patrick.net

The oft-repeated lie that tax cuts increases revenue has been proven false many times over.

The most commonly cited case for this is the 1980s "tax cuts".

What most people don't know (or pretend not to) is that there were no tax cuts. The top marginal rates changed, but the total amount of taxes that people were paying didn't change much at all. What Reagan did was tax reform, not tax cuts -- his changes were designed at the outset to be revenue neutral. It was tax simplification, not tax reduction.

What it did do was shift the tax burden away from businesses and high income earners and onto the middle class, largely through the elimination of most deductions.

The increase in revenue came because the recession that Volker triggered to stop inflation finally ended. Yes, revenues go up when people are making more money -- who knew?

Flash forward now to the Bush tax cuts -- they did not increase government revenue.
Flash backward to the cuts of the 1960s -- they did not increase government revenue.

And, of course, the implication of the "tax cuts increase revenue" theory is that raising taxes will reduce revenue -- but there are no examples of this happening at the federal level.

Nomograph says

AdHominem says

NOMO, you don’t know what it is like to grow up in poverty. You don’t know what it is like not to have more than a few hundred bucks in a savings account.
You are an elitist. Your BIG BROTHER makes it possible for YOU to preserve your wealth at the expense of the peasants, who have essentially no chance of ever achieving what you have.

Every U.S. citizen has the opportunity to achieve what I have achieved, including you. I grew up in a family of modest means. I served in the military, went to school, earned M.D. and Ph.D. degrees and paid my debt entirely by myself. Anyone can do what I did, as long as they are smart enough and hard working enough.
I reject your claim that that the government is responsible for your lack of success. You can, right now, do what I did. Log off, join the military, go to school, study hard and get better grades than the competition, earn acceptance to medical school, pay off your debts, save and invest, and then you will have what I have. The path forward is perfectly clear.

Not that it is any of your business but I happen to be mildly successful when compared to my peers. Perhaps one day I will even be an elite like you. However, I am the exception. And you are too. And it still does not change the fact that all of us contribute too much of our labor to a growing Federal bureaucracy that is trashing freedom in favor of government control and corporate interests.

And if you want to deny that our bureaucracy is making it even harder for those in poverty to climb the ladder you are sadly deceiving yourself.

Your military suggestion is also laughable. You are suggesting I join and add further support to Empirical USA, pledging my life to obey orders to shoot, kill and occupy the lands of sovereign men, women, children and nations around the globe. Perhaps I will be one of the lucky ones like you who manage to retire before I get my leg or head blown off by someone defending their homeland. Or perhaps I won't be so lucky.

But none of this changes the fact that you are a loyal party member. You support the system because it has served you well (at the expense of others of course). And now that you are an elite you are able to continue to succeed using your property, MD monopoly on "medicine", and your relatively massive earnings potential as compared to the average, let alone below average American. Currency debasement doesn't bother you because you have plenty of it.

You have worked hard to get where you are. I am happy for you. But surely not everyone has the same opportunity, let alone the same results as you. And until we have a sound currency, a right sized government, and a parred down military (end the occupation of foreign lands), the little guys will continue to suffer at your expense Winston.

CBOEtrader says

Having a constitutionally limited federal government, while keeping the vast majority of government authority in state and local hands is a much better way to run a country

Just out of curiosity-what makes you think state or local governments will do things any better? California, Illinois, NJ, etc. sure don't seem to have any better ideas...

Doing everything at the local level is a lot less efficient, but the benefit is minimizing the damage when government does something stupid.

When I was taking my real estate classes last year, and being exposed to all the differences in state law wrt RE, I finally figured out what the Federalist Society was all about: full employment for lawyers, where 50 states have 50 different sets of laws.

The general idea that states should handle welfare etc isn't a bad one, though I don't know why the red staters are pressing this issue. Without Uncle Sam sending cash by the billions via military bases, ag subsidies, and the SS/SSI checks they'd be entirely screwed economically, reduced to the standard of living as shown on the "The Waltons". Perhaps they want that, dunno.

It doesn't matter what level government is done, what is necessary is intelligent actors. And I'm not talking Schwarzenegger, though he is in fact I guess an intelligent member of the acting profession.

tatupu70 says

CBOEtrader says

Having a constitutionally limited federal government, while keeping the vast majority of government authority in state and local hands is a much better way to run a country

Just out of curiosity-what makes you think state or local governments will do things any better? California, Illinois, NJ, etc. sure don’t seem to have any better ideas…

You named a bunch of "liberal" states. Try ND, NH, MT

tatupu70 says

CBOEtrader says

Having a constitutionally limited federal government, while keeping the vast majority of government authority in state and local hands is a much better way to run a country

Just out of curiosity-what makes you think state or local governments will do things any better? California, Illinois, NJ, etc. sure don’t seem to have any better ideas…

This is a great question, with an easy answer.

Of course local and state government politicians are no less corrupt than federal politicians. That is simple human nature.

However, the fact there are 50 states means competition. For instance, states have always been free to levy income tax, and many did so. However, the simple fact that the tax base was free to move to any state meant that states had to keep taxes low and government relatively efficient to keep its citizens happy. If one state, like California, wanted to implement a single payer health care system, citizens would be free to move to Arizona in protest, or move TO CALI in support of such a system.

Also, it is MUCH more difficult to steal, rob, or cheat someone that you know, who's family members you see in a town hall meeting, who's businesses you frequent, etc. Basically there is a much higher level of moral accountability within smaller political spectrums, than from an impersonal far off federal government.

It is also relative to point out how the passage of the 16th amendment turned state representatives and senators into professional beggars. These politicians try to statistically prove they are doing a good job by getting more pork spending into their districts than they pay to the government in taxes. Not only is this extremely wasteful, but this results in complete loss of state sovereignty.

As Frank Chodorov said in his "Income Tax: The root of all evil",

"Thus, every federal dollar spent in a state becomes an obligation on the state. The obligation is paid off with sovereignty; the state sells out its independence. It is all done without change of the law, without any modification of the Constitution, and is as imperceptible as the gradual wearing down of a proud horse by a resolute trainer."

I would love to hear some honest criticism of "Income Tax: The root of all evil" by one of the educated liberals in the forum.

http://mises.org/etexts/rootofevil.asp

CBOEtrader says

I would love to hear some honest criticism of “Income Tax: The root of all evil” by one of the educated liberals in the forum

I don't claim to be either educated or a liberal, but I find the essay to be less than persuasive. All the Judeo-Christian morality and talk of evil serves to get peoples' emotions going, but doesn't really present a good case.

For me the question is simple. The government needs revenue--everyone agrees to that. So, what is the fairest way to generate this while allowing the economy to flourish. Taxes aren't good or evil. They are just a way to collect revenue for the government.

tatupu70 says

CBOEtrader says

I would love to hear some honest criticism of “Income Tax: The root of all evil” by one of the educated liberals in the forum

I don’t claim to be either educated or a liberal, but I find the essay to be less than persuasive. All the Judeo-Christian morality and talk of evil serves to get peoples’ emotions going, but doesn’t really present a good case.
For me the question is simple. The government needs revenue–everyone agrees to that. So, what is the fairest way to generate this while allowing the economy to flourish. Taxes aren’t good or evil. They are just a way to collect revenue for the government.

It doesn't sound like you read the essay. Chodorov uses very logical arguments, and NEVER uses emotion baiting. You are also wrong about your premise. I, for one, do not agree that the government needs revenue. The federal government needs to massively cut spending, and give power back to the states.

CBOEtrader says

It doesn’t sound like you read the essay. Chodorov uses very logical arguments, and NEVER uses emotion baiting. You are also wrong about your premise. I, for one, do not agree that the government needs revenue. The federal government needs to massively cut spending, and give power back to the states.

OK--we'll have to agree to disagree then. Here's an example of what I meant:
Thus, the fabric of Judeo-Christian morality is undergoing deterioration as a result of the "evil" that has infiltrated our political life
How about this--boil down the logical arguments for me then. Just a few bullet points. And "income tax is evil" doesn't qualify.
And btw--I agree we need to reduce spending, but that wasn't the point of the discussion. There will always need to be some governmental revenues, so the question is how to collect them.

AdHominem says

You named a bunch of “liberal” states. Try ND, NH, MT

North Dakota population: 646,844, 70 acres of land per person (much of it highly productive), abundant energy resources -- it would be hard to screw that economy up. It also helps they get $1.68 for every $1.00 they send to DC.

Wikipedia: "North Dakota is also the only state with a state owned bank, the Bank of North Dakota in Bismarck, and a state owned flour mill, the North Dakota Mill and Elevator in Grand Forks."

OMG! ND has caught Teh Socialism!

New Hampshire, Population 1,324,575

http://www.businessweek.com/ap/financialnews/D9DM87LG0.htm

wut? They already have Teh Socialism too!

Montana, Population 974,989

Montana is one of the bigger Red State Welfare Queens -- taking in $1.50 for every dollar in taxes, so I wonder why you brought them up.

Now, I realize in your cartoon view of the economy we should all strive to be the rugged individualists of Montana and Alaska of the early 20th century.

No thanks. We can do better than that.

I would love to hear some honest criticism of “Income Tax: The root of all evil” by one of the educated liberals in the forum

I'm kinda neutral on the income tax; I believe what the taxman doesn't take off the top will just end up in rents and higher mortgage payments. Any dollar the goverment takes and spends wisely is fine by me, given the current fallen state of affairs.

The essayist you linked to happens to have been a Georgist like me, btw. If I were king I'd tax property first, last, and very hard.

None of this buying up SFHs to rent out. That's pure economic bullshit and if I were in charge I'd go Ho Chi Minh on such behavior. Proprietors leasing commercial space would know the ground rent they're paying is going to the local government and not some absentee LL living the good life off of their hard work.

After that, directly taxing incomes for such things as single-payer insurance, pensions, etc seems reasonable.

tatupu70 says

OK–we’ll have to agree to disagree then. Here’s an example of what I meant:
Thus, the fabric of Judeo-Christian morality is undergoing deterioration as a result of the “evil” that has infiltrated our political life

Well, in that particular section he starts off definining "evil" as the opposite of good. He then goes to explain that, "The American tradition rests its case squarely on the premise that the human being is endowed with rights by his very existence; that is what makes him human. Hence, any political action which attempts to violate these rights violates his human-ness, and thus becomes "evil.""

I really don't have time to create an executive summary of Chodorov's 50 page essay. Sorry, maybe another time. Though, the most important point would be how the federal income tax usurped the sovereignty from the states.

CBOEtrader says

I really don’t have time to create an executive summary of Chodorov’s 50 page essay. Sorry, maybe another time. Though, the most important point would be how the federal income tax usurped the sovereignty from the states.

lol--you have time to write 3 posts tonight, but you can't write a few bullet points? Whatever you say...

tatupu70 says

CBOEtrader says

I really don’t have time to create an executive summary of Chodorov’s 50 page essay. Sorry, maybe another time. Though, the most important point would be how the federal income tax usurped the sovereignty from the states.

lol–you have time to write 3 posts tonight, but you can’t write a few bullet points? Whatever you say…

Good point. I am writing this much today/tonight because I am procrastinating in writing up a business plan for a meeting with some venture capital types on Tuesday.

Writing down the actual bullet points clearly takes no time, but I would have to go back through his essay to make sure I could get the same umph out of my bullet points as his essay delivers. His 50 page essay is pretty densely packed with information. Chodorov, in general, is quite the writer. I suggest you read anything by him.

Troy, seriously, after hearing you call youself a Georgist for the fifth time, I went and read the Wiki. I must admit, I am intrigued. What paper, or writer would you suggest I look up if I wanted to know more?

Nomograph says

CBOEtrader says

I am writing this much today/tonight because I am procrastinating in writing up a business plan for a meeting with some venture capital types on Tuesday.

Good luck. The here in San Diego biotech VC guys can’t seem to scratch up a dime these days. Very little is getting off the ground.

Thanks man! We aren't looking for much and are very close to operating at a profit, so we have a shot. The most likely scenario is that we get money from another company in the business as part of a strategic partnership rather than an investment from a silent third party.

I am not expecting much from the venture capital types. That is part of why I am dragging my feet on writing this nonsense. They want projections that I have to pull out of my ass. I really don't want to pull anything out of my ass, and therein lies my problem with the VC jerks.

AdHominem says

By the way, is it possible for you to make an argument in a civilized manner without making an ass of yourself?

Perhaps you should read what you write. You are confrontational, accusing, lacking a factual basis and attack others who disagree with you (which seems to be many, many people). You don't debate, you cry victim and know not whereof you speak.

In other words, it doesn't seem possible for you to make any argument in a civilized manner, and you continually make an ass of yourself. Any pertinent argument you may have is lost, and don't AdHominem says

happen to be mildly successful when compared to (your) peers

at least when it comes to presenting valid arguments. Just because you've driven so many others away doesn't make you a winner. It does, however, make you a whiner.

You know, I don't even know why we bother arguing with people like this anymore. No amount of fact, logic, or reason will change his opinions.

And lets be honest -- it's not like his opinions matter anyway.

Troy says

AdHominem says

You named a bunch of “liberal” states. Try ND, NH, MT

North Dakota population: 646,844, 70 acres of land per person (much of it highly productive), abundant energy resources — it would be hard to screw that economy up. It also helps they get $1.68 for every $1.00 they send to DC.
Wikipedia: “North Dakota is also the only state with a state owned bank, the Bank of North Dakota in Bismarck, and a state owned flour mill, the North Dakota Mill and Elevator in Grand Forks.”
OMG! ND has caught Teh Socialism!
New Hampshire, Population 1,324,575
http://www.businessweek.com/ap/financialnews/D9DM87LG0.htm
wut? They already have Teh Socialism too!
Montana, Population 974,989
Montana is one of the bigger Red State Welfare Queens — taking in $1.50 for every dollar in taxes, so I wonder why you brought them up.
Now, I realize in your cartoon view of the economy we should all strive to be the rugged individualists of Montana and Alaska of the early 20th century.
No thanks. We can do better than that.

My point is that these states aren't broke. Are they? But otherwise it was a nice post you just had drama queen.

elliemae says

AdHominem says

By the way, is it possible for you to make an argument in a civilized manner without making an ass of yourself?

Perhaps you should read what you write. You are confrontational, accusing, lacking a factual basis and attack others who disagree with you (which seems to be many, many people). You don’t debate, you cry victim and know not whereof you speak.
In other words, it doesn’t seem possible for you to make any argument in a civilized manner, and you continually make an ass of yourself. Any pertinent argument you may have is lost, and don’t AdHominem says

happen to be mildly successful when compared to (your) peers

at least when it comes to presenting valid arguments. Just because you’ve driven so many others away doesn’t make you a winner. It does, however, make you a whiner.

Well coming from such a stable, nurturing and caring individual as you that really makes me feel.... satisfied.

Kevin says

You know, I don’t even know why we bother arguing with people like this anymore. No amount of fact, logic, or reason will change his opinions.
And lets be honest — it’s not like his opinions matter anyway.

right back atcha Kev

Nomograph says

AdHominem says

Your military suggestion is also laughable. You are suggesting I join and add further support to Empirical USA

I would never make such a suggestion. You made the somewhat bizarre claim that I belong to an elite class that has access to opportunities that you don’t have, and I simply pointed out that you have the exact same opportunities that I did.

Nomograph says

Log off, join the military,

looks like you said join the military. I guess I don't know if anything you say you mean anymore. The military is just the dirty strong arm of corporate America in its thirst for profit at any cost. The US military hasn't done much in the way of righteous might since it liberated the concentration camps. And even that was not our fight.

If you are not an elitist, what percentage of Americans do you think has the "exact same opportunities" and capabilities as you? Like I said, I am not claiming that you don't deserve your success, nor that it can be achieved by a few others who also work hard. I state merely that the opportunities that you have had are NOT there for everyone, and especially that poor people are not capable of preserving what little wealth they have due to the inflationary monetary system we have. Furthermore the powerful AMA has created a monopoly on medicine that puts you in an elite class and this fact warrants your recognition. And when it comes to the military it is the poor who tend to die on the front lines while the elites like GW Bush and perhaps Nomograph who get to stand under the "mission accomplished" banner and pose with the flight-suit.

Nomograph says

AdHominem says

If you are not an elitist, what percentage of Americans do you think has the “exact same opportunities” and capabilities as you?

Every US citizen has the same opportunities that I had. Not every US citizen has the same capabilities. It doesn’t surprise me that, beneath the rhetoric, you actually hate our free-market, merit-based society because you can’t compete, and you want some giant nanny-state government affirmative action program for low performers. First you want the government to handle your finances and savings for you, and now you want the government to decide who succeeds regardless of capabilities? Just how much of your life are you willing to turn over to the government? Are you afraid of freedom, AdHominem?

Actually I was hoping for a government that protects everyone equally. This means the man with $20 should be able to put his money in a bank and buy essentially the same amount of goods and services with in in 5, 10 or 20 years. Why should the man have to suffer the debasement of his currency? Government doesn't have to spend much effort or resources on this. In fact it takes great effort to debase a currency, you have to go out of your way to produce more FIAT dollars (of course in the digital age you just type a few zeros and press enter). It also requires a monopoly on money. Which is something we need to end.

The system that we have now guarantees that storage of wealth in dollars is a loosing investment, and in fact encourages mal-investment. This is to the detriment of the masses and the benefit of the elites. You are an elitist. You claim that everyone needs to be "smart" like you join the military (ie the Imperial US killing machine), buy property and game the system just like you. Everyone can't game the system, it is ponzi scheme. In an inflationary economy there have to be more losers than winners. Why? Becuase the lower class is always hurt worse than the elite upper class, they find it immensely more difficult if not impossible to make investments in "assets" that won't lose value. I don't begrudge you your status, (except for the monopoly of the AMA on medicine) nor do I think we need a Nanny state to make sure you and I and everyone else suffer the same. But what we do need is a sound monetary system so that savings is rewarded, debt is discouraged/costly, and mal-investment is not encouraged. If you think it is too much to ask that government protect a sound money system, then at least we need a government that allows competing currencies so that people can choose one that won't be debased on the free market.

Private property is the foundation of a free society. Private property includes currency. Unless we have a government that protects its currenc(ies) from debasement by the special interests and elites, the average and below average individual (the majority) will continue to lose freedom and his pursuit of happiness will be curtailed.

AdHominem says

Why should the man have to suffer the debasement of his currency?

That's the point. He doesn't have to... Buy inflation protected T-Bills instead. How hard is that?

AdHominem says

Becuase the lower class is always hurt worse than the elite upper class, they find it immensely more difficult if not impossible to make investments in “assets” that won’t lose value.

Again-that is the exact opposite of truth.

tatupu70 says

AdHominem says

Why should the man have to suffer the debasement of his currency?

That’s the point. He doesn’t have to… Buy inflation protected T-Bills instead. How hard is that?

You are funny. Why don't we just all use TIPS as our national medium of exchange then? One act of congress could give us this stable money system.

tatupu70 says

AdHominem says

Becuase the lower class is always hurt worse than the elite upper class, they find it immensely more difficult if not impossible to make investments in “assets” that won’t lose value.

Again-that is the exact opposite of truth.

Yeah, your probably right. Joe the plumber has the upper hand in earning and preserving wealth over Harriet the Heiress.

AdHominem says

You are funny. Why don’t we just all use TIPS as our national medium of exchange then? One act of congress could give us this stable money system

Because TIPS aren't a currency. They are an investment. When you want to store wealth, you buy TIPS. When you want to purchase goods or services, you use currency. Do you see the distinction?

AdHominem says

Yeah, your probably right. Joe the plumber has the upper hand in earning and preserving wealth over Harriet the Heiress.

OK--quick quiz for you Ad Hom. Which class has more wealth to store--upper or lower? And the followup-does inflation hurt people who save or people who live paycheck to paycheck more?

tatupu70 says

AdHominem says

Yeah, your probably right. Joe the plumber has the upper hand in earning and preserving wealth over Harriet the Heiress.

OK–quick quiz for you Ad Hom. Which class has more wealth to store–upper or lower? And the followup-does inflation hurt people who save or people who live paycheck to paycheck more?

Ok quick quiz for you TAT.
1. Who benefits most from the complicated tax code combined with an inflationary monetary policy; the guy who can afford a tax attorney and financial advisor or the guy who is trying to just save a hundred bucks a week for retirement?
2. If a guy with a million dollars loses ten percent, and a guy with 100 dollars loses ten percent, who is going to suffer the biggest loss in standard of living?

tatupu70 says

AdHominem says

You are funny. Why don’t we just all use TIPS as our national medium of exchange then? One act of congress could give us this stable money system

Because TIPS aren’t a currency. They are an investment. When you want to store wealth, you buy TIPS. When you want to purchase goods or services, you use currency. Do you see the distinction?

Money isn't an investment? Are you kidding me? It is not only an investment it is one that we are essentially FORCED to make or at least accept, for all debts public and private.

It seems to me we are both arguing almost EXACTLY the same point, just that you seem to think Big Government is somehow different than Big Business. In fact the two cannot exist without one another. Big Busness needs a big government to help it out and eliminate competition. The two are inseperable unless BIG GOVERNMENT RUNS ALL Business. So we see that Socialism, and the quasi-capitalism/big governments we have in the west are really just about the SAME EXACT thing.

In a free market, credit is expensive. Meaning risk is factored in to all credit agreements. We haven't had a free market in years, in any part of the world, because credit was so cheap it cost you money NOT to borrow.

That is not a free market and you know it. The Federal Reserve and our fraudulent fractional reserve banking system create malinvestment, and socialize risk while privatizing profit (central banks around the world working together did the same thing). That is what the creators of the Creature from Jekyll Island wanted and that is what they got. You can argue till your beak falls off but unless we have sound money we will never have a free market let alone a sound economy.

Nomograph says

DO think it’s the government’s job to watch over your wealth.

Wait, no did I just say that. No actually it was you. However it may be governments job to protect its citizens from theft. Rather than being the boss crime lord.

Nomograph says

NEWSFLASH: It’s your job to acquire, protect, and grow your wealth, not the government’s.

and who will protect me from "my" government?

"If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them (around the banks), will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered." Thomas Jefferson, Letter 1802 to Secretary of the Treasury.

Welcome to the future Mr. Jefferson.

AdHominem says

tatupu70 says

AdHominem says

Yeah, your probably right. Joe the plumber has the upper hand in earning and preserving wealth over Harriet the Heiress.

OK–quick quiz for you Ad Hom. Which class has more wealth to store–upper or lower? And the followup-does inflation hurt people who save or people who live paycheck to paycheck more?

Ok quick quiz for you TAT.

1. Who benefits most from the complicated tax code combined with an inflationary monetary policy; the guy who can afford a tax attorney and financial advisor or the guy who is trying to just save a hundred bucks a week for retirement?

2. If a guy with a million dollars loses ten percent, and a guy with 100 dollars loses ten percent, who is going to suffer the biggest loss in standard of living?

You still think the little guy benefits from inflation?

AdHominem says

Ok quick quiz for you TAT.
1. Who benefits most from the complicated tax code combined with an inflationary monetary policy; the guy who can afford a tax attorney and financial advisor or the guy who is trying to just save a hundred bucks a week for retirement?
2. If a guy with a million dollars loses ten percent, and a guy with 100 dollars loses ten percent, who is going to suffer the biggest loss in standard of living?

1. Didn't know we were discussing tax code. Where did you come up with that??
2. The million dollar guy for sure. $100K is definitely going to hurt him. I doubt that $10 is going to hurt anyone.

AdHominem says

Money isn’t an investment? Are you kidding me? It is not only an investment it is one that we are essentially FORCED to make or at least accept, for all debts public and private.

No--not kidding. Money is a currency. We are forced to accept it for debts, but we aren't FORCED to hold it. Most people keep some of it to pay the bills, and then invest the rest of it in whatever instrument they believe will give them the greatest return. If you believe inflation will erode the value of your dollars--then I recommend investing in an inflation hedge. You could invest in China or Europe, buy gold, buy real estate, etc... I just wouldn't hold a bunch of dollars, if I were you and believed what you believed.

There is fraud and waste in both the private sector and in government, but there is much more fraud and waste in government for the simple reason that that government workers lack the incentives to avoid wasteful decisions. If the Census bureau decides to spend/waste money on a Superbowl ad as they did last Sunday, there are no repurcussions, whereas in private industry, overspending on advertisements that don't provide a return means losing one's job, or forfeiting a bonus. As an example, many cities hire and pay workers to go to restaurants in order to harass the owners to display "our wines have sulfates" signs. Is that a good use of city resources? Of course not, yet those who make such decisions in government almost never pay a price, and in many cases they are rewarded with larger bureaucracies and more $$. Bad private sector decisions typically have negative consequences that govt. workers would not have to face. Hence, more wasteful, crappy decisions are made by government. Despite the poor economy, there is a federal jobs boom in DC, because they're spending other people's money.

Even worse, government legislates a different set of rules for themselves. Accounting rules followed by govt. would land a private sector company in jail for accounting fraud. Off-budget items such as Fannie/Freddie losses are commonplace throughout govt.

World improver's and do-gooders will always be with us. They spend more than they have, push and boss other people around and generally make the world a worse place to live. Paper money is a handy tool for world improver's. They use it like politicians use civil service jobs and generals use heavy bombers - to get what they want. Paper money is irresistible to morally corrupt politicians. It doesn't take much to increase the money supply by a factor of 10, or even 100 - simply add zero's. But adding zero's does not add value.

No paper currency has ever held its value. Politicians and central bankers (THE FED) want money they can debase. Gold on the other hand doesn't cooperate. Gold turns its back on world improver's, empire builders and do-gooders. Thats why morally corrupt people like paper "money" and hate gold or gold backed real money.

Recommended Reading: Empire of Debt, Bill Bonner. Also look up: Inflation, the effects of. And one more thing to drive "progressives" nuts...The Constitution.

It's comforting to see that Abe dropped by to post his regular talking points. He reminds of the carpenter who only has a hammer in his toolbox--everything looks like a nail to him....