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MYRTLE BEACH, SC - JANUARY 16: Republican Presidential candidates, former Massachusetts Gov. Mitt Romney (L) and former U.S. House Speaker Newt Gingrich (R-GA) share a laugh during a Fox News, Wall Street Journal-sponsored debate at the Myrtle Beach Convention Center, on January 16, 2012 in Myrtle Beach, South Carolina. Voters in South Carolina will head to the polls on January 21st. to vote in the Republican primary election to pick their choice for U.S. presidential candidate. (Photo by Joe Raedle/Getty Images)
Mitt Romney released his 2010 and 2011 tax returns today, revealing that he is, as we already knew, R-I-C-H. What's eye-popping — and what explains why Romney has been reluctant throughout his political career to provide a window into his finances — is how low his federal taxes are, relatively to people who make their money on "earned income," such as wages and salaries.
The numbers are large. In 2010, Romney made $21.6 million on 2010 and paid $3 million in federal taxes, and effective rate of just 13.9 percent. In 2011, he reported making $20.9 million in 2011 and expects to pay an effective rate of 15.4 percent.
If it's any consolation to people who routinely pay taxes the mid-20-percent bracket, the Romneys overpaid in 2010, to the tune of $1.6 million. Time for a new accountant, Mitt!
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Rep. Barney Frank (D-Mass), speaking at 'The Next Global Crisis' session of the Annual Meeting 2010 of the World Economic Forum in Davos, Switzerland, Jan. 27, 2010, at the Congress Centre.
The World Economic Forum — often described as a gathering of the world's business, government, and financial elites — will touch down in Davos, Switzerland this week. It's currently being much discussed and blogged about, especially given that the repercussions of the financial crisis are still being felt. Unemployment in the U.S. is still alarmingly high, at 8.5 percent. Europe still seems pretty far from fixing the deep problems of the euro and of averting a wider sovereign debt crisis. Growth in the developing world is slowing.
So in a way, Davos 2012 isn't about elitist hobnobbing but rather about Davos saving...itself. The pressing problems of the world aren't on the agenda. The ongoing economic travails of the West are. Writing for Reuters, former White House official Larry Summers offers the following:
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There's been plenty of speculation about who might buy the Dodgers out of bankruptcy. But today's the day that the bids are going to start coming in. This is a "soft" deadline, meaning that yet another rich guy who wants to buy the team could still put in a bid. But at this point we have a fair idea of who the major players are likely to be.
The Dodgers could sell for anywhere from $800 billion to $2 billion, based on reported speculation. At the LATimes, Bill Shaikin does the math and concludes that Dodgers owners Frank McCourt is on the hook to various creditors and his impending ex-wife for just north of $1 billion. So a we're probably talking about a sale price of around $1.5 billion.
Here's how the sale process will work. McCourt and Blackstone Advisory Partners will take the initial bids. They expect 20, and Major League Baseball says it will consider 10. However, given that there's only a few months between now and April 1, when it's anticipated that McCourt will announce a winning buyers, there probably won't be that many.
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The top of a form 1040 individual income tax return.
Fred Wilson, a venture capitalist at Union Square Ventures in New York, blogs daily at AVC and blogs well. His is the first post I read almost everyday, from a Google Reader that pipes in hundreds. I've written about his thinking before. There are times when he's great. And there are times when he drives me crazy.
On Sunday (he doesn't take the weekend off) the crazy was in evidence (in me, not Fred). After some speculation on where Mitt Romney's income comes from and why it's taxed at 15 percent, he goes on to discuss his own misgivings about getting a similar deal in his own business, due to the "carried interest" exception that allows him to treat income as capital gains. Then this:
...I am bothered by the unfairness of the situation. When I get a big distribution from our funds, I always ask my accountants how much of the distribution I should set aside for federal, state, and local taxes. The answer is usually something like 28% (the difference between 28% and 15% is the state and local taxes). And then I often think of my two brothers who probably pay 40-50% of their income each year in federal, state, and local taxes. It just seems so unfair.
And so lately I've been more and more attracted to the idea of a flat tax where everyone pays the same tax rate on income above a minimum amount. In this model, we would eliminate all tax deductions; for mortgages, charitable giving, for medical expenses, etc. There would be no difference in tax rates for ordinary income vs other forms of income (ie capital gains).
If we did that maybe everyone could pay a 15% tax rate like Mitt Romney and our family does. We would have a fair tax system.
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Ready for your Pinot Grande? Starbucks, the giant coffee retailer, has been undertaking a transformational experiment for the past two years. Back in 2010, on its home turf in Seattle, it began serving beer and wine and premium food in a setting that was meant to evoke a soothing nighttime experience more than a peppy morning wakeup call.
Now "Barbucks" is coming to the Southland. We don't yet know how many locations will serve alcohol along with caffeine, but we do know that the option will be available — and that Starbucks will be charging more-or-less typical prices. Wines will range from $7-9 a glass, while beer will clock in at a fairly modest $5.
We already know that Starbucks can print money, so to speak, by transforming coffee beans, milk, syrup, and other ingredients into $4 and $5 beverages. The beauty of wine and beer is that it requires much less labor to serve than producing a latte.