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.

Tax 'em till they bleed

A new title for Big Brother has welled up from what seems to be his favorite pastime: Taxer in Chief. Yes, Mr. Obama has found another opportunity to place yet another levy on the banking industry: Obama calls for bank tax as next step in reform.

Mr. Obama may or may not be aware of a fact mentioned now several times on this and other blog sites: taxes to industries are paid for by the consumers of such industries. In order to save us, the tax payers, from future financial ruin due to risky investment activity, Big Brother has proposed a tax which, ultimately, will be paid by us, the tax payers. How sweet of him.

All of this activity moves us further from the true source of risky investment activity: government intervention. Had Congress not interfered with the government entities known as Freddie Mac and Fannie Mae, creating an environment where risky investment became less risky for the actual lenders in the name of creating opportunity for the underprivileged, we would be looking at a significantly lessened recession. In fact, we would likely not have been introduced to the concept of bail outs had Mr. Obama and his congressional cohorts refrained from their typical shenanigans. Naturally, his solution to the aftermath of such government intervention is further legislation and taxation. I suppose he believes we can never have too much of a good thing. I, for one, disagree.

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.

TANSTAAFL

Retail sales dropped “unexpectedly” in May. I have to ask: who doesn’t expect this economy to worsen? I would submit that anyone within reach of a microphone who is telling us that the economy is recovering does so without any conviction. At the risk of sounding like a broken record: nothing this administration, or this congress, has done will provide long-term recovery.

What I find amazing, at least in this article ("
Retail sales drop 1.2 percent in May"), is a statement like this: “The big drop raises new worries about the durability of the economic recovery.” There are no new worries, only the same old ones. There is no expectation of durability or recovery, at least not by anyone paying attention to the actions of Washington.

What do I mean by stating that this administration has done nothing to contribute to the long-term stability and/or growth of this economy? Prior to this president’s ascendancy, we heard the economy described as a depression, the worst since the 1930’s. Since he took office, he and his cohorts in Congress have written, passed and/or signed budget busting legislation related to healthcare, climate change and Wall Street “reform”. They propose to pay for all of these things through both borrowing and higher taxes. Borrowing creates future taxes and higher taxes stifle growth. What of these actions addresses the supposed depression upon which Mr. Obama ran his campaign?

Of course, they rarely use the words “higher” or “new” taxes, unless the words are accompanied by “on the wealthy”. While it may be a tired old mantra to many of us, it is the play on which much of their past success has been built. Make no mistake, however: a tax on anyone is a tax on everyone. Higher taxes on the oil companies translate into higher costs at the pump. Higher taxes on industry lead to higher costs of goods. Higher taxes on “the wealthy” lead to less investment by those people, leading to fewer jobs, leading to higher unemployment, leading to a higher tax burden on those who remain employed. Put simply, and by wiser people than I, there ain’t no such thing as a free lunch.

A return to D.C.

Yes, I did manage to make it up to D.C. for the tea party rallies held on the 15th. No, it wasn't as big as I had hoped. It was what I should by now expect: largely a group of conservatives flying the banner of smaller government and less taxes while insisting on the support of conservative versions of big government. There was even a speaker who advocated the populist position of forcing big company executives to fork over money to pay for social programs. At least that's what little I could glean from his meandering speech and failed rallying cry.

I suppose the one thing I did learn from this excursion is that I have been, and remain, an isolated voice in the sea of the disenfranchised. While my "Libertarian Thought Criminal" t-shirt drew several complements, the vast majority of the people were there to push for a return to the burdensome social agenda of the right. This is not likely something they'd admit to, but my anecdotal observations lead me to that sole conclusion.

I had a woman speak to me about how individual rights are granted by god, not by the government. I agreed with her that the government does not grant rights to the individual that aren't already possessed by that individual by virtue of their inclusion in this human race. However, informing her that I did not belong to the club known as Christians, I found our conversation strained and shortened from that point forward. It appears that even common ground doesn't provide enough purchase to maintain civil discourse, at least to some.

The most humorous event occurred when some counter-protesters arrived with signs thanking our president for providing 95% of tax payers with a tax cut. At first I thought this to be an example of the degree to which our government schools are failing us. However, it turns out that Mr. Obama himself had made this claim. I must admit that I marvel at our president's considerable cheek. His distortions, exaggerations and lies continue to outpace the lengthening of his nose. Even if he were referring to tax credits, which are in fact a delay in tax payment rather than a cut, he certainly hasn't provided this "benefit" to 95% of the people. He may have bought into the Orwellian idea that "he who controls the past controls the future," but he doesn't yet maintain absolute control over the information at the disposal of the people.