Saturday, March 2, 2013

Some lessons from the 2012 Election

Almost everyone realizes that big money influences politics today.

Politicians need votes to get elected, and they need money to reach
out to the voters.

Special interest groups need access to politicians in order to push 
their private agendas onto the general public...and are more than
willing to offer money or bloc votes to gain that special access.

It can be a marriage made in Heaven, as it was when it helped
correct the days of child labor, unfettered pollution, and other
human, ethical, and environmental problems. 

It can be a marriage made in Hell, when it is used to prevent the 
correction of injustices, or when it continues to push further and
further beyond a solution of fairness and common sense on problems
that have already been solved.

The problem today is that most Federal politicians are so wedded
to the special interest money that they spend scant, if any, time
worrying about Constitutional limitations, State's rights, or individual
rights and liberties, or the fiscal impact of their promises.

Republicans and Democrats alike spend the majority of their time
raising campaign money by promising tax or regulatory breaks for
their favorite constituencies, while playing lip service to the
"middle-class American", who continues to get shafted.

The career Republicans and Democrats both know that their key to
remaining in power is to use the tax system as a tool to fund the
promises they make to their supporters, or as a method to threaten
their detractors.  They are virtuosos at playing the existing system to
their benefit.

But now, this system of tax increases and increasing exemptions
has expanded and expanded so much over so many years, it has
become bloated and unmanageable.  It is close to burying the nation
in debt.

Who pays for all this?  You do, if you work for a living.  The 
Federal  Government alone withholds income taxes, social security
taxes, and medicare taxes out of your pay stub, as well as
additional social security taxes from your employer for you.

And if they don't take enough money from you to pay for the 
promises they make, they'll go ahead and borrow the money, so
you, or your children, will be paying it back later.

You may think you're making out on this deal.  You're a union
member and you've got political friends who are covering for you.
Or, you're a Wall-Street banker, or, a farmer.  Maybe you're a
manufacturer, or a small businessman.  You might be interested
in protecting the environment.  You could be in the one percent,
or in the ninety nine percent, or in the middle-class.




If you're in any of these groups, or any other group, you may 
think the politicians are looking out for you.  True, they're giving
your group something.  They're also promising all the other
groups something...and they're taking all of it out of your pocket.

If you work for a living, your family is paying for the promises
they make.  It doesn't matter if you earn $20,000 a year or
$2,000,000 a year...you are paying for it.  You are the individual
working person, and you are paying for ALL the special interest
groups the politicians are favoring.

So, the first lesson learned is to start thinking of yourself as an
individual who is paying for all the special interest groups, and
start demanding that politicians justify how they are spending
your money and where it is going.

Use your influence to support candidates that promise to 
support a simpler tax plan with lower tax rates and fewer 
deductions.  My preference would be a plan similar to that
described in my "Tax Overview" and "Five Ten Begin Again"
posts.

With any plan, the general idea should be to simplify the tax
code and prevent politicians from using the code to reward
or penalize individuals and/or organizations, and to force
them (the politicians) to live within a budget, just like the rest
of us do.

Even if you think that tinkering with the tax code was justified
in the past, it has gotten so bloated and inefficient that it has to
be reset before we implode in the future.

If you work for a living, you're being played, one against another.
In order to distract you from asking why anyone who earns less
than $20,000 should pay any federal income tax, or why anyone
at all should pay almost a 40% tax rate, they have you arguing over
which rich guy should pay more than you or which special interest
group should get a special tax break.

The question should be "Why should politicians take so much 
money from my family, and give so much of it to other people?".
Even the Social Security Trust Fund is used as a piggy bank to fund
government spending through special issue treasury bonds at low
interest rates.

A simpler, fairer tax code at lower rates would help impose fiscal
discipline in Washington, would help discourage social tinkering and
political cronyism, and would help prevent politicians from using
the threat of tax consequences to extort political contributions and/or
to silence political opposition.   
   

        

   
    





  

   









   

 
    

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