Turmoil in the Middle East

I realize the title of this blog is like saying “Democrats want bigger government,” because it seems like there is always unrest in the Middle East, but I believe we are going through a historic period in that part of the world. There is more freedom being unleashed with the toppling of autocratic governments and brutal dictators like Saddam’sIraq,Egypt,Libya, andTunisia than at any time in the last 100 years.

Unfortunately, it is looking more and more like this opportunity will be squandered instead of seized upon. Why is that? Because the leaders of these movements are turning to Europe andAmerica for help at the same time Europe andAmerica are abandoning and dismantling those very same freedoms.

I have watched the uprisings very closely and one theme is predominant throughout. Once the crowds have been given the chance to vote they end up right back at the same spot a few months later demanding more from the new government. The key phrase here is demanding more from the government. They have not learned the responsibilities of freedom and the glorious anarchy that is the free market system. They do not understand even the most basic concepts of it. It is not because they are incapable, but I believe that the problem is they are following the current example set by the Western countries.

The example that the governments of the West are setting is that government is the solution to all our ills. Listen to the protestors in theMiddle East. They sound like the mobs in Europe or the Occupy Whatever protestors who demand something from the government without thought or care as to where it comes from. “Help” from the government comes with a high price that the people of theMiddle East will eventually have to learn the hard way. Many times the hard way ends with a megalamaniac like a Hitler, or the current leader of Iran!

This typically means that things will have to get worse before they get better and this is what I see happening over the next 10 – 20 years. It will take a while for the protestors in theMiddle East to realize that replacing a large autocratic government with a large one elected by the people does not accomplish anything. Only when the newly free of the Middle East discover that government “help” impedes progress, instead of the opposite will real strides be made towards a thriving and stable Middle East.

The Economy Part 2 – Medicare/Social Security/Health Care

Perhaps the biggest problem of all right now is probably our desperate need for entitlement reform. Medicare, Medicaid, and Social Security are all on the path to bankruptcy in the next 25-30 years and no amount of tax increases can prevent this. Perhaps one of my favorite editorials ever came from the Wall Street Journal a few years ago. In it they added up the cost of Obama’s new spending plans on a yearly basis and then looked at raising taxes on the rich to pay for them. Using 2007 tax receipts (the last good year of tax returns prior to the recession) they hypothetically taxed all of that income at 100% so the government would collect every last dime from people they consider to be rich! A 100% tax rate was not enough to cover all the additional spending!

When Medicare/Medicaid started in 1969  I believe it cost around $9 billion. The geniuses in Washington estimated that by 1990 the cost would double. Do you know what happened? The cost by 1990 was 50 to 100 times more than what they estimated. If any businessperson was that far off on an estimate they would have been fired immediately and their plan scrapped for something that actually worked. Medicare/Medicaid in its current form will be bankrupt by approximately 2024. That is not very far off. No problem though because Obamacare is here to save the day!

Obamacare is going to give more people “free” insurance through the government and not cost a dime more. What a great deal for everyone. How does this happen? Well first he has found $600 billion in “savings” from the current plan. This $600 billion in savings are cuts to doctors that take medicare patients. For twenty years now Congress has been saying they are going to cut payments to doctors and at the last minute they always change their mind. This is because they are in the ultimate catch-22. They know the cost of medicare is exploding and has to be contained. They want to pawn off the extra cost by cutting payment to doctors but there is one problem.

Doctors and hospitals are already losing money on these patients and if their reimbursement gets even less they will simply stop taking medicare patients as some are already doing. This is already one of the biggest causes of rate increases in the private sector. Rates for people with private health insurance are increased dramatically as doctors must charge health insurance companies more to make up for the money they are losing from medicare patients. The government cannot look like the villain so they always reinstate these cuts just before they go into effect so the doctors will continue taking medicare patients at a slight loss.

So the $600 billion savings is a complete scam. If that is not bad enough they then take that faux $600 billion in savings and spend it on adding more people to the medicare rolls as patients, but they still count the $600 billion in cuts as “savings”! This is like me cutting my personal budget by $300 per month and then taking that money and spending it elsewhere each month and claiming I am saving money. No wonder this country is bankrupt!

The other major gimmick behind Obamacare has already been blown up. The administration was recently forced to abandon the long-term care insurance they were going to offer. This program was so bad that even government accountants could not game it enough to make the numbers work. Here was their plan though. They were going to offer long-term care insurance to the public. They would collect these premiums for a minimum of ten years before they would have to start paying out any claims so during these ten years they would have all this additional money on the books to make Obamacare look like it did not add any money to the federal deficit. Never mind the fact that after ten years they would have to use all the money to pay the claims under the long-term care insurance that people purchased. These government wonks tried every which way to fix the numbers so it looked solvent but it did not work and they were forced to give it up. (The only reason they gave it up is because a Republican stuck an amendment into the bill that said the program had to be paid for.)

The real goal of Obamacare is socialized medicine. Any person with half a brain who looks at this plan can recognize this. You have a plan that adds millions of people to a government program that already underpays doctors and hospitals. As more and more people get added to the government rolls it puts more and more pressure on private sector rates. Eventually these rates will be too expensive for companies and/or individuals to pay and they will be forced into medicare. At some point in the next ten or twenty years enough people will get moved onto the government plan and there will not be enough consumers left to sustain private insurance. It collapses and the government is all you have left to administer your care. This is what most leftist politicians think is free market competition.

There are numerous ways you could lower the cost of health insurance but left-wing democrats have no interest in doing it. Lower cost means someone may be able to afford something without their help. The first option is to allow people to buy health insurance across state lines. Right now if you are in states run by liberals like California or New York for example your health policies cost ten times what they are in other states because you are forced to buy a policy that is only sold in your state and that policy must cover anything under the sun. Imagine if you had to buy all your other items like this? Take food for instance. You could not buy anything in the grocery story unless it said “Made in New York” or “Made in Ohio” on it. Your options would be pretty limited. Think your grocery bill would be a hell of a lot more than it is now?

The next major item would be tort reform. Doctors are paying through the nose for malpractice insurance in states run by liberals. Look at the states that have passed tort reform. Texas used to be one of the worst in the nation when it came to lawsuits. They passed tort reform and doctors are rushing to the state. Liberal politicians have no interest in cutting costs though. Cutting costs means cutting their power as well and that cannot be allowed to happen. If there is robust competition and plenty of options to keep rates down then their power is diminished.

There is one area of health care that has had rates actually go down over the last ten years. Do you know where? Plastic surgery rates have gone down. Why is that? Must be those evil rich people getting something for nothing again. Plastic surgery has gone down because the government is not involved in any way shape or form with what the consumer purchases. The consumer must shop for prices and they see the bill that must be paid up front. This dramatically changes consumer behavior. This is common sense. Ever have someone give you something? It is certainly nice to get something for free but do you treat that free couch the same as you do the nice leather one you saved up for and bought with your hard-earned money? I know I do not treat them the same.

You can also look at the prescription drug plan the Bush administration passed. It is the only government program in history to come in way below the estimated cost. Why? Because private companies were bidding for customers and seniors got to choose a plan from competing companies. Leftists hated this plan even though it was an expansion of government. You would think they would love Bush for expanding medicare but they hated him for it. I was not thrilled with the expansion of government but if the government did not pay for the prescriptions then medicare would eventually pick up the medical costs that resulted from the person not having access to the drugs. We end up paying for it either way and if the drugs prevent major surgeries and/or extended stays in the hospital it could be saving money overall.

The next fun item on the agenda is social security. This government program is scheduled to go bankrupt sometime around 2035, but if you want to change it so it will last longer you secretly hate the elderly! The first thing that needs to be done is to raise the retirement age. The retirement age of 65 has been the same since social security began in the 1930s! Obviously people are living longer now and this should be slowly adjusted to account for that.

For the record social security in its current form is a ponzi scheme. A ponzi scheme takes money from people on the promise they will invest it and return more money to them at a later date. The money is never invested though. The schemer (aka federal government) takes money from the next person in line and gives it to the first person who paid (aka sucker). This continues as long as the schemer can convince more and more people to give them money. Once the game is up, the house of cards collapses. In this case the schemer (aka federal government) is simply running out of suckers (taxpayers) to collect from. This system will eventually collapse due to the fact that people are living much longer now and there are less and less workers to pay for the benefits.

If the federal government actually would save the money that comes in on social security taxes for the actual recipients it would help push back the insolvency date by many years. The dirty little secret though is they have been collecting all these social security taxes for 30 + years and instead of stashing it away for social security they throw it into the general funds of the government and spend it each year. (there is no lockbox as Al Gore once famously said) They never save it for the recipients. They just waste it on spending binges. The DC political establishment bluff was called on this in 2005. After politicians refused to consider giving taxpayers the opportunity to invest their social security taxes  the White House suggested simply diverting social security taxes into separate accounts in the individual taxpayers name. This way it would be their money to do as they please at age 65 and if they die prematurely that money goes to their families instead of back into the hands of corrupt politicians. I am sure you will not be surprised to learn that politicians turned this down.

If you allowed taxpayers if they so desired to invest their social security taxes in conservative mutual funds the compounding interest on these personal accounts would be vastly superior to what they are receiving now. You can take any 30-year period in history and the stock market has always gained during that time. Who would you rather have managing your money; D.C. politicians or a mutual fund manager? If you prefer a politician you are a lost cause.

Bush tried to reform social security in 2005. He asked for any plans to be put forward and left nothing off the table. Everyone in D.C. gave him hell and pretended there was not a problem. They scared seniors and he was forced to abandon it. At the time the Republicans controlled the House, Senate, and Presidency but they did not have a filibuster proof majority of 60 in the Senate so nothing was even brought to the floor thanks to the Republican cowards in Congress. Funny how not having 60 votes did not matter when it was time for BHO to ram through Obamacare! I guess those pesky rules only apply to Republicans. Obamacare had to be passed or we were nothing but racists. Were Bush’s plans perfect? No, not too many things are, but he tried to have an honest discussion about it. The lifetime politicians do not dare discuss these issues though in any substantial or meaningful way since it could easily cost them an election.

 

Politics, The Economy, & Foreign Affairs. Part 1 – The Tax Code

I have been closely following politics, foreign affairs, economic issues, etc for fifteen years now and I realized a few months ago that I had never put any thoughts down on paper. I still remember my early days when I gleefully voted for Bill Clinton. Times have changed and a few months ago I finally decided to just start typing and see what happened.  I was surprised to find the words flowing out, although pretty haphazardly so let me apologize for any rambling. Any numbers or facts that are wrong I also apologize for. This was an experiment to see how much I could recall off the top of my head without doing any research or verification.

The first item I will dive into is our tax structure. We constantly hear refrains from the media and left wing democrats about the rich not paying their fair share and that they need to fork over more money. The truly pathetic part in this discussion is that 48% of Americans pay no income tax at all! Thus, they have no skin in the game. This is a joke. As long as it is the law, allU.S.citizens should pay the income tax, pure and simple. And I mean pay it and not have tax credits that result in a refund larger than what you paid! This is part of the reason the flat tax has had problems catching on in certain quarters. That 48% could end up actually having to pay an income tax if the flat tax came into being.

            If democrats were truly interested in more revenue they would lower taxes. It is a fact that every time taxes have been lowered, revenues to the federal government increase! The Kennedy, Reagan, and George W. Bush income tax cuts all generated massive gushers of cash to the federal government. You would think lefties would like this, but they do not.

Why? Pure and simple; power. When you choose the winners and losers as much as possible, when you force them to navigate 10,000 plus pages of a tax code, you are in command of the money and where it goes. Lefties would rather have $5 to dole out to whoever they think deserves it as opposed to having $10 come in that was generated by a business. The business may be growing and hiring workers, possibly even workers that at one point relied on federal assistance. This is anathema to lefties. Profit is just a necessary evil to fund the government in the eyes of democrats.

To prove this point just go back to the 2008 presidential campaign. Charlie Gibson of ABC asked Obama about his plan to raise the capital gains tax. For some reason Gibson admitted the truth and pointed out to Obama that when this tax is lowered revenues to the government actually increased so why would he do the opposite? His answer? It was about fairness. Lefties want equality of outcome, not equality of opportunity.

            If the government simplified the tax code by instituting a flat tax or just two tax brackets like 5% and 15% the economy would consistently average 3-4% growth minimum and probably much higher. There are millions upon millions of work hours wasted each year trying to comply with the hundreds of thousands of rules and regulationsWashington DC heaps on us. Simplifying the tax code would free up a large chunk of this time and allow businesses to do what they do best; figure out ways to help their clients, which makes them more money, and helps them expand and grow their business by hiring additional employees. It truly is that simple.WashingtonD.C.wants to make you think a simple tax code will destroy the economy but it’s the exact opposite. This is the only way to save it.

They said much the same thing about the Reagan tax cuts which even George HW Bush called “voodoo economics” during the Republican primaries in 1979-80, but the Washington establishment was wrong then just like they are wrong now.  We have a tax code now where fewer and fewer people pay into it, and these same people are the ones receiving their housing subsidies, food subsidies, and medical care via programs like Medicaid/Medicare.

            Should we help the ones who truly need it? Of course, there will always be people who truly need help, but many of the people currently living a life almost wholly dependent upon the government are capable of much more. Unfortunately, they do not realize that politicians are using them to stay in power. If they break the cycle of dependency and realize what they are capable of, then they no longer need the government. This is unacceptable to lefties so they make sure the vast majority of the poor never get that opportunity. They do this by failing to educate them via the pathetic public school systems we have.

            Lefties always tell you that we cannot afford tax cuts. This is a completely false premise. First of all, it is our money, not theirs. Secondly, taxes are not a zero sum game. Liberals always argue that tax cuts must be paid for. While they may generate a small reduction in tax revenue up front they always create much higher revenues to the federal government after they have been in place for a year. This has been proven time and again in history.

A dirty little secret is that in 1920 theUSwas in a deep recession just as bad as what occurred in the 1930s. However, the Republican president at the time (Harding) did the exact opposite of what was done in the 30s. He cut government and lowered taxes and we had the roaring 20s. The depression of the 30s lasted the entire decade. When World War II started unemployment was still over 20% despite massive federal spending under FDR.

Nowadays these liberals act like we should just be thankful for what they decide to give back to us. You are “rich” if you make more than $200,000 per year. The key thing they always leave off is that most $200,000 plus earners are small businessmen. They are typically filing their taxes on their individual returns so $200,000 is what they earned with their small business. They then paid for their business expenses out of that 200,000, then whatever is left over after taxes goes to the family to cover the family bills. They are not getting a check from an employer, instead they have to cover all their expenses for their business plus their family. This is a heck of a lot different than collecting your 200,000 paycheck from GE and then using all that money for just your family needs.

            Lower taxes generate more economic activity from these small business entrepreneurs which in turn creates a bigger pie that everyone who works hard can get a piece of. Lowering taxes is good for everyone in this country, except left wing politicians.  That is why they fight tooth and nail against them. The top tax rate was 90% in the 1950s until JFK lowered it to 70%. In 1980 Reagan lowered it again to 28%. Do you think anyone every paid that top tax? Of course not. No one can pay that much of their income to the federal government and survive. After you add on state taxes they would be nearing 100% of their income. The key here is the thousands of loopholes and carve outs in the tax code that are utilized to lower your tax burden. How are these carve outs generated? Lobbyists come begging to their particular representative for help. The more government regulations and rules there are, the more there will be lobbyists fighting for special exceptions. I do not blame them. The tax burden on the top 50% is onerous, and democrats want the rich and big corporations paying to play. This keeps them in line and prevents them from straying too far from the government plantation.

It makes me sick when someone like the current CEO of GE claim that we should stop being afraid of the government. Considering that his company was able to finagle their finances to pay almost no taxes last year I find it highly ironic that our socialist president embraces him. This proves that if you spend enough money in DC pandering to these types, they will let you do whatever you want. The day I hear a CEO of a major corporation say they will send no lobbyists to D.C. I will be first in line to give that company some business!

            This brings us to the corporate tax rate. The corporate tax rate is 35%, which is currently one of the highest in the world. Who pays the corporate tax rate? You do of course. The 35% is lessened as much as possible through whatever tax credits companies get handed to them by the lackeys in Washington and the rest is passed on to the consumers. Most companies have stockholders to keep happy and they expect a good return on their investment. I have no problem with a company doing what is necessary to keep their tax burden low, it helps keep the cost of my consumer goods down, but consumer goods would be substantially cheaper if we had a government that simply enforced basic rules, instead of constantly creating new ones.

            These excessive rules are a stealth tax that hurts no one more than the poor. The vast majority of products have all sorts of extra costs built in that make them cost much more than they should. Whether it is your electric bill, home renovation costs, consumer goods, or my personal favorite; oil, the government is driving prices one way and that is up. 30% of the price of oil is taxes. Does anyone in government ever talk about that? What do you do when you see increases on these consumer goods? You blame the company. So it is another double win for the government. They collect more money while passing the blame and the cost of collecting the tax off onto to someone else.

            Nothing irks me more than the constant attack on oil companies. The average oil company profit margin is around 6%.  This means there is only a 6% difference between their profit and their expenses. In other words, if they make $100,000 in one day, they spent $94,000 to make that $100,000. A profit margin of $6,000. Politicians scream about the $100,000 figure, yet they always forget to mention the $94,000 spent to reach it. This profit margin is extremely average. This is mainly due to their very large fixed costs and long time frames between the actual discovery of oil and when it begins yielding any profit. Companies like Google, Apple, etc have profit margins of 20 plus percent.

            Yet companies with a 6% profit margin are called greedy and evil for providing a commodity that is literally the engine that drives every economy in the entire world. No knock against Google or Apple. They have created things that have improved the lives of almost everyone in the world. Google makes its money by providing a free service and their reward is to be hauled into Congress for being a monopoly.  That being said, if necessary you can do without a lot of items offered by these companies (I still do not own an iphone and am somehow surviving), but you cannot do without oil. You want to know how many things oil is used for? Just Google it!

Why did I write Agent of Influence?

I really had no idea what to blog about on my first post . Luckily I was slow in getting my blog up so I had months to consider the question until I finally came up with an idea. One question that constantly came up when I admitted to friends and family after seven years of toiling that I was going to publish a novel was ,why? I guess the answer is twofold.

First, for anyone not familiar with the novel I would refer to it as a political thriller and while writing a novel is extremely difficult, doing research for it was pure joy for me. It allows me to indulge my passion of reading (particularly history books), traveling, and politics. I think anyone who even slightly peruses my website or facebook page will see that I am conservative but that is a discussion for another time.

Ever since I was 18 years old I have been saving articles from newspapers, magazines, etc that I found interesting and storing them in case they could be of use for me in some way. Some I thought could be used for a novel (I believe most good fiction starts with a real life occurrence and expands on it in some way) and some were relatively minor stories at the time but I thought it possible they could eventually morph into something bigger.

This is how Agent of Influence developed for me. For years I have been fascinated by WWII (I have finished The Rise & Fall of the Third Reich by W. Shirer and am currently halfway through Churchill’s war memoirs) and always wanted to utilize it in some way. Second, I was already becoming extremely interested in Bin Laden and Al-Qaeda even prior to 9-11. (Some of the articles I saved over the years were articles about Al-Qaeda prior to 9-11 so I do have some street cred here), and thirdly I wanted to incorporate my travels, particularly Las Vegas into the settings of the novel.

The final piece of the puzzle came during the California recall election and the election of the governator. There was talk he wanted to run for president and there was chatter in the media of amending the Constitution. This made me think about the ramifications of this and in my novel I amend the Constitution to allow this. One of my antagonists is a US President who has a questionable background.

I was prescient enough that when I finally published it in 2009 some friends of friends assumed I was making some sort of veiled reference to our current president. While I freely admit I despise the man there is not one thing I would ever copy from him.

My thriller is different than a lot of what is in the marketplace now because I follow the evolution of a plot over 40 years. One thing I have discovered with my research on Islamist fundamentalist terrorists is that the truly dangerous ones are patient and think long term. (as in decades or even centuries) This is why they pose such a danger to a country like ours which is full of politicians who cannot see past their next election cycle.

The second reason for writing my novel is simple. I would love to make some serious money. I will not sugar coat it or lie like so many people do. I feel like I have some talent and that I can make some decent money if the novel gets in the right hands.

If you like thrillers and fast-paced reads please consider giving mine a shot and telling someone else about it. Until next time…

Welcome to the Agent of Influence Page

Welcome to my page for my book, Agent of Influence.  I will be posting information about this book and other projects I am working on as well as views on various topics.  Check back soon for new material!