Thanks to our new president, I have seen the error of capitalism. I will make do with what I have, and nothing more, and for this I will be richer in many, many ways. And those ways are already paying dividends to my bottom line.
Like most Americans watching the so-called Stimulus Bill weave its way through the pork-laden halls of Congress, I was horrified at the thought of what the Democrats in Congress and the White House were doing to the economy. In the name of "saving jobs" they were killing the very mechanism that created this country's prosperity. Nothing in their package is designed to help the capitalist system recover, and prosper. Instead, it's a thinly-disguised effort to solidify government's control over the very people on whose behalf it is supposed to work, but who will now become a wholly owned subsidiary of organized labor, left-wing interests, and the Democrat Party.
Everything I was taught about free-enterprise, and the risks and rewards of individual initiative, vanished in the single stroke of a pen when President Obama signed the "bi-partisan" (hey, three Liberal Republicans voted for it!) stimulus package. You know, the one that is supposed to stimulate the non-stimulated economy that wasn't actually stimulated by the most recent "Rescue/Bail-Out" package, that didn't actually rescue anything . . . thus prompting the need for a Stimulus Package.
But — and here's where the lights have suddenly come on to re-shape the thinking of my narrow capitalist mind — as I've stood back to survey the wreckage of this socialist takeover of the U.S. economy, I've come to realize that maybe things aren't so bad after all.
No, it isn't that I've come to realize that the Stimulus Package will indeed work as advertised. Even in the dark I can still use my nose to smell a bag of sh*t, so nothing has fundamentally changed in my evaluation. Rather, what has changed is the way I now view myself in relation to the government, the economy, and the public at large. It's this change in perception, brought about by one-too-many "Obama's gonna pay my mortgage" or "Obama's gonna fix my car" bursts of insight from my fellow citizens, that has made me re-think the flaws in my own archaic thinking.
Where before I thought about myself as part of something larger (the country, a fellow American, or just a person who actually practices the acts of private charity that he preaches), I've now come to recognize that none of this really matters any more. If all I am is a walking ATM machine for the government because I happened to spend a lot of time educating myself in an effort to be successful, and spent a lot of my own money taking risks to increase my income (at times successfully, at other times not), then I've come to recognize that I am the problem, not the solution.
If my being well off is a sign of disregard for those who didn't work as hard as I did, or sacrifice as much as I have, then by God I'm quite willing to see the error of my ways. I will no longer participate in a never ending drive to increase my wealth and possessions, but instead will learn to live entirely within my present means. I will, in short, make do with what I have, and nothing more, and for this I will be richer in many, many ways.
And I can think of several right off the bat.
First, by understanding that the government is there to take care of people I was foolishly supporting in the past through my own income, I will be able to save several hundred dollars a month. I have a fairly large commitment to certain charitable organizations like Christian Children's Fund, where I am among their top donors nationally. Those commitments will continue unchanged. But — and here's where the savings come in — there's no need for me to entertain any more "special requests."
By this I mean, instead of writing a one-time check to the Red Cross for flood relief, or dropping some extra change in the round-it-up basket at my supermarket checkout to aid a local food bank, or responding to an appeal to help some family I don't know whose possessions were lost in a fire, I now understand that Obama and the government are there to do it for me. So, while my core charitable commitments will remain because, well, because I want to keep doing this even though it makes no financial sense for me to do so, I will henceforth operate under the "Biden Rule", and give no more money to charity than the Vice President did last year as a percentage of his income. Instead, my "charitable contributions" will take the form of public service work, just like Joe. Where he tirelessly ran for office, I will tirelessly write about people who ran for office. Besides, who needs Phil Jackson when we have FEMA, or HHS, or state or local government which knows how to do these things best anyway?
As you can see, with this new perspective I've already chalked up a hundred dollar a month savings at a minimum, which goes directly to my bottom line. This is increased by another new rule I've imposed on my in-laws and other distant relations that have routinely tapped the BOPJ (Bank of Phil Jackson) to pay for a new water heater, missed a mortgage payment or five, car repairs, medical bills, or any one of an endless number of non-tax deductable requests I've acceded to in the past. Now, when a request for cash has been made (as has happened twice already in the last two weeks), I ask a simple question: "Whom did you vote for?" When the question comes back "Barack Obama" I point them to the nearest social welfare agency. When it comes back "some third party candidate," I point them to the nearest social welfare agency. And, when it comes back "I didn't vote," I point them to the nearest social welfare agency.
Notice the pattern? If these people to whom I am embarrassingly related think Obama or some Losertarian candidate is the best guy to solve this country's problems, then that's the guy they should be soliciting, not me. If they liked the guy who best represented my interests by picking a VP nominee who best represented my interests, but they couldn't quite bring themselves to actually vote for that ticket, then I will support their request in principle, but like them find myself unable to actually put my name on the requisite check or money order. Just averaging the last couple of years of similar requests, I'm looking at a $5-7,000 annual savings. Split the difference and call it $6,000, to which we'll add the $1,200 I mentioned before, and I'm already $7,200 in the black.
But it doesn't stop here. I drive a 6-year-old car. It works perfectly fine, but I was thinking about getting a new one this year. Instead, I just spent $1,800 fixing it up. Since a new car would have cost me about $600/month, that's a net savings of $5,400 a year. True, the local car dealership won't get my business, and that means one less car to keep the unions busy in Detroit, but this isn't my problem. It's Obama's. I just added $5,400 in savings to my previous total of $7,200, which brings me up to $12,600 annually.
But it still doesn't stop here. The kids are all grown up and the wife and I were thinking about downsizing our house. However, I've got a great interest rate on a 30-year mortgage, so maybe we'll just stay put a few more years. If I do, there's no need to fix up my existing house to make it more attractive, no commission I must pay to a real-estate agent on the sale of my existing house, no need to build a new home so no need to hire construction workers or secure building materials, no moving costs for my family, no need to do any of this stuff. Even conservatively speaking, I'm saving at least $15,000 here, which added to the $12,600 now brings me up to $27,600.
But wait, there's more! Because we're not downsizing our house, my wife can still work another couple of years instead of having to retire because we left the area. Her retirement income, at best, would be 60% of her schoolteacher salary. Let's just pick a round number for someone with 30+ years of experience teaching in the South, and say she'll save $30,000 in salary and medical insurance costs by remaining employed. Add that to the aforementioned $27,600 and we're at $57,600. Sure, this is offset by some new teacher who won't get a job to replace my wife, and a school system that will have to pay her twice as much as a new hire, but once again this is not my problem. It's Obama's.
But it gets even better. My business partners and I have invested in at least one new business activity every 18 months for the last 10 years. Some of these efforts have been very successful. Others have cost us a ton of money. In 2006 we invested well over 6 figures in a business that ultimately proved unsuccessful, and again put over $70,000 into a business in 2008 that went down the drain, so there are no guarantees of success. But today, the rules are changing, and rather than selfishly fight it, I will simply acknowledge this. While the government still won't replace my losses (that's my risk gone bad, not theirs), I now understand that anyone making over $250,000, or $200,000, or $180,000, or whatever number the Obama Administration finally settles on will be declared officially "rich." And rich people have an unfair share of the country's resources, so they need to be taxed aggressively.
If my partners and I do things to dramatically increase our current financial position — and by doing this spend our money on goods, services, and to employ other people to help us — even if we succeed, we fail. All we are doing is drawing a bigger target on our backs. So, rather than kick my portion into any such effort, I choose to decline (as have my partners). I'll keep the $10-20,000 or so that could have come out of my own pocket as the junior partner in this enterprise. Let's be conservative and say that only $10,000 would have been at risk, which brings my increased bottom line up to $67,600.
But it's not quite over yet. Finally, the one thing I can do today that I've never done before is actually incorporate as an LLC, instead of operating my business activities as a private consultant. Doing this, my accountant has informed me, could mean another $10,000 savings to my bottom line. I don't pretend to understand the arcane nuances of tax law, but I do know my accountant won't entertain a deduction on my personal forms unless I've got the cancelled check, receipt, or other back-up documentation to substantiate it. So, let's go with the suggestion and assume that forming an LLC in 2009 isn't a corrupt tax dodge but a legitimate tax strategy, and will have the corresponding salutary impact on my taxes that I noted before. This brings the total up to $77,600.
That's $77,600 directly to my bottom line, thanks to President Obama. By letting the government do things for strangers and my relatives that I foolishly assumed as my own obligation in the past, by not flaunting my money on a new car or new home or other consumer items that keep people employed, by not using my own money to grow the economy when the government will do it for me, I've just become Obama-rich! This is real money with real value, until the hyper-inflation comes from simply printing money because Obama's policies have killed the capitalist goose.
But hey, until that time comes, I'll do quite well just taking care of myself and my family. And when it does come, I'll be in a better position to weather that storm because, like most successful people who aren't born Kennedys and have their wealth handed to them, I had to use my wisdom and talents to get this far. I'll use that same wisdom and talent to assess the situation in later years, and take the necessary steps then to protect my income and other resources as I am doing today.
Obama and the Democrats can kill capitalism, and the economy with it. But even in a fiscal cesspool there will be some people closer to the top than others. I didn't get where I am in life by waiting for the government to give me something, and I won't maintain what I have by painting an economic target on my back. So I'll always be okay, relatively speaking, because I'm smart enough to increase my disposable income without increasing my actual income if that's what I need to do to succeed.
And that, my friends, is the calculation shared by small businesses and hard working people everywhere, who may not have the political power to stop this insanity in government, but have no intention of being the ones to pay for it.
“…tax cuts demonstrated themselves…as having a neglible stimulative effect…” False.
Government revenue:
2000 – 2.026 trillion (Clinton’s last budget year)
2001 – 1.991 trillion (911)
2002 – 1.853 trillion
2003 – 1.783 trillion
2004 – 1.880 trillion
2005 – 2.154 trillion
2006 – 2.407 trillion (Democrats win congress)
2007 – 2.568 trillion
2008 – 2.524 trillion
I don’t trust Republicans, but there is no credible evidence to trust Democrats either. Democrats have done even worse.
Republicans and Democrats are both Keynesians. Keynesian economics have brought us to the brink of bankruptcy. Kenynsian economics have failed to preduct every downturn, have failed to effective the economy positively, and have failed to deliver on any conclusion reached.
The only rational position is what I have outlined. The Austrian school has correctly predicted every economic result of the last few decades. I’d throw my hat in with them if I were you.
And by the way, thanks for staying true to form in not answering my most subtantial points, like who pays income tax.
Correlation does not necessarily equal causation. Sure revenue went up as economic activity heated up. But was it lower taxes that heated the economy, or was it a regulatory environment and low interest rates that created a bubble, the one that we know just burst?
Aside from that, government revenue went up consistently through the Clinton years, despite higher taxes.
At this point I will let Krugman argue for me:
http://www.nytimes.com/2009/01/26/opinion/26krugman.html
>Next, write off anyone who asserts that it’s always better to cut taxes than to increase government spending because taxpayers, not bureaucrats, are the best judges of how to spend their money.
>Here’s how to think about this argument: it implies that we should shut down the air traffic control system. After all, that system is paid for with fees on air tickets — and surely it would be better to let the flying public keep its money rather than hand it over to government bureaucrats. If that would mean lots of midair collisions, hey, stuff happens.
>The point is that nobody really believes that a dollar of tax cuts is always better than a dollar of public spending. Meanwhile, it’s clear that when it comes to economic stimulus, public spending provides much more bang for the buck than tax cuts — and therefore costs less per job created (see the previous fraudulent argument) — because a large fraction of any tax cut will simply be saved.
>This suggests that public spending rather than tax cuts should be the core of any stimulus plan. But rather than accept that implication, conservatives take refuge in a nonsensical argument against public spending in general.
As for who pays taxes, income tax isn’t the only thing at issue. I am a big fan of capital gains and estate taxes, and I don’t see a whole lot of working class people paying those.
Sir,
I offered concrete evidence that directly contravenes your unsupported assertion. You said the Bush tax cuts as having a negligible effect, and I showed you that something positive DID happen. Where is your proof to the contrary? Prove your case. Bring your figures. Not your feelings or your political opinion.
Now we can argue about interrelated factors and their relative effect, but the FACT is that the Bush economic plan had a positive effect on government revenues, AFTER the recession caused by Clinton economic plan.
After the Democrats took control in 2006, revenues declined, the market crashed, and people have lost their life savings. Bernie Madoff stole 50 billion, the government stole 3 trillion.
Krugman is a poor choice to argue for you. He hasn’t been right yet. And he’s wrong in every quote you supplied.
>”Write off…” On what basis? This isn’t an argument, it’s a vapid statement.
>”…air traffic control…” Red herring. No one is arguing for zero government. And, Krugman presents a false choice. It’s not air traffic control vs. no air traffic control, the choice is whether government has the authority to operate the air traffic control system, or if private enterprise should.
>”…nobody really believes…” Nobody? No one at all? And, always? Krugman sets up a straw man, “NOBODY really believes that a dollar of tax cuts is ALWAYS…” The rest of his statement is pure Keynesian, and has no basis in fact or experience. Demonstated failure.
>”…conservatives take refuge…” The argument against public spending is not nonsensical, but Krugman’s unsupported assertions certainly are. The real nonsense is his adherence to failed economic theories.
“As for who pays taxes…” Excuse me, but Obama’s entire discussion focuses on who is going to get an income tax break. Have you been asleep for the past year? And, no one is paying capital gains taxes anyway, because no one has any capital gains. Obama has seen to that. Estate taxes amount to less than 1% of government revenues. Another red herring.
Is that the best you can do?
MM: You continue to treat this exchange with DK as if it’s a serious conversation. Ratchet down your expectations, appreciate it for its comedic value, and devote the majority of your time to real discussions with serious people. It’s my Lenten resolution, but it has a universal appeal beyond Lent.
Either that, or get DK and Raymond to converse. Raymond will dissemble about things he said but never meant, while DK will never mean what he actually said.
Sorry, Phil. I still hold out hoe that real evidence will actually crack through the delusion.
But what is more frustrating that the delusion is the refusal to deal with the major points I made in favor of quibbling about some detail, or simply moving the goalposts when his point is refuted.
I guess it’s too much to expect a logical progression of thought.
Sorry MM, I’m not buying the talking point you are selling. You say you gave me concrete evidence, but all you gave me was a list of revenue figures that were successively higher. Among other things, revenue figures tend to rise with the natural expansion of the economy brought about by population growth. I’m no economist, but I know enough about the scientific method to know that we would have to look at a whole lot more data than that before we had anything like concrete evidence. Besides, if those lower taxes were so stimulative, then why did revenue also grow impressively under Clinton’s higher taxes, and why did Clinton handily beat Bush in job growth during his terms?
As you say, there are certainly, “interrelated factors and their relative effect,” especially interest rates, regulatory environments and new technologies, all of which factored hugely in the early 2000s recession (remember the dot com and millenium spending booms in the IT sector, not to mention “irrational exuberance?) along with this one.
Regarding who pays taxes, yeah, I got a check from President Bush, too. But the cuts themselves were regressive. The higher earners saw higher percentage reductions, forcing the overall tax burden downward. Here is one example breakdown of the figures:
http://www.urban.org/publications/901006.html
So to answer your earlier point, yes, “tax cuts for the rich,” is a talking point, but it is one that is firmly rooted in fact.
Something else you wrote stood out:
>>”…air traffic control…” Red herring. No one is arguing for zero government.
Here are your words from earlier in the thread, MM:
>1) Disband all government departments that are not mentioned in the Constitution.
I don’t recall seeing the FAA in the Constitution. Should there really be fifty state Aviation Administrations instead, each controlling its own airspace and setting its own regulations, and standards? Wouldn’t it be great for safety if most pilots were licensed in, say, North Dakota, because it had relatively lax requirements similar to its permissive banking laws? Or if all coast to coast flights were longer, with the airlines diverting around a few flyover states that charged onerous tolls to use their airspace?
If we don’t acknowledge that there exist today technologies and circumstances that the framers literally never imagined, and interpret the Constitution to meet them the best we can, then it becomes an anchor holding us back instead of the cornerstone of a growing and dynamic society.
End of civics lesson.
That data I gave you, compared to the zero data you gave to back up your assertion, was more than adequate to demonstrate you were wrong. So, you then move the goalposts and want to discuss ancillary phenomena. Fact: These revenue increases sufficiently demonstrate that tax cuts do not hurt the economy or government revenues. That was all I had to show, and that’s what I did show. The rest is a diversion.
Clinton had the Contract With America to bring about his mderately successful economy. But that died out in the last three years of his last term, leaving Bush with a recession. Then 911 happened.
It sure is wonderful how you completely ignore large sections of what I write and simply restate your unsubstantiated assertion. I dealt at length with “tax cuts for the rich,” but it’s like it never happened.
“I don’t see the FAA in the Constitution.” Wow, could it be you finally understood a point? You are correct, the FAA is not in the Constitution. Therefore, government has no authority to police the skies without a constitutional amendment giving it specific authority to do so.
Krugman was arguing a different point: Funding, not constitutionality. I pointed out that he was setting up a false choice within the framework he created. That is all I did. And of course, you move the goalpost and want to discuss constitutionality. How air traffic control would be addressed is a separate argument, but the lack of a presently viable alternative is irrelevant to the constitutional issue.
Technology, the evolution of society, the poverty rate, the need for health insurance, you name the topic; it is all irrelevant to constitutional authority. If government needs authority to undertake some sort of task, the Constitution must be amended.
End of story. End of civics lesson.
>Fact: These revenue increases sufficiently demonstrate that tax cuts do not hurt the economy or government revenues. That was all I had to show, and that’s what I did show.
Actually, MM, the way I recall it, you presented the revenue figures in rebuttal to my statement in so many words that the stimulative effects of tax cuts was negligible and inferior to spending as a stimulus. I never said nor implied that they had hurt the economy. So in fact, your burden of proof was much higher, and not met.
I am not moving goalposts. You are attempting to apply simplistic statements and facts to complex information, and I am not having it.
The Contract with America? Care to elaborate on how what little of its legislation that passed had an effect on the economy, and what specifically expired, causing the economy to drop? From my point of view, it was Clinton’s deal with Greenspan that interest rates would be dropped if the deficits that were brought under control (which was done in part with tax hikes), that fueled the economy during his terms. As previously mentioned, it was the dot com bubble bursting an overheated economy that caused the recession, not some petering out of elements of the Contract with America.
And as an aside, if Clinton left Bush a recession, then Bush has left Obama a depression. Trying to stick this one to Obama will not stand.
Yes, you dealt at length with who received the tax cuts. My rebuttal involved how much they got. The Bush tax cuts were regressive. The math for that is not up for debate.
Regarding the FAA, I was pointing out a simple contradiction in your own words that I stand by as valid.
And again, if the Constitution must be amended to authorize every time the federal government needs to do anything new, then it is an anchor chained around our necks, not a cornerstone.
Yes I did.
No you didn’t, and here’s why: [ ]
Yes I did.
No, you didn’t. Here’s why again: [ ]
Yes I did.
No. You didn’t. And I’m not saying why any more.
Outta here.
Wait a minute…just kidding. Happy Thursday.
Dr. K,
I can certainly see your point about how the conservatives got it wrong economically. After all, it was Keynesian aggregate demand stimulation via government spending that accelerated us out of the Great Depression 10 years before the rest of the world. And it was “progressive”, 80% taxation on “the rich” during the Great Society that eliminated poverty and left us with a government surplus. And it was, after all, the same Keynesian concepts that carried over into the Carter administration and gave us that period of unrestrained job growth combined with low interest rates.
Oh, wait a minute, I think I’ve gotten something wrong there…
At least that Obama has clamped down on the Federal Reserve, tightened up interest rates, and cut spending to reduce that nasty 480 billion dollar deficit Bush left him though.
Oh dear, I’ve done it again haven’t I?
MM:
Re: #57 “…the FAA is not in the Constitution. Therefore, government has no authority to police the skies without a constitutional amendment giving it specific authority to do so.”
In all fairness, this is probably one of the more reasonable uses of the Commerce Clause.
Sedonaman,
You are perhaps on to something there with the commerce clause, though it might be a stretch. As you might guess, I will admit that I was taking the hard line with Kilovolt to push the issue.
He finally wirtes at the end that he thinks the Constitution has no value unless it can be ignored. The idiocy of that is self-evident.
But what I think is a more solid constitutional position is the national defense angle, where the military needs to secure the skies in order to defend the nation.
As far as Kilovolt, what I will no longer do is play the game with rule that constantly change.
Sedonaman writes: “In all fairness, this is probably one of the more reasonable uses of the Commerce Clause.”
The reasonable nature of any law has nothing to do with it’s constitutionality, except in the mind of liberal judges. In fact, what is so unreasonable about asking that an amendment be passed whenever “reasonable” people, like abortion supporters, decide something should or should not be outlawed? It’s not a complicated procedure and it’s been done 27 times with the latest in 1992.