Saturday, August 20, 2011

Taxing Trademarks as a Means to Reduce the Federal Government Deficit

Have you been following the Apple vs. Samsung saga in Europe? It is an exemplary case of over-reaching intellectual property rights showing that patent rights, design rights, copyright rights and trademark rights should be severely limited by law in the future.

Companies like Apple should not be able to appropriate commercial design rights to rectangles with rounded edges.

Apple has sued Samsung for violation of its German-registered iPad2 design, a design that Apple has in fact stolen from numerous prior art tablets, as we have pointed out in recent LawPundit postings.

Worse, companies like Apple began with theft. The name "Apple" did not belong to the company, but rather is a word in the English language that belongs to us, the people. Words do not belong to corporations. It was stolen -- from us -- with no adequate compensation being paid into the tax coffers for its appropriation.

You may say that I exaggerate, but the fact is that I could not today issue or sell a computer or phone product under the name Apple if I wanted to. That word has been stolen, right out of the language for that purpose.

Where is the legal theory that permits that appropriation? Where is the Constitutional provision in the U.S. Constitution that allows English-language words to be appropriated "for free", and then to be used for commercial purposes, excluding all other citizens from using those English-language words for the same purposes?

After all, corporate names and trademarks could be fantasy words that do not otherwise exist in the language. Apple could have named itself e.g. Tsiloponom (monopolist backwards) and no one would have objected.

Similarly, Apple at its origin could have called itself e.g. Wozniak-Jobs after the names of its founders. Not a great marketing ring, we admit.

No, the company "took" (and we mean took) the world Apple. It was a taking from the people, because that word through millennia of usage was already well-known long before Apple started its company and thus gave the company a great deal of starting goodwill via that name -- for free.

The only people who have paid for that name indirectly were the people - that's us -- who no longer could use that word to name phones or computers or anything else that the Apple firm trademarked, but had to relinquish the word apple to the Apple firm.

It is a mystery to this writer why the laws grant all kinds of absurd IP rights to companies to terrorize the commercial world with their government-granted monopolies, while the law at the same time permits companies like Apple to appropriate a people's word like apple for free and obtain trademark rights to that word with respect to computers, phones, tablets, etc.

But there is a solution to this problem.

We, the society members that are at the base of everything, also have our rights, and we need our governments to be paid for, so that not all the money goes into the private pockets of greedy corporations and their owners.

Accordingly, we suggest that a new tax law on trademarks be implemented to be paid on the basis of the number of product units sold under that trademark. That tax should be stiff and we suggest it should initially be assessed at 10% of the retail value of any product sold under any trademark.

This will help to reduce the federal government deficit and reimburse the people for the words stolen from them by the corporations.

Wealth in the USA and Reducing the Federal Government Debt: TO WHOM is that Money Owed Domestically?? Reduce the Debt by a Surcharge on Wealth

At the website Who Rules America?, Professor G. William Domhoff, Sociology Dept., University of California at Santa Cruz, writes in Wealth, Income, and Power, September 2005 (updated July 2011), that:
"In the United States, wealth is highly concentrated in a relatively few hands. As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth minus the value of one's home), the top 1% of households had an even greater share: 42.7%. [see the instructive tables here]"
We will use those figures down below in discussing a simple way to reduce federal government debt. [Note: 20% own 85% of the wealth, not 10%, as we mistakenly typed in an earlier version of this posting.]

In the first place, it is essential to determine TO WHOM do we owe that money?

Domestically, that money is owed by and large to the people who also own the most assets in the United States. The money is owed to the wealthy.

The traditional -- completely illogical -- argument is that the federal government debt is owed by everyone EQUALLY. The argument is that America has ca. 300 million people. The federal government owes about $15 trillion. That makes the debt around $50,000 for each man, woman and child in the United States.

So goes the argument, but that is totally wrong. That is not the way economics works.

If you have a $10 million home then you have to pay $10 million to get it. If you have $10 thousand dollar home then you pay only $10 thousand dollars for it (we ignore here the issue of interest payments on mortgages). In other words, people do not OWE equally if they acquire greater assets.

The same is true for the nation, where, in the United States, 20% of the population OWN 85% of the wealth of the country. But here, strangely enough, the rich do not care about EQUALITY at all. The debt, they argue, is owed equally by all inhabitants, but the great share of the spoils of debt belong UNEQUALLY to them. Obviously, that reasoning is totally false.

Pursuant to the above "house/home analogy", we argue that if the upper 20% of the country own 85% of the country, then their federal government debt obligation is also for 85% of the federal government debt, because THEY are the long-term benefactors of what the country has done in the past. A newly born American, for example, can not be saddled with a share of that debt, unless by birth he immediately owns property or other wealth. The federal debt has to be paid by the people in America who are the benefactors.

The rich scream that this would be unfair, but it is precisely the reverse, because that federal government debt is largely owed domestically to THEM.

What has happened in America is that "the haves" have invested their money -- for example -- in U.S. treasury certificates, and then expect the rest of the country to pay the interest on those certificates that they disproportionately collect. At the same time, they resist increasing taxes to reduce that federal government debt, in this manner socializing both their investment risk AND profit. In this way, more and more of the burden of financing America is placed on the shoulders of the poor, who earn increasingly less and whose wealth is dropping.

See Who is Paying for the Great Recession in the USA? Not Michele Bachmann or Rick Perry: Record High Wealth Gap Between Whites and Blacks, Hispanics.

The obvious method to reduce the government debt is therefore a kind of surcharge on wealth -- a simple equity contribution. Those who benefit the most in the country should pay their fair share of the debt, a fair share which is calculated by the value of their assets.

See The Equitable Non-Tax One-Day Solution to the US National Debt of $15 Trillion: Assess an 8% Equity Contribution on ALL Total Assets of $188 Trillion in America Regardless of Ownership.

As we note there, the actual equity contribution might be as low as only 4% if it turns out on the day of record that the asset valuation in America is actually substantially higher than $188 trillion, and that is very likely.

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