Perpetuating Fallacies

This article includes a telling example of how most of our elected officials see the money collected as taxes: Philadelphia threatens jail for tax deadbeats. In the article, the Mayor of Philadelphia states “We want our damn money, you owe it, we want it, and I plan to collect it.” Other examples of this mentality can be found when bureaucrats make statements like this (from here):

In the near term, Steny Hoyer, House majority leader, raised the possibility that Congress will only temporarily extend middle-class tax cuts set to expire at the end of the year. He pointedly suggested that making them permanent would be too costly.

Not only does Mr. Hoyer ignore the fact that the Bush tax cuts dramatically increased tax revenue, he also implies that there will be a cost to the government of allowing people to continue to retain the money they have earned. Statements such as these prove that our elected officials believe that government actually generates money independent of the taxes it forcefully acquires and that this money then belongs to them. Neither of these beliefs is true. However, as long as we continue to allow these people to either labor under or perpetuate these fallacies, we will be destined to suffer under their oppressive and destructive control.

The Unavoidable

“The years of debt and spending make this unavoidable,” said British Chancellor of the Exchequer George Osborne in defense of an increase to the Value Added Tax (“VAT”). So, rather than addressing the spending to alleviate the debt, the British government has decided to increase their reach into the pockets of the British people. This, of course, is the natural progression of oppressive government taxation: take and spend as much as possible until your level of spending forces you to take more. The value added tax, ironically, is the next revenue stream proposed by the current U.S. Congress.

In short, the current proposed U.S. VAT seeks to tax the final step in the process, consumption, on top of each other step (i.e. payroll, income, corporate, capital gains, sales, etc.). Even the title is misleading, since it implies that the tax is related to value, which it isn't. It is simply a creative way to suck more blood from the stone in order to keep the vote purchasing mechanism well greased.

As I am a small government Libertarian, I see the need to have some method for paying for government, albeit on a much smaller scale. What we must do is streamline the tax structure while eliminating the ability for bureaucrats to manipulate the system for vote generation. The answer to this is the Fair Tax, where all other methods of government funding are eliminated, replaced by a single consumption tax that is fixed (i.e. not vulnerable to increase to pay for government fiscal irresponsibility). By placing the burden of tax payment on all consumption, we eliminate loopholes currently exploited by illegal aliens, criminals and those wealthy enough to hide their taxable income in the most creative ways. In this way we also remove the power of taxation from the people who spend the money, forcing them to work within the constraints of available funds.

TANSTAAFL

Dark at the end of the tunnel

The U.S. economy continues to suffer under the yoke of oppressive government intervention and regulation. As a solution, Congress proposes more of the same: Democrats' tax bill moves toward vote in US Senate.

While I am glad not to be one of those seeking employment in this economy, I don't see how indefinitely extending benefits to the unemployed does anything more than remove incentive to gain employment. We can wring our hands all we want over the situation, but we will not improve it without changing the way we do things.

Of course, the solution to paying for this extension involves a new tax. This levy is meant to target those greedy fund managers who profit from managing investments. Clearly these gluttonous denizens of Wall Street can do with a 65% tax on their income earned trying to make investment and growth a reality. While I don't have a specific concern for these particular targets of the government tax machine, the fact is that this tax will join the ever growing pile of regulatory suffocation known as the U.S. Tax Code, never to be heard of again, at least not publicly. I have two words in response to this: Fair Tax.

I have a right...

Congressman Bob Etheridge, Democrat from North Carolina's 2nd district, refused to answer questions from some students on a sidewalk in D.C. ("Congressman Assaults Student on Washington Sidewalk "). Repeating the question "who are you?" and stating that he has "a right to know", the congressman grabbed and held onto one of the students while the other student continued to film him.

The congressman was correct: he does have the right to know who is asking him questions. He also has the right to refuse to answer, to ignore, or to even dismiss those asking questions. What he does not have a right to do, however, is assault someone simply because they asked a question. By striking out at the student's camera and then grabbing the student, he commits a crime for which any other citizen would be subjected to legal action, providing further evidence that our elected officials seem to believe that the law over which they preside does not actually pertain to them.

We Didn't Mean Us...

When Democrats regained control of the House of Representatives, they did so with the stated intention to “drain the swamp” of corruption. Naturally, Democrats somehow believed that corruption was an attribute of Republicans only. This may be a revelation to them, but power’s corruptive influence knows no political, racial or ideological boundaries.

One of the methods for addressing what they claimed to be a right wing propensity for corruption was to create the Office of Congressional Ethics, proving that even politicians periodically create necessary and sensible devices to address their own abuses.

Now a subset of Democrats, specifically within the Congressional Black Caucus, is attempting to weaken the ability for oversight by this independent group because members of their caucus have been targets of its investigations (Black lawmakers want to limit new ethics office). Presumably Democrats have discovered that being humans themselves, they are equally prone to abuses of power and they're none too comfortable with that idea. While the leadership of this party are not supporting the effort, the push is no less an example of the hypocrisy to which we are regularly subjected by our elected officials.

Another Case of Do As I Say

It's not as though I need to work hard to find examples of government abuse. Case in point, Congress's reluctance to admit that access granted by virtue of their position does not constitute the same sort of insider knowledge that is afforded board members or executives of the same companies about which that knowledge pertains:
Congress Refuses to Outlaw Insider Trading For Lawmakers.

While each of us would argue that we would not succumb to the elixir of influence and power, we are equally vulnerable to the dictates of human nature. This is why it is so important that the limitations prescribed by the Constitution are adhered to. Despite (or perhaps due to) their position, members of Congress should have no more access to sensitive information than should the average person. Yet they not only have such access, they also have the ability to make that access legal. Had this concerned an evil executive or a greedy industrialist, there would be no question about this fact.

Actually, the idea of insider trading should be revisited. Instead of prohibiting this activity, there should be public access to the actions of those intimately involved in the workings of a company. In this way, any benefit of insider trading would be eliminated and the activities of those in a position to know would do what they should: benefit all investors.

Double plus ungood

There has lately been added to the lexicon a phrase which defies justification: “too big to fail”. The claim is that there exist companies whose impact is so broad and thoroughly integrated into the fabric of our economy that failure of such a magnitude would be unsustainable. The argument is no less specious than those which defend government itself. Not that I am an anarchist by nature, but I do think that government is overrated and, were ours to collapse, people would find a way to survive without it.

As for these companies that supposedly must be saved I say: follow the money. Sure the politicians will tell us that the loss of jobs, the collapse of financial markets and the gap in services will be too great, but what they mean by these things are the loss of government jobs, the collapse of financial support for their next campaign and the gap of services they will be unable to parade before the electorate. Creating the illusion that certain companies are so critical that government intervention is necessary to keep them afloat is akin to claiming that the collapse of McDonald’s will bring starvation.

While many people would be suffering had GM gone into bankruptcy protection, those people would be the unionists forced to renegotiate contracts that would make GM more competitive rather than the taxpayers who have yet to gain a dime from being forced into an unneeded rescue. The bailout of companies like AIG speaks more to the origin of political fund raising than it does to the need to persist financial institutions which practice flawed policies. Compounding these actions is the fact that it is the self-same elected officials who, having passed ill-conceived legislation, created many of the risk pitfalls into which these companies fell.

Additionally, and perhaps most importantly, creating a culture in which companies believe that they will be saved from demise should they fail means creating one where the natural influence of risk is removed and decisions are made with less regard for their downside. The government already enjoys such a cushion from failure and now, thanks to the misguided actions of our politicians, so does big business.

The Baby With the Bath Water

Yesterday, Joe Lieberman, Independent Senator from Connecticut, proposed legislation that would remove a citizen's rights based on their affiliation with, or participation in, alleged terrorist acts. While this is clearly a political move driven by the past week's activities in Times Square, it is no less a shining example of the steady, if sometimes subtle, erosion of rights to which we should be accustomed.

The fact that I considered voting for the dark lord, Al Gore, solely based on his selection of Lieberman as a running mate aside, I must say that few proposals have been more glaring assaults on our civil liberties than was this. Lieberman proves that even "moderates" are susceptible to the lure of power and the elixir of public whim (note: quotes should surround all things associated with Washington, not just descriptions of Lieberman's supposed political positions). Fortunately for us, even those on the far left see this suggestion for what it is: both unconstitutional and dangerous to the basic idea of individual rights.

Following 9/11, I read of the Philippines passing legislation similarly worded to this. At the time, all I could think of was the malleability of words. What is constructive criticism today is terrorism tomorrow. No, we do not want terrorists freely carrying out their violent agenda in this country. Nor do we want politicians and bureaucrats exercising the degree to which terrorism can be defined. I would ask Mr. Lieberman to consider his proposed legislation a terrorist act against the constitution, but I'm afraid he proved his redundancy long ago and the message would be lost on him.

Behind the Plow

I recently listened to a Cato podcast detailing the insanity that is Cap and Trade. Some of you have heard of this, the latest attempt by the left to modify our habits in order to address the well-disputed issue of man-made global warming.

Whether you believe that global warming is man made or not, you must avail yourself of the lunacy contained in this bill. The legislation I speak of can be found here: H.R. 2454. As you'll find in the section 703 ("REDUCTION TARGETS FOR SPECIFIED SOURCES"), the following goals have been outlined by our elected officials:

(a) In General- The regulations issued under section 721 shall cap and reduce annually the greenhouse gas emissions of capped sources each calendar year beginning in 2012 such that--

(1) in 2012, the quantity of greenhouse gas emissions from capped sources does not exceed 97 percent of the quantity of greenhouse gas emissions from such sources in 2005;
(2) in 2020, the quantity of greenhouse gas emissions from capped sources does not exceed 83 percent of the quantity of greenhouse gas emissions from such sources in 2005;
(3) in 2030, the quantity of greenhouse gas emissions from capped sources does not exceed 58 percent of the quantity of greenhouse gas emissions from such sources in 2005; and
(4) in 2050, the quantity of greenhouse gas emissions from capped sources does not exceed 17 percent of the quantity of greenhouse gas emissions from such sources in 2005.

In case you're wondering, 17% of emissions in 2005 generally equates to emissions from our forebears living prior to the start of the previous century. The brain trust previously known as the House of Representatives decided upon, and passed (by seven votes), a bill that proposes to reduce the emissions of the average American to levels not seen since the 1800's. Even those who believe that climate change is caused by man are unlikely to expect this or any country to return to an agrarian society.

Perhaps I should give our elected sycophants a modicum of credit. It's entirely possible that they believe that innovation will bring about such vast improvements in fuel economy and reduced consumption that we can maintain a lifestyle resembling that of the current century without the matching carbon output. Of course, if this were their intention or belief, why is it that everything they've done to date, including this legislation, has carried business and innovation stifling taxation and burdensome regulation? I suppose it's because they chose to prove, once again, that they don't have a clue how to enact any meaningful legislation without further expanding their power base.

Tanstaafl

The Battle Rages On

We as a nation remain embroiled in two conflicts, one in Iraq and the other in Afghanistan. Despite having a commander in chief who professes to oppose war, neither conflict shows much sign of soon ending.

Each of these is different in many respects. Afghanistan, for example, was started as a direct response to Taliban protection and sponsorship of Al Qaeda, a group that had perpetrated attacks on American citizens in both this and other countries. While the initial operation was relatively swift, the engagement has been complex and extended. Afghanistan is once again earning the title "Graveyard of Empires".

Iraq, on the other hand, was started as an extension of the Afghan conflict. The initial rationale was that Saddam Hussein had pursued and developed weapons that posed a threat to the U.S. and its allies. However, as the buildup to war proceeded, the rhetoric changed. Not only were Americans to disarm both a direct threat and a potential arms dealer to sundry terrorist outfits, we were to both liberate and bring democracy to an oppressed people in the process. It is on these latter points that the argument broke down.

The United States has had a long, if sometimes reluctant history of being the world's police. We have involved ourselves in many humanitarian, political and military actions targeting injustice. However, in the case of Iraq, we took this several steps forward. The rationale was that bringing democracy to Iraq meant stability for that part of the world. While such an assertion might be correct, it was not the responsibility or right of the U.S. to attempt such a thing. The action, absent any legitimate threat of weapons stockpiles or development, was illegitimate at best despite its moral claim.

Yet we remain in each of these conflicts. I would assert that the reason for this is no different than the reason for starting them in the first place. After 9/11, America had an obvious enemy against which our leaders could rally the masses. The wars themselves then became extensions of that enemy, regardless how far removed from the initial attacks they are. In a way, they represent East Asia or, alternatively, Eurasia. These are part and parcel of the machinations of global power where a common enemy maintains centralized power. While Bush had the heat of fresh attack to spark the conflicts and was forced to deal with waning political support in the media, Obama has the luxury of maintaining each of these conflicts, with the support of the media, until they serve a political purpose. It's time we removed the potential for any president to again claim moral high ground simply because he or she has instigated or perpetuated aggression.

As Goes Health Care

I begin this blog on a sad day for freedom in this country. Having just returned from our nation's capital, a place where I found a modest assembly of people at least moderately versed in the U.S. Constitution rallying against the attempted takeover of health care by our elected representation, I've come home to hear of the "momentous" beginning of socialized medicine in the land where liberty is thought to be an unalienable right.

While few I meet will argue that our health care system is not flawed, few people of reasoning can abide the atrocity that is the legislation passed on this day. The unconstitutional nature of the act aside, there is little hope of success of such an act. Nothing government does is efficient because government itself has no incentive to be so. Nothing the government does costs as little as the government claims it will because... well, I just answered that point. In fact, we have ample empirical evidence that such systems do not work, that they serve only to lower the quality and/or availability of care, and that they in fact harm the people they are presumed to aid: the poor. So starts my argument for repeal.

Constitutionality
A point which seems hardly worthy of debate. Health care itself is certainly not a stated right, nor can the declaration of "life" be twisted to apply to this without significant gerrymandering. Additionally, and most importantly, the constitution is explicit in the powers it grants to the federal government. Any such powers not granted are explicitly set aside for the states and/or the people. I plead the 10th on that point.

Feasibility
The system as proposed removes incentives for people to maintain insurance by removing the impact of "preexisting conditions". Those who see a financial incentive to pay the fine over the premium will take the sensible approach. Insurance providers will then have to increase premiums to address the shortfall, making even more people realize a financial incentive. The inevitable outcome of that are death spirals for each insurance provider until the only option is a government one. While the current scheme lacks a government "option", such activity will make it appear to be necessary to bring about that which the proponents have always desired: a single payer system administered by the government.

Ample examples of failed socialized medicine experiments aside, the ploy here attempts to imply feasibility of such a social program by delaying its implementation until taxation has built up a sufficient nest egg from which to launch. However, inevitably the cost of maintaining that single payer system begins to squeeze both availability (read rationing) and innovation while perpetually increasing the burden on tax payers. Eventually, the money runs out.

Perpetuation
While the stated cause is to help the impoverished, these are the people who will be forced to remain poor by the very plan that is meant to assist. How is this? Simple: subsidies. The proposal seeks to force all people to participate. When a person is incapable of paying the cost themselves, a subsidy is to be provided to assist them. When a person qualifies for government subsidies, they are trapped in a position where improving their station threatens the availability of those subsidies. For example, if a subsidy amounts to $12,000 dollars (i.e. $1,000 per month), as soon as this person begins to earn enough to no longer qualify for the subsidy, they take a $12,000 hit on their income. If they have advanced their personal income $24,000 in a single year, they net only half of the benefit, thereby removing the incentive to advance.

These are but a few of the several reasons to have defeated this legislation. There are ample methods for reasonably addressing the aforementioned flaws in the current system, none of which involve increasing government involvement:

Address tort reform
We are all aware of the impact that defensive medicine has made on the industry. This, coupled with outrageous malpractice rates make inexpensive health care merely a dream.

Increase competition
Allowing insurance companies to compete across state lines would mean... well... competition. Competition breeds lower costs and greater efficiencies. I just came up with that one all on my own.

Increase personal responsibility
People becoming directly aware of what health care costs will have the incentive to shop for better deals, to reconsider unnecessary procedures and to demand better alternatives.

Permit individual coverage
Sure it exists, but it's only after taxes. Individuals have an incentive to get insurance through corporations. If the federal government extended pre-tax payment to individuals, insurance would be accessible to many more people.

These are but a few of the options which, despite their viability, were ignored by the powers-that-be while crafting the current abomination. Instead we moved several steps further from freedom.