Wednesday, April 28, 2010

Why do we turn to the Government for help?


I recently received a call from a "concerned citizen" talking about how her child was diagnosed with Autism and that she had contacted her congressman for help. I am sorry for her situation, but the first thing that lept to my mind was "why?". Why would you call a congressman or senator for help on a personal matter? Given the track record of our representatives, I think we all understand that he needed the photo op. I would have been more impressed if he had helped this person as an individual rather than spend money that wasn't his so there was no cost to him. I am sure I will receive mail asking why I don't care about autistic children. I do, but this is not about autistic children. It is about a systemic and cultural challenge that we face not only in this country but in board rooms and in our personal lives. We all want the bailout. Why didn't this person go to her church or community before going to her United States representative? Given all of the examples and historical information regardless of party in charge, why would anyone ask the government for help? Oh, yeah it's the money.

What are we thinking?

According to the Government Accountability Office (GAO) study (I wonder how much that cost) the "stimulus" has been bogged down in a bureaucratic morass. "As of February 12, 2010, $88.7 billion, or a little more than 30 percent, of the approximately $282 billion of total Recovery Act funds for programs administered by states and localities had been paid out by the federal government. Of that amount, approximately $36 billion has been paid out since the start of federal fiscal year 2010." To put things in perspective, the Stimulus package was enacted on February 13, 2009, Fiscal Year 2010 begins October 1, 2009. We are now into the third quarter of the 2010 fiscal year with little result. Economists are reporting that the stimulus bill has little or no effect. So we have authorized over 716 billion in funds and what do we have to show, a website that provides information that has yet to be substantiated by any reputable group including the GAO, and the government run around. How many people understand the process or criteria for obtaining funding? Not many as we hear in this audio clip. How many corporate groups behaved in the same way. Companies too big to fail, yet when we hear the news coming out about Goldman Sachs we begin to see the ability of large organizations to manipulate other large organizations. What we learn from this is the fact that people will follow the rules, the question is what rules are we following? This is true for any large organization. People are trying to get along find their way and the rules can be used both for or against you. Apple one of the most innovative companies has a general rule, "do what Steve Jobs says". He is an innovator, what is not certain is whether he has been able to "institutionalize" that spirit and ability to innovate. Microsoft has suffered significantly since Bill Gates has left. The leadership has not been able to capture the spirit of its founder. Business schools are filled with case studies on how to build a culture that innovates, few have succeeded. So how does this affect our government?

We the people need to be innovators, and transform how we view the role of government, business and ourselves. We must first determine what we want. Most people don't know what they want for breakfast, and while they would like to be the hero, it takes work, blood sweat and tears. Most of us may be too comfortable for that. The audio clip tells us the story of what we will become. The content of our character will be the person not wanting to work but standing in line for a handout. Rather than building something, we will wait for something to be handed to us. That is the result of social justice or socialism taken to its logical conclusion. We can look to Russia and China as examples of our future. If we are not careful, Cuba will be our legacy. In the business world, all we need to do is look to the Automotive industry as an example of this type of thinking. India will replace us as the new world leader. We must make choices and like all choices they have consequences.

Wednesday, April 7, 2010

The 16th Amendment Approaches


Section 9 of the Constitution of the United States of America places limits on Congressional powers. The original document stated "No capitation, or other direct, Tax shall be laid, unless in Proportion to theCensus or Enumeration herein before directed to be taken.", limiting the ability of the Federal government to directly tax individuals. The 16th amendment passed in 1913 completely reversed the original intent of the founders and has ushered us into the era we currently reside. The 16th Amendment states "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration." This seemingly innocent sentence allows Congress to write tax law in any way they deem fit, as we have witnessed over the last 97 years. The really interesting thing about our "progressive" income tax is that it punishes success, and is used to drive "desirable" social behaviors such as home ownership. Why do most of us own homes? Answer: The tax break. Why? Because a populous that has invested in the land is less likely to leave and as Ronald Regan put it "vote with your feet". They won't leave the Socialist Republic of California if they have significant investments and ties to the property. Fluid populations are harder to control, case in point Mexico.
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The 16th amendment is probably the single most important amendment to our everyday lives, and as April 15th approaches we must ask ourselves why do we look to the government to provide for us? Until 1934 people survived without social security and medicare. In fact, rural doctors were more plentiful than they are today. Why? Has socializing the banks, medicine, and manufacturing really helped us? Really? Where do we go from here? Well there will be a study and it will be someone else's fault because they really don't know what they are doing right? If that is true, then why do we continue to listen and put faith in them? We the people can change the Constitution of the United States by a 3/4 majority of the state legislatures. Remove the 16th Amendment (we did it with prohibition), and return our tax policy to pre 1913, where taxation was based upon commerce. We will have to stop government "entitlements". You know, "somebody owes me something". Do we realize that the reason we think that way is because the government has taken so much there is not enough left, so we have to go beg to get it back. They owe it to me, would not be possible, if "they" did not take it in the first place. April 15th is just the day our taxes are collected, for most Americans they are not paid until June 15th. This will extend into September or even October with current spending and deficit (a nice way to say debt). We owe more than we produce. Soon our interest payments will exceed our operating budget and we will be insolvent. I know many people will say I am crazy and it will never happen. Really? Let's put it in context. You make $100 per month. Your Operating expenses (the government's budget) is $65 per month, debt payments are $25 per month (making the minimum monthly payment) and our income has been reduced due to unemployment by $10. What does that leave us at the end of the month? Correct. ZERO. Now, we want the new doctor plan, and the washer is getting old and falling apart. How are we going to pay for that? Yup add more debt right? That raises the minimum monthly payment to 35 per month and we are now in the hole by $10 per month. How long until the repo man shows up?
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People get themselves into this position every day. Our government has placed us all in this position. We are leaving a legacy of greed, sloth, and indulgence. It is not capitalism that has done this. It is socialism in the name of the greater good. Evil masks itself as good. Good intentions pave the way to where we are headed. I truly believe that no one has intended to do harm, but harm we are doing. I believe that people want to help others, but is this emotion that has lead down the wrong path. Understand, I want to help others, but I must first understand that I am fallible and should only help to the extent I am able. By sacrificing myself, I will cause harm by not being able to help in the future. I must manage my life. It is my life, and if I do not manage myself, then what good will I be to others? Just because we have allowed this to happen, does not mean we must allow it to continue. Ask yourself.
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Is this the legacy we leave our children? Is this really the best we can do? I choose to have faith and reason that others will find the will with me, and we will not leave this as our legacy to our children. I believe we will find a way to put a halt to the travesty of current legacy and become once again the beacon on the hill, signaling freedom and opportunity for all who embrace it.