Taxes and the Rich

I think that there is a strange "soak the rich" mentality in this country. The thought being that; it is somehow unfair that they are rich and the rest of us are not. That is the basis that the Obama Administration uses in their justification that the "rich" need to pay more taxes.

Here are my top five thoughts on "the rich" and taxes:

Who is rich?

For the sake of argument let's call the "the rich", households that have an income over $200,000. Where does that leave the people who have tons of money and have no job? Or the folks that have tons of money and that actually lost money during the last year? For example: Let's pretend that Bill Gates made a couple of bad investments (can that happen?) and lost $500,000,000 on a particular year. Would that make him poor? Based on the income test it would.

Why are the rich not celebrated?

Many of the "rich" in this country have earned their money. They worked hard and and built their income from nothing. In other words, they have achieved the American dream. What is wrong with that? Sure there are some John Kerry's out there that married money or Paris Hilton's that have it gifted to them, but honestly they are very rare. If your goal in life is to have more money than Bill Gates, then do what Bill Gates did, build a computer software empire. Don't stew and blame somebody else for succeeding.

Who pays you?

Everyday I go to work and after 1/2 a month I get a check, signed by the owner of the company. The owner paid me from the income he earned from his motel. The income that he will put on the Gross Income line of his personal income taxes. Other things he paid were supplies, electricity, other employees, taxes, water, etc, etc, etc.

What does that owner do when his income is taxed more? Does he stop buying electricity? I would bet that not to many folks would rent a motel room without electricity. You ever eat at a restaurant without food? I think not. His choice would be to cut employees, employee's pay or if the tax is high enough close the business. You see where I am going with this? Just because somebody has a large income does not mean he has a lot of money and when he stops earning money he will do what it takes to earn money again. So when they talk about raising taxes on people with incomes over $200,000 that effects you. Small businesses will cut expenses to keep earning money. Is the expense they cut going to be your job?

What is rich?

This is the philosophical portion of this post. Would I like to make more money? You bet. It would make one portion of my life eaiser, the finical portion. Does that make everything better? Maybe we should ask Lindsey Lohan, Britney Spears, Charlie Sheen, or Mel Gibson. Is there life better because the have a lot of money? I think not.

When I go to meet God will that extra money do me a lick of good? Nope. When you are swinging on the porch in your old age, would you rather spend your time thinking about the fun you had with your children or your bank account balance? Should your obituary state things like: "a giving man, a loving father and husband always honorable" or would it just say "he made lots of money". My point is simple there is MUCH more to life than money. Live it.

What do the founding fathers say?

The founding fathers did not guarantee happiness. They guaranteed the the pursuit of happiness. They did not guarantee wealth. They guaranteed the pursuit of wealth. So why do we punish those who achieved their pursuits? Isn't that just wrong? It is like saying: "You are free to pursue whatever you want as long as you don't get."  I don't think that is what is the founding fathers had in mind. I think that changing tax rates on all but "the rich" is wrong and would not be approved by our founders. What do you think?

A little poem
About 20 years ago I clipped a poem from the newspaper (I can't remember which one) and it hangs in my office today. It is very fitting for this post:

Taxes! Taxes!
Tax his cow, Tax his goat
Tax his pants, Tax his coat
Tax his ties, Tax his shirt
Tax his work, Tax his dirt.

Tax his chew, Tax his smoke
Teach him Taxes is no joke;
Tax his car, Tax his gas
Tax the road he must pass;
Tax his land, Tax his wage
Tax his bird, Tax its cage
Tax his tractor, Tax his mule
Tax the books used in schools.

Tax him good let him know
That that after taxes he has no dough
If he hollers, Tax him more
Tax him till he's good and sore.

Tax his coffin, Tax his grave
Tax the sod in which he lays
Put these words upon his tomb;
"Taxes drove me to my doom"

And when he's gone
they won't relax
They'll still be after
Inheritance Tax!

Stop Huge Jidette's Presidential Try...

Just when you thought we were done with campaign commercials, now we have to deal new "candidate" in a Presidential race...


Rally - HD from Peterson Foundation on Vimeo.


Kissing Babies - HD from Peterson Foundation on Vimeo.


Main Street - HD from Peterson Foundation on Vimeo.

Mourning in America

President Calvin Coolidge on Spending and Taxes

I've posted this before, I believe, but it is worthy of listening to again. This is the first Presidential movie with sound, it  intresting that it would be a conservative speech. President Coolidge is in my top 5 favorite Presidents...
 

Reagan on the Recovery

Sounds like a plan ...lower taxes and reduce spending....

Obama Tax Increase

The Obama Administration believes (currently) that we should extend the Bush Tax cuts to the 95% of the people who make less than $250,000 a year but keep them for "the rich" who make over $250,000. He likes to call them middle class tax cuts.

OK, first off let's get the terminology correct. It is not any kind of a tax cut. The taxes were already cut, back in 2001 and 2003 (remember the evil Bush years?). So what is being decided is a tax increase not a tax cut.

The next question is about taxing "the rich". Those people who have sacrificed their blood, sweat and tears to accumulate their wealth. They have succeeded in America, so we must punish them. We are not talking about the Bill Gates and the Rockefeller's here, those in the super rich class already have their money. We are talking about INCOME TAXES. Not possession taxes. You will not hurt the super rich, because they do not earn the majority of their money on an annual basis.

The people you are punishing are those "rich" people who depend on their income to keep their business in operation...low and behold the real small businesses men. These people may have a large income reported on their personal income tax forms, but they also have large expenses as well, such as payroll for other working men and women.

So it appears that the Obama Administration just seeks to harm the creation jobs in this country by INCREASING THEIR TAXES. Taxing job creators does not sound like too smart of a  thing to do in a depression (or Great Recession). 

Obama Tax Hike...the Movie

Proposition 101, Amendments 60 and 61

There are three measures that are going to be voted on this year Proposition 101, Amendments 60 and 61. These are the ballot questions:

Proposition 101

Shall there be an amendment to the Colorado Revised Statutes concerning limits on government charges, and, in connection therewith, reducing vehicle ownership taxes over four years to nominal amounts; ending taxes on vehicle rentals and leases; phasing in over four years a $10,000 vehicle sale price tax exemption; setting total yearly registration, license, and title charges at $10 per vehicle; repealing other specific vehicle charges; lowering the state income tax rate to 4.5% and phasing in a further reduction in the rate to 3.5%; ending state and local taxes and charges, except 911 charges, on telecommunication service customer accounts; and stating that, with certain specified exceptions, any added charges on vehicles and telecommunication service customer accounts shall be tax increases?

Amendment 60


Shall there be an amendment to the Colorado constitution concerning government charges on property, and, in connection therewith, allowing petitions in all districts for elections to lower property taxes; specifying requirements for property tax elections; requiring enterprises and authorities to pay property taxes but offsetting the revenues with lower tax rates; prohibiting enterprises and unelected boards from levying fees or taxes on property; setting expiration dates for certain tax rate and revenue increases; requiring school districts to reduce property tax rates and replacing the revenue with state aid; and eliminating property taxes that exceed the dollar amount included in an approved ballot question, that exceed state property tax laws, policies, and limits existing in 1992 that have been violated, changed, or weakened without state voter approval, or that were not approved by voters without certain ballot language?

Amendment 61

Shall there be an amendment to the Colorado constitution concerning limitations on government borrowing, and, in connection therewith, prohibiting future borrowing in any form by state government; requiring voter approval of future borrowing by local governmental entities; limiting the form, term, and amount of total borrowing by each local governmental entity; directing all current borrowing to be paid; and reducing tax rates after certain borrowing is fully repaid?

I have read that Colorado Attorney General John Suthers and Reeves Brown, spokesman for Western Slope advocacy group Club 20 believe that these measure would result in "complete anarchy". Really?
Colorado's  budget is about 20 billion dollars. These measures would limit 2.2 billion in taxes. So you are telling me that if you eliminate 10% of a budget that it would cause anarchy? Let's get real people.  What limiting 10% of the budget does do is prevent us from paying interest (wasted money) in borrowed money. It also puts $2.2 billion back into the economy where the people can decide how to spend that money not the government. When businesses look for places to place setup shop, one of the main things they look at is the tax burden. If we lower that burden I believe it would also bring in more businesses (ie: more tax revenue). Will it be hard to do? Sure. But it can be done.  I'm for any idea that limits the power (money) of government.

The Misery Index

Listeneing to the Bill Bennett radio show this morning the fill in guy  (I can't remember his name) mentioned the Misery Index. I had forgot all about this little index made popular during Jimmy Carter's administration. This index is simply adding the unemployment rate and the inflation rate.

You can find the misery  index here.

It is interesting to note that the largest drops in the misery index were where the Presidential administrations of Truman (10.18 reduction) and Reagan (9.61 reduction) lowered taxes and the largest growth was during spending hike years of Nixon (9.21 increase), Carter (increase 7.00). B, Hussain has already grown the misery index by 3.01 to the current index of 10.74.

What scares me the most about Obama's number is that we have had deflation and no inflation to note of yet during his term.  When is the other shoe going to drop? When inflation starts (and I believe it will soon) I can see that misery index going through the roof.  Welcome home.... 1970's.

The good thing about all this economic "malaise" is, that I think it will bring us another Ronald Reagan and we sure use another Ronald Reagan now.

The Broken Window Fallacy

So you think that World War 2 helped break the depression? How about 9-11? "stimulus packages?" I don't think so, check out this video from Eyeblast.tv

Here's a Democrat that Understands Tax Cuts

Harry Reid says Taxes are Voluntary!

I guess we don't really need to worry about our taxes, like I posted below in Fred Thompson on Our Tax Increase. Because according to Harry Reid they are voluntary anyway....

Fred Thompson on our Tax Increase

We are coming after you!

This should make you scared. It frightens me just a bit....

Visualization --100 million dollar tax cut

Obama Budget Cuts Visualization

Tax Freedom Day - Remy

Here's a funny video (but true) about taxes....

Click here to get to another Remy song about taxes.

Tax Day Rally in Grand Junction Today!

There is a Tax Day Rally today in Lincoln Park at 5:30pm. With that,I thought I would give you some interesting numbers as of today....

U.S. National Debt...$12,815,000,000,000
Debt per citizen...$41,500
Debt per taxpayer (people who filed a tax return, realize not all of those people actually pay taxes)...$116,600

Federal spending (approved by Congress and spent this year) $3,549,000,000,000
Federal tax revenue .... $2,125,000,000,000

Total national assets $72,385,000,000,000
Total unfunded liabilities $108,266,000,000,000
(So if we sold everything in the country we could not pay for all of the liabilities we promised to pay)

Total national assets per citizen...$234,205
Total national liability per citizen...$350,299

Total of all debt (Federal, state, local, household)...$55,769,000,000,000
Total debt per citizen...$180,442
Total debt per family...$690,155
Income per family...$62,054

Actual unemployed ...26,100,000
Official unemployed...15,070,000
Food stamp recipients...39,300,000
Bankruptcies...1,411,000
Foreclosures...861,619

I will see you at the rally today!

Silent Cal gets it...

Here's a video of President Calvin Coolidge addressing the country on government fiscal responsibility. It is interesting that the first Presidential film would be of a conservative talking about fiscal responsibility...

The Fair Tax

As April 15 approaches and you are struggling to fill out those ugly tax forms I thought I would post my opinion on the Fair Tax. For those of you that know all about the Fair Tax this can be a little refresher. Those that don't know anything about the Fair Tax than you will be pleasantly surprised that taxation can actually be fair.

The Summary

It abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax administered primarily by existing state sales tax authorities. You only get taxed on what you spend not on what you earn. No more tax forms, no double taxation.

The Examples

I learn best by example so let me give you a couple of examples...

1) Currently there is a farmer that has a peach orchard. He has a worker named "Joe" that picks peaches. When Joe gets his paycheck, he finds that they have taken out Federal withholding, Medicare, and Social Security from his paycheck. The farmer also pays income tax and Social Security taxes, which he adds into the price of the peaches he sells to the peach cannery.

At the peach cannery they buy the farmers peaches and put them in cans and sell them to the grocery stores. The business owners of both the cannery and the grocery store both add the income taxes and social security taxes that they pay into the price of the peaches. The customer is then paying the hidden cost of taxes from three different businesses and their employees.  With the Fair Tax, only the end result (the canned peaches) is taxed. Thus eliminating all the "hidden" taxes in the product, and bringing the price down.

2) OK, so let's go back to the farmer and his worker Joe. We find out that the farmer isn't really ethical and likes to hire illegal immigrants. Then we find out that Joe's real name is ,and is an illegal immigrant. The farmer pays Jose cash under the table. Jose not being really "into" obeying laws of this country likes to spend most of his money on illegal prostitution and meth. Jose can do this completely tax free. 

Under the Fair Tax, people like Jose and the prostitutes and drug dealers that supply Jose, would be paying the same taxes as everybody else in this country. They pay the tax when they purchase legal items at a store.

3) Lets make Jose an honorable guy again. He pays his taxes now and has a wife and 4 kids. Picking peaches is what Jose does while he is going to night school to try to become a peach farmer. His wife Jane can't really work anymore than she already does because everybody knows that a woman that has 4 kids is doing the work of 3 men.  They struggle everyday to try to make ends meet.

You might ask how why we would want to penalize Jose for doing everything he can, to make himself better by giving him a 23% tax increase with the Fair Tax.  There is a "prebate" system set-up in the Fair Tax bill. So people who are below the poverty line would get a check each month to help them pay for the taxes they will incur during the month.  Plus the products Jose and his family buy will be cheaper with no additional taxes buried in their price.

So that is my poor attempt to explain the Fair Tax. This is a place to start a conversation. It is a good idea.  You can get much better information by going to this website: The Fair Tax

Social Security vs Health Care

I only got to watch a small portion of  Democrats Health Care Theater. The portion I did get a chance to watch was the actor Joe Biden rambling on about how good Social Security was and how much it was opposed in 1935. That got me thinking (for Democrats that is the little voices in your head), what it must have been like in 1935 when the Social Security debate was going on in Congress. 

First off I think it is important to "set the stage". There was a economic depression going on in the country, coupled with a crippling effects of the "Dust Bowl". Poverty rates among senior citizens were more than 50%. There was talk overseas about a new political idea which helps people having economic hardships (socialism). I believe the American public was begging for some help to get them out of their current economic woes, then along came F.D.R.

The Congress was overwhelmingly Democratic. The Senate distribution was 69 seats Democrats, 1 Farmer-Labor Party, 1 Progressive, and 25 Republicans, for a total of 96 seats (pre-Hawaii and Alaska). The House had  322 Democrats, 3 Farmer-Labor Party, 7 Progressives and 103 Republicans.  One of the biggest concerns at the time was that the Social Security Act would cause a loss of jobs. The Democrats answer was that it wouldn't cause a job loss, because more people would retire creating jobs. (Sound familiar?)

There were two bills passed, one by the House and one by the Senate. Then the diffences of the bills were resolved (I can't find much on how they were resolved...must have been a back room deal).

Strangely the first check was not issued until 1942, but don't worry they were collecting  social security benefits from 1937.  They used to have lump sum payments of social security checks. The first check was for 17 cents. The guy had "contributed" one nickel form his payroll check. He was in the social security program for one day.

Why do I bring up all this history? Because I want people to see the similarities of the enactment of Social Security and the current health care bill.  Americans were having difficult times and they were looking for something...anything to help. I contend that F.D.R. was the first President to use the theory of "Never let a crisis go to waste", although not called that at the time.

What was the end result of Social Security? As a nation we have $107,594,000,000,000 ($107 trillion) worth of unfunded liabilities (Social security, Prescription drug plan, Medicare). That is a liability of $348,470 PER CITIZEN! Yeah that program worked real well. Why the hell don't we do something about that, instead of adding more debt, so some bureaucrat in Washington can make my medical decisions? it is simply crazy!

I have been asked "If you think Social Security was such a bad idea why don't I just refuse to accept Social Security benefits when I retire?" The answer is simple... I want my money back. I was forced to "contribute" thousands of dollars to the system and I only know one way to get that money back, accept the benefits. 

There is no way we can afford to have a government controlled health care plan. Please contact your Representative and/or Senator and stop the insanity. We can't let them steal this money from our children!