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Another Reason To Move Away From California: ‘Conditions Are Like A Third-World Country’

Drought - Public DomainAs if anyone actually needed another reason to move out of the crazy state of California, now it is being reported that conditions in some areas of the state “are like a third-world country” due to the multi-year megadrought that has hit the state.  In one California county alone, more than 1,000 wells have gone dry as the groundwater has disappeared.  The state is turning back into a desert, and an increasing number of homes no longer have any water coming out of their taps or showerheads.  So if you weren’t scared away by the wildfires, mudslides, high taxes, crime, gang violence, traffic, insane political correctness, the nightmarish business environment or the constant threat of “the big one” reducing your home to a pile of rubble, perhaps the fact that much of the state could soon be facing Dust Bowl conditions may finally convince you to pack up and leave.  And if you do decide to go, you won’t be alone.  Millions of Californians have fled the state in recent years, and this water crisis could soon spark the greatest migration out of the state that we have ever seen.

Back in 1972, Albert Hammond released a song entitled “It Never Rains In Southern California“, and back then that was considered to be a good thing.

But today, years of very little rain are really starting to take a toll.  In fact, one government official says that conditions in Tulare Country “are like a third-world country”

Near California’s Success Lake, more than 1,000 water wells have failed. Farmers are spending $750,000 to drill 1,800 feet down to keep fields from going fallow. Makeshift showers have sprouted near the church parking lot.

The conditions are like a third-world country,” said Andrew Lockman, a manager at the Office of Emergency Services in Tulare County, in the heart of the state’s agricultural Central Valley about 175 miles (282 kilometers) north of Los Angeles.

As California enters the fourth year of a record drought, its residents and $43 billion agriculture industry have drawn groundwater so low that it’s beyond the reach of existing wells. That’s left thousands with dry taps and pushed farmers to dig deeper as Governor Jerry Brown, a 77-year-old Democrat, orders the first mandatory water rationing in state history.

The mandatory water restrictions that Governor Brown is imposing are going to be very painful for a lot of people.  We have just learned that some California communities will be required to cut their water usage by up to 36 percent

Californians are going to have to start preparing for a dry summer as the dehydrated state prepares for a water crackdown.

In a somewhat controversial move, California water officials drafted a set of mandatory conservation regulations outlining varying degrees to which communities will be required to cut back on water use, ranging from 8 to 36 percent, depending on their history of water consumption.

The regulations — slated for approval in early May — are part of California’s first-ever attempt at mandatory rationing. Earlier this month, Gov. Jerry Brown issued an executive order requiring a 25 percent reduction in urban water use, a historic step in a series of measures aimed at conservation ahead of the state’s fourth consecutive year of drought.

And of course it isn’t just the state of California that is dealing with drought.

All over the southwest United States, we are seeing conditions that we have not witnessed since the days of the Dust Bowl in the 1930s.

In fact, the water level in Lake Mead is now the lowest that it has been since those days, and it is expected to drop even lower in the months ahead

One of the most stunning places to see its impact is at the nation’s largest reservoir, Lake Mead, near Las Vegas. At about 40 percent of capacity, it’s the lowest it’s been since it was built in the 1930s.

“Just to see the rings around it, it’s just … kind of scary, you know,” says Darlene Paige, a visitor from New York. She’s standing at a vista point above the Hoover Dam on the Arizona side of Lake Mead.

That “ring” is the infamous bathtub ring around the rim of the reservoir. The levels have dropped 140 feet over the past 15 years, exposing a white stain on the gravelly brown mountains above the water. The level is forecast to fall an additional 10 feet by this summer.

According to the Government Accountability Office, it is being projected that a total of 40 U.S. states will be dealing with a shortage of water by the end of the next decade.

It has been said that “water is the new oil”, and this is just the beginning.  The truth is that as bad as things are here, we are actually in far better shape than almost everyone else in the world to deal with the emerging global water crisis.  All over the planet supplies of fresh water are disappearing, and the availability of water is going to increasingly become a major geopolitical issue in the years to come.

And even now, the U.S. government is taking all of this very seriously.  In fact, the EPA is already trying to train our kids to take showers instead of baths

Parents across America who struggle to keep their young rambunctious kids clean now have a new obstacle: the U.S. Environmental Protection Agency (EPA).

As part of its effort to help save the planet from the dangers of taking too many baths, the EPA’s WaterSense program is trying to convince kids they should avoid bathtubs in favor of showers, which it says is a far more efficient use of water.

“To save even more water, keep your shower under five minutes long—try timing yourself with a clock next time you hop in!” the “WaterSense for Kids” website says.

For most of our lives, most of us have been able to take water for granted.

But now things are changing, and we are going to have to adjust to these new realities.

So what do you think about this emerging water crisis?  Please feel free to share your thoughts by posting a comment below…

Barack Obama Says That What America Really Needs Is Lots More Debt

ObamacareWhen it comes to taking a chainsaw to the future of America, nobody seems more eager than Barack Obama.  Despite the fact that the U.S. national debt is on pace to approximately double during his eight years in the White House, he has just proposed a budget that would take government spending to crazy new heights.  When Barack Obama took the oath of office, the U.S. national debt was 10.6 trillion dollars.  Today, it has surpassed the 18 trillion dollar mark.  And even though we are being told that “deficits are going down”, the truth is that the U.S. national debt increased by more than a trillion dollars in fiscal 2014.  But that isn’t good enough for Obama.  He says that we need to come out of this period of “mindless austerity” and steal money from our children and our grandchildren even faster.  In addition, Obama wants to raise taxes again.  His budget calls for 2 trillion dollars in tax increases over the next decade.  He always touts these tax increases as “tax hikes on the rich”, but somehow they almost always seem to end up hitting the middle class too.  But whether or not Congress ever adopts Obama’s new budget is not really the issue.  The reality of the matter is that the “tax and spend Democrats” and the “tax and spend Republicans” are both responsible for getting us into this mess.  Future generations of Americans are already facing the largest mountain of debt in the history of the planet, and both parties want to make this mountain of debt even higher.  The only disagreement is about how fast it should happen.  It is a national disgrace, but most Americans have come to accept this as “normal”.  If our children and our grandchildren get the opportunity, they will curse us for what we have done to them.

All debt destroys.

All debt enslaves.

And when you are talking about an 18 trillion dollar debt, you are talking about an amount of money that is almost unimaginable.

If our national debt was reduced to a stack of one dollar bills, it would circle our planet at the equator 45 times.

How could we have done such a thing?

Thomas Jefferson once said that “the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.”  He correctly understood that government debt is stealing.  We are financially raping our children, our grandchildren and all future generations of Americans.  It is an incredibly wicked thing to do.

But instead of men like Thomas Jefferson running our country, we have men like Barack Obama running it.

And to Barack Obama, running up a trillion dollars of debt a year is “mindless austerity”

“I want to work with Congress to replace mindless austerity with smart investments that strengthen America,” Obama said in a speech at the Department of Homeland Security. “I’m not going to accept a budget that locks in sequestration going forward. It would be bad for our security, and bad for our growth.”

Yes, if we steal money from future generations it will artificially inflate our current standard of living and make our economy look temporarily better than it should be.

But it is morally wrong to do this, and our current crop of politicians have no intentions of ever bringing the debt party to an end.

Even with the ridiculously optimistic economic assumptions that are used in Obama’s new budget, the federal budget is never projected to balance within the next decade.  Instead, Obama’s budget projects that the national debt will rise from 18.1 trillion dollars right now to 26.2 trillion dollars in 2025.

Of course it would greatly help if the federal government actually spent our money wisely.  But instead, the feds often waste our hard-earned tax dollars in some of the most bizarre ways imaginable.  The following is just one example

The U.S. federal government has prompted controversy after spending over $33,000 on a study to find out whether same-sex couples live closer to tobacco shops than heterosexuals.

The large sum was spent on a study by the National Institutes of Health entitled, ‘Relationship Between Tobacco Retailer Density and Sexual Minority Couples.’

Thanks to this kind of insane spending, our debt is completely and totally out of control.

While Barack Obama has been in the White House, the U.S. national debt has increased by $84,266 per full-time private sector worker.  Anyone that believes that this kind of debt accumulation is sustainable is absolutely delusional.

The only reason why our house of cards has not completely collapsed already is because the rest of the world has been willing to lend us gigantic piles of money at artificially low interest rates.

In December, the average rate of interest on the government’s marketable debt was 2.013 percent.  But in the past, interest rates have been much higher than that.  For example, in January 2000 the average rate of interest on the government’s marketable debt was 6.620 percent.  If we returned to that level today, we would be paying well over a trillion dollars a year just in interest on the national debt.

And the issue isn’t just the more than one trillion dollars in new debt that we are accumulating every 12 months.

As I have discussed previously, the U.S. government has more than seven trillion dollars of debt that must be “rolled over” each year.  In other words, the federal government must issue more than seven trillion dollars of new debt just to pay off old debts that are coming due.

If something were to happen which would cause the rest of the planet to either be unwilling or unable to lend us trillions of dollars at ridiculously low interest rates all of a sudden, the game would be over.

We were handed the keys to the greatest and most prosperous economy in the history of the planet, and our greed has totally wrecked it.

We were wealthy beyond imagination, but that was never good enough for us.  We always had to have more.

And now we are hurtling toward financial oblivion, and we have a man in the White House that wants us to go into debt even faster.

 

The Federal Reserve Is At The Heart Of The Debt Enslavement System That Dominates Our Lives

The Great Seal Of The United States - A Symbol Of Your Enslavement - Photo by IpankoninFrom the dawn of history, elites have always attempted to enslave humanity.  Yes, there have certainly been times when those in power have slaughtered vast numbers of people, but normally those in power find it much more beneficial to profit from the labor of those that they are able to subjugate.  If you are forced to build a pyramid, or pay a third of your crops in tribute, or hand over nearly half of your paycheck in taxes, that enriches those in power at your expense.  You become a “human resource” that is being exploited to serve the interests of others.  Today, some forms of slavery have been outlawed, but one of the most insidious forms is more pervasive than ever.  It is called debt, and virtually every major decision of our lives involves more of it.  For example, at the very beginning of our adult lives we are pushed to go to college, and Americans have piled up more than 1.2 trillion dollars of student loan debt at this point.  When we buy homes, most Americans get mortgages that they can barely afford, and when we buy vehicles most Americans now stretch their loans out over five or six years.  When we get married, that often means even more debt.  And of course no society on Earth has ever piled up more credit card debt than we have.  Almost all of us are in bondage to debt at this point, and as we slowly pay off that debt over the years we will greatly enrich the elitists that tricked us into going into so much debt in the first place.  At the apex of this debt enslavement system is the Federal Reserve.  As you will see below, it is an institution that is designed to produce as much debt as possible.

There are many people out there that believe that the Federal Reserve is an “agency” of the federal government.  But that is not true at all.  The Federal Reserve is an unelected, unaccountable central banking cartel, and it has argued in federal court that it is “not an agency” of the federal government and therefore not subject to the Freedom of Information Act.  The 12 regional Federal Reserve banks are organized “much like private corporations“, and they actually issue shares of stock to the “member banks” that own them.  100 percent of the shareholders of the Federal Reserve are private banks.  The U.S. government owns zero shares.

Many people also assume that the federal government “issues money”, but that is not true at all either.  Under our current system, what the federal government actually does is borrow money that the Federal Reserve creates out of thin air.  The big banks, the ultra-wealthy and other countries purchase the debt that is created, and we end up as debt servants to them.  For a detailed explanation of how this works, please see my previous article entitled “Where Does Money Come From? The Giant Federal Reserve Scam That Most Americans Do Not Understand“.  When it is all said and done, the elite end up holding the debt instruments and we end up being collectively responsible for the endlessly growing mountain of debt.  Our politicians always promise to get the debt under control, but there is never enough money to both fund the government and pay the interest on the constantly expanding debt.  So it always becomes necessary to borrow even more money.  When it was created back in 1913, the Federal Reserve system was designed to create a perpetual government debt spiral from which it would never be possible to escape, and that is precisely what has happened.

Just look at the chart that I have posted below.  Forty years ago, the U.S. national debt was less than half a trillion dollars.  Today, it has exploded up to nearly 18 trillion dollars…

National Debt

But the national debt is only part of the story.  The big banks which control the Federal Reserve also seek to individually dominate our lives with debt.  We have become a “buy now, pay later” society and the results have been absolutely catastrophic.  40 years ago, the total amount of debt in our system was just a shade over 2 trillion dollars.  Today it is over 57 trillion dollars

Total Debt

The big banks do not loan you money because they want to help you achieve “the American Dream”.  The elitists loan you money because it will make them wealthier.  For example, if you only make the minimum payment on a credit card each month, you will end up paying back several times as much money as you originally borrowed.  It is a very insidious form of debt enslavement that most Americans simply do not understand.

Meanwhile, the Federal Reserve is also systematically destroying the wealth that you already have.  If you try to buck the system and actually save money, the purchasing power of that money is continually being eroded by the Federal Reserve’s inflationary policies.  The following chart comes directly from the Federal Reserve and it shows how the value of the U.S. dollar has plummeted over the past 40 years…

Purchasing Power Of The Dollar

Overall, the U.S. dollar has lost approximately 98 percent of its value since the Fed was first established in 1913.

Most people seem to assume that if we could just send the “right politicians” to Washington D.C. that we could get our economy back on the right track.

What those people do not understand is that our system is fundamentally broken.  We are trapped in a perpetual debt spiral that is destined to end in a horrifying collapse.  Just “tweaking” a few things here or there and adjusting tax rates a bit is not going to fix anything.  The vast majority of the “economic solutions” that our politicians talk about are basically equivalent to rearranging the deck chairs on the Titanic.

And of course the elite don’t want the rest of us to truly understand what is going on.  Just think about it.  Even though the Federal Reserve is one of the most important institutions in our society, and even though it is at the very heart of our economic system, our kids are taught next to nothing about the Fed in school.  The vast majority of them have absolutely no idea where money comes from.

Isn’t that pathetic?

But the elite know that if we did understand what they were doing to us that most of us would start to get very upset.  Henry Ford, the founder of Ford Motor Company, once said the following…

“It is well enough that people of the nation do not understand our banking and money system, for if they did, I believe there would be a revolution before tomorrow morning.”

Please share this article with as many people as you can.  The truth sets people free, so let us do what we can to wake our fellow Americans up to this insidious debt enslavement system which dominates our society.

Half The Country Makes Less Than $27,520 A Year And 15 Other Signs The Middle Class Is Dying

Depressed - Photo by Sander van der WelIf you make more than $27,520 a year at your job, you are doing better than half the country is.  But you don’t have to take my word for it, you can check out the latest wage statistics from the Social Security administration right here.  But of course $27,520 a year will not allow you to live “the American Dream” in this day and age.  After taxes, that breaks down to a good bit less than $2,000 a month.  You can’t realistically pay a mortgage, make a car payment, afford health insurance and provide food, clothing and everything else your family needs for that much money.  That is one of the reasons why both parents are working in most families today.  In fact, sometimes both parents are working multiple jobs in a desperate attempt to make ends meet.  Over the years, the cost of living has risen steadily but our paychecks have not.  This has resulted in a steady erosion of the middle class.  Once upon a time, most American families could afford a nice home, a couple of cars and a nice vacation every year.  When I was growing up, it seemed like almost everyone was middle class.  But now “the American Dream” is out of reach for more Americans than ever, and the middle class is dying right in front of our eyes.

One of the things that was great about America in the post-World War II era was that we developed a large, thriving middle class.  Until recent times, it always seemed like there were plenty of good jobs for people that were willing to be responsible and work hard.  That was one of the big reasons why people wanted to come here from all over the world.  They wanted to have a chance to live “the American Dream” too.

But now the American Dream is becoming a mirage for most people.  No matter how hard they try, they just can’t seem to achieve it.

And here are some hard numbers to back that assertion up.  The following are 15 more signs that the middle class is dying…

#1 According to a brand new CNN poll, 59 percent of Americans believe that it has become impossible for most people to achieve the American Dream…

The American Dream is impossible to achieve in this country.

So say nearly 6 in 10 people who responded to CNNMoney’s American Dream Poll, conducted by ORC International. They feel the dream — however they define it — is out of reach.

Young adults, age 18 to 34, are most likely to feel the dream is unattainable, with 63% saying it’s impossible. This age group has suffered in the wake of the Great Recession, finding it hard to get good jobs.

#2 More Americans than ever believe that homeownership is not a key to long-term wealth and prosperity…

The great American Dream is dying. Even though many Americans still desire to own a home, they are losing faith in homeownership as a key to prosperity.

Nearly two-thirds of Americans, or 64%, believe they are less likely to build wealth by buying a home today than they were 20 or 30 years ago, according to a survey sponsored by non-profit MacArthur Foundation. And nearly 43% said buying a home is no longer a good long-term investment.

#3 Overall, the rate of homeownership in the United States has fallen for eight years in a row, and it has now dropped to the lowest level in 19 years.

#4 52 percent of Americans cannot even afford the house that they are living in right now…

“Over half of Americans (52%) have had to make at least one major sacrifice in order to cover their rent or mortgage over the last three years, according to the “How Housing Matters Survey,” which was commissioned by the nonprofit John D. and Catherine T. MacArthur Foundation and carried out by Hart Research Associates. These sacrifices include getting a second job, deferring saving for retirement, cutting back on health care, running up credit card debt, or even moving to a less safe neighborhood or one with worse schools.”

#5 According to the U.S. Census Bureau, only 36 percent of Americans under the age of 35 own a home.  That is the lowest level that has ever been measured.

#6 Right now, approximately one out of every six men in the United States that are in their prime working years (25 to 54) do not have a job.

#7 The labor force participation rate for Americans from the age of 25 to the age of 29 has fallen to an all-time record low.

#8 The number of working age Americans that are not employed has increased by 27 million since the year 2000.

#9 According to the government’s own numbers, about 20 percent of the families in the entire country do not have a single member that is employed at this point.

#10 This may sound crazy, but 25 percent of all American adults do not even have a single penny saved up for retirement.

#11 As I noted in one recent article, total consumer credit in the United States has increased by 22 percent over the past three years, and 56 percent of all Americans have “subprime credit” at this point.

#12 Major retailers are shutting down stores at the fastest pace that we have seen since the collapse of Lehman Brothers.

#13 It is hard to believe, but more than one out of every five children in the United States is living in poverty in 2014.

#14 According to one recent report, there are 49 million Americans that are dealing with food insecurity right now.

#15 Overall, the U.S. poverty rate is up more than 30 percent since 1966.  It looks like LBJ’s war on poverty didn’t work out too well after all.

Sadly, it does not appear that there is much hope on the horizon for the middle class.  More good jobs are being shipped out of the country and are being lost to technology every single day, and our politicians seem convinced that “business as usual” is the right course of action for our nation.

Unless something dramatic happens, it is going to become increasingly difficult to eke out a middle class existence as a “worker bee” in American society.  The truth is that most big companies these days do not have any loyalty to their workers and really do not care what ends up happening to them.

To thrive in this kind of environment, new and different thinking is required.  The paradigm of “go to college, get a job, stay loyal and retire after 30 years” has been shattered.  The business world is more unstable now than it has been during any point in the post-World War II era, and we are all going to have to adjust.

So what advice would you give to people that are struggling out there right now?  Please feel free to share your thoughts by posting a comment below…

9 Of The Top 10 Occupations In America Pay An Average Wage Of Less Than $35,000 A Year

CashierAccording to stunning new numbers just released by the federal government, nine of the top ten most commonly held jobs in the United States pay an average wage of less than $35,000 a year.  When you break that down, that means that most of these workers are making less than $3,000 a month before taxes.  And once you consider how we are being taxed into oblivion, things become even more frightening.  Can you pay a mortgage and support a family on just a couple grand a month?  Of course not.  In the old days, a single income would enable a family to live a very comfortable middle class lifestyle in most cases.  But now those days are long gone.  In 2014, both parents are expected to work, and in many cases both of them have to get multiple jobs just in order to break even at the end of the month.  The decline in the quality of our jobs is a huge reason for the implosion of the middle class in this country.  You can’t have a middle class without middle class jobs, and we have witnessed a multi-decade decline in middle class jobs in the United States.  As long as this trend continues, the middle class is going to continue to shrink.

The following is a list of the most commonly held jobs in America according to the federal government.  As you can see, 9 of the top 10 most commonly held occupations pay an average wage of less than $35,000 a year

  1. Retail salespersons, 4.48 million workers earning  $25,370
  2. Cashiers  3.34 million workers earning $20,420
  3. Food prep and serving staff, 3.02 million workers earning $18,880
  4. General office clerk, 2.83 million working earning $29,990
  5. Registered nurses, 2.66 million workers earning $68,910
  6. Waiters and waitresses, 2.40 million workers earning $20,880
  7. Customer service representatives, 2.39 million workers earning $33,370
  8. Laborers, and freight and material movers, 2.28 million workers earning $26,690
  9. Secretaries and admins (not legal or medical),  2.16 million workers earning $34,000
  10. Janitors and cleaners (not maids),  2.10 million workers earning, $25,140

Overall, an astounding 59 percent of all American workers bring home less than $35,000 a year in wages.

So if you are going to make more than $35,000 this year, you are solidly in the upper half.

But that doesn’t mean that you will always be there.

More Americans are falling out of the middle class with each passing day.

Just consider the case of a 47-year-old woman named Kristina Feldotte.  Together with her husband, they used to make about $80,000 a year.  But since she lost her job three years ago, their combined income has fallen to about $36,000 a year

Three years ago, Kristina Feldotte, 47, and her husband earned a combined $80,000. She considered herself solidly middle class. The couple and their four children regularly vacationed at a lake near their home in Saginaw, Michigan.

But in August 2012, Feldotte was laid off from her job as a special education teacher. She’s since managed to find only part-time teaching work. Though her husband still works as a truck salesman, their income has sunk by more than half to $36,000.

“Now we’re on the upper end of lower class,” Feldotte said.

There is a common assumption out there that if you “have a job” that you must be doing “okay”.

But that is not even close to the truth.

The reality of the matter is that you can even have two or three jobs and still be living in poverty.  In fact, you can even be working for the government or the military and still need food stamps

Since the start of the Recession, the dollar amount of food stamps used at military commissaries, special stores that can be used by active-duty, retired, and some veterans of the armed forces has quadrupled, hitting $103 million last year. Food banks around the country have also reported a rise in the number of military families they serve, numbers that swelled during the Recession and haven’t, or have barely, abated.

There are so many people that are really hurting out there.

Today, someone wrote to me about one of my recent articles about food price increases and told me about how produce prices were going through the roof in that particular area.  This individual wondered how ordinary families were going to be able to survive in this environment.

That is a very good question.

I don’t know how they are going to survive.

In some cases, the suffering that is going on behind closed doors is far greater than any of us would ever imagine.

And often, it is children that suffer the most

A Texas couple kept their bruised, malnourished 5-year-old son in a diaper and locked in a closet of their Spring home, police said in a horrifying case of abuse.

The tiny, blond-haired boy was severely underweight, his shoulder blades, ribs and vertebrae showing through his skin, when officers found him late last week.

You can see some photos of that poor little boy right here.

I hope that those abusive parents are put away for a very long time.

Sadly, there are lots of kids that are really suffering right now.  There are more than a million homeless schoolchildren in America, and there are countless numbers that will go to bed hungry tonight.

But if you live in wealthy enclaves on the east or west coasts, all of this may sound truly bizarre to you.  Where you live, you may look around and not see any poverty at all.  That is because America has become increasingly segregated by wealth.  Some are even calling this the “skyboxification of America”

The richest Americans—the much-talked about 1 percent—are a cloistered class. As the Nobel Prize-winning economist Joseph Stiglitz scathingly put it, they “have the best houses, the best educations, the best doctors, and the best lifestyles, but there is one thing that money doesn’t seem to have bought: an understanding that their fate is bound up with how the other 99 percent live.” The Harvard political philosopher Michael Sandel has similarly lamented the “skyboxification” of American life, in which “people of affluence and people of modest means lead increasingly separate lives.”

The substantial and growing gap between the rich and everyone else is increasingly inscribed on our geography. There have always been affluent neighborhoods, gated enclaves, and fabled bastions of wealth like Greenwich, Connecticut; Grosse Pointe, Michigan; Potomac, Maryland; and Beverly Hills, California. But America’s bankers, lawyers, and doctors didn’t always live so far apart from teachers, accountants, and small business owners, who themselves weren’t always so segregated from the poorest, most struggling Americans.

Nobody should talk about an “economic recovery” until the middle class starts growing again.

Even as the stock market has soared to unprecedented heights over the past year, the decline of middle class America has continued unabated.

And most Americans know deep inside that something is deeply broken.  For example, a recent CNBC All-America Economic Survey found that over 80 percent of all Americans consider the economy to be “fair” or “poor”.

Yes, for the moment things are going quite well for the top 10 percent of the nation, but that won’t last long either.  None of the problems that caused the last great financial crisis have been fixed.  In fact, they have gotten even worse.  We are steamrolling toward another great financial crisis and our leaders are absolutely clueless.

When the next crisis strikes, the economic suffering in this nation is going to get even worse.

As bad as things are now, they are not even worth comparing to what is coming.

So I hope that you are getting prepared.  Time is running out.

 

29-Year-Old Welfare Parasite Would Not Accept An $80,000 A Year Job Driving A Truck

Truck North DakotaWhat should be done with a 29-year-old welfare parasite that believes that in addition to practicing with his rock band, his main job in life is to “make sure the sun’s up and the girls are out”?  Most people that receive government assistance truly need the help and do not abuse the system, but there are definitely others that do abuse the system and do not make any excuses for doing so.  When 29-year-old Jason Greenslate was recently asked if he would be willing to take a job driving a truck in North Dakota for $80,000 a year, he said that he would not.  He would rather keep purchasing sushi and lobster with his EBT card and hanging out with his rock band.  Greenslate seems very happy with his taxpayer-funded lifestyle, and he says that he wants “to thank the United States of America, and the situation — the way things are set up”.  Is this really what we pay taxes for?  The rest of us are taxed into oblivion so that we can fund the endless partying of parasites like Jason Greenslate?  What in the world is happening to this country?

If you have never heard of Jason Greenslate, let me get you caught up by quoting the article that I wrote about him last year

When he was asked if he ever had any interest in actually getting a job, his response was “not whatsoever“.  Instead, he says that his job is to “make sure the sun’s up and the girls are out” and he would rather spend his days partying.  Of course every American should be free to live their own lives as they see fit, but the problem is that Jason Greenslate is using food stamps to help support his lifestyle.  In fact, he took Fox News into the gourmet section of a local supermarket where he purchased sushi and lobster with his EBT card.  Sadly, he is just like millions of other young men in America today that seemingly have had the drive to succeed and to be independent totally sucked out of them.  But what is the future of America going to look like if we continue to produce millions upon millions of young men that have absolutely no desire to make a living, get married and start a family?

Just recently, Sean Hannity had Greenslate on his program and asked him if he felt bad that his fellow Californians are being taxed at extremely high levels in order to pay for his lifestyle.   Sadly, this does not appear to bother Greenslate.  The following is from a recent Fox News article

Hannity pointed out that Greenslate rides around in a Cadillac Escalade and frequents strip clubs, all while receiving government assistance and not working at a job that actually pays.

When Hannity asked Greenslate who he thinks pays for his food stamps and free health care, Greenslate said, “Government, taxes, us, the people.”

“Not you, because you’re not paying taxes,” Hannity responded.

Hannity went on to point out that nearly 60 cents out of every working Californian’s dollar goes to taxes. “You’re taking their money and you just don’t seem to care,” Hannity said.

“Who says I don’t care?” Greenslate asked, adding that he was “thankful.”

Hannity even asked Greenslate if he would take a job as a truck driver for $80,000 a year, and Greenslate refused

Hannity went for broke: “If I could get you a job that would pay you $80,000 a year driving a truck in North Dakota, would you take it?

Greenslate paused for a moment to think about it: “No.

Of course most Americans actually do want to work, and only go on government assistance if they really need it.  Unfortunately, however, there are a lot of “Jason Greenslates” out there, and their numbers are growing with each passing year.

And without a doubt, life is tough if you are trying to survive at the low end of the wage scale these days.  It is hard enough to take care of yourself, much less an entire family, on 9 or 10 dollars an hour.

For many, it is simply easier to give up on working for a living and depend on the government instead.

Not that it is easy to find any kind of work these days.  The percentage of low wage jobs in our economy has steadily risen, and the competition for those jobs can be very intense.  Large numbers of college-educated workers are now finding themselves forced to apply for low wage jobs, and this is forcing many less educated workers out of the labor force entirely.  The following comes from a recent CNBC article

Today’s low-wage workers are also more educated, with 41 percent having at least some college, up from 29 percent in 2000. “Minimum-wage and low-wage workers are older and more educated than 10 or 20 years ago, yet they’re making wages below where they were 10 or 20 years ago after inflation,” said Mr. Schmitt, senior economist at the research center. “If you look back several decades, workers near the minimum wage were more likely to be teenagers—that’s the stereotype people had. It’s definitely not accurate anymore.”

But when many college-educated professionals start working these sorts of jobs, they find that they require extremely hard work.

For example, posted below is an excerpt from an article entitled “My Life as a Retail Worker: Nasty, Brutish, and Poor” by reporter Joseph Williams.  Let’s just say that he didn’t really care for his time working in retail after he unexpectedly lost his job…

It didn’t matter if it was at the beginning of my shift, if the store was empty, or if my knees, back, and feet ached from hours of standing. Park your behind while on the clock, went the unspoken rule, and you might find it on a park bench scanning the want-ads for a new job.

Another quick observation: Working in retail takes more skill than just selling stuff. Besides the mindless tasks one expects—folding, stacking, sorting, fetching things for customers—I frequently had to tackle a series of housekeeping chores that Stretch never mentioned in our welcome-aboard chat. Performed during the late shift, those chores usually meant I’d have to stay well past the scheduled 9 p.m. quitting time.

Mop the floors in the bathroom, replace the toilet paper and scrub the toilets if necessary. Vacuum. Empty the garbage. Wipe down the glass front doors, every night, even if they don’t really need it.

Yes, working in retail can be physically, mentally and emotionally exhausting.

I know this from personal experience.  In my younger years, I worked a number of retail jobs.

But nobody should be afraid of a little hard work.

That is what built America.

If you do have a job, you should be thankful.  The truth is that there are millions of Americans out there that would do just about anything for a decent job at this point.

Of course the U.S. economy should be doing better that it is right now.  I truly wish that it was like the good old days when any hard working person could easily find a decent job.  Thanks to decades of incredibly foolish decisions by our leaders, those days are permanently gone.

And if you think that things are bad now, just wait.  The U.S. economy is already heading toward another recession, and the next great financial crisis is rapidly approaching.

So let us enjoy this period of relative stability while we can.

Very soon, millions more Americans will be losing their jobs and the number of people that actually need government assistance is going to go even higher.

100 Years Old And Still Killing Us: America Was Much Better Off Before The Income Tax

100 Years Old And Still Killing UsDid you know that the greatest period of economic growth in American history was during a time when there was absolutely no federal income tax?  Between the end of the Civil War and 1913, there was an explosion of economic activity in the United States unlike anything ever seen before or since.  Unfortunately, a federal income tax was instituted in 1913, and this year it turned 100 years old.  But there was no fanfare, was there?  There was no celebration because the federal income tax is universally hated.  Sadly, most Americans just assume that there is no other option to an income tax.  Most Americans just assume that it has always been with us and that it will always be with us.  This year, the American people will shell out approximately $4.22 trillion in state and federal income taxes.  That amount is equivalent to approximately 29.4 percent of all income that Americans will bring in this year, and that does not even take into account the dozens of other taxes that Americans pay each year.  At this point, the U.S. tax code is about 13 miles long, and those that are honest and pay their taxes every year are being absolutely shredded by this system.  But wouldn’t the federal government go broke if we didn’t have a federal income tax?  No, actually the truth is that the federal government did just fine before there was an income tax.  In fact, the U.S. national debt has gotten more than 5000 times larger since the federal income tax and the Federal Reserve were created by Congress back in 1913.  As I have written about previously, the Federal Reserve system was actually designed to trap the United States in a debt spiral from which it could never possibly escape, and the federal income tax was needed to greatly expand the size of the federal government and to soak the American people of the funds necessary to service that debt.  But it doesn’t have to be this way.  America was once much better off before the income tax and the Federal Reserve were created, and we could easily go to such a system again.

What we desperately need to do is to teach the American people a little history lesson.  The truth is that the greatest period of economic growth in U.S. history was between the Civil War and 1913 when there was no federal income tax at all.  The following is from Wikipedia

The Gilded Age saw the greatest period of economic growth in American history. After the short-lived panic of 1873, the economy recovered with the advent of hard money policies and industrialization. From 1869 to 1879, the US economy grew at a rate of 6.8% for real GDP and 4.5% for real GDP per capita, despite the panic of 1873.  The economy repeated this period of growth in the 1880s, in which the wealth of the nation grew at an annual rate of 3.8%, while the GDP was also doubled.

Sadly, most Americans cannot even conceive of an economy like that.  Most Americans cannot even imagine having a nation without a massively bloated federal government and without an unelected central bank centrally planning our financial system.

But you know what?

It worked.  In fact, it worked fantastically well.

The period between the Civil War and 1913 propelled the United States to greatness.  Just check out all of the good things that Wikipedia says happened for the U.S. economy during those years…

The rapid economic development following the Civil War laid the groundwork for the modern U.S. industrial economy. By 1890, the USA leaped ahead of Britain for first place in manufacturing output.

An explosion of new discoveries and inventions took place, a process called the “Second Industrial Revolution.” Railroads greatly expanded the mileage and built stronger tracks and bridges that handled heavier cars and locomotives, carrying far more goods and people at lower rates. Refrigeration railroad cars came into use. The telephone, phonograph, typewriter and electric light were invented. By the dawn of the 20th century, cars had begun to replace horse-drawn carriages.

Parallel to these achievements was the development of the nation’s industrial infrastructure. Coal was found in abundance in the Appalachian Mountains from Pennsylvania south to Kentucky. Oil was discovered in western Pennsylvania; it was mainly used for lubricants and for kerosene for lamps. Large iron ore mines opened in the Lake Superior region of the upper Midwest. Steel mills thrived in places where these coal and iron ore could be brought together to produce steel. Large copper and silver mines opened, followed by lead mines and cement factories.

In 1913 Henry Ford introduced the assembly line, a step in the process that became known as mass-production.

But if we didn’t have an income tax, how did we fund the government?  Well, we mostly did it with tariffs and excise taxes.  The following is from a recent article by Thomas R. Eddlem

Prior to ratification of the 16th (income tax) Amendment in February 1913, the federal government managed its few constitutional responsibilities without an income tax, except during the Civil War period. During peacetime, it did so largely — or even entirely — on import taxes called “tariffs.” Congress could afford to run the federal government on tariffs alone because federal responsibilities did not include welfare programs, agricultural subsidies, or social insurance programs like Social Security or Medicare. After the Civil War, tariff revenues sometimes suffered under a protectionist policy ushered in by the Republican Party that supplemented federal income via excises on alcohol, tobacco, and inheritances. But before the war, the need for tariff revenue to finance the federal government generally kept the tariff at reasonable levels. During wartime throughout early American history, the Founding Fathers were able to raise additional revenue employing a different method of direct taxation authorized by the U.S. Constitution prior to the 16th Amendment. These alternative taxing methods gave the young American nation embarrassing peacetime budget surpluses that several times came close to paying off the national debt.

So why didn’t we stick with that system?

Well, early in the 20th century the “progressives” and the social planners started to take control in Washington.

And one of the things that “progressives” and social planners love is an income tax.  In fact, the second plank of the Communist Manifesto is a “heavy progressive or graduated income tax”.

Of course they promised us that income tax rates would always remain low.  And at first they were quite low.  The following is from an article by Adam Young

The presidential election of 1912 was contested between three advocates of an income tax. The winner, Woodrow Wilson, after the ratification of the Sixteenth Amendment, called a special session of Congress in April 1913, which proceeded to pass an income tax of 1% on incomes above $3,000 and applied surcharges between 2% and 7% on income from $20,000 to $500,000.

But once the “progressives” and the social planners get their feet in the door, they always want more.

And we have seen how things have worked out.  Today, the American people are being taxed into oblivion.

In a previous article entitled “Show This To Anyone That Believes That Taxes Are Too Low“, I listed dozens of other taxes that the American people pay each year in addition to federal and state income taxes…

#1 Building Permit Taxes

#2 Capital Gains Taxes

#3 Cigarette Taxes

#4 Court Fines (indirect taxes)

#5 Dog License Taxes

#6 Drivers License Fees (another form of taxation)

#7 Federal Unemployment Taxes

#8 Fishing License Taxes

#9 Food License Taxes

#10 Gasoline Taxes

#11 Gift Taxes

#12 Hunting License Taxes

#13 Inheritance Taxes

#14 Inventory Taxes

#15 IRS Interest Charges (tax on top of tax)

#16 IRS Penalties (tax on top of tax)

#17 Liquor Taxes

#18 Luxury Taxes

#19 Marriage License Taxes

#20 Medicare Taxes

#21 Medicare Tax Surcharge On High Earning Americans Under Obamacare

#22 Obamacare Individual Mandate Excise Tax (if you don’t buy “qualifying” health insurance under Obamacare you will have to pay an additional tax)

#23 Obamacare Surtax On Investment Income (a new 3.8% surtax on investment income that goes into effect next year)

#24 Property Taxes

#25 Recreational Vehicle Taxes

#26 Toll Booth Taxes

#27 Sales Taxes

#28 Self-Employment Taxes

#29 School Taxes

#30 Septic Permit Taxes

#31 Service Charge Taxes

#32 Social Security Taxes

#33 State Unemployment Taxes (SUTA)

#34 Tanning Tax (a new Obamacare tax on tanning services)

#35 Telephone Federal Excise Taxes

#36 Telephone Federal Universal Service Fee Taxes

#37 Telephone Minimum Usage Surcharge Taxes

#38 Telephone State And Local Taxes

#39 Tire Taxes

#40 Tolls (another form of taxation)

#41 Traffic Fines (indirect taxation)

#42 Utility Taxes

#43 Vehicle Registration Taxes

#44 Workers Compensation Taxes

Yet even with all of these taxes, our local governments, our state governments and our federal government are all absolutely drowning in debt.

In another previous article entitled “24 Outrageous Facts About Taxes In The United States That Will Blow Your Mind“, I listed a number of reasons why our federal income tax system has become a complete and utter abomination that can never be fixed…

1 – The U.S. tax code is now 3.8 million words long.  If you took all of William Shakespeare’s works and collected them together, the entire collection would only be about 900,000 words long.

2 – According to the National Taxpayers Union, U.S. taxpayers spend more than 7.6 billion hours complying with federal tax requirements.  Imagine what our society would look like if all that time was spent on more economically profitable activities.

3 – 75 years ago, the instructions for Form 1040 were two pages long.  Today, they are 189 pages long.

4 – There have been 4,428 changes to the tax code over the last decade.  It is incredibly costly to change tax software, tax manuals and tax instruction booklets for all of those changes.

5 – According to the National Taxpayers Union, the IRS currently has 1,999 different publications, forms, and instruction sheets that you can download from the IRS website.

6 – Our tax system has become so complicated that it is almost impossible to file your taxes correctly.  For example, back in 1998 Money Magazine had 46 different tax professionals complete a tax return for a hypothetical household.  All 46 of them came up with a different result.

7 – In 2009, PC World had five of the most popular tax preparation software websites prepare a tax return for a hypothetical household.  All five of them came up with a different result.

8 – The IRS spends $2.45 for every $100 that it collects in taxes.

9 – According to The Tax Foundation, the average American has to work until April 17th just to pay federal, state, and local taxes.  Back in 1900, “Tax Freedom Day” came on January 22nd.

10 – When the U.S. government first implemented a personal income tax back in 1913, the vast majority of the population paid a rate of just 1 percent, and the highest marginal tax rate was just 7 percent.

11 – Residents of New Jersey pay $1.64 in taxes for every $1.00 of federal spending that they get back.

12 – The United States is the only nation on the planet that tries to tax citizens on what they earn in foreign countries.

13 – According to Forbes, the 400 highest earning Americans pay an average federal income tax rate of just 18 percent.

14 – Warren Buffett had an effective tax rate of just 17.4 percent for 2010.

15 – The top 20 percent of all income earners in the United States pay approximately 86 percent of all federal income taxes.

16 – Sadly, as Bill Whittle has shown, you could take every single penny that every American earns above $250,000 and it would only fund about 38 percent of the federal budget.

17 – The United States has the highest corporate tax rate in the world (35 percent).  In Ireland, the corporate tax rate is only 12.5 percent.  This is causing thousands of corporations to move operations out of the United States and into other countries.

18 – Some tax havens are doing a booming business in setting up sham headquarters for U.S. corporations.  For example, the city of Zug, Switzerland only has a population of 26,000 people but it is the headquarters for 30,000 companies.

19 – In 1950, corporate taxes accounted for about 30 percent of all federal revenue.  In 2012, corporate taxes will account for less than 7 percent of all federal revenue.

The wealthy have become absolute masters at avoiding taxes, and the poor are not able to pay much.

So who always gets squeezed?

The middle class does.

No matter what our politicians promise us, the hammer is always brought down on the middle class.

And now, according to The Huffington Post, the IRS says that it can even read our old emails without a warrant to make sure that we are paying all of the taxes that we should be…

The IRS apparently interprets that authority very broadly, the documents show: as long as you’ve stored your email in a cloud service like Google Mail, and as long as those emails haven’t been deleted after a few months, the agency thinks it doesn’t need a warrant to read them.

The idea of IRS agents poking through your email account might sound at the very least creepy, and maybe unconstitutional. But the IRS does have a legal leg to stand on: the Electronic Communications Privacy Act of 1986 allows government agencies to in many cases obtain emails older than 180 days without a warrant.

That’s why an internal 2009 IRS document claimed that “the government may obtain the contents of electronic communication that has been in storage for more than 180 days” without a warrant.

It should be noted that the IRS is claiming that it does not use emails “to target” specific taxpayers, but notice that they are not promising not to use old emails against taxpayers once they are officially being audited or investigated…

“Contrary to some suggestions, the IRS does not use emails to target taxpayers. Any suggestion to the contrary is wrong.”

In any event, the truth is that we have one of the most complicated and one of the most intrusive tax systems in the history of the world.

Don’t the American people deserve better?

What do you think?

Should America go back to a system where there is no income tax and no Federal Reserve?

Please feel free to share what you think by leaving a comment below…

America Is Broke

Consumer Spending Drought: 16 Signs That The Middle Class Is Running Out Of Money

Drought - Photo by Bert KaufmannIs “discretionary income” rapidly becoming a thing of the past for most American families?  Right now, there are a lot of signs that we are on the verge of a nightmarish consumer spending drought.  Incomes are down, taxes are up, many large retail chains are deeply struggling because of the lack of customers, and at this point nearly a quarter of all Americans have more credit card debt than money in the bank.  Considering the fact that consumer spending is such a large percentage of the U.S. economy, that is very bad news.  How will we ever have a sustained economic recovery if consumers don’t have much money to spend?  Well, the truth is that we aren’t ever going to have a sustained economic recovery.  In fact, this debt-fueled bubble of false hope that we are experiencing right now is as good as things are going to get.  Things are going to go downhill from here, and if you think that consumer spending is bad now, just wait until you see what happens over the next several years.

Even though the Dow is surging toward a record high right now, everyone knows that things are not good for the middle class.  A recent quote from CPA Howard Dvorkin kind of summarizes our current state of affairs very nicely…

“The fact of the matter is that America is broke — whether it’s mortgages, student loans or credit cards, we are broke. The old rule of thumb is that people should have six months’ of savings,” Dvorkin says.”If you talk to people, most don’t have two pennies.”

These days most Americans are living from paycheck to paycheck, and thanks to rising prices and rising taxes, those paychecks are getting squeezed tighter and tighter.  Many families have had to cut back on unnecessary expenses, and some families no longer have any discretionary income at all.

The following are 16 signs that the middle class is rapidly running out of money…

#1 According to one brand new survey, 24 percent of all Americans have more credit card debt than money in the bank.

#2 J.C. Penney was once an unstoppable retail powerhouse, but now J.C. Penney has just posted its lowest annual retail sales in more than 20 years

J.C. Penney Co. (JCP) slid the most in more than three decades after the department-store chain lost $4.3 billion in sales in the first year of Chief Executive Officer Ron Johnson’s turnaround plan.

The shares fell 18 percent to $17.40 at 11:28 a.m. in New York after earlier declining 22 percent, the biggest intraday drop since at least 1980, according to data compiled by Bloomberg. J.C. Penney yesterday said its net loss in the quarter ended Feb. 2 widened to $552 million from $87 million a year earlier. The Plano, Texas-based retailer’s annual revenue slid 25 percent to $13 billion, the lowest since at least 1987.

How much worse can things get?  At this point the decline has become so steep for J.C. Penney that Jim Cramer of CNBC is declaring that they are in “a true tailspin“.

#3 In the United States today, a new car has become out of reach for most middle class Americans according to the 2013 Car Affordability Study

Looking to buy a new car, truck or crossover? You may find it more difficult to stretch the household budget than you expected, according to a new study that finds median-income families in only one major U.S. city actually can afford the typical new vehicle.

The typical new vehicle is now more expensive than ever, averaging $30,500 in 2012, according to TrueCar.com data, and heading up again as makers curb the incentives that helped make their products more affordable during the recession when they were desperate for sales. According to the 2013 Car Affordability Study by Interest.com, only in Washington could the typical household swing the payments, the median income there running $86,680 a year.

#4 The founder of Subway Restaurants, Fred Deluca, says that the recent tax increases are having a noticeable impact on his business…

“The payroll tax is affecting sales. It’s causing sales declines,” he said, estimating a decline of about 2 percentage points off sales at his restaurants. “There are a lot of pressures on consumers,” Deluca said, adding “I think this is on the permanent side, but I think business will adjust to it.”

#5 Many other large restaurant chains are also struggling in this tough economic environment…

Darden Restaurants, which owns the casual dining chains Oliver Garden, LongHorn Steakhouse and Red Lobster, said blended same-store sales at its three eateries would be 4.5 percent lower during its fiscal third quarter.

Clarence Otis, Darden’s chairman and chief executive, said that “while results midway through the third quarter were encouraging, there were difficult macro-economic headwinds during the last month of the quarter.”

“Two of the most prominent were increased payroll taxes and rising gasoline prices, which together put meaningful pressure on the discretionary purchasing power of our guests,” he added.

#6 The CFO of Family Dollar recently admitted to CNBC that this is a “challenging time” because of reduced consumer spending…

At Family Dollar where the average customer makes less than $40,000 a year, the combination of a two-percent hike in the payroll tax, rising gas prices and delayed tax refunds has created a “challenging time and an uncertain time for the consumer right now,” said Mary Winston, the company’s chief financial officer.

“In our case, anything that takes money out of our customer’s wallet gives them less money to spend in our stores,” she told CNBC. “So I think all of those things create nervousness for the consumer, and I think there are sometimes political dynamics going on that they might not even fully understand the details, but they know it’s not good.”

#7 Even Wal-Mart is really struggling right now.  According to a recent Bloomberg article, Wal-Mart is struggling “to restock store shelves as U.S. sales slump“…

Evelin Cruz, a department manager at the Wal-Mart Supercenter in Pico Rivera, California, said Simon’s comments from the officers’ meeting were “dead on.”

“There are gaps where merchandise is missing,” Cruz said in a telephone interview. “We are not talking about a couple of empty shelves. This is throughout the store in every store. Some places look like they’re going out of business.”

This all comes on the heels of an internal Wal-Mart memo that was leaked to the press earlier this month that described February sales as a “total disaster”.

#8 Electronics retailer Best Buy continues to struggle mightily.  Best Buy just announced that it will be eliminating 400 jobs at its headquarters in Richfield, Minnesota.

#9 It is being projected that many of the largest retail chains in America, including Best Buy, will close down hundreds of stores during 2013.  The following is a list of projected store closings for 2013 that I included in a previous article

Best Buy

Forecast store closings: 200 to 250

Sears Holding Corp.

Forecast store closings: Kmart 175 to 225, Sears 100 to 125

J.C. Penney

Forecast store closings: 300 to 350

Office Depot

Forecast store closings: 125 to 150

Barnes & Noble

Forecast store closings: 190 to 240, per company comments

Gamestop

Forecast store closings: 500 to 600

OfficeMax

Forecast store closings: 150 to 175

RadioShack

Forecast store closings: 450 to 550

#10 Another sign that consumer spending is slowing down is the fact that less stuff is being moved around in our economy.   As I have mentioned previously, freight shipment volumes have hit their lowest level in two years, and freight expenditures have gone negative for the first time since the last recession.

#11 Many young adults have no discretionary income to spend because they are absolutely drowning in student loan debt.  According to the New York Federal Reserve, student loan debt nearly tripled between 2004 and 2012.

#12 The student loan delinquency rate in the United States is now at an all-time high.  It is only a matter of time before the student loan debt bubble bursts.

#13 Due to a lack of jobs and high levels of debt, poverty among young adults in America is absolutely exploding.  Today, U.S. families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.

#14 According to one recent survey, 62 percent of all middle class Americans say that they have had to reduce household spending over the past year.

#15 Median household income in the United States has fallen for four consecutive years.  Overall, it has declined by more than $4000 during that time span.

#16 According to the U.S. Census Bureau, the middle class is currently taking home a smaller share of the overall income pie than has ever been recorded before.

Are you starting to get the picture?

Retailers are desperate for sales, but you can’t squeeze blood out of a rock.

For much more on how the middle class is absolutely drowning in debt, please see this article: “Money Is A Form Of Social Control And Most Americans Are Debt Slaves“.

But if you listen to the mainstream media, they would have you believe that happy days are here again.

Right now, everyone seems to be quite giddy about the fact that the Dow is marching toward an all-time high.  And I actually do believe that the Dow will blow right past it.  In fact, it is even possible that we could see the Dow hit 15,000 before everything starts falling apart.

But at some point, the financial markets will catch up with economic reality.  It is just a matter of time.

In the meanwhile, those that are wise are taking advantage of these times of plenty to prepare for the great economic drought that is coming.

Don’t be caught living paycheck to paycheck and totally unprepared when the next wave of the economic collapse strikes.  Anyone that believes that this debt-fueled bubble of false hope can last indefinitely is just being delusional.

During The Years Of Plenty, Prepare For The Years Of Drought - Photo Taken By Tomas Castelazo

Abolish The Income Tax: You Won’t Believe Who Is Getting Away With Paying Zero Taxes While The Middle Class Gets Hammered

Abolish The Income Tax - You Won't Believe Who Is Getting Away With Paying Zero Taxes While The Middle Class Gets Hammered - Photo by TravisThe federal income tax is a bad joke and it needs to be abolished.  All over the nation, hard working American families are being absolutely crushed by oppressive levels of taxation, and our politicians are constantly coming up with new ways to extract money from all of us every single year.  Meanwhile, many ultra-wealthy Americans and many of the most profitable corporations in the country pay little to nothing in taxes.  In fact, as you will see below, there are dozens of very prominent corporations that make billions of dollars in profits and yet don’t pay a dime in taxes.  Tax avoidance has become a multi-billion dollar industry in the United States.  Those that have the resources to “play the game” use shell companies, offshore tax havens and the thousands of loopholes in our tax code to minimize their tax burdens as much as possible.  Meanwhile, the rest of us get absolutely hammered.  This is fundamentally unfair.  The federal income tax system is irreversibly broken at this point, and it is time to abolish it.  If you think that the federal income tax system can be “fixed”, then you probably have never studied it.  Our tax code is nearly 4 million words long and it is absolutely riddled with thousands of loopholes that favor big corporations and the ultra-wealthy.  We should come up with a better, fairer way to fund the government.  The United States once prospered greatly without a federal income tax, and it could do so again.

Many people simply do not believe that it is possible for corporations inside the United States to make billions of dollars in profits each year and not pay a dime in income taxes.

Well, according to a report put out by Public Campaign, that is exactly what is happening.  Posted below are numbers that come directly from their report.  30 large corporations are listed, and 29 of them had a tax burden for 2008 through 2010 that was less than zero even though they all made enormous profits.  And all 30 of them spent more on lobbying than they did on taxes.

The numbers that you are about to see are for 2008, 2009 and 2010 combined.  For “taxes paid”, please note that for 29 of the corporations a negative number is given.  That means that the net tax liability for 2008 through 2010 was actually less than zero.

After seeing these numbers, is there anyone out there that is still willing to claim that our tax system is “fair”?…

General Electric
U.S. Profits: $10,460,000,000
Taxes Paid: ‐$4,737,000,000

PG&E Corp.
U.S. Profits: $4,855,000,000
Taxes Paid: ‐$1,027,000,000

Verizon Communications
U.S. Profits: $32,518,000,000
­Taxes Paid: ‐$951,000,000

Wells Fargo
U.S. Profits: $49,370,000,000
­Taxes Paid: ‐$681,000,000

American Electric Power
U.S. Profits: $5,899,000,000
­Taxes Paid: ‐$545,000,000

Pepco Holdings
U.S. Profits: $882,000,000
­Taxes Paid: ‐$508,000,000

Computer Sciences
U.S. Profits: $1,666,000,000
Taxes Paid: ‐$305,000,000

CenterPoint Energy
U.S. Profits: $1,931,000,000
Taxes Paid: ‐$284,000,000

NiSource
U.S. Profits: $1,385,000,000
­Taxes Paid: ‐$227,000,000

Duke Energy
U.S. Profits: $5,475,000,000
­Taxes Paid: ‐$216,000,000

Boeing
U.S. Profits: $9,735,000,000
Taxes Paid: ‐$178,000,000

NextEra Energy
U.S. Profits: $6,403,000,000
­Taxes Paid: ‐$139,000,000

Consolidated Edison
U.S. Profits: $4,263,000,000
­Taxes Paid: ‐$127,000,000

Paccar
U.S. Profits: $365,000,000
­Taxes Paid: ‐$112,000,000

Integrys Energy Group
U.S. Profits: $818,000,000
Taxes Paid: ‐$92,000,000

Wisconsin Energy
U.S. Profits: $1,725,000,000
Taxes Paid: ‐$85,000,000

DuPont
U.S. Profits: $2,124,000,000
Taxes Paid: ‐$72,000,000

Baxter International
U.S. Profits: $926,000,000
­Taxes Paid: ‐$66,000,000

Tenet Healthcare
U.S. Profits: $415,000,000
Taxes Paid: ‐$48,000,000

Ryder System
U.S. Profits: $627,000,000
­Taxes Paid: ‐$46,000,000

El Paso
U.S. Profits: $4,105,000,000
­Taxes Paid: ‐$41,000,000

Honeywell International
U.S. Profits: $4,903,000,000
­Taxes Paid: ‐$34,000,000

CMS Energy
U.S. Profits: $1,292,000,000
­Taxes Paid: ‐$29,000,000

Con-­way
U.S. Profits: $286,000,000
Taxes Paid: ‐$26,000,000

Navistar International
U.S. Profits: $896,000,000
­Taxes Paid: ‐$18,000,000

DTE Energy
U.S. Profits: $2,551,000,000
­Taxes Paid: ‐$17,000,000

Interpublic Group
U.S. Profits: $571,000,000
­Taxes Paid: ‐$15,000,000

Mattel
U.S. Profits: $1,020,000,000
­Taxes Paid: ‐$9,000,000

Corning
U.S. Profits: $1,977,000,000
­Taxes Paid: ‐$4,000,000

FedEx
U.S. Profits: $4,247,000,000
Taxes Paid: $37,000,000 (a rate of less than 1%)

Total
U.S. Profits: $163,691,000,000
­Taxes Paid: ‐$10,602,000,000

Just look at that combined total again.

Those 30 companies had combined profits of more than 163 billion dollars during those three years, and yet the combined net tax liability of those companies was negative 10.6 billion dollars.

I wish I could make my taxes look like that.

Another company that is making headlines because of their taxes these days is Facebook.

It turns out that Facebook made more than a billion dollars in 2012 but did not pay a single dime in federal or state income taxes.  The following is from a report that was just released by Citizens for Tax Justice

Earlier this month, the Facebook Inc. released its first “10-K” annual financial report since going public last year. Hidden in the report’s footnotes is an amazing admission: despite $1.1 billion in U.S. profits in 2012, Facebook did not pay even a dime in federal and state income taxes.

Instead, Facebook says it will receive net tax refunds totaling $429 million.

According to Businessweek, Facebook has an additional 2 billion dollars in tax credits that it will be able to use in future years…

Facebook says that it anticipates reducing its tax liability in the future by an additional $2.17 billion by using further net operating loss carry-forwards that it has banked.

And of course when it comes to abusing the tax system, the big Wall Street banks are some of the worst offenders.  The following is an excerpt from a report put out by the office of U.S. Senator Bernie Sanders

—–

Here are just a few examples of how the corporations and Wall Street banks these CEOs work for have significantly harmed our economy and the federal budget:

1. Bank of America CEO Brian Moynihan

Number of Offshore Tax Havens in 2010? 371.

In 2010, Bank of America operated 371 subsidiaries incorporated in offshore tax havens. 204 of these subsidiaries are incorporated in the Cayman Islands, which has a corporate tax rate of 0%.

Amount of federal income taxes Bank of America would have owed if offshore tax havens were eliminated? $2.5 billion.

Bank of America has stashed $18.5 billion in offshore tax havens to avoid paying U.S. income taxes. Bank of America would owe an estimated $2.5 billion in federal income taxes if its use of offshore tax avoidance was eliminated.

Amount of federal income taxes paid in 2010? Zero. $1.9 billion tax refund.

Bank of America received a $1.9 billion tax refund from the IRS in 2010, even though it made $4.4 billion in profits.

Taxpayer Bailout from the Federal Reserve and the Treasury Department? Over $1.3 trillion.

During the financial crisis, Bank of America received a total of more than $1.3 trillion in virtually zero interest loans from the Federal Reserve and a $45 billion bailout from the Treasury Department.

2. JP Morgan Chase CEO James Dimon

Number of Offshore Tax Havens in 2010? 83.

In 2010, JP Morgan Chase operated 83 subsidiaries incorporated in offshore tax havens.

Amount of federal income taxes JP Morgan Chase would have owed if offshore tax havens were eliminated? $4.9 billion

JP Morgan Chase has stashed $21.8 billion in offshore tax haven countries to avoid payng income taxes. If this practice was outlawed, it would have paid $4.9 billion in federal income taxes.

Taxpayer Bailout from the Federal Reserve and the Treasury Department? $416 billion

During the financial crisis, JP Morgan Chase received a total of more than $391 billion in virtually zero interest loans from the Federal Reserve and a $25 billion bailout from the Treasury Department, while Jamie DImon served as a director of the New York Federal Reserve.

3. Goldman Sachs CEO Lloyd Blankfein

Amount of federal income taxes paid in 2008? Zero. $278 million tax refund.

In 2008, Goldman Sachs received a $278 million refund from the IRS, even though it earned a profit of $2.3 billion that year.

Number of offshore tax havens in 2010? 39.

In 2010, Goldman Sachs operated 39 subsidiaries in offshore tax haven countries.

Amount of federal income taxes Goldman Sachs would have owed if offshore tax havens were eliminated? $3.32 billion.

Goldman Sachs has stashed $20.63 billion in offshore tax haven countries to avoid paying income taxes. If this practice was outlawed, it would have paid $3.32 billion in federal income taxes.

Taxpayer Bailout from the Federal Reserve and the Treasury Department? $824 billion.

During the financial crisis, Goldman Sachs received a total of $814 billion in virtually zero interest loans from the Federal Reserve and a $10 billion bailout from the Treasury Department.

—–

Are you starting to get the picture?

The big banks and the big corporations make billions, but they pay nothing or next to nothing.

The rest of us bust our rear ends to try to get ahead, and we get gouged by dozens of different taxes.

Over time, the percentage of the overall tax burden shouldered by corporations has gotten smaller and smaller.

Back in 1950, corporate taxes accounted for about 30 percent of all federal revenue.  In 2012, corporate taxes accounted for less than 7 percent of all federal revenue.

These days, large corporations have become absolute masters at avoiding taxes.  In fact, there are many international tax havens that are doing a booming business in setting up sham headquarters for U.S. corporations.  For example, the city of Zug, Switzerland only has a population of 26,000 people but it is the headquarters for 30,000 companies.

But corporations are not the only ones doing this kind of thing.

The ultra-wealthy have also mastered the art of legally not paying taxes.

As I mentioned in a previous article, it has been reported that the global elite have up to 32 TRILLION dollars stashed in offshore banks around the globe.

With that amount of money, you could pay off the entire U.S. national debt and still have enough money left over to buy every product and service produced in the United States during an entire year.

It is time to admit that our tax system is broken.

Congress has had decades to fix it, and yet the abuses just keep getting worse.

What we are doing is not working.

We need to abolish the income tax.

If you are still not convinced that the federal income tax is an abomination and that we need to abolish it, here are some more shocking facts about our tax system from one of my previous articles about taxes

1 – The U.S. tax code is now 3.8 million words long.  If you took all of William Shakespeare’s works and collected them together, the entire collection would only be about 900,000 words long.

2 – According to the National Taxpayers Union, U.S. taxpayers spend more than 7.6 billion hours complying with federal tax requirements.  Imagine what our society would look like if all that time was spent on more economically profitable activities.

3 – 75 years ago, the instructions for Form 1040 were two pages long.  Today, they are 189 pages long.

4 – There have been 4,428 changes to the tax code over the last decade.  It is incredibly costly to change tax software, tax manuals and tax instruction booklets for all of those changes.

5 – According to the National Taxpayers Union, the IRS currently has 1,999 different publications, forms, and instruction sheets that you can download from the IRS website.

6 – Our tax system has become so complicated that it is almost impossible to file your taxes correctly.  For example, back in 1998 Money Magazine had 46 different tax professionals complete a tax return for a hypothetical household.  All 46 of them came up with a different result.

7 – In 2009, PC World had five of the most popular tax preparation software websites prepare a tax return for a hypothetical household.  All five of them came up with a different result.

8 – The IRS spends $2.45 for every $100 that it collects in taxes.

9 – According to The Tax Foundation, the average American has to work until April 17th just to pay federal, state, and local taxes.  Back in 1900, “Tax Freedom Day” came on January 22nd.

10 – When the U.S. government first implemented a personal income tax back in 1913, the vast majority of the population paid a rate of just 1 percent, and the highest marginal tax rate was just 7 percent.

11 – Residents of New Jersey pay $1.64 in taxes for every $1.00 of federal spending that they get back.

12 – The United States is the only nation on the planet that tries to tax citizens on what they earn in foreign countries.

13 – According to Forbes, the 400 highest earning Americans pay an average federal income tax rate of just 18 percent.

14 – Warren Buffett had an effective tax rate of just 17.4 percent for 2010.

15 – The top 20 percent of all income earners in the United States pay approximately 86 percent of all federal income taxes.

16 – Sadly, as Bill Whittle has shown, you could take every single penny that every American earns above $250,000 and it would only fund about 38 percent of the federal budget.

Please share this article with as many people as you can.  We have now entered a time of the year when tens of millions of Americans will be filling out their tax returns, and the pain of going through that process will make people even more receptive than normal to the truth about how broken our system is.

So what do you think?

Do you think that it is fair for the ultra-wealthy and hugely profitable corporations to get away with paying zero taxes while you get hammered?

Do you believe that it is time to abolish the income tax?

Please feel free to post a comment with your thoughts below…

No Federal Income Tax

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