Filed under: Capitalism, Freedom, The United States | Tags: Economy, Liberty, The Revolution, Trial and Error
The Extraordinary Life and Times of
Our National Debt
by John Steele Gordon
But there can hardly be a poorer credit risk than a newly formed government in rebellion against a Great Power. Such governments vanish with defeat, the leaders are hanged, and their debts become uncollectible. More, the American colonies had had only rudimentary tax systems, and the new Continental Congress, established in 1775, had none at all. The Congress was able to borrow something over $11 million from the French government and Dutch bankers — both countries soon went to war with Britain hoping to take advantage of this situation — mostly for purchases in those countries. And Congress and the states sold bonds to wealthy patriots who were willing to risk the loss of their capital for the cause. But the money raised was not nearly enough. Thus the nascent United States had no choice but to resort to every financial expediency at its disposal in order to feed, equip, and pay the state militias and the Continental army.
The main source of revenue was in fact, the printing press. Congress issued massive amounts of so-called continentals, paper money that was backed by nothing more than a declaration that it was legal tender. By the end of the war these issues amounted to more than $200 million at face value. But this fiat money had quickly depreciated, as fiat money always does. Before the war ended, Congress had been forced to revalue earlier issues at only 2.5 percent of face value, and the phrase “not worth a continental” would be part of the American idiom for a century. Further, the state governments and Continental Congress used what were, in effect, forced loans, requisitioning food and supplies from citizens and paying for the goods with IOUs. These also quickly depreciated as they passed from hand to hand.
Filed under: Democrat Corruption, Domestic Policy, Economy, Freedom, Politics | Tags: Economy, Growth, Poverty, Progress
This Robert Heinlein quote may be familiar, or not, but it is certainly worth repeating:
Throughout history, poverty is the normal condition of man. Advances which permit this norm to be exceeded — here and there, now and then — are the work of an extremely small minority, frequently despised, often condemned, and almost always opposed by all right-thinking people. Whenever this tiny minority is kept from creating, or (as sometimes happens) is driven out of a society, the people then slip back into abject poverty.
This is known as “bad luck.”.
Filed under: Capitalism, Economy, Politics | Tags: Economy, Growing Debt, Unemployment
Filed under: Conservatism, Election 2010, Liberalism, Politics | Tags: Debunking Liberal Lies, Economy, Spending, Unemployment
(h/t: National Review)
Filed under: Capitalism, Education, Taxes | Tags: Campaign Promises, Democrat Corruption, Economy, Performance
If you live in a low performance state, you probably know it. Unemployment is high, so the legislature is raising taxes. Companies are moving out-of-state to locations friendlier to business. Wealthy households are moving out, and fewer wealthy households are moving in.
In Virginia, Republican Bob McDonnell won a high-profile gubernatorial race. He has unveiled an ambitious proposal to expand the number of charter schools. He also wants to create virtual schools in which students can learn outside of traditional classrooms, as well as laboratory schools that would benefit from partnerships with Virginia colleges and universities. All three proposals must be approved by the General Assembly in a session that ends next month.
He is sticking to his no-tax pledge, and he is pushing ahead with an effort to sell off state-owned liquor stores. States which have privatized their liquor sales have gained million of dollars in new tax and license revenues, and cut millions of dollars in government expenditures. In other words, he’s doing what he said he would.
In New Jersey, newly elected Republican Governor Chris Christie is also doing just what he promised. He has appointed a school-choice advocate to the howls of the teacher’s union. And he has announced a real spending freeze on $1.6 billion of unspent money. He was blunt. “Today we come to terms with the fact that we cannot spend money on everything we want. Today, the days of Alice in Wonderland budgeting in Trenton end.”
A new study by Boston College’s Center on Wealth and Philanthropy looked at the decade from 1999 to 2008. It found that in the decade’s first half, New Jersey was booming with a $98 billion net influx of capital due to wealthy households moving into the state.
Then the trend reversed. From 2004 to 2008 there was “a large decline in the number of wealthy households entering New Jersey” as well as “a moderate increase in the outflow of wealthy households leaving.” How come? The study doesn’t say, but the top income tax rate went from 6.37% on incomes over $500,000 to 8.97% — a 40% increase.
Basic economics: when you tax something you get less of it — in this case wealthy households that help to create jobs and increase charitable capacity. The out-migration went to New York and Pennsylvania which have lower top tax rates. The third most popular destination was Florida which has no income tax and no estate tax.
Filed under: Capitalism, Economy, Freedom, Taxes | Tags: Debunking Liberal Lies, Economy, The Federal Reserve, The Finincial Crisis
I am an enormous fan of the Hoover Institution’s Uncommon Knowledge programs. This last week, Peter Robinson interviewed Richard A. Epstein and John Taylor. Peter Robinson’s question: Are we all Keynesians Now? After introducing the opposing approaches to economics of John Maynard Keynes and Milton Friedman, economists Richard Epstein and John Taylor discuss U.S. monetary policy from the 1970s onward.
Richard A. Epstein, on the left above, is a founder of the field of law and economics. He is director of the John M. Olin Program in Law and Economics at the University of Chicago and a fellow at the Hoover Institution. John Taylor is a former undersecretary of the Treasury for international affairs. He is a fellow at the Hoover Institution and a professor of economics at Stanford University.
The controversy in the world of economics and finance today is between the Keynesian economics that the Obama administration follows and the free market ideas of Milton Friedman that the Republicans believe are proven to be more effective.
This interview is like sitting in on a conversation with three brilliant friends. Each segment in about 6 minutes long, so you can watch at your pleasure. What’s neat is that you can go back and review any part that you didn’t understand. Unlike those college seminars, if you didn’t take good notes, all you have to do is play them over again.
The previous interviews are all available at the same link above. They range from Thomas Sowell, to Dambisa Moyo, Charles Kesler, Antonin Scalia and John Bolton to mention only a few of the many guests. I recommend them highly.
Filed under: Economy, Freedom, Health Care, Politics | Tags: Democrat Corruption, Economy, Liberal lies, Taxes
Health-care reform. Someone on the left actually said that Democrats have to pass something so that Obama has an accomplishment for the State of the Union speech. Is that really what this is all about?
Voters oppose the bill by 52% to 38%, and President Obama’s handling gets even more of a thumbs down, with 56% disapproving. By 71% to 21%, voters don’t think universal coverage is worth lower quality of care. 66% believe that free market competition would do a better job of reducing costs.
The bill being debated by the Senate is a monstrous mess. It will raise the cost of medical care for everyone. It will reduce the quality of care. You will lose your private health care coverage. And it will leave 24 million people still uninsured.
A family earning $54,000 a year, buying a nationwide Blue Cross/ Blue Shield policy through FEHBP (Federal Employees Health Benefit Program) would pay monthly premiums over $825 after a $10,100 government subsidy.
Everything promised: insure the uninsured, reduce the deficit, improve the quality of care, ” if you like your plan you can keep it”, reduce the amount you pay for your health care, reduce the rapid increase in costs and “you can keep the coverage from your employer”. All a lie.
They will eliminate the government option, and allow people to “buy into”Medicare early at 55 or 60. [Another way to get you under government control] An individual, age 55 could buy into Medicare for only $7,600 or $15,200 for a couple.
Robert Tracinski describes the three disastrous provisions in the Reid/Baucus/Obama health-care bill:
Guaranteed Issue — requires insurance companies to offer coverage to people who are already sick, and limits companies’ ability to charge higher rates for customers who pose a higher risk. This means that everyone’s premiums will rise sharply. Young healthy people would quickly realize that there was no point in buying insurance and paying high premiums until they got sick.
Individual Mandate — The fix for guaranteed issue is to require everyone to buy insurance or pay a tax set at $750. This is a tax for existing. Cheaper to pay the tax, and continue to refuse to buy insurance than to buy it. So prison is an option.
All New Policies Are Part of a Government Controlled “Exchange” — This is designed to eliminate low-cost plans like owning a catastrophic care policy along with a Health Savings Account. Under the guise of making insurance more affordable, insurance will be restricted to the most expensive options.
As Tracinski says:
That is the final and perhaps most compelling reason to kill this bill: the sheer arrogance of the whole enterprise. It is the arrogance of stampeding an unwilling public toward a monstrous 2,000-page piece of legislation while admitting that it still has huge problems, but promising that it will all somehow be fixed later on. It’s the arrogance of selling us a bill that expands government spending by hundreds of billions of dollars while telling us that it will reduce the deficit. It is the sheer unmitigated gall of appointing a bureaucrat to run a government-controlled insurance market that takes away all of our health choices-and then calling this bureaucrat the Health Choices Commissioner.
The Democrat leadership is determined to pass something, which they will “fix” later. They will use every trick in the book to make it happen.
You need to let them hear from you. The National Center for Policy Analysis and the Salem Radio Network have made an opportunity for you to call your senators and representatives toll-free.
Please take advantage of it!