Dependence or Independence?

America is coming upon a crossroads; choosing dependence or independence.  Recent studies highlight the dependency difficulties we face.  The biggest question is; does anyone in Congress or the President have the spine to do something before it is too late?  Or, is it too late already?  It is up to the voters, our voices, and communication vehicles to change the course of this country. Some have begun to push this knowledge out and share in respectful avenues.  Many Americans may not realize what our dependence issue is, because it is not being seriously addressed. America must make a choice between dependence and independence.

In my recent piece, Base-less...Boehner Shows His True Stripes, I discussed how the top 40% are now paying 106% of the Federal Tax burden.  Meanwhile, the bottom 40% are now saddled with a -9.1% "burden".  This is dependence at its' most extreme, using the government to steal hard-earned income to give away to others.  

An independent solution would be to revise the tax code.  Different groups have different preferences how to accomplish the overhaul.  There are several solutions, but the most popular major overhauls would be the Fair Tax and Flat Tax.  One can advocate for whatever they choose, but most Americans would agree that the Tax Code needs reform.

As discussed in Budget "Battle" Ends on an "Embrace the Suck", 65% of Americans agree that spending needs to be cut.  It is doubtful Americans are tying the spending to government dependence. Most people do not follow the numbers that closely.  Spending is a major driver of the loss of independence in our country.  We are bound by government spending and dependence.

Government dependence is a major driver of our deficit (now near $17 Trillion).  Some of the statistics, when charted, are simply astounding and scary.  For the small portion of the country carrying the weight of these government dependence programs, it is frightful. At 70% of the Federal budget, and growing, this is simply unsustainable.

The only independent solution is to educate those who have not been paying attention.  Every person has their favorite government program or handout or subsidy.  It must be understood that nothing can be off the table; defense, welfare, Social Security, Medicare, Medicaid, etc.  People have been trying, for years, to accomplish this with some luck.

The following charts illustrate just how expansive growth has been in government dependence.  An extensive study was just released in late November that details even more about government dependence. If you would like to read even more detail, it can be found here.

The choice is, become independent again as a society.  Or, be harnessed and dependent on the government.  If demands are not made, the government will not change course.  And, if the government does not change course, then these programs will be cut harshly when we run out of money.

Budget "Battle" Ends on an "Embrace the Suck"

In a anti-climatic way, the budget "negotiations" and "battle" have ended for the most part. Republicans, not Conservatives, caved, as usual.  It appears that fiscal responsibility is something only American households are supposed to embrace, not our Congress and Government. In the end, no one is a winner, except Government Bureaucrats who get to keep spending our hard-earned money in wasteful fashion.

How did all this go down without the partisanship and actual debate we would expect?  Easy, put Paul Ryan in charge of negotiations on the Conservative side of the budget.  Representative Ryan is respected among Conservatives for his fiscal plans.  Supposedly, this was to quiet the Conservative base. Mother Jones diagrams the solution in a way that is easy to see.  In reality, what happened was simply a political ploy to set themselves up for supposed winning in 2014.

Republicans did not want another shut down to be blamed on them.  They just don't seem to get it though.  No matter what Conservatives do, they will always be blamed by the biased media. The budget is one area where Republicans and Conservatives have strong support.  65% of Americans polled agree that spending needs to be cut.  So, why cave so easily and repeal most of the Sequestration cuts that were finally helping balance the budget?

It makes no sense, this "go along to get along" attitude. Republicans do not seem to understand that they leave Americans with no alternative to big spending Democrats. Americans are sick and tired of big spending government and want some accountability. This budget does nothing but appease the Left and Center-Left.  Where has being "middle of the road" gotten Republicans in recent years?  McCain and Romney were centrists who supported various big government approaches under the Republican branding.  Due to this, Conservatives did not turn out in numbers for the elections and they lost both elections.

However, Conservatives have been winning in droves at other levels.  Running on fiscal responsibility and smaller budget platforms, numerous candidates have won elections.  A recent poll highlights just how much support there is for Conservative solutions:

Ninety-four percent of voters agree that Congress needs to devise a long-term plan to address our national debt instead of relying on short-term fixes in times of crisis (83% strongly agree).

Ninety percent of voters agree that Congress’ inability to enact a long-term fiscal plan creates uncertainty about the future and has serious consequences for our economy, with many believing that the fiscal policymaking process in Washington is broken (86% agree, 71% strongly agree).

Fully 89% of voters say it is important (55% extremely important) for the bipartisan committee set up by the recent budget compromise to reach an agreement on the 2014 budget and an equal number (88%/57% extremely) say they must also focus on a longer-term fiscal plan to reduce the national debt.

Yet, here we are again; sitting with a budget that does little to nothing to curb spending. Republicans should have demanded more in return; within reason this budget should have included some major cuts to spending or entitlement reforms.  Instead, it raises spending above the Sequestration levels once again.

We have seen massive increases in taxes over the past few years, with little to no cuts.  The cuts included in previous budget deals have now been dissolved for the most part.  And, the problem is not tax revenues, it is purely a spending problem in Washington.  In 2013 alone, tax increases accounted for $188 Billion in additional revenue being collected. This 60% increase in revenue is not offset by spending cuts as recommended by Simpson-Bowles.

I am convinced tax increases should be removed from any and all budget negotiations moving forward. It is time to look at spending which is the major driver of our deficits and uncertainty in the markets.

Yet, Republicans just pulled the power of the purse away from themselves.  They just lost their negotiation power in what could be called worse than a sucky deal.  I, for one, do not "embrace the suck".

Warning Signs Regarding the Economy

The administration continues to try and keep us distracted from their utter incompetency. Meanwhile, facts and well grounded opinions abound, which undermine the very arguments made by the administration.  We must keep our eye on the ball, keep the pressure on our officials, and report what need be reported today. Do not be deceived by the rhetoric, lies, and misinformation of the current administration.

Just this morning, Tony Lee of Breitbart reports:

One of the fathers of modern finance and a winner of this year's Nobel prize for economics said the bloated deficits of the United States and European nations may lead to a worldwide recession.