Thursday, August 13, 2015

Let's Eliminate a Bunch of Zeros

Back in 2012 President Obama, to the exquisite delight of Statists everywhere, rangled a tax increase from Republicans in Congress. The top income tax rate increased from 35 to 39.6%. In addition, the top tax rate on dividends and capital gains also went up from 15 to 20%. An additional 3.8% levy on dividends, interests, capital gains and royalties also kicked in courtesy of Obamacare. Consequently, through July of 2015, the federal government just set a record by collecting a whopping 2.6 trillion dollars through the first ten months of the fiscal year. For those of you who would like to see what that actually looks like written out....$2,672,414,000,000.00. There are currently only 148 million of us actually working either full or part time. That means that the government took an average of $18,000 from every worker in the United States.

For most enterprises, record revenue announcements are cause for jubilant celebrations and perhaps a champagne toast. But, fun fact, over this same record breaking ten months, the government spent $3,147,953,000,000.00. So despite record revenue, our government managed to add another 466 billion dollars to the debt, or more accurately, $465,539,000,000.00. So, tell me again why the government has a revenue problem and not a spending problem?

It has always frustrated me that neither political party seems to give a flying fig about this. Republicans occasionally conjure up some faux outrage, but whenever they actually have a chance to do something about it, they don't. Democrats don't even try to fake it. Deficits? Who cares about deficits when there are voters to buy? The problem is that the numbers are just so large and terrifying, most people can't wrap their heads around it, so we would just rather not think about it at all. Well, I'm here to help. Let's cut this thing down to size by eliminating a bunch of zeros!

Suppose your take home pay every month was $2,642.00. Let's also suppose that you routinely spent $3,148.00 every month. Very soon, you would be in some serious trouble, right? I mean in 12 short months, you would have piled up over $6000 in debt! At this point, you would have dwindling options. You could get a second job, rob a bank, or maybe buckle down and do something about your spending habits. But surely we can all agree that the last thing you would do is purchase a new car! 

So, the next time any candidate for President announces some new fabulous program promising some free something or other, remind yourself about the car thing. Why would we spend more money we don't have before we fix the going in the hole every month thing? And when they assure us that over some ten or twenty year period ( fortunately long after they are out of office), the new program will have paid for itself, ask them, "how about coming up with a program that will pay for the 18 TRILLION DOLLARS of other programs that we still haven't paid for before we add any new ones onto the pile?"