Posts Tagged ‘Congress’

Had I stayed away from the news websites, I wouldn’t have even noticed the federal government shutdown. Funny part about that is that I have a family member who works for the federal government, but she didn’t get furloughed since she works in a government agency that actually turns a profit with its services. Naturally, when an organization makes a profit it doesn’t have to furlough people when the rest of the federal government does.

I’m not going to debate whether one side is right or wrong or worse than the other in this blog. I’m just going to post a solution to the one problem that I saw most in the news and on social media: shutting down our national parks. I’m not going to debate if a 1000 square mile range of the ocean in Florida needs our federal government to stay open to fishermen or whether Mt. Rushmore needs federal employees to be open. This solution solves the debate. Here it is…

Have the National Park service issue multiple denomination certificates for the full amount of its annual budget that are a tax credit for those who purchase them and never have to be paid back. In essence, it’s a donation to our National Parks, but rather than just being a tax deduction like a charity, this is a tax credit because our federal government is using tax dollars to pay for the National Parks. It’s a $ for $ in tax money.

Obviously, the National Park service would incur some minor overhead for building and maintaining this system, so it can just add it to its budget. I’m betting that if you put it into an open bidding process you could easily find thousands of companies capable of building this platform.

This would help ensure that our National Parks remain open regardless of federal government wrangling. It would also serve as a model for other government entities for how they can become self sufficient and immune to federal government budgetary gridlock. There are numerous other benefits to this model such as helping to keep spending inline with revenue for the government as a whole and providing citizens with a greater say in how our tax dollars are spent. This idea isn’t just about avoiding shutdown furloughs that are back paid anyway. It’s a solution to an ongoing budget (or lack thereof) with our federal government.

Here are added incentives for our National Parks:

  1. Want that budget increase you could never get? Increase your budget and see if taxpayers are willing to pay for it
  2. If Congress acts now, there will be a flood of taxpayers willing to cover your entire fiscal calendar budget since there are just 2.5 months left in the tax year

Edit: Why not make a petition out of it? https://petitions.whitehouse.gov/petition/taxpayer-direct-funding-national-parks/csP0c6Bh

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I hear the cries of the supposed 99% (OCCUPY) folks. I’m in the 53%, the group of Americans that pays Federal and State income taxes. On top of that (like many Americans), I pay property taxes, gasoline taxes, sales taxes, and countless other government fees (including those 9/11 security fees on plane tickets). There are taxes upon taxes that I’m paying… and more taxes on top of all that.

While I think we should be on a bond-only system for funding our government programs, there’s an interim solution to getting there. One that wouldn’t be so radical: opt-out taxes. I’m not talking about being able to opt-out of Federal income taxes like my friend Jimbosway is likely to support. I’m talking about giving tax payers the right to opt-out of funding Federal programs with their tax dollars.

Where The Money Goes

This doesn’t mean you get a tax refund right away and the government losses all it’s money because nobody is going to want to fund any program. It just means that your tax dollars don’t get spent on something you don’t want them spent on. For example, if someone wants to not fund farm subsides for sugar in Florida, they opt-out of that program. If someone doesn’t want to fund NPR, opt-out. Etcetera.

We could even take it a step further and allow someone to change their funding from say sugar subsides to NASA, so NASA would have additional funding. You’d have to lock in your choices for a year at a time. This way, each program will know what it’s budget is for the coming year.

Now, what happens to the opt-out money? Well, let’s just face it. That’s a problem we’re not going to have to worry about for another $1+ trillion dollars. However, eventually, there could be a budget surplus as government programs are defunded. There’s nothing wrong with a government surplus. When that happens, and if it runs surplus long enough then the government will know how much money each taxpayer should receive back. That’s pretty simple and fair.

Accountability

This will also put a tremendous amount of accountability onto the shoulders of US (that’s an emphasized us, not United States – well, United States citizens…) If we don’t want to support programs like TARP and bailout programs, we don’t fund them. Now, people will say things like: TARP was an emergency. We couldn’t wait a year to get that funding. I’ll just laugh at that argument. Unless you were John McCain, you saw it coming!

Transparency

Another HUGE benefit of this is that it would give us massive government transparency. Rather than transparency being a punchline in an Obama speech, it becomes a reality! We’ll know what programs are receiving how much funding, and more importantly we’ll know what the hell the programs are! If someone is spending your hard earned money, don’t you think you should know where it’s spent? It’s not like the government agencies need to send us postcards or pictures of the kids we’re helping like a charity does. But we will at least know that our money isn’t going to fund a program that we don’t support.

Technology has advanced significantly over the last few decades. Yet, our political system and taxes are way behind on utilizing technology to better themselves. We can create and easily maintain massive databases that would house this information and allow our budgeting to be based upon democratic taxation.

Other Ways the Government Can Still Steal Our Money

And Congress members who love to spend money like it’s going out of style need not fret. They can still work on pork belly programs! Pass whatever spending they want with the existing methods they now have. Fund it just like they do now. If we the people decide to provide them with the funding, the program can continue on. If we don’t, the program dies.

Congress could also go about imposing “fees” instead of using income tax dollars. Just look at your cell phone bills or airplane tickets to see examples of those. They could go about imposing other use taxes (perhaps a national sales tax, since they’re already talking about it anyway).

None of these worry me because if we did have an opt-out system in place and Congress did try to go about stealing more money from our pockets, we’d be more educated about what is going on with our government on a greater scale than we do know. We’d have a much greater vested interest in where our money is being spent/wasted. The second Congress tried to implement a national sales tax or additional fees, we’d put a stop to it.

More Accountability

I also think that our greater involvement with the spending of our taxes dollars would turn the tables on today’s political thinking. Right now, Congress can just go pass any spending bill they want without much accountability to their constituents. With an opt-out system in place, Congress is going to have to go back to the people they serve and ask them to support their decisions. Congress is going to have to explain why they’re voting yes on spending more money. Opt-out make Congress accountable to the people they serve!

It seems like everyone and their mother received money from the Federal Reserve in 2008. My dogs didn’t get any from The Fed, but my cat certainly did! The dogs aren’t too happy about it.

All joking aside, the lending to Verizon, Harley-Davidson, and countless foreign banks really helped prevent a “financial meltdown” and “Some have recorded healthy profits for taxpayers”… Oh wait! I said all joking aside. First, I don’t see how returns to The Fed benefit taxpayers in any way. Second, I don’t see how getting paid back money with interest when the USD has been devalued so significantly over the last two years is actually making a profit.

If I lend someone $10 and they pay me back $12 in two years but $12 is really only worth the equivalent to $9.60, I really didn’t make a profit. That’s what The Fed did on the scale of $9 trillion.

The logic of all this “stimulus” and “bailout” is flawed. The idea is that companies, banks, etc are “too big to fail”. The biggest problem with this logic is that a company reorganizing its debt is not a failure. Sometimes this happens. I’m not talking about completely cooked books like Enron and companies like that. Bankruptcy protection allows a company to sit down with the folks it owes money to and say that instead of going through expensive collections processes and incurring massive attorney fees for our 3 year loan, we’ll pay it back in 5 years instead. That’s just one overly simplified example, but pretty much how it works.

There is no company that is “too big to fail”. Unless there is egregious cooking of the books, the company can always be salvaged and work out deals with its creditors to solve the financial issues. The Fed just printed money and handed it out to people. So what if the money was paid back! The value of the USD has decreased so rapidly over the last 2 years that the money paid back is worth far less in terms of tangible value than it was when it was lent out.

The result of the $9 trillion money printing job is this stalled out economy. Rather than forcing businessmen to grow come cojones and take responsibility for their businesses, Bernanke dished out trillions because he read in a textbook that the idea would work. I’m sure in his mind it has worked because the alternative was a “financial meltdown” (which is patently false). I’m sure Congress and Obama won’t do anything about his reckless action.

Obama is talking a talk that sounds great on the surface but can ultimately lead to a massive loss of jobs in America rather than creating jobs. Bernanke is helping to speed along this economically devastating Administrative policy with equally rash monetary policy. I understand where Obama is coming from. He wants to create jobs in America. The thinking by the Fed is that by the Fed devaluing the USD (US Dollar), American goods will become more affordable to China and other nations. Sounds great! On paper…

However, it is a clear indication that Obama and Bernanke don’t understand the United States’ position in the world economy. An import economy does create jobs, contrary to what the Obama Administration makes it sound like. Yes, manufacturing jobs have been lost in America. However, importing still creates jobs. A lot of jobs for that matter, and higher paying jobs! The major key to being a strong importing nation is having a strong currency. The stronger the USD, the greater the ability to import products from other countries.

The Federal Reserve, under Bernanke, has weakened the USD significantly over the least several years. The Obama administration is trying to create more manufacturing jobs in America on the backs of the import industry. Yes, import jobs will be lost as the USD continues to decline, but the result isn’t going to be layoffs, it’s going to be import businesses going bankrupt.

Now, this isn’t a too big to fail claim about the import industry. This is a claim that America doesn’t have the ability to produce all the same products that China does. What has taken decades to build in China is not going to happen overnight in America. Additionally, the typical Chinese worker makes a fraction of what an American worker would make for the same product. So, either American’s are going to have to take lower paying jobs or the cost of products are going to skyrocket!

Some argue that China is manipulating the RMB (Renminbi/Yuan) so that it’s export business continues to thrive at the detriment of America. There may be some validity to the claim the claim of currency manipulation, but it isn’t much unlike Bernanke’s QE and QE2, which are just fancy terms for devaluing the dollar. That is what Bernanke has done. He was devalued the USD. You can call it Quantitative Easing all you want, but a rose by any other name…

There is a large trade deficit between America and China, but it’s not across the board. For instance, where are Chinese airliners getting their planes? Where are they getting their MRI equipment? The advanced technology comes from America. A weaker dollar will lead to lower real profits by Boeing, GE, and other leading American businesses. Here’s the reality of a weaker dollar. So what if your widget sells for $500 when that $500 is only the equivalent to $300 from just 10 years ago!

A weak currency policy is a terrible monetary policy for America. An Administrative policy supporting exports is a good one when the focus is on exports that those other countries can’t make. Is the US really going to compete with the Chinese with making knock off MP3 players and cell phones that get thrown away every 2 years? Those will only be high paying jobs because the value of the USD will have declined to much to make America competitive with China that we’ll have gotten to the status of a 3rd world economy.

I’m being dramatic for a reason. The world economy has been centered on a strong America and strong USD for decades. The result of a devalued USD and trade restrictions with countries we’ve been importing from for decades is not what anyone in America is going to want. Enormous amounts of wealth has made its way to other nations like China, Mexico, and others. Those countries are seeing improvements in their quality of life. The US should continue to lead the world economy with a strong USD position and strong import position. The whole idea behind imports and exports is that countries export what they do/make best and import what other countries do/make best. The US still does and makes many products, services, and technology better than any other country.

The Solution: The Obama Administration should focus on leading technology industries (instead of rehashing dying industries in America) and creating greater tax incentives to grow those industries (just like Clinton did with the Internet)! Congress should act as well to impeach Bernanke. It is fully within the power of Congress to do so. Further, the Obama Administration can take action in the Treasury Department by not selling bonds to The Federal Reserve. These actions would send a sound message to the world economy that the United States is standing for a strong USD, strong US consumption, and leading the world economy out of this depression with swift action. These actions would take about 9 months to catapult the US economy and world economy out of this depression. The message to the rest of the world is that America wants to continue to *lead* the global economy rather than play a reactive role in the global economy.

Here’s an idea for the government bailout program that the vast majority of Americans don’t support. Give us an opt out clause on our taxes for the next 10 years.

Now, I’m not talking about opting out of our taxes. Those of us who don’t support the bailout will still have to pay our taxes as usual. However, we can opt out of our tax dollars being used to fund this ridiculous scam.

If you limit the government’s availability of funds, they can’t be as spendthrift as they have been. If they want to come up with $700 billion to spend on some useless bailout, they will need to get it from some other source than the American taxpayer.

Years ago, this would not have been possible. However, with technology today, this is entirely possible. In fact, we could give taxpayers the ability to opt out of any irresponsible government spending. It would really make it simple for the government to determine how much they can waste on pointless bailouts like the automobile industry bailout. If 60% of Americans don’t support the automobile bailout then they will only have access to 40% of the taxpayer funds.

This would make budgeting for the government much easier! Taxpayers don’t support something, Congress can’t just go spend the money whenever and wherever they want. I suspect that we could balance the budget within 4-5 years and keep it balanced indefinitely with a bailout opt out clause. In fact, I suspect the government would end up with considerable surpluses as government waste would now have a true checks and balance system in place. The total tax dollars collected would be the same, but the ability for Congress to spend would drop considerably.

Now, some might argue that this would create serious problems with because the funding for the bailout is something that is “necessary” to avoid a greater economic downturn or because it is something the public doesn’t understand the importance of. I have two words December 2007.

I keep hearing about how the Bush Administration and Congress don’t want the auto industry to fail. They don’t want the banking industry to fail. Yet most entrepreneurs will tell you that they’ve learned more from when they failed than when they succeeded. I’m betting that banks would learn more from failing than from getting bailed out.

There is something humbling about failure. There are so many lessons that come with failure. Perhaps the biggest is that we can recover. We can rebuild. We have it within our capacity to go beyond what we have failed at. That is the biggest life lesson we can ever learn, and I think it would behoove our Congress and President to let some of these businesses learn these valuable lessons.

I’ll admit that I don’t know much about Sheila Blair (chair of the FDIC), but at least she is coming up with ideas that actually make economic sense! Paulson on the other hand has already spent 1/3 of the $700 billion dollars he charged on the National American Express, and believe me when I say that we aren’t going to see any benefit from that money and are likely not even going to get any of it back. Now, Paulson is talking about buying stock in banks, which is just the most ridiculous idea to ever come out of the building next to the White House. Granted, Paulson is going to be gone in January anyway, but his plans to spend the “bailout” funds like there’s no tomorrow really need to stop. W could certainly redeem himself a little by asking Paulson to resign or firing him if Paulson doesn’t resign.

There are plenty of things to be passionate about. Firing people is usually not something that I am passionate about. However, when there is someone whose ideas are so detrimental to the stability of the American economy, we need to get rid of him. If you’ve been buried under a rock, Henry Paulson is the communist Treasury Secretary who was calling for the bank “bailout” months ago. Unfortunately, he got what he wanted. After having fumbled the ball on US economic policy so far, our Congress somehow believed him that we needed this.

Now, his team has come up with the most absurd idea in the history of idiotic economic ideas: purchase stock in banks to help their balance sheets. Where does he come up with such idiotic ideas!?! While buying up bad debt from failed loans would certainly create a mess, this communistic thinking is the most absurd idea I’ve ever heard! What will happen *when* (not if) the stock goes down? Who really reaps the reward of the US government going in a buying stock? The investors. The banks are not going to benefit at all because investors are going to watch their stocks go up and then jump ship because Paulson was stupid enough to buy their stock. The stock will come back down, and the US loses money.

For conspiracy theorists, this is just the beginning of the evil plan by the smoking gunman to turn America into a communist state. While I can’t agree with the over all conspiracy, the thoughts of Federal government ownership to the tune of $700 billion is VERY disturbing.

I’m honestly wondering what the hell is going on with our politicians! Perhaps we citizens of America are not sending enough letters and emails. Or maybe we think communism is a good thing. Since when did the federal government buying equity stakes into troubled industries become OK?

Sure, we’ll save a few thousand jobs in the immediate future and cripple the entire country for decades to come. I’m not going to be one of those people who talk about how “The End is Near“, but this communism stuff is really starting to boil my red-blooded American capitalist… well, blood. And if I hear one more person talk about this being socialism, I’ll exercise my Second Amendment rights on you!

Socialism and Communism are not the same thing. In fact, what our Congress and White House are practicing is the opposite of what most socialist believe. Most socialists would say things like, “Damn those billionaire running their banks, squeezing us little folks out of our money. We need a government handout. Where’s my bailout?” That’s not what Pelosi and company are saying.

They are saying, “Those poor defenseless billionaires running their banks and automobile companies are loosing so much money because those evil consumers are not consuming enough to keep them rolling along the way we want the world to work. Those poor businesses need a handout at the expense of the taxpayer.”

Meanwhile, the capitalist will say, “What a bunch of idiots! They pissed away our money and they want us to bail them out despite their antiquated technology and crappy service! We are compassionate, and will give you another chance. Here’s a tax break to go update your crap engines that haven’t improved our dependence on fossil fuels despite the fact we knew it was a problem 30+ years ago. And here’s a tax break for you idiot banks who keep your call centers in the United States instead of outsourcing it to India where we end up with crap service and no answers to any of our problems. If you ef up again, go lobby the communists Pelosi and George W. Bush. Otherwise, invest in a cardboard box.”

Proposition 11: Creates 14-member redistricting commission responsible for drawing new district lines for State Senate, Assembly, and Board of Equalization districts. Requires State Auditor to randomly select commission members from voter applicantpool to create a commission with five members from each of the two largest political parties, and four members unaffiliated with either political party. Requires nine votes to approve final district maps. Establishes standards for drawing new lines, including respecting the geographic integrity of neighborhoods and encouraging geographic compactness. Permits State Legislature to draw lines for congressional districts subject to these standards.

My Take

About time!!! Redistricting has taken place in California to ensure that incumbents stay in office. It is the most absurd garbage to take place in government and erodes the value of democracy. It is also part of why we are in the mess we are in right now. Our Congress is failing us because we’ve allowed them to remap themselves to keep idiots in office. This will help solve that problem.