Minimum wage kills jobs, reduces economic freedom

President Obama’s plan that would increase the federal minimum wage to $9 an hour would not only reduce the availability of jobs (especially in the minority population, Obama’s biggest support group), but it would prevent the freedom of workers to work jobs for less than the minimum wage even if both parties agree to the lower wage, wrote the Cato Institute’s James Dorn in an article published in U.S. News and World Report.

“If the prevailing market wage for low-skilled workers is $7.25 per hour and Congress mandates a minimum of $9 per hour, then workers who produce less than that will not be retained or hired,” he wrote.  In other words, basic economics.  As the government increases the minimum wage, businesses are necessarily forced to make a decision: reduce their workforce or increase prices.  Which would you prefer?

Both, of course, have negative consequences for our nation.  If businesses reduce their workforce, workers who previously had jobs will probably seek unemployment benefits, costing the American taxpayer money.  If companies increase prices, consumers will naturally spend less which, in turn, effects the cash flow of American businesses and may necessitate further layoffs and curtail innovation.  The minimum wage death spiral gets strengthened.

“The best way to stimulate the economy and create jobs is to increase economic growth by expanding free markets, not by increasing government power through a higher minimum wage.”

Senate passes Internet sales tax bill

As if the American people aren’t taxed enough, the Senate has approved a proposal that would require online retailers to collect sales taxes if they claim revenues in excess of $1 million in states outside of their physical “brick-n-mortar” locations.  Meaning, you’ll start paying taxes for virtually all of your purchases through large online retailers like Amazon.com, Overstock.com and others.

The bill passed the Senate by a vote of 69 – 27, meaning several Republicans voted to further tax their own constituents contrary to their generally small government and fiscally responsible rhetoric.  The “Marketplace Fairness Act”, as politicians have cleverly named it, is designed to level the playing field – they claim – for smaller retailers without major online stores.  We all know what happens when government attempts to “level the playing field”, don’t we?  It ends up costing the rest of us more money, and the government ultimately winds up as the entity benefiting.

If enacted, the government will collect an estimated $12 billion in additional revenue.

Ron Paul trashes Boston police response, and he is right

It does not take a sitting Congressman or member of government to publicly criticize the Boston police department for their martial-law-style pursuit of the second Boston bombing suspect a week ago.  But perhaps it does take someone outside of Congress to be right in their assessment.  Former Congressman Ron Paul took to the digital airwaves to lambaste how Boston police dealt with the second bombing suspect, which included shutting down transportation systems, driving tanks down residential roads and forcing residents out of their own homes at gunpoint.

And he’s right.  Going house-to-house and forcing people outside of their own homes at gunpoint has no place in a free society.  Treating every man, woman and child in Boston like potential terrorists only makes terrorism win.  Terrorists have already won the battle over fear. They have successfully conned the United States into expensive and never-ending wars overseas. They have conned the United States into establishing so-called “security departments” (like the TSA) that strip-search grandmothers and children. They have conned the United States government into imposing martial law and conducting warrantless searches at gunpoint.

The question here is how much liberty are we prepared to give up to maintain some semblance of “security”? We know that people were forced out of their homes by men with guns during this incident, but as Paul pointed out, after all the police presence, after every person brazen enough to walk the streets was patted down via the use of robots, after all the martial-law style military presence in the area, it was a resident that found the second Boston bomber.

How should we handle these kinds of situations?  How do they handle any other murder suspect that’s on the loose? Do they drive tanks down residential streets and force people out of their homes at gunpoint? No. Do you realize how much help from the PUBLIC that the police department got? Put out a picture of the suspect on television and get the public looking for this individual, and I’d bet my bottom dollar that the suspect would have been found and apprehended HOURS before he actually was. Suspects who are on the run don’t like the public knowing what they look like. They want to blend in. Criminals use the public for their own benefit, and this kind of martial law that happened in Boston is precisely the reason why.

Unemployment fraud largely ignored by media

A show of hands, please – how many knew of the nearly $3.3 billion the government overpaid in unemployment benefits due to fraudulent claims in fiscal year 2011 alone?  My guess … probably not many, and that is a large part of the problem of government corruption and how little Americans know of the true cost of our nation’s social entitlement layer of spending.  If knowing is half the battle, then we may have already lost.

Reported by the Federal Reserve Bank of St. Louis and largely ignored by the media, fraud accounted for billions of taxpayer dollars spent on claims made my people of all income levels, mostly due to unreported extraneous income that would have disqualified them from some, or all, of taxpayer benefits.  Americans – your friends and neighbors – are actively and intentionally gaming the system to extract more of your hard-earned tax dollars, and they are doing it right under your noses.  If you are a responsible adult who works for a living, you are getting screwed.  We are all getting screwed.

Tax the rich? Guess what, we already are, big time!

Although the rich are often criticized for exploiting loopholes in our tax system to reduce their tax burden (which does happen), the top 10% in this country also holds the mark for shouldering a widely disproportionately big percentage of federal income taxes every tax year.  Although the top 10% collect about 45% of our nation’s total income, they are responsible for paying over 70% of the nation’s income tax.

I suppose it is clear to see why states with the highest tax burden, like California, New York and New Jersey, have seen a net loss in domestic migration of its residents, while states with lower tax burdens like Arizona, Florida and Texas have seen a rise in migrations.  Combined with state income taxes, many residents in the more heavily taxed states pay more than half of their income straight to the government.

Empirical evidence is clear that taxes effect inter-country migrations, and the states that confiscate more from residents are always on the losing end.  When the rich leave, who is left footing the tax bill?  The bill does not simply go away.

Even Bill Maher, hardly a source for right-wing or conservative commentary, has lamented on his program just this year that taxes are getting more and more outrageous.  “Liberals, you could actually lose me,” Maher said. “It’s outrageous what we’re paying [in taxes]. Over 50 percent. I’m willing to pay my share, but yeah, it’s ridiculous.”

California is often cited as an example of negative inter-country migration, and why not?  Californians recently passed Proposition 30, which not only raises sales taxes from 7.25% up to 7.5%, but also creates new and higher tax brackets for the state’s more successful residents.  Folks making between $250,000 and $300,000 are now forced to fork over 10.3% of their income to the state, up from 9.3%.  The richest people, those earning more than $1 million a year, will pay 13.3%, up from 10.3% (a whopping 3% increase).  Combine that with federal income tax rates and people’s tax burdens in California easily extend past 50%.

In terms of making the rich “pay their fair share”, I agree.  Let’s lower the income tax rate, encourage further innovation, hiring and spending, and keep our nation’s rich people (and their money) happily settled into the United States and our bank accounts rather than in Cayman Island accounts to avoid our nation’s punitive system of taxation.

Milking the rich hits new high as average tax rate reaches 35%

Article Highlights

  • Rich paying largest share of federal taxes since 1979
  • Top 1% of earners pay over 35% of income to Washington
  • Bottom 20% pay nothing

A new study published by the Tax Policy Center in Washington D.C. finds that the rich are paying the largest share of federal income taxation in decades, which puts into question Obama’s claim that the rich need to pay their “fair share” to fix our government’s debt problem.

Earners in the  top 1% pay an average of 35% of their income to the federal government, the study found.  The bottom 20% pay nothing, and often, receive more in tax rebate checks than they paid into the system.  This amounts to a deficit in tax payments, and essentially, an additional yearly paycheck.  Historically, lower income earners are paying lower taxes than ever.

“My sense is that high-income people feel abused by being targeted always for more taxes,” said Roberton Williams of the Tax Policy Center.  Not only do higher income earners FEEL targeted by our tax system, they ARE targeted with high, punitive taxes – revenues that are then either wasted or lost within the incomprehensible layers of our government bureaucracy.

The Congressional Budget Office recently predicted that government revenues in 2013 will set new records.  Add in the fact that the large majority of those revenues will come from higher income earners, and political rhetoric that demands the rich “pay their fair share”, it does not take much of an imagination to realize just how devastating our tax system is to our nation’s future growth.  No wonder the wealthy maintain overseas bank accounts.  No wonder businesses outsource labor to other nations.  If those resources are kept within the borders of the United States, they are confiscated!

It seems the rich are paying their “fair share” after all.  When nearly 1 in 5 Americans pay nothing in taxes at the end of the year, it casts a serious shadow over the merits of progressive taxation and the class-based society that results from those tax tiers.

Obama’s State of the Union proposals to cost taxpayers $84 billion

MoneyPresident Obama put forth a plethora of proposals during the State of the Union speech last week that, he said, would not raise the national debt.  According to the National Taxpayer’s Union, the total cost to taxpayers of those proposals could reach $83.4 billion, the most expensive plan yet by Obama during the State of the Union speech.

“This is a slush fund that has a lineage back to the 2009 stimulus and more recently the President’s Jobs Act from the last Congress; back then CBO scored it at $39.16 billion over five years, which breaks down to $7.832 billion on an annualized basis,” said NTU’s Executive Vice President, Pete Sepp.  The taxpayer’s watch dog group estimated the cost to implement 40 items mentioned during Obama’s speech that would cost the American taxpayer.

Speaking of the President’s vague tax proposals, Sepp said that they “contained enough buzzwords to bear a close resemblance to the tax reform blueprint he put out last year, which in turn draws from previous administration plans. The window-dressing changes, but not so much what’s behind it.”

Listen to the Podcast of the NTU analysis.