by Tom Rhodes, 5/30/18
A primary driver of the American Revolution was, taxation without representation. Basically the idea that government can tax people and the people have no say in choosing those who create the taxes was not acceptable. Today we have that very problem and if not addressed it will lead to another revolution.
Do you believe that if your parents rack up $50,000 in credit card bills that you, now an emancipated adult living on your own, should have to repay your parents debt? After they die should the credit card company be allowed to force you to repay the dept your parents ran up even while you were long gone from your childhood home?
Even though you had no say in the debt, received little or no benefit from the debt, had no control over how big the debt got, should you have to repay that debt your parents incurred?
You having to repay the debt of your parents is essentially taxation without representation. You had no say in the borrowing but must repay the debt. Today's millennial's are having to repay baby boomer debt, that occurred long before they could vote. They are taxes massively for spending that they had no say. They didn't vote for the congressmen who borrowed and spent like drunken sailors, but do have to pay the tab.
It is immoral and unfair to burden our children with the debt we incurred. We should tax the old proportionate to the debt that was built up while they were old enough to vote. Baby boomers choose to spend money they didn't have, and now expect their grandchildren to pay it back. That is immoral and wrong.
Why should a man take a hard dangerous job to have a third of his pay go to paying off the debt his grandparents borrowed? Why not live at home in his parents or grandparents basement mooching of them, rather than work to repay their debt?
Those who kept electing politicians who, year after year, keep piling up the national debt, now in the untold trillions of dollars, not those too young to vote are responsible for that debt. Let those who borrowed the money have the burden of repaying the debt. Republicans and Democrats have done it and millennial's -- conservative or liberal -- have had nothing to do with it.
It's the parents and grand parents who have been piling debt upon the young, electing politicians who've spent and spent, refusing to cut, spending their children's birthright to get re-elected again and again, until the debt becomes so monstrous that it will crush the young, liberal or conservative, and grind them into dust.
Why should they work hard, and produce excess wealth, to repay the debt of Baby boomers?
If they become "woke" to the fact that they are paying for the excess of previous generations, what if they say, "No!, pay your own debts." and refuse to work, or refuse to pay taxes.
SocSec and Medicare for the elderly must be cut, they voted for all the spending, they should suffer the privation necessary to repay the debt they incurred. To do anything else is taxation without representation and can lead to revolution, and is immoral. The son isn't responsible for the sins of the father.
Showing posts with label Taxes. Show all posts
Showing posts with label Taxes. Show all posts
Wednesday, May 30, 2018
Friday, March 16, 2018
Libertarian Case For Tariffs
By Tom Rhodes, 3/16/2018
Government is a necessary evil. All the Utopian thinking will never make anarchy in any form a viable way to protect the freedom and liberty of society as a whole. Taxes to fund government are also necessary. There is no argument, tariffs are a form of taxes. When talking about taxes, we are discussing the funding government. Contemplating all revenue sources, tariffs should be rationally considered. If you want to fund government with just voluntary contributions you might as well believe leprechauns mix pixie dust with unicorn farts to turn into gold that you can find in pots at the end of a rainbow.
Governments exist for a lot of good reasons, including common defense. Governments have historically done a better job of defending borders than any other form of organization, and are certainly a damned sight better at it than international corporations. Those international corporations are government-created entities. In essence tariffs are a form of border defense. They can and do protect a nation from influence and actions of other nations in more ways than one.
Government is funded by taxes. Taxes can come from usage fees, sin taxes, tariffs, licensing fees, or direct taxation of individuals and/or corporations. Those direct taxes can come from income, or consumption tax, or taxing accumulated wealth. All taxes “manage the economy, ” tariffs are no more so than any other form of taxes.
Fundamental libertarian philosophy is that the less involved government is in an individual’s life the more liberty and freedom that individual has. Comparing different tax types, tariffs are considerably less intrusive, and cause less economic disruption, than any of the direct taxation alternatives; income taxes, consumption taxes, and wealth taxes. Publisher and author, Theodore Beale asks, “If you believe that government is a terrible way to get things done, why would you rather have it interfere on a holistic and daily basis with the economic activity of every single domestic citizen rather than on a far less frequent basis with the cross-border shipments of a limited number of foreign corporations?”
The large sway in US national politics from statist and government nanny Obama, to close down the EPA, Trump, is evidence that government is far more controllable by the people than international corporations like Google or Apple. Even knowing that the government is somewhat corrupt and clearly non efficient, having Government convey legal advantage to manufacturing companies that employ large numbers of people in a tariff system is far better than conveying advantage to Wall Street financial companies that do not in a free trade system.
The idea that all taxes are evil and society can exist without taxes and/or government is juvenile and absurd and is no more realistic than socialism with total control of the economy by some few ruling elite and just as dangerous. Government, and therefore taxes, are a necessary evil. Tariffs put more of the taxes on big companies that did the importing than direct taxation. Those big companies own the media, and buy off politicians. They have convinced so called “conservatives” and worse yet libertarians, that free-trade between nations is better, because it forces the individuals not big corporations to pay most of the taxes.
What’s better for a hundreds fat cats and international corporations on Wall Street is free-trade, that’s worse for millions of average workers in industries that were moved overseas to fatten the wallets of those same fat cats and international corporations. As a country we survived and thrived using tariffs not direct taxation on individual income until 1913. Tariffs as a system of taxation to fund that government is far less intrusive on individuals, than any direct taxation system. From a libertarian point of view, that alone makes it superior.
Before you start yelling “FREE TRADE” answer the question posed near the beginning of this article, “If you believe that government is a terrible way to get things done, why would you rather have it interfere on a holistic and daily basis with the economic activity of every single domestic citizen rather than on a far less frequent basis with the cross-border shipments of a limited number of foreign corporations?”
Government is a necessary evil. All the Utopian thinking will never make anarchy in any form a viable way to protect the freedom and liberty of society as a whole. Taxes to fund government are also necessary. There is no argument, tariffs are a form of taxes. When talking about taxes, we are discussing the funding government. Contemplating all revenue sources, tariffs should be rationally considered. If you want to fund government with just voluntary contributions you might as well believe leprechauns mix pixie dust with unicorn farts to turn into gold that you can find in pots at the end of a rainbow.
Governments exist for a lot of good reasons, including common defense. Governments have historically done a better job of defending borders than any other form of organization, and are certainly a damned sight better at it than international corporations. Those international corporations are government-created entities. In essence tariffs are a form of border defense. They can and do protect a nation from influence and actions of other nations in more ways than one.
Government is funded by taxes. Taxes can come from usage fees, sin taxes, tariffs, licensing fees, or direct taxation of individuals and/or corporations. Those direct taxes can come from income, or consumption tax, or taxing accumulated wealth. All taxes “manage the economy, ” tariffs are no more so than any other form of taxes.
Fundamental libertarian philosophy is that the less involved government is in an individual’s life the more liberty and freedom that individual has. Comparing different tax types, tariffs are considerably less intrusive, and cause less economic disruption, than any of the direct taxation alternatives; income taxes, consumption taxes, and wealth taxes. Publisher and author, Theodore Beale asks, “If you believe that government is a terrible way to get things done, why would you rather have it interfere on a holistic and daily basis with the economic activity of every single domestic citizen rather than on a far less frequent basis with the cross-border shipments of a limited number of foreign corporations?”
The large sway in US national politics from statist and government nanny Obama, to close down the EPA, Trump, is evidence that government is far more controllable by the people than international corporations like Google or Apple. Even knowing that the government is somewhat corrupt and clearly non efficient, having Government convey legal advantage to manufacturing companies that employ large numbers of people in a tariff system is far better than conveying advantage to Wall Street financial companies that do not in a free trade system.
The idea that all taxes are evil and society can exist without taxes and/or government is juvenile and absurd and is no more realistic than socialism with total control of the economy by some few ruling elite and just as dangerous. Government, and therefore taxes, are a necessary evil. Tariffs put more of the taxes on big companies that did the importing than direct taxation. Those big companies own the media, and buy off politicians. They have convinced so called “conservatives” and worse yet libertarians, that free-trade between nations is better, because it forces the individuals not big corporations to pay most of the taxes.
What’s better for a hundreds fat cats and international corporations on Wall Street is free-trade, that’s worse for millions of average workers in industries that were moved overseas to fatten the wallets of those same fat cats and international corporations. As a country we survived and thrived using tariffs not direct taxation on individual income until 1913. Tariffs as a system of taxation to fund that government is far less intrusive on individuals, than any direct taxation system. From a libertarian point of view, that alone makes it superior.
Before you start yelling “FREE TRADE” answer the question posed near the beginning of this article, “If you believe that government is a terrible way to get things done, why would you rather have it interfere on a holistic and daily basis with the economic activity of every single domestic citizen rather than on a far less frequent basis with the cross-border shipments of a limited number of foreign corporations?”
Monday, April 20, 2015
Not Stealing = Giving
By Tom Rhodes, 4/20/2015
Emily Badger and Christopher Ingraham of the Washington post lament your tax dollars being given to the rich. They claim the rich get handouts just like the poor and list 10 of them. They are sick people. The entire premise is that all of the money anybody earns or saves is the governments, and we should be grateful for that portion of what you earn that you are allowed to keep, people keeping what they earn is the same as the government giving it to them.
Does the list of handouts to the rich include direct subsidies for ethanol? Does the list of handouts to the rich include direct subsidies for “geen” energy? Does the list of handouts to the rich include direct subsidies for training your employees? Does the list of handouts to the rich include direct subsidies for agribusiness? Does the list of handouts to the Wall Street Fat Cats include TARP bailouts? The answer is no, no, no, no, no, and no.
The list from the Washington post doesn’t include a single subsidy, or payment of the government to the rich. There are a gazillion examples of the government giving your money to the rich, but none of these examples show up on Badger and Ingraham’s list of where the riche “receive benefits from government.” Their list exclusively includes people being allowed to keep their own money. Let’s examine their list:
1. The mortgage interest deduction for big houses and second homes. - Just like your home or condo, any place you can live that you have mortgaged, the interest is tax deductable. The rich have bigger mortgages and thus pay more interest and have bigger deductions, but no different than anybody else. The government isn't giving money, just not taking it, clearly not the same as SNAP benefits to the poor.
2. The yacht tax deduction. - not really a deduction for the yacht, if the yacht is big enough to live on, and is mortgaged, the interest from the mortgage like any other living space is tax deductible. The government isn't giving money, just not taking it, clearly not the same as WIC benefits to the poor.
3. Rental property. - How is allowing the deduction the costs associated with maintaining some rental property; repairs, mortgage, HOA fees, advertising to get renters, property taxes etc. and only being taxed on the net profits you earn from renting out your property the same as the government giving you a direct cash benefit? The Washing Post’s opinion is that if you get money from a rental, all that money, regardless of the associated expenses associated should be subject to confiscation. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
4. Fancy business meals. - Take a potential client to dinner and you get to deduct half the cost from your taxable income, doesn’t matter if it’s McDonalds or Burn’s Steakhouse. The fact is it’s a business expense. The government doesn’t pay a single business to take clients or employees out for a meal and discuss business. Somehow not taxing half of those expenses they are calling a handout. Nobody’s tax dollars were sent to any business to wine and dine others. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
5. The capital gains tax rate. - basically the Post is saying, not paying double taxes is considered a handout. The “preferential” rate in the current system for capital gains is more accurately saying the second tax on your money is less than the rate it was originally taxed at. Even if you believe that savings and investments should be double taxed, it is still not a government handout. The government doesn’t give, the person whose savings earned some additional amount, any money. Clearly this is not the same as any benefits to the poor.
6. The estate tax. - Mom and Dad save and invest, paying all appropriate taxes as they do so, any excess that is in their property or savings has already been taxed, sometimes two or three times. Somehow Badger and Ingraham are saying that not taking more of Mom and Dad’s property after they die is the same as the government LIHEAP program, directly paying for a poor persons heating bill. This is not a handout to the rich, the money’s been taxed already excessively and the government isn’t actually giving the inheritors a dime. The government is just not taking as much of it as the Post thinks they should. Clearly the Estate Tax is not the same as any benefits to the poor.
7. Gambling loss deductions. - This one is really stupid, the government taxes you total winnings from gambling just like any other income. Unlike other ways of earning money, if you gamble and you lose more than you win, you cannot deduct your losses from your income. For some reason the Washington Post’s opinion is that if you gamble, all you winnings should be taxed, even if you are a loser overall, not just the amount you won over the amount you lost. Again they think the expenses associated with any gross earnings, rental, gambling, business expenses, should not be deductable. But . . . even if you think all winnings should be taxed, too bad for you if you lose, not taking money from someone (taxing) is not the same as taking money from somebody else and giving it to that someone. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
8. The Social Security earnings limit. - Social Security was sold and is still sold to the American people as a retirement insurance package with top limits on what it will pay out. Because it is limited as to what it will pay out, it also limits what you must pay in. Again the idea is that not taking money in excess of what is due is somehow equal to the government giving a handout. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
9. Retirement plans. - Badger and Ingraham’s claim that not taxing money saved for retirement until it is actually used is a subsidy is absurd. IRA’s 401K’s etc. are incentives to get people to save, so that they are less of a burden on society in their old age. The money is taxed, just at a later date. They are lamenting the fact that responsible people are not taxed twice. All these retirement programs do is delay when the government extracts its pound of flesh. Somehow they equate the fact that the rich save more for retirement than the poor as a subsidy. How is not taking the savings of people who responsibly plan for their old age the same as giving them a handout? Again the government isn’t giving the rich a dime, just delaying when they take the money. Clearly not the same as any direct benefit to the poor
10. Tax prep. - I don’t get this one, the government understands that they have made doing your own taxes so convoluted that without a professional it’s nearly impossible for the average person to do their own taxes. Thus they rightly allow you to deduct the costs associated with doing your taxes from your gross income, an expense to business and individual alike the government has created. So the income wasted on a government required expense is not taxable. The idea is that not paying taxes on the money spent doing taxes is a handout. Because the rich spend more on tax prep the Washington Post believes that it’s the equal to SSI (direct subsidies to the blind and disabled). The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
In summary the idea is that the government has the right to all the money everybody earns, rich or poor, and that the state allows people to keep a portion of what they earn, and redistributes the rest as the state determines it is best used. The Washington Post equates the state allowing people to keep what they earn the same as the state giving money to others. Somehow the government not taking earnings as the same as giving a special handout. The idea is that the state, not the laborer, investor, worker, retiree, has the right to all wealth, even savings, and the state not the individual determines who receives that wealth. Like I said, this is a sick idea, the idea that the Government not stealing your money is the same as the government giving you money.
A burglar comes into your home, and at the point of a gun, takes your TV, stereo, cash on hand, and other valuables. You file some paperwork with the burglar complaining that he took too much. After a few months he returns your TV. According to the Newspeak out of the Washington Post, this is the same as giving you a handout. Newspeak definiton, Not Stealing = Giving.
Emily Badger and Christopher Ingraham of the Washington post lament your tax dollars being given to the rich. They claim the rich get handouts just like the poor and list 10 of them. They are sick people. The entire premise is that all of the money anybody earns or saves is the governments, and we should be grateful for that portion of what you earn that you are allowed to keep, people keeping what they earn is the same as the government giving it to them.
Does the list of handouts to the rich include direct subsidies for ethanol? Does the list of handouts to the rich include direct subsidies for “geen” energy? Does the list of handouts to the rich include direct subsidies for training your employees? Does the list of handouts to the rich include direct subsidies for agribusiness? Does the list of handouts to the Wall Street Fat Cats include TARP bailouts? The answer is no, no, no, no, no, and no.
The list from the Washington post doesn’t include a single subsidy, or payment of the government to the rich. There are a gazillion examples of the government giving your money to the rich, but none of these examples show up on Badger and Ingraham’s list of where the riche “receive benefits from government.” Their list exclusively includes people being allowed to keep their own money. Let’s examine their list:
1. The mortgage interest deduction for big houses and second homes. - Just like your home or condo, any place you can live that you have mortgaged, the interest is tax deductable. The rich have bigger mortgages and thus pay more interest and have bigger deductions, but no different than anybody else. The government isn't giving money, just not taking it, clearly not the same as SNAP benefits to the poor.
2. The yacht tax deduction. - not really a deduction for the yacht, if the yacht is big enough to live on, and is mortgaged, the interest from the mortgage like any other living space is tax deductible. The government isn't giving money, just not taking it, clearly not the same as WIC benefits to the poor.
3. Rental property. - How is allowing the deduction the costs associated with maintaining some rental property; repairs, mortgage, HOA fees, advertising to get renters, property taxes etc. and only being taxed on the net profits you earn from renting out your property the same as the government giving you a direct cash benefit? The Washing Post’s opinion is that if you get money from a rental, all that money, regardless of the associated expenses associated should be subject to confiscation. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
4. Fancy business meals. - Take a potential client to dinner and you get to deduct half the cost from your taxable income, doesn’t matter if it’s McDonalds or Burn’s Steakhouse. The fact is it’s a business expense. The government doesn’t pay a single business to take clients or employees out for a meal and discuss business. Somehow not taxing half of those expenses they are calling a handout. Nobody’s tax dollars were sent to any business to wine and dine others. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
5. The capital gains tax rate. - basically the Post is saying, not paying double taxes is considered a handout. The “preferential” rate in the current system for capital gains is more accurately saying the second tax on your money is less than the rate it was originally taxed at. Even if you believe that savings and investments should be double taxed, it is still not a government handout. The government doesn’t give, the person whose savings earned some additional amount, any money. Clearly this is not the same as any benefits to the poor.
6. The estate tax. - Mom and Dad save and invest, paying all appropriate taxes as they do so, any excess that is in their property or savings has already been taxed, sometimes two or three times. Somehow Badger and Ingraham are saying that not taking more of Mom and Dad’s property after they die is the same as the government LIHEAP program, directly paying for a poor persons heating bill. This is not a handout to the rich, the money’s been taxed already excessively and the government isn’t actually giving the inheritors a dime. The government is just not taking as much of it as the Post thinks they should. Clearly the Estate Tax is not the same as any benefits to the poor.
7. Gambling loss deductions. - This one is really stupid, the government taxes you total winnings from gambling just like any other income. Unlike other ways of earning money, if you gamble and you lose more than you win, you cannot deduct your losses from your income. For some reason the Washington Post’s opinion is that if you gamble, all you winnings should be taxed, even if you are a loser overall, not just the amount you won over the amount you lost. Again they think the expenses associated with any gross earnings, rental, gambling, business expenses, should not be deductable. But . . . even if you think all winnings should be taxed, too bad for you if you lose, not taking money from someone (taxing) is not the same as taking money from somebody else and giving it to that someone. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
8. The Social Security earnings limit. - Social Security was sold and is still sold to the American people as a retirement insurance package with top limits on what it will pay out. Because it is limited as to what it will pay out, it also limits what you must pay in. Again the idea is that not taking money in excess of what is due is somehow equal to the government giving a handout. The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
9. Retirement plans. - Badger and Ingraham’s claim that not taxing money saved for retirement until it is actually used is a subsidy is absurd. IRA’s 401K’s etc. are incentives to get people to save, so that they are less of a burden on society in their old age. The money is taxed, just at a later date. They are lamenting the fact that responsible people are not taxed twice. All these retirement programs do is delay when the government extracts its pound of flesh. Somehow they equate the fact that the rich save more for retirement than the poor as a subsidy. How is not taking the savings of people who responsibly plan for their old age the same as giving them a handout? Again the government isn’t giving the rich a dime, just delaying when they take the money. Clearly not the same as any direct benefit to the poor
10. Tax prep. - I don’t get this one, the government understands that they have made doing your own taxes so convoluted that without a professional it’s nearly impossible for the average person to do their own taxes. Thus they rightly allow you to deduct the costs associated with doing your taxes from your gross income, an expense to business and individual alike the government has created. So the income wasted on a government required expense is not taxable. The idea is that not paying taxes on the money spent doing taxes is a handout. Because the rich spend more on tax prep the Washington Post believes that it’s the equal to SSI (direct subsidies to the blind and disabled). The government isn't giving money, just not taking it, clearly not the same as any benefits to the poor.
In summary the idea is that the government has the right to all the money everybody earns, rich or poor, and that the state allows people to keep a portion of what they earn, and redistributes the rest as the state determines it is best used. The Washington Post equates the state allowing people to keep what they earn the same as the state giving money to others. Somehow the government not taking earnings as the same as giving a special handout. The idea is that the state, not the laborer, investor, worker, retiree, has the right to all wealth, even savings, and the state not the individual determines who receives that wealth. Like I said, this is a sick idea, the idea that the Government not stealing your money is the same as the government giving you money.
A burglar comes into your home, and at the point of a gun, takes your TV, stereo, cash on hand, and other valuables. You file some paperwork with the burglar complaining that he took too much. After a few months he returns your TV. According to the Newspeak out of the Washington Post, this is the same as giving you a handout. Newspeak definiton, Not Stealing = Giving.
Sunday, July 14, 2013
Volt Owners are Tax Dodging Scum
By Tom Rhodes, 7/14/2013
Chevy Volt a bad idea in 1913 a bad idea in 2013. For well over 100 years auto makers have been trying to sell electric cars as a better solution to the internal combustion engine. Here’s an ad from 2013.
For 100 years the technology has failed. The promises of better batteries soon to be developed that will be cheap to eliminate the range and other problems of the electric car in a century of development have never materialized. Battery tech has come a long way in the past 100 years but the Internal Combustion engine hasn’t been at a standstill either. The economic advantage of the EV vs IC is fiction. It’s a simple matter of chemistry; the energy density electric storage is not competitive with the energy density of gasoline. Of course the energy density of ethanol, hydrogen, propane, NG, etc, also make them less competitive, but for this article we’ll just look at costs over time and use of electricity vs gasoline.
Compare the Chevy Volt to the Chevy Cruz, they are the same platform vehicle made by the same company. We’ll use 3 year walk away leasing prices to determine the cost per mile of owning the EV power vs same car configured with IC power.
You can Leases for the Cruze for about $149/mo for 36 months with $1200 at signing, the Cruze gets 28 mpg city and 42 MPG hwy. Total cost to lease for 36 months is $6600. Testing shows the Cruze in the real world gets around 30mpg. So to drive it 12,000 miles a year for 3 years if Gas costs an average of $3.62 cents the total fuel costs over the life of the lease will be about $4400. Total cost of lease and fuel to drive the Cruze for 3 years is $11,000.
Leases for the Volt are now about $269 a month for 36 months, with $2,399 due at signing, the Volt get 38 miles per charge (we’ll assume you always drive less exactly 38 miles between charges and never use gasoline). Total cost to lease for 36 months is $12,100. The cost per charge for electricity is about $1.25, simple math shows electric cost for the 36,000 miles over the lease is about $1200. Total cost of lease and fuel to drive the Volt for 3 years is $13,300.
Comparison is simple cost to own and drive the same basic car IC vs EV and the conclusion is the same today as 100 years ago. Electric is a loser, over a 3 year lease a Volt costs over $2000 more to own than a Cruze and that’s only if you never put gas into the volt and limit yourself to 38 mile trips.
In the real world, people will drive the Volt on its gas engine, so spend more. Real world tests of the Volt using both Electricity and Gasoline it does admirably and gets around 60 mpg. So in the real world it’s fuel costs would be right hat half the Cruze’s fuel costs, totally about $2200. That means In the real world the Volt costs $4500 more over a 3 year lease to drive. The reality is that rationale people who need a car for transportation not to make a political statement, when given the choice between two pretty much identical vehicles will choose the one that cost’s less. GM sales and leases of the Cruze vs. Volt pretty much tell the story, in the real world the Volt goes up in flames.
Not only does buying a volt demonstrate you’re an economic idiot, if you own a Volt you’re a tax dodger just as guilty as GE or any other corporation that “evades” paying taxes. Not just the thousands of wasted tax dollars as an incentive to get you to make a stupid economic decision, but for every electric mile the Volt driver get’s the benefit of not paying taxes for the road use of her vehicle the same as Cruze driver pays, because of gasoline taxes. Using the same logic that slams Apple and GE for avoiding taxes, leasing a Volt makes you an immoral tax evader. An average of around 50 cents per gallon in taxes is paid over that same 3 year 36,000 mile lease lease driving a Cruze instead of a Volt. Volt drivers evades from $300 to $600 in taxes that the driver of the Cruze pays but still get’s to use the road that the Cruze driver’s taxes pay to maintain.
If the EV had to compete on a level playing field against IC we wouldn’t even have this discussion. The Detroit Electric Car tried to compete without government help, it lost, and it’s been out of business for 80 years. The physics of energy density cannot be beat by the desires of greenie-wienies who care about how they think things “should” be now how things are. To make them feel better about their stupid economic decision to buy a Volt, they are allowed to join the ranks of Microsoft, Apple, GM, GE, and millionaires everywhere and screw the people out of tax dollars; so not only are Volt owners economic idiots, they’re also tax dodging scum.
Chevy Volt a bad idea in 1913 a bad idea in 2013. For well over 100 years auto makers have been trying to sell electric cars as a better solution to the internal combustion engine. Here’s an ad from 2013.
For 100 years the technology has failed. The promises of better batteries soon to be developed that will be cheap to eliminate the range and other problems of the electric car in a century of development have never materialized. Battery tech has come a long way in the past 100 years but the Internal Combustion engine hasn’t been at a standstill either. The economic advantage of the EV vs IC is fiction. It’s a simple matter of chemistry; the energy density electric storage is not competitive with the energy density of gasoline. Of course the energy density of ethanol, hydrogen, propane, NG, etc, also make them less competitive, but for this article we’ll just look at costs over time and use of electricity vs gasoline.
Compare the Chevy Volt to the Chevy Cruz, they are the same platform vehicle made by the same company. We’ll use 3 year walk away leasing prices to determine the cost per mile of owning the EV power vs same car configured with IC power.
You can Leases for the Cruze for about $149/mo for 36 months with $1200 at signing, the Cruze gets 28 mpg city and 42 MPG hwy. Total cost to lease for 36 months is $6600. Testing shows the Cruze in the real world gets around 30mpg. So to drive it 12,000 miles a year for 3 years if Gas costs an average of $3.62 cents the total fuel costs over the life of the lease will be about $4400. Total cost of lease and fuel to drive the Cruze for 3 years is $11,000.
Leases for the Volt are now about $269 a month for 36 months, with $2,399 due at signing, the Volt get 38 miles per charge (we’ll assume you always drive less exactly 38 miles between charges and never use gasoline). Total cost to lease for 36 months is $12,100. The cost per charge for electricity is about $1.25, simple math shows electric cost for the 36,000 miles over the lease is about $1200. Total cost of lease and fuel to drive the Volt for 3 years is $13,300.
Comparison is simple cost to own and drive the same basic car IC vs EV and the conclusion is the same today as 100 years ago. Electric is a loser, over a 3 year lease a Volt costs over $2000 more to own than a Cruze and that’s only if you never put gas into the volt and limit yourself to 38 mile trips.
In the real world, people will drive the Volt on its gas engine, so spend more. Real world tests of the Volt using both Electricity and Gasoline it does admirably and gets around 60 mpg. So in the real world it’s fuel costs would be right hat half the Cruze’s fuel costs, totally about $2200. That means In the real world the Volt costs $4500 more over a 3 year lease to drive. The reality is that rationale people who need a car for transportation not to make a political statement, when given the choice between two pretty much identical vehicles will choose the one that cost’s less. GM sales and leases of the Cruze vs. Volt pretty much tell the story, in the real world the Volt goes up in flames.
Not only does buying a volt demonstrate you’re an economic idiot, if you own a Volt you’re a tax dodger just as guilty as GE or any other corporation that “evades” paying taxes. Not just the thousands of wasted tax dollars as an incentive to get you to make a stupid economic decision, but for every electric mile the Volt driver get’s the benefit of not paying taxes for the road use of her vehicle the same as Cruze driver pays, because of gasoline taxes. Using the same logic that slams Apple and GE for avoiding taxes, leasing a Volt makes you an immoral tax evader. An average of around 50 cents per gallon in taxes is paid over that same 3 year 36,000 mile lease lease driving a Cruze instead of a Volt. Volt drivers evades from $300 to $600 in taxes that the driver of the Cruze pays but still get’s to use the road that the Cruze driver’s taxes pay to maintain.
If the EV had to compete on a level playing field against IC we wouldn’t even have this discussion. The Detroit Electric Car tried to compete without government help, it lost, and it’s been out of business for 80 years. The physics of energy density cannot be beat by the desires of greenie-wienies who care about how they think things “should” be now how things are. To make them feel better about their stupid economic decision to buy a Volt, they are allowed to join the ranks of Microsoft, Apple, GM, GE, and millionaires everywhere and screw the people out of tax dollars; so not only are Volt owners economic idiots, they’re also tax dodging scum.
Wednesday, May 29, 2013
Solar Moochers
By Tom Rhodes, 5/29/2013
This is a tale of how being green puts a disproportionate burden on the poor and those on fixed incomes. That’s right putting solar on your house makes electricity cost more for the poor. So if you have the $50K upfront costs to spend to hook your house up to solar, and sell electricity back to the power company while using electricity from the grid at night and during storms etc. You can save a bundle and actually end up with the electric company sending you an annual check. (Read about it here)
This is well and good and green if you have the money. What many people don’t realize is that the power grid costs money, not just when it delivers watts of electricity to your home at night when your solar isn’t working, but towers, power lines, generating stations, all cost money to operate and maintain regardless of energy consumption. By law the power company must have enough power to supply you when you are not generating your own power, so whether you use it or not, if you are hooked up to the power grid the power company must maintain and be prepared to provide all the power you need, even if you don’t buy it. That means the power company must have capacity to replace all solar power instantly whether they need that capacity or not.
The result is that those consumers of electricity who rely fully on the power company shoulder a disproportionate share of the cost to maintain a reliable power grid as compared to those who only require the company’s services on an as-needed basis. Put another way: Customers with their own solar installations side-step the real cost of having access to the grid. That leaves those who can’t afford a $50K solar system to pick up the tab. Under the current regulations, low-income and fixed-income customers, and the vast majority of the middle class not rich enough to take advantage of personal solar generation, are subsidizing those who do.
To be fair for those who want to be able to hook up to the grid, regardless of how much power they use should be billed their fair share of the operations and maintenance associated with the most reliable power grid in the world. The reality is if you hook your solar system to the grid what you are doing is using the power company to store your solar power for when the sun isn’t shinning. That energy storage has costs.
The business model used by power companies last century, billing customers for kilowatt-hour consumption won’t work to cover the fixed costs associated with a reliable power grid that people only use as needed. There are fixed costs associated with reliability and service that do not vary with energy usage. What consumers pay for electric service needs to better reflect fixed costs versus consumption costs.
As it stands, unless you go totally off grid, “green” solar energy on your house is paid for on the backs of those who can’t afford tens of thousands of dollars to supplement their electricity with solar power. Most of the rich won’t go off grid because it adds tens of thousands of dollars to an already expensive system, and additionally adds significant maintenance costs associated with large battery banks (which will take up a big part of your garage).
The unintended consequences of government subsidies to individual solar power on homes is that not only are tax dollars used to help rich people go green, but the electricity costs to power the homes and apartments of low-income and fixed-income consumers are increased to cover the costs of the power grid so that the rich can have reliable power when the sun doesn’t shine, or their home system breaks down.
Solar power is a quaint way for the rich to mooch off of everybody else. We need to take government subsidies for solar power and stick them where the sun doesn’t shine.
This is a tale of how being green puts a disproportionate burden on the poor and those on fixed incomes. That’s right putting solar on your house makes electricity cost more for the poor. So if you have the $50K upfront costs to spend to hook your house up to solar, and sell electricity back to the power company while using electricity from the grid at night and during storms etc. You can save a bundle and actually end up with the electric company sending you an annual check. (Read about it here)
This is well and good and green if you have the money. What many people don’t realize is that the power grid costs money, not just when it delivers watts of electricity to your home at night when your solar isn’t working, but towers, power lines, generating stations, all cost money to operate and maintain regardless of energy consumption. By law the power company must have enough power to supply you when you are not generating your own power, so whether you use it or not, if you are hooked up to the power grid the power company must maintain and be prepared to provide all the power you need, even if you don’t buy it. That means the power company must have capacity to replace all solar power instantly whether they need that capacity or not.
The result is that those consumers of electricity who rely fully on the power company shoulder a disproportionate share of the cost to maintain a reliable power grid as compared to those who only require the company’s services on an as-needed basis. Put another way: Customers with their own solar installations side-step the real cost of having access to the grid. That leaves those who can’t afford a $50K solar system to pick up the tab. Under the current regulations, low-income and fixed-income customers, and the vast majority of the middle class not rich enough to take advantage of personal solar generation, are subsidizing those who do.
To be fair for those who want to be able to hook up to the grid, regardless of how much power they use should be billed their fair share of the operations and maintenance associated with the most reliable power grid in the world. The reality is if you hook your solar system to the grid what you are doing is using the power company to store your solar power for when the sun isn’t shinning. That energy storage has costs.
The business model used by power companies last century, billing customers for kilowatt-hour consumption won’t work to cover the fixed costs associated with a reliable power grid that people only use as needed. There are fixed costs associated with reliability and service that do not vary with energy usage. What consumers pay for electric service needs to better reflect fixed costs versus consumption costs.
As it stands, unless you go totally off grid, “green” solar energy on your house is paid for on the backs of those who can’t afford tens of thousands of dollars to supplement their electricity with solar power. Most of the rich won’t go off grid because it adds tens of thousands of dollars to an already expensive system, and additionally adds significant maintenance costs associated with large battery banks (which will take up a big part of your garage).
The unintended consequences of government subsidies to individual solar power on homes is that not only are tax dollars used to help rich people go green, but the electricity costs to power the homes and apartments of low-income and fixed-income consumers are increased to cover the costs of the power grid so that the rich can have reliable power when the sun doesn’t shine, or their home system breaks down.
Solar power is a quaint way for the rich to mooch off of everybody else. We need to take government subsidies for solar power and stick them where the sun doesn’t shine.
Tuesday, May 28, 2013
Following the Law is not Enough
By Tom Rhodes, 5/28/2013
A company that pays $16Million in taxes has its CEO brought before US Congress and publicly accused of keeping children out of early education, and the cause some seniors go without meals. WTF, that's outrageous! For breaking such laws the company should be fined to death. . . . Oops, they didn't break any law, they paid all the taxes they were required.
Senator Carl Levin denounced Apple CEO Tim Cook for contributing to the federal deficit, by following the law. To make is sound like Apple is some kind of evil corporation Levin used words like "loopholes" and "gimmicks" to describe the legal actions Apple used to minimize its tax burden. While grilling Tim Cook for obeying the law, Sen Levin noted that because of "gimmicks" used by businesses to reduce their taxes, "children across the country won't get early education from Head Start. Needy seniors will go without meals. Fighter jets sit idle on tarmacs because our military lacks the funding to keep pilots trained."
Tax loopholes and gimmicks are provisions in the tax law that let tax payers keep more of the money they earn than they would have if they didn't use those provisions in the law to minimize their taxes. Congress put those provisions into the law, how can they then berate and call before a Congressional committee people who follow the law.
Obviously Senator Carl Levin doesn't believe that people should be allowed to do what is legal if it isn't something the government wants. If Apple CEO Tim Cook has broken the law, then arrest him. If Apple as a corporation has broken the law, then fine them. If however they have not broken the law, then leave them alone.
The rule of law is a system in which the following four universal principles are upheld:
1) The government and its officials and agents as well as individuals and private entities are accountable under the law.
2) The laws are clear, publicized, stable and just, are applied evenly, and protect fundamental rights, including the security of persons and property.
3) The process by which the laws are enacted, administered and enforced is accessible, fair and efficient.
4) Justice is delivered timely by competent, ethical, and independent representatives and neutrals who are of sufficient number, have adequate resources, and reflect the makeup of the communities they serve.
What is evident is that the US Government, including the US Senate as represented by Sen. Levin, no longer operates on the Rule of Law. The current scandal laden administration is not holding government officials and agents accountable under the law; nor is the current tax code clear and stable and applied evenly; nor is the process which tax code applied fair and efficient; and nor is justice delivered timely by ethical people who reflect the communities they serve.
Apple paid all the taxes it was legally required to pay. Apple did not violate the law. If Congress doesn't want corporations or people to use loopholes and gimmicks then don't put them into the law. Senator Levin, and Congress need to stop trying to bully people and instead apply the law equally to all people and corporations, don't put any loopholes into laws that exempt some and not others (including themselves).
Sen. Levin seems to work under the assumption that all money is the Governments, and the people and corporations are only allowed to keep what the government allows. He ignores the fact that Apple earned every dollar it's earned in the USA by trading products to others voluntarily in exchange for money. The Money is theirs not the governments. Apple has a legal and moral obligation to only pay those taxes it is by law required to pay. It is under no legal or moral obligation to pay more in taxes than the law says it must pay.
If you used gimmicks like, saving in a 401K, the mortgage interest deduction, or student loan deduction, or state sales tax deduction, took advantage of an earned income tax credit, or even itemized to reduce your taxes, then you are just as guilty as Apple, and it is because you took those advantage of those loopholes put into the tax law by Congress that "children across the country won't get early education from Head Start. Needy seniors will go without meals. Fighter jets sit idle on tarmacs because our military lacks the funding to keep pilots trained."
A company that pays $16Million in taxes has its CEO brought before US Congress and publicly accused of keeping children out of early education, and the cause some seniors go without meals. WTF, that's outrageous! For breaking such laws the company should be fined to death. . . . Oops, they didn't break any law, they paid all the taxes they were required.
Senator Carl Levin denounced Apple CEO Tim Cook for contributing to the federal deficit, by following the law. To make is sound like Apple is some kind of evil corporation Levin used words like "loopholes" and "gimmicks" to describe the legal actions Apple used to minimize its tax burden. While grilling Tim Cook for obeying the law, Sen Levin noted that because of "gimmicks" used by businesses to reduce their taxes, "children across the country won't get early education from Head Start. Needy seniors will go without meals. Fighter jets sit idle on tarmacs because our military lacks the funding to keep pilots trained."
Tax loopholes and gimmicks are provisions in the tax law that let tax payers keep more of the money they earn than they would have if they didn't use those provisions in the law to minimize their taxes. Congress put those provisions into the law, how can they then berate and call before a Congressional committee people who follow the law.
Obviously Senator Carl Levin doesn't believe that people should be allowed to do what is legal if it isn't something the government wants. If Apple CEO Tim Cook has broken the law, then arrest him. If Apple as a corporation has broken the law, then fine them. If however they have not broken the law, then leave them alone.
The rule of law is a system in which the following four universal principles are upheld:
1) The government and its officials and agents as well as individuals and private entities are accountable under the law.
2) The laws are clear, publicized, stable and just, are applied evenly, and protect fundamental rights, including the security of persons and property.
3) The process by which the laws are enacted, administered and enforced is accessible, fair and efficient.
4) Justice is delivered timely by competent, ethical, and independent representatives and neutrals who are of sufficient number, have adequate resources, and reflect the makeup of the communities they serve.
What is evident is that the US Government, including the US Senate as represented by Sen. Levin, no longer operates on the Rule of Law. The current scandal laden administration is not holding government officials and agents accountable under the law; nor is the current tax code clear and stable and applied evenly; nor is the process which tax code applied fair and efficient; and nor is justice delivered timely by ethical people who reflect the communities they serve.
Apple paid all the taxes it was legally required to pay. Apple did not violate the law. If Congress doesn't want corporations or people to use loopholes and gimmicks then don't put them into the law. Senator Levin, and Congress need to stop trying to bully people and instead apply the law equally to all people and corporations, don't put any loopholes into laws that exempt some and not others (including themselves).
Sen. Levin seems to work under the assumption that all money is the Governments, and the people and corporations are only allowed to keep what the government allows. He ignores the fact that Apple earned every dollar it's earned in the USA by trading products to others voluntarily in exchange for money. The Money is theirs not the governments. Apple has a legal and moral obligation to only pay those taxes it is by law required to pay. It is under no legal or moral obligation to pay more in taxes than the law says it must pay.
If you used gimmicks like, saving in a 401K, the mortgage interest deduction, or student loan deduction, or state sales tax deduction, took advantage of an earned income tax credit, or even itemized to reduce your taxes, then you are just as guilty as Apple, and it is because you took those advantage of those loopholes put into the tax law by Congress that "children across the country won't get early education from Head Start. Needy seniors will go without meals. Fighter jets sit idle on tarmacs because our military lacks the funding to keep pilots trained."
Friday, May 17, 2013
You Trust Government . . . Have I Got A Deal for You
By Tom Rhodes, 5/17/2013
If you trust the government, specifically the Obama run federal government, I've got a deal for you. For a pittance you too can own an electric car only driven on Sundays by a little old lady that only needs recharging once every week. Such a deal.
If you believe the Internal Revenue Service has been completely honest about low level bureaucrats were responsible for the targeted attacks of the IRS, then I assume you'd be willing to purchase great homestead land I have available just Southwest of Lake Okeechobee.
If you believe that IRS' targeting Tea Party, Patriot, and Constitutional educations groups for special scrutiny for years wasn't politically motivated, then I assume you're interested in purchasing the shares in the Brooklyn Bridge.
If you believe the "apology" by the IRS should excuses the Obama administration of any legal responsibility for the IRS's actions, then I'm sure you'll be willing to send me a check so I can check out of the hotel where I'm being held until I can pay my bill after my wallet was stolen.
If you believe the Obama administration only knew about this abuse last week and quickly cleared the air publicly last Friday afternoon, then for a small upfront fee I'd be glad to conclude the research and facilitate the paper work to get the inheritance from you long lost uncle who recently died here in Nairobi?
If you believe the Obama administration has taken decisive action to ensure that all political abuse of and by the IRS has ceased, then I'm sure you'd be happy to send me a $250 annual fee for your pre-approved credit card, once I receive your check you will be issued a VISA with a 10,000 credit limit from the First Bank of Cyprus.
Let's face it; the credibility of Obama's administration has been reduced to that of Nigerian 419 Scam artists. Like Jon Stewart said, the burden of proof now lies with the Obama administration, not the tin-foil hat conspiracy nuts.
If you trust the government, specifically the Obama run federal government, I've got a deal for you. For a pittance you too can own an electric car only driven on Sundays by a little old lady that only needs recharging once every week. Such a deal.
If you believe the Internal Revenue Service has been completely honest about low level bureaucrats were responsible for the targeted attacks of the IRS, then I assume you'd be willing to purchase great homestead land I have available just Southwest of Lake Okeechobee.
If you believe that IRS' targeting Tea Party, Patriot, and Constitutional educations groups for special scrutiny for years wasn't politically motivated, then I assume you're interested in purchasing the shares in the Brooklyn Bridge.
If you believe the "apology" by the IRS should excuses the Obama administration of any legal responsibility for the IRS's actions, then I'm sure you'll be willing to send me a check so I can check out of the hotel where I'm being held until I can pay my bill after my wallet was stolen.
If you believe the Obama administration only knew about this abuse last week and quickly cleared the air publicly last Friday afternoon, then for a small upfront fee I'd be glad to conclude the research and facilitate the paper work to get the inheritance from you long lost uncle who recently died here in Nairobi?
If you believe the Obama administration has taken decisive action to ensure that all political abuse of and by the IRS has ceased, then I'm sure you'd be happy to send me a $250 annual fee for your pre-approved credit card, once I receive your check you will be issued a VISA with a 10,000 credit limit from the First Bank of Cyprus.
Let's face it; the credibility of Obama's administration has been reduced to that of Nigerian 419 Scam artists. Like Jon Stewart said, the burden of proof now lies with the Obama administration, not the tin-foil hat conspiracy nuts.
Thursday, April 18, 2013
Throwaway Society
By Tom Rhodes, 4/18/2013
Environmentalists, leftists, and statists lament the fact that we live in a throwaway society. Where rather than fix or recycle something our society suffers from over-consumption. The source is almost always attributed to greedy capitalists. What if it isn’t greedy capitalists, but the natural reaction to the actual costs of having too much government? First we need to look at the costs of goods, not the price.
No they are not the same. The price is the dollar figure used to transact a trade of goods or services between people, not the cost. The cost includes intangibles such as time, effort, travel costs, etc. Gasoline costs $3.50 a gallon where I live in Citrus County, South of me in Hernando Co. I can purchase gas for $3.20 a gallon. I don’t drive 40 miles south to save 20 cents a gallon on the purchase price because the cost in wear and tear on my vehicle, miles driven, and my time mean paying 20 cents more locally is more cost effective even though the price is higher. That’s just using the easily visible intangible costs to that gallon of gas.
The true cost includes what I had to do to get that $3.50 to trade for the gallon of gas. I’m in a tax bracket that results in me receiving only 72% of my contracted salary, the Federal Government gets the rest. So for me have $3.50 in my pocket I have to do $4.86 of work. I’ll use easy numbers to explain this. If I earned $35/hr and was allowed to keep all the fruit of my labor, I exchange an hour of work for 10 gallons of gas, however, because the government makes prior claims to my labor, I either need to earn $49/hr or work 1.4 hours to get that same 10 gallons of gas.
Now if instead of gas it was a repair service. Say I have a washing machine that needs to be fixed. The repair man says he can fix it for $200 and I’m willing to fix it for $200. Problem solved, but….. the government gets involved and the repair man is taxed and pays both the employee and employer side of the taxes. So instead of him gaining $200 for that repair he only nets $120. His time and effort doing other things has value to him, so to make repairing that washing machine a viable transaction he has to charge me $333. Not so Fast, I’m willing to pay $200 to do the repair, but at $333, not so much. In fact rather than pay $333 to fix a 5 year old machine, I haul it to the metal scrapper and get $10 for scrap metal and purchase a new unit for $500. The unintended consequence of the taxes extracted by government is that many transactions just don’t happen because the costs make them nonviable. People can and do change their behavior based on taxes, so raising taxes has historically proven not to garner corresponding increases in revenue.
Rather than repair and recycle we routinely toss out and replace, because to repair and recycle is cost prohibitive, not necessarily just the price of the unit. Why have a computer printer repaired. A typical diagnosis and repair of a printer takes about 2 hours, to be profitable, pay the wages, insurance, and taxes required by government means that to do computer/printer repairs, a shop must charge $50 to $100/hr or more. So minimally without any parts a printer repair will be in the $100 range. Considering high quality printers can be purchased for as little as $50, who would repair one. Intangibles in computer repair include such things as regulations in dealing with disposing of old circuit boards etc. increasing costs disproportionate to the price the market will bear. Recycling them is equally cost prohibitive. Why take the parts from 3 or 4 broken printers and build 1 or 2 good working units and have spare parts, when it would take a skilled technician 3-4 hours to do that work. If the tax burden on skilled labor and other regulatory costs weren’t so high, repair of printers, and other small appliances, would be viable.
How about plastic blister packaging now used for just about everything? Believe it or not that can also be attributed to too much government. Retail stores used to have clerks who knew what they were selling, and more importantly could monitor the counter, small expensive items would be kept in a counter and the customer would be served. Because government taxes and minimum wage laws make hiring entry people more expensive, it is more cost (not price) effective to put them in plastic blister packs, too big to easily conceal to protect against theft, and have fewer clerks to service customers. Rather than have a clerk count 1 or 2 items from a box of 100 for the customer, small expensive items are in big blister packs, resulting in massive amounts of plastic waste in our landfills. There is no reason for a 4X6” packaging for a micro-SD memory card, but the alternative is having people control their sale, the result is less jobs and more waste because the cost of low skilled labor is artificially greater than income it generates. RFID chips, plastic blister packs, etc. are all created because the costs are lower than having people actually provide low skill services in retail. Minimum wage and income taxes helped create throwaway society.
People don’t just look at price they look at TCO, total cost of ownership. Because government interference has dramatically increased the costs to do business, we’ve become a throwaway society, where we accept goods from sources that don’t have our massive government burden. When I was young there were many small appliance repair shops across the country, where for a reasonable fee you could have your toaster fixed, new brushes put into the motor of your mixer, etc. Technology and automation killed that type of business, new products last longer and just don’t break as much, or can be sold so cheaply (because they are built by robots) that replacement costs less than repair. This is one of the unintended consequences of more and more government, regulations and taxes make fixing things too expensive.
Environmentalists, leftists, and statists lament the fact that we live in a throwaway society. Where rather than fix or recycle something our society suffers from over-consumption. The source is almost always attributed to greedy capitalists. What if it isn’t greedy capitalists, but the natural reaction to the actual costs of having too much government? First we need to look at the costs of goods, not the price.
No they are not the same. The price is the dollar figure used to transact a trade of goods or services between people, not the cost. The cost includes intangibles such as time, effort, travel costs, etc. Gasoline costs $3.50 a gallon where I live in Citrus County, South of me in Hernando Co. I can purchase gas for $3.20 a gallon. I don’t drive 40 miles south to save 20 cents a gallon on the purchase price because the cost in wear and tear on my vehicle, miles driven, and my time mean paying 20 cents more locally is more cost effective even though the price is higher. That’s just using the easily visible intangible costs to that gallon of gas.
The true cost includes what I had to do to get that $3.50 to trade for the gallon of gas. I’m in a tax bracket that results in me receiving only 72% of my contracted salary, the Federal Government gets the rest. So for me have $3.50 in my pocket I have to do $4.86 of work. I’ll use easy numbers to explain this. If I earned $35/hr and was allowed to keep all the fruit of my labor, I exchange an hour of work for 10 gallons of gas, however, because the government makes prior claims to my labor, I either need to earn $49/hr or work 1.4 hours to get that same 10 gallons of gas.
Now if instead of gas it was a repair service. Say I have a washing machine that needs to be fixed. The repair man says he can fix it for $200 and I’m willing to fix it for $200. Problem solved, but….. the government gets involved and the repair man is taxed and pays both the employee and employer side of the taxes. So instead of him gaining $200 for that repair he only nets $120. His time and effort doing other things has value to him, so to make repairing that washing machine a viable transaction he has to charge me $333. Not so Fast, I’m willing to pay $200 to do the repair, but at $333, not so much. In fact rather than pay $333 to fix a 5 year old machine, I haul it to the metal scrapper and get $10 for scrap metal and purchase a new unit for $500. The unintended consequence of the taxes extracted by government is that many transactions just don’t happen because the costs make them nonviable. People can and do change their behavior based on taxes, so raising taxes has historically proven not to garner corresponding increases in revenue.
Rather than repair and recycle we routinely toss out and replace, because to repair and recycle is cost prohibitive, not necessarily just the price of the unit. Why have a computer printer repaired. A typical diagnosis and repair of a printer takes about 2 hours, to be profitable, pay the wages, insurance, and taxes required by government means that to do computer/printer repairs, a shop must charge $50 to $100/hr or more. So minimally without any parts a printer repair will be in the $100 range. Considering high quality printers can be purchased for as little as $50, who would repair one. Intangibles in computer repair include such things as regulations in dealing with disposing of old circuit boards etc. increasing costs disproportionate to the price the market will bear. Recycling them is equally cost prohibitive. Why take the parts from 3 or 4 broken printers and build 1 or 2 good working units and have spare parts, when it would take a skilled technician 3-4 hours to do that work. If the tax burden on skilled labor and other regulatory costs weren’t so high, repair of printers, and other small appliances, would be viable.
How about plastic blister packaging now used for just about everything? Believe it or not that can also be attributed to too much government. Retail stores used to have clerks who knew what they were selling, and more importantly could monitor the counter, small expensive items would be kept in a counter and the customer would be served. Because government taxes and minimum wage laws make hiring entry people more expensive, it is more cost (not price) effective to put them in plastic blister packs, too big to easily conceal to protect against theft, and have fewer clerks to service customers. Rather than have a clerk count 1 or 2 items from a box of 100 for the customer, small expensive items are in big blister packs, resulting in massive amounts of plastic waste in our landfills. There is no reason for a 4X6” packaging for a micro-SD memory card, but the alternative is having people control their sale, the result is less jobs and more waste because the cost of low skilled labor is artificially greater than income it generates. RFID chips, plastic blister packs, etc. are all created because the costs are lower than having people actually provide low skill services in retail. Minimum wage and income taxes helped create throwaway society.
People don’t just look at price they look at TCO, total cost of ownership. Because government interference has dramatically increased the costs to do business, we’ve become a throwaway society, where we accept goods from sources that don’t have our massive government burden. When I was young there were many small appliance repair shops across the country, where for a reasonable fee you could have your toaster fixed, new brushes put into the motor of your mixer, etc. Technology and automation killed that type of business, new products last longer and just don’t break as much, or can be sold so cheaply (because they are built by robots) that replacement costs less than repair. This is one of the unintended consequences of more and more government, regulations and taxes make fixing things too expensive.
Monday, April 15, 2013
Spending – Is Charity a Proper Use of Government Tax Dollars
Tax Day, a perfect day to review the well reasoned letter by Col Davy Crockett, explaining exactly why "entitlements" and other charity spending are not appropriate use of our tax dollars, not the job of our government, and why we pay way too much in taxes.
Enjoy
Not Yours To Give
by Col. Davy Crockett
One day in the House of Representatives, a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer. Several beautiful speeches had been made in its support. The Speaker was just about to put the question when Crockett arose:
"Mr. Speaker --- I have as much respect for the memory of the deceased, and as much sympathy for the suffering of the living, if suffering there be, as any man in this house, but we must not permit our respect for the dead or our sympathy for a part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has no power to appropriate this money as an act of charity. Every member upon this floor knows it. We have the right, as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I have never heard that the government was in arrears to him."
"Every man in this House knows it is not a debt. We cannot, without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as a charity. Mr. Speaker, I have said we have the right to give as much money of our own as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week's pay to the object, and, if every member of Congress will do the same, it will amount to more than the bill asks."
He took his seat. Nobody replied. The bill was put upon its passage, and, instead of passing unanimously, as was generally supposed, and as, no doubt it would but for that speech, it received but few votes and of course, was lost.
Later when asked by a friend why he had opposed the appropriation, Crockett gave this explanation:
"Several years ago I was one evening standing on the steps of the Capitol with some other members of Congress when our attention was attracted by a great light over in Georgetown. It was evidently a large fire. We jumped into a hack and drove over as fast we could. In spite of all that could be done, many houses were burned and many families made houseless, and besides, some of them had lost all but the clothes they had on. The weather was very cold, and when I saw so many women and children suffering, I felt that something ought to be done for them. The next morning a bill was introduced appropriating $20,000 for their relief. We put aside all other business and rushed it through as soon as it could be done.
The next summer, when it began to be time to think about the election, I concluded I would take a scout around among the boys of my district. I had no opposition there, but, as the election was some time off, I did not know what might turn up. When riding one day in part of my district in which I was more of a stranger than any other, I saw a man in a field plowing and coming toward the road. I gauged my gait so that I should meet as he came to the fence. As he came up, I spoke to the man. He replied politely, but as I thought, rather coldly.
I began, 'Well, friend, I am one of those unfortunate beings called candidates, and-'
'Yes, I know you; you are Colonel Crockett, I have seen you once before and voted for you the last time you were elected. I suppose you are out electioneering right now, but you had better not waste your time or mine. I shall not vote for you again.'
This was a sockdolager, I begged him to tell me what was the matter.
'Well, Colonel, it is hardly worth while to waste time or words upon it. I do not see how it can be mended, but you gave a vote last winter which shows that either you have not capacity to understand the Constitution, or that you are wanting in the honesty and firmness to be guided by it. In either case you are not the man to represent me. But I beg your pardon for expressing it in that way. I did not intend to avail myself of the privilege of the constituent to speak plainly to a candidate for the purpose of insulting or wounding you.
I intend by it only to say that your understanding of the Constitution is very different from mine; and I will say to you what, but for my rudeness, I should not have said that I believe you to be honest. But an understanding of the Constitution different from mine I cannot overlook because the Constitution, to be worth anything, must be held sacred and rigidly observed in all its provisions. The man who wields power and misinterprets it, is the more dangerous the more honest he is.'
'I admit the truth of all you say, but there must be some mistake about it, for I do not remember that I gave any vote last winter upon any constitutional questions.'
'No, Colonel, there is no mistake. Though I live here in the backwoods and seldom go from home, I take the papers from Washington and read very carefully all the proceedings in Congress. My papers say that last winter you voted for a bill to appropriate $20,000 to some sufferers by a fire in Georgetown. Is that true?'
'Well, my friend, I may as well own up. You have got me there. But certainly nobody will complain that a great and rich country like ours should give the insignificant amount of $20,000 to relive its suffering women and children, particularly with a full and overflowing Treasury, and I am sure, if you had been there, you would have done just as I did.'
'It is not the amount, Colonel, that I complain of, it is the principle. In the first place, the government ought to have in the Treasury no more than enough for its legitimate purposes. But that has nothing to do with the question. The power of collecting and disbursing money at pleasure is the most dangerous power that can be intrusted to man, particularly under our system of collecting revenue by a tariff, which reaches every man in the country, no matter how poor he may be and the poorer he is, the more he pays in proportion to his means.
What is worse, it presses upon him without his knowledge where the weight centers, for there is not a man in the United States who can ever guess how much he pays to the government. So you see, that while you are contributing to relieve one, you are drawing it from thousands who are even worse off than he. If you had the right to give anything, the amount was simply a matter of discretion with you, and you had as much right to give $20,000,000 as $20,000.
If you had the right to give to one, you have the right to give to all and as the Constitution neither defines charity nor stipulates the amount, you are at liberty to give to any and everything which you may believe, or profess to believe, is a charity, and to any amount you may think proper. You will very easily perceive what a wide door this would open for fraud and corruption and favoritism on the one hand, and for robbing the people on the other. No, Colonel, Congress has no right to give charity.
Individual members may give as much of their own money as they please, but they have no right to touch a dollar of the public money for that purpose. If twice as many houses had been burned in this country as in Georgetown, neither you nor any other member of Congress would have thought to appropriating a dollar for our relief. There are about two hundred and forty members of Congress. If they had shown their sympathy for the sufferers by contributing each one week's pay, it would have made over $13,000. There are plenty of men in and around Washington who could have given $20,000 without depriving themselves of even a luxury of life.
The Congressmen chose to keep their own money, which, if reports to be true, some of them spend not very credibly; and the people about Washington, no doubt, applauded you for relieving them from the necessity of giving by giving what was not yours to give. The people have delegated to Congress, by the Constitution, the power to do certain things. To do these, it is authorized to collect and pay moneys, and for nothing else. Everything beyond this is usurpation and a violation of the Constitution.
So you see, Colonel, you have violated the Constitution in what I consider a vital point. It is a precedent fraught with danger for the country, for when Congress once begins to stretch its power beyond the limits of the Constitution, there is no limit to it and no security for the people. I have no doubt you acted honestly, but that does not make it any better, except as far as you are personally concerned and you see that I cannot vote for you.'
'I tell you I felt streaked. I saw if I should have opposition, and this man should go talking, he would set others to talking and in that district I was a gone fawn-skin. I could not answer him and the fact is, I was so fully convinced that he was right, I did not want to. But I must satisfy him and I said to him:
Well, my friend, you hit the nail upon the head when you said I had not sense enough to understand the Constitution. I intended to be guided by it and thought I had studied it fully. I have head many speeches in Congress about the powers of Congress, but what you have said here at your plow has got more hard, sound sense in it than all the fine speeches I ever heard. If I had ever taken the view of it that you have, I would have put my head into the fire before I would have given that vote; and if you will forgive me and vote for me again, if I ever vote for another unconstitutional law, I wish I may be shot.'
He haughtingly replied: 'Yes, Colonel, you have sworn to that once before, but I will trust you again upon one condition. You say that you are convinced that your vote was wrong. Your acknowledgment of it will do more good than beating you for it. If, as you go around the district, you will tell people about this vote and that you are satisfied it was wrong, I will not only vote for you, but will do what I can to keep down opposition, and perhaps, I may exert some little influence in that way.'
'If I don't, I said, I wish I may be shot, and to convince you that I am in earnest in what I say, I will come back this way in a week or ten days, and if you will get up a gathering of the people, I will make a speech to them. Get up a barbeque and I will pay for it.'
No, Colonel, we are not rich people in this section, but we have plenty of provisions to contribute for a barbeque and some to spare for those who have none. The push of crops will be over in a few days and we can afford a day for a barbeque. This is Thursday. I will see to getting up on Saturday week. Come to my house on Friday and we will go together and I promise you a very respectable crowd to see and hear you.'
'Well, I will be there. But one thing more before I say good-bye. I must know your name.'
'My name is Bunce.'
'Not Horatio Bunce?'
'Yes.'
'Well, Mr. Bunce, I never saw you before though you say you have seen me, but I know you very well. I am glad I have met you and very proud that I may hope to have you for my friend.'
It was one of the luckiest hits of my life that I met him. He mingled but little with the public, but was widely known for his remarkable intelligence and incorruptible integrity and for a heart brimful and running over with kindness and benevolence, which showed themselves not only in words but in acts. He was the oracle of the whole country around him, and his fame had extended far beyond the circle of his immediate acquaintance. Though I had never met him before, I had heard much of him, and but for this meeting it is very likely I should have had opposition, and have been beaten. One thing is very certain, no man could now stand up in that district under such a vote.
At the appointed time I was at his house, having told our conversation to every crowd I had met, and to every man I stayed all night with, and I found that it gave the people an interest and a confidence in me stronger than I had ever seen manifested before. Though I was considerably fatigued when I reached his house, and under ordinary circumstances, should have gone early to bed, I kept up until midnight talking about the principles and affairs of government, and got more real, true knowledge of them than I had got all my life before.
I have known and seen much of him since, for I respect him - no, that is not the world - I reverence and love him more than any living man, and I go to see him two or three times every year; and I will tell you, sir, if every one who professes to be a Christian lived and acted and enjoyed as he does, the religion of Christ would take the world by storm.
But, to return to my story. The next morning I went to the barbeque and to my surprise, found about a thousand men there. I met a good many whom I had not known before, and they and my friend introduced me around until I had got pretty well acquainted - at least, they all knew me. In due time notice was given that I would speak to them. They gathered up around a stand that had been erected. I opened by speech by saying:
Fellow-citizens - I present myself before you today feeling like a new man. My eyes have lately been opened to truths which ignorance or prejudice, or both, had heretofore hidden from my view. I feel that I can today offer you the ability to render you more valuable service than I have ever been able to render before. I am here today more for the purpose of acknowledging my error than to see your votes. That I should make this acknowledgment is due to myself as well as to you. Whether you will vote for me is a matter for your consideration only.
I went on to tell them about the fire and my vote for the appropriation and then told them why I was satisfied it was wrong. I closed by saying:
And now, fellow citizens, it remains only for me to tell you that most of the speech you have listened to with so much interest was simply a repetition of the arguments by which your neighbor, Mr. Bunce, convinced me of my error. It is the best speech I ever made in my life, but he is entitled to the credit for it. And now I hope he is satisfied with his convert and that he will get up here and tell you so. He came upon the stand and said:
'Fellow citizens, it affords me great pleasure to comply with the request of Colonel Crockett. I have always considered him a thoroughly honest man, and I am satisfied that he will faithfully perform all that he has promised to you today.'
He went down, and there went up from that crowd such a shout for Davy Crockett as his name never called forth before. I am not much given to tears, but I was taken with a choking then and felt some big drops rolling down my cheeks. And I tell you now that the remembrance of those few words spoken by such a man, and the honest, hearty shout they produced, is worth more to me than all the reputation I have ever made, or ever shall make, as a member of Congress."
"Now, sir," concluded Crockett, "you know why I made that speech yesterday."
Friday, February 1, 2013
Marriage Truth and Taxes
By Tom Rhodes, 2/1/13
The uncomfortable truth surrounding the marriage issue is that heterosexual couples have long been subsidized by their unwed neighbors. Rather than recognize the inherit unfairness of granting those who choose to be in a contractual relationship with another special privileges and rights that others don’t have, and eliminate all marriage tax preferences and treat it like any other contract, homosexuals want some of their number who choose to enter into contractual relationships the same benefits over single people. If we had a fair and just government, marriage contracts would be just that, contracts. They would convey no special benefits beyond the terms agreed upon. The result would be that religious individuals and institutions with conscientious objections to homosexuality would never be forced to violate their conscience.
The entire issue is caused by Too Much Government. Government that has gone beyond its core mission and responsibility has again proven to cause more problems than it fixes. Because the government has taken the function that for centuries was the purview of the church and stepped clearly beyond the powers granted to it, we now have a divisive issue in politics that should never have existed. Making marriage a tax issue and the government taking the authority to sanction marriage from the church has created a system that is unjust, unfair.
Government overstepping its bounds on taxation is the root of our problems. To attempt to socially engineer our society the government gives some people different tax rates than others, based on what private contractual agreements they enter. This is unjust on its face. What is the moral justification for a voluntary private contract between two individuals being what determines that taxing someone earning $25,000 a year at a differently than anybody else making $25,000 per year who has no contract with another?
The government using tens of thousands of pages of tax code to socially engineer society is obviously an abject failure. It is a method of “legally” instituting Neo-Feudalism and concentrating power in the hands of a few. It can be clearly seen when the favorites of the ruling elite, GE corporation, literally have to pay no taxes is favored by the ruling elite, while the everyday worker is oppressively taxed, and threatened with financial ruin for even challenging his taxes. You have to be exceptionally brave (stupid), be exceptionally poor, or have exceptional connections to the ruling elite to consider challenging the IRS. We need radical tax changes.
I’d prefer the Fair Tax, because consumption taxes disproportionately hit those who use more of the products and services society provides. The fact is that won’t happen in the current environment, so were stuck taxing the income not outflow of peoples finances. That said if the we’d all be a lot better off if IRS 1040 form looked like this:
No it’s not a perfect solution, but within our current legal and social structures it is viable. It’s not viable to congress because it takes away their gifting and power to control through taxation. It does however insure the poor not only don’t pay taxes, but get more back than they pay in, and although a “flat” tax its implementation is progressive. It also does away with any penalty or benefit to marriage. It is a just and fair method.
Let’s look at how a household of 4 people would be taxed at various incomes: If this family of four’s earnings was a mere $16K per year (minimum wage for one wage earner), not only wouldn’t they owe a dime in taxes but would receive a refund of an additional $3600, call it an “earned income tax credit,” effectively giving that family a 22% increase in their earnings. In fact until a family of four’s total earnings exceed $36K not only would they pay zero taxes but would get some extra back. A family of four earning $50K would only pay $2520 in taxes, while if they earned $100K they would pay $11,500 in taxes, and the mythical $400K earning family of 4 would pay $65,500 in taxes. Although seemingly flat, that in implementation is quite a progressive tax system. The key would be other than the standard deduction for a taxpayer and dependents there are no other deductions – PERIOD.
The elegant solution to the marriage penalty/benefit is the deductions. Every person is entitled to one deduction whether against their own wages or their spouses, significant other, or other “head of household” age is no barrier. If you end up supporting your parents in old age you can take a deduction from your taxes. One spouse, two spouses, no spouse, it doesn’t matter, each wage earner is entitled to $16,000 tax free and an additional $5,000 for every person they support including themselves, relationship is irrelevant. If you are a dependent of another person you can’t deduct yourself. This is fair, a wage earner gets to take a deduction for every person they support. Since everybody has a social security number, finding those who would try to double dip would be simple.
Do you see the hidden marriage bonus? It’s there, but it doesn’t care if it’s a legal marriage, gay marriage, or just casual cohabitation. Assume you have a household of 4 earning a total of $36,000 per year but instead of 1 wage earner it’s made of 2 wage earners. Since every individual files a tax return, and the total dependents for the two returns is still 4 (2 dependents on each return). Each wage earner would receive $1800 (total of $3600) “earned income tax credit” while if it was a single provider earning $36,000 with a total of 4 dependents would get zero earned income tax credit.
This would end the need for any gay marriage laws and most of the reason for the current battle between gays and the religious right. Unless of course the goal isn’t equality under the law, but to force churches and others to recognize gay unions as morally equal to strait unions. This would be using the government to force changes in religious beliefs, and clearly violate the First Amendment. In as much as we know the homosexuals only want equality, not to force others to abolish or change their religious beliefs, then this elegant simplification of the tax code should have their support. It eliminates the disparity between “married” couples and other couples. All the government would be doing is protecting individuals equally in legally binding contracts; marriage would again be the purview of the church, and none of the governments business.
The other rational for this would be the elimination of tens of thousands of pages of legal graft. The IRS tax code and laws are unequal and unjust. This would produce a far fairer and better solution to our current tax problems. Radical changes to our tax code, with radical simplification, would be a huge benefit to all of America.
The uncomfortable truth surrounding the marriage issue is that heterosexual couples have long been subsidized by their unwed neighbors. Rather than recognize the inherit unfairness of granting those who choose to be in a contractual relationship with another special privileges and rights that others don’t have, and eliminate all marriage tax preferences and treat it like any other contract, homosexuals want some of their number who choose to enter into contractual relationships the same benefits over single people. If we had a fair and just government, marriage contracts would be just that, contracts. They would convey no special benefits beyond the terms agreed upon. The result would be that religious individuals and institutions with conscientious objections to homosexuality would never be forced to violate their conscience.
The entire issue is caused by Too Much Government. Government that has gone beyond its core mission and responsibility has again proven to cause more problems than it fixes. Because the government has taken the function that for centuries was the purview of the church and stepped clearly beyond the powers granted to it, we now have a divisive issue in politics that should never have existed. Making marriage a tax issue and the government taking the authority to sanction marriage from the church has created a system that is unjust, unfair.
Government overstepping its bounds on taxation is the root of our problems. To attempt to socially engineer our society the government gives some people different tax rates than others, based on what private contractual agreements they enter. This is unjust on its face. What is the moral justification for a voluntary private contract between two individuals being what determines that taxing someone earning $25,000 a year at a differently than anybody else making $25,000 per year who has no contract with another?
The government using tens of thousands of pages of tax code to socially engineer society is obviously an abject failure. It is a method of “legally” instituting Neo-Feudalism and concentrating power in the hands of a few. It can be clearly seen when the favorites of the ruling elite, GE corporation, literally have to pay no taxes is favored by the ruling elite, while the everyday worker is oppressively taxed, and threatened with financial ruin for even challenging his taxes. You have to be exceptionally brave (stupid), be exceptionally poor, or have exceptional connections to the ruling elite to consider challenging the IRS. We need radical tax changes.
I’d prefer the Fair Tax, because consumption taxes disproportionately hit those who use more of the products and services society provides. The fact is that won’t happen in the current environment, so were stuck taxing the income not outflow of peoples finances. That said if the we’d all be a lot better off if IRS 1040 form looked like this:
No it’s not a perfect solution, but within our current legal and social structures it is viable. It’s not viable to congress because it takes away their gifting and power to control through taxation. It does however insure the poor not only don’t pay taxes, but get more back than they pay in, and although a “flat” tax its implementation is progressive. It also does away with any penalty or benefit to marriage. It is a just and fair method.
Let’s look at how a household of 4 people would be taxed at various incomes: If this family of four’s earnings was a mere $16K per year (minimum wage for one wage earner), not only wouldn’t they owe a dime in taxes but would receive a refund of an additional $3600, call it an “earned income tax credit,” effectively giving that family a 22% increase in their earnings. In fact until a family of four’s total earnings exceed $36K not only would they pay zero taxes but would get some extra back. A family of four earning $50K would only pay $2520 in taxes, while if they earned $100K they would pay $11,500 in taxes, and the mythical $400K earning family of 4 would pay $65,500 in taxes. Although seemingly flat, that in implementation is quite a progressive tax system. The key would be other than the standard deduction for a taxpayer and dependents there are no other deductions – PERIOD.
The elegant solution to the marriage penalty/benefit is the deductions. Every person is entitled to one deduction whether against their own wages or their spouses, significant other, or other “head of household” age is no barrier. If you end up supporting your parents in old age you can take a deduction from your taxes. One spouse, two spouses, no spouse, it doesn’t matter, each wage earner is entitled to $16,000 tax free and an additional $5,000 for every person they support including themselves, relationship is irrelevant. If you are a dependent of another person you can’t deduct yourself. This is fair, a wage earner gets to take a deduction for every person they support. Since everybody has a social security number, finding those who would try to double dip would be simple.
Do you see the hidden marriage bonus? It’s there, but it doesn’t care if it’s a legal marriage, gay marriage, or just casual cohabitation. Assume you have a household of 4 earning a total of $36,000 per year but instead of 1 wage earner it’s made of 2 wage earners. Since every individual files a tax return, and the total dependents for the two returns is still 4 (2 dependents on each return). Each wage earner would receive $1800 (total of $3600) “earned income tax credit” while if it was a single provider earning $36,000 with a total of 4 dependents would get zero earned income tax credit.
This would end the need for any gay marriage laws and most of the reason for the current battle between gays and the religious right. Unless of course the goal isn’t equality under the law, but to force churches and others to recognize gay unions as morally equal to strait unions. This would be using the government to force changes in religious beliefs, and clearly violate the First Amendment. In as much as we know the homosexuals only want equality, not to force others to abolish or change their religious beliefs, then this elegant simplification of the tax code should have their support. It eliminates the disparity between “married” couples and other couples. All the government would be doing is protecting individuals equally in legally binding contracts; marriage would again be the purview of the church, and none of the governments business.
The other rational for this would be the elimination of tens of thousands of pages of legal graft. The IRS tax code and laws are unequal and unjust. This would produce a far fairer and better solution to our current tax problems. Radical changes to our tax code, with radical simplification, would be a huge benefit to all of America.
Friday, January 4, 2013
Forced Obligation
By Tom Rhodes, 1/4/2013
Should the wages of a young person be garnished to make the car payment for their parent? Is it fair for a child to have to repay the credit card debt and mortgage of their grand parents? Should we as a society jail those children who refuse to pay off the medical expenses of their
For good reasons children are not treated like adults, nor expected to have the same responsibilities. In fact by law a minor you cannot enter into any contract nor held accountable for the foolishness of somebody lending them money before they are 18 years of age. The reason is that children are not mature enough nor developed enough to make such decisions. In fact even if an legally an "adult" there are things we don't allow you to purchase or use until you are 21, like alcohol and hand guns. These rules are in general good and appropriate restrictions on people whose frontal lobes are not fully developed. Physiologically human brains cannot adequately judge the future consequences of actions until the frontal lobes are fully (or nearly fully) developed. This is a scientific fact, and our laws and restrictions on youth, like not being allowed to drive until 16 years of age, are reasonable and justified.
For rational reasons we are not legally nor morally responsible for actions as minors when we become adults. So to consent to any legal obligation you must be 18 years of age. Now we have a problem because old people are legally obligating minors to $180,000 of debt. Once a person turns 18, they immediately have $180,000 of debt that they must pay as their share of the debt incurred by their grandparents. This is morally reprehensible.
What will we do if those people say "I didn't consent to that debt, so won't pay it." Worse yet you know how they will pay it, they will inflate the money, so that they don't pay $180,000 with equal value. They will devalue their grandparent's holdings, lie about inflation numbers, so that they can keep more value of their earnings and in real value only pay pennies on the dollar. Grandma and Grandpa's nest egg is going to be worth squat. They are forcing today's children to pay for their lavish life style. Most of the wealth of the USA is in the hands of old people, not young people. If Social Security and Medicare were means tested, the benefits could be increased to those in need, and still cost a lot less. But the Ponzi Scheme that is Social Security puts the burden on our youth.
Our youth is not stupid, they will inflate the money so that their wages are dramatically higher in absolute numbers (not value) than their parents and grand parents, but pay back the debt they didn't agree to incur, with dollars worth less than when the debt was created. That or they will have to do like Karl Denninger proposes and refuse to pay.
So if the youth are forced to repay a debt that they didn't consent to through taxes imposed by people they had no choice in selecting (can't vote until your 18) what choice do they have? Didn't we revolt and succeed from England over Taxation without Representation. The young entering the work force start out with a debt of $180,000 that they never consenting to borrowing. They aren't going to pay it, they will find a way to make Grandma and Grandpa account for that money one way or another; either refusal to pay for it outright or so inflate the currency that it won't matter. Inflation has been their primary means for 30 years. Look at Shadow Stats web page, where they show what inflation would look like if we still counted it the way we did in 1980. Real inflation has been as much as 10% in recent years, but our government has have rigged it so that they only report 2% or so, in order to repay the debt grandma and grandpa forced on us, with inflated dollars. They get a 2%COLA, while their dollar buys much less. In effect taxing the retirement savings and payments to old people by the difference and forcing the old to actually pay at least part of the debt they incurred.
We cannot keep kicking the can down the road, future generations did not consent to borrow money today, so they could pay it back tomorrow. Children have no legal or moral obligation to repay their parent's and grandparent's debts. They will find a way to avoid repaying those debts. Greece is defaulting; the US will likely suffer the same fate. I live in Florida, where Seniors move to retire, they vote for absurdly low property taxes, and to defund schools, saying "I pay high taxes up north to send my kids to school, I shouldn't have to pay to send more kids to school." In their retirement, their "income" is dramatically lower, they get tax differed earnings that they don't pay taxes on, and receive social security, medicare, and other benefits far in excess of what they paid into the system. Yet expect those same kids to pay more in taxes to pay off the debt they committed to. The fact is that old people have the money, not the young, they refuse to pay the young(real wages are lower), and even employ them (unemployment for those under 24 is at depression levels); the result will be healthcare rationing for the old, death panels, smaller COLA's, inflation to devalue savings.
There are and will be repercussions from Baby Boomers sticking future generations with $180,000 of debt each; and the Senior Citizens are not going to like them. The youth will say screw it, develop some disability or other means of having the government support them instead of working, they will use or change the system to avoid the massive tax liability they now have. After all what obligation do they have to repay money they never consented to borrowing?
Should the wages of a young person be garnished to make the car payment for their parent? Is it fair for a child to have to repay the credit card debt and mortgage of their grand parents? Should we as a society jail those children who refuse to pay off the medical expenses of their
For good reasons children are not treated like adults, nor expected to have the same responsibilities. In fact by law a minor you cannot enter into any contract nor held accountable for the foolishness of somebody lending them money before they are 18 years of age. The reason is that children are not mature enough nor developed enough to make such decisions. In fact even if an legally an "adult" there are things we don't allow you to purchase or use until you are 21, like alcohol and hand guns. These rules are in general good and appropriate restrictions on people whose frontal lobes are not fully developed. Physiologically human brains cannot adequately judge the future consequences of actions until the frontal lobes are fully (or nearly fully) developed. This is a scientific fact, and our laws and restrictions on youth, like not being allowed to drive until 16 years of age, are reasonable and justified.
For rational reasons we are not legally nor morally responsible for actions as minors when we become adults. So to consent to any legal obligation you must be 18 years of age. Now we have a problem because old people are legally obligating minors to $180,000 of debt. Once a person turns 18, they immediately have $180,000 of debt that they must pay as their share of the debt incurred by their grandparents. This is morally reprehensible.
What will we do if those people say "I didn't consent to that debt, so won't pay it." Worse yet you know how they will pay it, they will inflate the money, so that they don't pay $180,000 with equal value. They will devalue their grandparent's holdings, lie about inflation numbers, so that they can keep more value of their earnings and in real value only pay pennies on the dollar. Grandma and Grandpa's nest egg is going to be worth squat. They are forcing today's children to pay for their lavish life style. Most of the wealth of the USA is in the hands of old people, not young people. If Social Security and Medicare were means tested, the benefits could be increased to those in need, and still cost a lot less. But the Ponzi Scheme that is Social Security puts the burden on our youth.
Our youth is not stupid, they will inflate the money so that their wages are dramatically higher in absolute numbers (not value) than their parents and grand parents, but pay back the debt they didn't agree to incur, with dollars worth less than when the debt was created. That or they will have to do like Karl Denninger proposes and refuse to pay.
So if the youth are forced to repay a debt that they didn't consent to through taxes imposed by people they had no choice in selecting (can't vote until your 18) what choice do they have? Didn't we revolt and succeed from England over Taxation without Representation. The young entering the work force start out with a debt of $180,000 that they never consenting to borrowing. They aren't going to pay it, they will find a way to make Grandma and Grandpa account for that money one way or another; either refusal to pay for it outright or so inflate the currency that it won't matter. Inflation has been their primary means for 30 years. Look at Shadow Stats web page, where they show what inflation would look like if we still counted it the way we did in 1980. Real inflation has been as much as 10% in recent years, but our government has have rigged it so that they only report 2% or so, in order to repay the debt grandma and grandpa forced on us, with inflated dollars. They get a 2%COLA, while their dollar buys much less. In effect taxing the retirement savings and payments to old people by the difference and forcing the old to actually pay at least part of the debt they incurred.
We cannot keep kicking the can down the road, future generations did not consent to borrow money today, so they could pay it back tomorrow. Children have no legal or moral obligation to repay their parent's and grandparent's debts. They will find a way to avoid repaying those debts. Greece is defaulting; the US will likely suffer the same fate. I live in Florida, where Seniors move to retire, they vote for absurdly low property taxes, and to defund schools, saying "I pay high taxes up north to send my kids to school, I shouldn't have to pay to send more kids to school." In their retirement, their "income" is dramatically lower, they get tax differed earnings that they don't pay taxes on, and receive social security, medicare, and other benefits far in excess of what they paid into the system. Yet expect those same kids to pay more in taxes to pay off the debt they committed to. The fact is that old people have the money, not the young, they refuse to pay the young(real wages are lower), and even employ them (unemployment for those under 24 is at depression levels); the result will be healthcare rationing for the old, death panels, smaller COLA's, inflation to devalue savings.
There are and will be repercussions from Baby Boomers sticking future generations with $180,000 of debt each; and the Senior Citizens are not going to like them. The youth will say screw it, develop some disability or other means of having the government support them instead of working, they will use or change the system to avoid the massive tax liability they now have. After all what obligation do they have to repay money they never consented to borrowing?
Monday, October 8, 2012
Taxes Used to Violate Rights
By Tom Rhodes, 10/8/2012
Last Sunday was Pulpit Freedom Sunday. As Libertarians we should celebrate the bravery of the hundreds of pastors who thumbed their nose at the IRS and preached about politicians and politics in defiance to the government. The idea that the first amendment allows the state to regulate the speech of the church is absurd. The entire Bill of Rights it is a limit on the government not the people or any organization which they form and belong. Pastors not the government should determine what is said from the pulpit.
Statist arguments from those who say to pastors, "If you want to exercise your right to free speech, just give up your tax-exempt status" are illogical and absurd on their face. It would be the same as telling everyone that in order to deduct your homes mortgage interest from your taxes you must give up your right to be free from warrantless searches of your home. The idea is that because the government is in essence paying for your house with a tax deduction it has the right to search your house any time for any reason or for no reason at all. That idea is invalid on many fronts.
It makes as much sense as saying, "if you want to maintain your right to a jury trial, just give up your tax-exempt status." Just like a jury trial, and the right to keep and bear arms, and the right not to testify against yourself, are all rights not privileges grated by the government which can be taken away based on an arbitrary tax classification, the right to free speech and religion is just that, constitutionally protected rights, not privileges that can be revoked by dangling the tax-exempt status of a pastor's church over his head. The IRS rule against free speech for pastors should be declared unconstitutional.
Tax cuts or exemptions do not "subsidize" religion or anything else. An IRS tax-exempt status to a church is not a subsidy unless all money belongs to the government. Last year the US Supreme Court rejected that idea. Justice Anthony Kennedy wrote for the majority in Arizona Christian School Tuition Organization v. Winn. "Like contributions that lead to charitable tax deductions, contributions yielding STO tax credits are not owed to the State and, in fact, pass directly from taxpayers to private organizations. Respondents' contrary position assumes that income should be treated as if it were government property even if it has not come into the tax collector's hands. That premise finds no basis in standing jurisprudence. Private bank accounts cannot be equated with the Arizona State Treasury." It is clear that the government has no automatic right to a church's money because a pastor doesn't give up his right to free speech. There is no right for the government to be free from the church or from the beliefs of the citizens; rather the government is restricted from restricting free speech and the free exercise of religion. Our constitution doesn't restrict churches or pastors or the people, it restricts the government.
Whether a group is formed to promote model aviation (the AMA) or promote doctors (the AMA) or promote motorcycle racing (the AMA), or promote management training (the AMA), or to market marketing (the AMA), or to give music awards (the AMA), or promote a religion, or promote a group of workers, they should all have the same rules applied equally, and all have their rights respected equally. Any other position is unjust. Charities are non-profits and have been outside the legitimate tax base since the founding of our nation. Our government has no more right to a church's money because its pastor won't give up his constitutionally protected right to free speech, than it has the right to curb the speech of any other non-profit, like the AMA, ACLU, PETA, VFW, or AFL-CIO.
If you think that because an individual receives a tax deduction for contributions to a church as being a benefit that justifies restricting the freedom of speech from the pulpit, why isn't that claim as true for any other organization that you can receive a tax deduction when you make a donation. Should the United Way have its free speech squelched? Why should churches be treated any differently?
Union dues are tax deductable and unions are tax exempt, if churches can't promote or endorse a candidate without losing their tax exempt status why can unions? I know the IRS classifies churches as 501(C)3 organizations and Unions as 501(C)5 organizations, but it is illogical, absurd, and reprehensible to limit the speech rights of a group of people for some arbitrary classification by the government; especially when it is the government and not the people or any assembly of people that is constitutionally limited.
If you support the idea that pastors should not be allowed to endorse or financially support candidates then you must support the idea unions should not be allowed to endorse candidates. As libertarians we can and do support all forms of free speech, even that of pastors to endorse and criticize candidates from the pulpit. Last Sunday 1600 pastors were brave enough to stand up to statism, we salute all of you who took up the challenge. Our current tax system is now being used to control and restrict our constitutionally protected freedoms, it is time to scrap the entire thing and start over.
Last Sunday was Pulpit Freedom Sunday. As Libertarians we should celebrate the bravery of the hundreds of pastors who thumbed their nose at the IRS and preached about politicians and politics in defiance to the government. The idea that the first amendment allows the state to regulate the speech of the church is absurd. The entire Bill of Rights it is a limit on the government not the people or any organization which they form and belong. Pastors not the government should determine what is said from the pulpit.
Statist arguments from those who say to pastors, "If you want to exercise your right to free speech, just give up your tax-exempt status" are illogical and absurd on their face. It would be the same as telling everyone that in order to deduct your homes mortgage interest from your taxes you must give up your right to be free from warrantless searches of your home. The idea is that because the government is in essence paying for your house with a tax deduction it has the right to search your house any time for any reason or for no reason at all. That idea is invalid on many fronts.
It makes as much sense as saying, "if you want to maintain your right to a jury trial, just give up your tax-exempt status." Just like a jury trial, and the right to keep and bear arms, and the right not to testify against yourself, are all rights not privileges grated by the government which can be taken away based on an arbitrary tax classification, the right to free speech and religion is just that, constitutionally protected rights, not privileges that can be revoked by dangling the tax-exempt status of a pastor's church over his head. The IRS rule against free speech for pastors should be declared unconstitutional.
Tax cuts or exemptions do not "subsidize" religion or anything else. An IRS tax-exempt status to a church is not a subsidy unless all money belongs to the government. Last year the US Supreme Court rejected that idea. Justice Anthony Kennedy wrote for the majority in Arizona Christian School Tuition Organization v. Winn. "Like contributions that lead to charitable tax deductions, contributions yielding STO tax credits are not owed to the State and, in fact, pass directly from taxpayers to private organizations. Respondents' contrary position assumes that income should be treated as if it were government property even if it has not come into the tax collector's hands. That premise finds no basis in standing jurisprudence. Private bank accounts cannot be equated with the Arizona State Treasury." It is clear that the government has no automatic right to a church's money because a pastor doesn't give up his right to free speech. There is no right for the government to be free from the church or from the beliefs of the citizens; rather the government is restricted from restricting free speech and the free exercise of religion. Our constitution doesn't restrict churches or pastors or the people, it restricts the government.
Whether a group is formed to promote model aviation (the AMA) or promote doctors (the AMA) or promote motorcycle racing (the AMA), or promote management training (the AMA), or to market marketing (the AMA), or to give music awards (the AMA), or promote a religion, or promote a group of workers, they should all have the same rules applied equally, and all have their rights respected equally. Any other position is unjust. Charities are non-profits and have been outside the legitimate tax base since the founding of our nation. Our government has no more right to a church's money because its pastor won't give up his constitutionally protected right to free speech, than it has the right to curb the speech of any other non-profit, like the AMA, ACLU, PETA, VFW, or AFL-CIO.
If you think that because an individual receives a tax deduction for contributions to a church as being a benefit that justifies restricting the freedom of speech from the pulpit, why isn't that claim as true for any other organization that you can receive a tax deduction when you make a donation. Should the United Way have its free speech squelched? Why should churches be treated any differently?
Union dues are tax deductable and unions are tax exempt, if churches can't promote or endorse a candidate without losing their tax exempt status why can unions? I know the IRS classifies churches as 501(C)3 organizations and Unions as 501(C)5 organizations, but it is illogical, absurd, and reprehensible to limit the speech rights of a group of people for some arbitrary classification by the government; especially when it is the government and not the people or any assembly of people that is constitutionally limited.
If you support the idea that pastors should not be allowed to endorse or financially support candidates then you must support the idea unions should not be allowed to endorse candidates. As libertarians we can and do support all forms of free speech, even that of pastors to endorse and criticize candidates from the pulpit. Last Sunday 1600 pastors were brave enough to stand up to statism, we salute all of you who took up the challenge. Our current tax system is now being used to control and restrict our constitutionally protected freedoms, it is time to scrap the entire thing and start over.
Tuesday, July 17, 2012
Obamacare Reality
By Tom Rhodes, 7/17/2012
Now that the SCOTUS has resolved Obamacare is constitutional, and not paying Obamacare will result in a Tax, the law now makes it so that nobody has to have insurance. Because all pre-existing conditions must be covered by insurance companies nobody has to purchase insurance until they are sick and need it. You can opt out without paying any penalty saving thousands of dollars a year until you're sick.
Look at the facts. Obamacare forces insurance companies to take everybody and charge them the same, regardless of health. The result will be higher premiums, and encourage people to delay purchasing medical insurance until they need it. As insurance gets more expensive more people will delay purchasing it, so insurance will get more expensive and even more people will delay purchasing it, this is a cycle that will kill Obamacare and possibly all of healthcare in the USA.
Yes there is a tax associated with not buying insurance, it is far less than the cost of insurance, but the tax is optional, and you can ignore it. The fact is the way Obamacare is written, the IRS has no power to levy liens, force forfeiture, or prosecute those who refuse to pay the Obamacare tax. The IRS's only power is to withhold tax refunds. Fill out your W2 correctly and you end up not getting a tax refund or owing a little, then you don't get a refund; if you have no refund the IRS can't withhold it. You can pay zero tax and not have insurance until you find out you need it. Thus without fear you can even avoid the Obamacare tax. Any communications from the IRS trying to entice or scare tax payers to pay the Obamacare Tax will be ineffective because there is zero chance of penalty; once the public learns ignoring the Obamacare Tax results in zero problems why pay the tax. Just like not paying sales tax for your Amazon.com purchase.
Just as without any moral compulsion virtually everybody breaks the law everyday, we don't pay sales tax on items we buy on the internet, don't report cash income, roll through stop signs at 3am, have sex out of wedlock (still illegal in some places), etc. The overcriminalization of society means that disobedience to Obamacare will be wide spread. Because our government has so overstepped its bounds, the people no longer feel it is wrong to "cheat" the government.
There is no moral rationale for paying the Obamacare tax; Obamacare forcing insurance companies to charge the same and offer insurance regardless of existing health now makes it financially advantageous to go without insurance until after you need it. Obamacare cannot last; too bad our health care system will probably be ruined before Obamacare dies.
Now that the SCOTUS has resolved Obamacare is constitutional, and not paying Obamacare will result in a Tax, the law now makes it so that nobody has to have insurance. Because all pre-existing conditions must be covered by insurance companies nobody has to purchase insurance until they are sick and need it. You can opt out without paying any penalty saving thousands of dollars a year until you're sick.
Look at the facts. Obamacare forces insurance companies to take everybody and charge them the same, regardless of health. The result will be higher premiums, and encourage people to delay purchasing medical insurance until they need it. As insurance gets more expensive more people will delay purchasing it, so insurance will get more expensive and even more people will delay purchasing it, this is a cycle that will kill Obamacare and possibly all of healthcare in the USA.
Yes there is a tax associated with not buying insurance, it is far less than the cost of insurance, but the tax is optional, and you can ignore it. The fact is the way Obamacare is written, the IRS has no power to levy liens, force forfeiture, or prosecute those who refuse to pay the Obamacare tax. The IRS's only power is to withhold tax refunds. Fill out your W2 correctly and you end up not getting a tax refund or owing a little, then you don't get a refund; if you have no refund the IRS can't withhold it. You can pay zero tax and not have insurance until you find out you need it. Thus without fear you can even avoid the Obamacare tax. Any communications from the IRS trying to entice or scare tax payers to pay the Obamacare Tax will be ineffective because there is zero chance of penalty; once the public learns ignoring the Obamacare Tax results in zero problems why pay the tax. Just like not paying sales tax for your Amazon.com purchase.
Just as without any moral compulsion virtually everybody breaks the law everyday, we don't pay sales tax on items we buy on the internet, don't report cash income, roll through stop signs at 3am, have sex out of wedlock (still illegal in some places), etc. The overcriminalization of society means that disobedience to Obamacare will be wide spread. Because our government has so overstepped its bounds, the people no longer feel it is wrong to "cheat" the government.
There is no moral rationale for paying the Obamacare tax; Obamacare forcing insurance companies to charge the same and offer insurance regardless of existing health now makes it financially advantageous to go without insurance until after you need it. Obamacare cannot last; too bad our health care system will probably be ruined before Obamacare dies.
Thursday, May 10, 2012
New York Town Implements Libertarian Taxing Strategy
By Tom Rhodes 5/10/2012
New Rochelle N.Y., looking at decreased revenue and increased costs, like many US towns is strapped for cash. Being responsible to its citizens and recognizing that they have limited funds, in their 2012 budget New Rochelle eliminated some of their towns holiday celebrations including their Fourth of July Fireworks, their Memorial Day and Thanksgiving Parades. Although these civic events are very important they took the responsible action.
Canceling these events saves the citizens of New Rochelle $135,000. Such austerity measures are hard to accept for many people, and the city of New Rochelle wants to put these events on for its businesses, citizens, and community. So rather than raise taxes or borrow money, they have asked for citizens for VOLUNTARILY support (tax themselves) to pay for these traditional holiday celebrations.
So far these targeted donations have covered the cost of the Memorial Day parade, and it looks like donations will also cover the Thanksgiving parade. These Parades cost $30,000 each. It doesn't look like they will collect enough to put on the July 4th Fireworks, at $75,000 it is a substantial cost.
New Rochelle Mayor, Noam Bramson, said New Rochelle is in a "time of fiscal challenge" and depends on the support of donations to help out. What an awesome position for a town to take, that it can and does depend upon its citizens and business community to make the right decisions about what the town can and can't do. No, it hasn't eliminated property taxes, but it is a huge step in the right direction. A town recognizing that it governs and provides services at the consent of the governed, including "depending" upon citizen and local businesses to support for such actions as parades, fireworks, etc. is the reality of implementing of libertarian ideology.
If you want to support a town calling for truly voluntary not forced taxation, for the communities luxuries you can donate by calling 914-654-2087.
New Rochelle N.Y., looking at decreased revenue and increased costs, like many US towns is strapped for cash. Being responsible to its citizens and recognizing that they have limited funds, in their 2012 budget New Rochelle eliminated some of their towns holiday celebrations including their Fourth of July Fireworks, their Memorial Day and Thanksgiving Parades. Although these civic events are very important they took the responsible action.
Canceling these events saves the citizens of New Rochelle $135,000. Such austerity measures are hard to accept for many people, and the city of New Rochelle wants to put these events on for its businesses, citizens, and community. So rather than raise taxes or borrow money, they have asked for citizens for VOLUNTARILY support (tax themselves) to pay for these traditional holiday celebrations.
So far these targeted donations have covered the cost of the Memorial Day parade, and it looks like donations will also cover the Thanksgiving parade. These Parades cost $30,000 each. It doesn't look like they will collect enough to put on the July 4th Fireworks, at $75,000 it is a substantial cost.
New Rochelle Mayor, Noam Bramson, said New Rochelle is in a "time of fiscal challenge" and depends on the support of donations to help out. What an awesome position for a town to take, that it can and does depend upon its citizens and business community to make the right decisions about what the town can and can't do. No, it hasn't eliminated property taxes, but it is a huge step in the right direction. A town recognizing that it governs and provides services at the consent of the governed, including "depending" upon citizen and local businesses to support for such actions as parades, fireworks, etc. is the reality of implementing of libertarian ideology.
If you want to support a town calling for truly voluntary not forced taxation, for the communities luxuries you can donate by calling 914-654-2087.
Thursday, February 2, 2012
Tax Education
By Tom Rhodes, 2/2/12
Libertarians consistently fail to educate and articulate the libertarian point of view in a way that can be understood. We also consistently fail to point out where in taxes the statists in power consistently hide simple truth from the people. We get drug down in dumb arguments and keep forgetting that the goal is liberty for all, equality for all, rule of law, etc. Today I'll make an attempt and mention some basics that the people should understand but politics and hyperbole get in the way: one is the stupidity of our double taxation system, the other is the Chutzpah of rich liberals calling for more taxes on the rich, and the last is similar in I point out the actual practices of a tax-and-spend liberal on using tax dollars for charity, compared to how he dictates the people act. I may be tilting at windmills, but in as much as liberty and freedom are clearly not the goals of either of the two major parties, we have to try.
Tax stupidity
Assume you own a business work a reasonable 50 hours a week, take care of your 5 employees, etc. and after all is said and done there was $100,000 profit in that business last year. You pay your 35% corporate income taxes and then you as owner are free to use the remaining $65K however you want. Now then, you see an opportunity to double the size of your business but need capital, so you sell some shares in your business but retain 60% ownership and full control. You use the investment dollars provided and expand and hire more people your work load is now about 60 hours a week and are successful and reach your projected doubling in size. Your expanded business now earns $200,000 dollars in profit and again pay 35% in corporate income taxes. You cannot keep the profit for just yourself anymore because you don't own all the business so based on who owns shares you distribute the now doubled $135K after tax profit to yourself and those whom purchased stock. Your share of the doubled profits is $78K, but . . . Since you are now a group of owners instead of a single owner these profits are now called dividends, and now taxed again at a rate of 15%. Thus you only actually receive $66K. The result is you doubled the size of your business increased your work load from 50 to 60 hours a week and took home an additional thousand bucks. Why increase your work load, risk, and hire more people for $1K per year? Obviously a napkin discussion with your accountant would lead any reasonable person to decide that expanding, hiring, etc. isn't worth it.
The above example the business owner add 20% more time and effort and takes home less than 2% increase in his earnings. If we did not double tax the profits from that same example, the 20% extra effort would have netted 20% extra earnings. All taxes on dividends are double taxing the profits of owners of a business. The profits a business earns are taxed, and then when the owner transfers their profit from the businesses bank account to their private bank account they are taxed again. That is double taxation, how is this fair?
The reality that statists and socialists fail to accept is that all corporate taxes are passed on to the purchaser of their product or service as part of the cost of that product or service. Just like the everyday Joe looks at his take-home pay, not his gross pay, investors and businessmen look at what's left-over after ALL costs including taxes are paid to determine whether an investment or business decision is worth the expense and effort. The reason so many younger workers opt out of benefits like health-care is that they can't spend benefits, and at the young low end of the work scale the risk of possible future health care costs compared to benefit of cash to pay for food, electricity, car payments, and the like are considered, and often the low risk of health problems associated with youth mean that the cost of health insurance are offset by the benefit of cash on hand. Those kind of risk/cost/benefit decisions are what determine future decisions for everybody. Currently we are in a no-mans-land of tax decisions, promises of more taxes on profits from business, uncertain health insurance costs, and future forced reduction in cash on hand for workers (forced insurance), when there isn't even a federal budget, has put business and workers in a holding pattern trying to protect cash and assets, growing them is secondary to protecting them. Thus we see huge interest in things like gold and silver. We need sound fiscal policy without ever-changing rules for people to make intelligent decisions about the future.
Tax Chutzpah
The hypocrisy of liberals like the Rev. Al Sharpton who attacks the Bush-era tax cuts and calls for "the rich" to pay more, belongs in the Hypocrisy Hall of Fame. Sharpton's income from his nonprofit is listed at almost $250,000. His salary at MSNBC is about the same, so "civil rights leader" Al Sharpton earns a cool half-million bucks a year to pontificate (cool gig if you can get it). The New York Post reports that he owes federal taxes and state taxes totaling $3.5 million. Wow!! Either he hasn't paid taxes for a long long long long time, or earns a lot more money than estimated or both. At his current $500K estimated earnings, if the government took all his earnings every year it would take him 14 years to pay off his IRS debt, he probably won't live that long. How much does a person have to earn to acquire a $3,500,000 tax bill? How much nerve does someone with earnings of about a half-million dollars per year, who effectively pays zero taxes have to have in order go on TV and rant for higher taxes on the rich?
Tax Charity
Statists are calling on taxing the rich more; they want the government to "take care of" everybody cradle to grave, but they don't actually practice what they preach. Consider Massachusetts, in 2001 it lowered its state income tax rate. Being the nice people they are they, put on their tax form a check box to allow the guilt ridded tax payer to volunteer and pay the old higher rate. Of the more than 3 million Massachusetts tax filers in 2004, a whopping 930 taxpayers volunteered to pay the higher rate. That number is so small it equates to just 3 pennies of $100.00; measurable but barely, and effectively zero percent. Now include in your consideration of this system that Massachusetts liberal Democrat Rep. Barney Frank, who like virtually every other liberal (or conservative, or libertarian, or independent) in his state declined the opportunity to pay the higher tax. Frank said, "I'll donate the money myself," explaining, "I don't trust the legislative leadership and Gov. (Mitt) Romney to make the right decisions." Even uber-liberal Barney Frank agrees with the libertarian viewpoint that private Charity will better spend his money than the government, which, by its nature, operates less efficiently and more expensively than can private welfare. He agrees that he, not the government should determine what charity should receive what part of his income to do charitable work. Why should any citizen trust the government to do what's best with their money if our most powerful elected leaders don't?
On a side note Barney Frank has uttered a good number of libertarian quotes, like this 2009 quote; "Criminalizing choices that adults make because we think they are unwise ones, when the choices involved have no negative effect on the rights of others, is not appropriate in a free society."
Libertarians consistently fail to educate and articulate the libertarian point of view in a way that can be understood. We also consistently fail to point out where in taxes the statists in power consistently hide simple truth from the people. We get drug down in dumb arguments and keep forgetting that the goal is liberty for all, equality for all, rule of law, etc. Today I'll make an attempt and mention some basics that the people should understand but politics and hyperbole get in the way: one is the stupidity of our double taxation system, the other is the Chutzpah of rich liberals calling for more taxes on the rich, and the last is similar in I point out the actual practices of a tax-and-spend liberal on using tax dollars for charity, compared to how he dictates the people act. I may be tilting at windmills, but in as much as liberty and freedom are clearly not the goals of either of the two major parties, we have to try.
Tax stupidity
Assume you own a business work a reasonable 50 hours a week, take care of your 5 employees, etc. and after all is said and done there was $100,000 profit in that business last year. You pay your 35% corporate income taxes and then you as owner are free to use the remaining $65K however you want. Now then, you see an opportunity to double the size of your business but need capital, so you sell some shares in your business but retain 60% ownership and full control. You use the investment dollars provided and expand and hire more people your work load is now about 60 hours a week and are successful and reach your projected doubling in size. Your expanded business now earns $200,000 dollars in profit and again pay 35% in corporate income taxes. You cannot keep the profit for just yourself anymore because you don't own all the business so based on who owns shares you distribute the now doubled $135K after tax profit to yourself and those whom purchased stock. Your share of the doubled profits is $78K, but . . . Since you are now a group of owners instead of a single owner these profits are now called dividends, and now taxed again at a rate of 15%. Thus you only actually receive $66K. The result is you doubled the size of your business increased your work load from 50 to 60 hours a week and took home an additional thousand bucks. Why increase your work load, risk, and hire more people for $1K per year? Obviously a napkin discussion with your accountant would lead any reasonable person to decide that expanding, hiring, etc. isn't worth it.
The above example the business owner add 20% more time and effort and takes home less than 2% increase in his earnings. If we did not double tax the profits from that same example, the 20% extra effort would have netted 20% extra earnings. All taxes on dividends are double taxing the profits of owners of a business. The profits a business earns are taxed, and then when the owner transfers their profit from the businesses bank account to their private bank account they are taxed again. That is double taxation, how is this fair?
The reality that statists and socialists fail to accept is that all corporate taxes are passed on to the purchaser of their product or service as part of the cost of that product or service. Just like the everyday Joe looks at his take-home pay, not his gross pay, investors and businessmen look at what's left-over after ALL costs including taxes are paid to determine whether an investment or business decision is worth the expense and effort. The reason so many younger workers opt out of benefits like health-care is that they can't spend benefits, and at the young low end of the work scale the risk of possible future health care costs compared to benefit of cash to pay for food, electricity, car payments, and the like are considered, and often the low risk of health problems associated with youth mean that the cost of health insurance are offset by the benefit of cash on hand. Those kind of risk/cost/benefit decisions are what determine future decisions for everybody. Currently we are in a no-mans-land of tax decisions, promises of more taxes on profits from business, uncertain health insurance costs, and future forced reduction in cash on hand for workers (forced insurance), when there isn't even a federal budget, has put business and workers in a holding pattern trying to protect cash and assets, growing them is secondary to protecting them. Thus we see huge interest in things like gold and silver. We need sound fiscal policy without ever-changing rules for people to make intelligent decisions about the future.
Tax Chutzpah
The hypocrisy of liberals like the Rev. Al Sharpton who attacks the Bush-era tax cuts and calls for "the rich" to pay more, belongs in the Hypocrisy Hall of Fame. Sharpton's income from his nonprofit is listed at almost $250,000. His salary at MSNBC is about the same, so "civil rights leader" Al Sharpton earns a cool half-million bucks a year to pontificate (cool gig if you can get it). The New York Post reports that he owes federal taxes and state taxes totaling $3.5 million. Wow!! Either he hasn't paid taxes for a long long long long time, or earns a lot more money than estimated or both. At his current $500K estimated earnings, if the government took all his earnings every year it would take him 14 years to pay off his IRS debt, he probably won't live that long. How much does a person have to earn to acquire a $3,500,000 tax bill? How much nerve does someone with earnings of about a half-million dollars per year, who effectively pays zero taxes have to have in order go on TV and rant for higher taxes on the rich?
Tax Charity
Statists are calling on taxing the rich more; they want the government to "take care of" everybody cradle to grave, but they don't actually practice what they preach. Consider Massachusetts, in 2001 it lowered its state income tax rate. Being the nice people they are they, put on their tax form a check box to allow the guilt ridded tax payer to volunteer and pay the old higher rate. Of the more than 3 million Massachusetts tax filers in 2004, a whopping 930 taxpayers volunteered to pay the higher rate. That number is so small it equates to just 3 pennies of $100.00; measurable but barely, and effectively zero percent. Now include in your consideration of this system that Massachusetts liberal Democrat Rep. Barney Frank, who like virtually every other liberal (or conservative, or libertarian, or independent) in his state declined the opportunity to pay the higher tax. Frank said, "I'll donate the money myself," explaining, "I don't trust the legislative leadership and Gov. (Mitt) Romney to make the right decisions." Even uber-liberal Barney Frank agrees with the libertarian viewpoint that private Charity will better spend his money than the government, which, by its nature, operates less efficiently and more expensively than can private welfare. He agrees that he, not the government should determine what charity should receive what part of his income to do charitable work. Why should any citizen trust the government to do what's best with their money if our most powerful elected leaders don't?
On a side note Barney Frank has uttered a good number of libertarian quotes, like this 2009 quote; "Criminalizing choices that adults make because we think they are unwise ones, when the choices involved have no negative effect on the rights of others, is not appropriate in a free society."
Thursday, December 23, 2010
2010 Census vs. Income Taxes
2010 Census results are out. America voted with her feet. Americans free to move from state to state, and immigrants free to choose where to live have made a decision. The Northeast is no longer growing, people are escaping it and it's liberal laws.
California once the fastest growing state in the union was stagnant over the last decade. For the first time in it's history it has not gained a house seat as the result of a census.
Texas grew grew 21 percent, its business-friendly regulations, diversified economy, and low taxes have attracted not only immigrants but substantial inflow from the other 49 states.
Here at home in Florida, we picked up two of New York's house seats. Where ever people can, they are moving away from high-tax pro-union states to low-tax pro-work states.
South Dakota and New Hampshire had the fastest growth in their regions although not as fast as the seven other states which do not have income taxes. The other seven of the nine states all grew faster than the national average. In total 35% of the nations total population expansion occurred in the 9 states without income taxes. These states in 2000 only had 19% of the nations population.
I think the power of the Northeast and industrial Midwest in winning the presidency is waning. The people of this country when given a choice, choose no income taxes. Next election will prove very interesting.
California once the fastest growing state in the union was stagnant over the last decade. For the first time in it's history it has not gained a house seat as the result of a census.
Texas grew grew 21 percent, its business-friendly regulations, diversified economy, and low taxes have attracted not only immigrants but substantial inflow from the other 49 states.
Here at home in Florida, we picked up two of New York's house seats. Where ever people can, they are moving away from high-tax pro-union states to low-tax pro-work states.
South Dakota and New Hampshire had the fastest growth in their regions although not as fast as the seven other states which do not have income taxes. The other seven of the nine states all grew faster than the national average. In total 35% of the nations total population expansion occurred in the 9 states without income taxes. These states in 2000 only had 19% of the nations population.
I think the power of the Northeast and industrial Midwest in winning the presidency is waning. The people of this country when given a choice, choose no income taxes. Next election will prove very interesting.
Thursday, April 15, 2010
Why?
Tax Day, a perfect day to review the well reasoned letter by Col Davy Crockett, explaining exactly why "entitlements" aren't the job of our government and why we pay way too much in taxes.
Enjoy
Not Yours To Give
by Col. Davy Crockett
One day in the House of Representatives, a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer. Several beautiful speeches had been made in its support. The Speaker was just about to put the question when Crockett arose:
"Mr. Speaker --- I have as much respect for the memory of the deceased, and as much sympathy for the suffering of the living, if suffering there be, as any man in this house, but we must not permit our respect for the dead or our sympathy for a part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has no power to appropriate this money as an act of charity. Every member upon this floor knows it. We have the right, as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I have never heard that the government was in arrears to him."
APPROPRIATE: To set apart for, or assign for a particular use, in exclusion of all other uses; as, a spot of ground is appropriated for a garden. [Webster?s 1828]
MONEY: 1) Coin; stamped metal; any piece of metal, usually gold, silver or copper, stamped by public authority, and used as the medium of commerce. 2) Bank notes or bills of credit issued by authority, and exchangeable for coin or redeemable, are also called money; as such notes in modern times represent coin, and are used as a substitute for it.If a man pays in hand for goods in bank notes which are current, he is said to pay in ready money. [Webster?s 1828]
CHARITY: Liberality to the poor, consisting in almsgiving or benefactions (Alms - Any thing given gratuitously to relive the poor, as money, food, or clothing, otherwise called charity), or gratuitous services to relieve them in distress. [Webster?s 1828]
"Every man in this House knows it is not a debt. We cannot, without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as a charity. Mr. Speaker, I have said we have the right to give as much money of our own as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week's pay to the object, and, if every member of Congress will do the same, it will amount to more than the bill asks."
AUTHORITY: Legal power or a right to command or act; as the authority of a prince over subjects, and of parents over children.? Power; rule; sway. [Webster?s 1828]
He took his seat. Nobody replied. The bill was put upon its passage, and, instead of passing unanimously, as was generally supposed, and as, no doubt it would but for that speech, it received but few votes and of course, was lost.
Later when asked by a friend why he had opposed the appropriation, Crockett gave this explanation:
"Several years ago I was one evening standing on the steps of the Capitol with some other members of Congress when our attention was attracted by a great light over in Georgetown. It was evidently a large fire. We jumped into a hack and drove over as fast we could. In spite of all that could be done, many houses were burned and many families made houseless, and besides, some of them had lost all but the clothes they had on. The weather was very cold, and when I saw so many women and children suffering, I felt that something ought to be done for them. The next morning a bill was introduced appropriating $20,000 for their relief. We put aside all other business and rushed it through as soon as it could be done.
The next summer, when it began to be time to think about the election, I concluded I would take a scout around among the boys of my district. I had no opposition there, but, as the election was some time off, I did not know what might turn up. When riding one day in part of my district in which I was more of a stranger than any other, I saw a man in a field plowing and coming toward the road. I gauged my gait so that I should meet as he came to the fence. As he came up, I spoke to the man. He replied politely, but as I thought, rather coldly.
I began, 'Well, friend, I am one of those unfortunate beings called candidates, and-'
'Yes, I know you; you are Colonel Crockett, I have seen you once before and voted for you the last time you were elected. I suppose you are out electioneering right now, but you had better not waste your time or mine. I shall not vote for you again.'
This was a sockdolager, I begged him to tell me what was the matter.
'Well, Colonel, it is hardly worth while to waste time or words upon it. I do not see how it can be mended, but you gave a vote last winter which shows that either you have not capacity to understand the Constitution, or that you are wanting in the honesty and firmness to be guided by it. In either case you are not the man to represent me. But I beg your pardon for expressing it in that way. I did not intend to avail myself of the privilege of the constituent to speak plainly to a candidate for the purpose of insulting or wounding you.
I intend by it only to say that your understanding of the Constitution is very different from mine; and I will say to you what, but for my rudeness, I should not have said that I believe you to be honest. But an understanding of the Constitution different from mine I cannot overlook because the Constitution, to be worth anything, must be held sacred and rigidly observed in all its provisions. The man who wields power and misinterprets it, is the more dangerous the more honest he is.'
'I admit the truth of all you say, but there must be some mistake about it, for I do not remember that I gave any vote last winter upon any constitutional questions.'
'No, Colonel, there is no mistake. Though I live here in the backwoods and seldom go from home, I take the papers from Washington and read very carefully all the proceedings in Congress. My papers say that last winter you voted for a bill to appropriate $20,000 to some sufferers by a fire in Georgetown. Is that true?'
'Well, my friend, I may as well own up. You have got me there. But certainly nobody will complain that a great and rich country like ours should give the insignificant amount of $20,000 to relive its suffering women and children, particularly with a full and overflowing Treasury, and I am sure, if you had been there, you would have done just as I did.'
'It is not the amount, Colonel, that I complain of, it is the principle. In the first place, the government ought to have in the Treasury no more than enough for its legitimate purposes. But that has nothing to do with the question. The power of collecting and disbursing money at pleasure is the most dangerous power that can be intrusted to man, particularly under our system of collecting revenue by a tariff, which reaches every man in the country, no matter how poor he may be and the poorer he is, the more he pays in proportion to his means.
What is worse, it presses upon him without his knowledge where the weight centers, for there is not a man in the United States who can ever guess how much he pays to the government. So you see, that while you are contributing to relieve one, you are drawing it from thousands who are even worse off than he. If you had the right to give anything, the amount was simply a matter of discretion with you, and you had as much right to give $20,000,000 as $20,000.
If you had the right to give to one, you have the right to give to all and as the Constitution neither defines charity nor stipulates the amount, you are at liberty to give to any and everything which you may believe, or profess to believe, is a charity, and to any amount you may think proper. You will very easily perceive what a wide door this would open for fraud and corruption and favoritism on the one hand, and for robbing the people on the other. No, Colonel, Congress has no right to give charity.
Individual members may give as much of their own money as they please, but they have no right to touch a dollar of the public money for that purpose. If twice as many houses had been burned in this country as in Georgetown, neither you nor any other member of Congress would have thought to appropriating a dollar for our relief. There are about two hundred and forty members of Congress. If they had shown their sympathy for the sufferers by contributing each one week's pay, it would have made over $13,000. There are plenty of men in and around Washington who could have given $20,000 without depriving themselves of even a luxury of life.
The Congressmen chose to keep their own money, which, if reports to be true, some of them spend not very credibly; and the people about Washington, no doubt, applauded you for relieving them from the necessity of giving by giving what was not yours to give. The people have delegated to Congress, by the Constitution, the power to do certain things. To do these, it is authorized to collect and pay moneys, and for nothing else. Everything beyond this is usurpation and a violation of the Constitution.
So you see, Colonel, you have violated the Constitution in what I consider a vital point. It is a precedent fraught with danger for the country, for when Congress once begins to stretch its power beyond the limits of the Constitution, there is no limit to it and no security for the people. I have no doubt you acted honestly, but that does not make it any better, except as far as you are personally concerned and you see that I cannot vote for you.'
'I tell you I felt streaked. I saw if I should have opposition, and this man should go talking, he would set others to talking and in that district I was a gone fawn-skin. I could not answer him and the fact is, I was so fully convinced that he was right, I did not want to. But I must satisfy him and I said to him:
Well, my friend, you hit the nail upon the head when you said I had not sense enough to understand the Constitution. I intended to be guided by it and thought I had studied it fully. I have head many speeches in Congress about the powers of Congress, but what you have said here at your plow has got more hard, sound sense in it than all the fine speeches I ever heard. If I had ever taken the view of it that you have, I would have put my head into the fire before I would have given that vote; and if you will forgive me and vote for me again, if I ever vote for another unconstitutional law, I wish I may be shot.'
He haughtingly replied: 'Yes, Colonel, you have sworn to that once before, but I will trust you again upon one condition. You say that you are convinced that your vote was wrong. Your acknowledgment of it will do more good than beating you for it. If, as you go around the district, you will tell people about this vote and that you are satisfied it was wrong, I will not only vote for you, but will do what I can to keep down opposition, and perhaps, I may exert some little influence in that way.'
'If I don't, I said, I wish I may be shot, and to convince you that I am in earnest in what I say, I will come back this way in a week or ten days, and if you will get up a gathering of the people, I will make a speech to them. Get up a barbeque and I will pay for it.'
No, Colonel, we are not rich people in this section, but we have plenty of provisions to contribute for a barbeque and some to spare for those who have none. The push of crops will be over in a few days and we can afford a day for a barbeque. This is Thursday. I will see to getting up on Saturday week. Come to my house on Friday and we will go together and I promise you a very respectable crowd to see and hear you.'
'Well, I will be there. But one thing more before I say good-bye. I must know your name.'
'My name is Bunce.'
'Not Horatio Bunce?'
'Yes.'
'Well, Mr. Bunce, I never saw you before though you say you have seen me, but I know you very well. I am glad I have met you and very proud that I may hope to have you for my friend.'
It was one of the luckiest hits of my life that I met him. He mingled but little with the public, but was widely known for his remarkable intelligence and incorruptible integrity and for a heart brimful and running over with kindness and benevolence, which showed themselves not only in words but in acts. He was the oracle of the whole country around him, and his fame had extended far beyond the circle of his immediate acquaintance. Though I had never met him before, I had heard much of him, and but for this meeting it is very likely I should have had opposition, and have been beaten. One thing is very certain, no man could now stand up in that district under such a vote.
At the appointed time I was at his house, having told our conversation to every crowd I had met, and to every man I stayed all night with, and I found that it gave the people an interest and a confidence in me stronger than I had ever seen manifested before. Though I was considerably fatigued when I reached his house, and under ordinary circumstances, should have gone early to bed, I kept up until midnight talking about the principles and affairs of government, and got more real, true knowledge of them than I had got all my life before.
I have known and seen much of him since, for I respect him - no, that is not the world - I reverence and love him more than any living man, and I go to see him two or three times every year; and I will tell you, sir, if every one who professes to be a Christian lived and acted and enjoyed as he does, the religion of Christ would take the world by storm.
But, to return to my story. The next morning I went to the barbeque and to my surprise, found about a thousand men there. I met a good many whom I had not known before, and they and my friend introduced me around until I had got pretty well acquainted - at least, they all knew me. In due time notice was given that I would speak to them. They gathered up around a stand that had been erected. I opened by speech by saying:
Fellow-citizens - I present myself before you today feeling like a new man. My eyes have lately been opened to truths which ignorance or prejudice, or both, had heretofore hidden from my view. I feel that I can today offer you the ability to render you more valuable service than I have ever been able to render before. I am here today more for the purpose of acknowledging my error than to see your votes. That I should make this acknowledgment is due to myself as well as to you. Whether you will vote for me is a matter for your consideration only.
I went on to tell them about the fire and my vote for the appropriation and then told them why I was satisfied it was wrong. I closed by saying:
And now, fellow citizens, it remains only for me to tell you that most of the speech you have listened to with so much interest was simply a repetition of the arguments by which your neighbor, Mr. Bunce, convinced me of my error. It is the best speech I ever made in my life, but he is entitled to the credit for it. And now I hope he is satisfied with his convert and that he will get up here and tell you so. He came upon the stand and said:
'Fellow citizens, it affords me great pleasure to comply with the request of Colonel Crockett. I have always considered him a thoroughly honest man, and I am satisfied that he will faithfully perform all that he has promised to you today.'
He went down, and there went up from that crowd such a shout for Davy Crockett as his name never called forth before. I am not much given to tears, but I was taken with a choking then and felt some big drops rolling down my cheeks. And I tell you now that the remembrance of those few words spoken by such a man, and the honest, hearty shout they produced, is worth more to me than all the reputation I have ever made, or ever shall make, as a member of Congress."
"Now, sir," concluded Crockett, "you know why I made that speech yesterday."
Enjoy
by Col. Davy Crockett
One day in the House of Representatives, a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer. Several beautiful speeches had been made in its support. The Speaker was just about to put the question when Crockett arose:
"Mr. Speaker --- I have as much respect for the memory of the deceased, and as much sympathy for the suffering of the living, if suffering there be, as any man in this house, but we must not permit our respect for the dead or our sympathy for a part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has no power to appropriate this money as an act of charity. Every member upon this floor knows it. We have the right, as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I have never heard that the government was in arrears to him."
APPROPRIATE: To set apart for, or assign for a particular use, in exclusion of all other uses; as, a spot of ground is appropriated for a garden. [Webster?s 1828]
MONEY: 1) Coin; stamped metal; any piece of metal, usually gold, silver or copper, stamped by public authority, and used as the medium of commerce. 2) Bank notes or bills of credit issued by authority, and exchangeable for coin or redeemable, are also called money; as such notes in modern times represent coin, and are used as a substitute for it.If a man pays in hand for goods in bank notes which are current, he is said to pay in ready money. [Webster?s 1828]
CHARITY: Liberality to the poor, consisting in almsgiving or benefactions (Alms - Any thing given gratuitously to relive the poor, as money, food, or clothing, otherwise called charity), or gratuitous services to relieve them in distress. [Webster?s 1828]
"Every man in this House knows it is not a debt. We cannot, without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as a charity. Mr. Speaker, I have said we have the right to give as much money of our own as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week's pay to the object, and, if every member of Congress will do the same, it will amount to more than the bill asks."
AUTHORITY: Legal power or a right to command or act; as the authority of a prince over subjects, and of parents over children.? Power; rule; sway. [Webster?s 1828]
He took his seat. Nobody replied. The bill was put upon its passage, and, instead of passing unanimously, as was generally supposed, and as, no doubt it would but for that speech, it received but few votes and of course, was lost.
Later when asked by a friend why he had opposed the appropriation, Crockett gave this explanation:
"Several years ago I was one evening standing on the steps of the Capitol with some other members of Congress when our attention was attracted by a great light over in Georgetown. It was evidently a large fire. We jumped into a hack and drove over as fast we could. In spite of all that could be done, many houses were burned and many families made houseless, and besides, some of them had lost all but the clothes they had on. The weather was very cold, and when I saw so many women and children suffering, I felt that something ought to be done for them. The next morning a bill was introduced appropriating $20,000 for their relief. We put aside all other business and rushed it through as soon as it could be done.
The next summer, when it began to be time to think about the election, I concluded I would take a scout around among the boys of my district. I had no opposition there, but, as the election was some time off, I did not know what might turn up. When riding one day in part of my district in which I was more of a stranger than any other, I saw a man in a field plowing and coming toward the road. I gauged my gait so that I should meet as he came to the fence. As he came up, I spoke to the man. He replied politely, but as I thought, rather coldly.
I began, 'Well, friend, I am one of those unfortunate beings called candidates, and-'
'Yes, I know you; you are Colonel Crockett, I have seen you once before and voted for you the last time you were elected. I suppose you are out electioneering right now, but you had better not waste your time or mine. I shall not vote for you again.'
This was a sockdolager, I begged him to tell me what was the matter.
'Well, Colonel, it is hardly worth while to waste time or words upon it. I do not see how it can be mended, but you gave a vote last winter which shows that either you have not capacity to understand the Constitution, or that you are wanting in the honesty and firmness to be guided by it. In either case you are not the man to represent me. But I beg your pardon for expressing it in that way. I did not intend to avail myself of the privilege of the constituent to speak plainly to a candidate for the purpose of insulting or wounding you.
I intend by it only to say that your understanding of the Constitution is very different from mine; and I will say to you what, but for my rudeness, I should not have said that I believe you to be honest. But an understanding of the Constitution different from mine I cannot overlook because the Constitution, to be worth anything, must be held sacred and rigidly observed in all its provisions. The man who wields power and misinterprets it, is the more dangerous the more honest he is.'
'I admit the truth of all you say, but there must be some mistake about it, for I do not remember that I gave any vote last winter upon any constitutional questions.'
'No, Colonel, there is no mistake. Though I live here in the backwoods and seldom go from home, I take the papers from Washington and read very carefully all the proceedings in Congress. My papers say that last winter you voted for a bill to appropriate $20,000 to some sufferers by a fire in Georgetown. Is that true?'
'Well, my friend, I may as well own up. You have got me there. But certainly nobody will complain that a great and rich country like ours should give the insignificant amount of $20,000 to relive its suffering women and children, particularly with a full and overflowing Treasury, and I am sure, if you had been there, you would have done just as I did.'
'It is not the amount, Colonel, that I complain of, it is the principle. In the first place, the government ought to have in the Treasury no more than enough for its legitimate purposes. But that has nothing to do with the question. The power of collecting and disbursing money at pleasure is the most dangerous power that can be intrusted to man, particularly under our system of collecting revenue by a tariff, which reaches every man in the country, no matter how poor he may be and the poorer he is, the more he pays in proportion to his means.
What is worse, it presses upon him without his knowledge where the weight centers, for there is not a man in the United States who can ever guess how much he pays to the government. So you see, that while you are contributing to relieve one, you are drawing it from thousands who are even worse off than he. If you had the right to give anything, the amount was simply a matter of discretion with you, and you had as much right to give $20,000,000 as $20,000.
If you had the right to give to one, you have the right to give to all and as the Constitution neither defines charity nor stipulates the amount, you are at liberty to give to any and everything which you may believe, or profess to believe, is a charity, and to any amount you may think proper. You will very easily perceive what a wide door this would open for fraud and corruption and favoritism on the one hand, and for robbing the people on the other. No, Colonel, Congress has no right to give charity.
Individual members may give as much of their own money as they please, but they have no right to touch a dollar of the public money for that purpose. If twice as many houses had been burned in this country as in Georgetown, neither you nor any other member of Congress would have thought to appropriating a dollar for our relief. There are about two hundred and forty members of Congress. If they had shown their sympathy for the sufferers by contributing each one week's pay, it would have made over $13,000. There are plenty of men in and around Washington who could have given $20,000 without depriving themselves of even a luxury of life.
The Congressmen chose to keep their own money, which, if reports to be true, some of them spend not very credibly; and the people about Washington, no doubt, applauded you for relieving them from the necessity of giving by giving what was not yours to give. The people have delegated to Congress, by the Constitution, the power to do certain things. To do these, it is authorized to collect and pay moneys, and for nothing else. Everything beyond this is usurpation and a violation of the Constitution.
So you see, Colonel, you have violated the Constitution in what I consider a vital point. It is a precedent fraught with danger for the country, for when Congress once begins to stretch its power beyond the limits of the Constitution, there is no limit to it and no security for the people. I have no doubt you acted honestly, but that does not make it any better, except as far as you are personally concerned and you see that I cannot vote for you.'
'I tell you I felt streaked. I saw if I should have opposition, and this man should go talking, he would set others to talking and in that district I was a gone fawn-skin. I could not answer him and the fact is, I was so fully convinced that he was right, I did not want to. But I must satisfy him and I said to him:
Well, my friend, you hit the nail upon the head when you said I had not sense enough to understand the Constitution. I intended to be guided by it and thought I had studied it fully. I have head many speeches in Congress about the powers of Congress, but what you have said here at your plow has got more hard, sound sense in it than all the fine speeches I ever heard. If I had ever taken the view of it that you have, I would have put my head into the fire before I would have given that vote; and if you will forgive me and vote for me again, if I ever vote for another unconstitutional law, I wish I may be shot.'
He haughtingly replied: 'Yes, Colonel, you have sworn to that once before, but I will trust you again upon one condition. You say that you are convinced that your vote was wrong. Your acknowledgment of it will do more good than beating you for it. If, as you go around the district, you will tell people about this vote and that you are satisfied it was wrong, I will not only vote for you, but will do what I can to keep down opposition, and perhaps, I may exert some little influence in that way.'
'If I don't, I said, I wish I may be shot, and to convince you that I am in earnest in what I say, I will come back this way in a week or ten days, and if you will get up a gathering of the people, I will make a speech to them. Get up a barbeque and I will pay for it.'
No, Colonel, we are not rich people in this section, but we have plenty of provisions to contribute for a barbeque and some to spare for those who have none. The push of crops will be over in a few days and we can afford a day for a barbeque. This is Thursday. I will see to getting up on Saturday week. Come to my house on Friday and we will go together and I promise you a very respectable crowd to see and hear you.'
'Well, I will be there. But one thing more before I say good-bye. I must know your name.'
'My name is Bunce.'
'Not Horatio Bunce?'
'Yes.'
'Well, Mr. Bunce, I never saw you before though you say you have seen me, but I know you very well. I am glad I have met you and very proud that I may hope to have you for my friend.'
It was one of the luckiest hits of my life that I met him. He mingled but little with the public, but was widely known for his remarkable intelligence and incorruptible integrity and for a heart brimful and running over with kindness and benevolence, which showed themselves not only in words but in acts. He was the oracle of the whole country around him, and his fame had extended far beyond the circle of his immediate acquaintance. Though I had never met him before, I had heard much of him, and but for this meeting it is very likely I should have had opposition, and have been beaten. One thing is very certain, no man could now stand up in that district under such a vote.
At the appointed time I was at his house, having told our conversation to every crowd I had met, and to every man I stayed all night with, and I found that it gave the people an interest and a confidence in me stronger than I had ever seen manifested before. Though I was considerably fatigued when I reached his house, and under ordinary circumstances, should have gone early to bed, I kept up until midnight talking about the principles and affairs of government, and got more real, true knowledge of them than I had got all my life before.
I have known and seen much of him since, for I respect him - no, that is not the world - I reverence and love him more than any living man, and I go to see him two or three times every year; and I will tell you, sir, if every one who professes to be a Christian lived and acted and enjoyed as he does, the religion of Christ would take the world by storm.
But, to return to my story. The next morning I went to the barbeque and to my surprise, found about a thousand men there. I met a good many whom I had not known before, and they and my friend introduced me around until I had got pretty well acquainted - at least, they all knew me. In due time notice was given that I would speak to them. They gathered up around a stand that had been erected. I opened by speech by saying:
Fellow-citizens - I present myself before you today feeling like a new man. My eyes have lately been opened to truths which ignorance or prejudice, or both, had heretofore hidden from my view. I feel that I can today offer you the ability to render you more valuable service than I have ever been able to render before. I am here today more for the purpose of acknowledging my error than to see your votes. That I should make this acknowledgment is due to myself as well as to you. Whether you will vote for me is a matter for your consideration only.
I went on to tell them about the fire and my vote for the appropriation and then told them why I was satisfied it was wrong. I closed by saying:
And now, fellow citizens, it remains only for me to tell you that most of the speech you have listened to with so much interest was simply a repetition of the arguments by which your neighbor, Mr. Bunce, convinced me of my error. It is the best speech I ever made in my life, but he is entitled to the credit for it. And now I hope he is satisfied with his convert and that he will get up here and tell you so. He came upon the stand and said:
'Fellow citizens, it affords me great pleasure to comply with the request of Colonel Crockett. I have always considered him a thoroughly honest man, and I am satisfied that he will faithfully perform all that he has promised to you today.'
He went down, and there went up from that crowd such a shout for Davy Crockett as his name never called forth before. I am not much given to tears, but I was taken with a choking then and felt some big drops rolling down my cheeks. And I tell you now that the remembrance of those few words spoken by such a man, and the honest, hearty shout they produced, is worth more to me than all the reputation I have ever made, or ever shall make, as a member of Congress."
"Now, sir," concluded Crockett, "you know why I made that speech yesterday."
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