I’ve been driving in my car a lot recently and have been tuning in to Limbaugh and Hannity, just for a laugh:
A week ago: “The polls are tightening.”
Three days ago: “Don’t believe the polls.”
Today: “It is safe to say that the Obama campaign is cheating.”
Also on Monday, Limabaugh went on an extended tear about Obama’s tax plans and small business, and how 95% could not possibly make less than $250,000. He ran through many SBA numbers, characterizing firms in various industries as small businesses, based on their gross receipts. “Fisheries, less than $700,000 – small business.” He hammered away at this for an hour or more.
I’m laughing away at this, recalling the old rule of thumb that for every $100 a business takes in, it incurs $60 of labor expenses and $30 of materials, etc., leaving $10 of taxable income. D’oh.
Finally, “El Rushbo” noted that some emails had come in, raising this point. And he tried to put it back on Obama. “Is it net or gross. I don’t know. He has to tell us. Do you think any of the drive-by media will ask him? etc. etc.” I wonder what the reaction would be if a reporter asked, “Sen. Obama, when you say that you will not raise income taxes on any small business with an income under $250,000, do you mean income or gross receipts?”
Limbaugh persisted in his delusion, insisting that since “we all know Obama is lying anyway, this difference is minutia that doesn’t matter anyway.”
“Minutia” — the difference between gross receipts and taxable income. Hey, it’s only a factor of ten, one measly order of magnitude, right?
The latest Gallup poll has Obama only up by 2. But I'm not getting my hopes up unless the battleground polls start to shift back toward McCain."I'm laughing away at this, recalling the old rule of thumb that for every $100 a business takes in, it incurs $60 of labor expenses and $30 of materials, etc., leaving $10 of taxable income. "I'm not sure what rule this is. Most small businesses that had to spend 60% of gross sales on labor would quickly be bankrupt. For example, the benchmark industry average for pizzerias is 25% labor costs — and that's a labor intensive business. Most small businesses that are actually making money, and showing 10% or less taxable income are using creative accounting practices. (I have a lot of personal experience evaluating small business P&Ls).""Minutia" — the difference between gross receipts and taxable income. Hey, it's only a factor of ten, one measly order of magnitude, right?"Yeah, that kind of thing is why I don't take Limbaugh seriously. He can make good points & observations, but they are usually mixed with a lot of nonsense. Assuming Obama's 95% number is accurate — and that's a big assumption — it would seem he is talking about taxable income. But has Obama actually specified?
Haven’t listened to El Rushbo or Hannity in ages, even for sport. Both must be soiling themselves at the prospect of a Demo sweep.If the Dems do it, there sure won’t be much happiness across Rushbo’s “fruited plain,” especially if Al Franken wins in Min-na-SOTA.
My rule of thumb might be outdated or confused. But I just googled Intel, which had gross receipts of $8 billion in Q3 and net income of $885 million (which might be after taxes).
Stephen,I don't know what the calculations are for large companies like Intel, but small business profit expectations vary wildly, depending on business type. For example, although liquor stores can expect 10% net profit, it's 35% for laundromats. The main thing I was reacting to was the 60% labor cost, which isn't right for small businesses.Also, many small businesses are hiding a lot of cash and have off-the-books employees. Nobody buys a cash business in order to pay taxes. The main small businesses that will be hurt by any tax hike are the minority that accurately & honestly report their income & expenses, and the successful expanding ones that just can't hide enough cash to avoid the extra taxes.
Sorry to threadjack, but I’m wondering if this http://www.pe.com/localnews/inland/stories/PE_News_Local_S_buck16.3d67d4a.html counts as racist, or did the GOP mock Kerry for liking watermelon and fried chicken too?
bhcanuckistani,It sure looks racist. From the article you linked, the group’s president that was responsible for the illustration said:”I didn’t see it the way that it’s being taken. I never connected,” she said. “It was just food to me. It didn’t mean anything else.”How can someone be so totally and utterly clueless? There are even African-American members in her own organization. What an idiot.
David, the small businesses you mention – pizzerias, laundromats, liquor stores – all have very low pay for employees. I don’t have precise numbers, but apparently, mom-and-pop grocery stores pay their workers even less than Wal-Mart, and even then have low profit margins.Franken is the only Democrat who I want to lose in this election. His only redeeming feature is that he’s not as shrill or obnoxious as Ann Coulter and Rush Limbaugh. In related news, Ho Chi Minh wasn’t as much of a mass murderer as Mao or Pol Pot.
"David, the small businesses you mention – pizzerias, laundromats, liquor stores – all have very low pay for employees"That's mostly true, although many of them are paid in cash — so it's tax-free pay. I work with the owners of many of those types of businesses and I've seen all sorts of situations."but apparently, mom-and-pop grocery stores pay their workers even less than Wal-Mart" Of course they do, except for maybe one key employee in some cases. That's one reason a number of small businesses hire illegals. They can pay them less, they work hard, and they aren't going to turn the owner in for non-payment of payroll taxes if & when they get fired."and even then have low profit margins."You'd be surprised at some of the profit margins of those little grocery & convenience stores. Some are barely scraping by, often surviving on lottery commission income. But others are doing much better. I worked with one owner in a ghetto-ish city area who was pocketing about 90k — pretty much all of which was unreported.