fall.

On Monday, incredibly, Obama acted put-upon by the questions about his administration’s integrity. In a TV appearance, he said, “I do take offense with some suggestion that in any way, we haven’t tried to make sure that the American people knew as the information was coming in what we believed.” Remember, the president made this statement only after leaks the previous week demolished his and his administration’s dishonest, intentionally misleading Benghazi narrative.

It has now been seven weeks since the terrorist attack. We deserve to know the truth. Charles Woods, father of Tyrone Woods, the former Navy SEAL from Imperial Beach, said it best in a Monday TV interview.

“I can’t imagine anyone with any heart that would watch a battle rage for seven hours knowing that heroes were there that were going to be slaughtered if you didn’t have help sent in. ... Whoever it was that was in that room watching that video of my son dying, their cries for help, their order ‘don’t help them at all, let them die’ ... you have the blood of my son, you have the blood of an American hero on your hands. I don’t know who you are, but one of these days the truth will come out.”

The senior Woods is correct. Inevitably, there will be a bipartisan fact-finding commission into this terrible tragedy and its cover-up.

Unless the mainstream media stops abetting the cover-up and the facts come out without a commission wielding subpoena power.

Isn’t this a story – a gigantic story?

Of course. But we fear that ABC, CBS, NBC, CNN, The New York Times and The Washington Post will only choose to realize how obvious this is after Nov. 6. Then it will come to them – spontaneously, we’re sure.

Those of us who have followed this imperial presidency are quite sure that we understand perfectly what happened: Obama's ideology with regard to Muslims in general and to Muslim terrorists (they don't exist any more) and political calculations and timing led first to the decision not to improve security, and then to the decision to look away - and then lie about everything.