Have You Ever Wondered
If our economy jumped from 1913 to 2013 overnight then heads would roll in the streets for months, but since the damage to our coin of the realm has been done incrementally, our heads just wag in pity at anybody that can't understand the natural change in the value of our small change.
Income Tax To Balance The Budget?
"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value." ~ Alan Greenspan
Copyright © 2004-2012
|People have been squabbling over the nature and cause of
inflation since time began.
What does cause inflation?
You've probably been taught that inflation is something that "just happens" to the economy. I shall prove to you that inflation is something governments do to the economy. That has been true for the last 52 centuries and it will be even more true tomorrow. It is also true that every government entity seeks ever more monetary donations from its citizens. I call it: "The Ransoms of War!" or --
Another Way To Steal
It is believed by many that Germany lost the first World War in the first place because the country ran out of allies and its economic resources were running out. Support for the war among the population had dropped dangerously low as early as 1916. By mid-1918 the Kaiser retained support for his war only among the die-hard monarchists – and the conservatives.
The one thing that overwhelmed the German economy was the entry of the United into the conflict. This provided vast industrial resources to the poor allies that were just about as broke as Germany was at that point. Despite an army vastly superior to what the allies fielded Germany foundered for a lack of financing. Without funds or credit it could not replenish artillery shells or ammunition, nor could it pay the military or even provide it with adequate food for a proper diet.
With an inflation of 3,500% per month raging in the 1920s, the Weimar government of Germany became notorious for its uncontrollable hyper-inflation. For example, a 1923-issue of the 50 million mark banknote that would have been worth about $12 million only 9 years earlier was worth approximately $1 when it was printed, but the note was practically worthless just a few weeks later because of even more inflation.
Germany's galloping spiral of vicious inflation was brought to a halt in a matter of days, though. How? Well, actually it was pretty simple. The government stopped printing new money. Second, the deutsche mark was again backed by gold and agricultural parity. The debacle was immediately over, and Germany found itself on solid financial footing once again. It was still broke from losing the war, but its inflation was reined in and genuine wealth could be created and maintained by the German people once more.
In an effort to end the Depression, Roosevelt claimed all the gold certificates and demanded all the actual gold Americans had. Then he sold the gold.
8 years later Americans were still so poor they were picking through garbage dumps for rejects. The only thing Americans still had was faith in FDR.
Franklin would save them.
Down in Texas recently a cattle rustler received 99 years for his rustling enterprise. Really now, I asked, 99 years for rustling a few cows? It seemed grossly unfair because I was thinking of how hard it is to rustle a few cows from a ranch. But our gentleman rustler wasn't cutting fences and rushing Texas cattle off over the owlhoot trail to New Mexico.
No,, Sir! Our gentleman rustler was rustling his cows with a few strokes of the pen, just like governments do. He made ranchers do the rounding up, and the shipping out and he simply "promised to pay" when the cattle were delivered. Most of the ranchers never collected a dime in compensation for their efforts.
The only difference between nations that rob their fellow citizens and the gentleman rustler that got 99 years is that nations can't be sent to prison. By the stroke of a pen the nations of our world can coin money they don't have, and the bigger the nation is, the bigger the crooks behind the pen can be.
We know that Alan Greenspan has said: "In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value."
Adam Smith, author of the still much studied book The Wealth of Nations published in 1776 says that historically "the avarice and injustice of princes and sovereign states, abusing the confidence of their subjects, have by degrees diminished the real quantity of metal, which had been originally contained in their coins."
Richard Nixon took US off the gold standard when an ounce of our gold could be bought with 35 of our dollars. He took US off the gold standard because too many people were turning our dollars in for our gold. The reason so many people were asking for our gold was that our U.S. currency was, and still is, the currency of choice around the world. There is this myth that our credit is still good. Therefore twice as many people outside the United States still hoard their money in U.S. currency.
As long as they continued to hoard it our money it did not have to be redeemed; therefore the government could print more dollar bills and no one really noticed that the figures weren't stacking up right. But, the less secure our money became, the less people wanted to hang onto it; they wanted to redeem the value they had invested in it before it became worth less. Nixon convinced Americans that the wise course would be to let the value of a dollar skid with reality. The reality is that the value of our dollarskidded downhill to the garbage dump and floated away. Kids could still buy a nickel candy bar for five cents in 1976; today you'd better give them $2 for that candy bar, and don't expect any change back.
Now, I'm no smarter than you are, but here's how I see the future shaping up if people aren't any smarter than I am.. As American inflation continues to accelerate and the value of our currency crashes, more and more people from outside the United States can be expected to begin cashing in their paper dollars. When the oil-rich Arabs convert their American dollars into Chinese Yuan there will be a stunning blow to our economy.
When our economy falters and faith is lost here so that some other currency is preferred, the yuan, or the Euro perhaps, at that point ALL those people will be demanding fair value for the money they bought, which is our money. Not counting the $232.5 billion that we owe Red China $300,000,000,000 will be cashed in for the Euro and suddenly US will have 3-4 times as many dollars flooding the market. Our floating money value will slink down the drain overnight. A run on OUR banks will devastate the economy our very lives depend on.
Compared to just fifty years ago, right now all the money you have
The dollar bill below is a SILVER CERTIFICATE. In 1976 it would buy an ounce of silver, and right this minute, one ounce of the precious gray stuff is worth $31.08.
Now, I'm no smarter than you are, but here's how I add this up if people aren't any smarter than I am.. It now requires 31 of our new dollar bills to buy as much as one of our old dollar bills would!
If we had used 35 of these dollars and bought an ounce of gold, right this minute, we would have $1683.00 to jingle. This would not have happened if our government of the people, by the people, for the people had not stuck it to the people and we (US) had made the government stick to the Constitution.
Article 1, Section 10 of the United States Constitution pretty well sums up what our founding fathers believed that money should be made of: "No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility." Emphasis is mine.
When states begin trying to bribe foreign business to set up inside their boundaries, what is the first bribe put on the auction table? You're right,, NO taxes for the first 5 years! And, why do so many crooked small business owners hire illegal aliens? Because then they can write off the cash wages as a business loss and pay no taxes on what they really earned.
Now, I'm no smarter than you are, but here's how I add this up if people aren't any smarter than I am.. If it takes $2 to buy what $1 did buy then I have lost half my money. Next year the same thing happens, and the year after that. It now requires 31 of our new dollar bills to buy as much as one of our old dollar bills would! But, besides that.. Every dollar I earn is taxed by the Federal government -- and every dollar I spend is taxed by the State, County AND City governments. That's what I call raking it in, going and coming. My pocket is where it is going and coming from. If your pocket feels funny then maybe the government is raking it in going and coming from your pocket too.
Now, I'm no smarter than you are, but here's how I add this up if people aren't any smarter than I am.. Taxes have driven honest citizens to harvest illegal gains. I find I am paying taxes every time I light a match, smoke a cigarette, down a drink, play a game of cards, go to a movie, to a show, or to a ball game, every time I take a trip on a train, bus or plane, every time I send a telegram or talk on the telephone, every time I surf the web, every time I buy groceries.. I'm paying taxes. Look at the figures; study the bottom line.. 45% tax on my income.. then 14% of every dollar I spend on groceries goes for taxes. 45 + 14 = 69% -- or 7 out of every $10 goes for taxes. That means that in the period from January through September I'm working for the public whipmaster. When I buy a car, taxes AND excise taxes. When I buy a home, TAXES ON TOP OF TAXES.
If this continues four more years then the day is coming when the poor man will be spilling blood at every step as he goes on working from the 1st day of January through the 24th day of December just to keep from going to prison for tax evasion.
There is no denying the progress we have made lately: The mail runs almost as fast today as it did in 1900: And, we only have twice as many people going hungry now as US did in 1931. People with a genuine ostrich mentality will insist on pointing out there are televisions today, computers, and paved roads from one end of the country to the other, not to mention hundreds of other wonders, like the Internet. But I ask you, who enjoys all those luxuries the most? It's that class of people that can sit around for weeks on end and don't pay taxes.
My thought on the other side of the ledger is that with all those things going for us we should be seeing an immense GAIN in wealth: and, If the lawyers and politicians had left our money alone, then I believe all these improvements and increased productivity would have created so much wealth in the United States that the whole world could not hold it!
The way I see it, our best magazines would still be selling for a dime, not 20 cents. Long after I was a grown man Reader's Digest was still selling for 35 cents on the news stand!
I maintain that ALL the progress we have ever made over the past two centuries can be traced to giving the common man more opportunity to gain wealth; it did not happen because he was being taxed to death. But maybe you won't take my theory at face value, so Let's Ask..
Brother Eli, did you invent the sewing machine because you were taxed enough? "Why bless my soul! What kind of embroidered fiction gave you such a silly idea?"
Let's ask again. Uncle Bill, did you invent any version of Windows because you were being taxed? "Uh, let me think here. No, I'm quite sure the answer is no. Well now, maybe it was yes because I was being taxed so much that I was struggling hard just to keep my head above water. I absolutely HAD to do something or I would have had to settle for 64K all the way."
Okay, let's ask again. Mr. Industrialist, is your company so squeaky solvent now because the government has over-taxed you so much? "Are you kidding? I have to hire eight new full time accountants this year and it takes twelve lawyers just to take a stab at complying with the 18 volumes of governmental taxation and stupid laws!"
Well there you have it from three different perspectives, and you still get the same answer.. Overtaxing US poor people is NOT improving the value of our money!
Opportunities to create wealth is the only thing man needs for progress to be made. Millionaire entrepreneurs are not essential.
Provide enough opportunity and God will provide twice enough opportunists. Here's a nice little couplet: If we just multiply the number of people who can make improvements we will subsequently multiply the number of improvements being made.
Here's another one.. The more hope there is to get ahead,
Okay, here's the way my own theory percolates.. when the little guy on the street believes there is no use to go on with his honest hustling then progress comes to a halt and the crack dealers proliferate.
|1929 is supposed to be the beginning of the
worst economic depression in the history of the world.
"Supposed to be? Why there were people starving to death, freezing to death, working themselves to death for a silver dime."
Yes. All that really happened. But it did not happen because the United States went broke!
"A conspiracy then?"
Actually it was probably just the reaction of natural law. As John D. Rockefeller said, "These are days when many are discouraged. In the 93 years of my life, depressions have come and gone. Prosperity has always returned and will again."
About the only thing all economists do agree on is that Americans must quit borrowing money. In 1928 the newly rich had been borrowing money to buy stocks they hoped would rise in price, delivering a profit big enough to pay off their loans and make them rich. They quit, letting the last spin of the roulette wheel of luck spin out what fate their luck would have them live with. They quit borrowing money to buy cars, quit borrowing money to move into town, quit borrowing money to buy homes and -- as a last straw -- poor people were losing the right to borrow money to buy groceries with. Times were getting hard, but only for some people.
To explore the Great Depression let's invent some definitions of money and explain the origin of money.
Now that we understand what money is and why scrip was invented we're almost ready to revisit the Great Depression. The Great Depression did not start in 1929; it started in 1913 when the personal income tax was invented and the Federal Reserve was born.
Before proving that America was still wealthy and far from broke I want to acquaint you with two "facts" of financial history.
|So, how do
we reach the conclusion that America was not broke?Before we heap any blame on the Government let's shed a little
historical light on the tearful situation.
Today we expect the Government to leap in at the first sign of any emergency and begin dispensing payola from its bottomless bag of bull manure. Before the depression, the whole state of Texas could suffer through a long, wrenching drought and not receive so much as a pack of seeds to plant a family garden in the following year. A sad shake of the head, a twist of the lips, and that was the end of that. Politicians as far back in time as David Crockett would have understood perfectly.
Things just weren't done that way. You took care of yourself or your self was not taken care of. If the dust bowl happened today you would see sympathetic agents rushing into the field to save the farmers from drowning. Back when it really happened Henry Fonda had to pay for the Joad family's own road map to get to California; and the Joads discovered the welfare department did not care if they lived or died when they got there.
Socialists like John Steinbeck, and communists like Helen Keller and Jack London, had to work strenuously to change the American public's inclination to keep charity on the personal donation level. Even the immensely popular FDR had to use subterfuge to aid and abet Governmental intervention on the personal level. His radical ideas shocked millions of voters; he had to tread carefully lest his own party supplied the rope to hang him with.
Can you see now how US could be wealthy, and still be unable to act like a Big Brother should? Good, let's move on to examine the circumstantial evidence proving US was still rich. Then we'll move on to the solid proof.
We'll start with the enterprising young man
Ford's Model A of 1927–1931 was not offered for sale until December 2, 1927. By 4 February 1929, one million Model As had been sold, and by 24 July, two million. You will note these fantastic sales figures happened during the roaring twenties with prices starting at $500 each. When production ended in March, 1932, 4,849,340 Model As had been made and sold -- in all styles. Therefore, 2,849,340 Model A cars were sold at a minimum of $500 each AFTER PANIC had seized the entire world.
Remember my theory.. nobody spends money unless they earn it or someone gives it to them. The conclusion is that in the worst panic ever to settle down on this nation, almost three million Americans had money to spend, LOTS OF MONEY to spend. Remember that the other automakers were also making and selling vehicles at this same period of intense uncertainty. Some Americans had to be making money -- How do we know? because they were spending it. You can't spend money unless you have it.
So, who was broke? Yes, you got it, the people leaping out of tall buildings who could not bear the prospect of working for a living. Why, they had actually been rubbing elbows with power players and millionaires!
Now, let's add the circumstantial proof of movie proliferation. In order to go to the movies you needed money, My theory is that if you had enough money to go to the movies then somebody had to earn it.
Millions of people were buying them, Therefore somebody had to be earning the money or it could not be spent. Does that sound logical to you?
"Pennies," you say? "Nickels and dimes," you say? Okay, let's fast forward a few years so you can count some big chunks of money.
Under the Lend-Lease Act a total of $50.1 billion (equivalent to $611,424,489,796 today) worth of supplies were shipped: $31.4 billion to Britain, $11.3 billion to the Soviet Union, $3.2 billion to France and $1.6 billion to China.
"Uncle Joe Stalin" ersatz friend of the immortal FDR said, "America will make the rope with which to hang themselves." He also said something to the effect that America would lend him the money to buy the rope. He wasn't far off the mark: Russia received 100 million tons of woolen and cotton goods, plus 15 million pairs of prime leather boots, 4 million rubber tires and tubes, 375,000 trucks, 11,000 freight cars, 15,000 airplanes, 7,000 tanks, and 2,000 locomotives. Uncle Joe is said to also have requested a few million condoms and specified they must be 18 inches long. FDR is said to have had the goods shipped in boxes stamped with the words, SIZE, MEDIUM. It was a nice chuckle among wealthy friends.
When you quit laughing, I want to point out that this donation to protect communism was a gift; US did not make a cent off these "transactions." There were no sales made because no money changed hands. We didn't even get good will.
Nobody owed US a dime; there was no debt because US gave it away! There were also a few other transactions where heavy equipment -- as big as battleships and as small as air craft -- changed hands and no receipts were issued. This was an entirely different program, launched in 1940, the Destroyers were nominally traded for bases. Under the Bases Agreement 50 USN destroyers were transferred to the Royal Navy and the Royal Canadian Navy in exchange for basing rights in the Caribbean.
So, follow my reasoning here.. we didn't sell any of this; we GAVE it away! Therefore, America was rich enough to give it. Since we were in the middle of The Great Depression and NOBODY had made any money in the past 12 years -- since we were STILL in the Great Depression -- then, obviously, US were far from broke when the Great Depression started.
What IS Wealth?
I discovered Ted Pierce was wealthy when he and I met Shorty Davis. Shorty said, "Working hard, Ted?" and Ted said. "Yeah, I'm not rich like you." Idle words I would have thought. But suddenly the conversation turned real.
Shorty replied sadly, "I'm not rich, I'm not even wealthy. You -- on the other hand -- may not be what you call rich yet, but you are already wealthy, while I never will be wealthy or rich again.
"You own all your heavy equipment, all your vehicles, Ted. All your houses too, and you could borrow money from any bank in the state without offering collateral.
"I -- on the other hand -- owe $240 million -- which wouldn't be any big deal except that every banker in the state would drive a hundred miles out of his way to avoid me."
Rich governments have been claiming they were broke for a long time. For
Good Old King George said US had to help pay for the French-Indian War that had put
Canada into his pocket. Yet he could still dish money out of a bottomless
pit to finance his side of the War for Independence. Alex Hamilton said
western whiskey makers had to pay for the
Revolutionary War, and to make them pay it he raised an army bigger than the
Colonies had in the field to get rid of the British. George W. rode at
the front. In less than 4 years even EASTERN whiskey makers had to be a
tax on whiskey. Every drop of whiskey you drink still has a tax on it; US is still
trying to pay off that old War For Indepence debt. The next thing you know there will be
taxes on our tobacco and it will even be against the law to spit on the sidewalk.
New York's upper crust is now paying 52% of its
income for taxes
But that's not the sad part. The sad
part is that every cent of their money is wasted because the government will have to
borrow nearly 50 cents for every
dollar it spends this year,
thus exploding the record
federal deficit past $1.8 trillion under new White House
estimates to $3.73 trillion. Budget office figures released Monday would
add $89 billion to the 2009 red ink — increasing it
to more than four times last year's all-time high as
the government hands out billions more than expected for
people who have lost jobs -- and takes in less tax
revenue from people and companies making less money.
Hitler needed an entire army of brown shirts before he cowed the sissified German people into submission. Over here in the land of the free and home of the brave all it took was the Internal Revenue Service. Hitler's Storm Troopers didn't even come close to making goosebumps as big as the IRS does. Armed with the THREAT of their nine million page manual, friendly little, beady-eyed Internal Revenue Agents can bust into your home and steal all the money tucked away under your mattress and make you testify against yourself just as if the Constitution had never -- ever -- been written.
Every pre-war German still alive will testify under oath that THEY resisted. Over here even tough guys like Al Capone folded under the pressure of IRS agents.
If you haven't captured the moral of that story yet, here it is in plain English.. The ONLY PURPOSE of individual taxation is simply to intimidate the American citizen. It's kind of like the purpose of Boot Camp in the military. "We tear men apart so we can rebuild them into soldiers," is how the recruiting sergeant said it to my grandson the other day.
The ONLY reason we have 9 million pages of tax opportunities is to create confusion in the tax payer's mind. Here's the proof.. Individual taxation is not necessary when the Gov discovered it can simply print new money at will, or raise taxes on alcohol, tobacco, firearms or gasoline.
In 1848 Abraham Lincoln noted that a good man could earn $10 per month. President Lincoln invented the federal income tax in 1861 in order to finance the Civil War. Being a very wise man, his plan only taxed the rich and wealthy. That made everyone feel safe and secure from having to contribute. Remember, anyone that could claim $90 per year in earnings back then was one of the big buck earners. Lincoln's bill called for a 3% tax on any resident with an annual income exceeding $600 -- Taxing rich people has been all the rage ever since.
But, our government was too efficient. Acting independently of party dogma, Chester A. Arthur, our 21st President, tried to lower tariff rates so the Government would not be constantly embarrassed by annual surpluses of revenue. This Federal budget surplus had been accumulating since the end of the Civil War.
The income tax law was voted out in 1872. It was tried again in 1894, but declared unconstitutional in 1895 President Taft proposed a new constitutional amendment on June 16, 1909 in an address to Congress that resurrected both on individual taxes and an excise tax "upon the privilege of doing business as an artificial entity and of freedom from a general partnership liability enjoyed by those who own the stock"
On February 25, 1913, the Secretary of State, Philander Knox, proclaimed that the amendment had been ratified by the necessary three- -fourths of the states, and thus had become part of the Constitution. Subsequently, the Revenue Act of 1913, an income tax of just 1%, was passed by the Congress. BUT, ONLY THE RICHEST PEOPLE HAD TO PAY IT.
US was promised that only an innocuous 1% tax on the rich was to be collected. Furthermore, US was GUARANTEED IN WRITING that income taxes would never rise any higher than 7%even on the rich. You know what? A few of our treaties with the American Indians lasted longer than that! Once it was realized that Americans had no backbone, taxes began to rise by leaps and bounds. Just eighteen years later that tax stood tinkering and tottering on 25% -- I'm not any smarter than you are but that looks like Americans were being taxed at least 25 times as much.
At least? Well, yes. US was now throwing tax shackles on the wealthy citizens of the United States, not just the rich.
Here's how it unfolded. The government tried a measly little 1% income tax only on the rich and yet Congress was uneasy about possible reactions to the new fangled method of deteriorating our money. When no sign of an honest rebellion ensued, the tax was quickly doubled and a confiscation of 2% became standard fare, and even then, only on the rich.
I'd be a lot richer if 2% was all they took from me today, wouldn't you? 2% instead of whatever you are paying, what? 40, 54%? I have 6 daughters and one of them is paying 62%!
Congress has scudded up to 67% off the time-honored pledge that it was only going to SOAK THE RICH. At first, only 00.7% of the population was part of that RICH portion. Then in rapid succession the back rooms of Congress designated "rich" to mean 3% of the population, then 10, 17, 25, 30, and 70, and now it's all the way up to 92% of US are singled out as being rich enough to afford the privilege of paying taxes. Where will it end?
Little Brother, it will not EVER end. You should have seen it coming when ditchdiggers found out they were wealthy enough to pay taxes. Just 2 years ago Congress was publicly threatening to raise the tax to 75% on a certain few individuals if they didn't behave! Little Brother, you just give Congress 15 more years and ALL OF US WILL BE PAYING UP TO 75% of our income in taxes if we don't behave! However, in order to keep some money in circulation you will see citizens being taxed only half as much, but having to pay it twice a year.
After 1913 the canny rich began migrating their wealth out of visible means of support. Because of taxes there was a wave of tremendous opportunities for the "middle class" to scoop up bargains left behind in stock. Unfortunately, the reason people are only middle class or poor is that they don't know how to handle their money. To wit, they spend it on unnecessary products and foolish pursuits. One know-it-all in college told a grandson of John D. Rockefeller.. "If my grandfather was that rich I'd be buying everything in sight." The grandson responded, "No you wouldn't." Then he went right back to waiting on tables. Rich people KNOW better than to spend their money!
Not only did poor people spend their money unwisely, but newly headed corporations began throwing money around and the biggest bubble of wealth in the history of mankind unfolded around the world. There was a big boom, and the inevitable little gentle bust converted millionaires into apple peddlers overnight, if they lived that long.
During the Great Depression that "Indomitable Citizen of the United States" meekly put his face down deep into the mud and kissed the hand that bit him until private assessments of up to 60% are now meekly accepted with gratitude; "At least I'm not rich enough for it to be me!"
Along with losing the right to own our own property US lost the right to privacy. Tax collectors can now bust into your home without a search warrant and confiscate all your papers, receipts and deeds in an effort to ascertain just how much THEY think you MIGHT owe in income tax.
Don't believe for one second that such invasions only happen to men like Al Capone; ANY citizen of the United States can be so invaded and property confiscated, sold at auction and then that citizen made responsible for any subsequent indebtedness guessed at and decreed by the invading agent -- and many are if they don't latch onto a crooked lawyer mighty quick.
"Oh come on now; they HAVE to make assessments by law."
The Feds didn't do that with Al Capone, and because US let them get away with it, now they don't have to do it with US either. The IRS goes by estimation and inclination just as it did with Al Capone. Look, if they had assessed Al on what he actually owed; he could have paid it and laughed at the system on his way out of court. Back in 1931 the highest collection rate (remember, it was imposed only on the richest people in America) was a mere 25%. However, sales tax was nonexistent in 47 states. People that still had money could still afford to spend it.
I'm not saying Al didn't deserve the nick, I'm saying it wasn't honest the way it was done by the Feds. By the same token, when you go standing on your rights you will get socked in the gut much harder than if you meekly kneel down to put your face deep into the mud and kiss the dirty hand that bites you.
I repeat: The ONLY purpose of individual taxation is simply to intimidate the American citizen. It works. Every Time, it works. In just the last few years, the amount of individuals and businesses with unfiled and unpaid back taxes has swelled to over 20 million people that are still facing the chopping block. That, Little Brother, is roughly 1/3 of the adult tax-paying population. Joseph and the Pharaoh of Egypt are the only immediate candidates for a more comprehensive collection agency.
Here's PROOF: By eliminating individual income taxes and the IRS bureaucracy the American public would save US 2 trillion dollars annually, in addition to the $11 billion in annual IRS operating costs. Where do these figures come from? From adding up the cost to citizens to prepare their taxes and to businesses for purchasing legal beagles and accounting personnel to help them cut down on taxes. We also have to be careful with using these figures because if our taxes ever are actually lowered substantially there will be a burst of production in a vain attempt to keep pace with consumer spending.
Taxes have destroyed
|Item and amount||Cost,
|Item and amount||Cost,
|Meat and Fish||Fruit|
|2 lbs. flank||$ .32||3 qts. apples||$ .27|
|2 lbs. chuck||.40||3 oranges||.12|
|½ lb. bacon||.21||4 bananas||.15|
|1 lb. dried cod||.20||½ lb. raisins||.12|
|1 can salmon||.27||1 lb. prunes||.24|
|Dairy Products||Bread, Cereals, etc.|
|1 doz. eggs||.61||12 lbs. bread||1.28|
|1 lb. butter||.66||2 lbs. flour||.16|
|½ lb. oleomargarine or lard||.18||1 lb. corn meal||.07|
|1 lb. cheese||.41||1 lb. rice||.16|
|14 qts. milk||2.10||1 lb. macaroni||.16|
|Vegetables||3 lbs. sugar||.33|
|1½ pks. potatoes||.77||3 lbs. rolled oats||.21|
|3 lbs. carrots||.12||1 pt. molasses||.12|
|2 lbs. onions||.13||Tea, Coffee, etc.|
|3 lbs. cabbage||.14||¼ lb. tea||.15|
|2 lbs. dried beans||.23||½ lb. coffee||.23|
|1 can tomatoes||.15||½ lb. cocoa||.22|
|Total weekly cost||$11.00|
They started small and worked hard.. In 1924, before modern factories and the miracle advances of super electronics were on the scene, merchants, suppliers and manufacturers could all make a profit on a pair of pants which sold retail for one dollar a thousand miles away from the factory. And there was NO sales tax for customers to fork over. Today the same quality of pants sell for $30 -- $70 a pair. If they come ripped and torn the price is a little higher.
Let's do some more counting: At 10
cents an hour it took 10 hours of work by the common
back to buy a pair of pants in 1900, but let's
remember that was
with no taxes to fiddle with.
At $4.25 an hour you'd still be working a whole 7.06 hours for that pair of pants.
Yes. Yes, I know -- you are impatiently frowning at my stupidity already, but we're not through counting yet.
From that $4.25 per hour before you can spend it -- because of increased taxes -- you only get to use $2.39 for spending purposes. Therefore, in actual spendable income, when you revalue today's scandalized buck so you can compare it with yesterday's slightly sounder dollar you are only earning $0.096 an hour. That means that in spite of all the modern technology we now have that has increased productivity 340%, today's common laborer is earning less than the common laborer of 1900 was at ten cents an hour! That's right. In real money US poor people are earning less than a dime an hour.
Okay, Okay. I'll concede that today's pants do look better on women -- if you will concede that by adding in the 14% sales taxes collected on that $30 pair of pants to our figures here – that the year 2000 workers would be even worse off.
"But wait a minute," you say. "That isn't the same money. Some people were working for 10 cents an hour back then, today they won't work for less than $6.25."
Old Buddy, the problem here is that it IS the same money. You look at it.. You study it good.
One dollar back then still had the number 1 in front of it, just like the one dollar bill you see today does. There are NO changes there. One dollar then was written the very same way it is today. $1.00 You will find NO CHANGES THERE EITHER!
The only change is how much highway robbery the American public is willing to overlook now. Let's look back to a really bad era in America. In an effort to describe how badly things had gone for the Confederates it was published that a cord of wood was selling for $60 -- Well, hoop di deux. Today just a rick of wood (not a cord) regularly sells for $60.
No, I'm sorry. It's worse than that: Today the hewer of fire wood has access to chain saws, trucks, and modern highways -- and even with all that going for him, it still costs $60 to get half as much wood. In other words.. we need to surrender to Washington before we are stripped of every chip of kindling we will ever own.
If things keep going like this --
What does our future look like?
We Will Have Money,
We Will Have Wads of Money!
I am sorry to report that we are not finished laundering the bad news about money yet.
Here's another lie you hear every day!
The national debt doesn't
The Outstanding Public Debt
as of 17 Aug 2009 at 09:37:51 PM GMT is:
The estimated population of
the United States is 306,752,611
But, it doesn't matter, because we oweall this money to ourselves!
I keep hearing this myth -- and Yes,
I do maintain that wet-noodle excuse for not thinking is a myth. If
we owed all that money to ourselves it would be quite painless for US if we just
tell our Congressional Representatives, "Please put forth an
initiative letting us Forgive Ourselves Of This Debt. Just
write it off the books and let's quit charging ourselves all this
Well, somebody's in pain, and if we can find out who is screaming because we forgave ourselves this debt then we will know who the National Debt is really owed to.
Even though we have been told for all our lives it was just owed to ourselves somebody else is screaming.. therefore we are not the ones that the National Debt is owed to. Why -- I believe that scream is coming from across the ocean. There must be somebody over there that thinks we owe all this money to them.
The National Debt has continued to increase
Next month, the United States will pay $208 billion in interest alone on the National Debt. That is just the interest.
Why do you believe this lie that we owe so much money to ourselves?
In the latest home investment fiasco Hillary Clinton, then a first term New York Senator, said the Federal Housing Administration
First Term Senator Clinton then gushes on to reassure us: "It would not
require a single new government bureaucracy, and would be designed
to be self-financing over time -- so it would cost taxpayers nothing
in the long run," she explained.
What was that she just said?
Why do you suppose she would want to add this stipulation?
Why the fair lady tells us herself:
"Many mortgage companies are reluctant to help families restructure their mortgages because they're afraid of being sued by the investment banks, the private equity firms and otherswho actually own the mortgage papers," she said. (My emphasis)
Oh, so it's the investment banks, the private equity firms
and others who will profit from this measure! she is proposing!
(Remember, You can always tell who is benefiting most from any law by listening to see who squawks the loudest when it becomes threatened)
Whose economy will be helped by measures like this? the investment banks, the private equity firms and others.
There are now 9 different videos
like the one above, incredibly enough, all of
them are portraying China as the bad guy.
That's kind of like my buddy John that made it
through the winter months by buying groceries on
credit from Cecil. November rolled into
April and John owed Cecil big time bucks, and
moved on to buying groceries from another
source on credit. Angry and frustrated, unpaid Cecil
sent a friend to find out why John wasn't paying
his bill. The answer came back, "Why, Cecil won't even wave at
me any more, why should I pay him?" From
then on when Cecil met John on the highway he
would wave his hand back and forth all the way
across the windshield. Still no money was
forthcoming so Cecil sent his friend back to
find out why. "Cecil is waving at you just
as hard as he can."
and I just want to see how long he continues to wave at me --
without getting paid."
China did not make US go into debt with it; our greed did. US made Treasury bonds available to China because there weren't enough fools left in our country to keep playing footsie with a currency already bankrupt to start with.
Is the U.S. the only country playing footsie with its economy? Oh no. The United States is only moderately deep in deux-deux and has only a mere $12.3 trillion worth of external debt and a $14.6 trillion GDP for an 84% debt-to-GDP ratio. Switzerland’s external debt of $1.3 trillion equals 433% of its $300 billion GDP. The United Kingdom’s external debt of $10.5 trillion equals 456% of its $2.3 trillion GDP. Ireland’s external debt, at $1.8 trillion, equals 900% of the country’s $200 billion GDP.Do you have the nerve to drop down into Greece -- or South America and ask how well those governments are doing at being honest with their citizens?
Sometimes I get to thinking
every politician on earth
|If you ran out of gas on a trip when I was a kid you could
your spare tire behind and raise enough gas to get home on. Today you can't
even leave your car behind for enough gas to get home on!
Maybe you remember when a quarter was worth a gallon of gas? You could take a dollar down to the gas station and buy four whole gallons of good gasoline! Not only that, the station attendants washed the windshield, checked the oil, and inflated the tires properly without asking for more money.
At that time our dollar was still backed by copper, and by real silver, and even a little dab of gold when necessary.
The green stuff that the Fed fobs off on you now won't even buy a fistful of Monopoly Money.
Why Do US Keep Printing More Money?
"We NEED MORE MONEY circulating!" That has always been the government's excuse for printing more money. The real reason is the exact opposite; It is much easier to print more money than it is to pull teeth out of tax payers. Indeed, it would be much, much easier to print more money than it is to raise taxes -- but the myth must be continued that "We are going to make rich people pay for this whether they like it or not."
That sounds ominous for the wealthy, doesn't it? But take heart, It's time to display the good news. 97% of the people in Congress have become wealthy, and I don't see a single one of them becoming more destitute. Do you?
Here's another myth; Money makes the world go round, therefore we need to print more money to go around the world. Is that a true statement? No, huh, uh! Printing more money just makes money worth less, and that cheats the poor people that have worked hard for their money -- and poor people are what makes our money valuable. Way back in 1935 when our friend Rooseyvelt confiscated all the gold still left in America, what we should have done was make our money more valuable BY DIVIDING IT.
Yes. Money is a lot like real estate. If you have a thousand acres worth $1,000 an acre you can make it far more valuable by DIVIDING it up so more people can take advantage of it.
“How can you divide money up?”
Take the good old American dollar. It will have to be an old dollar because the Representatives of the people have been savaging our economy for their friends ever since Hamilton got his face plastered on a piece of paper. So yes, let's go back to gold for just a moment. Tricky Dick said he had to take US off the gold standard because there wasn't any gold left to back up our dollar.
I won't go into the stupidity we the people let bring us to that point. Let's just make it status quo. Virtually every ounce of gold we had has been shipped off to pay for our little affairs outside the country. Yes, yes, don't argue this point. If we had owed it to anyone in the United States our gold would still be here. It might not be ours individually but it would still be here with men like Charles Schwaab grinning broadly while we paid the rent for the storage shed that protected their gold.
But I will say that the only reason our gold was frittered away is the same one that has our country bankrupt today: we (collectively) have been spending more than we earned.
When Truman found out he could raise the debt ceiling by telling US we could pay it later he introduced the science of buying votes on our credit. Subsequently, he had four times as much money to spend as ALL the Presidents before him.
Okay, let's get back to status quo again so we can take off in a different direction. The status is that 35 paper dollars were worth an ounce of gold before Tricky Dick tricked us off down the primrose lane. But let's go down another lane and divide our money up so as to make 10 paper dollars worth an ounce of gold.
“Huh? You're going in the wrong direction.”
Oh, if we had started behaving ourselves in a sensible financial manner before Roosevelt burned crops in the field or confiscated our gold then we could have done this one little step at a time. $34 an ounce, $33 an ounce, $32 an ounce.
You know, one step at a time, we could have made our money more valuable, and because it became more valuable – like real estate does when it starts getting scarcer and when we need it more – we could have sub-divided it.
You younguns will have to imagine a time when a silver dollar was made out of silver but I can assure you that once upon a time our money was so valuable that a single dollar bill would buy an ounce of silver, and a quarter would buy – HEY, a quarter ounce! Amazing what systems those old fogeys dreamed up, isn't it? Let's drop on down a bit here and invent pennies that are worth their weight in – copper. YES! Once upon a time, our three-legged money was backed up by three basic metals.
A $1.00 bill would buy 1/35
of an ounce of gold.
I'm only 68 years old and I can personally remember vividly being able to buy two pieces of candy for a penny. 60 years have passed, you take a penny to the store today and tell me how much candy you can buy.
But, if we had come to our collective senses and sub-divided our money back then, today a penny would have bought a pound of candy.
That kind of thinking boggles the mind, doesn't it? It's about the same feeling George Washington would have experienced if he had been told that one fourth of an acre could be worth a million dollars. Why, his wooden teeth would have fallen right out of his mouth, his incredulity would have been so great.
“Where? Where at is this property so valuable?”
New York, New York City to be even more precise. George, these little wooden buildings will be chopped down for firewood and up, up, up higher than the tallest tree you can imagine, will sprout these buildings of steel and concrete that can hold thousands of people at one time – thousands and thousands of people at one time, and every one of them can be taxed to pay the President's salary and buy him some of your favorite wine.
By this time George has gone out cold and is stretched full length on the concrete sidewalk. Let's step around old George and hop on down this new trail we have discovered.
Yeah, let's throw our shoulders back bravely and be REAL proactive here, since you haven't fainted yet. The reason money fuels the economy better than barter is because it changes hands easily. Once upon a time 35 paper dollars was worth an ounce of gold. We need more money to change hands so everyone can feel like their palm has been greased. So let's make 35 CENTS worth an ounce of gold. If you think of this step like real estate you won't be lying down there beside George on the sidewalk.
Now remember, we have only gone back a few short years. Good britches only cost about $5 a pair back then – No, no. That's wrong.
Back then, 5 paper dollars would have bought a good pair of britches, I think you call them jeans these days and you pay from $50 to $250 for almost the same quality I used to wear – my britches sold for $5 but your jeans go for $50; who was smarter?
So, what we are going to do is sub-divide our money so that PANTS can be bought for 50 CENTS again. In other words, after sub-dividing our money, 50 cents are now worth a pair of pants. Same quality, and they look just as good on girls as ever, wonderful, huh? Wonderful, gleaming, brand new financial policy – sub-dividing our money.
Let's grab that penny by the nape of the neck and shake it a few times until it is sub-divided into 10 units that we will invent the word MILLS for. We now have some new coins to work with. 10 of them would be equal to one penny. No wonder people are willing to work for 7 cents an hour. You will realize that when people are willing to work for 7 cents an hour then 7 cents is worth an hour of labor. American farmers never would have let Roosevelt burn their crops if their money had just been sub-divided. Onward >>>
In our sub-divided money we will also have a 50 mill piece and a 25 mill piece, a 10 mill piece and a 5 mill piece. That would make a penny as good as the dime was yesterday. George, are you still down there on the sidewalk? Stand up like a man and look at this new money we've got. That worthless piece of paper with your picture on it is now worth almost a whole dollar again!
Why call our new coins “mills?” The word mill goes hand in glove with a basic unit of taxes called MILLAGE. If the tax collector accepts them, who can argue with the name of this neo-terminology?
“Okay, we have sub-divided our currency, Now the farmer can pay off his mortgage for ten cents on the dollar. Now, WHO is going to work for less than they were getting?”
Well, I'm glad you asked. Let's start with those public-spirited servants in Washington D.C.. I'm sure they'll be glad to work for less than they do now. It makes sense to me that we start out by paying them what they are worth and see where we go from there. Oh, and strip away all those perks too that they have gotten so used to -- great retirement -- wonderful health care -- the whole nine yards.
“Them? Take a pay cut? Why Lin Stone, that's the dumbest thing you've said today! Them people want more bonus for all the mistakes they make than if they had run a big corporation into the ground!”
Why, that can't be right! Back in 1847 they were glad to earn just $8 per day. Why shouldn't they be happy with $80 a day?
But, I guess you're right.
We might have to take a club to them.
There wasn't enough taxes to fiddle with when wages
were stopping at 10 cents an hour at the
turn of the 20th century. Even as late as 1942 sales taxes were
still only 1/10th of a cent per dollar in most areas. Today the average wage earner is
paying 31.2% in taxes on every dollar earned, according to the Wall
Street Journal. From 1800 until 1942 the value of money remained
relatively stable -- or at least they did when compared to the financial explosions in our recent history. From 1942 until 2000 your one dollar bill
literally became worth ten 1942 cents. How much is it worth today with
ANOTHER 691,000 American jobs going overseas this year and 20 millions
of illegal aliens stealing the jobs that were
supposed to be left to keep US poor people from
want you to take a good look at what's been happening --
So here we go over the mountain top and nothing in view but a steep, downhill slide. Every level of government known to Americans is reeling in a death dance with impossible debt. Ever since 1913 US has been told to donate more, and more and more. But ask yourself this,
Has it helped us poor people any?
He also said something even more profound.. "In politics, nothing happens by accident. If it happens, you can bet it was planned that way. ~ Franklin D. Roosevelt.
The Minimum Wage Myth
The easiest way to pry more of our money from our pockets was
to persuade US that we had more money for them to steal,
therefore Presidents and Congress keep shouting about the
necessity of raising the minimum wage -- as if that were
going to help US poor people get over what the Government is
doing to US.
The Typology of Financial Scandals.
Can you recognize a scam?
"Money is better than poverty,
if only for financial reasons." Woody Allen
|This country, with its institutions, belongs to
the people who inhabit it. Whenever they shall grow weary of the
existing Government, they can exercise their constitutional right of
amending it, or their revolutionary right to dismember or overthrow it.
-- Abraham Lincoln.
Well, for goodness sakes,
The ones we have
EVERY MAJOR WAR
has precipitated a departure from the gold standard
and the advancement of legalized counterfeiting.
Nothing generates enthusiasm like seeing genuine hope instead of tricky promises. With more money out there to grab, more people will be hustling to get an honest share of the increase. Even those whose ventures fail will be throwing money back into the system at the grass roots where it is needed. Those whose ventures succeed will be creating more wealth at the ground level by working more efficiently than ever before, which is the very foundation of our national wealth.
Henry Ford perfected the process of deliberately putting more money into the hands of common laborers. Suddenly, the best people anywhere wanted to work for Ford.
This galvanized his entire operation.
More importantly, it gave
common people money to spend right where it did the economy the most good. Unfortunately, when the government saw that workers were earning more, politicians began wanting more than their share.
Our government did all three, then did it again, and again, and again.
This isn't anything new. It has been going on since long before William the Conqueror was a little baby.
If our money had at least been founded on something of solid, substantial value, it would have taken much longer for our pockets to come up plumb empty while Congress is voting themselves yet another pay raise and inexplicably experiencing a dramatic increase in the fortunes of their family and friendly cronies at the same time. To stop this travesty of justice, our monetary system must be founded on a commodity whose value never changes; and we must cast our tax structure in concrete so that it never rises.If there were just some way we could make sure the value of our money is always the same, then the price of everything else will always reflect the precise value of that product or service to our society at that time. Consequently, the true value of the gross national product our country is able to produce would only rise and fall in the absolute terms of genuine wealth, never in false hopes or glittering promises.
Gold won't work.
Nor will silver.
When gold was our standard, Fort Knox was flooded with
the stuff and it wasn't even earning interest.
(All the gold we do have left there now is in hock.)
Keeping our gold bricks in a dungeon
didn't keep the dragon on a leash.
Our gold was just sitting there useless when it could have been working to make us more wealth.
Where is the sense of that?
If there were just some way we could make sure the value of our money is always the same, then the price of everything else will always reflect the precise value of that product or service to our society at that time. Centuries ago, in the still widely studied book The Wealth of Nations, Adam Smith makes these shrewd observations: "The real price of everything, what everything really costs to the man who wants to acquire it, is the toil and trouble of acquiring it."
He added: "By (measuring) the quantities of labor we can, with the greatest accuracy estimate it both from century to century and year to year."
In other words.. If we had to work an hour to buy a pound of sugar in one century and now we have to work two hours to buy a pound of sugar in the next century then we have lost half our buying power and we are working twice as hard as we used to be – no matter how much bigger the figures are on our paychecks.
As Adam Smith so ably points out, this precise kind of measurement cannot be done with any other substance on earth! The cost of everything we have can be measured by how many hours we had to labor in order to purchase it – not just the sticker price ($0.99) but the sticker price PLUS the taxes. ($1.13) Now, with modern technology assisting us, the work can get easier, but within an earthly frame of reference, time never changes. An hour only has sixty minutes in it. A minute only has sixty seconds.
Therefore, if we anchor
the value of our dollars
to units of time spent in labor
then our economy is locked into reality.
To begin anchoring our money to time all we have to do is make the value of one dollar equal one hour of time at work.
One of our hours of time would equal one dollar. If every dollar you earn today is worth one hour of time when you retire then every dollar will still be worth one whole dollar even one hundred (or one thousand) years from now. In fact, if technology continues to improve, a dollar will actually increase in value. But, it will still be worth one hour of time.
Each one of us has 24 hours of time allotted to us each day. No one has any more than that. None of us receives any less. We are all equal in this respect. Through diligence, leverage, practice, training, education, efficiency, planning, or strength each of us has the opportunity to make the results of our time invested in work be of more value than the results of time at work invested by those around us do.
That is immaterial to the equation.
Time has not been stretched, or altered.
We still only have the same 24 hours others receive.
So, let one hour of time at work equal one dollar.
Let one dollar be worth one hour of time at work.
Obviously, if one dollar is to be worth one hour of time then
someone must be willing to provide one hour of work for that dollar.
There are those who (forgetting the all too recent past) will claim that one dollar an hour is too little to work for. That idea comes from looking at one of the paper dollars in our midst today, which won't even buy half a loaf of good bread.
However, just as a pair of pants was only $1.00 when wages were 10 cents an hour, if one dollar is worth one whole hour of work, then it necessarily follows that one (time) dollar will be worth enough to purchase just as much pants that one hour of work will now produce.
After the conversion happens all of our numerical prices will rearrange themselves to fit the new value of our currency.
Better yet, as the results of our labor improve, the purchasing power of our money will increase.
|The question comes up to many a mind, why not make one hour
of time worth $10 so that it looks like we're earning more now
than we are.
That would be great, psychologically.
Unfortunately it would also put a devastating strain on the value of the coins we have to manufacture. If our wages are one dollar an hour then a penny made of copper would cost far less than a penny to make. At $10 an hour a penny made of copper would cost us far more than a penny to make.
We must save our pennies,
to keep Benjamin Franklin happy.
This will accomplish two important goals.
#1, it will insure that the elderly and the poor
can always get work done for them inexpensively.
#2, it will guarantee that prices for wages, goods and services are always quickly stabilized in spite of swings caused by fluctuating supplies and demands.
General, common wages cannot go up excessively because people
can have their money redeemed at one hour per dollar at any
time. Our wages cannot fall below $1.00 per hour because the
dollar is redeemed with labor. With our wages stabilized along
with expenses, vendors will be compelled to maintain lower
prices in order to remain competitive.
|This is done by a citizen conscription.
Anyone wishing to obtain citizenship shall, besides the requirements already made for naturalized citizens, be required to provide One Hundred Hours of their time to the labor pool. Only by freely providing these hours can anyone become a citizen.
As each call for a redemption comes in, the next person on the list goes out, even if the grease trap needs cleaning or a yard raked. No more than 8 hours a day would be required of anyone at a time. When not on call, people in the pool could work anywhere else. However, their citizenship cannot become operative until all one hundred hours have been submitted.
Only those who value citizenship will put forth the effort to become citizens, thus ensuring a better class of voter. As their desire to become citizens is the power which provides the value of our currency, hard working new citizens will be welcomed. To make citizenship even more meaningful, only full citizens can own real estate, vote, hold public office, or possess firearms.
Once their price for citizenship has been paid, any citizen
may return to the labor pool at the head of the line for as
long as necessary to sustain themselves until able to earn a
living elsewhere, only now they KEEP every dollar they
earn, and the Treasury does not get a cent.
Once you obtain talents, skills, or resources which enable you to command better pay than $1.00 per hour then you are encouraged to do so.
And those people good enough to start and maintain their own business shall have that privilege jealously guarded. In the great spectrum of labor, each band shall be regulated according to the skill values set from within their own ranks. Like the guilds of old, each band of the spectrum shall establish their own standards of performance, anyone meeting those standards cannot be denied membership.
While anyone can change guilds as the monetary rewards fluctuate, no one can be a member of two or more guilds simultaneously without forfeiting the financial remuneration guaranteed by the guilds. To wit, each guild shall collect enough from its working members to pay all of those at the same rate who are not working.
By dropping the price of wages the guild will put more
people to work. When there aren't enough people in the guild
then wages will go up to entice others into it. The minimum pay
allotted to each rank they establish will be set by supply
and demand for that particular talent, on a regional basis.
When too much work is available, guilds will
raise wages across the board in order to induce more workers into
that field. When the supply of workers exceeds the demand
that rank will be compelled to reduce their acceptable
wages across the board.
When grass needs cutting,
In conclusion -- Giving ourselves a dollar founded on
honest value will
Remember this for a fact..
Only when we put a ceiling on what Government can waste
It is time
to make the government stop playing games with our
Please continue to tell your friends they can find this article at http://www.talewins.com/essays/money.htm
Then ask your representatives to quit monkeying around with your money.
EPIGRAMS ABOUT MONEY
Great countries that go off the gold standard do not stay great for long. -- Ronald Reagan
What this country needs is a good five-cent cigar. Thomas Riley Marshall
You shall not press down upon the brow of labor this crown of thorns, you shall not crucify mankind upon a cross of gold. William Jennings Bryan
Once upon a time, government budgets were balanced, our money was sound, the streets were safe, and taxes imposed by all levels of government took less than 10% of our income. -- Harry Browne
Some Resources to take your mind off your pains.