Our family is doing pretty well. We can pay off loans and are trying to knock out our mortgage ahead of time. Having said that, there's no way on Earth I can take on an additional $70,000 over the next three years, particularly when the years beyond that will be equally bad. If I can't do it, how can anyone expect the average family, making about $40-50K to do it? We're getting buried, all of us.
Is it deliberate? Victor Davis Hanson thinks so.
I think the key was not so much the spending excess or new entitlements. The point instead was the consequence of the resulting deficits, which will require radically new taxation for generations. If on April 15 the federal and state governments, local entities, the Social Security system, and the new health-care programs can claim 70 percent of the income of the top 5 percent of taxpayers, then that is considered a public good — every bit as valuable as funding new programs, and one worth risking insolvency.In essence, Obama is deliberately setting up a crisis where the only possible solution will be to tax successful people into submission. In previous posts, I've argued that Obama's goals are not to increase jobs or improve the economy, but to save the planet and redistribute wealth. In my mind, there's no way adding $70,000 of debt to every American family is anything but a deliberate effort to kill capitalism and hence, the American economy.
Individual compensation is now seen as arbitrary and, by extension, inherently unfair. A high income is now rationalized as having less to do with market-driven needs, acquired skills, a higher level of education, innate intelligence, inheritance, hard work, or accepting risk.
In the end, we will all be equal. Equally poor.
I am remarkably sanguine (given the circumstances) regarding higher taxes. I have no doubt the democrats would like to accomplish this, but the demographic shift on the left makes it increasingly hard for them to do it. No longer are the Democrats the wretched of the earth, at the bottom of socio-economic heap. Urban professionals and academics make up a big chunk of their ranks, and the further to the left, the more professional and academic they become. Add to this the reluctance of independents to go for higher taxes, and you have a tax ceiling.
ReplyDeleteJeff, it's not a matter of this voting bloc or that, it's mathematics. How are you, Jeff Burton, going to pay off your debt, particularly when it just keeps piling up?
ReplyDeleteHow will your parents pay theirs off? How about your cousins? Your neighbors? We're marinating in debt, all of us, rich and poor alike.
What cannot be repaid won't be repaid - that's the math I'm looking at. It will be defaulted, either directly or indirectly. Now, you could argue that I am going to pay via the consequences of default. I completely agree with that.
ReplyDeleteBelieve me, I'm as angry and frustrated as you. I am just trying to be realistic. Rhetoric like "how are we going to pay" is not realistic to me because we aren't going to pay (directly at least).
Jeff, a topic for a future post is this: be careful what you wish for, Mr. President.
ReplyDeleteIt's clear that the liberals have been shocked by the public's anger over ObamaCare. I don't think anyone can predict the outcome of debauching the currency. Obama may think he'll get his socialist utopia, but he might end up getting something quite different.
Yes. The bottom line is that we have reached the limit of how much plundering the statists can do without seriously damaging the economic machine. What happens next will be very interesting to observe and very painful to live through.
ReplyDeleteThe debt will not be repaid, nor will it be defaulted.
ReplyDeleteIt will be inflated away. A couple of years of double or triple digit inflation and that debt won't be so bad.
For those of you unfamiliar with the consequences, please go look up "The Weimar Republic"
Inflation is an implicit or "soft" default.
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