Posted by: Calmseas (Mike) | February 17, 2009

2012: A New Birth Of Freedom! (Part 1)

My aunt recently sent me the following:

Remember Nikita Khrushchev, the Soviet leader who said that he would bury America? Some thought he would launch a nuclear attack to bring about his prophecy? Hardly. Khrushchev was perfectly willing to let America move to the left incrementally; here a little, there a little.

When speaking about FDR’s New Deal, Khrushchev said, “We can’t expect the American people to jump from capitalism to communism, but we can assist their elected leaders in giving them small doses of socialism, until they awaken one day to find that they have communism.”

Khrushchev recognized the New Deal for what it was: socialism, pure and simple.

Now, my comments:

The United States of America is a socialist country and has been since Franklin Roosevelt’s time.  The debate now is not whether we will have socialism, but rather how much.  The Republicans would give us a little less; the Democrats a little more.  Last November, we elected a president who now is at the head of the most left-leaning government since Lyndon Johnson. This president, I believe, wants to give us full-fledged, European-style socialism.  He ran on a socialist agenda, and we elected him knowing that agenda full well. This president’s policies, if fully implemented, would remake us into the United States of France as concerns our military and our economy; the United States of Sweden as concerns our social system and the welfare state; the United States of Britain or Canada as concerns our health care system; and the United States of Russia as concerns our freedom.  In my estimation, we are not only going down the tubes, we are presenting nearing the end of the tube. And I fear that our newly elected president in league with a liberal Congress will hustle us swiftly out the end.

Now the bright side: If America can vote hard-left politicians into power (as we did in the last election)—politicians who are far to the left of where most Americans reside on the political spectrum—then maybe, just maybe, somewhere down the line we will have the fortitude to elect a leader more to the right of the “comfort zone” of the Republican Party. I believe that it is to the right of the mainstream of the Republican Party where our country will find a leader who can truly turn this country around and point us again down the path of prosperity and of greatness.  We had such a leader twenty-five years ago: His name was Ronald Reagan.  The person whom I think can do this again for us at this critical point in our history is Mike Huckabee.  If he decides to run again, I will be with him this time—all the way!

Why do I believe that Mike Huckabee is the leader who can turn things around for America? Consider this: If we can change just one thing that is gravely in need of a comprehensive and profound overhaul, that one thing is without a doubt our tax system. Overhauling the way we finance government would turn this country on its head, in a good way.  My preference is the elimination of the income tax altogether, replacing it with a consumption-based national sales tax. However, the next best thing is Mike Huckabee’s flat tax.  If somehow (and it is a pipedream at this point) we could ever get a 15% flat tax in place—for everyone, businesses and individuals, with no deductions—and write it into the constitution so that it can’t be changed with a simple act of Congress, just image how the economy would skyrocket! And imagine the new birth of freedom that would sweep across this country as people once again take control of their own money.

A simple, flat tax—with no loopholes, and no way to modify it except by constitutional amendment—would transform our society, and it would do so almost overnight. Mike Huckabee is the only one out there who would introduce such sweeping changes in the way that the American government functions; and changing America’s ways is the only hope for her long term survival both financially and, I believe, as a viable and sovereign political entity.

Look for Part 2: “What I would do with my new-found financial freedom.”

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Responses

  1. I’ve been debating whether to reply now, or wait until after part 2. However, I think I’ll go for it.

    I agree that we have leaned a bit into socialism since FDR, and thank God for it. If it weren’t for unemployment insurance, roughly 8-9 percent of this country’s able and available bread winners wouldn’t have bread for their children’s dinner table right now, and without “social” security, many more of our nation’s elderly would be found frozen in their homes this winter.

    I’m grateful Mike Huckabee’s 15 percent flat tax is currently just a “pipedream.” Let’s just say, for the sake of argument, Mike Huckabee had been elected and had the luxury of a Republican-contolled congress to push forward his stategy– that he could somehow convince the rest of the GOP to buy into a 15 percent flat tax with “NO LOOPHOLES” for individuals OR corporations (and you will NEVER convince Republican-based corporate America to give up its loopholes) what would our world look like?

    Well, first of all, right now roughly 8-9 percent of this country’s able and available work force is out of work, so that represents a substantial loss in tax revenue. Many, many more individuals are currently teetering on the brink of losing their jobs and their homes. Increasing their taxes right now would put even more households right over the edge. More lost revenue. Read the headlines–small businesses and large corporations, alike, are struggling just to stay afloat; a 15 percent flat tax would be the straw that broke the camel’s back for many of them. More lost revenue. More lost jobs. More lost revenue. On and on it goes….

    Perhaps if our economy (and the global economy at large) was in better shape to begin with, we could almost survive a 15 percent flat tax, but from where we are right now… there’s NO WAY. Likewise, a consumption-based sales tax would be crippling. Don’t believe me? Look what happened when gas prices went through the ceiling last summer. People quit buying gas, except for their essential needs. In the current state of our economy, raising the cost of products we’re already NOT BUYING because we can’t afford them would be crazy. We would be forced to trim our shopping budget even further.

    But, hey, maybe in four years this country’s economy (and others around the world) will be in better financial health and be able to tolerate the kind of sweeping reforms you’re suggesting. However, if we’re in better financial health, corporate America definitely won’t stand for a “no loopholes” tax because it would cut into their precious profit margins and their shareholders would absolutely pitch a fit. Huckabee’s plan will never get the support of the rest of the GOP because the GOP traditionally represents corporate America.

    In fact, now that I think about it, a 15 percent sweeping, across-the-board, “no loopholes” flat tax– a tax that doesn’t discriminate and doesn’t recognize social-economic structure– kinda smacks of communism, don’t you agree?

    Khrushchev would love it! 😉

  2. As always, thanks for your comments, Robin.

    Contrary to what many folks think about conservatives, I don’t think that I have a corner on the font of all knowledge; and I can certainly change my thinking about things given evidence to the contrary. Be that as it may, I’ll try to tackle some of your points and lay out a conservative position for you to consider, though you have likely heard all of the arguments before.

    I do not have a problem at all with unemployment insurance. However, it is not paid for by the government, as many might believe. Employers pay into the unemployment fund and have a running account as I understand it. It is possible for an employer to deplete their account—though if that happens, I’m really not sure where that leaves the employee. Our small business pays “a lot” to the State of Michigan in unemployment money each month. Unemployment rates go up for employers when they lay employees off and begin to use their account. That gives quite a bit of incentive for an employer to lay off workers only as a last resort to maintain cash flow or even, in the extreme, to keep their company afloat. It is generally, I think, a pretty good, balanced program. But it is not in the least a government handout to workers; rather, the government merely administers the program; it is funded 100% by employers. So just as no union has ever paid a wage to a worker—though they portend to be able to guarantee jobs and wages (but that’s another blog post)—no government has ever paid out unemployment benefits from their general fund (at least as I understand the program, and I am no expert on it by any means).

    Now if I get that detailed on everything here, this comment will run on for pages. Just a couple things on Social Security and then I’ll quit and come back to this all later.

    The main problem that I have with Social Security is that it does not at all function as it was originally intended to function (like so many other things in government). Originally, Social Security was strictly a retirement savings account for workers. Now, however, none of the money “saved” actually exists; Social Security is nothing more than a “pass through” from present workers to retired workers. This is primarily a result of the huge expansion of the Social Security mandate over the years. What follows is directly from the Social Security Administration’s own website:

    The current Social Security system works like this: when you work, you pay taxes into Social Security. The tax money is used to pay benefits to:

    * People who already have retired;
    * People who are disabled;
    * Survivors of workers who have died; and
    * Dependents of beneficiaries.

    The money you pay in taxes is not held in a personal account for you to use when you get benefits. Your taxes are being used right now to pay people who now are getting benefits. Any unused money goes to the Social Security trust funds, not a personal account with your name on it.

    As you can see, SSA readily admits that money comes in the front door and goes directly out the back door. It is not a savings program as so many people think it is and as it was originally intended. And it has been expanded over the years to cover the disabled, spouses of contributors who have died, and dependents of workers who have died. The result of the expansion of the program over time has resulted in its insolvency, with band-aids placed on the many problems every few years. I don’t know what the solution is except that it will either require higher taxes, program cutbacks, or both.

    The conservative would reject higher taxes to solve Social Security’s problems and would, instead, opt for perhaps some cutbacks and greater efficiencies. The conservative would also point out that the norm for any government program, once established, is to expand and become more and more inefficient over time. Eventually, most government programs become unmanageable and unable to be sustained without new tax revenues. This results in “out of control” government. The conservative is, therefore, very wary of any new government programs and, instead, would try as hard as possible to find private industry solutions to societal challenges of all types.

    More to come.

  3. Mike-If your agreement with Huckabee means the total federal paycheck taxes(of employees) would be about 22%, including the 7% social security taxes, then I think that will be a hard sell to the 65% or more of Americans who will get a tax increase. While that idea may be more fair than the current progressive income tax, it’s not going to get popular support because it will only benefit the upper middle class minority.

  4. Hey, Mark. So you found my blog.

    All of the flat tax concepts that I have heard discussed have a floor below which workers would pay nothing. So lower income folks would have no tax liability at all. There may be a few other deductions of sorts mixed in (they would be necessary to “sell” the program, as you stated), but the broad concept is that the tax liability would be evened out by closing the myriad of loopholes and complexities that exist today. A lot of this was done with the Reagan tax overhaul of 1986; unfortunately, a lot of that has been undone in the last 20-some years as corporate and special interests have gotten their digs back into the system.

    My whole point is that the system must be simple and it must be fair; it is neither now.

    Concerning your comment regarding tax increases for 65% of Americans: Under a “flatter” tax system—eliminating the loopholes—lower and middle income people would actually pay less, while upper income folks and corporations (if they are chucking their income into all of the existing loopholes now) would pay more. There is actually a built in progressiveness to the concept.

    However, as we all know, the government can’t get enough of our money. From their standpoint there could be a very simple two-line form:

    1. How much do you make?
    2. Add 10% and send it in.

  5. It’s been a few days since I last looked at this post and the comments. Let’s see, I think we dispensed with unemployment, social security, and the flat tax concept. So, let me make a few comments on some of the other items that Robin brought up.

    A consumption-based tax (national sales tax): I am convinced that this is the best way for a free people to fund their government and government-related projects. To begin with, only those who spend money actually pay the tax—and many of life’s staples and necessities would not be taxed at all, e.g., basic food and clothing, and maybe other items. Luxury items (e.g., yachts, summer homes, expensive cars, and the like) could perhaps be taxed at a higher rate. All of this would serve to make this tax quite progressive.

    The problem with our current tax system is two-fold:

    A. It allows for the government to interject itself into every aspect of our personal finances;

    B. It penalizes productivity (taxes every nickel you earn), while at the same time it rewards consumption.

    Think about it: There are no government restrictions or regulations on your spending; you don’t need a license to spend your money; you don’t need a permit; you don’t need to report what you spend to the government on their specially-devised form. You can spend what you want on whatever you want. You are even encouraged to spend money that you don’t have (probably to ease the conscience of our beneficent government that also spends barrels of money it doesn’t have). Until recent years (before the advent of IRAs and 401(k) accounts), you were even discouraged from saving—and still are to some extent (e.g., interest, dividends, and other “savings” are all taxed).

    On the other hand, making money involves all kinds of regulations and restrictions. At the very least you must report your income (a huge disincentive to produce). Additionally, there are myriad licenses, zoning and other local regulations, inspections, and other kinds of restrictions, requirements, and reporting that you must comply with to earn your money. Making money in the USA has become a living nightmare. It is a wonder that anyone tries their hand at small business anymore.

    With a national sales tax system, we become a freer people as we become more secure in our personal finances. We would have incentives to earn and to save, and disincentives to spend, though spend we will—and our spending will be the basis of the government’s revenue. All of the paperwork burden is removed from the individual, and businesses would have just two lines on their tax form: 1. How much did you collect? 2. Send it in. (Of course, there will be more complexity than this, but this is the concept.) The icing on the cake, at least as Mike Huckabee would proffer it, is abolishing the IRS. Now, who can argue with that.

    Next up: Corporate America, tax loopholes, and the myth that “GOP” is synonymous with “big business.”


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