Sunday, April 24, 2011

Magic Bullets part VIII - The Oxygen Standard

We seem to have reached a stalemate in Washington trying to get a handle on our out-of-control deficits. Is it possible there is a simple way to deal with this and finally find out what our politicians are made of?

I propose we put our government on the “Oxygen Standard”. The Oxygen Standard is similar to the Gold Standard in that dollars are converted into a set quantity of oxygen, only in this case, the dollars are our government deficits or surpluses, and the oxygen is for our government officials to breathe.

Here’s how the Oxygen Standard would work: First, all three branches of government (yes, the court too!) would be housed in airtight chambers which would be locked-down during budget negotiations. If the resulting negotiations yielded a balanced budget, there would be exactly enough oxygen pumped in to balance the breathing needs of all the members. However, if there is a deficit, the same ratio will be reflected in an oxygen deficit being pumped in. Of course, if there is a surplus, extra oxygen will be supplied which would result in a “strategic oxygen reserve” which could be drawn down in times of war or natural disaster.

To make the Oxygen Standard even more real, there will be an additional way government can “tweak” the supply of oxygen during deficits. They could draw down the oxygen supply of future generations by allocating the needs of infants and the unborn for their own breathing consumption. Mass suffocations would eventually result, but government officials could at least spend away and breathe easier.

Any guesses as to how this would play out?

Wednesday, April 20, 2011

The Irony of Keynes

Welcome YouTubers!  Scroll down for more blogtoons and commentary.  But if you are inclined towards heavier fare, pls try this post:  The Irony of Keynes
Thanks for visiting!

Thursday, April 7, 2011

GE is Right!

You may have seen that GE, despite having a massively profitable year, will pay zero federal income taxes for 2010.  That’s right, less than you!  And this is the second year in a row.  I have no love for GE and its hearty embrace of crony capitalism, but they are doing the right thing by not paying any taxes. How can I say this? Because I believe no business entity should pay taxes, and that includes behemoth GE.

Let me ask you a question: How many people do you think would die of cancer each year if all cancer cells could be somehow trained to start growing on the tip of your nose? Every morning the first thing you would do is look in the mirror and see if you had any cancer. If you saw something, you would immediately have it removed. That would be the end of cancer, right?

The price of runaway government today is like cancer in that it hides undetected until the symptoms begin. By then, it’s often too late. If every citizen woke up every morning and could see the true cost of runaway government on the tips of their noses, they would never allow it to metastasize, and that would be its ultimate demise.

Business taxes are a good example of this disease. The fact is, businesses don’t actually pay taxes. Citizens do. Businesses merely collect taxes and pass the cost along to the next entity in the supply chain until an ultimate “end-user” buys the product and pays the cumulative tax. Economically literate politicians, (an oxymoron) know this full well, but will never end stealth taxes unless forced to because they are a perfect way to ensure that the cancer they caused stays undetected.

Right now in Washington there is an epic battle going on over budgets for this year and next and it makes for great drama on the nightly news.  But this tragic play will repeat ad infinitum as long as we allow the true cost of runaway government to stay undetected. Have you seen Paul Ryan and the few other responsible leaders working their tails off trying to treat this cancer? They remind me of lonely sentries on the deck of the Titanic yelling, “ICEBERG! ICEBERG!” to the sleeping passengers and crew. The masses are not listening and the ship is sinking. It’s a noble crusade Rep. Ryan is on, but there may be a more effective way.

Wouldn’t it be better if we just stopped hiding the cost of government and put it all in the open for everyone to see? Wouldn’t it be easier if the interests of voters and taxpayers were automatically aligned with the interests of the responsible members of government? Wouldn’t that be better than trying to convince an indifferent public to somehow care? Why not just pass a law to end stealth taxes once and for all? Why not put an end to business entity taxes, payroll matching taxes, mandates that force businesses to do the collecting, and any chance of a VAT ever getting passed?

All it would take is an itsy bitsy constitutional amendment with one sentence:  “All domestic revenues shall be collected directly from individuals.”

The effect of this would of course be higher tax rates on individuals, but the price of goods and services would go down by an equal amount. The net effect overall would be zero. This amendment would cost you nothing.

Would this cure the cancer? Let’s just say you’d be staring the true cost of the runaway government in the face everyday. Would you tolerate it metastasizing? Wouldn’t this amendment be worth working for, and at least campaiging on?  Pass this on to the candidate of your choice if you think so. 

Oh, and one other thing; small companies like maybe even yours, would have the exact same advantage that giant GE has today when filing taxes!

Friday, April 1, 2011