Taxes

55 Reasons Why California Is The Worst State In America

Why in the world would anyone want to live in the state of California at this point?  The entire state is rapidly becoming a bright, shining example of everything that is wrong with America.  It is so sad to watch our most populated state implode right in front of our eyes.  Like millions of Americans, I was quite enamored with the state of California when I was younger.  The warm weather, the beaches, the great natural beauty of the state and the mystique of Hollywood all really appealed to me.  At one point I even thought that I wanted to move there.  But today, hordes of Californians are racing to get out of the state because it has become a total nightmare.  It is the worst state in the country in which to do business, taxes were just raised even higher, unemployment is more than 20 percent higher than the national average and the state government is drowning in debt.  Meanwhile, poverty, gang activity and crime just seem to get worse with each passing year.  On top of everything else, the insane politicians in Sacramento just keep on passing more laws that make the problems that the state is facing even worse.  Unfortunately, what is happening in California may be a preview of what is coming to the entire nation.  The old adage, “as California goes, so goes the nation”, has been proven to be true way too many times.

In dozens of different ways, the state of California is showing the rest of us what not to do.  Will we learn from their mistakes, or will we follow them into oblivion?  Please share the list below with as many people as you can.  In addition to a large amount of new research, this list also pulled heavily from one of my previous articles and from outstanding research done by Richard Rider.  The following are 55 reasons why California is the worst state in America…

1. One survey of business executives has ranked California as the worst state in America to do business for 8 years in a row.

2. In 2011, the state of California ranked 50th out of all 50 states in new business creation.

3. According to one recent study, California is the worst-governed state in the entire country.

4. Thanks to Proposition 30, California now boasts the highest state income tax rate in the nation.

5. Even though California just raised taxes dramatically on the wealthy, state revenues are falling like a rock.  State revenue for November 2012 was 10.8 percent below projections.

6. California has the highest sales tax rate in the United States.

7. California has the 8th highest corporate income tax rate in the country.

8. California has the highest “minimum corporate tax” in the country.  Each corporation must pay at least $800 to the state even if a corporation does not make a single dollar of profit.

9. California is tied with New York for the highest gasoline tax rate in the country.

10. California is the only state in America that taxes carbon emissions.

11. The state of California issues some of the most expensive traffic tickets in the nation.  This is another form of taxation.

12. As of October, only Nevada and Rhode Island had higher unemployment rates than California.

13. The unemployment rate in California is more than 20 percent higher than the overall unemployment rate for the rest of the nation.

14. The state of California requires licenses for 177 different occupations (the most in the nation).  The national average is only 92.

15. California teachers are the highest paid in the nation, but California students rank 48th in math and 49th in reading.

16. California accounts for 12 percent of the U.S. population, but a whopping 33 percent of Americans that receive TANF (Temporary Assistance for Needy Families) live there.

17. Only the state of Illinois has a lower bond rating than the state of California does.

18. Including unfunded pension liabilities, the state of California has more than twice as much debt as any other state does.

19. Average pay for California state workers has risen by more than 100 percent since 2005.  That is good news for those state employees, but it is bad news for the taxpayers that have to pay their salaries.

20. More than 5,000 California state troopers made more than $100,000 last year.

21. One highway patrol officer ended up bringing home almost $484,000 in 2011.

22. One state psychiatrist in California was paid $822,000 in 2011.

23. Since 2007, the number of children living in poverty in the state of California has increased by 30 percent.

24. Sadly, an astounding 60 percent of all students attending California public schools now qualify for free or reduced-price school lunches.

25. The American Tort Reform Association has ranked the state of California as the worst “judicial hellhole” in America.

26. Businesses all over the state of California are being absolutely suffocated to death by ridiculous regulations.

27. According to the Milken Institute, operating costs for California businesses are 23 percent higher than the national average.

28. According to CNN, the state of California had the worst “small business failure rate” in America in 2010.  It was 69 percent higher than the national average.

29. The number of people unemployed in the state of California is roughly equivalent to the populations of Nevada, New Hampshire and Vermont combined.

30. Residential customers in California pay about 29 percent more for electricity than the national average.

31. So many poor people and illegal aliens have taken advantage of the “free” healthcare at emergency rooms that many of them have been forced to shut down in California.  As a result, the state of California now ranks dead last out of all 50 states in the number of emergency rooms per million people.

32. Political correctness is totally out of control in California.

33. One California town is actually considering making it illegal to smoke in your own backyard.

34. The traffic around the big cities is horrific.

35. Los Angeles

36. San Francisco

37. Oakland

38. Stockton

39. Sacramento

40. The rampant gang activity in the state gets even worse with each passing year.

41. Crime continues to rise all over the state.

42. Just recently, the city attorney of San Bernardino, California told citizens to “lock their doors and load their guns” because there is not enough money to pay for adequate police protection any longer.

43. The murder rate in San Bernardino is up 50 percent this year.

44. In Oakland, burglaries are up 43 percent so far this year.

45. Today, Oakland is considered the 5th most violent city in the United States.

46. There have been more than 250 gold chain robberies in Stockton, California just since the month of April.

47. In Stockton, the police budget cuts got so bad that the police union put up a billboard at one point with the following message: “Welcome to the 2nd most dangerous city in California. Stop laying off cops.”

48. Jerry Brown.

49. The absolutely insane California state legislature.

50. Wildfires.

51. Mudslides.

52. The state of California lies directly along the infamous “Ring of Fire“.  Approximately 90 percent of all the earthquakes in the entire world happen along the Ring of Fire and the “Big One” could hit the state at any moment.

53. According to the U.S. Census Bureau, approximately 100,000 more people moved out of the state of California in 2011 than moved into it.

54. During 2011, more than 58,000 people moved from California to the state of Texas.

55. Overall, the state of California has experienced a net loss of about four million residents to other states over the past 20 years.

All Of This Whining About The Fiscal Cliff Is Pathetic

The fiscal cliff is coming!  Run for the hills!  There have been endless stories in the mainstream media about the “fiscal cliff” that our country is facing if the Democrats and the Republicans can’t come to some sort of an agreement.  If there is no agreement, taxes will go up and government spending will be reduced by a very small amount.  And yes, that would likely push the U.S. economy into another recession, although there are many that would argue that we are already in a recession right now.  In any event, there is a tremendous amount of distress out there about the fact that something might interrupt the debt-fueled prosperity that we have all been enjoying.  You can almost hear them now: “No! Please don’t cut government spending! Please don’t raise taxes! Please keep stealing more than 100 million dollars from our children and our grandchildren every single hour of every single day so that we can continue this economic illusion that feels so very good.”  The American people want the government to give everything to everybody, but they definitely do not want to pay for it.  They want a big government that showers them with government checks and government benefits, but they don’t want to cough up the ridiculous amount of money that it would take to fund such a government.  So we just keep ripping off our kids and our grandkids.  What we are doing to future generations is not just immoral, it is criminal.  If they get the chance, someday they will look back and curse us for destroying their futures and destroying their country.  So why do we continue to do this to them?  Because we are greedy and selfish and we are absolutely desperate to maintain the massively overinflated standard of living that we have been enjoying.  We have lived way above our means for so long that we don’t even know what “normal” is supposed to be anymore.

But nobody can spend far more money than they bring in forever.  At some point an adjustment comes, and our adjustment is going to be exceedingly painful.

Right now, the overwhelming consensus in the United States seems to be that we should put off any economic pain for as long as possible.  The American people don’t want significant cuts to government spending and they don’t want taxes to be raised to pay for the spending that we are already doing.

But if the Republicans and the Democrats don’t agree to a deal soon, we are going to see taxes raised substantially and government spending cut by a little bit.  A recent CBS News article did a good job of describing exactly what this “fiscal cliff” that we are facing actually is…

There are two parts to the so-called fiscal cliff. The first is the scheduled expiration of the tax cuts enacted in 2001 and 2003 under President George W. Bush, the payroll tax holiday enacted under President Obama, and a host of other tax breaks. The second is $1.2 trillion in automatic spending cuts to defense and domestic programs that are looming due to a 2011 deal that resulted from House Republicans’ reluctance to raise the debt limit.

Now, it’s true that if lawmakers fail to work out any sort of deal, there will be severe long-term consequences for the economy: According to the Tax Policy Center, going off the “cliff” would affect 88 percent of U.S. taxpayers, with their taxes rising by an average of $3,500 a year. Many economists, as well as the nonpartisan Congressional Budget Office, say the combination of spending cuts and tax hikes that are set to take effect would tip the economy into a new recession.

Please keep in mind that the “$1.2 trillion in automatic spending cuts” is not for a single year.  When you break it down, the cuts to spending would be somewhere around 100 billion dollars a year.  And a lot of those “cuts” are actually spending increases that would be cancelled.  So those spending cuts would not really put much of a dent in our yearly budget deficits at all.

The tax increases would be more significant.  Middle class families would be paying thousands of dollars more per year in taxes.  These tax increases would raise some more revenue for the federal government, but they would also do significant damage to the economy in the short-term.

Do you know what they call a combination of government spending cuts and tax increases over in Europe?

They call it “austerity”.

Nations like Greece and Spain have tried this.  They cut spending and raised taxes in an attempt to reduce government budget deficits.  What happens is that the spending cuts and the tax increases cause a significant economic slowdown and this causes tax revenues to come in much lower than projected.  So then more spending cuts and tax hikes are necessary in order to try to get closer to balancing the budget.  But then tax revenues fall even more.

In the end, both Greece and Spain still have large budget deficits and yet the economies of both nations are suffering through depression-like conditions.  The unemployment rate in both nations is now over 25 percent.  Just check out this chart right here to see how nightmarish austerity has been for the economies of both Greece and Spain.

So that is why everybody is freaking out about the fiscal cliff.  They don’t want to go down the same road of austerity.  They want to keep living in an economic fantasy land where we can borrow our way to “prosperity”.

But it is all a lie.  The lines at the Apple stores, the crazed consumers on Black Friday, the restaurants teeming full with people and the government that thinks that it can take care of everyone from the cradle to the grave and yet keep taxes low.  It is all a giant lie.

And no, please do not think that I am in favor of raising taxes.  I most definitely am not.  I believe that the government brings in more than enough money already.

Personally, I believe that we could have a system that completely eliminates income taxes and that funds the government through tariffs and various other forms of taxation.  It was good enough for the Founding Fathers and it should be good enough for us.  But that is a subject for another article.

Our current system has allowed us to live way beyond our means for an extended period of time, but it is only a matter of time until it all comes crashing down.

In fact, the game is already over.  We have already destroyed the future.  At this point it is only a matter of how long we can keep kicking the can down the road and putting off the pain.

Sadly, what we have done on a national level is simply a reflection of our “buy now, pay later” society.  We have become a nation that is constantly willing to sacrifice the future in order to make the present more pleasant.

Just check out this video.  We have become addicted to a prosperity that we cannot possibly pay for.  But as long as someone will keep lending us the money we will continue to enjoy it.

As I have mentioned previously, the government has spent about 11 dollars for every 7 dollars of revenue that it has actually brought in while Barack Obama has been president.

We print, borrow and spend without giving any thought to what we are doing to the future of this country.  We are shredding confidence in our currency and we are wrecking the greatest economic machine that the world has ever seen.

And all of our politicians and all of our “leaders” prance about as if they are the smartest generation of Americans ever, and they think that they are an “example” for the rest of the world, but if our Founding Fathers were around today they would be absolutely horrified about what they have done to the country that they built.

If you think that the economy is bad now, you just wait.

We are still in the “economic fantasy land” phase where we are enjoying a massively inflated standard of living constructed on a mountain of borrowed fiat currency.  Our economy is being held up by trillions of borrowed dollars, and all of that money makes the U.S. economy appear to be far more prosperous than it actually should be.

When we have to start living closer to what our real standard of living should be things are going to get really bad.

Most Americans simply don’t understand that if the federal government went to a balanced budget tomorrow it would instantly plunge the U.S. economy into a depression.

Just look at Greece and Spain.  The same thing is going to happen to us one way or another.

So enjoy this false prosperity while you still can.  This is about as good as things are going to get, and from here on out it is downhill for America.

55 Reasons Why You Should Buy Products That Are Made In America

This is the time of the year when Americans run out to their favorite retail stores and fill up their shopping carts with lots of cheap plastic crap made by workers in foreign countries where it is legal to pay slave labor wages.  By doing this, the American people are actively participating in the destruction of the U.S. economy.  You see, buying products that are made in America is not just a matter of national pride.  It is a matter of national survival.  If we do not support American workers, they are going to continue to see their jobs shipped out of the country.  If we do not support American businesses, they are going to continue to die off at a staggering rate.  Last year, the United States had a trade deficit with the rest of the world of 558 billion dollars.  More than half a trillion dollars that could have gone into the pockets of U.S. workers and U.S. businesses went overseas instead.  If that money had stayed in the country, taxes would have been paid on that mountain of cash and our local, state and federal government debt problems would not be as severe.  As a result of our massive trade imbalance, we have lost tens of thousands of businesses, millions of jobs and trillions of dollars of national wealth.  Both major political parties have sold us out on these issues, and we are getting poorer as a nation with each passing day.  We desperately need a resurgence of economic patriotism in the United States before it is too late.

Yes, I know that it is very tempting to buy foreign-made products.  After all, they are almost always cheaper.

But most people don’t often think about why they are cheaper.

Unfortunately, in the name of “free trade” American workers have been merged into a global labor pool where they have to compete directly for jobs with workers on the other side of the globe that live in countries where it is legal to pay slave labor wages.  This makes employing American workers a tremendous liability.

If a company hires you and pays you 10 to 15 dollars an hour with benefits, how is it going to compete with another company that pays workers a dollar an hour with no benefits on the other side of the planet?

Both major political parties are pushing this emerging “one world economic system“, but it is absolutely killing American jobs.  We have already seen a mass exodus of jobs and businesses out of this country, and wages for the jobs that remain in the United States are being forced down because there are hordes of unemployed workers that are willing to take just about any decent job they can find.

It has become painfully obvious that our politicians are not going to do anything to help us on these issues, so what we need is a mass awakening among the American people.

We need to educate people that buying things that are made in America is good for the economy and that buying things that are made elsewhere is bad for the economy.

But for now, most Americans are clueless.  They will line up on Black Friday morning and trample one another in a desperate attempt to save a few bucks on cheap plastic devices that were made on the other side of the planet.

And they will pay for much of this “shopping” with credit cards.

Credit card debt is on the rise once again.  In fact, average credit card debt per borrower was 4.9 percent higher in the third quarter of 2012 than it was in the third quarter of 2011.  It looks like most of us didn’t learn our lessons from the last financial crisis.

But not all Americans enjoy the shopping that is typically involved with this time of the year.  One recent survey found that approximately 45 percent of all Americans think that there is so much financial pressure associated with the holidays that they wouldn’t mind skipping them completely.

That same poll found that approximately 41 percent of all Americans would only be able to survive for two weeks without a paycheck.  Many Americans are up to their eyeballs in debt, their incomes are not keeping up with rising prices, and they find themselves scratching and clawing just to make it from month to month.

Meanwhile, we continue to destroy our own jobs and businesses by spending our money on products that have been made outside the country.

The following are 55 reasons why you should buy products that are made in America this holiday season…

1. When you buy products that are made in America you support American workers.

2. When you buy products that are made in America you support companies that are doing business in America.

3. In 2000, there were more than 17 million Americans working in manufacturing, but now there are less than 12 million.

4. The United States has a trade imbalance that is more than 7 times larger than any other nation on earth has.

5. Our trade deficit with China in 2011 was $295.5 billion.  That was the largest trade deficit that one country has had with another country in the history of the planet.

6. In 2011, our trade deficit with China was 28 times larger than it was back in 1990 and more than 49,000 times larger than it was back in 1985.

7. When NAFTA was passed in 1993, the United States had a trade surplus with Mexico of 1.6 billion dollars.  In 2010, we had a trade deficit with Mexico of 61.6 billion dollars.

8. One professor has estimated that cutting the U.S. trade deficit in half would create 5 million more jobs in the United States.

9. Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the globe since 1975.  That 8 trillion dollars could have gone to support U.S. businesses and pay the wages of U.S. workers.  Federal, state and local taxes would also have been paid on that 8 trillion dollars if it had stayed in the United States.

10. According to the Economic Policy Institute, America is losing half a million jobs to China every single year.

11. The United States has lost an average of approximately 50,000 manufacturing jobs a month since China joined the World Trade Organization in 2001.

12. According to U.S. Representative Betty Sutton, the United States has lost an average of 15 manufacturing facilities a day over the last 10 years.

13. During 2010 alone, an average of 23 manufacturing facilities permanently shut down in the United States every single day.

14. Overall, the United States has lost more than 56,000 manufacturing facilities since 2001.

15. The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.

16. Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

17. As I have written about previously, 95 percent of the jobs lost during the last recession were middle class jobs.

18. Due in part to the globalization of the labor pool, only about 24 percent of all jobs in the United States are “good jobs” at this point.

19. Right now, more than 41 percent of all working age Americans do not have a job, and the vast majority of the new jobs that are being created are low paying jobs.

20. The United States now has 10 percent fewer “middle class jobs” than it did just ten years ago.

21. According to the Economic Policy Institute, the U.S. economy loses approximately 9,000 jobs for every $1 billion of goods that are imported from overseas.

22. As our economic infrastructure is gutted, formerly great manufacturing cities all over America are being transformed into festering hellholes.

23. Between 2001 and 2007, the value of products that Wal-Mart imported from China grew from $9 billion to $27 billion.

24. In 2001, American consumers spent 102 billion dollars on products made in China.  In 2011, American consumers spent 399 billion dollars on products made in China.

25. The United States spends about 4 dollars on goods and services from China for every one dollar that China spends on goods and services from the United States.

26. Back in 1998, the United States had 25 percent of the world’s high-tech export market and China had just 10 percent. Today, China’s high-tech exports are more than twice the size of U.S. high-tech exports.

27. In 2002, the United States had a trade deficit in “advanced technology products” of $16 billion with the rest of the world.  In 2010, that number skyrocketed to $82 billion.

28. The United States has lost more than a quarter of all of its high-tech manufacturing jobs over the past ten years.

29. Manufacturing employment in the U.S. computer industry was actually lower in 2010 than it was in 1975.

30. The Chinese undervalue their currency by about 40 percent in order to gain a critical advantage over foreign competitors.  This means that many Chinese companies are able to absolutely thrive while their competition in the United States goes out of business.

31. According to the New York Times, a Jeep Grand Cherokee that costs $27,490 in the United States costs about $85,000 in China thanks to all the tariffs.

32. In 2010, China produced more than twice as many automobiles as the United States did.

33. Since the auto industry bailout, approximately 70 percent of all GM vehicles have been built outside the United States.

34. Do you remember when the United States was the dominant manufacturer of automobiles and trucks on the globe?  Well, in 2010 the U.S. ran a trade deficit in automobiles, trucks and parts of $110 billion.

35. In 2010, South Korea exported 12 times as many automobiles, trucks and parts to us as we exported to them.

36. In 2010, China produced 627 million metric tons of steel.  The United States only produced 80 million metric tons of steel.

37. In 2010, China produced 7.3 million metric tons of cotton.  The United States only produced 3.4 million metric tons of cotton.

38. Today, China produces nearly twice as much beer as the United States does.

39. 85 percent of all artificial Christmas trees are made in China.

40. Right now, China is producing more than three times as much coal as the United States does.

41. China is now the number one supplier of components that are critical to the operation of U.S. defense systems.  How stupid can we possibly be?

42. According to author Clyde Prestowitz, China’s number one export to the U.S. is computer equipment.  According to an article in U.S. News & World Report, during 2010 the number one U.S. export to China was “scrap and trash”.

43. All over the United States, road and bridge projects are being outsourced to Chinese firms.  Just check out the following excerpt from a recent ABC News article….

In New York there is a $400 million renovation project on the Alexander Hamilton Bridge.

In California, there is a $7.2 billion project to rebuild the Bay Bridge connecting San Francisco and Oakland.

In Alaska, there is a proposal for a $190 million bridge project.

These projects sound like steps in the right direction, but much of the work is going to Chinese government-owned firms.

“When we subsidize jobs in China, we’re not creating any wealth in the United States,” said Scott Paul, executive director for the Alliance for American Manufacturing.

44. The new World Trade Center tower is going to include glass that has been imported from China.

45. The new Martin Luther King memorial on the National Mall was made in China.

46. The Chinese economy has grown 7 times faster than the U.S. economy has over the past decade.

47. The Chinese economy is projected to be larger than the U.S. economy by 2016.

48. One economist is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040.

49. In recent years the U.S. economy has embraced “free trade” and the emerging one world economy like never before.  Instead of increasing the number of jobs in our economy, it has resulted in the worst stretch of job creation in the United States in modern history….

If any single number captures the state of the American economy over the last decade, it is zero. That was the net gain in jobs between 1999 and 2009—nada, nil, zip. By painful contrast, from the 1940s through the 1990s, recessions came and went, but no decade ended without at least a 20 percent increase in the number of jobs.

50. If you gathered together all of the workers that are “officially” unemployed in the United States today, they would constitute the 68th largest country in the world.

51. China now holds approximately more than a trillion dollars of U.S. government debt.  If you were alive back when Jesus was born and you had spent a million dollars every single day since then, you still would not have spent that much money by now.

52. Jeffrey Immelt, the head of Barack Obama’s highly touted “Jobs Council”, has shipped tens of thousands of good jobs out of the United States.

53. Without enough good jobs, more Americans than ever before are falling into poverty.  Today, more than 100 million Americans are enrolled in at least one welfare program run by the federal government.

54. According to Professor Alan Blinder of Princeton University, 40 million more U.S. jobs could be sent offshore over the next two decades if current trends continue.

55. If U.S. consumers do not start supporting U.S. workers and U.S. businesses, eventually we will all be so poor that very few of us will be able to afford to buy any gifts during the holiday season.

Will The Wealthy Race To Dump Stocks And Other Financial Assets Before The Fiscal Cliff Kicks In?

The election results made it abundantly clear that taxes are going to be going up, and right now a lot of wealthy people all over America are trying to figure out how to best position themselves for the hit that is coming.  There are a whole host of tax cuts that are set to expire on December 31st, and many analysts are now speculating that we could see a race to dump stocks and other financial assets before 2013 in order to get better tax treatment on those sales.  Of course it is still possible that Congress may reach a bargain which would avoid these tax increases, but with each passing day that appears to be increasingly unlikely – especially regarding the tax increases on the wealthy.  Whatever you may believe about this politically, the truth is that we should all be able to agree that these looming tax increases provide an incentive for wealthy people to sell off financial assets now rather than later.  After all, there are very few people out there that would actually prefer to pay higher taxes on purpose.  If the race to dump financial assets becomes a landslide, could this push stocks down significantly late in the year?  Already there are all sorts of technical signs that indicate that stocks are ready for a “correction” at the very least.  For example, the S&P 500 has already closed below its 200 day moving average for several days in a row.  Could the “sell off” that has already begun become a race for the exits?

A lot of Americans have heard about the looming “fiscal cliff”, but most don’t really understand the specifics.

For investors, there are several key changes which will happen unless Congress does something by January 1st.

First of all, the tax rate on capital gains will go from 15 percent to 20 percent.  For those with high incomes, the rate will be even higher than that thanks to a tax increase that our politicians managed to sneak into Obamacare.  So, some wealthy individuals will see their capitals gains taxed at nearly 24 percent in 2013 unless something is done.

For dividends, the outlook is even more frightening.  The tax rate on dividends will increase from 15 percent right now to over 43 percent for the highest income earners.

We have already seen these tax increases play into business decisions that have been made in recent months.  For example, it is being reported that George Lucas potentially saved hundreds of millions of dollars in taxes by selling Star Wars to Disney this year rather than next year.

Anyone out there that wants to take advantage of the current tax rates on capital gains and dividend income better do so now, because these tax rates look like they are going to go away and they probably will not be back for a very, very long time.

According to CNBC, this makes the next couple of months an ideal time to dump stocks and other financial assets…

For many of the wealthy, 2012 is becoming a good year to sell.

They’re worried about the “fiscal cliff,” which is when tax cuts expire and spending cuts are set to go into effect at the end of the year.

Fearing an increase in capital gains and dividend taxes, many of the rich are unloading stocks, businesses and homes before the end of the year.

And the truth is that stocks simply did not have much higher that they could possibly go anyway.  Anyone that is trying to “get out while the getting is good” should take heed of what Marc Faber recently told CNBC…

“The market is going down because corporate profits will begin to disappoint, the global economy will hardly grow next year or even contract, and that is the reason why stocks, from the highs of September of 1,470 on the S&P, will drop at least 20 percent, in my view.”

In fact, Faber is absolutely convinced that a full-blown stock market crash is coming no matter what happens with the fiscal cliff…

“I think the whole global financial system will have to be reset and it won’t be reset by central bankers but by imploding markets — either the currency [markets, debt market or stock markets,” he said. “It will happen — it will happen one day and then we’ll be lucky if we still have 50 percent of the asset values that we have today.”

Politics and economics have always been deeply intertwined.  The results of the most recent election are going to have some very deep consequences.  Already we have seen a large number of businesses either announce layoffs or that hours for their workers will be cut back.  You can find a bunch of tweets from small business owners talking about how they won’t be hiring anyone or that they will be forced to reduce hours right here.  You can find a bunch of tweets from average citizens all over the country talking about how their hours are already being cut back right here.

With each passing day, our country is getting poorer, it is getting even deeper in debt and our economy is becoming even more unstable.  We are on a path that will only lead to total economic disaster, but the American people just voted for more of the same.

So now we will get to see how this all plays out.

Is there anyone out there that is still optimistic about what is coming next for the U.S. economy?

Share This Massive List Of Post-Election Firings And Layoffs With Everyone You Can

The victory by Barack Obama on election night has resulted in a huge wave of firings and layoffs all over America.  A large number of businesses seem to have suddenly shifted into panic mode.  The number of layoff announcements that we have seen in the last 48 hours has been absolutely shocking.  So why is this happening?  Well, the truth is that the federal government is absolutely suffocating small businesses all over America with rules, regulations and taxes.  If you have never tried to run a small business, then you have no idea how oppressive this system actually is for people that are trying to run small businesses successfully.  It has steadily gotten worse over the years no matter who has been in the White House and no matter who has controlled Congress.  So we shouldn’t put 100% of the blame on Obama.  Bush massively expanded government and made things harder on small business people too.  But what many small business people were looking for on this election day was just a little bit of help.  Many were desperately holding out hope that Obamacare would be repealed so that they would not have to get rid of some of their employees.  Many were hoping to get a little bit of relief from the crippling regulations and taxes that are absolutely crushing them.  But now that Barack Obama has been given another four years, they understand that there is no hope on the horizon and that things are only going to get worse.  So they are making the hard decisions that they feel are necessary in order to survive in this economic environment.

And I certainly don’t blame them.  You only want to have employees if you can make a profit on them.  And in this environment it is getting harder than ever to make a profit on an employee.  You see, the truth is that what you cost your employer goes far beyond your salary or your hourly wage.  I think many of you would be absolutely shocked if you learned how much it actually costs your employer to employ you.  And now thanks to Obamacare, that cost is going to go up even more.

Many businesses are not even feasible at all in this economic environment.  Many small businesses had been holding out hope that somehow this election might turn things around and make it possible for them to keep going, but when Obama won it was kind of like the straw that broke the camel’s back.

You can’t do what the federal government and the state governments are doing to us and expect to have a thriving economy.  They are choking the life out of us.

New businesses and small businesses are supposed to be at the heart of our economic system.  Unfortunately, the environment that has been created is absolutely killing them.  This is a recipe for disaster.

In a previous article, I noted that the number of jobs created at new businesses in 2010 in the United States was less than half of what it was back in the year 2000.

Now we can expect that number to get even worse and we can expect large numbers of small businesses to shrink in size or close their doors completely.

The following is a list of some of the post-election firings and layoffs that we have seen since Tuesday night…

#1 Utah

A Utah coal company owned by a vocal critic of President Barack Obama has laid off 102 miners.

The layoffs at the West Ridge Mine are effective immediately, according to UtahAmerican Energy Inc., a subsidiary of Murray Energy Corp. They were announced in a short statement made public Thursday, two days after Obama won re-election.

The layoffs are necessary because of the president’s “war on coal,” the statement said. The slogan is one used frequently during the election by Murray Energy CEO Robert Murray, who was an ardent supporter of Republican presidential candidate Mitt Romney.

In its statement, UtahAmerican Energy blames the Obama administration for instituting policies that will close down “204 American coal-fired power plants by 2014” and for drastically reducing the market for coal.

#2 Ohio

I work for the oldest and largest health insurer in the state of Ohio in the underwriting department. At 9 a.m.this morning, my department (about 50) were called into a meeting in the executive boardroom. We were informed that due to a provision in the healthcare ‘reform’ effective 2014 called guarantee issue, our services would no longer be needed, and we were offered severance  So Obama got to keep his job, and we lost ours. It is maddening that some tyrant 400 miles away can have such a ruinous effect on peoples lives.

#3 Nevada

A Las Vegas business owner with 114 employees fired 22 workers today, apparently as a direct result of President Obama’s re-election.

“David” (he asked to remain anonymous for obvious reasons) told Host Kevin Wall on 100.5 KXNT that “elections have consequences” and that “at the end of the day, I need to survive.”

Here’s an excerpt from the interview. Click the audio tab below to hear even more from this compelling conversation:

“I’ve done my share of educating my employees. I never tell them which way to vote. I believe in the free system we have, I believe in the right to choose who they want to be president, but I did explain as a business owner that I have always put my employees first. I always made sure that when I went without a paycheck that [I] made sure they were paid. And I explained that I always put them first and unfortunately I’m at a point where I’m being forced to have to worry about me and my family now and a business that I built from just me to 114 employees.

#4 Posted below is a list of layoff headlines from the past few days that was posted on AmericanThinker.com…

Obama was “fired up” and so were the voters, and so now, the mass firings begin. Here’s a collection of today’s headlines.  Please say a prayer for the families who will be suffering. Had Romney won, many of these companies would now be hiring.

Teco Coal officials announce layoffs

Momentive Inc plans temporary layoffs for 150

Wilkes-Barre officials to announce mandatory layoffs

600 layoffs at Groupon

More layoffs announced at Aniston Weapons Incinerator

Murray Energy confirms 150 layoffs at 3 subsidiaries

130 laid off in Minnesota dairy plant closure

Stanford brake plant to lay off 75

Turbocare, Oce to lay off more than 220 workers

ATI plans to lay off 172 workers in North Richland Hills

SpaceX claims its first victims as Rocketdyne lays off 100

Providence Journal lays off 23 full-time employees

CVPH lays off 17

New Energy lays off 40 employees

102 Utah miners laid off because of ‘war on coal’, company says

US Cellular drops Chicago, cuts 640 jobs

Career Education to cut 900 jobs, close 23 campuses

Vestas to cut 3,000 more jobs

First Energy to cut 400 jobs by 2016

Mine owner blames Obama for layoffs (54 fired last night)

Canceled program costs 115 jobs at Ohio air base

AMD trims Austin workforce – 400 jobs slashed

100 workers lose jobs as Caterpillar closes plant in Minnesota

Exide to lay off 150 workers

TE Connectivity to close Guilford plant, lay off 620

More Layoffs for Major Wind Company (3,000 jobs cut)

Cigna to lay off 1,300 workers worldwide

Ameridose to lay off hundreds of workers

#5 According to the Blaze, the following major corporations have all announced layoffs in just the past two days…

Energizer

Exide Technologies

Westinghouse

Research in Motion Limited

Lightyear Network Solutions

Providence Journal

Hawker Beechcraft

Boeing (30% of their management staff)

CVPH Medical Center

US Cellular

Momentive Performance Materials

Rocketdyne

Brake Parts

Vestas Wind Systems

Husqvarna

Center for Hospice New York

Bristol-Meyers

OCE North America

Darden Restaurants

West Ridge Mine

United Blood Services Gulf

You can get the rest of the details right here.

#6 The following is a list of companies that will be laying off workers just because of Obamacare that was compiled by FreedomWorks…

Dana Holding Corp.

As recently as a week ago, a global auto parts manufacturing company in Ohio known as Dana Holding Corp., warned their employees of potential layoffs, citing “$24 million over the next six years in additional U.S. health care expenses”.  After laying off several white collar staffers, company insiders have hinted at more to come.  The company will have to cover the additional $24 million cost somehow, which will likely equate to numerous cuts in their current workforce of 25,500 worldwide.  

Stryker

One of the biggest medical device manufacturers in the world, Stryker will close their facility in Orchard Park, New York, eliminating 96 jobs in December.  Worse, they plan on countering the medical device tax in Obamacare by slashing 5% of their global workforce – an estimated 1,170 positions.

Boston Scientific

In October of 2009, Boston Scientific CEO Ray Elliott, warned that proposed taxes in the health care reform bill could “lead to significant job losses” for his company.  Nearly two years later, Elliott announced that the company would be cutting anywhere between 1,200 and 1,400 jobs, while simultaneously shifting investments and workers overseas – to China.

Medtronic

In March of 2010, medical device maker Medtronic warned that Obamacare taxes could result in a reduction of precisely 1,000 jobs.  That plan became reality when the company cut 500 positions over the summer, with another 500 set for the end of 2013.  

Others

A short list of other companies facing future layoffs at the hands of Obamacare:

  • Smith & Nephew – 770 layoffs
  • Abbott Labs – 700 layoffs
  • Covidien – 595 layoffs
  • Kinetic Concepts – 427 layoffs
  • St. Jude Medical – 300 layoffs
  • Hill Rom – 200 layoffs

A lot of other businesses are going to reduce the number of employees they have or reduce the average work week in order to avoid the Obamacare insurance coverage mandate that will soon be implemented.

This is how CNSNews.com describes the choice that many employers will be facing…

That section, known as the employer mandate, requires any business with 50 or more full-time employees to provide at least the minimum level of government-defined health coverage to those employees. In other words, a business must provide insurance if it has 50 or more employees working an average of just 30 hours per week, which is 10 hours per week fewer than the traditional 40-hour work week.

Thus, by cutting employees’ hours to ensure they average less than the 30 per week, employers could potentially avoid the cost of providing the minimum insurance levels mandated by Obamacare.

So if your company trims the number of workers to just under 50 or starts going to “29 hour work weeks”, then you will know who to blame.

All of this is complete and utter insanity.  We are committing national economic suicide.

But perhaps we deserve this.  After all, Americans willingly chose their leaders on election day.  It is getting harder and harder to deny that our politicians are truly a reflection of who we are as a nation.

The American people chose this path, and now we get to see where it leads us.

Obama Has Stolen $5.3 Trillion From Our Children In Order To Make Himself Look Good

Barack Obama has destroyed the future of America in order to improve his chances of winning the next election.  Under Obama, 5.3 trillion dollars has been ruthlessly stolen from our children and our grandchildren.  That money has been used to pump up the debt-fueled false prosperity that we have been experiencing.  When the U.S. government borrows money that it does not have from someone else (such as China) and spends that money into the economy it is going to make our economic numbers look better.  Even if the government spends that money on incredibly stupid things, it still gets into the hands of average Americans who in turn spend that money on food, gas, clothes, etc.  If we were to go back and take that extra 5.3 trillion dollars out of the U.S. economy, I guarantee you that we would be in a rip-roaring depression right now.  We would look a lot like Greece at this point.  For several years Greece has been raising taxes and cutting government spending in an attempt to balance the budget and these austerity measures have resulted in an unemployment rate of over 23 percent and an economy that has contracted by close to 25 percent.  Most Americans don’t want to go through pain like that so they are okay with continuing to financially rape our children and our grandchildren.  Just imagine how you would feel if your parents died tomorrow and you found out that they had left you with a million dollar debt that you were legally obligated to pay off.  How would you feel, knowing that you had just been sold into debt slavery for the rest of your life?  Well, that is how our children and our grandchildren are going to feel.  We are destroying the greatest economic machine the world has ever seen, we are accumulating the biggest mountain of debt in the history of the planet, and the coming economic collapse that we have caused is going to wipe out the promising future that our children and our grandchildren were supposed to have.  If they get the chance, future generations of Americans will curse us bitterly and will spit on our graves.  What we are doing to our children and our grandchildren is the kind of stuff that horror movies are made of.  You should be ashamed of yourself America.

The federal budget deficit for 2012 will be larger than the entire U.S. national debt was 30 years ago.  In 1982 Ronald Reagan was in the White House and the U.S. national debt was considered to be a tremendous national crisis.  But somehow we have allowed our national debt to grow from about a trillion dollars back then to approximately $16,000,000,000,000 today.

By the end of Obama’s first term, the U.S. national debt will have grown more than it did from the time that George Washington became president to the time that George W. Bush became president.

That is hard to believe.

Obama is going to outdo all the presidents from George Washington through Bill Clinton in just one term.

Amazing.

At this point, the U.S. national debt is more than 22 times larger than it was when Jimmy Carter became president.

This has allowed us to enjoy a standard of living far beyond what we deserved to.  We have stolen from the future to make the present more pleasant.

But hardly anybody wants the party to end.  Especially not our Congress critters – they are living like kings and queens at our expense.  Our “representatives” in Washington D.C. love to give speeches about being “financially responsible”, but most of them never take any serious action about the debt because the way things are working now has been incredibly good to them.

And the truth is that both political parties have been responsible.  In 2010, Republicans took control of the House of Representatives with a clear mandate to get government spending under control.  Not a single penny of government money can be spent without their permission.  But since they took control, the U.S. national debt has increased by another 1.8 trillion dollars.

At this point, this current Congress (controlled by both Republicans and Democrats) has added more to the national debt than the first 97 Congresses combined.

We expect this kind of nonsense from the Democrats, but the Republicans are supposed to know better.

Of course our entire financial system is designed to permanently entrap our federal government in an endless spiral of debt, but neither political party ever talks about that.

Sadly, the U.S. national debt is now more than 5000 times larger than it was when the Federal Reserve was first created.

But we never hear about the link between the Federal Reserve and our national debt from either political party or on the mainstream news.

So most Americans do not even realize that our system is designed to create government debt.

It is absolutely disgusting.

We say that we care about our kids, and yet we are passing down a $16,000,000,000,000 debt to them.

Talk about child abuse.

Most people have a really hard time grasping how much money 16 trillion dollars actually is.

If right this moment you went out and started spending one dollar every single second, it would take you more than 31,000 years to spend one trillion dollars.

And it would take you more than half a million years to spend 16 trillion dollars.

This is a debt that is impossible to pay back.  Just look at how it has exploded over the past 40 years….

In a previous article I discussed the distressing rate at which our debt is growing….

It took more than 200 years for the U.S. national debt to reach 1 trillion dollars.  In 1986, the U.S. national debt reached 2 trillion dollars.  In 1992, the U.S. national debt reached 4 trillion dollars.  In 2005, the U.S. national debt doubled again and reached 8 trillion dollars.  Now the U.S. national debt is about to cross the 16 trillion dollar mark.  How long can this kind of exponential growth go on?

If we can’t even slow down the growth of our debt, how do we ever expect to repay a single penny?

The sad truth is that we aren’t ever going to start paying down our debt.  We have gotten to the point where if we take our foot off the debt accelerator we plunge directly into a depression and the entire system collapses.  It is like a really sick version of the movie “Speed”.

Where is Keanu Reeves when you need him?

Since Barack Obama entered the White House, he has approved a whole host of measures that have been good for the economy in the short-term.  TARP, the stimulus packages, the auto industry bailout and the payroll tax cut are just a few examples.

Barack Obama has wanted to do everything he possibly can to stimulate the economy in the short-term so that he can win again in 2012.

But what about the future?

Barack Obama could not care less about the future.  He is just like so many of our other politicians.  He is blinded by selfish ambition.

Since Barack Obama became president, the U.S. national debt has increased by an average of more than $64,000 per taxpayer.

Are you willing to write a check for your share?

No?

Oh, let’s just pass this horrific debt on to our children, right?

The path that we are on as a nation cannot go on too much longer.  The truth is that we are headed for financial oblivion.

A recently revised IMF policy paper entitled “An Analysis of U.S. Fiscal and Generational Imbalances: Who Will Pay and How?” projects that U.S. government debt will rise to about 400 percent of GDP by the year 2050.

Of course we will never get to the point.  Our financial system will collapse long before then.

Sadly, the United States already has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain does.

So why are we not like Greece or Spain yet?

Well, it is because we are still able to borrow huge piles of money very, very cheaply.

But at some point that will come to an end, and when it does the consequences are going to be nightmarish.

Historically, the interest rate on 10 year U.S. Treasuries has averaged 6.68 percent.  If the average rate of interest on U.S. debt rose to that level today, we would be paying more than a trillion dollars a year just in interest on the national debt.

And when you consider our future unfunded liabilities things get even more frightening.

According to Boston University economist Laurence Kotlikoff, the “fiscal gap” is “the present value difference between projected future spending and revenue”.  His calculations have led him to the conclusion that the United States is facing a fiscal gap of 222 trillion dollars.

And this gap is rising at a breathtaking pace.

The following is an excerpt from a recent article co-authored by Kotlikoff….

In 2007, the first year the CBO produced the Alternative Fiscal Scenario, the gap, by our reckoning, stood at $175 trillion. By 2009, when the CBO began reporting the AFS annually, the gap was $184 trillion. In 2010, it was $202 trillion, followed by $211 trillion in 2011 and $222 trillion in 2012.

But if we interrupt this debt cycle we immediately go into a depression.

We are a debt addict that will die without more debt.

Meanwhile, our national ability to produce wealth is going down the toilet.

All over the country businesses are shutting down, factories are being closed and millions of jobs are being sent overseas.

As I wrote about the other day, American families are steadily getting poorer.  The middle class is shrinking and the tax base is shriveling up.

Many Americans end up flat broke at the end of their lives these days.  In fact, one study found that nearly half of all retirees end up with $10,000 or less when they die.

So where is all of the money for servicing this gigantic national debt going to come from?

Even if Bill Gates gave every single penny of his fortune to the U.S. government, it would only cover the U.S. budget deficit for 15 days.

So what is the solution?

If we keep spending money like this we are doomed, but if we stop spending money like this we are doomed.

And debt is not just a problem that the federal government is facing.

Posted below is a chart that shows the growth of all forms of debt in the United States over the past several decades.  40 years ago, there was less than 2 trillion dollars of total debt owed in the United States.  Now there is nearly 55 trillion dollars of debt owed.  This generation has destroyed the future and has set the stage for an unprecedented economic collapse.  Shame on you America….

How The Super Rich Avoid Taxes Even As They Demand That The Rest Of Us Pay More

The way that we tax people in the United States is fundamentally broken and should be completely discarded.  The U.S. tax code is absolutely riddled with loopholes that allow the super rich to legally avoid taxes while many of the rest of us are being taxed into oblivion.  In our system of taxation, middle class families that work hard and try to play by the rules are deeply penalized while those that are willing to abuse the system make out like bandits.  There is something fundamentally wrong with a system that enables wealthy politicians such as Barack Obama and Mitt Romney to pay a smaller percentage of their incomes in taxes than millions of middle class families.  Mitt Romney has millions of dollars parked down in the Cayman Islands and in other tax havens.  He does this to avoid taxes.  Unfortunately, most Americans do not have the resources to funnel money through offshore tax havens.  Most Americans just automatically have their paychecks shredded by taxes and then try to live on whatever is left over.  Most Americans are just trying to survive financially from one month to the next.  But the super rich have options.  Thanks to technology, they can live almost anywhere they want and they can run their companies and manage their investments from anywhere in the world.  The truth is that the wealthier you are the easier it is to avoid taxes.  But even as the ultra-wealthy do their best to avoid taxes, many of them still feel free to demand that the rest of us be taxed more.

So what are some of the ways that the super rich avoid taxes?

Well, let’s start with those that are just “somewhat wealthy”.  Many millionaires still want or need to be U.S. citizens, so they are subject to the U.S. tax code.  Fortunately for them, their tax lawyers know of thousands of loopholes that have been designed to help the rich avoid taxes.

The following is from a recent article by Jen Talley….

Some of the richest people in the country pay the least, relatively speaking, in taxes. How is this possible? Answer: Through the clever manipulation of the U.S. tax code’s loopholes. And it works: as income rises, effective tax rates rise as well, but only up to a point. IRS data shows that the effective income tax rate flattens out at just over 24 percent for those making over a million dollars. As income exceeds $1.5 million, the rate begins to decline; those with incomes above $10 million pay an average income tax rate of around 19 percent. So, how do they do it?

You could write an entire series of books on the technical details of how this gets done.  Trust me, I studied tax law when I was in law school.

If you are interested in digging into some of the technical details of tax avoidance, a recent Businessweek article detailed 10 ways that the wealthy use our current tax code to avoid paying billions of dollars in taxes.  It is an article worth reading if you have the time.

Sadly, tax avoidance by the wealthy is not just something that happens in the United States.  The truth is that the exact same kind of thing happens in the UK as well.

There is not an easy fix to this problem.  Our politicians have had decades to try to come up with a fair tax system and they have completely failed.  The wealthy are always several steps ahead of them.

But federal taxes are not the only taxes that can be avoided.  The vast difference in state tax rates creates another opportunity.

One advantage that wealthy Americans have is that they are far more mobile than most other Americans are.  So if they don’t like the tax system in one state they can simply pick up and move to another state.

According to the Tax Foundation, 3.4 million Americans left New York state between 2000 and 2010.

So where did they go?

The following is from a recent CNS News article….

Where are they escaping to?  The Tax Foundation found that more than 600,000 New York residents moved to Florida over the decade – opting perhaps for the Sunshine State’s more lenient tax system – taking nearly $20 billion in adjusted growth income with them.

There is no state income tax in Florida.  So moving from New York to Florida can end up saving you a bundle.

The same kind of migration is happening out west as well.  According to that same CNS article, hundreds of thousands of people have been moving from California (a high tax state) to Texas (no state income tax)….

Between 2000 and 2010, the most recent data available, 551,914 people left California for Texas, taking $14.3 billion in income.  Texas has no state income tax or estate tax.

A total of 48,877 people moved to Texas from California between 2009 and 2010 alone, totaling $1.2 billion in income.  Another 28,088 from California relocated to Nevada and 30,663 to Arizona, a loss of  $699.1 million and $707.8 million in income respectively.

Not that anyone really needs much of an excuse to move away from California.  It is rapidly decaying right in front of our eyes.

But a lot of families do not have the same options that wealthy people do. Unfortunately, most average Americans are tied to their jobs and it would be much more difficult for them to pick up and move across the country.  In this economy it can be economic suicide to give up a good job.

The reality is that most of us simply do not have the resources to play the same kinds of games that the wealthy play.

Sadly, even our most prominent politicians avoid taxes.

Just look at Massachusetts Senator John Kerry.  He has avoided approximately $500,000 in taxes by docking his yacht in Rhode Island rather than in Massachusetts.

Yet Kerry sure does love to call for more taxes on the rest of us, doesn’t he?

Now let’s talk about the “super rich” and the “ultra-wealthy”.  For many people that are worth billions of dollars, tax avoidance has become an art from.

Facebook co-founder Eduardo Saverin made national headlines recently when he gave up his U.S. citizenship, but the truth is that his case is small potatoes compared to the global elite and the shadow banking system that supports them.

According to the IMF, the global elite are holding a total of 18 trillion dollars in offshore banks.

That amount is more than the GDP of the United States for an entire year.

So what do I mean by “offshore banks”?  I defined the term in a previous article….

Well, the term originally developed because the banks on the Channel Islands were “offshore” from the United Kingdom.  Most “offshore banks” are still located on islands today.  The Cayman Islands, Bermuda, the Bahamas, and the Isle of Man are examples of this.  Other “offshore banking centers” such as Monaco are actually not “offshore” at all, but the term applies to them anyway.

Traditionally, these offshore banking centers have been very attractive to both criminals and to the global elite because they would not tell anyone (including governments) about the money that anyone had parked there.

It has been reported that 80 percent of all international banking transactions involve offshore banks.  A whopping 1.4 trillion dollars is being held in offshore banks in the Cayman Islands alone.

An article that appeared in the Guardian estimated that a third of all the wealth on the entire planet is being kept in offshore banks.  One of the primary reasons for this is tax avoidance.

A lot of wealthy individuals never even visit these tax havens and yet reap the benefits anyway.  The truth is that tax avoidance has become way too easy.  The following example is from a recent Politico article….

A plausible scenario plays out like this: I hire an accountant. Doing her job, my accountant tells me that if I sign a few legal documents and route my money through a small Caribbean island, I could keep more of my paycheck and pay a lower tax rate. I may have earned my money in the United States, but legally I can claim that it was, in fact, earned in a tax haven.

Are you disgusted yet?

You should be.

But even though they avoid taxes like the plague, many of these elitists have the gall to call for higher taxes on all the rest of us.

For example, let’s review what the managing director of the IMF, Christine Lagarde, said in a recent interview….

“Do you know what? As far as Athens is concerned, I also think about all those people who are trying to escape tax all the time. All these people in Greece who are trying to escape tax.”

Even more than she thinks about all those now struggling to survive without jobs or public services? “I think of them equally. And I think they should also help themselves collectively.” How? “By all paying their tax. Yeah.”

It sounds as if she’s essentially saying to the Greeks and others in Europe, you’ve had a nice time and now it’s payback time.

“That’s right.” She nods calmly. “Yeah.”

And what about their children, who can’t conceivably be held responsible? “Well, hey, parents are responsible, right? So parents have to pay their tax.”

Well, it turns out that she doesn’t pay any income taxes at all on her own income….

The IMF chief Christine Lagarde was accused of hypocrisy yesterday after it emerged that she pays no income tax – just days after blaming the Greeks for causing their financial peril by dodging their own bills.

The managing director of the International Monetary Fund is paid a salary of $467,940 (£298,675), automatically increased every year according to inflation. On top of that she receives an allowance of $83,760 – payable without “justification” – and additional expenses for entertainment, making her total package worth more than the amount received by US President Barack Obama according to reports last night.

Her “diplomatic status” allows her to escape all income taxes.

So perhaps she should pay her “fair share” before pointing the finger at anyone else.

But she is not the only one being hypocritical.

The super rich claim that they should pay lower taxes on investment income for the good of our “capitalist system”, but when their banks are about to go under they are more than happy to have those losses be socialized.

As I wrote about yesterday, the stage is already set for another massive round of bailouts when the next great financial crisis strikes.  Once again our taxes will pay for the mistakes of the ultra-wealthy.

The truth is that our system is fundamentally broken.

We need to abolish the income tax and shut down the IRS.

Those two steps alone would do wonders for our economic system.

We also need to shut down the Federal Reserve and break up the too big to fail banks.

Unfortunately, the vast majority of our politicians are not even willing to consider any of those solutions.

So our fundamentally broken system will continue to chug along.

It really is sad.

24 Outrageous Facts About Taxes In The United States That Will Blow Your Mind

The U.S. tax code is a complete and utter abomination and it needs to be thrown out entirely.  Nobody in their right mind would ever read the whole thing – it is over 3 million words long.  Each year, Americans spend billions of hours and hundreds of billions of dollars trying to comply with federal tax requirements.  Sadly, it is the honest, hard working Americans in the middle class that always get hit the hardest.  The tax code is absolutely riddled with loopholes that big corporations and the ultra-wealthy use to minimize their tax burdens as much as possible.  Many poor people do not pay any income taxes at all.  The dishonest are rewarded for cheating on their taxes (if they can get away with it) and the ultra-wealthy have moved trillions of dollars to offshore tax havens where they can avoid U.S. taxation altogether.  Our system is incredibly unfair to the millions of hard working people in the middle class and upper middle class that drag themselves out of bed and go to work each day and try to do the right thing.  In addition, the current U.S. tax system is incredibly inefficient, it diverts a tremendous amount of resources away from more valuable economic activities, and it has chased thousands of businesses and trillions of dollars out of the United States.  The U.S. tax code is such a complete and utter mess at this point that it can never be “fixed”.  The only rational thing to do is to abolish it completely, and any politician that tells you otherwise is lying to you.

The following are 24 outrageous facts about taxes in the United States that will blow your mind….

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.

20 – In a previous article, I discussed how many of our largest corporations make huge profits and yet pay less than nothing in taxes….

What U.S. corporations are able to get away with is absolutely amazing.

The following figures come directly out of a report by Citizens for Tax Justice.  These are combined figures for the tax years 2008, 2009 and 2010.

During those three years, all of the corporations below made a lot of money.  Yet all of them paid net taxes that were below zero for those three years combined.

How is that possible?  Well, it turns out that instead of paying in taxes to the federal government, they were actually getting money back.

So for these corporations, their rate of taxation was actually below zero.

If you have not seen these before, you are going to have a hard time believing some of these statistics…..

*Honeywell*

Profits: $4.9 billion

Taxes: -$34 million

*Fed Ex*

Profits: $3 billion

Taxes: -$23 million

*Wells Fargo*

Profits: $49.37 billion

Taxes: -$681 million

*Boeing*

Profits: $9.7 billion

Taxes: -$178 million

*Verizon*

Profits: $32.5 billion

Taxes: -$951 million

*Dupont*

Profits: $2.1 billion

Taxes -$72 million

*American Electric Power*

Profits: $5.89 billion

Taxes -$545 million

*General Electric*

Profits: $7.7 billion

Taxes: -$4.7 billion

Are you starting to get the picture?

21 – Exxon-Mobil paid $15 billion in taxes in 2009, but not a single penny went to the U.S. government.

22 – Many wealthy Americans hide enormous amounts of money outside the country in order to avoid paying taxes.  According to the IMF, a total of 18 trillion dollars is currently being hidden in offshore banks.

23 – The number of traffic accidents spikes each year right around April 15th.  The following is from a recent Bloomberg article….

Deaths from traffic accidents around April 15, traditionally the last day to file individual income taxes in the U.S., rose 6 percent on average on each of the last 30 years of tax filing days compared with a day during the week prior and a week later, according to research published in the Journal of the American Medical Association.

24 – Most of the tax debate is focused on income taxes, but the truth is that Americans pay dozens of other taxes every single year.  The following are just a few of the taxes that many Americans pay….

#1 Building Permit Taxes

#2 Capital Gains Taxes

#3 Cigarette Taxes

#4 Court Fines (indirect taxes)

#5 Dog License Taxes

#6 Federal Unemployment Taxes

#7 Fishing License Taxes

#8 Food License Taxes

#9 Gasoline Taxes

#10 Gift Taxes

#11 Hunting License Taxes

#12 Inheritance Taxes

#13 Inventory Taxes

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

#15 IRS Penalties (tax on top of tax)

#16 Liquor Taxes

#17 Luxury Taxes

#18 Marriage License Taxes

#19 Medicare Taxes

#20 Property Taxes

#21 Recreational Vehicle Taxes

#22 Toll Booth Taxes

#23 Sales Taxes

#24 Self-Employment Taxes

#25 School Taxes

#26 Septic Permit Taxes

#27 Service Charge Taxes

#28 Social Security Taxes

#29 State Unemployment Taxes (SUTA)

#30 Telephone Federal Excise Taxes

#31 Telephone Federal Universal Service Fee Taxes

#32 Telephone Minimum Usage Surcharge Taxes

#33 Telephone State And Local Taxes

#34 Tire Taxes

#35 Toll Bridge Taxes

#36 Toll Tunnel Taxes

#37 Traffic Fines (indirect taxation)

#38 Utility Taxes

#39 Vehicle License Registration Taxes

#40 Vehicle Sales Taxes

#41 Workers Compensation Taxes

When you account for all forms of taxation on the federal, state and local levels there are many Americans that pay out more than half of their incomes in taxes.

We are being taxed into oblivion, and yet most Americans do not even realize that it is happening.

It is kind of like being killed by thousands of tiny cuts.

So what do all of these taxes buy us?

They buy us a massively bloated government that wastes money on some of the craziest things imaginable.

Millions of Americans work for the federal government, and yet most of them produce very little of real economic value.  The following comes from a recent National Review article….

By 2005, the federal government employed 14.6 million people: 1.9 million civil servants, 770,000 postal workers, 1.44 million uniformed service personnel, 7.6 million contractors, and 2.9 million grantees. This amounted to a ratio of five and a half “shadow” government employees for every civil servant on the federal payroll. Since 1999, the government had grown by over 4.5 million employees.

According to that same article, when you add in state and local government workers the numbers are even more dramatic….

According to the U.S. Census Bureau, there are 3.8 million full-time and 1.5 million part-time employees on state payrolls. Local governments add a further 11 million full-time and 3.2 million part-time personnel. This means that state and local governments combined employ 19.5 million Americans.

Yes, we do need some government.  For example, without any law enforcement at all our society would descend into complete chaos, and without any military at all we would be completely open to foreign conquest.

In order to have a stable, secure society we do need some government.

However, we definitely do not need the massively bloated government that we have today.

The truth is that most government employees are a drain on the system.  Most of them just push paper around.  I used to work in Washington D.C. so I know what pushing paper around is all about.

And as I wrote about yesterday, there are millions of other Americans that enjoy a comfortable existence at the expense of the federal government without doing any work whatsoever.

Of course the biggest welfare recipients of all are the big corporations.  All forms of corporate welfare should be eliminated immediately.

When are U.S. taxpayers going to get sick and tired of paying for all of this?

Every single year, the federal government, state governments and local governments drain massive amounts of desperately needed money from hard working middle class families.

Then they take that money and spend it on incredibly foolish things.

When are American voters going to stand up and boldly declare that they have been taxed enough already and they aren’t going to take it anymore?

The current tax code is completely and utterly broken and it is beyond repair.

Unfortunately, neither the Republicans or the Democrats are proposing that we should get rid of it.

So we are just going to continue to get more of the same year after year, and it is the middle class that will feel the pain.

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