Tuesday, August 4, 2009

Economics for people unqualified to be a dummy

I've been busy in the local newsrag discussing the merits of the stimulus.It simply amazes me how few people understand even basic economic concepts.I can see how being clouded by their love affair with Obama would affect their judgment.But wouldn't you think that at some point even the most jaded would have a glimmer of common sense?

I believe it comes down to one simple question to ponder.Who do you want to control your income?High taxation puts the control in the hands of the Government.Low taxation gives it to you.It really is that simple.

Let's compare the two thru the path of a dollar.When I spend a dollar at a store,I usually pay a sales tax.The storekeeper gets the dollar and pays their distributor for their goods.They then pay the manufacturer or grower or something along those lines depending on what good or service we are talking about.At every step of the way,taxes are collected thru various means to it's conclusion in the process of delivering a good or service to a consumer.

The alternative is high taxation in which the Government takes it off the top and is then charged with it's redistribution thru the vast myriad of spending and entitlement programs.You have succeeded in bypassing all of the steps in-between where different companies make profits and also pay taxes.The consumer has less buying power and their standard of living is lower.

One path allows the consumer to acquire goods or services and various companies to succeed and profit allowing increased employment.The high taxation route eliminates that.Seems like an obvious choice except that the X factor is power and the Government demands it so that they make the decisions on where the money goes.

In short,when we control our money,the Government has less power.What the Liberals don't seem to grasp is that the Government will still receive the same tax revenue at the end of the day.When you reduce tax rates,tax revenue actually increases.This has been proven throughout history.Reagan proved it.The failure was in reining in Government spending from those increased revenues.

Any stimulus program or bailout or other entitlement program run by the Government costs the taxpayers money.No debate here.The Government has no money.Zero.Their funding is mainly thru taxation.Or printing money.Or selling debt.Whatever it is,it all costs us money.

Why does this not make it clear to any rational thinking person?Cutting taxes to put money in the consumers hands which they will then utilize to start the chain of profits and taxes collected results in increased Government revenue because of total tax receipts even at a lower rate.Deficit spending thru stimulus and bailouts does the opposite and thus is doomed to fail right from the start.Yes,you may see a small short term bump like we are experiencing now but the no free lunch rule applies and the bill we must eventually pay destroys the recovery.

It's obvious which path our politicians prefer as they want to have the power and control.But why do so few voters see these simple concepts?This is the challenge for clear thinkers,to educate the unwashed.More to come...

1 comment:

marry said...

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