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Jobs, Wages, Taxes and Personal Freedom Economic collapse won’t happen overnight. It will develop over a period of time. The most important thing is to recognize events for what they are, as they unfold. You can look back in history to find examples. The Great depression began with events that occurred prior to the stock market crash of 1929. The markets during the period prior to the crash were similar to every recession that has taken place. The economy, such as it was at the time, was going full steam and “irrational exuberance“ was the order of the day in the stock market. Finally the bubble burst, and the economy went into an extended recession. (Depression) It lasted more than ten years. Under those conditions, wealth simply disappeared. It was far worse for some then others. Recovery was easier for those who were prepared. There’s a quiet, but growing revolution going on in America. Citizens in every corner of the U.S., especially the younger generation, are waking up to the reality around them. That is at least some consolation, after what our generation has and will continue to pass on to our children and grandchildren.They’re angry because they are being lied to by our government officials and the wizards of Wall Street. Even those who are not aware of the specifics can sense that there is something wrong. Wages in comparison to inflation have been fairly stagnant since 2001. Of course, government agencies will tell you that wages are in line with inflation. That’s because they insist that inflation has been kept at bay, when food and energy are excluded. I tend to think that inflation is actually ZERO. That is, if you exclude everything that went up in price! This ridiculous method of calculating inflation, reflected in the CPI, was concocted because back in the 1970’s and again in the 1980’s, both government and big business agreed to institute annually adjusted cost of living increases into salaries and benefits, as a way to keep up with the runaway inflation of those periods. The problems we are facing today actually began in 1913 with the creation of the Federal Reserve. In 1933 our currency was taken off the Gold Standard. Then to finish us off, 1965 ushered in the end of silver backed currency and coinage, which led to the 15% inflation and 21% interest rates in the 1980’s. But the prolific creation of fiat money since 2001 has finally catapulted us from the worlds most prosperous nation into the worlds largest debtor nation, to the tune of over 10 TRILLION dollars. The U.S. Constitution was carefully drafted to limit the power of the government. It gave explicit control over the value of our money to Congress in Article I, Section 8. To Wit: “Congress shall have power to coin money, regulate the value thereof“ (Para.). The clause was intended to protect us against the possibility of a tyrannical government. The acts mentioned above not only left the door open to a tyrannical government, but they also left the Congress without a way to actually control the value of our currency and the ability of the people to control government spending. Since 2001, the US Dollar Index has declined 38% which means the value of the dollar was reduced by that amount, meaningful high paying blue collar jobs have disappeared, real income levels have fallen 11%, overall taxes have skyrocketed and our personal freedom is threatened by an ever intrusive government. Also, inflation has led to $100 a barrel Crude Oil, which is a threat to our national security, as it contributes to the financial coffers of nations who are waging war against America and anything American. That leads us to where we are today. We are now facing an extended recession. In other words, a DEPRESSION. All the signs are there. Fairly recent runs on banks, bank closings, record national debt, record personal debt (and rising fast), a declining dollar, price increases that seem out of line, salaries not keeping up with price increases, large increases in the price of gas and oil, commodity prices (Precious Metals, Grains etc.) in uncharted territory, increasing unemployment, decreases in home equity, an unprecedented number of bankruptcies, foreclosure rates as high as the great depression (1929-1939), reports of deflation or stagflation and repeated reports of more liquidity or large amounts of liquidity being added to the economy. We are also currently in the midst of a stock market collapse which may well lead to collapsing pension plans and accompanying hyper-inflation. In today’s economy, that would mean TRILLIONS of dollars of wealth being destroyed. And worse than that, the toll in human misery within the family will be unbearable for many. Jobs Jobs are created as the result of business owners needing help because they have more work than they can handle themselves. That scenario can only occur when the goods that are manufactured by that business owner can compete in the open market. In order to keep prices competitive, the business owner must take into consideration among other things, wages, expenses including taxes and government regulation. When either of those become too burdensome, it is no longer appealing for the business owner to remain in business, at least here in the United States. Wages are controlled by market forces and will be discussed below, leaving taxes and government regulation. Although product regulation in and of itself is a huge burden, let’s leave that out of the equation for now, as it might apply to public safety issues for instance. For now, lets consider tax related issues. Taxation is more than just having to pay the tax. A business owner must hire accountants or pay to have the work done. That’s because the current tax code is so complicated that it is almost impossible to interpret it. We have all heard horror stories about how thick the tax code actually is. Anyone who has attempted to even fill out a 1040EZ finds that the accompanying instruction booklet comes in pretty handy. Added to the complexity of the tax code is the fact that the business owner is responsible for not only his own taxes, but keeping employee tax records, collecting taxes from employees and forwarding those taxes to the appropriate taxing authorities. Businesses of all sizes today, are responsible for paying some or all of the following taxes:
Wages Wages where an employee is concerned, as opposed to the business owner, have been shrinking relative to the cost of living since 2001. Because of that, an increasing number of people are forced to work longer hours or at two or more jobs, just to buy necessities for their family. The saddest part is that the more a person works, the more that person pays in taxes. In effect, being penalized for their productivity. But there is more to it than that. Because in many cases both parents are forced to work, children are not getting the love and nurturing that they need to grow into productive adults. Crimes by children and teens have increased drastically in the past 10 years, as a result of the economic model that we have been forced to live by. If parents could take home everything they earned, the need for working two jobs would be unnecessary. There would also be more jobs available if parents didn’t have to work two jobs. In other words, wages and families would flourish. Taxes I’ve touched on both taxation on business and the benefits of not paying employee withholding tax. There are other benefits too. Imagine being able to start your own business without having to worry about being taxed to death, before your business even gets off the ground! Not only that, but how about all of the companies that moved overseas? Without the threat of taxation, they might consider moving back. And last but not least, how about the time saved by not having to study tax code or fill out forms, or pay a tax expert to fill them out for you? Personal Freedom Freedom as most Americans know it is secured mostly by property rights and private ownership. To own your own home, your own car, or your own whatever. Not only owning a thing, but owning it uniquely, in a private, responsible way, without interference. The founders of our country understood this. They knew without a doubt that tyrannical governments could tax its citizens into submission, and thus limiting freedom. They were also keenly aware that excess taxation led to less productivity. In other words, when it’s not worth working, why work at all! Whatever form of taxation the government chooses, whether it’s tariffs or duties, imposts or excises, were to be used to pay the debts and provide for the common defense and general welfare of the United States, according to the U.S. Constitution. Using revenues for anything beyond those issues mandated by the Constitution can only be controlled by a free citizenry. There are two ways that people can remain free. One is by demanding money backed by Gold or Silver, which is a subject for another day. The other way is to have the ability to control government spending by controlling revenues. We already know that gold or silver backed money is reviled by the powers that be. (The Washington Elite; those who lost sight of where they came from and who would sell their very soul to maintain their positions of power, lording over the voters who put them their.) The bulk of our problems including the above mentioned, could be solved by passage of what is known as the FairTax plan. The Fair Tax is a consumption tax based on how much you spend. The tax would be applied to the sale of all new consumer goods and services at the final point of consumption. Because used items have already been taxed they would not be taxed again. Higher prices on goods and services would be offset by a larger paycheck because there would be no deductions. Businesses would be exempt from taxes on goods used for production or service. The Fair Tax would totally replace all federal income taxes, capital gains tax, estate tax, gift tax, alternative minimum tax, Social Security Tax (FICA), Medicare Tax, self-employment tax, and any corporate taxes. There would be no need for the IRS or the Federal Reserve either. Americans would never have to worry about filing tax returns again. The only tax we would pay would be at point of sale. Period. In other words, paying taxes would be voluntary and you would keep everything you earned. In effect, we could control government spending by not spending our own income. Remember the taxes you expected to pay on your 401K when you retire? Gone! Not taxed under the Fair Tax plan. And capital gains on the sale of your home? Also gone. But now, the powers that be have revealed their true colors by assaulting supporters of the FairTax plan, through innuendo and character assassination. Apparently, giving the power of the purse back to the citizens is anathema to politicians. Apparently, they will continue to do what they do best. Spend us into oblivion by buying the taxpayers off with a temporary stimulus package. America has been looking for change. The chance for change is in your power. Will you seize the opportunity or just keep complaining?
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