Friday, May 15, 2009

$8798 per Taxpayer to Payoff Deficit

Last month the nonpartisan Tax Foundation published their annual survey about taxes and the budget deficit. The amount of deficit per taxpayer is currently $8798, a 400% increase in two years. From pages 7 & 8 of their report (emphasis added):
Americans were asked again this year if they would be willing to pay their share of the budget deficit in order to balance the budget. While in 2007 this figure was only $1,789 per individual tax return, this year that number has ballooned to $8,798 because of the bailouts and the Troubled Asset Relief Program under the Bush Administration, as well as the stimulus and fiscal year 2009 omnibus spending bills under the Obama administration. Only 6 percent are willing to pay the additional $8,798 in federal taxes to eliminate the deficit; 81 percent are unwilling.

To those who said they were willing to pay higher taxes to cut the federal deficit, we asked a follow-up question: “If you paid that extra $8,798 in additional taxes, how do you believe today’s Congress would use it?”

Just under half of respondents (48 percent) believe that the government would use the money to increase spending and not pay off the deficit, while only 17 percent believe the government would use it to pay off the entire deficit. Just under one-third of respondents (32 percent) believe the government would pay off part of the deficit and increase spending with the rest.
Half the people willing to pay the additional amount don't even believe the government will use it to reduce the deficit. Then why the hell bother?

$8798 of debt per tax payer. According to Wikipedia, the average household income in the US is just over $50,000. A married couple with two kids and income of $50,000 pays about $3,200 in payroll and income taxes, a little more or less depending upon the state (in Michigan it would be $3,170). A married couple with no children pays around $6,600 and a single person pays $9,000. $8,798 represents a 100% to 300% increase in the tax rate to pay off the deficit.

I'm repeatedly told this is the best country in the world and this is the best government possible. But look at the results! This is the best? $8798 of debt per taxpayer. Every time I state the government should be abolished, I get idiotic questions such as, "Who'd educate the children?", "Who'd pave the roads?", "Who'd stop crime?", "Who'd feed the poor?". WHO THE HELL CARES!! It's time for those advocating for this "great" system to start actually providing rational justification for it. Not only would those things be provided in anarchy, it wouldn't cost an average of $9,000 in tax and $8,800 of debt.


The state owns your children

"A Minnesota judge is expected to decide whether a family can refuse chemotherapy for a 13-year-boy's cancer and treat him with natural medicine, even though doctors say it's effectively a death sentence."

http://news.yahoo.com/s/ap/20090515/ap_on_he_me/us_med_forced_chemo

Tuesday, May 12, 2009

I'm a Libertarian but . . .

Once again we have someone claiming to be in favor of free markets as long as they're regulated. Aelfscine states:
I'm generally in favor of a free market, except that I don't believe that's that's what we've been having. I think we've been having a rigged free market, and that's when I think government intervention is needed.
If a market is rigged, by definition it isn't free.

So how is our market rigged and who's doing the rigging? Aelfscine uses healthcare and financing as two examples. Yet
these are two of the most regulated and un-free markets in this country. The govt intervenes in almost every aspect of these industries. Licensure laws, advertising laws, patent laws, etc make these industries the exact opposite of a free market. Harry Browne has shown numerous times (e.g. here, here, here, and here) how govt intervention has destroyed the best health care system in the world into the useless mess we have today. The govt has rigged those markets. More intervention is the last thing we need.

His examples with credit cards are just as bad.
however, your credit isn't good enough to get multiple cards - maybe you're young and starting out. If your credit card company just randomly decides to triple your interest rate, you are screwed, and the 'free market' can't help you.
Randomly decides? Every credit card account I have or had (and I've had dozens) has an agreement. That agreement states what the interest rate will be as well as when and why it will change. There's nothing random about the rate changes.

Claiming some can't get multiple cards is absurd. I know individuals with $100,000 of credit card debt, no business profits and little other income, yet they keep opening new credit card accounts. I know children with credit cards. One kid kept getting pre-approved offers when she was 7 years old. If someone can't get a second credit card, it isn't because the market is free. It is because of govt intervention and heavy regulation.

He ends with an extremely absurd statement:
we are currently undergoing a free market 'correction' and shady mortgage companies are going down in flames . . . . . . . . If someone had stepped in and broken up the problem before it got this bad, the free market could have had a correction without getting it all over everyone' faces.
With FNMA, FHLMC, FHA, FHEO, FHAP, FDIC, ECOA, SIPC, SOX, HUD, FCRA, PATRIOT, FRB, PTI, CRA, HMDA, etc. just how much more regulation is required. Just one of those laws or organizations creates an unfree market and I've listed close to 20.

The last thing we are currently undergoing is "a free market 'correction'". Those who can't figure that out may be beyond hope. For those who are figuring that out, you may want to read Tom Woods new book Meltdown
.

Monday, May 11, 2009

New Credit Card Bill: Friend or Foe to the Unsecured Debt Seeker?

Here's some stuff in the new credit card bill. Sounds good on the surface, but I am certain that this will reduce the amount and increase the price of credit long term, making all borrowers worse off than they were before…. Cigarettes say “SMOKING WILL KILL YOU” and people still light up…. The road to hell is paved with good intentions...

_Require anyone under 21 to prove that he or she can repay the money before being given a card, or have a parent or guardian promise to pay off the debt if he or she defaults. Youth will be locked out of paying for an investment in themselves… training, classes, travel that could help them increase their earning potential.
_Require lenders to give customers 45 days notice before increasing rates and mail their bills 21 days before the balance is due. This one isn’t so bad, but in 45 days I could skip town. In this market 45 days is a long time. The Bretton Woods agreement broke down over a weekend.
_Ban fees if customers want to pay their bills by phone or online. Who is going to pay for the customer service rep to answer the phone and the extra people in the mail room? We are!!!
_Prohibit over-the-limit fees unless a cardholder elects to be allowed to go over their limit. I agree with this one, but I don’t think it will help too much. Like the “are you sure you want to delete?” message on a computer. You get so used to it that you don’t even think when clicking… until it’s too late. Doh!
_Require lenders to say how much time it would take and how much money in interest would be paid if only the minimum monthly payments are made. I don’t see anything too wrong with this the extra ink is negligible.
_Require that gift cards remain valid for five years. What? Why? If it’s my card and I make it, it should be under the terms that I want (as long as the terms are explained in simple language all over the card) Gota be difficult for retailers to plan inventories for cards that last that long.

What do you guys think? (mind you I'm against the govt. having any authority to do any of this... Caveat Emptor (let the buyer beware))

On a side note... when are we going to respect private property? I hate how the Chrysler bond holders are being vilified in the media... You can't just get out of contracts with govt. pressure. The debt is the bondholders' property and they can do what they please with their own property. I'm not a religious man by any means but to borrow from a wristband, WWTSD? What Would Tony Soprano Do? He would break their knee caps and then refinance as usurious rates of interest. Bust a deal and there will be/should be some pain.

Thursday, May 7, 2009

I could not make this stuff up if I tried

"It's a system that does not work in theory-- at all-- but in practice we make it work because we have to make it work." - John Dugan, Comptroller of the Currency

The quote is after 6:25 in this interview:
http://www.npr.org/templates/story/story.php?storyId=103908284

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Judge Richard Posner, former University of Chicago law professor and so-called "free market champion" mentions several industries where deregulation and privatization are good things: telecommunications, surface transportation, oil pipelines, highways... "It's just banking is special."

Hear the comment starting at 6:25. http://www.onpointradio.org/2009/05/richard-posner-on-a-failure-of-capitalism

Some other great Posner quotes from the interview:

"Conservatives believe that the depression is the result of unwise government policies. I believe it is a market failure. Without any government regulation of the financial industry, the economy would still in all likelihood be in a depression. We are learning from it that we need a more active and intelligent government to keep our model of a capitalist economy from running off the rails. The movement to deregulate the financial industry went too far by exaggerating the self-healing powers of laissez-faire capitalism."

"The depression has hit economic libertarians in the solar plexus because it is largely a consequence not of the government's over regulating the economy and by doing so fettering free enterprise, but rather of innate limitations of the free market."

I quit listening after 10 minutes.

Monday, April 27, 2009

New Policy Threatens Food Quality and Safety

I wrote this article for my online journal in early April. Today’s alfalfa sprout recall makes the issue all the more relevant.
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[Late in March] the FDA issued a statement warning consumers to avoid all pistachios and “pistachio products.” Setton Farms, the country’s second-largest pistachio facility, is contaminated with four strains of salmonella. Rather than warn the public about foods produced by this particular company, “… authorities said consumers should avoid all pistachio products until more information was available.” (emphasis mine)

Reactionary responses are typical in times of fear, resulting in pleas for new regulations. The pistachio contamination affords totalitarians a new opportunity to erode food quality and safety.

According to an Associated Press article, nonspecific, all-encompassing recalls may become the norm:

"It could take weeks before health officials know exactly which pistachio products may be tainted with salmonella, but they've already issued a sweeping warning to avoid eating the nuts or foods containing them.

The move appears to indicate a shift in how the government handles food safety issues — from waiting until contaminated foods surface one-by-one and risking that more people fall ill to jumping on the problem right away, even if the message is vague."


Indeed, the FDA’s response to today’s alfalfa contamination is sweeping and reactionary. The FDA declared all alfalfa suspect until proven otherwise. “FDA will work with the alfalfa sprout industry to help identify which seeds and alfalfa sprouts are not connected with this contamination…” (emphasis mine)

This obtuse reaction is less about protecting public safety than it is about protecting the government-corporate regime. If regulators shut down an entire segment of the food industry rather than address only the affected parties, then consumers—
a) might not find out that contamination issues are most frequent among corporations that have secured government favors, and
b) might not realize that the existence of government regulatory agencies is a primary cause of large-scale outbreaks.

For example, Peanut Corporation of America’s disastrous peanut contamination resulted from poor standards that can only arise from collusion between state and industry. PCA’s owner, Stewart Parnell, was influential in drafting food safety standards as a member of the USDA Peanut Standards Board. His company was awarded contracts with government run free school lunch programs in California, Minnesota, and Idaho. PCA knowingly shipped contaminated peanut butter to its customers 12 times since 2007. (In fitting irony, the company also sold salmonella-tainted peanut butter to FEMA for disaster relief kits in Kentucky and Arkansas.) PCA needed not concern itself with maintaining clean facilities; as a government contractor, it was guaranteed a source of income regardless of its performance.

In a free market, companies with such lax quality control and sanitation would not survive for long. They would have to produce high quality food or risk being out-competed by companies offering superior goods. Contrast this with the increasingly fascist regime, in which a peanut company owner writes federal standards for his own industry, uses his influence to curry political favor, and, when his product sickens hundreds of people, declares that he is free from culpability since his facilities meet federal guidelines. Existence of government agencies necessarily undermines food quality.

Despite their best public relations efforts, PCA finally declared bankruptcy in February 2009. Perhaps to prevent any more of their favorite gangsters from going out of business, regulators will now recall entire crops across-the-board when a single company’s products are contaminated. Note that it is the food conglomerates—those frequently involved in product recalls—that are lobbying for greater government oversight. For example,

"Kellogg Company CEO David Mackay wants food safety placed under a new leader in the Health and Human Services department. He also called for new requirements that all food companies have written safety plans, annual federal inspections of facilities that make high-risk foods, and other reforms."

One blogger wrote, “Kellogg’s is a multi-billion dollar company asking for a government handout to do what Kellogg’s should be doing – selling a safe product.” Indeed.

But taxpayer funded, corporate controlled federal regulatory agencies are exactly what fascists want. Agribusinesses lobby for legislation to shut down the entire sector when their particular products are contaminated—effectively keeping themselves in business while forcing their competitors to suffer for their negligence. It is easier to force out the few remaining quality producers than to upgrade their own operating procedures. The government gets more money, gets to “create jobs” by hiring more regulators, and gets to look like heroes protecting the public good. This perfect pairing is a win-win scenario for both the corporations and the state. Who loses? Smaller producers who are prohibited from showcasing their superior products. People who pay taxes. People who eat food.

State agencies such as the FDA and USDA are threatening access to quality food. As regulations increase, expect a cycle of more recalls, more regulations, more recalls, and potential food shortages. Do what you can to prepare.

Introduction

Welcome to the Detroit Area Anarchy Group blog. We are a group of professionals (accountants, computer programmers, engineers, teachers, writers, etc.) who meet regularly to discuss the theory and practice of anarchy. We reject the notion that anarchy entails nihilism, chaos, or violence, and we serve as a positive example of voluntary non-coerced cooperation resulting in mutual benefit.

Most of us became acquainted during the 2007-2008 Ron Paul presidential campaign and continued meeting thereafter as the Ron Paul Investment Club. Over time our discussions broadened from investment topics to the ethics of fractional reserve banking, business cycle theory, intellectual property rights, and several philosophical issues. ‘Anarchy’ thus more accurately describes our common goal and subsumes the various topics we like to discuss.

We each arrived at anarchism from different backgrounds. As such, we do not automatically agree on all issues nor pretend to know all the answers. We encourage open discussion. Through debating, we become better able to articulate and refine our positions in the pursuit of truth.

Our hope is that this blog will:

- Extend our in-person discussions by providing a venue to more deeply explore anarchist theory. During meetings we often realize we need to further research particular concepts. We can post our findings and updates on the blog. We may also summarize articles supporting our positions, or develop well-reasoned critiques of opposing arguments.

- Facilitate awareness of current events—both those that threaten freedom and those that advance the cause of liberty. Antiwar Radio, LRC (Lew Rockwell), The Ludwig von Mises Institute, Strike-the-Root, and other online resources provide good opportunities for staying informed. This blog may link to relevant articles, interviews, and lectures from such sites.

- Encourage personal growth by holding each other accountable (in a friendly way) for achieving personal goals: learning new skills, developing investment strategies, starting independent businesses, etc. We may use the blog to report progress toward these goals or to seek advice and encouragement when needed.

- Develop a trusted network of friends. Keep in contact with those who move away or travel the world, and invite new members interested in individuals rights (the term ‘individual rights’ being a redundancy, of course).

- Demonstrate that voluntary interaction achieves far more than government ever could. Anarchy works.

Anyone is welcome to comment and participate in this blog. To learn more about our group or to attend a meeting please contact one of us.