As the United States economy starts to recover many in the United States are starting to see the American Recovery and Reinvestment Act in new light. By the time the stimulus plan will kick in it almost certainly will not be needed. Government is simply not efficient in creating new projects and agencies. As Ron Paul said, the only thing the Stimulus plan will “not stimulate anything except for the growth of big government.” This is becoming all too apparent.
Congress has provided the perfect way for government to continue to grow in the coming years. By lowering the amount people can deduct when donating to charities we will see less donations to charity from the top tax payers, the largest donors to charity in terms of dollars donated, resulting in less goods and services provided to those who need the help the most. Can you guess who will step in to fill the space of the then delinquent charities? Yes, of course the government. We just won’t be able to pick which charities are worthy of private dollar donations. Taxes will increase and consumer choice has become even lower. One more freedom taken away one bill at a time.
The largest impact from the Stimulus plan on the worker will be the huge increase in the deficit. Taxes will have to increase to new highs as the United States struggles to pay off the deficit since it is doubtful that congress will ever see a cut in spending as a saluting. Congress members loves to show off a new program or two to the voters rather than to show how much they saved. Cost is no concern when dealing with other people’s money. The long term effects of the American Recovery and Reinvestment Act will merely create a short term stimulus with long term dire consequences. Of course by the time we start to feel the pains of the plan there is a decent chance that this will become a new presidents problem since it can take years before the new bubble stats to burst. By rushing to pass the American Recovery and Reinvestment Act ,the Democrats were able to push their agenda with extreme haste to Obama’s desk before anyone had a chance to even read the plan. How could the members of congress vote ‘yes’ without reading what they were actually voting on. Wait, this eerily sound similar to the Patriot Act…
Saturday, April 11, 2009
Sunday, February 22, 2009
California's Sales Tax Increase: Who Protects The Tax Payer?
California’s Sales Tax Increase. Just a penny…
Given California’s inability to balance the budget, the Governator signed a bill that will increase sales tax by just a penny. Arnold Schwarzenegger’s PR team has led us to think that a penny increase on the dollar is infinitely small, but this is certainly not the case. Currently I’m paying 8.25% in San Mateo for sales tax and Schwarzenegger’s bill will increase my tax;(by a penny ) placing the final sales tax will be at 9.25%. The penny increase in sales tax actually ended up increasing sales tax by over 12%! I’m certain if the media called the plan a 12% increase in sales tax there would be riots in the streets.
I’m disappointed that all of the major papers in California talked only about a penny increase in tax per dollar. An penny increase in sales tax is much more feasible to pass than a 12% increase in the publics’s eye. Apparently, the writers are all aligned with the government.
Who Protects the Tax Payer?
The impact of the tax is going to be disastrous to business. With two thirds of our economy based on consumer spending, Californians will simply have less to spend. This will cause more unemployment throughout the state as companies simply cannot hire. The California Government has just crushed aggregate demand. Tax receipts will also decrease as Californians buy goods under the table, purchase more goods online, and simply now have less to spend due to higher levels of unemployment.
Low taxes work, but high unjust taxation does not necessarily increase tax revenue. Lowering taxes increase employment as consumers can inject more of their dollars into the economy at the very time the economy most needs the consumer to spend.
The lessons of history are before us. We must execute extreme skepticism when the government announces a temporary law. So often we find that these temporary laws become permanent and slowly bound us to a road of serfdom. Of course we have to keep in mind that we should entrust the government bureaucrats with our money since they know what is best for us… right?
Given California’s inability to balance the budget, the Governator signed a bill that will increase sales tax by just a penny. Arnold Schwarzenegger’s PR team has led us to think that a penny increase on the dollar is infinitely small, but this is certainly not the case. Currently I’m paying 8.25% in San Mateo for sales tax and Schwarzenegger’s bill will increase my tax;(by a penny ) placing the final sales tax will be at 9.25%. The penny increase in sales tax actually ended up increasing sales tax by over 12%! I’m certain if the media called the plan a 12% increase in sales tax there would be riots in the streets.
I’m disappointed that all of the major papers in California talked only about a penny increase in tax per dollar. An penny increase in sales tax is much more feasible to pass than a 12% increase in the publics’s eye. Apparently, the writers are all aligned with the government.
Who Protects the Tax Payer?
The impact of the tax is going to be disastrous to business. With two thirds of our economy based on consumer spending, Californians will simply have less to spend. This will cause more unemployment throughout the state as companies simply cannot hire. The California Government has just crushed aggregate demand. Tax receipts will also decrease as Californians buy goods under the table, purchase more goods online, and simply now have less to spend due to higher levels of unemployment.
Low taxes work, but high unjust taxation does not necessarily increase tax revenue. Lowering taxes increase employment as consumers can inject more of their dollars into the economy at the very time the economy most needs the consumer to spend.
The lessons of history are before us. We must execute extreme skepticism when the government announces a temporary law. So often we find that these temporary laws become permanent and slowly bound us to a road of serfdom. Of course we have to keep in mind that we should entrust the government bureaucrats with our money since they know what is best for us… right?
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