Government and the Permanent Income Classes

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socialism-class-warfare-against-the-united-statesThe other day I was having a conversation with an individual who like many on the left believes the rich needs to pay more in taxes.  When I asked why he believed this, he responded, “Because they can afford it and it’s the only fair thing to do.”  So my follow-up question was why can’t we afford it?  I could see the question caught him off guard.  He asked me to explain what I meant.  I said, “Why has it become more difficult for us to achieve success so that one day we too may reach the tax bracket you are proposing for the rich.”  I could tell by the tilt of his head and the perplexed look on his face he was struggling to come up with a rational answer.  He finally replied, “Because big corporations are in bed with the government and crafting laws that protect them and hurt the little guy.”  Finally some root cause analysis was being utilized to get to the root cause of our problem.  But there’s more to it than just big corporations in bed with the government.  There’s the tax code and the over-regulation of our free market.

These three variables do help create an environment where permanent income classes are becoming a very real thing.  With each regulation enacted, or a law implemented that favors big corporations over smaller startup companies or the tinkering of our success punishing tax code it becomes much more difficult for the lower income class to move up into the middle class income bracket and the middle class income to move up into the upper income tax bracket.  It creates barriers between the different income brackets that shackle us to our current income class.

This is why the President’s rhetoric about class warfare was so successful during the last election.  A permanent class feeling is sweeping over the people.  Couple this with the Federal Reserve devaluing the dollar and now you not only have an environment that reinforces permanent classes but one that attacks all income classes by diminishing our purchasing power.  Have you noticed how much harder it has become to stretch the dollar?  How the price of goods and fuel are going through the roof.  How there is less money in your paychecks.  President Obama’s policies combined with the printing of money by the Federal Reserve are a direct assault against all the classes.  And he wants you to believe the problem is the rich don’t pay their fair share.  This assertion that the rich don’t pay their fair share is also an attack on the lower and middle income classes.  Because no matter how you slice it whenever wealth is taken from the private sector to fund inefficient government programs, wealth is destroyed and we all suffer for it.  It’s too bad so many have third grade understanding about the creation and destruction of wealth and the impact both have on a society.

Ronald Reagan was correct when he said government is the problem.  Look at where it has led us.  We now live in an America where permanent income classes have become a very real thing for many Americans; created by government via its laws, policies, and regulations.  Maybe if more people understood this, the less enthusiastic they would be about embracing government and its policies that foster and establishes a new kind of America with permanent income classes.  Maybe they would finally see that government is indeed the problem. I’m not holding my breath…

Liberty forever, freedom for all!

Original Post:  The Sentry Journal

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Big Fish Eat Little Fish: What Happens When There Are No More Little Fish?

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Then the big fish turn on each other until there are no fish. That would seem to be the logical end, don’t you think? Not exactly favorable to one’s self-preservation, is it?

It seems to this humble observer that this is what big governments do. They keep eating more and more of the food supply (the economy) until there is not enough left to support them. Are big corporations playing the same stupid game? Maybe that is what Kim Strassel is suggesting in this Wall Street Journal article.

…a growing collection of CEOs and big-business lobbies have fallen in line with President Obama’s cry to raise income taxes on those making more than $250,000. To listen to these CEOs, this is the ultimate self-sacrifice. “I would pay more in taxes” in a budget deal, explained the noble Honeywell CEO Dave Cote, but it would be worth it to “put the economy on a sounder footing.”

By “”put the economy on a sounder footing”, what Mr. Cote is saying is: “If my company makes more money by paying less taxes, the company can pay me more and I won’t mind paying higher taxes.” Ms. Strassel seems to support might interpretation when she says:

Put another way, the Roundtable saw an opportunity to make the one million small American business owners who pay individual income taxes shoulder a big rate hike (up to 39.6%, from 35%) while radically lightening the tax load for the Roundtable’s own corporate behemoths (to 28% from 35%). Any corporate tax reform hinges on closing “loopholes” to pay for a lower corporate rate. Small business owners would lose tax perks along with everyone else—meaning they would pay even more—but they would not benefit from lower corporate rates.

What is good for the goose is apparently not good for the gander”

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Some CEOs have taken to spinning bizarre economic logic on behalf of their position. Witness FedEx CEO Fred Smith, who recently explained that it is “mythology” that raising taxes on small business kills jobs. But it was true, he said, that lowering corporate rates for big business will help create jobs. Track that logic.

So, what is a conservative lover of small government and free market capitalism to do when he can’t trust his government and can’t trust the so-called bastions of free enterprise?

Walt Kelly’s comicstrip character, Pogo, once said: “We have net the enemy and he is us.” Pogo was profound on many levels.

Walt Kelly - First Pogo newspaper strip

Enough said!

Well, now you know what I’m thinking. What are your thoughts?

Original PostConservatives on Fire

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Massive Projection on Display: Democrat Hank Johnson Wants to Limit Free Speech

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We like to say that you always know what the Democrats are up to based on what they accuse everyone else of doing.  Here’s Hank Johnson, a Democratic Congress critter, on why he thinks free speech is a terrible thing…

OK, let’s look at some points here…

“They control the patterns of thinking,” said Johnson. “They control the media. They control the messages that you get. So, you are being taught to hate your government – don’t want government, but keep your hands off of my Medicare by the way. I mean, we are all confused people and we’re poking fingers at each other saying, well you’re black, you’re Hispanic, immigration, homosexuals. You know, we’re lost on the social issues, abortion, contraception.

Is this guy serious?  If this is so, why has every single Obama-related scandal been played down by the MSM?  If the corporations are in control, why haven’t the people heard of what really happened at Benghazi?  Why didn’t they know that ObamaCare would cause job losses and people’s hours to be cut?  Why don’t they know about “fast and the furious?”  Why did they lie about Sandra Fluke and $9 birth control at Target?  Why did they invent a war on women that didn’t exist?  Why didn’t they cover the voter fraud that occurred during the election?

I could go on for hours, but it does show how close to completely demented that they are.  They are essentially saying that the corporations are doing all of the things that the MSM is doing on behalf of Obama and the Democrats.

And let me guess, Corporations, whose workers voluntarily work, and whose customers voluntarily buy, are not people.  But, Unions, whose members are forced to join, are, right?

Projection is quite revealing, as it shows us what the other side is thinking and doing.

 

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You Didn’t Build That: Debunking the Leftist Narrative

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If we listen to the leftists, we hear two repeated messages…

Corporations are not people

No one get’s rich on their own, or, you didn’t build that.

Of course, these are parts of the class warfare lexicon.   For example, corporations are not people because their campaign donations help balance the torrent of big labor money to the democratic coffers.  So, it necessary to redefine them as “not people.”   Oh, and by the way, labor unions ARE people.  Don’t ask how- it cannot be explained.  Perhaps some strange metaphysical process is involved, or it is simply an asinine narrative?  You can be the judge on that.

Then, we have the whole concept that no one get’s rich on their own.  The idea here is that along the line, some teacher might have inspired, or someone gave support at a critical time, all going towards the person in question becoming rich.  Frankly, that might be true, but that is where the leftist narrative leaves the rails.  You see, that same inspirational teacher may have taught thousands of students at one time or another.  However, none of the other students became rich.  Perhaps it was the ideas, talents, or the drive of the rich person that made the difference?  Not so! According to the POTUS.

Also, it is said that if it weren’t for roads and other government sponsored infrastructure, businesses could not succeed.  To this is I must respond, who pays for the roads and bridges?  And, in fact, who pays for the teacher’s salary?  Is it the producers, those that work, create, and build businesses?  How would these projects and careers be funded without people doing something productive, and therefore paying taxes?

There are some breakdowns of who pays taxes.  The first is from US News and World Report (Hardly a Conservative organization).

In politics, perception often counts more than reality. First, for argument sake, let’s classify “the rich” as those in the top 1 percent of income earners. For 2009, the most recent data available, to be included in the top 1 percent you had to report Adjusted Gross Income (AGI) of just under $344,000.

That same year, the top 1 percent paid 37 percent of federal income taxes. The top 10 percent (this would include a public school teacher and a police officer each making $56,000 a year who are married and filing a joint tax return) paid 70 percent, and those in the top half paid almost 98 percent of all federal income taxes. That means the bottom half paid about 2 percent. In fact, according to the nonpartisan Tax Policy Center, 47 percent of households pay no federal income taxes. Does it seem fair that the top 1 percent pays only 37 percent? Or does the fact that the top 1 percent pays over one third of all federal income taxes seem unfair to the rich?

The second take on the same data comes from the Heritage Foundation…

Top earners are the target for new tax increases, but the federal income tax system is already highly progressive. The top 10 percent of income earners paid 71 percent of all federal income taxes in 2009 though they earned 43 percent of all income. The bottom 50 percent paid 2 percent of income taxes but earned 13 percent of total income. About half of tax filers paid no federal income tax at all.

Well, why are they are paying a higher tax rate than their percentage of income?  That is fair?  No, it’s not, because according to our leftist friends, they should be paying even more of their income, no matter that the scales are already stacked against them.

Let’s take a bit to examine this further.  If these rich people work for corporations (that clearly are non-human), they do need each other to make the system go.  Business owners, or CEO’s need everyone, from the warehouses, janitorial staff, and the mid level administrators doing their jobs to make the company work.  Once again, we have to recognize that without the ideas, drive, and talents of the creators of the business (those inhuman rich people), the janitors, warehouse staff, and mid level administrators wouldn’t have jobs.  You can replace a janitor, or a staffer, and most people wouldn’t even notice. But without a person at the top with the drive, ideas, and work ethic to do what it takes to make the business go, the whole operation can, and often does, fall apart.

Additionally, the drive and ideas of the evil and inhuman rich creates products and services that the rest of us want.  There are stockholders, retailers, salespeople, and scores of others that benefit from the distribution of those goods and services.  That drive and initiative to build a better mousetrap ripples through the economy, and the more ripples, the better it is for more and more people.   If the “builder” were not there, would the goods and services “poof” themselves into existence?  I think not.  However, if you listen to the POTUS, he seems to suggest that he can do that by decree.

And what of businesses and corporations not being “people?”

In a free state, people are able to freely make mutually beneficial associations.  Even if you want to call them “collectives,” you can. People join these “collectives” voluntarily, and break the relationship when one party no longer needs or wants the association with the other.  It’s freedom!  People take and quit jobs as they please.  Businesses, large and small, want to keep people that work well for them, and to replace those that don’t.  Consumers pick the products and services that they want.  Investors invest in the entities that they think will give them a good return.  It’s all volutary.  And, as evidenced by history, it works!

Until, that is, government get’s involved.

Now, let’s the two comments and tie them together.  From one side of the leftist mouth, we are told that people can’t get rich on their own, and that they need other people to make that happen.  However, the other side of that same leftist maw tells us that these people involved in a voluntary arrangement are NOT people.

Let’s briefly contrast the union arrangement; in a private company, you get to chose to stay or go, you get to make the choices, and if you do well, you might find yourself moving up, either at that company, or at your own.  The company has the same choices.  They can associate with you, advance you if they see potential, or terminate you if they don’t.  But, with the union, you are forced to join-there is NO choice.  And, if you do well, the work rules often won’t let the company pay you more.  Your drive, talent, and ideas have no bearing on your outcome, as the union won’t allow that.  You won’t get paid more than the drunk guy at the next work station.  In fact, if the drunk guy has more time in than you, you will be terminated first if there are layoffs.  In the leftist/union/government world, this is called “fairness.”  Of course, since your personal talents and abilities are meaningless, it’s the opposite of fair, but as usual, up is down, and right is wrong in liberal land.

But, even though corporations and small businesses are make up of people-voluntarily engaging in mutually beneficial relationships, they are not people, they are inhuman, and therefore can be deprived of their rights.  And, even though the productive owners, and even the workers of those companies pay far more than their “fair share” of the taxes, they should be taxed more.  Then, they are told that their efforts at building their businesses are irrelevant, and that government made it all happen anyway-even though the taxes paid by business owners funded the very government projects that the government touts as the reason for success in the first place!

Leftist “logic,” and explaining how completely bass ackwards it is, gives me a headache.  But, it has to be done.

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What Has Happened To Our Middle Class?

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First let’s talk about the meme that the “rich get richer and the poor get poorer”. That the rich are getting richer is without a doubt true. So, I won’t even go there. But, what about the poor? Are they really getting poorer? That would be a difficult case to make in America.

In Entitlement America, The Head Of A Household Of Four Making Minimum Wage Has More Disposable Income Than A Family Making $60,000 A Year. So, why does it seem that the percentage of our population that is classified as being poor never changes? Bruce McQuain ofQuestions and Observation uses a recent CATO Institute study to give us the answer.

The federal poverty rate is the percentage of the population below the federal poverty threshold, which varies based on family size.

A point that needs to be raised here is the poverty rate isn’t going to change no matter how much we spend because revisions to the threshold will always be such that about 15% of the population will be considered poor.

But are the people classified as being poor really poor?

Well, I’m not sure and neither is anyone else.  That’s because of the way poverty is measured in the US.  Essentially it is based solely on income.

The official poverty measure counts only monetary income. It considers antipoverty programs such as food stamps, housing assistance, the Earned Income Tax Credit, Medicaid and school lunches, among others, “in-kind benefits” — and hence not income. So, despite everything these programs do to relieve poverty, they aren’t counted as income when Washington measures the poverty rate.

So guess what remains the same?  The poverty rate.  If “in-kind benefits” were included in income calculations for those receiving them, a lot fewer of them would be considered “poor”.   And since it’s only based on income, many elderly who receive retirement incomes below the “poverty” threshold are considered to be poor despite the fact that they own paid off assets like houses and cars and live comfortably on that retirement income.  But they pad the stats and help to continue to justify the programs and expenditures.

I don’t question that there are some Americans who have fallen through the cracks and are definitely poor by any definition. However, it is not 15% or anything close to 15%.

What about the middle class?

Rick Moran at American Thinker wrote last month: Middle class wages dropping faster under Obama than Bush. Although that is true, back in 2010 The Daily Reckoning quoted this from a Financial Times article:

“Dubbed ‘median wage stagnation’ by economists, the annual incomes of the bottom  90 per cent of US families have been essentially flat since 1973 – having risen  by only 10 per cent in real terms over the past 37 years. […] In the last  expansion, which started in January 2002 and ended in December 2007, the median  US household income dropped by $2,000 – the first ever instance where most  Americans were worse off at the end of a cycle than at the start. Worse is that  the long era of stagnating incomes has been accompanied by something profoundly  un-American: declining income mobility…

And, last year CNN Money put out this graph:

income inequality

From the CNN link they wrote:

Incomes for 90% of Americans have been stuck in neutral, and it’s not just because of the Great Recession. Middle-class incomes have been stagnant for at least a generation, while the wealthiest tier has surged ahead at lighting speed.

In 1988, the income of an average American taxpayer was $33,400, adjusted for inflation. Fast forward 20 years, and not much had changed: The average income was still just $33,000 in 2008, according to IRS data.

CNN being CNN, you won’t be surprised that they put the blame on the decline of unions. Do you agree?  I spent a lot of years in the corporate world of the mining industry. All of our mines were non-union and we worked hard to create an environment for are workers so they would not want to unionize.  There were five attempts to unionize our workers and each time they were voted down. In part this was due to the fact that we always tried to keep our wages and benefits a little better than our unionized competition. maybe the company I worked for was an exception. Maybe there is an element of truth that the decline in unions has  reduced the competition in the labor market. How much of a factor that would be, I have no idea. But, competition in the labor market doesn’t come solely from unions. Low unemployment causes competition for labor as well and over the last thirty years America has seen periods of low unemployment but there is no evidence that wages raised during those periods.

So, what is going on? Are the Occupy crowd correct? Are the one percenters nothing but a bunch of greedy bastards?  The CNN article linked above had this to say:

Meanwhile, the richest 1% of Americans — those making $380,000 or more — have seen their incomes grow 33% over the last 20 years, leaving average Americans in the dust.

Maybe there is something to what the Occupy folks say. Corporations keep setting records for their profits and upper management is being well taken care of; but the rest of their employees are seeing their wages stagnate at best.

There is, however, well defined labor market prices. There are a number of companies whose business is to produce wage data for almost every class of worker for every region of the country. It is reasonable that no company wants to be the price leader in the labor market; yet they know they must be competitive. I recall a young women who I had recently promoted to the position of Chief Account back in the early eighties. She was doing a first class job, she was very efficient and, she put in all the hours necessary without any prodding from me. In her new position, she was privy to the salaries of all our staff. One day she came to me to complain that she had a college degree and was a professional accountant and she didn’t understand why a maintenance supervisor without a highschool degree was making more than she was. I had to explain the job market to her. I told her that I could replace her, if she left, with an equally qualified person at the same pay than I could if the maintenance supervisor were to leave. The maintenance supervisors position, due to supply and demand, commanded a higher salary. That is the way the world works. But, I am not willing to let our so-called “capitalist captains of business” off the hook. While making record profits, they are missing out on what i believe would be a good business decision by not reinvesting some more in their workforce. A thriving middle class would be could for all businesses. If they don’t want to be a price leader in the labor market, I think they should consider giving vacation bonuses or Christmas bonuses. More money in the pockets of the corporate workforce would indeed stimulate our economy and they would probably see their profits grow even more. If the current trends continue, the one percent will be fine and the rest of us will be on food stamps. That would make Obama happy.

Well, that’s what I’m thinking. What are your thoughts?

Original Post:  Conservatives on Fire

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Video: The Burden Big Government Puts on a Small Businessman

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Via Small Dead Animals I found this 2 minute video from Senator Jim DeMint(Republican, South Carolina) which explains how big government is making it harder for Americans to find jobs and more difficult for small businesses to succeed. As the video shows in an amusing way, when big government puts too many burdens on America’s economy, it forces jobs and investment overseas instead of here at home. It also makes it harder for middle class small business owners to compete against large corporations (who receive exemptions and build loopholes into legislation through their lobbying), discouraging real competition and job growth.

Original Post:  A Conservative Teacher 

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Some Thoughts on the "Occupy Wall Street" Protests

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I’ve been following the moonbat fest in New York, as well as in other locations, though I haven’t written about them until now.  It really started as a non-story, though the MSM and the union bosses seem to be building them up.  So, here are some of my thoughts about them.

I get the impression that they’ve been coached to be very careful about what they say to the media. Let’s look at some general statements, and the CH 2.0 translation.

“Greed”= Communism

“A more equitable system”=Communism

“Democracy”=Communism

“Evil Corporations”=Communism

Am I overgeneralizing?  Perhaps, but from what I have seen and read, these are mostly young, terribly misinformed, and horrifically misguided people.  They either know what they want, and are choosing not to say it openly, or they are the most useful of the useful idiots.  That, and no one is going to take them seriously, other than other misguided and misinformed, useful idiots.  I wonder if they realize that most of them will be killed if they actually get the “more equitable democracy” that they desire?  Obviously not.

They are setting the stage to justify violence by engaging in typical leftist tactics.  They are blocking traffic, trespassing, and generally making a nuisance of themselves.  Then, when the police come to arrest them, they make it as difficult as possible. As soon as the police do a thing, they cry brutality.  Then, they can use this as a justification to gain more followers, as well as for the eventual violence.

Will violence occur?  I’m not sure.  However, I have spotted some anarchists in their midst (not that it’s that hard).  As we all know, anarchists are well known for their violence.  Also, big labor is now supporting them, and they are very well known for violence.  So, all the parts are in place.  All they need is the match to light the fire.  As I pointed out previously, there seems to be buildup for violence.  The only question is if it reaches critical mass.

There have been a lot of pundits being very dismissive of these protests.  They mention the lack of showers, that some of them have no clue as to why they are there, and that they seem very disorganized.  All of these are at least partially true.  However, we cannot judge them as we judge ourselves, as they are not at all like us.  Most of the readers here are adults, who have families, careers, and a desire not to lose what we have worked so hard to earn. Also, we have a vested interest in human freedom.  We actually believe in the promise of our Republic, and that if it falls, it might be centuries before humanity recovers.  In the end, they aren’t going to understand the need to maintain freedom, and would unwittingly, and gladly give away our freedom to achieve their rather amorphous ends.

Sadly, the protesters have apparently fallen into the trap of believing in the all-powerful state.  To achieve the more “equitable” system that they desire, an immensely powerful government will be needed to confiscate from others to redistribute to others.  There is no other way to accomplish this level of theft.

Also, the protesters do not state what they would do with the individuals that they rob or strip of their freedom.  People will not be willing to give up what they have built or created.  What will be done with them?  Others will not submit to an all-powerful nanny state.  What will the new “order” do with the new “refuseniks?”  What will this new “system” do with people that speak out against the system, or point out the inevitable failures of that state? Any government, given that level of power, will become abusive. History tells us what will happen.  There will be death on a scale that this nation has never seen.

I have seen some suggestions out there as far as infiltrating these protests.  I think that is a fine idea. However, it should not be done in the same way that leftists did when they infiltrated the Tea Party.  Their efforts were false flag-sending in activists to say racist and other outrageous things, so Think Regress could make videos of them.  We don’t need to say outrageous or strange things.  They are doing that all by themselves.  We have no need to help, nor do we need to stoop to their level.  The reason that I suggest infiltration at all is that they are, in my opinion, being very careful with their message.  However, someone wearing a hidden camera or a microphone would be able to get into private conversations with protestors, and record more candid thoughts.  That, my friends, might be a great way to get to the core of these protests.

Well folks, those are my thoughts on the issue.  As always comments are always welcome.

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