Friday, August 4, 2017

August, 2017, Part 3, Political Class Insanity: Insane In Canada, Obama's County Level Economic Failure, and Lies About the Rich and Taxation

It is the beginning of another month which means it is again time to review the latest political class insanity from Washington and around the world. Political class insanity takes many forms including the wasting of taxpayer wealth, criminal fraud within government programs, inane and stupid political quotes and actions, the inability to create and implement effective and efficient government programs, stupid and ill performing economic policies and strategies, and other forms of insanity that continue to evolve and surprise and shock us.

1) The other day we talked about how HUD and the Commerce Department of the Federal government were losing tons of taxpayer money via either outright fraud or incompetence. As readers of this blog know, these are not the only Washington bureaucracies that waste hundreds of billions of dollars every year. But apparently American politicians are not unique in their ability to waste taxpayer wealth.

Consider this atrocity of government spending up in Canada, courtesy of Josh Elliot of CTV News on July 19, 2017:
  • In Tom Riley Park in Etobicoke, Ontario, Canada, there was a very steep dirt and rocky path into the park that led into a community garden within the park.
  • Local resident and retired mechanic, Adi Astl, decided to do something about this treacherous situation since several of his neighbors had actually fallen down the steep undeveloped path.
  • He and his neighbors collected $550 which he used to buy materials to build wooden stairs that allowed park visitors to safely descend the dangerous path into the garden area in the park. 
  • Even better, he supervised and paid a homeless resident to build the steps. Everyone wins: safety is enhanced and a down on his luck homeless person receives some money for a job well done.
  • Astl says that his neighbors thanked him, strangers visiting the park thanked him and members of the garden club who maintain the garden thanked him for his work.
  • And that is where the happiness ends since the local political class decided they could have none of this good will towards men going on on their watch and they tore down the steps, recreating the original dangerous situation.
  • The local politicians and bureaucrats claimed that the steps he built were not up to city regulations and had to be torn down and that it was their job to build the right kind of steps.
  • Unfortunately, their estimated cost for the project was between $65,000 and $135,000 for a simple flight of steps.
  • While the mayor agreed that the city estimate for the steps sounded “completely out of whack with reality,” he still stood by his decision to destroy a private citizen solution to a public safety problem: “We just can’t have people decide to go out to Home Depot and build a staircase in a park because that’s what they would like to have.”
A perfect example of how the political class and government works: inefficiently, corruptly, and ineffectively and it took a private citizen, thinking about the safety of his neighbors up in Canada, to show why taxpayers always get screwed as government gets larger and larger. $65,000 for a small set of stairs, no corruption, kickbacks, and favoritism going on here. Not. 

This is just another small example of how the U.S. is quickly approaching a national debt load of $20 TRILLION. Government jobs done poorly and expensively.

2) Obama liked to brag on how he single handedly saved the U.S. and world economy when he came into office. Of course, we have debunked that self promotion so many times:
  • The economic recovery he claims to have led was by far the weakest economic recovery in at least 80 years.
  • The jobs that were created during his Presidency tended to be low paying, menial jobs which accounted for stagnant household wages and earnings during his entire time office.
  • The labor participation rate during his recovery was at the lowest levels since the economic disaster known as the Carter administration almost 50 years ago.
  • He accomplished all of this trivial success by almost doubling the national debt from about $10 trillion to $20 trillion, weakening the economy for decades to come.
  • All of his economic programs, e.g. Cash For Clunkers, Cash For Appliances, etc. were unadulterated failures.
  • A record over 94 million American adults were out of the work force by the time he left office.
And now we can add another dismal aspect of his economic strategy and leadership skills. According to a recent article by the 538 website that was summarized in the August 4, 2017 issue of The Week magazine, “Just 20 counties were responsible for roughly half of the of new businesses created in the U.S. since the recession. That’s .64% of the 3,100 counties in the U.S.”

So 99.36% of the counties in the country accounting for half of the growth in new businesses in the country during the Obama reign while just .64% of the counties accounted for about the other half. Talk about skewed results, results that probably helped get Trump elected. When your party’s economic policies basically ignore over 99% of the country, there has to be negative election impacts which is exactly what happened. 

Makes you wonder how inept you have to be from an economic strategy perspective to incur such ridiculously skewed results.

3) Politicians, especially Democrats, always think that raising taxes will solve all of the country’s problems. They fail to acknowledge that their mismanagement of the government they are in charge of wastes untold hundreds of billions of dollars a year via inefficiencies, ineffectiveness, redundancies, and outright criminal fraud. 

If they were doing their jobs, there would likely be more than enough money and taxpayer wealth found to actually resolve some problems. Instead, their constant, stupid, and brainless response is to just raise taxes.

And when calling for more taxation, Democrats always like to play the blame game and blame the “rich” for not paying their fair share of taxes. This diverts the spotlight from what the real problem is, their inability to do their jobs without wasting taxpayer wealth, and try to shift the blame to the rich. 

This empty and incorrect rhetoric does nothing but divide Americans against each other, again diverting attention from politicians’ inabilities. We have stated too many times in this blog that no American, rich or poor, should pay another penny in taxes until the American political class finds out how to handle the hard earned tax wealth we turn over to them everyday. Until they do that, no more raising of taxes or dividing the country along economic lines and lies. 

Because, in reality, if you look at the numbers, the rich pay far more than their fair share in taxes, proving again the politicians, especially liberals and Democrats, lie to our faces. If you look at a recent article on the website, which did an analysis using research from the Tax Foundation, you will find that:
  • The top 1% of earners in this country, the very rich, pay a whopping 39.5% of the Federal income taxes in this country; in other words they pay at a rate that is almost 40 times higher than their incidence in the general population.
  • They pay well over half a TRILLION dollars a year in Federal income taxes.
  • Those earners in the top 1-5% pay 20.5% of all Federal income taxes, or about five times their incidence in the general population.
  • Thus, the top 5% earners in the country pay over 60% of all Federal income taxes.
  • Contrast that to the bottom 50% of earners in this country that pay only 2.8% of Federal income taxes, “which is more than 14 times less than the top 1%, even though this group is 50 times as numerous.”
  • For the richest 1%, the effective average tax rate is 27.2%, meaning that well over a quarter of their income goes into Federal income taxes.
  • For the next group (up to 5%), the effective tax rate is still a high 23.6%.
  • Taxpayers with incomes in the top 10% part with just over one-fifth (21.3%) of their earnings.
  • Since 45% of American earners make too little to pay any Federal income tax, the effective tax rate for the bottom 50% of earners is just 3.5%, about one eighth the rate of the top 1%.
Thus, this kills another political class set of lies who like to claim that rich people do not pay a high enough percentage in taxes since they get special tax treatment. The above realities and numbers also prove this claim to be a lie.

Again, no American, especially the rich, should pay another penny in taxes until the political class finds a way to get smart and stop wasting all that tax revenue. And as the above numbers prove again, politicians lie on all matters, including tax matters, do not believe their insane claims when it comes to fairness and reality in the realm of taxation. More insanity to follow.

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