Why we lose our property

One of the most sacrosanct beliefs in a libertarian society is the free right to own property. In the most fundamental sense, this property includes personal possessions such as land, homes, automobiles, and other sundry valuables accumulated over time by an individual or family unit.  In almost in all cases, this private property is obtained from the fruits of ones’ labor; from participation in free market transactions whether from traditional manufacturing – selling of products, by delivering services and expert advice to someone willing to freely purchase them, or even by speculatively investing where one’s original investment is smaller than the final price obtained when the investment is sold.

How much fruit one obtains in a free society is often distributed unequally within the society and is dependent on a multitude of factors including hard work, skill, education, knowledge, experience, and even plain luck.

For some reason, statists despise the inequality of free markets and the fact that someone can be very successful and accumulate significant wealth by conducting free market commence.  To combat this undesirable feature of a capitalist society,  statists have created two large classes of the populace who can be ‘fed’ via the taxation or theft from all wage earners, even those who work within the statist system.  (Very strange, they give money to someone who works for the state and then tax them to pay for their and other government employees’ wages)

The first class to receive the benefits of redistribution of wealth are government employees. Now mind you, many of these employees provide value to society but given their relegation to being employed by the state instead of the private sector they become a protected class that must be supported by the forcible confiscation of wealth (fruits of one’s labor) from workers.

According to the census bureau’s Government Employment and Payroll measure, the number of federal, state, and local civilian government employees and their gross monthly payroll for March of the survey year can be found at. Survey of Public Employment and Payroll website >>

The number within this class is large and as of March of 2015, there are 14,425,359 people drawing wages via the forced taxation of private property.

The other class of people are those who are made dependent on the state for some portion of their existence.  These people receive the fruits of someone’s labor via programs like:

  • Medicaid
  • Supplemental Nutrition Assistance Program (SNAP)
  • Housing Assistance
  • Supplemental Security Income (SSI)
  • Temporary Assistance for Needy Families (TANF)
  • General Assistance (GA)

“Approximately 52.2 million (or 21.3 percent) people in the U.S. participated in major means-tested government assistance programs each month in 2012, according to a U.S. Census Bureau report. “

One final thought to ponder. Do you think these two protected classes (Government employees and people receiving means tested benefits) will ever support changes to our statist system?

 

 

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Basic economic laws should not be thwarted

In the United States of America, the state continues to deploy failed policies that violate basic economic principles to the detriment of the entire society it seeks to control.   This failure can be seen in America’s Welfare State and progressive income tax program. The former subsidizes individual actions and life styles that can contribute to poverty and the later discourages income and wealth generation. Simply put, basic praxeology shows us when you subsidize something you will get more of it. Tax and regulate something you get less of it.

Since the amalgamation of the Revenue Act of 1916 and FDR’s New Deal, (in which the state used taxation, targeted subsidization, and regulation in an attempt to alleviate and or mitigate its definition of poverty among its citizens), the state began to extremely violate the aforementioned basic principles of human behavior.

In FDR’s “First New Deal” (1933–34), many programs were instituted using state subsidies to pay people who did not work and create new regulations for the banking and industrial sector which increased their moral hazard in an attempt to combat the impact and causes of the Great Depression.

FDR’s “Second New Deal” (1935–38) went further and fully institutionalized state involvement in the nation’s personal behavior in an attempt to address the effects of the ongoing economic crisis.  Programs such as Social Security and the Fair Labor Standards Act would change America forever.

The state, in its infinite wisdom, seeing less than satisfactory results from FDR’s New Deal, thirty years later further increased its involvement in Americans’ personal lives with new programs, subsidies, and taxes during LBJ’s Great Society.

Our aim is not only to relieve the symptom of poverty, but to cure it and, above all, to prevent it. No single piece of legislation, however, is going to suffice.”
– President Lyndon Johnson, 1964 State of the Union Address

Recently, according to the 2014 House Budget Committee Report, The War on Poverty: 50 Years Later the state’s return on investment has been less than satisfactory.  Below are some conclusions from the report showing failure of the state to eliminate poverty by not understanding basic human behavior:

The War on Poverty at a Glance
Despite trillions of dollars in spending, poverty is widespread:
• In 1965, the poverty rate was 17.3 percent. In 2012, it was 15 percent.
• Over the past three years, “deep poverty” has reached its highest level on record.
• About 21.8 percent of children live below the poverty line.1
In can be no surprise the state has failed to eliminate poverty if one understands the basics tenets of human behavior and the fundamental principles of economics.   The state’s policy violates them. Government programs targeted at poverty reduction/elimination encourage more poverty by encouraging a person to continue their current situation of being in poverty — receive payments and subsidies for having lower income, receive payments and subsidies for not working, receive payments and subsidies for having more dependents, receive payments and subsides for not completing high school, receive payments and subsides for not living a healthy lifestyle, etcetera.
The state also discourages work and thus wealth generation with its onerous job killing regulations which make it more costly for employers and entrepreneurs to create jobs and thus new wealth.
Additionally, the progressive tax system reduces the incentive to generate new wealth as its marginal income tax rates and capital gains taxes punish those who generate more earned income and investment generated wealth.
The state could easily rectify the current situation by eliminating all subsidies to individuals and corporations and stop taxing income and wealth.
1. “War on Poverty.” Http://budget.house.gov/uploadedfiles/war_on_poverty.pdf. United States House of Representatives , 3 Mar. 2014. Web. 8 Apr. 2017.

War on Poverty has failed

There is a very good article by Arthur Brooks of the American Enterprise Institute titled The dignity deficit: Reclaiming Americans’ sense of purpose.  The piece speaks of the improbable Trump victory and postulates the win came about because of the anger of those citizens left behind economically in America.  This thesis explaining Trump’s win is not unique, many political pundits have offered the same.  However, Brooks extends the story by going back to LBJ’s War on Poverty. Brooks highlights in his article the plight of a poor Kentuckian named Tom Fletcher. Fletcher, despite government assistance (welfare) is never was able to escape poverty.

In 1966, when the War on Poverty programs were finally up and running, the national poverty rate stood at 14.7 percent. By 2014, it stood at 14.8 percent. In other words, the United States had spent trillions of dollars but seen no reduction in the poverty rate.1

There are millions more Tom Fletchers that Twenty trillion dollars of government largess has not helped and they voted in November, 2016.

The solution to poverty is to go back to fundamental economic principles. If you want more of something, then do not tax it. However, this axiom is ignored by statists and we have many Americans being left behind. The solution is simple, stop taxing the fruits of labor (wealth) and you will see more fruit.

The same principle holds true for government regulations that stifle labor and subsequent wealth generation. If you you want less friction on labor which will lead to more wealth creation, stop unnecessary regulation of the actions that generate wealth.

  1. Brooks, Arthur C. “The Dignity Deficit: Reclaiming Americans’ Sense of Purpose.” American Enterprise Institute. Foreign Affairs, 13 Feb. 2017. Web. 09 Mar. 2017.

Wake up America

Americans need to wake up and realize that our rights are being taken away by a corrupt government.  President Obama assured us years back that his administration would respect the US Constitution but today we find out that the CIA has tools that violate our privacy and we would never know it. (See WikiLeaks Vault 7)

Senator Obama promised in a Woodrow Wilson International Center, Council on Foreign Relations speech on August 1, 2007 that:

His administration would not “spy on citizens who are not suspected of a crime, ”

“I will provide our intelligence and law enforcement agencies with the tools they need to track and take out the terrorists without undermining our Constitution and our freedom.

“That means no more illegal wiretapping of American citizens. No more national security letters to spy on citizens who are not suspected of a crime. No more tracking citizens who do nothing more than protest a misguided war. No more ignoring the law when it is inconvenient. That is not who we are.

Obama also declared that “the law is not subject to the whims of stubborn rulers”:

“We will again set an example for the world that the law is not subject to the whims of stubborn rulers, and that justice is not arbitrary.”1

We Americans must all rise up and tell our government to stop and then only elect candidates who respect the law.

  1. Parks, Bob. “Obama’s 2007 Promise: ‘No More Illegal Wiretapping of American Citizens'” CNS News. N.p., 10 June 2013. Web. 07 Mar. 2017.

Conversation with a statist

A few days ago, I was involved in a conversation with a leftist supporter of the Federal government’s venerable Social Security program. My position was the program is a Ponzi scheme and for all intents and purposes, it is insolvent.

The person I was speaking to, an ill-informed statist, was aghast that someone would question our Federal Government!

To be more specific about my concern, I went to paraphrase the Social Security Trustee report stating that even its caretakers know the program is failing as evidenced below.

“Social Security’s total income is projected to exceed its total cost through 2019, as it has since 1982. The 2015 surplus of total income relative to cost was $23 billion. However, when interest income is excluded, Social Security’s cost is projected to exceed its non-interest income throughout the projection period, as it has since 2010. The Trustees project that this annual non-interest deficit will average about $69 billion between 2016 and 2019. It will then rise steeply as income growth slows to its sustainable trend rate as the economic recovery is complete while the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers.

After 2019, interest income and redemption of trust fund asset reserves from the General Fund of the Treasury will provide the resources needed to offset Social Security’s annual deficits until 2034, when the reserves will be depleted. Thereafter, scheduled tax income is projected to be sufficient to pay about three-quarters of scheduled benefits through the end of the projection period in 2090. The ratio of reserves to one year’s projected cost (the combined trust fund ratio) peaked in 2008, declined through 2015, and is expected to decline steadily until the trust funds are depleted in 2034″.1

To close my conversation, I put the statist on the spot by promoting privatization and further pondering just how much worse could we, as individual citizens, do in planning for our own retirement than is currently being done by the Federal Government?

As no surprise, the statist could not respond.

  1. A SUMMARY OF THE 2016 ANNUAL REPORTS. Rep. Social Security and Medicare Boards of Trustees, 22 June 2016. Web. 11 Feb. 2017.

Is the 5th Amendment no longer valid?

In reading this article, one can see the state taking a very casual view of the rights guaranteed by the 5th and 7th Amendments to the U.S. Constitution. Under the guise of system efficiency, the statists have usurped peoples’ rights to due process and trial by jury.  This circumstance of power grab by the administrative law judges (ALJs) distills down to Lord Acton’s Power Corrupts adage.

Please read, How Government Agencies Usurp Our Rights — The federal bureaucracy increasingly acts as prosecutor, judge, and jury by Philip Hamburger and tell me if I am wrong.

Find the piece at: How Government Agencies Usurp Our Rights – The federal bureaucracy increasingly acts as prosecutor, judge, and jury.

 

Government and food

The following graphic clearly shows how entrenched the state is in everyday life.1  They currently provide some level of sustenance to over 43 million people. How much more can the state become involved in Americans’ life; this is food, an essential for the maintenance of human life, that is being doled out by the Federal Government to its subjects.

The growth of the number of Americans participating in SNAP has risen significantly since the ‘so-called end’ of the Great Recession. This is preposterous and violates common economic principles.

A few simple questions come to mind as one tries to understand the need for growth in this behemoth, $70B, state sponsored program in non-recessionary times.2

Question 1: If the Great Recession has ended, why did the SNAP program continue to grow?

Question 2: If the answer to question number one is that the Great Recession is not over is the Federal Government lying to the American people about the condition of the economy?

Question 3: If the Great Recession has ended as the Federal Government has stipulated, is the growth in SNAP due to the statists’ desire to create dependence and thus control over its citizens?

As in the case of most issues, the truth is likely found in the middle ground.  The Federal Government’s economic numbers are often fraudulent or at a minimum, do not reflect reality. Additionally, the state must force dependency upon its citizens to continue to survive.  Simply put, the economic conditions in American are not all that great as they are purported to be and the state, in order to grow its control over its citizens, wants more people dependent upon the state such that they will be forced to choose the state over economic freedom and personal liberty.

Sources

  1. “Food-Stamp Recipients Can Now Order From Amazon, Other Online Retailers.” Zero Hedge. Judicial Watch, 16 Jan. 2017. Web. 16 Jan. 2017.
  2. United States Department of Agriculture Office of Inspector General. “3.10. Administrative Costs.” (n.d.): n. page. US Department of Agriculture. United States Government, Sept. 2016. Web. 16 Jan. 2017.