According to the Congressional Budget Office, the last-minute fiscal cliff deal reached by congressional leaders and President Barack Obama cuts only $15 billion in spending while increasing tax revenues by $620 billion—a 41:1 ratio of tax increases to spending cuts.
Matthew Boyle via Fiscal Cliff Deal: $1 in Spending Cuts for Every $41 in Tax Increases.
The way our Constitution’s framers used the term, a right is something that exists simultaneously among people and imposes no obligation on another. For example, the right to free speech, or freedom to travel, is something we all simultaneously possess. My right to free speech or freedom to travel imposes no obligation upon another except that of non-interference. In other words, my exercising my right to speech or travel requires absolutely nothing from you and in no way diminishes any of your rights.
Contrast that vision of a right to so-called rights to medical care, food or decent housing, independent of whether a person can pay. Those are not rights in the sense that free speech and freedom of travel are rights. If it is said that a person has rights to medical care, food and housing, and has no means of paying, how does he enjoy them? There’s no Santa Claus or Tooth Fairy who provides them. You say, “The Congress provides for those rights.” Not quite. Congress does not have any resources of its very own. The only way Congress can give one American something is to first, through the use of intimidation, threats and coercion, take it from another American. So-called rights to medical care, food and decent housing impose an obligation on some other American who, through the tax code, must be denied his right to his earnings. In other words, when Congress gives one American a right to something he didn’t earn, it takes away the right of another American to something he did earn.
A ‘Judas Goat’ is a goat trained to associate with other herd animals, primarily sheep or cattle and lead them to slaughter. By following the Judas Goat the unsuspecting livestock calmly walk right up to their own demise. When it comes to taxation, make sure that you don’t follow the Judas Goat!
I’m consistently amazed at the stupid things that celebrities say and the questionable causes they support. Just look at how many celebrities have been hoodwinked by the extremist group PETA into endorsing their agenda and even posing naked to support it. I understand the need to ‘make a difference’ in the world but do your homework folks! The worst of these celebrity ’causes’ is the recent rash of celebrity ‘tax the rich’ and last year’s ‘support Occupy Wall Street’ celebrity endorsements.
These tax-increase celebrities remind me of that Judas Goat…with their expectation that we will be so star-struck that we calmly follow them into taxmeggeddon. Even seemingly rational businessmen like Warren Buffet have chosen to play the Goat. My only guess is that if you’ve accumulated all the wealth you’ll ever need than it’s worth it to deflect the animosity of the class envy by saying “no, really, I should be taxed more” or maybe the motivation is just guilt.
The problem with the Judas Goat is that his or her approach doesn’t lead to the Goat’s slaughter…just the rest of us. If you really believe you should pay more taxes it’s easy to do…just look how hard most U.S. citizens work to keep their tax burdens manageable. Continue reading
Nobody really knows what will work to get the economy back on course. And nobody-in fact, no central bank anywhere on the planet-has the experience of successfully navigating a return home from the place in which we now find ourselves. No central bank-not, at least, the Federal Reserve-has ever been on this cruise before.
Dallas Federal Reserve President Richard Fisher in a recent talk before a Harvard Club audience
As you have probably read in the mainstream media or noticed in the left column of this website, the U.S. National Debt has now surpassed $16,000,000,000,000!! Yes, that’s 16 TRILLION dollars, 16 followed by 12 zeros!! The number itself is staggering but the collective “shrug” of the populace concerning this outrageous profligacy is appalling and indicative of two things. First, it demonstrates how utterly incapable a very sizable majority of the populace is with fundamental mathematical and economic principles. Second, it emblazons the entitlement mentality across the sky in astronomical proportions!
A million seconds is 13 days.
A billion seconds is 31 years.
A trillion seconds is 31,688 years.
My conversations with a wide variety of people concerning federal spending make it abundantly and infuriatingly clear how pathetically inept people are with rudimentary mathematical concepts such as (gasp!) multiplication and exponents. Far too many “citizens” and “voters” the seem to think that the primary difference between a million, billion and trillion is merely a spelling issue involving the letters ‘M’, ‘B’, and ‘T’. There is little comprehension; much less appreciation, for the Reality of the thousand times each is multiplied to change that one little letter! Most people can grasp the impact that winning ‘The Lottery’ (Definition: a self imposed tax operating as a long-odds gambling scheme disguised as a ‘game’ to the “math challenged with the odds of winning roughly equivalent to the odds of being struck by a meteor) would have on their lives. However, very few comprehend that 16 BILLION equals 1,000 winners of such a jackpot. Assuming a two week cycle to reach a 16 million plus jackpot it would take ~40 years to have 1,000 jackpot winners in any game and pay out 16 billion. For our hypothetical winners to collectively win 16 Trillion dollars the game would have to go on for an additional ~40,000 years. This is just one way of trying to conceive of the number representing our current national debt. These are numbers that the “average voter” cannot comprehend and therefore has little concern about. Continue reading
We are beginning a new era in our government. I cannot too strongly urge the necessity of a rigid economy and an inflexible determination not to enlarge the income beyond the real necessities of the government.
President Andrew Jackson
I’m pleased to announce Prepography’s newest advertiser is Mozy Online Backup.
Here at Prepography we pride ourselves on helping people become more self reliant and prepare for the unexpected…even little disasters like a virus or hard drive failure. While there’s no substitution for a backup flash USB drive inside a Faraday cage (and hardcopy of your most important documents) there’s no reason not to have the convenience of daily, automatic backups…especially when it’s free (up to 2GB).
They have other plans available (I use the 3 computer, 125GB plan myself) but you can select just your desktop and documents folders and get by with the free 2GB plan if you aren’t a digital packrat like me. They’re even beta testing a cloud storage option to access your files from multiple locations (I haven’t tried this feature).
The initial upload takes a while, but after that it does a twice daily update that happens without my even noticing it (until it tells me it’s done). There’s also a nice little green circle with a check-mark that lets you know each file has been downloaded as well as you’re looking at your desktop or folder.
It’s free up to a whopping 2GB, easy (even for the non-technical) and only takes a few minutes to set up…give Mozy a try by clicking on the graphic below or the one at the right of this page.
As you can see from the Gross National Debt Counter to the left of this post (just under the Tags) the U.S. is rapidly approaching $16 Trillion in debt. That’s $16,000,000,000,000! If we take the National Debt and divide it by the population of the U.S. (311,591,917) then we have debt per capita of $51,349.21. That’s over a quarter million dollars owed for a family of five.
Andrew’s Note: Today we present an article by guest writer, Jay (Just Jay). Jay is a combat veteran, a knowledge manager by day and serial inventor by night. He’s had a number of interesting jobs through the years including collecting war trophies (like armored personnel carriers) in Iraq and a stint as a confidence course manager at a facility that used physical activity to build confidence in welfare recipients… to encourage them to work their way out of poverty. Yeah, that worked. Enjoy.
An amusing article was posted recently over at Movoto Blog [link] discussing the merits of various animals as lawn mowers. Once you get past the (really cool) calculator to determine how many of the animal of choice you’d need to tend your yard, there’s actually some interesting insights that could help not only your landscaping, but aid your self-reliance efforts and potential survivability.
According to the calculator, I would have to release an army of more than 200 guinea pigs to maintain my yard. Not sure what Homeland Security alarms will be sounded by ordering 200 guinea pigs from my local pet store, but might be worth it for the comic value alone.
The article gives a fun description of the merits of cows, goats, sheep, chickens, and yes, guinea pigs. It further describes the pros and cons of each. While livestock may not be a solution in all cases, it might be worth considering in the self-reliance quest beyond mere landscaping. Continue reading
Preparedness discussions often seem to devolve into what another preparedness writer describes as “beans, bullets & bandaids”…the ‘stuff’ of preparedness. However, your most important preparedness resources are the knowledge, skills, readiness and the confidence you develop as you become more self-reliant. You can enhance and develop these traits without spending any money if you are a little creative and put your mind to it.
The Top 10 Free Steps to Preparedness are:
For most of American history, government was tiny. But since Lyndon Johnson’s Great Society and the promise that government would cure poverty, spending has gone up nonstop. This is not sustainable.
Progressives say: If you’re so worried about the deficit, raise taxes! But it’s a fantasy to imagine that taxing the rich will solve our deficit problem. If the IRS grabbed 100 percent of income over $1 million, the take would be just $616 billion. That’s only a third of this year’s deficit.
It’s the spending, stupid.
Even if you could balance the budget by taxing the rich, it wouldn’t be right. Progressives say it’s wrong for the rich to be “given” more money. But money earned belongs to those who earn it, not to government. Lower taxes are not a handout.
That’s the moral side of the matter. There’s a practical side, too. Taxes discourage wealth creation.
Even if you think — despite all evidence — that government spends money more usefully than people in the private sector, there is a limit to how much government can tax before people work less or flee.
Progressives claim a small increase in tax rates won’t stop the wealthy from producing. But some would stop. When the top marginal rate was 90 percent, actor Ronald Reagan worked just half the year. He said that woke him up to the damage that high taxes impose.
Higher taxes give rich people and politicians more reasons to collude. The rich make contributions, and politicians pay the rich back by giving them tax loopholes.
That’s a big loss to America. That money and creative energy spent on figuring out taxes might have gone to build new products, make music, cure cancer or … who knows what?
There’s an economics principle I learned in college called ‘Opportunity Cost.’ Simply put the opportunity cost of an economic activity is the next best use you would have put that money to if you had not spent your money on that activity. For example, if you spend $100 fixing your car that you would have rather spend going to a baseball game than the opportunity cost of fixing your car was going to the game.
Whenever I hear politicians talking about increasing taxes I think of the opportunity cost of all that money. Don’t get me wrong, I don’t mind paying my fair share but the more our government spending has gone out of control in relation to our tax and fee income the more I resent calls for more taxes…on anybody. That money spent on taxes to fund increased government spending could have been spent on education (improving someone’s ability to create, build, teach or earn), consumer products or vacations (improving our economy), invested (funding further growth) or convinced an older worker that she had enough saved to retire (opening up a job for someone currently out of work). The true cost of taxes can only be measured in the opportunity cost of lost benefits that tax money would have been spent on as John Stossel describes in the last sentence of the quote above.
In my small business the recent and proposed tax increases have kept me from hiring additional full time workers that we desperately need to cover the workload and I hear the same story over and over from my friends who are entrepreneurs.
In the article I quoted above Stossel added:
Amazingly, we could grow our way out of debt if Congress simply froze spending at today’s levels. That would balance the budget by 2017. If spending growth were limited to just 2 percent per year, the budget would balance by 2020!
Not a bad start…but how about we actually pass a budget, freeze spending for the remainder of this year and begin reducing the budget by 5% per year (5% of government spending not GDP) until we go from spending 49% of our GDP on the federal, state & local government down to a more manageable 20%. Can you imagine what our economy would be capable of if only 20% was siphoned off for essential (arguably) but non-productive government services…before we knew it our economy would grow to the extent that our 20% in real dollar terms would be as big or bigger than our economy stifling 49% of GDP spending is now. I know…it’s an election year and the devil’s in the details…but if we don’t start taking dramatic steps we’re going to have a federal government going the way of Stockton, CA or Detroit, MI…broke.