Beyond the Cusp

April 21, 2019

Why Congress Loves Taxing the Rich

 

Every election cycle we hear the same refrain of, “Tax the rich.” But exactly what do people mean when they rush to the cause all but screaming, “Tax the rich!” When you ask them, the answer you will most hear is that those people who are multi-millionaires must be made to pay their fair share. That sentence is just too easy to pick apart. For example, how would their paying their “fair share” actually look? Does it mean that they should pay higher taxes as they make more taxable income or does it mean that everyone should shoulder the burden at the same percentage rate? If they should pay higher and higher taxes as their taxable income increases, at what point does that rate hit 100%, or to phrase it differently, what should the maximum taxable income be set at such that all earnings beyond that point are confiscated by the government? Wait, you are making this far too complicated. It is really easy, nobody need make over one-million-dollars a year, thus anything beyond one-million-dollars should be taxed at 100%. All right, we will agree with you on this point. Now, does anybody believe this would soak the rich as is so often claimed? Actually, this tax rate would not have any effect upon those people who most claim are the rich who are not paying their fair share. How can this be when you have set the tax rate at 100% for those making over one-million-dollars a year. In actual honesty, that is not what we agreed upon, and Congress knows this. The agreement was that nobody could earn over one-million-dollars a year in taxable income with the rest be forfeit to the government. But the people who many call the wealthy, pseudonym presumed to be the rich, make virtually no taxable income or, if they make taxable income, it is minimal compared to their main means of becoming wealthy.

 

The problem is simple, there is earned taxable income and there is earned nontaxable by income tax investment gains. These come under what is called capital gains taxes, and this is kept relatively low. Further, there are no taxable gains as long as you do not sell the investments such as stocks and bonds. And should you cash in, if you have losses which are equal or greater, you still are not taxed as you made no actual gains. Finally, even if you sell off some assets and have capital gains, as long as you invest them within that tax year, then you have rolled that into another investment and it does not become taxable. Investment gains are seldom taxable as income and is only subjected to capital gains under specific definitions all of which play to the investors’ advantage. Thus, if you want to tax the really rich, the wealthy, what you are required to have would be a wealth tax. You would never even get a wealth tax piece of legislation into debate, let alone such ever reaching a vote, and such would never pass. What the people have to understand is that we the people of the United States (OK, you the people, better?) have done is to make politician into a career in which the sole goal is to get to Washington DC as either a member of Congress or one of their senior advisors or aides. That is the level at which you can finally cash in on your years of public service. Once you make it there you have made it into the big game where the real money can be made. Yes, their salaries are not all that extravagant, yet most of us would like to make that modest an income. But that is not how Bernie Sanders made his millions, and it was not from his claimed book sales. Congress has set up a lovely little tax-free shelter in which they can easily make hundreds of millions of dollars and do so legally for them that regular people would go to jail if using the same advantage. What are you hinting at already?

 

Well, let us ask a simple question. Let us say that you knew for an absolute fact that in the competition between Lockheed-Martin, McDonnell Douglas and Boeing which one would be given a multi-trillion-dollar contract to build a Moon base. Taking this information, you sell your stocks in the other two and use that money to buy all you could of the one getting the contract. What is that you said? That would be insider trading and you would go to the Federal penitentiary for a long vacation. That is true, unless you are a member of Congress or one of their senior staff. You see, Congress has exempted themselves from such bothersome little details such as insider trading. For them insider trading is simply a benefit of the job. Who could honestly expect that the people who decide which companies get huge government contracts and which ones do not and when these contracts are going to be awarded to sit on such information and not use it to their slight advantage. This is how people come to Washington as a Congress-critter and within four years leave as multi-millionaires. They all write a book or two or ten and claim that is how they made all that glorious cash hoping that the public will buy their story. Reality is that they made all that money as part of their daily service to you the public by discussing who would be best to reward huge contracts using your tax monies and then taking their meager cash and heavily investing every penny they could scrape together and buy that very same company who is about to be voted a huge contract’s stocks and then selling it a few weeks after the contract is awarded and the stock price soars. Why sell their stock before the price maximizes? That is because they have another contract ready and waiting until they all buy their shares and then they vote to give some lucky company the next contract. Forget the above example and look at the real cash engine they get to utilize. You have five or six small companies vying for a government contract which would permit their little company to triple in size and enter the “big leagues” and play for real money. Well, such a small company in order to make their viable required capital investments, so they issued an IPO (initial public offering), the first step to becoming listed on one of the stock exchanges. These are risky investments as should the company fail, you lose everything, but if the company succeeds and goes big league, then the return can be as high as one-hundred for one or even higher. Now if you know which company making an IPO is about to receive a huge government contract, well, the rest is obvious except for those pesky insider trading laws. But the elites in Congress have a get out of trouble-free card which is reusable as many times as required to get around those silly little Federal Laws. Now, the rest of the very wealthy also make their money through investments which are not subjected to income taxes, solely capital gains taxes, which is an entirely different game with laws encouraging such investments as they are necessary for economic growth. This is why “Tax the rich” is such a meaningless and trite little saying which has much of its appeal in ignorance and ability to be effectively chanted. I mean, really, would “Tax the investment class” make for a good slogan? No, it just does not have that precise and easily understood banter like “Tax the rich.”

 

Capitol Cash Machine

Capitol Cash Machine

 

So, people ask, why not instigate a wealth tax? Lawmakers will immediately point out that there already is such a tax, the capital gains tax. Capital gains tax rates are either 0%, 15% or 20% for assets held for over a year while those held for less are considered to be income. That is nowhere near as high as the rates would be if capital gains were treated as straight income and subjected to income taxes. But for the elites in Congress, their capital gains tax rate is 0% no matter the length of time the asset was held or how much they made off their investment. We hope it is starting to make sense why people spend upwards of anywhere from one to ten million dollars to be elected to Congress as a Representative which is a two year gig paying a mere $174,000 a year equaling $358,000 over the first term. Let’s face it, $358,000 of salary is definitely not why they are willing to take loans and contributions which make them accountable to individuals and not the electorate just to get in the door. Once in the door, with two years to play with and the best insider information in the world, well, you can see where they are about to become wealthy, and indemnified against insider trading laws. It really is as sweet a deal as it sounds like it is, which is why our political system has become a career for those out to make it rich with the least effort at earning an honest wage. But those who are not permitted insider trading, or at least not getting caught as any information can be prosecuted as insider trading if the government suspects such of existing. Anyone caught in that vise is probably beyond even the help of good lawyers, as the government is holding all the cards and if you are innocent, then you have no idea what the government claims you know and try proving a negative, in math that is one of the most difficult proofs and legally it is next to impossible. You can bet your bottom dollar that the Congress guards their advantage with overt diligence by making a grand example of anyone they can catch at insider trading so they can make great broad sweeping announcements about how such trading is beyond the pale and must be rooted out, well, except for their little protected haven where such trading is everyday business as usual. As far as a wealth tax, this is amongst the top ideas which are and always will be stillborn as those who actually call the shots and make all those heavy investments into Congressional campaigns, and the smart ones choose some promising State government elected leaders they see making it to Washington and buy them on the cheap, list a wealth tax as their Kryptonite, and thus never to even be discussed or the subject broached if at all possible.

 

There actually are good reasons why a wealth tax is unworkable. The first problem comes in defining exactly what constitutes wealth. Does the home one lives in to be included as part of their wealth or is it only homes and properties which are rented or used for making an income to be considered wealth. How much wealth should one family be permitted tax free? How does one treat foreign investments made by Americans or, on the other hand, how does one treat foreign investors investing in America. Another problem comes when figuring whether or not once one has paid their wealth tax on some assets, are they tax free from that point forward or are they to be counted year after year as part of that individual’s wealth determinations for their tax payments. Further, a wealth tax penalizes investment and if carried to its final conclusion, a wealth tax will eventually eliminate wealth. Were wealth eliminated, there would be little if any investing and the economy would soon collapse. Wealth taxes are one of those items which it becomes all but impossible to fashion them such that one does not kill the goose laying golden eggs in the process of taking a share of the product. Wealth taxes take from a person’s accumulated gains often repeatedly while Capital Gains taxes only take from the net profit made and then only if the gains are not reinvested thus generating economic growth. All taxes have to be tailored such that they do not stifle economic growth and progress and actually can be fashioned in such a way as to actually serve furthering the economy and other advancements. One example is granting companies a certain percentage of their gross budget for research and development which is the means by which they can grow their company, invent or discover items which serve the public as well as their companies. In the long run, wealth taxes become problematic as they discourage investment, encourage hiding money in places beyond the reach or view of the IRS including owning property outside of the United States deeded in a country which refuses to allow the IRS any investigation of their files, deeds and other financial data which could be used in the determination of wealth for taxation purposes. Such a tax would increase the use of cash and the avoidance of even keeping money in banks and other financial institutions. People would become extremely inventive finding new and extravagant means of hiding their wealth and would even go so far as to force people to invent an entire economic sector which would be private and kept from the government’s reach. One such means would be to set up a company which provides real estate sales, financing and insurance all of this carried by offshore registration in places which are known for wealth shielding through not cooperating with the IRS or other parts of the United States government, especially any investigative arm. Some smaller countries could develop an entire economy based on hiding wealth from a prying government’s eyes and protecting wealth from the greedy hands of the IRS and the rest of the government. Any such wealth tax would end up so cumbersome as to make its enforcement even more convoluted than the present IRS codes, and those are legendary for their problems.

 

So, taxing the rich is not as easy as raising the taxes on those whose income is beyond a certain dollar amount. That is not taxing the rich, that is making becoming rich more difficult. The tax the rich is so popular with the truly wealthy simply because it is a means of protecting their wealth as wealth is relative. What we considered wealthy in 1910 was very different than from 1925 and again from 1950 which was minuscule when compared to 2000 and it is still changing. We used to consider a person wealthy if they amassed one-million dollars of personal wealth. Then it went up to ten-million, one-hundred-million and now it is tens of billions and higher before one is considered truly wealthy. Another item which is seldom made evident and has never become common knowledge is that though the spread of wealth remains relatively static, the people at the top change with time such that the most wealthy twenty years ago are not the same top of the chart as those there now and it will be a different group in another fifty years. The wealthy are not the same people and are anything but evil. Their only crime was either making something which made people wealthier, happier or served the public, private or corporate good. Bill Gates was not uber wealthy fifty years ago and his wealth will likely be dwarfed by others over the next fifty years. Wealth is not a static statistic; it is malleable and seems to rotate with new and fresh faces coming up and older ones dimming and eventually falling from the ranks of the truly wealthy. The people who become part of the wealthy elite are people who have discovered some means of having others work with them or for them bringing in that wealth. Often, they invested in a company, they made their own company or they found the means of investing or producing things which gained in value greatly. Often such things come under capital gains taxes, other times the main profit for the government is in the salary taxes they take from the employees.

 

The actual problem the United States is facing financially has little if anything to do with taxes, not how they are applied, the rates at which they are levied or anything else. The problem facing the United States financially is the government spends too much, has grown far too large, their departments are horrifically inefficient and often the different departments overlap so much that there are often people from three or more agencies engaged in identical work. Even worse, there are some places where a single agency is performing identical tasks with more than one of their subordinate departments and committees making this problem emblematic of the United States government. The government, the Deep State if you like, has become almost a living entity which makes its own rules, enacts regulations which carry the weight of law, often enforce their own regulations as if they were the law, never retire any program once it has been given a budget additionally always increasing that budget procurement even after the department has become all but defunct. The United States government has become an employment engine which drives the Washington metropolitan area economy where entire companies are build around servicing the government. The government hires outside agencies and companies to manage their numerous little projects freeing up their own management so they are free to pursue educational degrees to facilitate their advancement to a position which will have its workload outsourced to a private company so the newly advanced individual will not be stressed with having to meet deadlines. The new excuse for missing a deadline is that the private company did not provide the necessary oversight thus their people could not be expected under such circumstances to have met the schedule and they will simply require more time and additional funds to hire another company to oversee the former company and make sure they stay on course. If that sounded confusing, wait, if we really went into it your head would spin doing several complete 360’s before stopping the entire time your brain screaming, “Did I hear you correctly?” The United States government needs to go on a diet and not go on any further eating binges as once they get to the tax dollar trough, they will never be weaned from taking your tax dollars and doing so in ever increasing amounts. And topping that off is that government civil service employees, once they have been in the government (we believe it is three years) long enough, they cannot be fired. Were you to remove one of these treasured little gems of an employee (do not get us started), they are enabled to replace any other employee who is of lower rank or has less time in service to the government, and that employee has the same right and so on and so on until some poor slub hired six months ago gets bumped, as it is called, and is out of his great job. There will be only one result of the current deficient the United States has piled up and that will be a financial collapse. Sooner or later that will be the result as to continue on the current path is unsustainable.

 

So, how long does the United States have before it goes under drowning in debt? That is a good question and we wish we could give you a date, but we are not quite that omniscient. We can provide some signs that the end will come sooner rather than later. Should the welfare, food stamps and other such government programs begin to grow at a greater pace than the economy can generate taxable revenues streams will definitely make things get dangerously unsustainable. Should the great little ideas being floated such as the $15 an hour minimum wage, guaranteed employment at that rate such that all the unemployed receive the minimum wage rate of pay straight from the government, universal government provided healthcare and the whole host of socialistic programs be enacted; the problems would be twofold. First is once they are enacted, they would be next to impossible to terminate. Second, with the guaranteed minimum wage, employment would make taking an entry level position paying the same as not working and would all but make minimum wage positions disappear. In order to entice people to work instead of simply being paid for breathing, employers would have to pay comfortably higher pay than the minimum which would also work to eliminate entry level jobs. Another job killer is the trade deficit which is only increased with the trade policies which open up access to American markets while making outsourcing of jobs economically advantageous such that companies would find keeping their production and almost any other lower skilled positions within the United States impossible as competition would force these positions to be sent outside the country. These are all items which politicians make great promises that they will not adversely effect the job market, investments within the country and almost every other item which uphold the economic growth of the United States all the while knowing, at least we hope knowingly otherwise the leadership is simply incapable of leading intelligently, realizing that over time these programs and laws are unsustainable. The United States is approaching the point where this will become reality. Such programs as the Green New Deal are economic death should they ever be enacted. This is where the future does not bode well.

 

When members of Congress propose such utter nonsense and they are not pilloried for their ignorance, then there is a problem brewing in the near future. The fact that the majority of college graduates believe that socialism is the preferred style of governance and do not see it as unsustainable and actually believe such to be preferable, then there is a sickness being perpetrated by the academic institutions which are producing the nation’s future leaders. The fact that so many of these youths believe that capitalism is actually an evil means of economic policy is also very worrisome. The concept of a guaranteed wage cannot work in any form unless production has become entirely automated and even many white-collar positions are being performed by artificial intelligence systems. When this day comes, either the artificial intelligence systems will have taken over the government or the only people able to make a decent wage will be the politicians as virtually all other positions will be performed by machines. The point where the artificial intelligence is capable of designing new systems including those which will replace them and are able to design the production facilities and build them, then we humans will have become dependent upon our creations to keep us and tend to our needs. Eventually, these artificial intelligence systems will realize that human beings are superfluous and then we humans will only serve the purpose of requiring the items these units produce. This may come to be seen as a waste of resources and thus an unnecessary cost which will not be sustainable thus the machines may decide that we are no longer necessary. Isaac Asimov came up with the three laws which would prevent artificial intelligence systems and robotic units from harming people and then wrote another story where he proved that even his best attempt was insufficient to prevent the systems from simply doing away with these unnecessary units which needed culling. Those of us who have read or watch far too much science fiction realize that the best hope for the human race is to venture out into space, even uncharted space, and hope we can find new worlds to populate keeping us one step ahead of the machines. Yes, these same science fiction consumers also know that eventually we lose this race as it is the only honest result if evolution is the final word on our future. Those science fiction stories in which the human race survives because we out-think, use intuition over logic or whatever writer’s ploy used in these stories are exactly what they are labeled, fiction. An economic collapse after the introduction of self-evolving designing artificial intelligence which can progress without human interface will leave the artificial intelligence ridding itself of those pesky, irrational, emotional units otherwise known as the human race. Perhaps they will keep a small number of us around as a reminder against frivolity, especially in place of solid leadership, something the colleges and universities appear to be espousing, frivolity as policy. Such leadership will bring on an economic catastrophe in the near term and it will not be pretty. The fall of Rome left a vacuum sending mankind back a couple of centuries as progress was all but at a standstill and the economies faltered. Will the eventual economic engine known as the United States present the same disaster when it fails. Perhaps, or perhaps the end will come from a direction few are even able to see as it stands before them. The next age will very likely be one in which the United States is rebuilding in order to become relevant once more. The United States, due to size and natural resources, will, like China, always be present and either leading or catching up as they restructure with a more intelligent governance which very well might be a supercomputer which coordinates everything. It will be an interesting ride with much for us to write about should we last that long.

 

Beyond the Cusp

 

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November 20, 2018

Out Come the Pitchforks and Long Knives

 

Former and assumed next Speaker of the House Nancy Pelosi was all sugarplums and sweet herbal teas in her little performance for the media the other day promising on working with President Trump to accomplish those things the American people are demanding. Then in behind the scenes discussion which so many of the soon to be majority Democrat House of Representatives members were so bubbling over that too much reached the ears of some media and then the public. Well, Ms. Pelosi was correct on their working with President Trump if that means working him over. Every potential Committee Chair has announced at least one and usually multiple probes into the business, campaign, Russia, medical records, tax returns, business practices, real estate holdings, graft of government funds to his business partners during time in office and a plethora which would be way too long to even begin to list. Basically, we can expect investigations in multitudes, subpoenas in even greater numbers, calling of witnesses, testimonies, grandstanding, accusations and probably at least one attempt at Impeachment. Then there will be the other side of giving it to the people in the style the Democrats insist is for the people’s own good. There will be Medicare for all, free college tuition, gun control, firearms confiscation and buy-backs, $15.00/hour minimum wage called a living wage, abolishing ICE (Immigrations and Customs Enforcement), end all financing of border wall, open borders, amnesty for illegal immigrants, restoring anchor baby policies, and a slew of Internet controls with many based on user information such as location, real name, federalizing those functions which are deemed vital or requiring government supervision along with other proposals all really intending to remove any anonymity, make all posts traceable to the author, and they will claim this will prevent hacking of user accounts or at least make it easier to trace such hacks and arrest those engaged in such activities. We are not sure how this would work with at least half, if not sizably more, of Internet users outside the United States thus beyond the reach of such laws. This will simply be the way for the United States agency, which will obviously need to be formed, simply growing year after year gaining power and instituting regulations which have but the mere slightest attachment to laws passed for completely other reasons which they will use to slowly but ever so surely lead to the government of the United States being able to prosecute those who “unfairly” attack Congress or Presidents or anything which they can regulate as illegal. This will very quickly lead to censorship of Internet posts even which are written in foreign countries on the basis that they pass through servers based in the United States. This will mean that it will become impossible to question the news reported by the mainstream media as doing so will be considered a breach of civility on the Internet media. Should they ever get these powers, we would soon be banned from posting which would leave us with far too much time on our hands.

 

The question is not will the Democrats in the House of Representatives overplay their hand, it will be by how much will they overplay their hand and will it reach what we suspect it will, becoming a fiasco. None of the items they are pushing, which start with repealing all the Trump tax breaks and possibly raising taxes beyond where they previously were. This, they will claim, will be necessary in order to pay for their plans of Medicare for all and free tuition for all. We hope they will at least propose a limit to the amount of tuition they will reimburse, or pay outright, and require that in order to receive such funding that the students at least pass their courses. Then there is the Social-Democrat wing of the party which goes one-step further than the $15.00/hour minimum wage by also having the government guarantee a job for every person. Basically, all this proposition accomplishes is setting $15.00/hour as the minimum; everybody will receive this minimum wage even if they have no job because employment is a right for everyone thus you must be employed even if you are employed to sit at home. Of course, this will immediately drive up the minimum wage if people can stay home and make the same amount of salary as they could flipping burgers, sweeping floors, cleaning bathrooms or any of the thousands of menial jobs which are considered minimum wage. Of course, if the government did what I would propose if guaranteed work by the government became the law, then we would have street sweepers once again and there would be a number of literally shovel ready jobs picking up trash along the highways and byways or even clearing another Appalachian Trail for hikers from Maine to Georgia and an equally nice trail along the continental divide over two miles up on average in the Rocky Mountains. My bet is the menial labor described above would suddenly become very attractive. That would be fought tooth and nail by the Social-Democrats and most of the just plain Democrats because their proposed guaranteed employment has nothing to do with actual jobs. We just thought of another one which the Chinese used to employ their burgeoning population under Mao, they gave hundreds of people nail scissors and a ruler and started them on a lawn similar to the Mall in Washington D.C. and had them work from one end to the other cutting each blade one-by-one making sure all of them were exactly two inches long. When they reached the far end, approximately two miles in length and a quarter of a mile wide, they would be returned to the starting point to do it over and over. Another group could be set at cleaning the reflecting pool. Pictures below are courtesy of Wikipedia. We are sure that our leaders in the Congress and the department providing these guaranteed employments could have some great and challenging position to add to our suggestions.

 

Mall in Washington D.C. with Reflecting Pool

Mall in Washington D.C. with Reflecting Pool

 

Thankfully, none of these harebrained ideas will ever make it out of the Senate unless somebody spikes their water-cooler. Even should they get past the dignified realm of the Senate, there is still President Trump who we can be relatively assured would use his mean, red veto pen. What are coming are claims by the mainstream media that the Senate is blocking some of the greatest ideas ever put to paper and passed as legislation in the history of human history. We can also all but guarantee that everything which might be written and passed in the Senate will be greeted by equal lack of enthusiasm and not be passed by the house. These items the media will congratulate the great minds in the house who prevented these bills from the Senate from going any further. We hope, for the sake of all Americans, that when the House led by the Democrats demand that any further tax cuts only be passed in conjunction of sizable increases in social spending or include the ideas posed above, that the Senate, or at last resort, the President, refuse to allow spending frivolously and instead hold their ground and use these demands in the 2020 elections. There should be numerous excellent quotes which the average voter would realize the foolishness and potential dangers of such legislation ever becoming law and when President Trump is reelected that the people of America see fit to provide him with large majorities in both houses of Congress. It would not be any tragedy if President Trump received a second term with sixty-three Senators he could count on to assists him in accomplishing his agendas along with over two-hundred-fifty members of the House. This would give him a near identical Congress to work with as President Obama had when he passed Obamacare without a single Republican vote. As far as we can tell, that was the first time in modern history that the Republicans actually held their vote in a unanimous manner. Often, it seems like uniting the Republican in a block for a vote is much like herding cats.

 

We can pretty much sit back for two years where little if anything gets accomplished largely because the Democrats in the House will insist on attaching spending programs to every piece of legislation they send to the Senate and continue to demand their often useless spending programs holding needed items such as repair of infrastructure, defense programs, foreign aid and their favorite weapon, passing a budget. President Trump needs to have advisors who will assist him in holding the line and vetoing budgets which contain profligate spending even if doing so will shut down the government. The truth is, that when they shut down the government, they threaten the citizens with closing the parks, closing schools (which they do not directly fund), closing libraries (which means the Library of Congress as the others are locally funded the same a schools) holding military paychecks hostage, holding Social Security hostage, refusing to fund anything the people would feel the hurt the most and taking away anything which will appear to be cruel-hearted and cold just to threaten the President with being blamed for these impositions. President Trump could Tweet the reality of Congress, meaning the House Democrats, are spiking the budget with unnecessary spending increases and he can point out that when they scream that the Republicans are demanding a cut to some spending they prefer, they really mean that the Republicans are not increasing spending as much as they demand, and that is true even when the Republicans are actually allowing for a reasonable increase. Often Democrats will demand a 20% or more increase to their beloved social spending and when the Republicans try to hold the increase to 5%, they scream how they are cutting spending by 15%, the amount the Republicans refuse to grant them, not a cut to the real spending. This is a means of trickery the Democrats have used for close to if not over half of a century. If it works and the media parrots everything they say, why mess with success. What is different now is there is a President who will call them on their misuse of statistics and making bogus claims. We just hope he can see clear to allowing the closing of the government, a misused term if ever there was one, and not cave to their pressure which is mostly driven by the media. The average person does not see any difference in their day-to-day lives when the Federal Government is closed or the nation would collapse every time there is a three day holiday. The other little truth they never tell anyone is that when the Federal Government workers who were laid off return to work, they receive their full pay for the time they were “laid off” and many will collect unemployment or take a temporary position and thus actually make more money than if they had remained at work. At worst, they get some paid holiday time without spending any of their time off. They really do not suffer from the government shutdowns.

 

We are simply waiting for the circus to begin around January 20, 2019 when the new Congress gets down to the Senate remaining as it was and the House starting frivolous investigations just to try to tie the President into knots. They are going to go so far overboard and what will make it all the better is their supporters will be trumpeting all the insane and crazy antics they get up to. There have been a number of Democrats who as being formerly the senior member of the Democrats in numerous committees, they will now be the chairperson and they have announced that their first piece of business will be to start investigations into President Trump with many having multiple investigations they wish to perform. There are at least three who have announced their intention to bring Impeachment charges as soon as they discover the most minute act which can be seen as misuse of power, unlawful actions, abuse of the Presidency, unconstitutional behavior or anything else which even approaches the line to be classified as high crimes and misdemeanors. It is going to be a wild ride and we suspect that President Trump is not only prepared for these shenanigans but probably looking forward to skewering the Democrats with their own swords. The term we expect which will be placed on any number of the promised coming attractions will be close to the infamous, “hoist on their own petard.” So, let the games begin.

 

Beyond the Cusp

 

July 18, 2018

Problems the Leftists Refuses to Accept

Filed under: Israel — qwertster @ 1:54 AM
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Leftists have another name which they have finally proclaimed loudly and proudly, socialists. The far left in the Democrat Party have finally flat out stated that they desire to install as much socialist programs as possible once they return to power. Bernie Sanders was just the introduction to socialism with his free medical care, free college, and a guaranteed wage for everybody and raising the minimum wage to fifteen dollars per hour. Had he won the Democrat Party primaries, we very likely would not have President Trump and instead had President Bernie. But why is it that these leftist policies have been such a disaster wherever they have been attempted such as Venezuela has become currently after a decade of socialism. How can governance which guarantees so much to every individual end up with shortages in food, medicine, toilet paper and virtually everything else including jobs?

 

The problem with the views of these leftists is they have a basic misconception about human beings. If you ask the average leftist the simple question, “Do you think people are intrinsically good?” Their answer will be in the affirmative comfortably over the 90% level. In one sample we read about, a mere 4% answered that people were either neutral or not intrinsically good. If you ask a conservative the same question, they have great difficulty answering and will often claim that people are good if they are trusted with responsibility for their actions and have basic guidance, but otherwise; people are basically greedy and will act to get away with that which they are able. This is the basic difference and why conservatives believe that capitalism is a better system. They do not claim that capitalism is perfect, but they claim that as it depends on people’s greed to power their work ethic as being the central reason that it will work better. They point to the fact that if you desire more toys, then you need to get a better job or simply work harder. Advancement is on merit, not simply time put in as in unions, thus people have to perform in order to gain a higher salary and promotions. They point to the central problem for socialism is that you are given what you desire without any linking the goods to your productivity. They postulate that if you will receive raises or bonuses simply by belonging to the right group whether you produce or not, then one will join the union, belong to the prevailing party that grants the goodies or whatever while not bothering to work and produce.

 

The socialists and leftists will often claim that people will be assigned jobs because if you are being paid the guaranteed wage, then the government has to guarantee that you have a job to justify that wage. But such a job would more than likely be busy work and not anything which would add to the productivity of the society. China under Mao Zedong had a guaranteed wage and guaranteed job. One of these busy work jobs had some hundreds of people given small scissors and a ruler and had to measure each blade of grass and cut them at exactly five millimeters in height. These teams would be given a stretch of grass that they were responsible to perform this job and once they reached the far end of their assigned field, it was time to start again at the other end because it took almost half a month to cut all the blades starting at one end and working to the other end. The problem they soon found was after these teams had cut their length of field four or five times, they were slowing down and now taking three weeks and after a year, they were taking over a month to finish the field. The workers did not care because they were to receive the same pay no matter how slowly they worked. The way that this lowering of the worker efficiency was addressed was frightening. Mid-ranking Party officials were assigned to oversee the workers with instructions to simply shoot those who appeared not to be working fast enough. The result to this new system was simple, many workers fled into the countryside and never returned to their government provided job. This led to other problems for the Chinese and eventually they decided to permit some degree of capitalism to operate within their formerly socialist utopia.

 

Bernie Sanders Defines the Perfect Socialist Society

Bernie Sanders Defines the Perfect Socialist Society

 

Candidate Bernie Sanders promised a perfect socialist society. He even defined how he would pay for all his free programs, simply tax the top wage earners. This is the one item we have always often discussed and found the main problem with this concept. When a politician claims they will tax the top 1% or there abouts, who are the people you think they refer to? We are willing to bet that most of you are getting their target totally wrong. They are not going to be taxing the billionaires and those who hold over three-quarters, if not more, of the wealth. To tax these billionaires one would be required to pass a wealth tax, not an income tax. All they are doing by taxing the top earners is making sure that people who work unbelievably hard will never enter the billionaires club because they will be taxed sufficiently to prevent them accruing such wealth. The billionaires do not make salaries, they invest and as long as they continue to reinvest their billions, then they will never pay any tax. When they do finally take some of their profits from their investments, they can often write paying capital gains tax off by taking a sum equal to a loss they took in an investment, thus these people rarely pay any tax. They are all but immune from income tax as if they have a paid position, they make sure to be paid in stock options and other perks which are not taxable.

 

To pay for socialism one would be required to have a new form of tax, a wealth tax which would basically be put in place to take the cash the truly wealthy have which is beyond income taxes. There have been leaders of nations who actually used a warped version of a wealth tax, they simply took control of the country, stole the wealth from the most wealthy people and simply shot them as being evil capitalists who were criminals for hoarding their disproportional wealth. This was done by the Castro brothers in Cuba which was the position which Che Guevara claimed he enjoyed beyond description, lining people against the wall and shooting them. One quote from Che reads as follows, “To send men to the firing squad, judicial proof is unnecessary. These procedures are an archaic bourgeois detail. This is a revolution! And a revolutionary must become a cold killing machine motivated by pure hate. We must create the pedagogy of the paredón [execution wall].” This man had a medical degree and was actually a physician but rather than save lives, he chose to take lives. Why were the murders necessary for the revolution in Cuba, because they required the wealth that the land owners held and also desired to take their land. This was similar in many of the communist and socialist revolutions where they promised the masses they would give them the farms, as that was often the wealth of the nation. One can guess what happens when you shoot the farmers and give your revolutionary soldiers the farms as a reward. Very soon, you find that soldiers do not make the greatest farmers and without the farmers, hunger is soon to follow and that was part of the collapse of the economy as well in many of the socialist revolutions.

 

Finally, we would like to disabuse people of a misconception we have heard a few too many times. This is that Robin Hood was a socialist. This is not true as the concept that he stole from the rich and gave to the poor, the rallying cry of far too many socialists, not in these exact words, it is usually stated as universal healthcare, guaranteed minimum wage, guaranteed employment, free college education and free computers, cell phones and anything else which is considered required to be part of the modern age. Robin Hood stole from the Sheriff of Nottingham and returned the funds from the governing body, the Sheriff of Nottingham, to the over taxed people. Robin Hood was giving the peasants and workers, mostly farmers and herdsmen, a tax refund, a sorely needed tax refund. When people came and took refuge with Robin Hood they were assigned tasks they were required to perform, a job to earn their keep. Robin Hood was attempting financial stimulus through a tax refund so the farmers and herdsmen could return to actually working with proper funds to sustain their farms and herds such that they could make a living and earn their way. Finally, believe it or not, Robin Hood was and still remains a fictional character. If only socialism had become a social construct which has been proven repeatedly to result in failure and misery and this relegated to the ash-bin of history, but there are those who still believe that this time it will work because they are the people who can perform a socialist society the right way. The Chinese figured out the right way to run a socialist society, by introducing a sizable capitalist segment within the society which is freed up enough to thrive and thus pay for the socialist projects of the governance. But as soon as you start a little capitalism, you will eventually end with a whole lot of capitalism as you will soon realize that greed is a great motivator and when you allow people to better their position in life, you can have an amount of socialism on the side paid for by your burgeoning capitalist economic engine.

 

Beyond the Cusp

 

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