Economic Madness Writ Large - The Current Tax Debates

If it weren’t so serious, the implosion of the hard-core left (otherwise known as Obama’s base) would be rather amusing. I’m talking about the debate surrounding the President’s compromise on the extension of the Bush tax cuts. It seems that a deal has been reached that has managed to piss off just about everyone.

Everyone in Washington, that is.

The interesting part is, the issue that has their knickers in a twist is exactly what should have happened two years ago. Our corporate tax rates are the highest among developed nations, and this is greatly harming our ability to compete in the global marketplace. There is an economic axiom, known by all except those inside the Washington Beltway who craft our economic policies, that if you want less of something, tax it heavily.

Even more intriguing is the fact that simple, proven, economic principles aren’t well known, nor it appears, comprehended by our ruling elite. There can be no doubt that the past four years of a Congress led by progressives have resulted in economic catastrophe for the country. For a short list, click here.

As I’ve chronicled, there are very sound reasons for our economic plight, none of which need to happen. We could be free from this recession if only we had the proper people in place in Washington who knew what the rest of the country already knows about finances. Despite what the elites tell you, economics is a simple science: if you’ve ever balanced your checkbook, then you know more about economics than Timothy Geithner and Ben Bernanke combined.

And Nancy Pelosi, who thinks that unemployment insurance payments stimulate the economy. Sorry, Nan, you couldn’t be more wrong. UI is merely a placeholder until a real job comes along. I don’t know anyone who would rather be collecting unemployment when they could make far more money with a real job.

The disconnect with reality in Washington is breathtaking.

In addition to the needless confusion about what to do to kickstart the economy, there is another wrinkle of this debate that should concern you – class warfare.

Doesn’t it strike you as rather odd that a group of millionaires should want you to be angry with millionaires? Why? What did a millionaire ever do to harm you? Maybe it’s just me, but I can’t find a scintilla of logic in that argument. What I do find is psychosis, namely the psychosis of power, willing to divide a nation along economic lines to achieve it.

It wasn’t always like this. There once was a time when we aspired to greatness in America. Someone would create a better mousetrap and the world would beat a path to the mousetrap makers’ door, cash in hand. Every American wanted to become rich, every American had the opportunity to become rich. We still do, but there has been a movement, closely tied to the political left, that has poisoned this once-great idea. It’s become so entrenched in Washington, said so often in sound bites, that it’s starting to affect the rest of the nation. That poison is called class envy. It’s practitioners, well versed in their own foibles, project their problems onto the innocent in an effort to appear perfect in their own eyes.

This has led to the perversion that mistakenly thinks that everyone should be equal instead of having equal opportunities to excel. Note how this runs counter to their professed belief in diversity. We should all celebrate diversity, however when it comes to recognizing that people have diverse abilities, and thus will have diverse outcomes given the same circumstances, they all of a sudden demand equality.

That, gentle readers, is psychosis.

And we’re seeing psychosis writ large in this debate on maintaining the Bush tax rates. Millionaires on the left criticizing the moneyed in our society, the very thing that allows these elites to run for office. There aren’t many working folk running for office, due primarily to the constraints of money: they are too busy providing for their families.

Let’s stop for a moment and use their twisted logic:

1. They want us to hate the rich because they are somehow evil.

2. They are rich.

3. Yet, they don’t want us to hate them.

4. ?

In fact, the opposite is true – the ruling elite wish us to become disengaged from politics so we can leave everything to them. They balk at any efforts to reduce their power or restrain them in any way. Hell, they won’t even subject themselves to the laws that they create for the rest of us.

Folks, in case you haven’t noticed, we can’t keep going on like this. Not and keep our freedom and prosperity.

We must restore sanity to our government. We started to do that in the mid-term elections. We must insure that this is the last gasp of progressivism in our nation. Like an exorcism, all of the evil comes spewing out at the last, right before the evil spirit's death and things get back to normal for the victim.

We must eliminate the mental illness of political liberalism if we are to survive.

Dems Flunk Econ 101

The reaction by the left to President Obama’s deal to extend the Bush tax cuts has been predictably bad. His base is sorely disappointed that he didn’t fight to increase taxes and their posts prove it. Another thing they prove is that those on the left are economic illiterates.

I am amazed by the comments in forums about Obama maintaining our current tax rates and extending UE benefits for another 13 months. Check them out here and here. The level of misunderstanding of basic economics is astounding.

In our free market economy, each new mandate is a burden on business. It imposes a cost on the business that the average employee never sees, but is paid anyway. Yet this basic economic law is lost on them. Also lost on them are the basics of wealth generation. Check out this quote from none other than Nancy Pelosi concerning the impact of unemployment benefits:

"...Unemployment insurance returns $2 to the economy for every $1 spent," said Pelosi last week. "This is money that is needed by families to buy necessities, to heat their homes... and immediately injects demand into the economy, creating jobs."

Now, I’m not sure where to start on her statement other than to say that every word of it is wrong, including the “and’s” and “the’s.”

How can she dictate national economic policy correctly if she fails to understand the basics of a free market economy? Oh, wait, our current unemployment rate of 9.8% is proof enough that she doesn’t know what she’s doing. Remarkably so, this woman is allegedly worth a great deal of money.

There are some on the right who aren’t too up on economic theory, either. Check out this comment from Foxnews.com’s Bradley Blakeman concerning the debate over Obama’s recent deal to keep our current tax rates:

“Republicans believe that the way to get people back to work is by incentivizing the private sector not penalizing them and paying citizens to be idle and unproductive.”

“Republicans believe?” We’re not talking beliefs here. We’re talking about economic laws and what happens under a repressive structure of government that is openly hostile to the creation of wealth.

Washington is the main reason our economy is in the sorry shape it's in today. Too many rules, regulations, and high tax rates have finally caught up to us, resulting in the closest thing to a depression that most of us have witnessed in our lifetime. There is a root cause for our current situation: the Community Reinvestment Act. This single piece of legislation forced banks to make loans to those who were bad credit risks and could not otherwise afford a home. Under the penalty of law, banks started losing money, which they attempted to bundle into other financial packages to offset this new federal requirement. And it worked for a while, right up until the presidential election of 2008. That’s when the excrement struck the air-moving device and our economy tumbled into the deepest recession in modern American history. We’re still in it because of the economic ignorance of those we’ve managed to elect to high office in Washington.

We can't keep putting restrictions on the "evil rich" and expect to maintain our economic power, it's that simple. Yet, we keep on voting for economically illiterate politicians who know nothing about how our free market economy works. In addition, those same politicians cater to their left-wing base, which insists upon punishing those in society that provide us with the money to maintain our way of life. The same way of life that is the envy of the world, the same way of life that has people from far away lining up to become Americans.

If you're still confused as to how this works and your eyes glaze over when the talk comes to economics, mathematics, percentages and tax rates, watch this video from Lee Doran entitled "Bar Stool Economics" (courtesy of The Right Scoop.com) and glaze no more.



If we want to keep our good paying jobs, we need to start electing pols with real-world experience. There is a reason why we're suffering needlessly under Obamanomics: he and his advisors have no experience in the business world and have never run a business. I'll give them the benefit of the doubt for a while, but their continued insistence upon more and more federal intrusion into our daily lives is hurting our ability to do business and generate wealth.

Also, don't buy into the class warfare that the Dems are always spouting. It takes a certain type of psychosis for a rich person in Congress to divide Americans along economic lines. Don't you want to be rich someday too?

If you side with them and you later become rich, how do you think you'll be treated?