When Titans Talk To Dummies (Part 1 of 3)





by Harvey Golub, Wall Street Journal, 8-22-11.


(Editors note:  Mock The Dummy videos take a long time to make which makes it difficult to respond to the news of the day in a timely manner.  With recognition of this problem, and as an experiment, we would like to offer publication of first this script and then an audio only program.  We ask Mock The Dummy fans to take a breath, access their imagination, hear the tell-tale refrain of bells that signal the start of a video, and let your mind lead you…)

Dummy:  Welcome to my Tea Party.  We dummies always assume that the best way to reach other dummies is on programs that feature dummies – like this one.

But it turns out that those friendly folks at The Wall Street Journal don’t believe that we have a monopoly on the dummies.  They think that some dummies are in their audience too.  How do I know?  Just look at the op ed piece written by Harvey Golub that they published on Monday.  Harvey is no dummy.  But he sure thinks you are.  Harvey can’t be here, but we have a representative dummy, who will read to us what Harvey wrote in My Response To Buffet And Obama.

Tea Party Dummies:  Yippeeeeeeeee!

Golub Dummy:  “Over the years, I have paid a significant portion of my income to the various federal, state and local jurisdictions in which I have lived, and I deeply resent that President Obama has decided that I don’t need all the money I’ve not paid in taxes over the years –

Tea Party Dummies:  Aaaaaaaaah!

Dummy:  Wait a minute.  Obama said that?

Golub Dummy:  Yes.

Dummy:  He said that you don’t need all the money you’ve not paid in taxes over the years?

Golub Dummy:  Well, he didn’t say it.  But we all know he thinks it.

Tea Party Dummies:  Aaaaaaaaah!

Dummy:  What else does he think?

Golub Dummy:  “…That I should leave less for my children and grandchildren and give more to him to spend as he thinks fit.”

Tea Party Dummies:  Aaaaaaaaah!

Dummy:  He wants to spend your money as he thinks fit?

Golub Dummy:  Yes.

Tea Party Dummies:  Aaaaaaaaah!

Golub Dummy:  “I also resent that Warren Buffett and others who have created massive wealth for themselves think I’m “coddled” because they believe they should pay more in taxes. I certainly don’t feel “coddled” because these various governments have not imposed a higher income tax. After all, I did earn it.”

Dummy:  That’s true.  Like in 1997 when you laid off 3,300 employees at American Express and your compensation was $33.4 million dollars.  That must have been a tough year.

Golub Dummy:  Excruciating.  I can’t imagine anyone having a tougher time that year than me.

Dummy:  Me either.

Golub Dummy:  “Now that I’m 72 years old, I can look forward to paying a significant portion of my accumulated wealth in estate taxes…”

Dummy:  Death taxes.

Tea Party Dummies:  Aaaaaaaaah!

Golub Dummy: “…to the federal government and, depending on the state I live in at the time, to that state government as well.”

Dummy:  What do you mean depending on the state you live in at the time?  Wouldn’t it be in your home state?

Golub Dummy:  Well, no.  Who knows which of my homes I will be in when I die?  These things are unpredictable you know, dummy.

Dummy:  That’s true.  I guess that $5 million dollar estate exemption wouldn’t quite pay for the landscaping would it?

Golub Dummy:  It wouldn’t pay for the rosebushes.

“Of my current income this year, I expect to pay 80%-90% in federal income taxes, state income taxes, Social Security and Medicare taxes, and federal and state estate taxes. Isn’t that enough?”

Dummy: Wait a minute….

You’re going to pay 80-90% of your current income this year in taxes?

Golub Dummy:  I expect to.

Dummy:  Which is it?  80% or 90%?

Golub Dummy:  I don’t know … 90%.

Dummy:  You’re going to lose 90% of your income this year to taxes?

Golub Dummy:  That’s what I said, isn’t it?

Dummy:  When the highest marginal tax rate is 35% on adjusted income in the over $379,150 bracket you are going to pay 90% of your income this year to Uncle Sam?

Golub Dummy:  Yes.

Dummy:  How much of your income would go to Uncle Sam if the Bush Tax cuts had expired and that rate had been raised back to 39.6%

Golub Dummy:  I don’t know … 120%.


Golub Dummy:  Yes.

Tea Party Dummies:  Aaaaaaaaah!

Dummy:  So wait a minute.  Although you are retired, I know you get compensated for your various board memberships, and you probably have a fair amount of long term capital gains from dividends and sales of some of your financial assets, and no doubt you take a small salary from Ripplewood Holdings, with the $10 billion in capital under management.  But surely like with most partners in private equity firms the majority of your income comes through carried interest, which is only taxed at 15%.  Do you mean to tell me that the remaining 85% of your earnings from Ripplewood Holdings wasn’t enough to keep you from paying 90% of your income to Uncle Sam?

Golub Dummy:  That’s what I said.

Dummy:  Does this firm have any investors?

Golub Dummy:  Yes.

Dummy:  Are they financially sophisticated?

Golub Dummy:  Yes.

Dummy:  Do they know you’re not making any money?

Golub Dummy: Uh….

Dummy:  This firm hired you?

Golub Dummy:  Yes.

Dummy:  And do they know that despite all of your years running American Express, your chairmanship at American Enterprise Institute, and your time with Dow Jones & Company, former parent company to The Wall Street Journal, you still can’t figure out how to keep from paying 90% of your income to Uncle Sam?!

Golub Dummy:  Yes.

Dummy:  Okay.  Good enough for me.  Dummies, there’s one of our Titans of business.  That’s all we have time for today.

Golub Dummy:  But that was only the first two paragraphs.  It gets much better.

Dummy:  I’m sure it does.  Tune in tomorrow and we will read you more of My Response To Buffet And Obama written specifically for dummies.


Punch … Punch. Punch.

When Titans Talk to Dummies (Part 1 of 3)

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