But Now You Know

The search for truth in human action

Real Americans Don’t Buy American


When you hear those lazy, tax-dollar-stealing car company reps on the radio saying you should “buy from us, or otherwise be sure to Buy American”, don’t forget that “Buy American” is unamerican.

Not only do they rob the taxpayers, but these lazy bureaucrats want us to buy inferior cars, out of fake patriotism

Not only do they rob the taxpayers, but these lazy bureaucrats want us to buy inferior cars, out of fake patriotism

The American Dream is for everyone to earn their way, NOT for people to be given an easy way out with affirmative action.

And Buying American™ in order to protect overpriced, inefficient union monopoly jobs is the very worst form of Affirmative Action.

We Americans have, for good reason, a long-standing belief in “meritocracy”, people getting what they earn, earning what they get.

Most of us have ancestors who came here because they could earn what they deserved, regardless of class, nationality, or whatever…at least compared to anywhere else.

And they passed on the kind of attitude necessary for such a tremendous move. Most of us still have a healthy dose of it, today.

And we’re in the one place in the world where we still have some opportunity to exercise it. Not as much as America used to, especially not as much as we’d like…but still more than anywhere else.

So we love this place, America, because we really do believe it’s the Land of the Free and Home of the Brave.

We love it enough that it’s hard to avoid getting suckered into tolerating, or even supporting, something completely unamerican, if it’s clothed in enough patriotic trappings.

The examples of that today are many…more than since the middle of the Cold War. But, aside from the many others which get plenty of bandwidth on the net already, there’s one which I almost never hear anyone speaking out against.

So I’m doing that, now.

Do you know who deserves to have the money for that new car you want to buy?

Whoever makes the best car in your price range. Frankly, that’s the only answer that fits with the Spirit of America.

Same with your shirt, your birdhouse, your silicon implants…whatever.

Yet some people, mostly bloated, bureaucratic corporations who make products which can’t compete on fair terms because they’re overpriced and underquality, have the nerve to tell us that it’s patriotic to “Buy American”. And because the word “American” is one we love, we’re tempted to fall for it.

But we need to stop.

If Mitsubishi and Hyundai make better cars than Ford and Chrysler, then they’re going to get more money. Then Ford and Chrysler are going to struggle. The solution? It’s for them to get off their lazy butts…and we, as Americans, are just the kind of straight-talkers to SAY that about them…and make better effing vehicles.

But if they can convince us to unconditionally “Buy American”, along with forcing us to give them billions in bailouts, then they don’t have to. They can keep making mediocre-or-worse cars. Which is what they’ve done since at least the mid seventies.

I remember an ad where Lee Iacoca leaned forward earnestly at what was implicitly his desk as a Ford executive, and said, in essence, “OK, we admit it, we have been half-assing the cars. But you taught us a lesson, so now we’re making really good cars. All you have to do is come back and try us out, we’ve decided that Quality is Job One, now.”

That was twenty-something years ago, if I recall correctly.

Just recently I saw another ad. Another car exec looking repentantly into the camera and ernestly saying something like “OK, we get it, we’ve been half-assing the cars. But you taught us a lesson, so now we’re making really good cars. We think quality is job one, now. No…really. This time we mean it.”

No, they’ll mean it when the people — who really do buy inferior cars because of emotional appeal — stop letting  the FEELING of being patriotic come before the actual actions of American ideals.

I’m going to stick to being a REAL American, and you should, too.

Support whomever deserves it, because anything else is not only wrong, and unamerican, but self-destructive in the long run.

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May 4, 2009 Posted by | Economy, Politics, Society | , , , , , , , , , , | 12 Comments

Trickle-Down Taxation


2. A heavy progressive or graduated income tax.

Item #2 of the Communist Manifesto: "A heavy progressive or graduated income tax". What isn't mentioned is that this was a way Marx could make the poor even poorer and weaker, not the rich. Marx gained power from the strife caused by poverty.

One of the best-sounding of the freebies that Obama is offering to hand out (if it’s not just another politician’s empty campaign promise) is exempting everyone who makes under $200K from the income tax. This one even tempts me. Lower taxes are good for the economy, for economic freedom, and of course for everyone who earns less than that amount of money.

But there’s a serious down-side to this. How do we fund all of the other freebies he is giving out, if we are going to cut government tax revenue with this one?

Of course the answer is simple: We are going to tax the people who make OVER $200K so much more that it makes up for the loss. Obama says it’s only fair, to “spread the wealth around”.

Now this may not be quite as bad as it sounds:

  • First, people who make over $100K or so pay most of the taxes, already. Unfortunately, Bush’s tax cuts were not really all that “for the rich”, and “wealthy” people already pay almost all of the taxes. It was pointed out today that there are some companies, in fact, that are forced to pay more taxes per year, individually, than 66% of all families. It’s famous that the top two percent of earners pay something like 60% of the taxes.
  • Second, tax cuts boost the economy, which increases tax revenue. Both Reagan and Kennedy both demonstrated this, cutting and simplifying taxes, and having tax revenue increase.

Unfortunately, those two things aren’t enough. The billions paid by people who earn less than $200K still adds up…and tax cuts don’t all work equally well.

For example, tax cuts that favor one group over another help the economy less, while ones that spread the burden evenly help everyone more. In fact, simply spreading the burden evenly, with NO tax cut, would boost the economy more than cutting taxes for some people, while raising it for others.

Especially when the taxes (as they already, are, and will now be more) are designed to punish hard work, success, and contribution to society.

Just as a slight increase in interest rates, so small it certainly doesn’t change any one person’s mind, has a large nation-wide impact on how much people borrow, so a tax that increases as you earn more money has a nation-wide impact on how much people earn, depressing income growth.

But there’s something involved, that’s more important than ALL of that:

WHEN Barak Obama raises taxes on people who earn more money, the wealthy will not pay a penny of it.

You will.

The counterpart to trickle-down economics (which points out that wealthy people who earn more money spend and invest more, allowing all of society to become more wealthy) is…

Trickle Down Taxes

When you raise taxes on the rich, they ALWAYS respond to defend their wealth. The more money and power they have, the better they can do this. They can give themselves raises, pay accountants to shelter their income, or otherwise make up for the new tax.

But where do they get the new money, to pay themselves enough to make up for the taxes?

From you.

Wealthy people and companies can, for example, raise prices to pay themselves enough extra to make up for the taxes. Guess who pays the higher prices.

They can also cut jobs or pay among their employees, in order to make enough to pay themselves more. Guess who the employees are.

Along with those two tools of passing along higher taxes, the rich and powerful can cut quality of products, again to save for themselves. Ice cream that was once two quarts is now 1.5 quarts, and the same price. Check Edy’s and Breyer’s, next time you’re shopping. Guess who ends up paying for all the reduced-quality/quantity food. Not the rich guys…the can afford to pay a premium for consistent quality.

Ultimately, ALL costs the government imposes on the wealthy, they pass down to you.

Oh, but the tax trickling isn’t done, yet.

If They Lose, You Lose More

Let’s say you, somehow, manage to force the wealthy and powerful to pay for their own taxes.

You are now shutting thousands of people out of jobs, and, causing more hunger and poverty.

Why?

Because the wealthy don’t put their money in giant Scrooge McDuck vaults, to play in while they cackle wickedly. Instead, they either spend or invest it. Spending it creates jobs directly. If they buy a car, someone built it, someone shipped it, someone sold it, people repair it, people clean it…maybe someone even drives it as their job. The less money ANYONE spends, the less work there is. But, let’s face is, the wealthy have more money, per person, than other people, and therefore supply more jobs with money.

Poor people have to mow their own lawns (if they have them). Middle class people may be able to pay someone to mow their lawn for them. A few dozen families might, between them, manage to keep one lawncare guy employed. But one wealthy dude may employ a half dozen lawn guys, all by himself. 

Take away his money, and the rich guy may have to lay off his lawn people…perhaps one hundred times the job impact of a middle class person having to stop hiring a lawn guy.

But most of a wealthy guy’s money is not spent, so it doesn’t make jobs.

Well, not directly.

Investment Creates Jobs

Instead, it gets invested. Invested money, of course, goes directly to creating wealth. That’s the whole function of investment…the reason that the investor gets more money back. The creation of wealth actually creates MORE jobs than spending money directly. This, in fact, is what actually drives employment, in general. Without investment, we really would “run out of jobs”. The economy would stagnate, and we’d end up like Communist China was, before they went “capitalist”.

The “capital” in capitalism is investment.

Rich people and companies are the reason most new jobs ever get created at all, because it requires investment to build the factory, or store, or restaurant, whatever it is. Even when poorer people start their own successful business out of pocket (something pretty rare, because of government regulation and taxes), they only create large numbers of jobs as they become successful and rich.

One of the many reasons the economy is so weak, now, is because investment is so rare, thanks to punishment of investment through taxes, regulation, deflation, and the preference for stagnating money shelters like bonds and treasury notes, over the stocks to which government has proven to be so hostile.

If we are to get back on the road to economic growth, we must first get on the road to economic freedom for all, including the wealthy, who just happen to pass on ALL effects we try to have on them, good or bad.

December 3, 2008 Posted by | Economy, Politics | , , , , , , , , , , | Leave a comment

   

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