Conservative Refocus
By Barry Secrest
The traffic was about as bad as I can remember it being on any day, and this was in a suburban shopping complex located just outside of Charlotte, NC. Cars were careening around from any and every direction, mid-afternoon on a Saturday, in what normally would have been a lull, as the humid, southern heat of the afternoon finally found its purchase.
But this day was obviously different, as the normal throughways of the parking lot had become a desperately vigorous maze , one which could have competed effectively with the mysterious shrub labyrinth in "The Shining." Still mystified, I suddenly jammed the brakes as a sedan, driven by an elderly kamikaze pilot, shot past, her silvery hair seemingly aflame with the need for speed.
"What in the world," I peevishly wondered; then it dawned on me....it was the annual North Carolina tax free weekend, and the shoppers were going absolutely nuts.
As I pulled the big truck into motion again, a spate of Conservative logic tappped me on the shoulder and bade me to take a closer look at what was truly happening.
Relaxing the tax rate stimulates economic activity into hyper-motion, as consumers naturally use every means at their disposal in order to 'buy more' in periods of lowered tariffs.
But, then, doesn't this go against everything that the White House and the Democratic Party have been telling us?
Indeed, it's true. Only a few weeks earlier, and even throughout the President's term, Obama and his team of economic brainiacs have been proselytizing over how increased taxation will ultimately result in more economic activity for everyone, somehow. But then, if one simply takes the hugely popular tax holidays that many US states annually run, and then looks at the stimulating effects that such holidays generate, we can verifiably see what really stimulates an economy. In fact, some retailers report sales increases of anywhere from 30 to 40%, with most verifying a tangible increase in business.
But what about the entire US economy? Could a relaxation in taxes work to stimulate the economy here, as well?
Almost certainly, is the answer, especially if done in such a way as to maximize US tax revenue; in fact it's worked every time it's been tried. From Ronald Reagan to George W. Bush, each time taxation has been relaxed, not only does the US Treasury begin to magically refill itself again, but economic activity takes off into the stratosphere, as well.
In the above tax revenue chart from the OMB, please take careful note of the years beginning in 2003 and on through 2008. The Bush tax cuts began in 2001 and were completely in place in 2003. From 2003 and onward, one can clearly note a dramatic increase in yearly revenues, right up until 2008 when the financial meltdown occurred. In fact, in the years between 2004 and 2008, annual income revenues actually increased by over a half a trillion dollars.
So, what were the Bush Tax Cuts that everyone keeps talking about, anyway?
These cuts were an effort to update the tax code, both in 2001 and 2003, while stimulating growth by moderately cutting taxes across the board for virtually all income groups. Unfortunately, shortly after the first act was passed in 2001, the US was subjected to the 9/11 terrorist attacks, which had a withering effect on the US economy, but only for a time.
The later tax act of 2003 helped to put the US economy back on track, while maintaining unemployment levels at approximately 4% throughout the remainder of Bush's term and until the collapse of 2008. The main problem was the fact that the tax cuts were planned to expire in 2010, which is why the batttle has raged continually between "no new taxes" Conservatives and the "tax everything that moves" Liberals throughout the Obama tenure.
So if the tax cuts were such a wonderful thing, then why did the economy meltdown in 2008?
Easy. It had nothing to do with taxes, but rather, the meltdown had everything to do with the US government insisting on giving loans to people who could ill-afford them, and then the banks compounded the problem by crafting ways to hide, deflect or defer the horrid loan losses that eventually burst the bubble. Government meddling in housing and banking is the penultimate answer to the question of "why."
But then, the next question naturally arises as to why Obama doesn't try cutting taxes in order to stimulate the US economy into moving forward again, rather than dolling out money to big corporations and Unions?
Aside from Obama's cronies and the Left-Wing Capitalists, should the unemployed, those on welfare, and the usual Progressive suspects be the only recipients of the nation's increasingly dwindling largesse?
Unfortunately for America, the President's revolutionary answer to this particular question would be a resounding 'yes,' in that none of the actual taxpayers, according to our radical potentate, are worthy or even deserving of a break. It's simply that the nature of this particular redistributive beast of a President will not undertake to stimulate an economy that he presides over, under the auspices of free market principles. In fact, Obama's sudden acceptance of Capitalism's most basic principles would be like finding a communist manifesto scripted on the backside of the Declaration of Independence by Jefferson; it's simply not going to happen, and certainly not by executive decree, in this case.
But, in order to understand how heavily America is overtaxed, below is a graph of the top five nations and their tax revenue, in terms of populace:
Top Five Most Populous Countries in Government Tax Revenue compared to population
#
Country
2011
Population
2011 Revenue
1
China
1,336,718,015
$1.64 Trillion
2
India
1,189,172,906
$564 Billion
3
United States
313,232,044
$2.1 Trillion
4
Indonesia
245,613,043
$185.4 Billion
5
Brazil
203,429,773
$464.4 Billion
As depicted in the chart, despite an enormous amount of yet remaining wealth, the US is paying a comparatively confiscatory rate of taxation, and Obama only wants that number to be greater, as evidenced by his failing to tackle the problem of outrageous spending, new Obamacare taxes, and his continued demands to levy the wealthy even more than already.
So, then, what is the actual problem regarding the US economy?
The below chart tells the actual story far better than words ever could:
Do you see the thin blue line running across the top of this CBO chart?
That line indicates the actual problem that's raging out of control in America today. The US government's level of spending, or 'expenses,' represented by the this thin blue line, is actually running higher than at any other time in US History. At present, our percentage of expense to GDP is running higher even than in World War II when, at the time, most of our energy and funds went into fighting two tyrannical world powers, both to our west and to our east, who were trying to forcefully take over the world during that time period.
So, who are we fighting now that would justify this level of spending over income?
The obvious answer is both "some few of the people" and the Statists currently running the government, many from both parties, but most from the Democratic party.
Indeed, it seems that many individuals, now-a-days, who desire an income, become depressed when they discover that working is a rather dreadful requirement to that end. Remember also, that instant gratification in the video game age has become the rule for quite a few individuals, rather than the exception.
But what about those who have stated, including the President, that Obama has actually spent less than any other President in history?
The answer to that question is "mere wordplay," coupled with a potent disdain by the President for his own voters. Most of us would visibly shrink from telling our faithful supporters an outright lie, while also demeaning their intelligence. However, as hard as it may be to stomach, the President is simply not being truthful.
Below is a chart that tells the actual story of which President has spent the most over the last decade:
Even if you try to take into account the meltdown of 2008, as anyone can see, the debt levels, along with the increase in debt, is undeniable in the years 2009 and 2010 from this US Treasury chart.
It is an unassailable fact that the US Government under Obama has racked up more debt in a mere four years than all Presidents combined in the history of the United States; it's simply that simple.
Okay, then, if that's true, why is it that we recently heard an argument stating that Obama has actually spent less than any other recent President?
Well, it was a misleading ploy that fell flat on its face when we saw how the data was being manipulated.
To understand, below is the chart of extreme misinformation, which cleverly plays with the actual numbers, in an effort at extreme Statist deceit, to a deafening uproar from those who know better. You see, the below chart only tells you of the percentage increase in spending over the prior year averaged out. Obama's first year as President automatically included the $ 800 billion stimulus. Therefore, each successive Obama year should show a hard decrease from 2009, right?
Wrong, is the answer.
Despite our $ 800 billion stimulus, Obama's spending level still shows an annualized increase in spending, when it should show a massive decrease.
So, initially, you might say, "Wow!" On a percentage basis tied to the previous year, they're right! Obama did spend less on a percentage of increase basis...however, the massive economic stimulus is the budgetary elephant in the room that allows this "percentage of increase lie" to proliferate, while also proving beyond the shadow of a doubt that the stimulus was not a one-time item.
You see, what they are also not telling you is how the budget is figured every year.
Under the baseline budgeting method currently in use by our government, and allow me to repeat this one more time, the supposed one-time stimulus act of 2009 totaling $ 831 billion has been criminally included in each successive budget year thereafter, and no, this is not a joke.
Therefore, any lessening of spending, by the officials in charge of spending, is simply chipping away at the bloated and wasting carcus that is our US budgetary spending level, which includes the 2009 stimulus in each successive year.
Still not clear?
Well, who can blame you. More visual evidence certainly couldn't hurt, since many individuals have trouble conceiving of these large dollar amounts.
Please check out the below chart which measures US spending outlays from year to year; if the stimulus is confirmed as not being there in successive years, we should see a drop of almost 1/3 rd of the total in each successive year's spending following 2009.
no matter
If you peer over to the right of the chart, kindly provided by the US Government, please note the federal outlays represented by the blue shading. Now, do you see the spike in 2009? That was the stimulus along with a number of outlays (2009 omnibus spending act) that even made 2009 worse, as far as the record spending levels go.
However, you will also note that the blue shading after 2009 drops minutely, but then progresses steadily upwards from 2011 onward.
Now, if you look to the extreme left of this same chart, you can see that the numbers we are dealing with represent a level of almost 4 trillion dollars in spending. That blue shading should regress starkly back downwards after 2009, and yet it doesn't, as you can plainly see. The stimulus layout of 2009 has, in fact, been included in each successive year thereafter.
But what about Obama and the Democrats' point about taxing the wealthy, and how they aren't paying their fair share?
Well, it's this particular bit of populist baiting that many euphemistically label as a Mobocracy at work. There are only a relative few extremely wealthy individuals in the US, and even in the world, for that matter. Do we, as the majority of middle class earners, have any sort of right to assert our superior numbers against those who have been very successful, due merely to their lesser in number?
Taken one step further, where do we draw the line with that bit of reasoning? If we discriminate against one group of individuals due to some arbitrarily assigned advantage or disadvantage, in this case wealth being their unfair advantage, who might be the next group targeted due only to their lesser numbers because something appears to be unfair?
In fact, history is replete with the dangers of this sort of behavior, which is one very powerful reason to be cautious of any who would seek to take such an advantage when in a position of leadership.
However, the "real truth," regarding the wealthy and taxes, speaks to the fact that the top 25% of all American earners, or "the wealthy," pay over 86% of America's income tax revenues, according to statistics provided by the IRS. This would mean that, of the total revenues currently being collected in the form of individual income taxes, which are at about $ 900 billion dollars per year, over $ 774 billion comes from those people "who are scolded for not paying their fair share." This also would, therefore, mean that all of the people Obama and the Democrats are attempting to rile up over the so called "wealthy" are only paying about $ 126 billion dollars per year in taxes, if any.
However, it gets even better from there.
In 2008, the bottom 50% of all taxpayers paid only 2.7 % of America's total tax bill, which means that, of the $900 Billion in revenues collected, the bottom half of all taxpayers paid only $24.3 billion dollars. Even better than that? Since 1980, the amount payable by the bottom 50% has been reduced steadily downward each year from a high of 7% to the current rate of 2.7%.
The question would, therefore, become, "could this progressively lessening taxcode be at the heart of America's true deficit reduction and spending problems?" An even better question would be, "why do the Liberals consistently center their arguments on the top end of the bracket when these so-called "wealthy individuals" are the ones who are quite obviously footing the bill for virtually everyone else?"
To illustrate the mistruths that the Left is trying to sell, in 2008, there were approximately 236,883 people who made at least $ 1 million or more. If we were to eliminate the Bush tax cut rates for these millionaires, the increase in revenue to the US government would initially total about $ 40 to to $50 billion more per year after adjustments for debt costs. With a US government that currently spends about $ 420 million per hour, we would easily spend this extra amount of taxation in only about a month or so.
Truthfully, there is no conceivable way that America can actually tax its way into balancing the budget, due simply to the fact that, to merely break even this budget year, officials would have to tax virtually every individual and corporate income taxpayer in America at double the current rates, and that still wouldn't be enough to break even ( $ 1.484 Trillion x 2 = $ 2 .97 Trillion) when we consider that America's government spent about $3.6 trillion in 2011.
All of this, then, leaves us only two viable options that will verifiably work together:
The first option being to massively and innovatingly slash our spending and outlays, and the second being to get government back out of the way, and allow the private sector to do what it does best, in the full and complete exercise of society's right to freely trade.
These are the engines that powered America into an industrialized powerhouse that the world would try to emulate.
However, there is that one other little regarded fact that never seems to see the light of day.
We have heard ad nauseum from the political Left ,over the past score of years, how healthcare costs in the United States are dragging America down and ruining our economy. These costs were what ostensibly resulted in a complete revamping of our health delivery system into the artificial restrictions of Obamacare. But in fact, the cost of America's healthcare system almost exactly rivals one other terribly expensive sector of our total economy.
In 2010, America's total expenditure for our "horridly expensive" healthcare was about $2.3 trillion dollars. However, and rather ironically, also in 2010, America's total expenditure to its Federal government was about $ 2.38 trillion hard-earned American tax dollars.
And yet, where are the calls for a "complete remake" of our terribly expensive government system, especially from those who insisted on essentially nationalizing our healthcare due to its extreme costs? How is it that Healthcare has been crippling our economy while our even more expensive Federal government, has somehow not?
Maybe it's high time that America itself, gets a tax holiday of sorts, especially since our ideologically intrepid President's every other effort has failed beyond miserably in getting our economy moving.
The Political Left and their extreme demagoguery, along with their insidious attempts at promoting disingenuous class warfare, have been taken to a whole new level, it would seem, especially when these Statists fail to enumerate even these most simplest of truths:
The more one considers the matter, the clearer it becomes that redistribution is in effect far less a redistribution of free income from the richer to the poorer, as we imagined, than a redistribution of power from the individual to the State~Bertrand de Jouvenel