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COMPASSION with dignity, humour, and tolerance..
KNOWLEDGE with effort, perseverance and sharing..
LOVE with peace and harmony towards all
LIFE ON EARTH.
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Thursday, January 14, 2016
1. Intelligence is a wonderful thing! 2. Feedback loops. 3. Index.
A repeat article with some great ideas for 2016!
Gentle Citizens of the World:
Intelligence is a wonderful thing! It allows human beings to compete for food and territory with each other and with the other species on this planet. Also, and because of our intelligence, we survive better and more comfortably than do animals who are living in the wild and who are attempting to co-exist with us. Unfortunately because of our intelligence, we have beaten and killed and dominated the other species into near extinction! Many species including our beautiful Lions and Elephants and Tigers are losing the struggle for basic survival while we humans proliferate into the billions. The few solutions we have attempted to create in order to slow our human birth rate have been disallowed by our prolific religious world leaders and a majority of our world politicians who unfortunately are not, in most part, educated in basic science. All the other species are now subject to us! The trees and plants and microbes and germs and viruses are not excempt. Humans, however, are only temporary masters on this planet. Unlike the other life forms we humans are destructive to the natural environment and in consequence, to ourselves. I am ashamed to be a human who is forced to witness the ignorant and selfish destruction of life on Earth! I am willing to share this planet and to help protect all life forms on this planet and I refuse to be pushed off this planet by polluters and pollution created by my own species!
We Homo Sapiens have created tools and guns and ways to murder each other and as many other species as have the temerity to exist or stand in our way! We are foolishly and ignorantly proud of our so-called "industrial progress" and rampant industrialism is destroying not enhancing life on Earth. For one example gas burning cars continue to fly-off Robot dominated world assembly lines at the rate of Forty Two cars an hour. If industrial progress involved the protection and enhancing of life on Earth I would not feel the need to write these words!
I now ask you, on behalf of the other species who cannot ask, to please create and enforce stronger anti-pollution laws and to actively work to save the natural environment of this planet!
Please create and place economic value on products that help nature and do not destroy nature. Please reward those humans who create life enhancing products and stop economically rewarding those who create products that pollute and harm life on Earth! That would include guns and bombs, fossil fuels and gas burning cars and destructive chemicals and industrial products that do us all harm! Please slow or stop the Media advertising of such destructive products!
We humans are highly intelligent and we can use our collective imaginations for creating cities filled with flower gardens and trees and roof-top green houses. Cities filled with Bicycle paths and Electric vehicles and quick non-polluting mass transit systems. We certainly can use our half empty office buildings at night for creating living spaces for homeless people and for plants and even for small animals. We must ban the internal combustion engines from our city streets and destructive fossil fuels and polluting chemicals from our lives. We do have wonderful alternatives ready for use.
We can improve our mass transit systems and we must lower Electric Bus fares for the poor and elderly who are the ones left out and behind when you speak about growing the middle class.
We can create buildings that allow for quiet rooms where people could go and sit and relax without the mind disturbing incessant noise now permeating large shopping malls. You can even place shopping-malls under ground and place large Geodesic Domes filled with plants and trees and small animals above the shopping malls.
You can do all of these wonderful things or you can do nothing and watch as nature, now polluted by humans, silently turns against life on Earth.
Thanks for reading this letter!
Joseph Raglione
Executive director: The World Humanitarian Peace and Ecology Movement. --------------------------------------------------------------------------------------------------
Warning! Positive feedback loops are dangerously accelerating.
Stop poking the beast with a gas powered stick!
Scientists are aware of a number of positive feedback loops in the climate system. One example is melting ice. Because ice is light-colored and reflective, a large proportion of the sunlight that hits it is bounced back to space, which limits the amount of warming it causes. But as the world gets hotter, ice melts, revealing the darker-coloured land or water below. The result is that more of the sun's energy is absorbed, leading to more warming, which in turn leads to more ice melting – and so on. Today, melted Glaciers around the world are proof positive of this effect.
Various other feedbacks – related to emissions from soils and permafrost, from Volcanos and from industrial plants, from animal Methane and from forest fires as well as fossil fuel burning vehicles and ocean evaporation, are today measured by precise instrument satellites providing evidence of the ongoing crisis! Polluters around the world can no longer deny the evidence of a planet in crisis. If we do not stop the polluters and the pollution fast enough the world's children will suffer the consequences in the very near future!
Feedback loops are complex in themselves and become more complex when considered as part of an integrated global climate system. Some are already dangerously accelerating while others have yet to kick in. Others still – both positive and negative – may yet be discovered. Today's evidence of positive feedback loops coupled with historical evidence of rapid climate change, led one prominent climate scientist to compare releasing greenhouse gases into the air with "poking a beast with a sharp stick".
I mention this because internal combustion cars continue to fly off the assembly lines at the rate of one every minute. The makers of these machines have chosen to ignore the signs of dangerous climate change. They are gambling against the science-based evidence and are sacrificing the near future, not the distant future, the near future for quick present gain. On behalf of my generation I apologize to the children and grandchildren for the ecological disasters we are leaving for them! I sincerely hope we can avoid the worst of these disasters by changing our attitudes quickly enough towards life sustaining and not life destructive economic systems.
Intelligence is a wonderful thing! It allows human beings to compete for food and territory with each other and with the other species on this planet. Also, and because of our intelligence, we survive better and more comfortably than do animals who are living in the wild and who are attempting to co-exist with us. Unfortunately because of our intelligence, we have beaten and killed and dominated the other species into near extinction! Many species including our beautiful Lions and Elephants and Tigers are losing the struggle for basic survival while we humans proliferate into the billions. The few solutions we have attempted to create in order to slow our human birth rate have been disallowed by our prolific religious world leaders and a majority of our world politicians who unfortunately are not, in most part, educated in basic science. All the other species are now subject to us! The trees and plants and microbes and germs and viruses are not exempted. Humans are masters of the planet! I am ashamed to be a human who is forced to witness the destruction of other life forms! I am willing to make room and to protect the other life forms on this planet and like the other life forms, I refuse to leave this planet willingly!
We Homo Sapiens have created tools and guns and ways to murder each other and as many other species as have the temerity to exist or stand in our way! We are foolishly and ignorantly proud of our so-called "industrial progress" and that industrial progress has been destroying and not enhancing life on Earth. If it were the other way around I would not feel the need to write these words!
I now ask you, on behalf of the other species who cannot ask, to please create and enforce stronger anti-pollution laws and to actively work to save the natural environment of this planet!
Please create and place economic value on products that help nature and do not destroy nature. Please reward those humans who create life enhancing products and stop economically rewarding those who create products that pollute and harm life on Earth! That would include guns and bombs, fossil fuels and gas burning cars and destructive chemicals and industrial products that do us all harm! Please slow or stop the Media advertising of such destructive products!
We humans are highly intelligent and we can use our collective imaginations for creating cities filled with flower gardens and trees and roof-top green-houses. Cities filled with Bicycle paths and Electric vehicles and quick non-polluting mass transit systems. We certainly can use our half-empty office buildings at night for creating living spaces for homeless people and for plants and even for small animals. We must ban the internal combustion engines from our city streets and destructive fossil fuels and polluting chemicals from our lives. We do have wonderful alternatives ready for use.
We can improve our mass transit systems and we must lower Electric Bus fares for the poor and elderly who are the ones left out and behind when you speak about growing the middle class.
We can create buildings that allow for quiet rooms where people could go and sit and relax without the mind disturbing incessant noise now permeating large shopping malls. You can even place shopping-malls under ground and place large Geodesic Domes filled with plants and trees and small animals above the shopping malls.
You can do all of these wonderful things or you can do nothing and watch as nature, now polluted by humans, silently turns against life on Earth.
Thanks for reading this letter!
Joseph Raglione
Executive director: The World Humanitarian Peace and Ecology Movement.
Peace with love and harmony towards all life on Earth.
All that ever was still is constantly changing within the eternal energy of the universe and the only constant within eternity is constant change. Author: Joseph Raglione Gentle People:
Welcome to my index of fun websites and return as often as you like. Joseph Raglione/
You're part of a SumOfUs community that has done so much for the bees -- and the security of our food supply. Because of the pressure from SumOfUs members, one of the biggest home and garden supply stores has taken "neonic" pesticides off its shelves. Because of people-power, we were able to shake up Bayer's annual general meeting in Cologne, Germany two years running. We're supporting a vital legal battle to keep bee-killing pesticides banned in the Europe, while trying to spread the ban on the same chemicals in other parts of the world. SumOfUs members are helping to lead the fight to save the bees all over the planet.
Your support is crucial now. Our decision-makers need to see the vital research done by Jonathan Lundgren and his peers so they can finally ban these pesticides for good. We simply can't afford to let big corporations shut down researchers.
Thank you so much,
Carys and the team from SumOfUs
Original email:
An award-winning bee scientist has been suspended in retaliation for his research linking bee die-offs to bee-killing pesticides. Will you chip in CA$1 to stand with him against the censorship of science?
One of the world's top bee scientists has been suspended for publishing research on bee-killing pesticides.
Jonathan Lundgren was an award-winning scientist for 11 years with the U.S. Department of Agriculture. But once he started publishing data linking pesticides to bee and butterfly die-offs, he was ordered to stop talking.
When he refused, he was suspended.
Now Jonathan is fighting back. He's filed a whistleblower complaint to make sure that corporations can’t get away with gagging science.
This isn’t the first time we’ve seen corporate-influenced governments trying to silence bee scientists.
In the U.K., the government silenced scientists who disagreed with a decision to lift a ban on bee-killing pesticides. Big Ag lobbyists wanted the ban lifted, but when the scientists wouldn't go along with it, the government simply told them not to publish their views.
But this time the corporations picked on the wrong scientist. Jonathan Lundgren is refusing to back down.
Now a judge has ruled that Jonathan's whistleblower complaint may go forward -- meaning he has a real chance of getting justice and showing how corporations are exerting undue influence over government research.
Will you chip in CA$1 to help fight back? T o help make sure that Jonathan Lundgren and other bee scientists can speak the truth without harassment?
SumOfUs is a worldwide movement of people like you, working together to hold corporations accountable for their actions and forge a new, sustainable path for our global economy.
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Tuesday, January 12, 2016
Gentle People:
Utilizing repetitive suggestion, Hypnosis is a method for bypassing the conscious mind and directly influencing the subconscious mind of another human being. One powerful form of Hypnosis is religious indoctrination created by imposing super suggestions into the minds of babies and children and many adults.
It was by accident I failed to be religiously indoctrinated as a child and by force of will, I refused to be indoctrinated as I grew older. Today I am a fact-based social science person, however, as a child I did absorb the religious Holy Day celebrations and ceremonies of different religions and I continue to enjoy all the holidays associated with all religions simply because indoctrinated religious people show such wonderful passion and love for each other during their Holy Days. It is a shame they try to kill each other in the name of their Gods during non-Holy Days.
The best ceremony, however, I reserve for myself. The ceremony of communing with nature. Life is full of natural wonders and I am always discovering something beautiful! It is my passion and it is based on my curiosity to discover facts as opposed to absorbing imposed indoctrination! I am a lover of life!
If you believe you are not indoctrinated, ask yourself how many times you watch the same repetitive commercial on Television?
P.S. My lady love also appreciates my passion for life.
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hyp·no·sis
hipˈnōsəs/
noun
the induction of a state of consciousness in which a person apparently loses the power of voluntary action and is highly responsive to suggestion or direction. Its use in therapy, typically to recover suppressed memories or to allow modification of behavior by suggestion, has been revived but is still controversial.
the state of consciousness produced by hypnosis.
Sunday, January 10, 2016
Gentle People:
In Canada, we need to copy the Switzerland and Denmark and Norway model of government. A government based on social trust between basically opposing groups.
The governments of these Three Nordique countries believe in human rights and they each have social policies that protect the general population. They have free Medical care and free University education and their unemployment and pension funds are full providing a safety net for their citizens.
They also have industrial capitalism where industries are allowed to lay off workers without serious consequence if the companies have cash flow problems. The unemployment insurance and the free education system picks up the slack to help re-educate laid-off workers. They also have an extremely high Tax rate that pays for the free social safety net. This, along with a protected conservative pension fund and basic social trust where pulling your own weight is the norm; has created within these countries a social contract that is debt free and the best in the world. These Nordique countries are great models for our Canadian social system.
With that said, I would like to remind the Canadian government that global warming is deadly serious and Gas and Oil are dangerous pollutants. Do not buy Gas or Oil from Nordique countries or from any other country and find alternative energy solutions at home here in Canada.
Here are some surprisingly good candid pictures from the U.S. White House photographers. They are pictures that capture the essence of a working president who is also a family man and who abides by deep moral convictions. President Obama is a good man and a great president and he will be hard to replace.
For the Wealthiest, a Private Tax System That Saves Them Billions
The very richest are able to quietly shape tax policy that will allow them to shield billions in income.
Daniel S. Loeb, shown with his wife, Margaret, runs the $17 billion Third Point hedge fund. Mr. Loeb, who has owned a home in East Hampton, has contributed to Jeb Bush’s super PAC and given $1 million to the American Unity Super PAC, which supports gay rights.CreditLeft: Patrick McMullan Company; Right: Doug Kuntz
WASHINGTON — The hedge fund magnates Daniel S. Loeb, Louis Moore Bacon and Steven A. Cohen have much in common. They have managed billions of dollars in capital, earning vast fortunes. They have invested large sums in art — and millions more in political candidates.
Moreover, each has exploited an esoteric tax loophole that saved them millions in taxes. The trick? Route the money to Bermuda and back.
With inequality at its highest levels in nearly a century and public debate rising over whether the government should respond to it through higher taxes on the wealthy, the very richest Americans have financed a sophisticated and astonishingly effective apparatus for shielding their fortunes. Some call it the “income defense industry,” consisting of a high-priced phalanx of lawyers, estate planners, lobbyists and anti-tax activists who exploit and defend a dizzying array of tax maneuvers, virtually none of them available to taxpayers of more modest means.
In recent years, this apparatus has become one of the most powerful avenues of influence for wealthy Americans of all political stripes, including Mr. Loeb and Mr. Cohen, who give heavily to Republicans, and the liberal billionaire George Soros, who has called for higher levies on the rich while at the same time using tax loopholes to bolster his own fortune.
All are among a small group providing much of the early cash for the 2016 presidential campaign.
Operating largely out of public view — in tax court, through arcane legislative provisions and in private negotiations with the Internal Revenue Service — the wealthy have used their influence to steadily whittle away at the government’s ability to tax them. The effect has been to create a kind of private tax system, catering to only several thousand Americans.
The impact on their own fortunes has been stark. Two decades ago, when Bill Clinton was elected president, the 400 highest-earning taxpayers in America paid nearly 27 percent of their income in federal taxes, according to I.R.S. data. By 2012, when President Obama was re-elected, that figure had fallen to less than 17 percent, which is just slightly more than the typical family making $100,000 annually, when payroll taxes are included for both groups.
The ultra-wealthy “literally pay millions of dollars for these services,” said Jeffrey A. Winters, a political scientist at Northwestern University who studies economic elites, “and save in the tens or hundreds of millions in taxes.”
Some of the biggest current tax battles are being waged by some of the most generous supporters of 2016 candidates. They include the families of the hedge fund investors Robert Mercer, who gives to Republicans, and James Simons, who gives to Democrats; as well as the options trader Jeffrey Yass, a libertarian-leaning donor to Republicans.
Mr. Yass’s firm is litigating what the agency deemed to be tens of millions of dollars in underpaid taxes. Renaissance Technologies, the hedge fund Mr. Simons founded and which Mr. Mercer helps run, is currently under review by the I.R.S. over a loophole that saved their fund an estimated $6.8 billion in taxes over roughly a decade, according to a Senate investigation. Some of these same families have also contributed hundreds of thousands of dollars to conservative groups that have attacked virtually any effort to raises taxes on the wealthy.
In the heat of the presidential race, the influence of wealthy donors is being tested. At stake is the Obama administration’s 2013 tax increase on high earners — the first substantial increase in two decades — and an I.R.S. initiative to ensure that, in effect, the higher rates stick by cracking down on tax avoidance by the wealthy.
While Democrats like Bernie Sanders and Hillary Clinton have pledged to raise taxes on these voters, virtually every Republican has advanced policies that would vastly reduce their tax bills, sometimes to as little as 10 percent of their income.
At the same time, most Republican candidates favor eliminating the inheritance tax, a move that would allow the new rich, and the old, to bequeath their fortunes intact, solidifying the wealth gap far into the future. And several have proposed a substantial reduction — or even elimination — in the already deeply discounted tax rates on investment gains, a foundation of the most lucrative tax strategies.
“There’s this notion that the wealthy use their money to buy politicians; more accurately, it’s that they can buy policy, and specifically, tax policy,” said Jared Bernstein, a senior fellow at the left-leaning Center on Budget and Policy Priorities who served as chief economic adviser to Vice President Joseph R. Biden Jr. “That’s why these egregious loopholes exist, and why it’s so hard to close them.”
The Family Office
Each of the top 400 earners took home, on average, about $336 million in 2012, the latest year for which data is available. If the bulk of that money had been paid out as salary or wages, as it is for the typical American, the tax obligations of those wealthy taxpayers could have more than doubled.
Instead, much of their income came from convoluted partnerships and high-end investment funds. Other earnings accrued in opaque family trusts and foreign shell corporations, beyond the reach of the tax authorities.
The well-paid technicians who devise these arrangements toil away at white-shoe law firms and elite investment banks, as well as a variety of obscure boutiques. But at the fulcrum of the strategizing over how to minimize taxes are so-called family offices, the customized wealth management departments of Americans with hundreds of millions or billions of dollars in assets.
Family offices have existed since the late 19th century, when the Rockefellers pioneered the institution, and gained popularity in the 1980s. But they have proliferated rapidly over the last decade, as the ranks of the super-rich, and the size of their fortunes, swelled to record proportions.
“We have so much wealth being created, significant wealth, that it creates a need for the family office structure now,” said Sree Arimilli, an industry recruiting consultant.
Family offices, many of which are dedicated to managing and protecting the wealth of a single family, oversee everything from investment strategy to philanthropy. But tax planning is a core function. While the specific techniques these advisers employ to minimize taxes can be mind-numbingly complex, they generally follow a few simple principles, like converting one type of income into another type that’s taxed at a lower rate.
Mr. Loeb, for example, has invested in a Bermuda-based reinsurer — an insurer to insurance companies — that turns around and invests the money in his hedge fund. That maneuver transforms his profits from short-term bets in the market, which the government taxes at roughly 40 percent, into long-term profits, known as capital gains, which are taxed at roughly half that rate. It has had the added advantage of letting Mr. Loeb defer taxes on this income indefinitely, allowing his wealth to compound and grow more quickly.
The Bermuda insurer Mr. Loeb helped set up went public in 2013 and is active in the insurance business, not merely a tax dodge. Mr. Cohen and Mr. Bacon abandoned similar insurance-based strategies in recent years. “Our investment in Max Re was not a tax-driven scheme, but rather a sound investment response to investor interest in a more dynamically managed portfolio akin to Warren Buffett’s Berkshire Hathaway,” said Mr. Bacon, who leads Moore Capital Management. “Hedge funds were a minority of the investment portfolio, and Moore Capital’s products a much smaller subset of this alternative portfolio.” Mr. Loeb and Mr. Cohen declined to comment.
Photo
Louis Moore Bacon, shown with his wife, Gabrielle, is the founder of a highly successful hedge fund and a leading contributor to Jeb Bush’s super PAC. Among his homes is one on Robins Island, off Long Island.CreditLeft: Amanda Gordon/Bloomberg News, via Getty Images
Organizing one’s business as a partnership can be lucrative in its own right. Some of the partnerships from which the wealthy derive their income are allowed to sell shares to the public, making it easy to cash out a chunk of the business while retaining control. But unlike publicly traded corporations, they pay no corporate income tax; the partners pay taxes as individuals. And the income taxes are often reduced by large deductions, such as for depreciation.
For large private partnerships, meanwhile, the I.R.S. often struggles “to determine whether a tax shelter exists, an abusive tax transaction is being used,” according to a recent report by the Government Accountability Office. The agency is not allowed to collect underpaid taxes directly from these partnerships, even those with several hundred partners. Instead, it must collect from each individual partner, requiring the agency to commit significant time and manpower.
The wealthy can also avail themselves of a range of esoteric and customized tax deductions that go far beyond writing off a home office or dinner with a client. One aggressive strategy is to place income in a type of charitable trust, generating a deduction that offsets the income tax. The trust then purchases what’s known as a private placement life insurance policy, which invests the money on a tax-free basis, frequently in a number of hedge funds. The person’s heirs can inherit, also tax-free, whatever money is left after the trust pays out a percentage each year to charity, often a considerable sum.
Many of these maneuvers are well established, and wealthy taxpayers say they are well within their rights to exploit them. Others exist in a legal gray area, its boundaries defined by the willingness of taxpayers to defend their strategies against the I.R.S. Almost all are outside the price range of the average taxpayer.
Among tax lawyers and accountants, “the best and brightest get a high from figuring out how to do tricky little deals,” said Karen L. Hawkins, who until recently headed the I.R.S. office that oversees tax practitioners. “Frankly, it is almost beyond the intellectual and resource capacity of the Internal Revenue Service to catch.”
The combination of cost and complexity has had a profound effect, tax experts said. Whatever tax rates Congress sets, the actual rates paid by the ultra-wealthy tend to fall over time as they exploit their numerous advantages.
From Mr. Obama’s inauguration through the end of 2012, federal income tax rates on individuals did not change (excluding payroll taxes). But the highest-earning one-thousandth of Americans went from paying an average of 20.9 percent to 17.6 percent. By contrast, the top 1 percent, excluding the very wealthy, went from paying just under 24 percent on average to just over that level.
“We do have two different tax systems, one for normal wage-earners and another for those who can afford sophisticated tax advice,” said Victor Fleischer, a law professor at the University of San Diego who studies the intersection of tax policy and inequality. “At the very top of the income distribution, the effective rate of tax goes down, contrary to the principles of a progressive income tax system.”
A Very Quiet Defense
Having helped foster an alternative tax system, wealthy Americans have been aggressive in defending it.
Trade groups representing the Bermuda-based insurance company Mr. Loeb helped set up, for example, have spent the last several months pleading with the I.R.S. that its proposed rules tightening the hedge fund insurance loophole are too onerous.
The major industry group representing private equity funds spends hundreds of thousands of dollars each year lobbying on such issues as “carried interest,” the granddaddy of Wall Street tax loopholes, which makes it possible for fund managers to pay the capital gains rate rather than the higher standard tax rate on a substantial share of their income for running the fund.
The budget deal that Congress approved in October allows the I.R.S. to collect underpaid taxes from large partnerships at the firm level for the first time — which is far easier for the agency — thanks to a provision that lawmakers slipped into the deal at the last minute, before many lobbyists could mobilize. But the new rules are relatively weak — firms can still choose to have partners pay the taxes — and don’t take effect until 2018, giving the wealthy plenty of time to weaken them further.
Shortly after the provision passed, the Managed Funds Association, an industry group that represents prominent hedge funds like D. E. Shaw, Renaissance Technologies, Tiger Management and Third Point, began meeting with members of Congress to discuss a wish list of adjustments. The founders of these funds have all donated at least $500,000 to 2016 presidential candidates. During the Obama presidency, the association itself has risen to become one of the most powerful trade groups in Washington, spending over $4 million a year on lobbying.
And while the lobbying clout of the wealthy is most often deployed through industry trade associations and lawyers, some rich families have locked arms to advance their interests more directly.
The inheritance tax has been a primary target. In the early 1990s, a California family office executive named Patricia Soldano began lobbying on behalf of wealthy families to repeal the tax, which would not only save them money, but also make it easier to preserve their business empires from one generation to the next. The idea struck many hardened operatives as unrealistic at the time, given that the tax affected only the wealthiest Americans. But Ms. Soldano’s efforts — funded in part by the Mars and Koch families — laid the groundwork for a one-year elimination in 2010.
The tax has been restored, but currently applies only to couples leaving roughly $11 million or more to their heirs, up from those leaving more than $1.2 million when Ms. Soldano started her campaign. It affected fewer than 5,200 families last year.
“If anyone would have told me we’d be where we are today, I would never have guessed it,” Ms. Soldano said in an interview.
Some of the most profound victories are barely known outside the insular world of the wealthy and their financial managers.
In 2009, Congress set out to require that investment partnerships like hedge funds register with the Securities and Exchange Commission, partly so that regulators would have a better grasp on the risks they posed to the financial system.
The early legislative language would have required single-family offices to register as well, exposing the highly secretive institutions to scrutiny that their clients were eager to avoid. Some of the I.R.S.’s cases against the wealthy originate with tips from the S.E.C., which is often better positioned to spot tax evasion.
By the summer of 2009, several family office executives had formed a lobbying group called the Private Investor Coalition to push back against the proposal. The coalition won an exemption in the 2010 Dodd-Frank financial reform bill, then spent much of the next year persuading the S.E.C. to largely adopt its preferred definition of “family office.”
So expansive was the resulting loophole that Mr. Soros’s $24.5 billion hedge fund took advantage of it, converting to a family office after returning capital to its remaining outside investors. The hedge fund manager Stanley Druckenmiller, a former business partner of Mr. Soros, took the same step.
The Soros family, which generally supports Democrats, has committed at least $1 million to the 2016 presidential campaign; Mr. Druckenmiller, who favors Republicans, has put slightly more than $300,000 behind three different G.O.P. presidential candidates.
A slide presentation from the Private Investor Coalition’s 2013 annual meeting credited the success to multiple meetings with members of the Senate Banking Committee, the House Financial Services Committee, congressional staff and S.E.C. staff. “All with a low profile,” the document noted. “We got most of what we wanted AND a few extras we didn’t request.”
After all the loopholes and all the lobbying, what remains of the government’s ability to collect taxes from the wealthy runs up against one final hurdle: the crisis facing the I.R.S.
President Obama has made fighting tax evasion by the rich a priority. In 2010, he signed legislation making it easier to identify Americans who squirreled away assets in Swiss bank accounts and Cayman Islands shelters.
His I.R.S. convened a Global High Wealth Industry Group, known colloquially as “the wealth squad,” to scrutinize the returns of Americans with incomes of at least $10 million a year.
But while these measures have helped the government retrieve billions, the agency’s efforts have flagged in the face of scandal, political pressure and budget cuts. Between 2010, the year before Republicans took control of the House of Representatives, and 2014, the I.R.S. budget dropped by almost $2 billion in real terms, or nearly 15 percent. That has forced it to shed about 5,000 high-level enforcement positions out of about 23,000, according to the agency.
Audit rates for the $10 million-plus club spiked in the first few years of the Global High Wealth program, but have plummeted since then.
Photo
Steven A. Cohen, shown with his wife, Alexandra, is the founder of SAC Capital and owns a home in East Hampton. He is a prominent art collector and has focused his political contributions on a super PAC for Gov. Chris Christie.CreditLeft: Carly Erickson/BFA; Right: Doug Kuntz for The New York Times
The political challenge for the agency became especially acute in 2013, after the agency acknowledged singling out conservative nonprofits in a review of political activity by tax-exempt groups. (Senior officials left the agency as a result of the controversy.)
Several former I.R.S. officials, including Marcus Owens, who once headed the agency’s Exempt Organizations division, said the controversy badly damaged the agency’s willingness to investigate other taxpayers, even outside the exempt division.
“I.R.S. enforcement is either absent or diminished” in certain areas, he said. Mr. Owens added that his former department — which provides some oversight of money used by charities and nonprofits — has been decimated.
Groups like FreedomWorks and Americans for Tax Reform, which are financed partly by the foundations of wealthy families and large businesses, have called for impeaching the I.R.S. commissioner. They are bolstered by deep-pocketed advocacy groups like the Club for Growth, which has aided primary challenges against Republicans who have voted in favor of higher taxes.
In 2014, the Club for Growth Action fund raised more than $9 million and spent much of it helping candidates critical of the I.R.S. Roughly 60 percent of the money raised by the fund came from just 12 donors, including Mr. Mercer, who has given the group $2 million in the last five years. Mr. Mercer and his immediate family have also donated more than $11 million to several super PACs supporting Senator Ted Cruz of Texas, an outspoken I.R.S. critic and a presidential candidate.
Another prominent donor is Mr. Yass, who helps run a trading firm called the Susquehanna International Group. He donated $100,000 to the Club for Growth Action fund in September. Mr. Yass serves on the board of the libertarian Cato Institute and, like Mr. Mercer, appears to subscribe to limited-government views that partly motivate his political spending.
But he may also have more than a passing interest in creating a political environment that undermines the I.R.S. Susquehanna is currently challenging a proposed I.R.S. determination that an affiliate of the firm effectively repatriated more than $375 million in income from subsidiaries located in Ireland and the Cayman Islands in 2007, creating a large tax liability. (The affiliate brought the money back to the United States in later years and paid dividend taxes on it; the I.R.S. asserts that it should have paid the ordinary income tax rate, at a cost of tens of millions of dollars more.)
In June, Mr. Yass donated more than $2 million to three super PACs aligned with Senator Rand Paul of Kentucky, who has called for taxing all income at a flat rate of 14.5 percent. That change in itself would save wealthy supporters like Mr. Yass millions of dollars.
Mr. Paul, also a presidential candididate, has suggested going even further, calling the I.R.S. a “rogue agency” and circulating a petition in 2013 calling for the tax equivalent of regime change. “Be it now therefore resolved,” the petition reads, “that we, the undersigned, demand the immediate abolishment of the Internal Revenue Service.”
But even if that campaign is a long shot, the richest taxpayers will continue to enjoy advantages over everyone else.
For the ultra-wealthy, “our tax code is like a leaky barrel,” said J. Todd Metcalf, the Democrats’ chief tax counsel on the Senate Finance Committee. ”Unless you plug every hole or get a new barrel, it’s going to leak out.”
