Historically, why have countries conquered other countries? Often, it was to enrich themselves. What if a government was already presiding over the richest country in the world? Then the goal might be to enrich themselves off their own people. What is the world's largest source of money? The American taxpayer. The question becomes how to maximize the collection of taxes. Here's how:
Guilt Tax
Cigarettes, alcohol, gas guzzling sports cars and a variety of other sins are taxed at a high rate. After all, we feel bad about using these things and feel a heavy tax is just. But it doesn't stop there. The more things that can be tagged as "bad", the more money can be made. Climategate attempted to label all industry as bad carbon producers, thereby opening the way to far reaching taxes that would dwarf anything that came before.
Regulation tax
Many regulations seem to be beneficial, such as pollution checks on cars. But verifying their compliance incurs a cost which typically must be paid by everybody. Fines also help pay for the regulations. Just because a new regulation would be more good than bad, that doesn't mean it should be passed. The additional complexity for citizens and businesses is already overwhelming, reducing the time they can devote to keeping their head above water. The fees or taxes add another cost. These can drag an otherwise good regulation well below the good/bad dividing line, making the costs far outweigh the benefits. But it is a moneymaker for the government.
Rich tax
I love this one because rich people are certainly in the minority, so their voting power is near zero, while the majority of voters pay no federal taxes at all, they do not see that they have any skin in the game. But they do pay dearly. The rich have gotten richer through this recession, increasing the disparity between rich and poor. We really need a working class that works hard and is paid well. This is a problem that is not being addressed. Instead, legislators want to take advantage of the disparity. Imagine being able to levy heavy taxes on the nation without them having any say in the matter. All you have to do is shift the wealth to the rich and tax them. Did they do this purposely, or was it just fortunate happenstance? Either way, a tax is not the answer. A rich tax is more likely to institutionalize the disparity than break it. And it trickles up from the workers whose sacrifice is feeding it. They just don't see it on their pay stubs.
Specific Industries
Identify some reason to tax certain industries more than others and you again have an easy target with no voting power.
National Security
We seem to be fighting wars on dual fronts, offshore and here at home, where extremists try to topple our government. The solution seems to be make the size of government larger, more well defended, more unassailable. But that in itself makes it more unstable and unsustainable, as economic swings and other factors cause it to reel wildly. But who in government can resist the prospect of such growth?
Real Estate, Sales Tax
State and local taxes attack citizens from another direction, in ways that often do not overlap how the federal government taxes. We don't pay federal taxes on real estate, but taken all together, all the sources add up to quite a chunk of money. It is difficult for any individual to know how much tax they actually do pay.
And finally, Everybody Else
Once it is shown that legislators went after all the other interests and collected higher taxes, and yet they somehow still need money, it's more palatable to levy another tax across the board that affects most other people. This can be done on the basis of some costs going up, inflation, etc.
Deception About the Facts
The debt ceiling talks are a great example of public denial of the problem. The "baseline" estimate of revenues, which most reasonable people would expect to be a flat line is really defined as a climbing curve. Are they really making a sincere effort to communicate how much of our money they are taking? Of course not, which is part of the strategy.
Divide and Conquer
The tax strategy involves whittling down the opposition to a voting minority, then finding an excuse to tax them. Then move on to the next minority and the next until everybody is tapped.
7/30/2011
Government Just Can't Manage People. Everything Else Works Great
When Illinois Governor Quinn or Chicago Mayor Emanuel try to get their workers to work more efficiently to cut costs once, which is what every private company constantly does, they meet a brick wall of resistance from unions - middlemen who resist improvements - or change of any kind. A great example is the article, how-many-city-workers-does-it-take-to-change-a-light-bulb. The short answer is 3, which is three times as many as the private sector operating across the street from them.
It has been argued that the solution to this is to employ subcontractors from the private sectors. But here they run into problems too, pentagon-push-to-cut-contractors-takes-toll-on-businesses. They tried that and found it costs them less to do it themselves. One criticism in the article is that they even fail to properly evaluate the savings when making the switch. So it's not just poor management of workers. It's a lack of basic understanding about what they are doing, whether they are succeeding or failing.
Let's see, it costs them three times as much as private industry to do a job themselves. But it costs even more than than to hire subcontractors. Fool me once, shame on you. Fool me twice, shame on me.
The common thread in these two cases is they are managing somebody. Maybe they are just not cut out for that. It is worrying that the even bigger job of managing the country is going to them. One does notice that myriad regulations promoted by special interests continue to find their way into the national agenda and impact every citizen, far too often in a net negative way. The Climategate scam comes to mind and one can quickly list half a dozen others, with more time, a thousand others. But let us not digress. Let's focus on the people they pay do get work done.
Whether a direct workforce or subcontractors, they do it very expensively to taxpayers. They can't eliminate waste. They can't control it much at all. It seems the only solution is to make government as small as possible so that when they do waste, that too is as small as possible.
It has been argued that the solution to this is to employ subcontractors from the private sectors. But here they run into problems too, pentagon-push-to-cut-contractors-takes-toll-on-businesses. They tried that and found it costs them less to do it themselves. One criticism in the article is that they even fail to properly evaluate the savings when making the switch. So it's not just poor management of workers. It's a lack of basic understanding about what they are doing, whether they are succeeding or failing.
Let's see, it costs them three times as much as private industry to do a job themselves. But it costs even more than than to hire subcontractors. Fool me once, shame on you. Fool me twice, shame on me.
The common thread in these two cases is they are managing somebody. Maybe they are just not cut out for that. It is worrying that the even bigger job of managing the country is going to them. One does notice that myriad regulations promoted by special interests continue to find their way into the national agenda and impact every citizen, far too often in a net negative way. The Climategate scam comes to mind and one can quickly list half a dozen others, with more time, a thousand others. But let us not digress. Let's focus on the people they pay do get work done.
Whether a direct workforce or subcontractors, they do it very expensively to taxpayers. They can't eliminate waste. They can't control it much at all. It seems the only solution is to make government as small as possible so that when they do waste, that too is as small as possible.
7/28/2011
Can we Start Drilling our own Oil?
When ultra tight U.S. environmental regulations virtually stopped oil drilling here, what was supposed to help the environment actually hurts it. That's because other countries with lax regulations drill the oil for us. They make a bigger mess than we would have. That doesn't make sense.
Then there's jobs. We import over a billion dollars of oil every day. That's a thousand millionaires created in one day -- offshore. Ouch. I want those people in my neighborhood. Or a million people that made a thousand dollars in one day... In other-other words, it's a boatload of money. Okay, three boatloads of the largest supertakers.
We have this unemployment problem. We can pay millions and millions of people's wages by drilling domestically. Every million is another 1% or so unemployment reduction. More when you consider the rippling effects of what those people spend. And we can reduce worldwide pollution.
It should make everyone happy. What's the holdup?
Then there's jobs. We import over a billion dollars of oil every day. That's a thousand millionaires created in one day -- offshore. Ouch. I want those people in my neighborhood. Or a million people that made a thousand dollars in one day... In other-other words, it's a boatload of money. Okay, three boatloads of the largest supertakers.
We have this unemployment problem. We can pay millions and millions of people's wages by drilling domestically. Every million is another 1% or so unemployment reduction. More when you consider the rippling effects of what those people spend. And we can reduce worldwide pollution.
It should make everyone happy. What's the holdup?
Democrats are the Give a Man a Fish Party; Republicans Need to be the Teach Him How to Fish Party
Last election, I thought the Democrats held the moral high ground. On the environment, for example. Then came Climategate. On taking care of the disadvantaged. That's when entitlements were shown to be growing out of control.
I don't know what Republicans are today, but if they position themselves correctly, they can get this country on track and beat the Democrats every time. They can't do it through handouts. The give a man a fish philosophy is no longer sustainable.
I don't know what Republicans are today, but if they position themselves correctly, they can get this country on track and beat the Democrats every time. They can't do it through handouts. The give a man a fish philosophy is no longer sustainable.
Why Did My Real Estate Assessed Value Go Down but My Taxes Went Up?
I visited the county records office and asked this question. They are very nice people, by the way. The person helping me said the tax rate went up for almost every program because they needed more money. The reduced assessed value was part of the reason.
So, now I get it: My taxes go up when my assessment goes up. And when my assessment goes down, my taxes go up. The nice thing is there is no vote, they have authority to raise taxes any time. Nice for them. Maybe we don't need quite as many of those very nice people.
Can anyone say taxation without representation?
So, now I get it: My taxes go up when my assessment goes up. And when my assessment goes down, my taxes go up. The nice thing is there is no vote, they have authority to raise taxes any time. Nice for them. Maybe we don't need quite as many of those very nice people.
Can anyone say taxation without representation?
How Much Spending Will Congress Really Cut? Around Zero?
The current debt ceiling debate centers on one honorable goal: For every dollar of debt ceiling raised, they must also cut one dollar of spending. The problems are three-fold:
Congress is certainly acting seriously, as if government programs really are at stake, that cuts could actually happen. But this is a years long, unpopular process. Congressmen are much comfortable bringing more money to their constituents. The cuts could get derailed every step of the way. One does not get the feeling this is going to work. Congressmen, keep at it with every year another pitched battle, until it starts to happen.
- The cuts are total dollars over ten years, while the spending increases are made this year. In other words, they are really cutting spending an average of 1/10 or 10 cents for every dollar spent.
- The specific cuts aren't actually agreed to. When real programs go on the chopping block, the outcry by affected workers, unions and special interest groups will be like nothing we have seen before. It is difficult to imagine any cuts at all. Whatever does get cut is very likely to be much less than the original plan.
- Much of the spending cuts are further out in time. In one plan, barely a billion dollars will be cut in the first year for 850 billion of spending increase in the same first year.
Congress is certainly acting seriously, as if government programs really are at stake, that cuts could actually happen. But this is a years long, unpopular process. Congressmen are much comfortable bringing more money to their constituents. The cuts could get derailed every step of the way. One does not get the feeling this is going to work. Congressmen, keep at it with every year another pitched battle, until it starts to happen.
Default Merely Faces the Inevitable Sooner Rather Than Later
If the nation defaults on its debt, interest rates go up and there will not be enough money to run the federal - and state - governments any longer. Basically, the programs that we all know will have to be cut just to break even. Or taxes have to be raised significantly.
But a tax increase does not look like it will fly in the current environment: High unemployment, rise of Tea Party conservatism plus all the other reasons people don't want to pay more taxes to get the same thing they had before. But it probably would have happened in a few years anyway: As spending increases, we get ever closer to that fine line between being just above water to being below.
If we cannot solve the problem responsibly, it is far better to see a default happen sooner rather than later when the impact will be more painful, when more government workers will be affected and more entitlement recipients will be dependent.
But a tax increase does not look like it will fly in the current environment: High unemployment, rise of Tea Party conservatism plus all the other reasons people don't want to pay more taxes to get the same thing they had before. But it probably would have happened in a few years anyway: As spending increases, we get ever closer to that fine line between being just above water to being below.
If we cannot solve the problem responsibly, it is far better to see a default happen sooner rather than later when the impact will be more painful, when more government workers will be affected and more entitlement recipients will be dependent.
All of Us Do Not Want the Debt Crisis to Go Away So Quickly!
Except at the end of a war, how often do you remember government being downsized? Almost without exception, government can only grow. A democracy does not seem to know any other way to operate. As one commentator put it: In the past, Congress could always get everybody on board because there was enough money to address their local interests. It was a great "lubricant" in the negotiation process.
Two problems in today's debt ceiling debate; that lubricant doesn't exist when cutting programs and democracy doesn't know how to make painful cuts. That is why it is good to see the current debt ceiling debate be as painful and drawn out as possible. It is merely the baby step toward making real cuts on specific programs. If they can't make the baby step, they'll never get to the real cuts.
Two problems in today's debt ceiling debate; that lubricant doesn't exist when cutting programs and democracy doesn't know how to make painful cuts. That is why it is good to see the current debt ceiling debate be as painful and drawn out as possible. It is merely the baby step toward making real cuts on specific programs. If they can't make the baby step, they'll never get to the real cuts.
Obama's Debt Ceiling Speech Points at the Real Problem
On July 25, President Obama addressed the nation about the way he wants to raise the debt limit, which he described as a balanced approach consisting of tax increases and spending reductions. A transcript appears online, including CNN, the Washington Examiner and CBS.
In it, he said, "Understand – raising the debt ceiling does not allow Congress to spend more money. It simply gives our country the ability to pay the bills that Congress has already racked up."
This raises the most important points of the debt debate:
In it, he said, "Understand – raising the debt ceiling does not allow Congress to spend more money. It simply gives our country the ability to pay the bills that Congress has already racked up."
This raises the most important points of the debt debate:
- Congress has already spent the money.
- Congress knew the money was not there to spend. Somebody would have to come up with it.
- Congress never had to answer for overspending. This has emboldened them again and again. Obama pointed out, " In the past, raising the debt ceiling was routine."
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