Category Archives: Money

Capitalism Survives, In Spite of Obama, Pelosi, et al

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As we embark on a new year, positive economic indications are abundant. Having experienced the worst recession in modern financial history six years ago, the U.S. has slowly but surely emerged on more sure footing heading into the New Year. What has precipitated economically over the past six years cannot causally be attributed to any policies or governmental programs. Recovery has occurred in spite of government efforts, and is a testament to the free market capitalistic system our economy is based upon.

BG-not-looking-for-work-2014-chart-2-825In December the Dow Jones Industrial Average broke through the 18,000 level for the first time ever, capping a 7.5% gain for 2014. Due to lower gas prices, we saved approximately $14 billion in energy costs for the year. And our moribund Gross Domestic Product (GDP) finally started to show signs of life with a 5% annualized growth rate in the third quarter. These data have significantly improved consumer sentiment, which is a measure of economic optimism. The latest reading of 92.6 represents a marked upward move from a third quarter reading of 82.

Due primarily to these factors, there’s even been improvement in the job market. Nonfarm payrolls have risen 26 consecutive months through December, averaging about 210,000 per month, according to the Bureau of Labor Statistics (BLS). Job growth is critical to economic growth since 70% of our economy is consumer driven, and more people with jobs, and especially good-paying jobs, augments growth sustainability.

ft110705-fig10The employment data still do not indicate a full recovery, however. According to the BLS Table A-15, 11% is closer to the real unemployment rate than the present headline figure of 5.8%. Item U6 indicates that the “Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force,” is nearly double the headline figure. There are too many still underemployed or only working part-time, who are looking for better jobs.

The Participation Rate is too low at 62.8%, which is near all-time lows for employable adults holding jobs. Pre-recession Participation Rate was over 66%. Currently, there are 6.9 million fewer Americans in the work force, either working or looking for employment, than there were six years ago. Those who have given up on finding a job are no longer counted in the headline household unemployment rate. Consequently, with 6.9 million fewer Americans working or searching for work, a significant percentage of the drop in unemployment since 2009 is largely due to those who have given up on finding a job. According to the BLS, demographic factors explain less than one-quarter of the decreased labor force participation.

When we look for causal factors for this recovery, however tepid, we cannot find any from the government. Nothing done by the Executive or Legislative branches of government have contributed to the recovery. With but a couple of exceptions, everything government has done in the past six years has thwarted economic growth and recovery.

b2482_chart1_600pxThe three major governmental accomplishments over the past six years have restricted and constrained our economic engine. The “Stimulus” of 2008 did not stimulate. According to the Wall Street Journal, over half of the $850 billion ($1.1 trillion, including interest) “stimulus” bill could be more correctly classified as discretionary spending. The Congressional Budget Office “scoring” of the stimulus package indicated that only 12 cents of every dollar would have a stimulative affect on the economy. The scoring process clearly indicated the impotence of the “Stimulus” for creating positive, let alone sustainable, economic growth.

The Affordable Care Act (ACA) doesn’t stimulate the economy, for it is laden with new taxes and fees imposed on individuals and employers to be implemented over the next few years. And actually when the full impact of those new taxes hit, the adverse effect on the economy will be considerable. For as Christina Romer, former chair of Obama’s Council of Economic Advisors, revealed last year, “Tax changes have very large effects: an exogenous tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent.”

Likewise, the FinReg, Dodd-Frank financial regulatory reform is a deterrent to growth. It solidifies the crony capitalistic relationship between Wall Street, the major banks, and Washington by assuring further government intervention with institutions deemed “too big to fail.” The costs of implementation at the private sector level have resulted in higher fees, charges, and interest rates for financial institutions to recoup the implementation costs. Anything that takes from producers and savers to pay for regulatory overreach is antithetical to economic stimulus.

econsnap-1Those three governmental “successes” were all passed before 2010 when leadership of the House changed hands. This was perhaps the most effectual event leading to economic recovery. After 2010, with a divided congress, less has been done governmentally to interfere with the economy. Consequently, business owners, CEO’s, and employees have adapted to the new “normal” of higher costs of regulation and are gradually digging themselves out of the morass. The greatest benefit of a divided congress is less governmental intervention.

This should be perhaps the greatest measure of a successful government or regime. Rather than measure productivity based on how much legislation is passed, measure it based on how little they encroach on our liberty and our capitalistic economy.

The great economist and Nobel Laureate Milton Friedman, once said, “Government has three primary functions. It should provide for military defense of the nation. It should enforce contracts between individuals. It should protect citizens from crimes against themselves or their property. When government– in pursuit of good intentions tries to rearrange the economy, legislate morality, or help special interests, the costs come in inefficiency, lack of motivation, and loss of freedom. Government should be a referee, not an active player.”

The objectivist philosopher, Ayn Rand, echoes this sentiment. She wrote, “America’s abundance was created not by public sacrifices to the common good, but by the productive genius of free men who pursued their own personal interests and the making of their own private fortunes. They did not starve the people to pay for America’s industrialization. They gave the people better jobs, higher wages, and cheaper goods with every new machine they invented, with every scientific discovery or technological advance — and thus the whole country was moving forward and profiting, not suffering, every step of the way.”

It appears at least ostensibly that the intent of the 114th Congress will be to roll back some of the onerous regulatory burdens conceived by their predecessors. If they are successful in doing so, the growth potential of our economic engine could be unleashed for significant expansion. After all, look at how far we’ve come in spite of their predecessor’s efforts to stifle free enterprise in our capitalistic system.

Associated Press award winning columnist Richard Larsen is President of Larsen Financial, a brokerage and financial planning firm in Pocatello, Idaho and is a graduate of Idaho State University with degrees in Political Science and History and coursework completed toward a Master’s in Public Administration. He can be reached at [email protected].

Dollar Strength Set to Continue

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alg-american-flag-money-jpgThe U.S. Dollar has been on a huge upside run for months, and depending on Friday’s jobs numbers, may continue to dominate the currency market.

Chinese PPI (Producer Price Index) grew at only 3.3% indicating a cooling in the Asian economy.

Chinese property developer Kaisa Group Holdings has defaulted on $52 Million dollars in U.S. Dollar denominated debt and indicated that they may not be able to pay on additional debt.

A singular default would not normally be newsworthy – except that NO Chinese company has EVER defaulted on a U.S.D. denominated loan.

Friday morning we see if the U.S. economy is continuing to create jobs or takes a step back.

If the jobs number comes in above 250,000, the dollar surge will continue as more investors flee Asian, European and new economy currencies for the security of the U.S. Dollar.

If the BLS numbers come in less than a quarter million, expect the dollar surge to slow as investors will cease to see the United States as a safe haven in a global slowdown.

 

Russian Currency Collapses Overnight

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Russian ruble valueThe Russian Ruble has taken a turn for the worst as an overnight move by the Russian central bank increased mistrust of the entity and the buying power of the Russian currency. America may feel the pinch before long.

At 1:00am in Moscow, the Russian Central Bank increased interest rates from 10.5% to 17% – a 650 basis point move in moments. That move sent the Ruble into free-fall.

Upon the banking move, the currency went from about $58 dollars per ruble to a low of $79.66 per Ruble.

The Ruble has been steadily declining in value since late summer due to the crude oil glut and ensuing price decreases engineered by OPEC.

Russia is not a heavy manufacturing or intellectual property production nation. It’s gross domestic product comes almost entirely from commodities – oil and precious metals making up a huge part.


As oil declines, so does the ability of the Russian economy to grow. For each $10 drop in the price of crude, Russia loses approximately .8% of GDP. The price of oil has dropped from a high of about $110 to a current value of about $56 which could equate to an almost 5% loss of GDP.

Adding to headwinds, Vladimir Putin’s incursions into Ukraine have brought on international sanctions that make it nearly impossible for Russian businesses to roll-over their Euro and Dollar-denominated debt which could cause a huge number of defaults over the next 12-18 months.

The effects on the American economy may be soon to follow.

Russian oil drillers earn dollars for the oil exports, but spend locally in the Russian currency. That hedges their production budgets against falling crude prices. Unlike America, where producers earn and pay in the same currency.

Because of the currency move, it could be advantageous for Russia to increase production to enhance revenues and tax receipts. This would increase the supply of cheap oil and push crude prices below $45. American shale oil producers will feel the brunt of cheap oil.

Obama Legacy: No one wants to work

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Almost everyone agrees that the policies of the current administration are not conducive to job creation. What’s really eye-opening is that the current policies are causing a huge portion of Americans to find work undesirable.

So why are more Americans not seeking work? The Pew Research Center has the answer:

You might think legions of retiring Baby Boomers are to blame, or perhaps the swelling ranks of laid-off workers who’ve grown discouraged about their re-employment prospects. While both of those groups doubtless are important (though just how important is debated by labor economists), our analysis of Bureau of Labor Statistics data suggests another key factor: Teens and young adults aren’t as interested in entering the work force as they used to be, a trend that predates the Great Recession.

The youngest of the nations’ working aged people are increasingly disinterested in finding work. Many in small business have also noticed an increasing number of new hires that just don’t have any drive once they have the job.

Some Americans remember asking for permission to work before they hit the age of 16. Most had jobs for extra money during high school. Very few from the previous generations would consider finding work “undesirable.”

What has led the nation’s new youth to find work offensive when their elders found being out-of-work to be embarrassing?

The culture of government dependency is likely the answer. Why work when the government will provide healthcare, a paycheck, food and a place to live? Strange that those same promises made in nations like Russia, Cuba and Venezuela instead lead to a nation of poor people with no way out.

As is proven by the numbers, America is not different. This nation requires a motivated workforce to invent, produce and consume. Anyone of working age not doing at least two of the three is taking more wood off the proverbial American wood pile than they are putting on. They are takers and an embarrassment to the country.

EBT cards have made the “green stamps” of yesteryear obsolete. They have also removed the stigma of using a page of stamps to pay for basic groceries. They also allow holders to buy fast food, junk snacks and sodas – not the basic needs for survival.

Being unproductive is no longer embarrassing. Adults living with their parents is common. Government benefits and pay are better than what many small businesses can offer. Is it really any surprise that a ton of Americans would really rather not work.

Government subsistence is no longer temporary or undesirable – working is.

Obamacare forces many to avoid preventative healthcare

President Obama promised huge reductions in premiums and greater access to care. Unfortunately, forcing insurers to create plans with easy payments, unaffordable deductibles terrible networks has had dire consequences.

Fox News reports that the White House pushed for low premiums regardless of the fact that they come with high deductibles, reduced benefits and very few doctors in-network because “most people buy only based on premiums.” That pushes Obamacare recipients into community health organizations and often making choices with expensive or dangerous consequences.

When those on the high-deductible “affordable” plans are told that additional treatment, tests or drugs may be needed to identify or prevent their condition from worsening, they often balk at the preventative measures because those costs would not be paid until they hit the huge deductible that their small premium dictates. Now, the politics of Obamacare have created a medical train-wreck out of someone who previously would have just needed preventative medical attention.

To avoid becoming a medical nightmare, many of these Obamacare enrollees are using community health centers, which offer low cost or free care, to deal with their health issues. So, what did these enrollees get for taking the President’s advice and getting enrolled? They get to go outside the standard healthcare system while still paying into it.

Intelligent Americans Reject Democrat “War on Women” and decide to vote smart

Political polling shows that the American voting public grows increasingly weary of Democrats saying that Republicans oppose mammograms and PAP smears.

Liberal groups funded by commercial abortion operations like Planned Parenthood have been producing dramatic advertisements showing women complaining about Republican candidates who are voting against mammograms and PAP smears – key tools in the detection of women’s health issues. Unfortunately for Democrats, women are smart enough to realize that politicians aren’t banning their health screening or even reducing government funding for mammograms. They’ve just decided that taxpayer money can’t be used to kill babies. If women want to kill their unborn babies, they’ll just have to pay for it themselves. Just wait until those women see what Obamacare has done to their healthcare costs…

Voters are looking at their grocery bills, utility bills and Obamacare bills. Oddly, despite the Democrats assurances, all of those bills have gone up while their pay has not – and one party has ruled the majority of our government for 6+ years.

Why did their salaries stagnate? Probably due to increased competition from a more fluid immigration policy. As more (foreign)  people compete for the same jobs, their is nothing left to cause increased pay pressure.

Democrat policies are the sole cause of stagnant pay, increasing healthcare costs and less-available jobs. Now, they pay the price the rest of us have been bearing under their failed leadership – they may just be out of a job.

Are You a Purple Penguin?

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This story goes in my “Administrators gone wild” file. It seems a Nebraska school district is instructing its teachers not to use the terms “boys and girls,” “ladies and gentlemen,” “you guys,” well, you get the idea. Why? Because they don’t include gender non-confirming terminology and therefore causes confusion for those few children who don’t identify with any specific gender. Simply put, it’s just not inclusive of all.

To make sure that we include everyone and no one feels slighted they have decided the proper inclusive terminology for young kids is to call them “purple penguins.” Because that isn’t confusing at all?

Now we have to change everything because a few kids in the class are being told by their parents that they don’t have to “choose” a gender (like you choose a pair of shoes?) until they’re comfortable doing so. Instead of teaching a child what gender they were born into, they make sure the child lives in a sort of “Gender Twilight Zone” until they can decide what direction to go in. Don’t believe me? Look up the movement to stop hospitals and doctors from “pronouncing gender” on a baby when “it” is born. Yes, the crazy train is close at hand.

This is probably that same group of “$%#*%^” people that said “we can’t keep score at Little League games because it makes the losers feel bad. We shouldn’t give letter grades because it makes the kids feel bad. Don’t mark a paper in red pen, it makes the kids feel bad. Really? Stop all the nonsense and just say, “Let’s not challenge our children because if everything goes the way of the Progressive Left they won’t have to excel at anything, the government will take care of them.” The only definite in these people’s lives is that sane rational thought needs to go.

Administrators feel that by calling them purple penguins it allows the children to be free thinkers. They go on to say, that we should stop asking the kids to line up as boys and girls, and instead, ask them to line up by who likes, skateboards or bikes, dogs or cats, summer or winter. Before guiding the kids, consider the question, “will this create a gender spectrum?”

People, the inmates are running the asylum. Though I have great respect for the “shrinks” of the world, they are not all on the same page on this issue. For them, it’s not an exact science. Some doctors tell you kids need definites in their lives, solid boundaries. They need to know who and what they are. Some say noooooo they need to be able to explore their inner self and look at the world in different ways. Ok, sure, now which one is right?

So they chose penguins as an inclusive, gender non-specific option. Penguins are a gender-specific, traditional family-oriented species. According to LiveScience.com, most penguins are monogamous, at a minimum, for the duration of the mating season, and in many cases, for most of their lives (married forever). Researchers have found that penguins re-paired with the same partner 82 percent of the time and certain species of penguins re-paired 90 percent of the time. Better than the human divorce rates.

Each gender has their designated roles, according to LiveScience.com. The male (gender specific) usually starts the mating ritual and will pick out a nice nesting site before he approaches a female. (Wow! All those choices without including her?) After mating, the female emperor penguin will lay a single egg. The female (gender specific) of this species will place the egg on the male’s feet to keep warm in his fat folds while she goes out and hunts for several weeks.

So with all this exclusive, gender-specific, family-valued system, how did the loons on the Left choose purple penguins to be the “inclusive, non-gender-specific” alternative to “boys and girls?” Coin toss? Everyone loves penguins?
Read more at The Real Side

Unemployment at All-Time Low 5.9%… Just Kidding!

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Government math takes on many forms. I think it’s the basis for Common Core math. In Common Core, 2 plus 2 plus 2 doesn’t always equal 6. Just like 18% of employable people in the U.S. equals a 5.9% unemployment rate.

The 5.9 %number is usually arrived at by simply looking at how many Americans file for unemployment every week, both new and continuing claims. You hear about the numbers of people dropping off the rolls but you never hear why. The assumption is that they found a job.

Do you ever hear them report about the number of people who drop off the unemployment rolls because they ran out of time? Or the ones who got discouraged and gave up looking because they couldn’t find employment. What about the ones who switch to disability because they are now having physical and mental issues as a result of their job search? (Insert crickets sound here.)

Most economists use another set of numbers that the government Bureau of Labor Statistics calls “U-6.” It defines the “total unemployed, plus all marginally attached workers plus total employed part time for economic reasons, as a percent of all civilian labor force plus all marginally attached workers.”

This number takes into account, by that definition, the underemployed, discouraged, and unemployed workers. This number actually did fall for the first time below 12% to 11.8%. Hey, don’t get too excited yet.

Remember, just before the election period in 2012, we were told unemployment was down. Many government math “adjustments” were made to the unemployment numbers all summer leading up to the November 2012 election. But fudging the numbers shouldn’t be a big surprise. I mean, look at the other “adjustments” that were made : Benghazi was “not” another 9/11 anniversary attack, the Obamacare rollout debacle was really just a few “minor” glitches, much like that whole “keeping your doctor” thing.

Now, back to government math. In September, the unemployment rate dropped by 0.2% to 5.9%. The number of people unemployed dropped by about 329,000 to 9.3 million.
Read more at THE REAL SIDE

Article V Convention – Congress Will Not Act, So We Will

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Government debt continues to amass at a dizzying pace. The federal government has displayed no discipline in reining it in and reestablishing a more sound fiscal footing for the future of the country. Our founding fathers, however, had the prescience to include in our Constitution the means whereby the states, and the people, could force the government to do what they have no appetite to do, to require a balanced budget.

Growth-Of-United-States-Government-DebtJust since 2006, federal government debt has shot from $6.7 trillion, to nearly $18 trillion. The largest segment of that spending occurred over the past six years with five years of deficits exceeding $1 trillion. Our government has been spending 60% more than it’s been collecting in tax receipts.

Those figures do not even begin to address our long-term debt due to non-discretionary entitlement programs. According to the General Accounting Office’s (GAO) 2013 annual report, unfunded debt including Social Security and Medicare is over $76 trillion, an increase of 8% over 2012 levels. Our national debt increases by an estimated $8.2 million per minute, and about $350 billion per month.

The GAO was explicit in its warning to the policy makers about our spending. They said in the very first paragraph, “GAO’s simulations continue to show escalating levels of debt that illustrate that the long-term fiscal outlook remains unsustainable.”

Budget-chartFormer Comptroller General of the United States, David M. Walker, has been sounding the clarion call of economic disaster for the nation if spending is not reined in, and politicians refuse to deal with fiscal realities of unabated spending. He describes America as a “sinking ship” in a sea of our own debt. He points out that, “The US ranks near the bottom of developed global economies in terms of financial stability and will stay there unless it addresses its burgeoning debt problems,” based on the Sovereign Fiscal Responsibility Index.

Something must be done before the dollar and our entire economic system collapses entirely due to our calamitous accumulation of debt. And the solution could be nestled in Article V of the Constitution. That Article declares how the document can be amended.

Debt-Ceiling-Cartoon“The Congress, whenever two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, or, on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress.”

That second option, referred to as an Article V Convention, or Convention of the States, has never been utilized. It’s been attempted before, but never to fruition. It was added to the document after four earlier attempts at language that would have opened the door to a full constitutional convention. The precise and narrow limitations of an Article V convention only allows for adoption of amendments, not a complete “con con” which could facilitate mischief in rewriting our founding document. In Federalist Paper 43 James Madison explained, “It guards equally against that extreme facility, which would render the Constitution too mutable.”

cg536b7ae12610aThis is validated by Nick Dranias, Director of the Goldwater Institute’s Center for Constitutional Government, who has said, “Despite claims made to the contrary, the truth is that Article V does not provide authority for a foundational constitutional convention. The Founders specifically and repeatedly rejected efforts to substitute the current Article V language to allow for a foundational constitutional convention to be called.”

Currently there are active efforts to call an Article V Convention for at least two major issues: a Balanced Budget Amendment, and a National Debt Relief Amendment. Both are oriented toward forcing the federal government to get its fiscal house in order. The latter would disallow congress from increasing the federal debt without a majority of states approving an increase in the debt limit.

In order for such a convention to be convened, two-thirds of the states must pass resolutions calling for it, and then upon adoption of the specific amendments at the convention, three-fourths of the states must ratify. Therein lies the assurance that only viable and constitutionally sound amendments would emerge from such a convention.

Every citizen, and every state in the union has a stake in the solvency and fiscal stability of the nation, and should be actively embracing and supporting the Article V Convention process for these key issues. Hopefully an amendment will then be advanced for establishing term limits on congress, as well. Since Washington will not lead on these critical issues, it’s time for the people, and the states, to do so.

Associated Press award winning columnist Richard Larsen is President of Larsen Financial, a brokerage and financial planning firm in Pocatello, Idaho and is a graduate of Idaho State University with degrees in Political Science and History and coursework completed toward a Master’s in Public Administration. He can be reached at [email protected].

Paying Taxes Is Not “Patriotic,” Nor is it “Voluntary”

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Six years ago Vice President Joe Biden said that paying taxes is patriotic. Citing the need for the wealthy to pay more of their “share” of taxes, he said it was, “time to be patriotic,” even though the top 20% of wage-earners pay 93% of federal income taxes. The latest iteration of the “paying taxes is patriotic” meme came last month when Treasury Secretary Jack Lew sent a letter to Senate Finance Committee Chairman Ron Wyden calling for a “new sense of economic patriotism.” The payment of taxes by a citizenry in a free society is not inherently patriotic, but such statements are not unexpected from those who conflate emotion with logic.

jack-lew-611x442The context of Secretary Lew’s letter is important, however. Dozens of American companies have made acquisitions or merged with other companies based in the United Kingdom, or more advantageously, Ireland, in order to circumvent the U.S. confiscatory 35% corporate tax rate, which is currently the highest in the world. By basing operations in Ireland, these newly migrated companies pay a relatively paltry flat 12.5% tax on profits. Nine of the top ten global pharmaceutical companies now have operations in Ireland, and some of the largest technology companies, including Google, Twitter, and Facebook, do as well.

The process is called inversion, and here’s how it works economically. A company acquires or merges with a company in Ireland (or Britain, Switzerland, or the Netherlands) and re-domiciles there for the cash savings from U.S. tax rates. The company then lends cash back to the U.S. creating tax-deductible interest payments to benefit American operations. And in the more elaborate variation, interest costs and royalty payments made to Dutch subsidiaries reduce the tax bill in Ireland to 6%. Royalties and interest payments are then funneled to Bermuda, which then cuts the tax in Ireland to zero since Ireland views it as a “Bermuda resident.” This creates a veritable “cash mountain,” as the UK’s Financial Times refers to it, allowing the newly reorganized Irish company to pay nothing in taxes. The Financial Times estimates the “cash mountain” built up through such inversions to be as high as $1 trillion.

The absurdity of our 35% nominal corporate tax rate is magnified when we realize that the $1 trillion sitting overseas is worth a paltry $16 billion in tax revenue to the treasury, as Secretary Lew said on CNBC last month. In other words, to save $16 billion in federal corporate taxes, formerly U.S. based companies have relocated $1 trillion in cash, and all of the economic activity, including jobs and manufacturing, that a trillion dollars of cash (M1) velocity can generate. Our inordinately high tax rates have exceeded the point of diminishing return.

corporate-tax-rate-600The reason the tax revenue can be so low as Lew’s estimate is because the average corporate effective rate is about 12% after deductions. Our tax code has become so porous through crony-capitalism that a company the size of General Electric with sales of over $120 billion, and net profit of $14 billion, could file a 57,000-page tax return for 2010 and pay no corporate income taxes. Our sieve-like tax code hemorrhages tax receipts to the U.S. Treasury.

It’s nothing short of duplicity for the administration to call for “patriotism” from entities they have been arguing are not people, and should not be afforded freedom of speech or freedom of religion rights. They have bemoaned the Citizen’s United case in which the Supreme Court ruled corporations have free speech rights, and the Hobby Lobby ruling affirming corporate freedom of religion, yet they claim such companies can have patriotism, which is an emotion and a trait that can’t be felt or manifest by inanimate objects or organizations. For logical consistency, they can’t have it both ways.

Even though Senate Majority Leader Harry Reid claimed a few years ago that paying taxes is “voluntary,” our taxes are collected from us based on principles of coercion. We pay our taxes under legal threat of fines and penalties, which could include jail time. Companies withhold a percentage of our income as a payroll deduction under threat of fines and penalties. This is also why paying taxes to “share the wealth” is not an act of magnanimity either, for coercion can never be mistaken for giving freely of our substance.

BstMy4OIEAAiQ_m.png-largeThe claim that paying taxes is patriotic is prima facie specious, even if some of the benefits from paying taxes are beneficial to us personally, for tax collection is facilitated by the threat of penalty, which is coercive. As such, it much more closely resembles extortion than patriotism. In a legal context, extortion refers to how the funds are expropriated, not in how they are appropriated. Extortion is forced, while patriotism is clearly voluntary. And since patriotism is attitudinal, there’s absolutely nothing wrong with harboring such sentiments whilst paying.

Taxes are an essential component to facilitate the operations of prudent and constitutional governance. As Oliver Wendell Holmes said, “Taxes are what we pay for civilized society.” However, when tax code incentivizes the relocation of America’s engines of economic growth, its effect is deleterious to the nation. And taxation for reallocation is clearly immoral for our founders formed our system of governance to preclude the possibility of our government doing what would be illegal for an individual citizen to do.

Senate Finance Committee Chairman Senator Ron Wyden is correct to not take the band aid approach to closing the inversion loophole. His preference is to overhaul the corporate tax structure which currently incentivizes U.S. corporations to relocate headquarters and manufacturing elsewhere in the global marketplace.

The most efficacious means of repatriating that $1 trillion sitting in overseas banks would be to shred the entire corporate tax code and go to a flat corporate tax rate. That additional trillion dollars in monetary velocity could make a significant contribution to GDP expansion, as well as augmenting U.S. tax receipts.

Associated Press award winning columnist Richard Larsen is President of Larsen Financial, a brokerage and financial planning firm in Pocatello, Idaho and is a graduate of Idaho State University with degrees in Political Science and History and coursework completed toward a Master’s in Public Administration. He can be reached at [email protected].

 

I Told You It Wasn’t a Woman’s Health Issue !

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I have been saying, to the irritant of my friends on the Left, that abortion has nothing to do with women’s health.

One of the original questions the Supreme Court had to deal with in the seventies when they approved this “slaughter law” was, when does life begin. Well, all the academics and doctors that were willing to take some money and testify said life did not start until the third trimester.

Remember, this was a time when cancer was almost always fatal. AIDS was a death sentence, and, in some cases, people still died from the flu.

Medicine has come a long way since then. And now, many agree, scientists and doctors alike, that life begins at conception or shortly thereafter.

Dr. Bill Fifer, a professor of psychiatry at Columbia University, said, “Everything that a newborn baby does, a fetus has pretty much done already.” He went on to say “We know that a baby’s tiny heart is beating as early as 18 days after sperm-egg fusion. Brain waves are detectable by 6 weeks and babies can experience dream (REM) sleep by 17 weeks. Substantial medical and scientific evidence has demonstrated that unborn children are capable of feeling pain by 20 weeks, if not earlier.”

Not Joe Messina’s opinion, but science. This is now the understanding of many in the medical field. However, I am still perplexed. You see, the Left continually beats on Right-wing, conservative, Bible-thumping Republicans (like myself) for not believing in science but rather the fairy tales of the Bible.

But when confronted by science and facts (not theories like, let’s say, evolution) that don’t line up with their way of thinking they ignore them and tell us that we hate women (in the case of our abortion stance.) Why? Because is easier than discussing the facts.

So, if at 18 days that little blob of cells has a heartbeat, what can we call it? What will it eventually be? A canine? A fish? A tree? Nope. Simply, a human. Its only potential outcome is that it is a developing human!

Now with science we can see with sonograms and 3-D imagery what the baby looks like. We can’t run from that truth. Our youth are seeing it more and more and are changing the way they view abortion.

So then… it is a life! But what about the argument for years from the Left and the pro-abortion groups that it’s not a life? As of late, some of the abortion proponents are saying that life begins when the mother says it does, that the unborn blob of cells can be snuffed out even up to the time it’s exiting the birth canal. Wow! That’s a stretch!

But wait! Jodi Jacobson, Editor in Chief of RH Reality Check, a Reproductive and Sexual Health and Justice blog says it was never when life beings because “life begins at conception.” Huh?

OMG! Wasn’t the abortion debate all about women having access to clean safe medical facilities so that when they were seeking this “medical procedure” the mother’s health would not be at risk? The fetus, or as it’s been called “blob of cells,” needed to be removed to save the mother.

You were duped!


Read more at http://therealside.com/2014/08/i-told-you-it-wasnt-a-womans-health-issue/#L9t6j1vAXCU2XaUl.99

The Failure of Obamanomics

Obama failures

net-worth-chart-2009-11The strongest component of the Federal Reserve’s Leading Economic Indicators currently is stock market performance. Such equity strength is more a case of artificial stimulation by the Federal Reserve through Quantitative Easing and the cozy relationship between Washington and Wall Street than it is a sign of a healthy economy or White House policies that have been conducive to growth. After nearly six years of President Obama’s economic policies, there is unmistakable evidence that White House policies have severely hampered economic viability.

The middle class real median household income in 2012 was less than it was at the end of the ’80s, and it’s down 9 percent from its high in 1999. The biggest portion of that decline, 8.3%, came in just the past five years.

6a00e54ecbb69a8833019104b3ec19970c-800wiThe median net worth of a family in 2010 was $77,300, compared to $126,400 just three years earlier. In 46 of our 50 states, the poverty rates have increased over the past six years, and the national poverty rate is over 15% for the fourth year running. The last time that happened was in 1965. More and more families are dropping from the ranks of the middle class into poverty.

One of the greatest factors adversely affecting median household income and net worth is the loss of jobs and extended unemployment. According to the Bureau of Labor Statistics (BLS) the Participation Rate, which is represented as a ratio or a percentage of the total population, is at the lowest levels in 50 years, with about 62.8% of the population working. According to the BLS U-6 data, 13% of the population is still unemployed or underemployed, and marginally attached to the labor market.

The job situation is directly effected by administration policies, and will not improve appreciably until the cost of doing business starts dropping. Last year the Small Business Administration reported that regulation costs American business $1.75 trillion per year, and costs small businesses as much as $10,585 per employee. Just the costs of Obamacare, Financial Regulatory Reform, and new EPA regulations, are projected to increase that cost per employee as much as 30%, according to Investor’s Business Daily.

37242E8628A0435CBA8B05A16E7BCE50In 2012, the President said, “This country doesn’t succeed when we only see the rich getting richer. We succeed when the middle class gets bigger. We grow our economy not from the top down, but from the middle out.” He was correct. But none of his policies have done what he gives such great lip service to.

In spite of the president’s consternation over income inequality, the income gap has increased exponentially under Obamanomics. As MSN Money declares, “The top one percent of Americans — those earning above $366,623 a year — have taken 81 percent of the fruits of the recovery. And the top 0.01 percent — earning about $8 million a year — took an astonishing 39 percent of the growth.”

Worst Post-Recession Recovery

Worst Post-Recession Recovery

Let’s look at the economy in general. The National Bureau of Economic Research officially scored the recession as ending in June, 2009, just five months after Obama’s inauguration. Historically, the nation has rebounded with significant growth coming out of a deep recession, but this has been the most tepid recovery in the last 100 years according to Forbes. They point out, “Under President Obama the American people have now suffered the worst 5 years since the Great Depression.”

Steve McCann of the American Thinker earlier this year wrote, “Instead what America got by year five was fewer jobs than before. Even though the employment age population has increased by nearly 12 million since January, 2008, there are now 3 million fewer Americans working, with employment declining from 146.3 million in January, 2008 to 143.3 million in December, 2012. If America enjoyed the same labor force participation rate as in 2008, the unemployment rate in December, 2012 would have been 11.4%, compared to 4.9% in December, 2007.”

OG-AB775_GDP061_G_20140625093832The latest revision of 1st quarter GDP growth was adjusted downward to -2.9%. Another quarter of negative growth, or economic contraction, and we’ll be officially in another recession, and it will be primary due to the policies that have restricted job growth, saddled the private sector with an average 91,000 pages of new regulation per year added to the Federal Register, and decimated the middle class.

Every one of these data are adversely affected by policies of the administration over the past six years. There have been precious few initiatives implemented that have facilitated free market principles in an attempt to augment economic expansion, job growth, or reduced fiscal burdens bourn increasingly by the middle class. Instead we’ve had nearly 550,000 pages of new regulation added to the Federal Register, and dozens of Executive Orders that have stymied the engine of capitalism that fuels the country.

The new Dow Jones Industrial Average record reached last week is good for investors, but belies the broad-based weakness in the general economy. With two years left of this administration that is so averse to free markets, a substantive and vibrant economic recovery will likely be elusive for the foreseeable future.

Associated Press award winning columnist Richard Larsen is President of Larsen Financial, a brokerage and financial planning firm in Pocatello, Idaho and is a graduate of Idaho State University with degrees in Political Science and History and coursework completed toward a Master’s in Public Administration. He can be reached at [email protected].

 

America Remains World’s Top Energy Producer

America #1 energy producer

America #1 energy producerBank of America reports that the United States will remain the world’s top energy producer this year and for some time to come despite the current administration’s attempts to curb energy exploration and transportation.

President Obama has done everything within his power (and some things not so within it) to suppress American energy production. As Bank of America reported, America’s energy producers have refused to give in.

U.S. production of crude oil, along with liquids separated from natural gas, surpassed all other countries this year with daily output exceeding 11 million barrels in the first quarter, the bank said in a report today. The country became the world’s largest natural gas producer in 2010. The International Energy Agency said in June that the U.S. was the biggest producer of oil and natural gas liquids.

Questionable regulations and preventing the completion of the Keystone XL pipeline have been top priorities of the Obama administration while millions of Americans struggle to put a full tank of gas in their vehicles or pay other energy bills. Thanks to American energy producers, things have been kept at least survivable. BofA’s head of commodities research said that “the shale boom is playing a key role in the U.S. recovery. If the U.S. didn’t have this energy supply, prices at the pump would be completely unaffordable.”

Unfortunately, despite the best efforts of American producers, President Obama’s failures in the middle-east are keeping gas and energy prices artificially high.

“The shale production story is bigger than Iraqi production, but it hasn’t made the impact on prices you would expect,” said Blanch. “Typically such a large energy supply growth should bring prices lower, but in fact we’re not seeing that because the whole geopolitical situation outside the U.S. is dreadful.”

One way or another, it would seem that we will see energy prices “necessarily skyrocket.”

HuffPuff Propagandizes a FOX Reality

Unemployed

I go through the headlines and news stories in over one-hundred publications daily. I do this so that I can view multiple sources on some of the same stories. Doing this allows me to formulate what is fact and what is disingenuous spin; propaganda meant to trick the public into thinking one way instead of another. Make no mistake, both ideological prospective do it. It’s the art of modern political war. But the Progressive Left has myriad vehicles to attack the ideological Right, where the Right has many fewer (thank you uber-stingy money people on the Right).

A perfect example of the Left’s disingenuous attack on the Right’s information sources comes in an article in the Huffington Post by Jack Mirkinson titled, FOX News Really Doesn’t Want to Talk About the Good Jobs News, where he writes:

“Quick! Can you find Fox News’s coverage of the latest job figures?”

He includes some main page screen shots.

“Still can’t find them? OK, we’ll help you out. What if we zoom in?…OK, OK, we’ll show you! The link is that little one right in the corner there…For some reason, FOX News appears to want to downplay the very good job numbers. For good measure, the network also downplayed the figures on its airwaves as well.”

He then goes on to show how the far-Left mainstream media outlets dutifully took the Obama Administration’s spun numbers touting them as miraculous by supplying one – one – example: a screen shot of CNN’s breaking news on the numbers.

The good numbers that Mr. Mirkinson points to are the BLS statistic that 288,000 jobs were created last month. Is that good news? Yes. Is it the miraculous news Mr. Mirkinson suggests? No.

Throughout the Obama Administration the majority of the jobs “created” have been either service industry jobs or part-time jobs. College graduates remain woefully under-employed and those experienced in the workforce who have been downsized or otherwise screwed out of a job find it almost impossible to find work. And if you are over 50 and have been out of work for a period of time, you might as well come to grips with the fact that you have become unemployable under Mr. Obama’s economy.

Where the Obama Administration and its sycophants want everyone to believe that the creation of 288,000 jobs is the greatest news since sliced bread, the facts remain…and they are not good.

▪ The U3 unemployment rate hovers at 6.1%. The U3 rate measures the unemployment of people who are without jobs and who have actively been looking for work within the past four weeks.

▪ The U6 unemployment rate hovers at 12.1%. The U6 rate reflects “discouraged workers,” or those who have stopped looking for work because current economic conditions make them believe that no work is available for them; “marginally attached workers,” or “loosely attached workers,” or those who “would like” and are able to work, but have not looked for work recently; and part-time workers who want to work full-time, but cannot due to economic reasons.

▪ The Labor Force Participation Rate is stuck at 62.8%.

These statistics mean that in a country of 318 million legal citizens, 92.2 million eligible for employment are without work. Almost one-third of the population is unemployed.

Further, the rate of those not in the labor force has exploded since 2000. Over the past 14 years – and predominantly during the Obama years – we have removed 14,022,376 from the labor force who are eligible to work. That’s over 1 million eligible workers removed from the workforce each year, on average.

So, understanding the reality behind the unemployment data – disingenuously termed the “jobs numbers” by the talking heads, when more accurately they should be referred to as the “jobless numbers” – how can anyone celebrate the creation of 288,000 menial and part-time jobs when we add one million people a year on average to the under- and unemployed demographic?

The American free-market Capitalist system is the only economic system to have ever – ever – created a Middle Class in the history of man. In its purest form it made the United States of America not only the world’s preeminent superpower, it made the United States the “land of opportunity.” Today, that is hardly the case. The Middle Class is disappearing are a rapidly increasing rate and opportunity is disappearing from our economic lexicon. Why, you ask? The answer is simple: the government manipulation of the American free-market Capitalist system.

Special interests in government have saddled the small business sector with an overwhelming number of regulations, while newer and more intrusive mandates continue to smother the job creators, literally stealing food from the mouths of the hungry in the form of disappearing opportunity.

Obamacare, environmental zealotry, socialism in the form of labor union oppression, manipulation of free commerce, all of these economy-stunting and job-killing maladies are introduced into the American free-market Capitalist system by government and the big-money, well-organized special interest groups that see success and American exceptionalism as a cancer, not a cure. Sadly, today, these creatures of negativity and societal destruction are in power…and on both sides of the governmental political aisle. Unless we shift the political paradigm radically back towards true limited government, it is only a matter of time before our Republic is lost.

So, Mr. Mirkinson, the jobs news is good? Please. The jobs news sucks.

As we celebrate the 238 anniversary of the Declaration of Independence, we should all be willing to look at the chains upon our wrists and ankles. We have allowed ourselves to become slaves to an oligarchic elite and their special interest benefactors. They feign concern about unemployment as they try to tell you they are just like us. That couldn’t be further from the truth. Case in point: Mrs. Clinton’s comment about being “flat-broke” when she and the former President left the White House. How does someone who is flat-broke acquire a multi-million dollar mansion in Chappaqua, New York and maintain two “summer cottages” in Ireland being flat-broke? It’s a lie, and one meant to deceive.

The good news it this. We can remove those chains and get back to good. We can free ourselves of the disingenuous and elitist oligarchs with which we are currently saddled. We have the power and it is a power that begins with the ballot box and navigates the seas of prosperity through limited government.

The time is now. Let us not be faint of heart.

China, Russia and South Korea Make Moves Away from Dollar

weak-dollar

weak-dollarBRICS (Brazil, Russia, India, China, S. Africa) is the acronym signifying the next generation of economic power houses. Increasingly, these, and nations like them are working to diminish the U.S. Dollar as the World’s reserve currency. This week, China and Russia took more steps towards that goal.

China’s central bank has authorised the Bank of Communications, the country’s fifth largest lender, to undertake yuan clearing business in the South Korean capital, the People’s Bank of China (PBoC) said in a statement.

That action clears the way for China and South Korea to trade in Yuan (Remnibi) for transactions between their two countries thereby releasing them from use of the U.S. Dollar for international trade.

Russia has been working tirelessly with China and other BRIC nations towards the same goal – freedom from the Dollar and the IMF. As more nations set up clearing houses for other than dollar transactions, the Dollar will become less important in international trade.

China, Japan and Russia have already agreed to similar currency use between them. Chinese currency use for trade in Africa is also rapidly increasing.

Next week, Russian President Vladimir Putin will begin a tour of several Latin American countries, including Brazil.  No doubt, decreasing dollar dependence will be on the agenda.

With more than 60% of the World’s currency reserves being held in U.S. Dollars, this increasing trend will have impacts.

The first, and most obvious impact will be massive inflation – in both the cost of goods and the cost of money. The dollar’s value will decline and make food, clothing, gasoline and just about everything else cost much, much more. Interest rates will skyrocket and make borrowing money just about unaffordable.

A portion of the rest of the world envisions a world without America. Some are making sure it happens.

 

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