Government spending “costs” jobs…it doesn’t create jobs

You work your neighbor does not.  He spends government “entitlement” funds to live or spend as he perceives appropriate.  Does he pay taxes?  How does the government entitlement create a job, doesn’t.  It creates another gov’t position remunerated by taxes.  How many people have to work to support your neighbor?  He is a burden to you, not boon.

What impoverished man ever spent his way to prosperity?

Same neighbor again, does not work, pay taxes, nor can he secure a loan or credit card based on government entitlement income.  His fixed government income compensates monthly expenditures such as housing, food, medical, utilities, gas, car payment; insurance … his disposable income is neither capable nor comparable to yours.  The $5 or $100k earned by you enables your choices for disposable income and that creates long-term full-time private sector jobs.

America has spent money we do not have since FDR attempting to stimulate the economy.  It does not work.  Neither do high tax rates.  You cannot have your cake and eat it too.  In fact, the U.S. did not have Federal Taxation until “progressive” President Woodrow Wilson, on October 3, 1913, imposed one and it affected only 2% of the population.

The beauty of our free market Capitalism is in providing opportunity’s to anyone with the courage, an idea, and ability to succeed.  Succeed or fail…Indeed!  Do remember these ridiculous ideas…Ever own a pet rock?  What about the little umbrellas for your drink?  Ever see a ball for your car antenna?  Do you own a Snuggie?  Or what about the mounted talking fish?  The “Left” would have us believe that evil lurks in Wall Street Exec’s and hedge fund types.  Yet greed exists in every culture, every type of government, and every society ever to exist.  It is incumbent upon the stakeholders or stockholders to hold them accountable, not the government.  Just as it is our responsibility to hold public officials accountable.

Examine the Great Depression.  Unfortunately if you ask 100 people “what caused it” 99 would tell you it was a failure of business.  Milton Friedman expresses that this is absolutely incorrect, “it was a failure of government.”

Do you enjoy saving money on purchases?  Do you cut coupons?  Do you love the deals at Wal-Mart, Meijer’s, Costco… thank the Chinese, Nixon or American Unions.  A great topic of economic decay is the declining Industrial Production of America.  Union labor costs largely contributed to jobs loss to China, Mexico, India, and others.  Oh, that’s right; it is not fair to pay someone in the Far East 10 cents on the dollar to work.  Oh, that’s right, it doesn’t cost $200k for a home; cost of living is less there.

Imagine what a quarter pounder with cheese will cost if the S.E.I.U. is able to unionize people at McDonalds, Burger King, or Wendy’s.

An excellent case is the rust belt or specifically Michigan’s auto industry.  Did Ford or GM consider Toyota or Honda as business threats?  How many plants for Chrysler, GM, or Ford are located in Canada or elsewhere?  Why did these firms accept the “plush” terms of union contracts in the 50’s – 60’s?  Ironically, an import car recently outsold a domestic model; cost of doing business in Canada is economical; they could afford it whether or not it made good business sense.  So you can’t beat ‘em, join ‘em?  Or, is it, buy ‘em?  American foreign automotive acquisitions failed.  Volvo, Jaguar, Lotus, SAAB, Opel … how did they work out?  No?  Perhaps building a new brand, Saturn, from scratch?  LOL.

The “left” would have you believe in the sweatshops and forced labor for cheap wages.  However, it doesn’t wash. First, the cost of living is not equitable to the US standard of living.  Labor costs drove and continue to drive businesses away.

If you owned a business and could produce a product for $10 per unit or Import it with total cost is $5 … it doesn’t take a genius to know importing positions your business for competition, market share, profits, and ultimately opportunity to stay in business.

Immigrants will work for $15 here, but the person on unemployment; heck, he wouldn’t think of working for less than $25 an hour, when he can relax at home on unemployment.  I guess beggars can be choosers.  Why should he when the Federal government will send you a check for not working?

In “Free to Choose” by Milton Friedman concludes government intervention and protectionism breed conflict.  In a Free Market, you only make money if you can provide someone with something they are willing to pay for.  Free markets breed cooperation and are competitive over the spectrum of economics.  You can’t make money when you fail to provide something he/she doesn’t need.

Gary Becker, 1992 Economics Nobel Prize winner, provides a superior analysis in a speech on Economics and the Academy, “Most economists in the 50’s, 60’s, and even into the 70’s were not strong believers in Free Markets.  They may have taught it, but they didn’t believe in it.  Most economists of that time believed that a centralized economy would likely perform better than a free economy…More and more evidence supports how poorly centralized economies perform.”

Keynes economic champion Paul Samuelson said central planning could provide more economic output; however, it would do so at the expense of restrictions on political freedom.  The problem for America is Keynesian economists currently control Washington DC and Democrats are willing to push aside the Constitution and our liberties to have government power.

 “There is absolutely no way for the American people to fund Social Security and Medicare obligations.  The architects of the New World Order are sending this country into receivership.  The next several years, the United States will become   a third world country unless something is immediately done to drastically cut government spending, end our military empire and the Federal Reserve abolished.”  – Federal Reserve

The premise of Progressive economic theory rests on Keynesian, two-dimensional view of the world and has been since the 1960’s.  For example, if 50 economic marbles are line in a row and one marble moves then the resultant action of the other marbles is predictable.  This erroneous economic platform failed then and maintains failure in today’s economics.  The correct view is a bowl full of the 50 marbles, when one moves the resultant action is not predictable; nor is it an obvious reaction by the other economic factors.

The unprecedented action by Obama, Pelosi, and Reid to spend our way out of the recession; add unlimited expense to Federal debt via Health Care; and expand Federal control into the American life is nauseating.  The result will be hyperinflation; global deteriorating dollar value; and raise the interest the US must pay on new security instruments and existing debt.

“It all comes down to this basic premise: if you lose your economic freedom, you lose your political freedom and in fact all freedom.  Freedom is something that cannot be passed on genetically.  It is never more than one generation away from extinction.  Every generation has to learn how to protect and defend it.  Once freedom is gone, it’s gone for a long, long time.  Already, too many of us, particularly those in business and industry, have chosen to switch rather than fight.”  – Ronald Reagan

 “What prudent merchant will hazard his fortunes in any new branch of commerce, when he knows not but that his plans may be rendered unlawful before they can be executed?”  – Federalist 62


  • Why do people fight to prove they have the right to exist on this planet today? 
  • For that matter, why are you here or should you be here?  Should you have been aborted?
  • How do you know you are entitled to live?  Die?  Walk?  Talk?
  • Do you fight for entitlements because you have been robbed of them?  Did your parents take them?
  • How do you know you if you are entitled to work or not work?
  • What employment or job are you entitled to?  Are you entitled to work anywhere you want?
  • How do you know Dr. Kevorkian was not entitled to do his work?
  • Did another entitled person write a book or tell you that you were entitled?
  • They did?  Really… how did they know?  Is that person God?
  • Are you entitled to be smart?  How would you know if you are dumb and deserve to be smart?

Are you entitled to money, housing, utilities, or car without working?  Why?

Why should your neighbor or someone in Idaho be responsible for your alleged entitlement?

Did they have influence over whether your parents attempted to have, had or kept you?

The economics of entitlements are ridiculous subject to elitism or superiority.  So is Bill Gates superior to you or me because he is the wealthiest man?  I guess he was entitled to it because he worked, planned, took risks; made mistakes; hired other entitled people who…wait, how did he know which ones were entitled to work for him?  He must have discovered ancient Mayan scrolls, depicting a secret formula hidden.  Oops, I guess Warren Buffet, Donald Trump, Steve Jobs, or Mark Cuban belongs to a super-secret fraternity and they were entitled to learn the secrets entitlements on the Mayan scrolls.  That is why they are rich.  Wait, how selfish of them not to share it with me!  Perhaps I will write a letter and ask to join their entitlement group.

Why are you entitled to anything:  when your mom is on welfare; has two other children to feed; has never worked; is not married; yet has $2000 worth of Tattoo’s and free medical care and even that was before the Obama Care debacle.

Curious, the entitlement conversation has me wondering if you are entitled to a spouse.  Who is entitled to attend Harvard and not Wyoming State University?  Wow, a question far too complex question for me to answer.  Ah, but no worries mate, I am confident a Washington Liberal can pretend to be almighty God and make the decision.

After all, look how wisely the social programs are managed!  The ‘Left’ continues to place lipstick on their Sow bride; except now, they are forced to turn their heads, avoid eye contact, and pretend their ‘budget and deficit’ (the Sow) won’t ask for a kiss.

Too many freedoms have lapsed right out from under our noses.  This is the call, our call, to fight back and protect what we conservatives and our founding fathers held dear as displayed in the Constitution of the United States of America.

Hey, Socialist’s, if you really believe the Obama, economic action would have caused an economic windfall, then examine the State of California; New York; Illinois or New Jersey (before Christie):  High taxes, excessive spending, and business regulations.  Obama acknowledges the nations problem and spoke of jobs during the 2011 State of the Union address.  Look, creating jobs is not rocket science and is actually easy.  The only problem is socialists and the progressive agenda.

Hey, Barry …Here is what you do:

  1. First reduce taxes by eliminated the billions generated by Obama Care.  When people have money …they spend it.  That means more homes sold, more cars sold, more TVs sold ….The more people spend, the more employees business needs to handle the additional sales.
  2. Second, cut oppressive business regulations.  The more difficult it is to do business…fewer industries will expand or add capacity. 
  3. Third, initiate Tort reform to reduce the likelihood of frivolous lawsuits.  When rules and regulations governing business are complicated, the cost of doing that business increases.

The real question according to Rush Limbaugh is:  “How do we help people like Bill Gates is working out of his garage?”

Life is not a box of chocolates.  If you read the identifying label as to what each one is, you know what you are going to eat.  Companies and people are fleeing high tax states and or sending production to China or Mexico.

Economic Suggestion for 2012 and 2013:  Keep your eye on Commodities.  Yes, oil and gold are mostly spoken of; but, many are nearing record price levels and China is buying up large volumes of copper as if it were the next gold.  Devaluation of the dollar on the world market and rising inflationary trends due to the commodity price spikes.  Until the volume of existing and foreclosed homes on the market, from the housing bubble, do not expect a near term turn around.

A weak dollar or perception of a weak dollar immediately strikes trouble with your bank accounts.  For example – Commodities.  The exchange and value of corn, wheat, gold and oil…are value based on America’s dollar.  When the world has less confidence in the dollar, regardless of whether banks act to support any nation’s currency…the price for a particular commodity increases.  Gas at the pump costs more; bread costs more; … every commodity based product costs you or your family more.

So when Standard and Poor’s warns of downgrading its rating of America’s debt instruments…negative perception of our dollar and investor confidence of it declines.

I offer Michael Schuyler, an economist who said, “As upper-income individuals save and invest less due to a higher tax rate on their capital income…capital formation drops, which reduces the amounts of plant, equipment, buildings, and other structures.”  In other words he says, “When a tax on upper-income individuals causes them  to work and save less, part of the tax burden is shifted to the rest of the population…as high -productivity; upper income people cut the time and intensity of their work…they employ fewer people…and reduce their presence in the workplace…

Neal Boortz puts it more simply, “The first thing when wealthy people do when money starts pouring in is to stop getting a wage.  They live on their capital gains and dividends and pay a 15% tax rate.  They pay nothing to social security and Medicare because they have no wages.”  So who is hurt?  Government?

“The most dangerous myth is that business can be made to pay a larger share of taxes, thus relieving the individual.  Politicians preaching this, are either deliberately dishonest, or economically illiterate, and either one should scare us.  Business doesn’t pay taxes, and who better than business could make this message known?  Only people pay taxes, and people pay as consumers every tax that is assessed against a business.  Passing along their tax costs is the only way businesses can make a profit and stay in operation.”  – Ronald Reagan. 

 Now do you get it?

An old axiom is, “those who forget history are doomed to repeat what previously happened.”  This thought reflects what men pondered through the ages as a social and political question: “does history repeat itself?”  Yes, it does and in more ways than you think.  Do you know what a flood plain is or how it is determined?  How many world empires existed?  Do you know any teenagers who believe(s) their parents are dumb, only until later in life to discover they were not so dumb after all?  Inflation?  Recession?  Night and day?  Tides?…the list is almost infinite.

Bad economy…sure, but you know it’s bad when, Larry the Cable Guy said, “I seen a prostitute outside with a sign sayin, no payments til …”

Examine these figures on Job Growth from 1999-2009 from the Bureau of Labor Statistics, US Dept. of Labor:

Job Growth:  Texas – 866,000 Florida – 291,600 Arizona – 194,800 Virginia-138,400

Job Loss:  California – 170,400; Indiana – 225,300; Illinois 332,700; Michigan – 687,600

Can you guess what commonality the growth states have in common?  They are right to work States and those losing jobs are forced Union States.

Depending on your age, do you recall walking into the bank, the teller recognized you, and called you by name; they completed your deposit slips; put your coins into the coin counter;  returned your checks; or …  ah yes, the good old days.  Now it is difficult to find a full service bank that provides full service or for that matter a full service gas station.

Government regulations eliminated many of these services and banks responded by hitting in the “pocket book.”  Banks have lost almost $30 billion in revenue from credit card regulations; ATM’s; Overdrafts; Student Loans;  In order to be profitable fees are now imposed on what used to be courtesy’s.  Now you face fee’s for checking; fund transfers; money orders; falling below your minimum balance; access to pay bills online; wire transfers; debit cards; …50%+ of bank revenues are now from fee’s.

Democrats demonize business and corporate profits and they want to tax them…absurd!  They are double dipping us!  Corporations make a product or service and sell it to us and then pay property tax, income tax… and provide a profit to their stockholders.  The more business has to pay government…prices increase and we pay more to buy or use the product.  Who is the winner…government.

Everyone feels inflation and costs are rising beyond the average pay raise.  Yet, a portion of inflation has is kept in check by what is termed the ‘Wal-Mart’ effect.  In simple terms, examine the actual size of the half-gallon ice cream container; it isn’t a half-gallon.  Many of the products you use now sell in reduced volumes to keep prices in check.

Categories: ECON 101: The Series, Economics

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  1. HOMEWORK for this topic…

    1. Keynesian Economics – Learn the absurdity of the Left
    2. Discover how the economy reacted to the tax cuts by: JFK & Reagan
    3. Learn what taxes are imposed on imports. Is each country different?
    4. If you have more money in your paycheck…what do you do with it?
    5. How much of the economy does the government control?
    6. What happens when government controls the economy vs. private sector
    7. Weimar Republic – 1919 to 1933: Learn how similar it is to the U.S.
    8. Learn the relationship between the U.S. Gov’t and Federal Reserve
    9. …and who is now purchasing the majority of U.S. debt.

    Books: Mises: The Last Knight of Liberalism, Guido Jorg Hulsmann
    Movie Time: “It’s a Wonderful Life”; “My Fair Lady”; “The Secret of my Success” “Working Girl”

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