AMERICAN CORPORATE PROFITS STILL IN DECLINE AND STILL TOO HIGH. SEE THE TRUE PICTURE.

Many continue to tout what ought to be considered a smoke-and-mirrors, propaganda recovery for the American economy.

Today, I give you the true picture of corporate profits. First, this is the picture the Federal Reserve gives you. They report corporate profits in dollars.



And now, I give you the true picture. This is what corporate profits look like after deflating.



Anyone whose been living their adulthood years since the 1990s knows this picture corresponds to their reality while the Fed Res dollars picture tells nothing. Likewise, those were in their primes between 1960 and 1970 knows the truth of my picture. The same holds true for those who were in their primes in the 1980s.

To be sure, whenever True Corporate Profits have been rising, Americans have lived better. This aspect of reality contradicts the false preaching of socialism revivalists like Thomas Piketty.

All-time peak True Corporate Profits hit Q2 2006, leading True Peak GDP and True Peak Credit, which Q4 2007.

It looks like True Corporate Profits are following the trajectory of True GDP though not the rate of decline. Corporate profits are still too high relative to the long run True Average of US$88.60 billion, 1.63 times higher than that average.




So how well does True S&P 500 correspond True Corporate Profits and GDP? Keep in mind that in any year for awhile now, about 45% of revenues for the S&P 500 firms get earned outside the USA.



As it is, a couple of weeks back, I showed you the true picture on SNAP in YELLEN. THE FED, THE LIES, THE FAKE RECOVERY. 46 MILLION NEEDY AMERICANS STILL NEED FOOD STAMPS. How can anyone believe there ever has been a recovery after the collapse of the Greenspan-Bernanke Inflation Bubble, the largest credit bubble in the history of mankind?

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STATE TAX RECEIPTS. THE GOOD. THE BAD. THE UGLY.

The other day in STATE TAX RECEIPTS LAG TRUE GDP. IS THE RECOVERY ON OR NOT?, I revealed to you how personal income, corporate income, sales and total taxes collected by all the states might have increased from after hitting a bottom. If so, this would support the advances in True GDP and True Loans and Leases as I showed in THE USA ECONOMY ADVANCE LIKELY HAS BEGUN AT LONG LAST.

Now, I show you how the various states stack up against each other. First, let's look at states by Individual Burden as measured by the sum of per capita True Income and True Sales taxes paid against those 18 and old in each state.

True Individual Tax Burden (per capita, 18+ in GW$)


The 21 worst states in which anyone could live are these:

1. Connecticut
2. Hawaii
3. Minnesota
4. California
5. New York
6. Massachusetts
7. North Dakota
8. New Jersey
9. Nebraska
10. Maryland
11. Kansas
12. Wisconsin
13. Arkansas
14. Maine
15. Illinois
16. Rhode Island
17. Idaho
18. Indiana
19. Iowa
20. Virginia
21. Utah

The top 21 states' legislators tax their adult citizens so much of these states skew the average. The top 29 least taxing states' legislators with the lowest individual burdens fall below the average.

That Connecticut tops the list fails to surprise me. Only the other day, before running the numbers here, I came across this work by Annie Lowrey, What’s the Matter With Connecticut? 

Though Ms. Lowrey has it right that something is wrong in Connecticut, foolishly, she claims that Thomas Piketty's book has the answer. Of course, regular readers of Bizarro Theater know that born-again socialism revivalist preacher Piketty is quite wrong. For those who have yet to learn why the past creates the future rather than Piketty's expressed foolery — the past devours the future — read these:

• THOMAS PIKETTY, 696 PAGES OF FOOLERY DESTROYED IN LESS THAN FIVE MINUTES
• UT OH, SOMEONE BETTER TELL THOMAS PIKETTY ABOUT L > G TOO.
• MORE BAD NEWS FOR THOMAS PIKETTY P > G TOO!
• THOMAS PIKETTY, REVIVALIST PREACHER OF BORN-AGAIN SOCIALISM. THE SECOND GREAT AWAKENING OF SOCIALISM HAS COME TO AMERICA

When politicians take ever greater unearned shares of profits from individuals, individuals have less to spend. The 186 members of the Connecticut General Assembly are not smart enough to know how to spend better than those 2,821,247 adult Nutmeggers from whom they swiped.

Consequently, inefficiencies build up in the economy, with some goods being over-produced and other goods, under-produced. Worse, unearned buying power gets put into the hands of some who then push up prices than what would otherwise be gained by sellers. Overtime, such meddling leads to a wind-down of the economy as true profits become harder to gain both for firms and individuals.

Here are the top 15 Least Taxing States for imposing individual burdens.

1. Alaska
2. New Hampshire
3. Montana
4. Texas
5. Florida
6. South Dakota
7. Alabama
8. Tennessee
9. Louisiana
10. Nevada
11. Arizona
12. Wyoming
13. Delaware
14. South Carolina
15. Georgia

And now, here is the map of True Personal Income Tax paid.

True Personal Income Tax Paid, 18+ in GW$


Not surprisingly, the list for highest personal income tax burdens appears quite alike to the list of individual tax burdens.

Here are the 21 worst states in which anyone could live:

1. Connecticut
2. New York
3. Massachusetts
4. California
5. Minnesota
6. Oregon
7. Delaware
8. New Jersey
9. Virginia
10. Maryland
11. Illinois
12. Hawaii
13. Nebraska
14. Wisconsin
15. Utah

And here are the top 9 best states by least personal income tax:

1. Alaska
2. Florida
3. Nevada
4. South Dakota
5. Texas
6. Washington
7. Wyoming
8. Tennessee
9. New Hampshire

Moving on, let's look at the True Sales Tax burden. Right, because if legislators don't get you one way, they get you another.

True Sales Tax Burden (per capita, 18+ in GW$)


Of the two, income tax or sales, I prefer sales tax. An income tax is an unearned share of profits for which legislators have not invested any capital either in firms or workers. Thus, an income tax is highly anti-capitalistic.

When a sales tax is borne by the buyer, it is up to the buyer to decide whether or not to pay the toll to legislators to enjoy goods bought from the fruits of work sold in purchases and sales of work for cash or credit. Such a tax is a wealth tax.

When a sales tax is borne by the seller, and in some states this is the method even though customers fail to know this and fall prey to the seller pushing the tax upon the buyer, such a tax also is anti-capitalistic, as it is a levy against capital.

For more on the kinds of taxes that exist in life, check out IF YOU DRIVE A CAR, I'LL TAX THE STREET. IF YOU TRY TO SIT, I'LL TAX YOUR SEAT. MR. WILSON. MR. HEATH. Also, you should read, ELITES SEEK TO PUNISH WORKERS WITH A CONSUMPTION TAX, OR A TAX ON WORKERS' WEALTH.

Here are the 20 worst states whose legislators levy the true highest sales taxes while also burdening the citizens with personal income taxes.

1. Hawaii
2. North Dakota
3. Connecticut
4. Mississippi
5. Tennessee
6. Indiana
7. Arkansas
8. Kansas
9. New Mexico
10. Minnesota
11. New Jersey
12. Nebraska
13. California
14. Idaho
15. Maine

That Hawaiian legislators lead this list fails to surprise. When you are stuck on an island with most goods being imported over seas and you need those goods to live, you will do what you need to do to get those goods.

Here are the states whose legislators levy sales taxes but no personal income taxes.

1. Washington
2. Wyoming
3. Nevada
4. South Dakota
5. Florida
6. Texas

The legislators of Alaska neither levy sales tax nor personal income tax.

Now, let's see how states' legislators treat their fictional personhood friends. 

True Corporate Income Tax Paid, per firm in GW$


Straight away, I acknowledge that presenting these figures suffer a small flaw. The firm count as reported in the Statistics of U.S. Businesses by the Census Bureau, though the latest figures available, only runs through 2011. Nonetheless, it's fairly accurate.

Here are the states whose legislators treat firms the worst.

1. Alaska
2. New Hampshire
3. Illinois
4. Massachusetts
5. North Dakota
6. Delaware
7. California
8. New Jersey
9. Tennessee
10. Mississippi
11. Minnesota
12. Pennsylvania
13. Connecticut
14. New York
15. Kentucky
16. Wisconsin
17. Maryland
18. New Mexico
19. Nebraska

Likely, the legislators of Alaska and North Dakota sock it to oil and nat gas drillers. 

And here are the states with the lowest corporate tax burden, falling in the top 25% lowest.

1. Nevada
2. Texas
3. Washington
4. Wyoming
5. Ohio
6. South Dakota
7. Missouri
8. Rhode Island
9. Montana
10. Michigan
11. Florida
12. Virginia
13. Oklahoma

This last map reveals the True Corporate Income Tax to Individual Burden Ratio. To make the map, the states of Alaska and New Hampshire have been excluded.

The New Hampshire ratio is 24 times higher than the next closest state's legislators, Tennessee. Alaska is 10 times New Hampshire as Alaskans lack an individual burden of sales and personal income taxes.

True Corporate Income Tax Paid (per firm) to True Individual Tax Burden (per capita, 18+) in GW$


You can think of this map revealing a proxy for competitiveness among the states' legislatures.

Here are the states falling above the average whose legislators like tax corporate entities higher than citizens.

1. Tennessee
2. Delaware
3. Illinois
4. Mississippi
5. Pennsylvania
6. Massachusetts
7. Kentucky
8. New Jersey
9. North Dakota
10. Louisiana
11. North Carolina
12. Florida
13. California
14. Montana
15. Alabama
16. New Mexico
17. West Virginia
18. Wisconsin
19. South Carolina
20. Indiana
21. Arizona
22. Minnesota
23. Maryland

And here are the states falling below the average.

1. Nevada
2. Texas
3. Washington
4. Wyoming
5. Ohio
6. South Dakota
7. Hawaii
8. Missouri
9. Rhode Island
10. Connecticut
11. Maine
12. Virginia
13. Michigan
14. Idaho
15. Oklahoma
16. Utah
17. Oregon
18. Iowa
19. New York
20. Nebraska
21. Kansas
22. Colorado
23. Vermont
24. Arkansas
25. Georgia

True Total Taxes Paid, per capita in GW$

When accounting for other taxes such as licenses, here are the top states with the lowest total taxes levied per capita whose legislators beat the average.

1. New Hampshire
2. Florida
3. Alabama
4. Georgia
5. Missouri
6. Arizona
7. South Carolina
8. South Dakota
9. Tennessee
10. Texas
11. Louisiana
12. Colorado
13. Virginia
14. North Carolina
15. Ohio
16. Oregon
17. Oklahoma
18. Utah
19. Idaho
20. Kentucky
21. Michigan
22. Iowa
23. Nevada
24. Mississippi
25. Montana
26. Indiana
27. Kansas
28. Pennsylvania
29. Washington
30. Nebraska
31. Rhode Island
32. Maine
33. New Mexico
34. Wisconsin
35. West Virginia

And overall, here are the worst states in which anyone could live.

1. North Dakota
2. Connecticut
3. Vermont
4. Minnesota
5. Hawaii
6. Wyoming
7. Alaska
8. New York
9. California
10. Massachusetts
11. Delaware
12. New Jersey
13. Maryland
14. Arkansas
15. Illinois

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CORPORATE PROFITS IN A BUBBLE! PAID CORPORATE TAXES NEAR LOWS

Federal Reserve Bank Units (FRBUs), or if you like better, Federal Reserve Buying Units are what circulate goods and services in the U.S.A. and elsewhere on earth.

In ELECTRICITY PRICES. SHOCKING, ISN'T IT? THANKS, NIXON, I explain that Richard Nixon, then president of the U.S., through Executive Order 11615, closed the gold window, which put Americans on fiduciary bank credits as money system and thus the world on a floating exchange rate scheme for international trade settlement. It is these fiduciary bank credits which constitute Federal Reserve Bank Units.

In INFLATION REVEALED! "REAL GDP" AND FEDERAL RESERVE BANK UNITS, I reveal how using the FRBU deflator give the best measure of inflation. 

As can be see with your eyes, both before-tax and after-tax corporate profits are in a bubble.

Between Q3 1971 and Q4 2001, the before tax profit averaged $130.20 billion in GWD, the after tax profit averaged $87.85 GWD and the taxes paid averaged $43.36 billion GWD. The taxes paid to after tax profit ratio was a whopping 49.35%!

Since Q1 2002,  the before tax profit average $211.28 billion in GWD, the after tax profit average $161.10 billion GWD and the taxes paid averaged $50.18 billion GWD. The taxes paid to after tax profit ratio was a 31.15%

Average after tax profit has grown 83.38% and taxes paid as grown 15.7% while before tax profit has grown 61%.

Corporate Taxes, in billions Gold Window Dollars (GWDs) using FRBU-deflator

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ME AND MY AEREO

I grew up in the era when broadcast TV came to my TV free. If the rabbit ears style telescoping antenna that came with my TV couldn't pick up signals, then an antenna attached to the chimney would do the job.

Today, about two-thirds of Americans stupidly pay for television each month. These stupid Americans fail to see the true price they pay is much higher as every show watched excludes all other shows from being watched. The true price goes higher when one adds a personal video recorder into the mix.

Paying to watch advertising always seemed insane to me. I can not see paying $100 a month to watch commercials and miss 99.9% of what gets aired because time conflicts.

Now, there is a Barry Diller backed firm that could make Americans smarter again. It's called Aereo.

Aereo is too cool. You rent an antenna and rack space for your antenna from them. That antenna sits in a data center connected to the Internet. Then you control your antenna through your Internet connection.

The latest psy-opery pulled by jokers of mainstream media upon Americans is that Aereo is “a service that lets users record broadcast TV shows over the internet and stream the recording to their mobile devices.” Of course, that is a lie.

Aereo is a landlord that rents land (rack space) with installed antennas to tenants who want antennas erected on their rented land rather than upon their own houses, software to control their antennas and hard disk drive space to store data from free-by-law, over-the-air broadcast signals their antennas pick up.

If you prefer, Aereo is both a landlord — space rented for an antenna — and an equipment rental business, like U-Haul, United Rentals or Home Depot Rentals — the antennas. 

That is all Aereo is. To see it any other way is to reject reality.

Many if not most rented houses and apartment houses come with equipment, like stoves, refrigerators, heating systems, air cooling systems, plumbing systems and the like. No one would suggest selling property in rentals and equipped rentals should be banned.

Aereo shows what free-market competition in action should look like. Aereo is what is supposed to happen under competition. Firms with inefficient capital structures — cable TV and satellite TV — should go out of business.

Today, the U.S. Supreme Court robes heard oral arguments in a case against Aereo brought by anti-competitive, mainstream media deadbeats. In a sane America, Aereo should withstand any legal challenge, as federal regulation requires broadcast spectrum licensees to provide free-of-charge access to broadcasts.

All Aereo is doing is taking the High-def antenna off my roof and renting me space for it. That seems like a titanium legal lock.

However, idiot Chief Justice Roberts threw out many hundreds of years of Anglo-American jurisprudence as well as English by claiming a fine is tax for the now infamous ruling justifying abomination that is Obamacare.

Outside of the NFL Sunday Ticket and Super Rugby, TV broadcasters fail to provide content to a guy like me. The fifteen thousandth variation of hook-up reality TV, vote-him-off-the-island reality TV or make-over reality TV fails to appeal to me. 

Since 1993, I have gotten my news from the Internet. I stopped my trade journal subscriptions by 1999. 

Aereo might convince me to rent rack space and an antenna. 

Americans get made to be stupid by incessant indoctrination through public education, first through public schooling, which is the substrate and then through mainstream media, which reinforces beliefs the political establishment want everyone to accept.

To see how the equipment of Aereo works, check out:



All of this reminds of me of a Nilsson song from an animated feature titled The Point.

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THE PROPERTY-DESTROYING VIOLENCE OF NET METERING

Today, in Forbes, Tim Worstall typed a piece advocating an end to net metering.

Worstall supports the silly, faux argument that solar consumers "don’t pay to maintain the power grid." Worse, Worstall dresses that silly argument in the fallacy of appeal to emotion by claiming "they’re not paying their fair share of ... fixed costs."

Net metering ought to end, but not for the lame argument that Worstall makes. Net metering ought to end because such arrangement abrogates property of electricity firms and their freedom to contract.

Suppliers of oil, coal and of natural gas to electricity generators don't pay to maintain the power grid. Yet, no one argues that electricity firms ought to have the right and thus oil, coal and natural firms should have the duty to pay for the costs electricity firms incur to transmit electricity from plants to cities.

Instead, electricity firms buy oil, coal and natural gas to fuel their plants. Firm execs decide what fuel sources to buy depending upon market prices and what fuels their plants can burn.

Because of net metering, residential and commercial customers who generate excess electricity from solar installs supply already-generated electricity to electricity firms whose executives are required by law to buy.

Worstall's silly claim that those with solar only contribute to overhead when sucking power off the grid is akin to saying that if you only shop in Kroger's, Safeway or Publix once a month, you are contributing to the overhead of their physical stores, but you don't buy enough for those firms to profit upon you, thus you should be banned from shopping at all at those stores.

In trade, all firms get held to the great Axiom of Profit and the infrangible Law of Prices. The Axiom of Profit holds the sum of sales must at least equal the cost of production otherwise firms go to ruin. The Law of Prices holds the winning bids of purchase and sale for what is on offer set the price.

The sum of sales for electricity sellers comes from rate payers and not from suppliers of fuel used to generate electricity. It is from the sales of electricity to rate payers that electricity-selling firms pay their expenses. If they have planned their businesses right, they might break even.

A better argument to end net metering would be thus:

1. Executives of electricity firms cannot know how much solar install exists at any time, nor can these executive know how much sun shall shine over a futures contract period for oil or natural gas, nor how efficient the production of electricity from solar shall be during this period. 
2. Times of solar abundance pushes higher the true price electricity firms have paid already for oil, coal and natural gas, thus increasing costs and reducing the likelihood of break even.
3. Thus, executives cannot forecast and mitigate risks to insure break even. 
4. Therefore, executives should not be forced to deal with commercial and residential customers who wish to sell their excess electricity to their local utility.

Wal-Mart execs aren't forced by law to buy products from any wholesaler nor any manufacturer. No franchise in the NFL is forced to draft any player nor contract with any player. Forcing any electric utility to do the same violates their freedom of contract, freedom of association and their property in capital and property in wealth.

Worstall makes his silly argument based on the faux science of economics. In WHY IS THE ECONOMY SO HORRIBLE? BECAUSE ACADEMIA ECONOMICS IS FAKE, I show how trade of property for profit is the only basis upon which anyone can discuss trade or commerce or authentic economics.

Americans need to come to understand that there isn't "The Grid." "The Grid" is pure fiction that politicians spin on behalf of electric utilities hoping to get Americans to subsidize the capital of these firms, thus increasing their unearned profit.

There are firms, which sell electricity to residential and commercial customers. There are firms, which own and operate high voltage transmission lines connected by towers. There are firms that own electrical generation power plants, which buy the services of transmission-line operators in the same way that manufacturers hire long-haul truckers to haul goods to wholesalers and wholesalers hiring the same to haul goods to retailers. In the past, firms did all three — generate, transmit and sell.

Americans do not own "the Grid" in the same way that Americans do not own the U.S. Interstate highway system. Congress owns the U.S. Interstate highways.

Congress imposes the duty on you to pay taxes for the Interstates. Congress gives itself the right to collect taxes from you. Congress gives you the right to travel the Interstates. Congress imposes the duty upon itself to let you travel the Interstates.

Firms run transmission lines from more than one power plant, which are the sources, to the same city, which is the sink. This is done to ensure that electricity stays running in case of failure at any power plant.

If you don't know what net metering is, the Energy Policy Act of 2005, a federal law, requires all public electric utilities to facilitate net metering to their customers upon request.  Net metering requires electricity firms to accept electricity generated by commercial and residential customers through renewable methods, such as solar panels, and then reduce bills of these customers by the amount of electricity they have generated.

If you don't know what property means, property means ownership, a bundle of rights — right for possession (Jus Possidendi), right for using (Jus Utendi), right for destroying, alienating (Jus Abutendi), right for recovery when found in the wrongful possession of another (Jus Vindicandi).

Property means the right of ownership and never the thing owned.

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DID THE OIL TRAIN EXPLOSION HAPPEN BECAUSE OBAMA DENIED CONSTRUCTION OF THE SAFER KEYSTONE XL PIPELINE?

Thirteen died after a runaway train carrying crude oil set off a series of explosions and flattened a downtown. An estimated 100,000 liters of oil spilled into the nearby river.

For more on the debate over dangerous train shipping versus safer Keystone XL, check out what the greenies say here:

Here is the story from the CBC.

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