Revenue isn’t the problem

Yesterday’s post dealt with the precarious financial situation Uncle Sam is in.  Interestingly, today I happened to stumble onto U.S. News and World Report’s ranking of the “Best States for Fiscal Stability.”

The top three are Tennessee, Florida, and South Dakota, in that order.  What do all of these have in common?

They are three of the eight U.S. States that still don’t have a personal income tax.  Tennessee does tax dividend — investment — income, but not wages.  But it relies mostly on sales taxes to pay its bills.  So why is it so stable?

For one thing, its Constitution requires a balanced budget.  Spending in a given year cannot exceed revenue collections and reserves.

Maybe Uncle Sam should take a trip to Nashville before he has to face the music.

UPDATE: as I was saying

That which can’t continue, doesn’t

The fiscal day of reckoning may be close at hand for the United States:

According to the U.S. Treasury Department’s Office of Debt Management, the U.S. government is just five years away from the point where every new dollar it borrows from the public will go toward funding interest payments on the national debt.

That is the main takeaway from the Debt Management Office’s Fiscal Year 2019 Q1 Report, which featured the Office of Management and Budget’s latest projection of the U.S. government’s borrowing from the public…

Net interest on the national debt has become one of the fastest growing segments of federal spending. When the national debt reaches the point where all newly borrowed dollars must be used to pay this mandatory expenditure, the U.S. government will have passed the event horizon that marks the boundary of the national debt death spiral.

Cities and territories in the United States that have crossed that crisis point have either gone through bankruptcy proceedings or their equivalent, or they have implemented major fiscal reforms that reversed their fiscal deterioration, wherein the best-case scenarios, they acted to restrain the growth of their previously out-of-control spending to restore their fiscal health.

Interest on the national debt is going up quickly for two reasons.  Obviously, the government continues to spend waaaaaaaaay more than they squeeze out of the economy (us) through taxation, adding to the total amount it owes.  More importantly, however, the many record deficits recorded over the past 10 years were done so at historically low interest rates (engineered by the Federal Reserve, which in the process robbed productive citizens of some of the proceeds they would normally have earned through their savings).  Inevitably, those rates have begun to climb again.  It may seem incremental on a chart, but keep in mind that just one percent of $22 trillion is $220 billion.

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Tariffs and national self-interest

Patrick Buchanan provides a succinct summary of why Trump’s emphasis on tariffs in the relationship with China is hardly unprecedented.  In fact, one could say it’s a return to the policies that once made a young nation great:

A tariff may be described as a sales or consumption tax the consumer pays, but tariffs are also a discretionary and an optional tax. If you choose not to purchase Chinese goods and instead buy comparable goods made in other nations or the USA, then you do not pay the tariff.
China loses the sale. This is why Beijing, which runs $350 billion to $400 billion in annual trade surpluses at our expense is howling loudest. Should Donald Trump impose that 25% tariff on all $500 billion in Chinese exports to the USA, it would cripple China’s economy. Factories seeking assured access to the U.S. market would flee in panic from the Middle Kingdom.
Tariffs were the taxes that made America great. They were the taxes relied upon by the first and greatest of our early statesmen, before the coming of the globalists Woodrow Wilson and FDR.
Tariffs, to protect manufacturers and jobs, were the Republican Party’s path to power and prosperity in the 19th and 20th centuries, before the rise of the Rockefeller Eastern liberal establishment and its embrace of the British-bred heresy of unfettered free trade.
The Tariff Act of 1789 was enacted with the declared purpose, “the encouragement and protection of manufactures.” It was the second act passed by the first Congress led by Speaker James Madison. It was crafted by Alexander Hamilton and signed by President Washington.

As Buchanan mentions, tariffs were once an integral part of an economic policy that became known as “The American System” — a policy so successful that other nations emulated it.  It’s worth noting the Federal government undertook its first infrastructure projects with almost no other source of funding other than tariffs (land sales being the main exception).  I’ll admit: I’m not a fan of the Federal government doing public works projects.  But the limited revenue stream tariffs provided kept such activity modest in the early republic, and for the most part it’s easy to see the wisdom of such projects as lighthouses, postal routes and the Cumberland Road.

Still, public works projects were controversial, even then.  Many in the South believed tariffs disproportionally benefitted northern industrial interests through protectionism and infrastructure.  Tariffs sparked the Nullification Crisis in South Carolina, and was cited as one source of discontent as States left the Union after Lincoln’s election in 1860.  Sectionalism aside, the nature of tariffs as a voluntary tax that promotes national self-reliance and internal growth recommends it as one of the best ways to fund a limited government.  Certainly, the explosive growth of Uncle Sam after institution of the Income Tax is evidence of that.  I’ve said before that a national sales tax would be preferable to an income tax (provided it didn’t result in both being in effect).  Many of the same reasons apply to tariffs.

Buchanan rightfully points out that abandoning so-called “free trade” for a tariff system that enforces fair trade will be painful in the short term, much like a junkie getting over their addiction.  American wages have been stagnant in inflation-adjusted terms since the 1970s.  The only reason we appear to have a higher material standard of living is the influx of overseas goods that appear cheap on the price tag, but which in reality take a heavy toll on the nation in terms of lost industries, disappearing jobs and a growing economic dependency on outsiders.  That doesn’t even take into account that many of the reasons goods made in places such as China are ‘cheaper’ is that they lack protections for workers and the local environment — impacts we considered so important here that we willingly added them to the economic burden of production.  In short, “free trade” as it’s currently practiced is an apples-to-oranges comparison that hides or downplays the negative aspects of globalism.

The value of the vote

Caution: this is a long post; that’s why it has a “jump break” on the front page of the blog.

It’s ironic that Bernie Sanders brought this up while I’ve been re-reading Heinlein’s Starship Troopers:

Vermont Sen. Bernie Sanders said he thinks every U.S. citizen, even the convicted Boston Marathon bomber Dzhokhar Tsarnaev, should be allowed to vote in American elections.  Sanders offered his stance at a CNN town hall Monday when asked whether he thought felons should be allowed to vote while they’re incarcerated, not just after their release.

He was pressed on whether it was appropriate to enfranchise sex offenders or someone convicted of a heinous crime like Tsarnaev, who with his brother carried out the 2013 Boston Marathon bombing that left three dead and injured hundreds more.

“Yes, even for terrible people, because once you start chipping away and you say, ‘Well, that guy committed a terrible crime, not going to let him vote. Well, that person did that. Not going to let that person vote,’ you’re running down a slippery slope,” Sanders said in response to a question about restoring felons’ voting rights.

It appears Sanders is saying everyone should have the privilege of voting, regardless what they’ve done in their lives.  That’s not merely wrong, it’s disastrously dangerous.  Unlike the (poorly done) movie of Starship Troopers, the book discusses in great detail the importance of the franchise.  Indeed, the book is highly controversial for presenting a futuristic society in which the only full citizens with voting privileges are military veterans.  Pardon the excerpt from one of the book’s classroom discussions:

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The empty tomb, not the cross

…is the most significant symbol of the Christian faith.  The cross is where Christ took our place, judged and condemned for our sins.  The pivotal moment, that.  But the empty tomb proved he wasn’t just a madman on a fool’s errand with delusions of grandeur.  Christ claimed to be the Son of God, equal to the Father.  Thus, as C.S. Lewis famously wrote, there are only three ways to respond to Him: call Him a liar, call Him a lunatic, or call Him Lord.  Eternity hinges on which one you choose.

And if Christ has not been raised, then our preaching is in vain and your faith is in vain. We are even found to be misrepresenting God, because we testified about God that he raised Christ, whom he did not raise if it is true that the dead are not raised. For if the dead are not raised, not even Christ has been raised. And if Christ has not been raised, your faith is futile and you are still in your sins. Then those also who have fallen asleep in Christ have perished.

If in Christ we have hope in this life only, we are of all people most to be pitied.

But in fact Christ has been raised from the dead, the firstfruits of those who have fallen asleep. For as by a man came death, by a man has come also the resurrection of the dead. For as in Adam all die, so also in Christ shall all be made alive.

1 Corinthians 15:14-22

He is risen!  He is risen indeed!

Save up all your tears

Shocked at Trump’s intention of giving Sanctuary cities exactly what they say they want — more illegal immigrants — Cher cries “what about Americans?”

Cher Tweet

I particularly liked the “(Many are VETS)” part, given current trends:

Democrats in Albany may be having second thoughts about blocking a bill that would help children of injured or fallen veterans go to college…

The committee instead approved $27 million in tuition assistance to so-called “dreamers” – students brought to the country by their parents illegally when they were children.

“Taxpayer money for free college for illegal immigrants… yet struck down a bill that provides free college tuition to gold star families. Absolutely wrong and insulting,” Assemblyman Michael Lipetri of Long Island’s 9th District added.

That a leftist like Cher is suddenly tweeting like a “deplorable” shows how effective Trump is at twisting them like a pretzel around their own politics.  It’s my fervent hope that undecided and independent Americans are looking at the Democrats’ reactions to his proposal to send illegals to “sanctuary” cities and asking “so wait… then why is it OK to inflict that on everyone else?”

We don’t need to just reelect Trump in 2020.  We need to give him a Congress fully prepared to support him.

A one-way ticket

Democrats must be concerned about internal polling indicating Trump’s policy successes are pulling away minority votes:

Democratic New Jersey Sen. Cory Booker introduced a bill Monday that would establish a commission to study the impact of slavery on the black community and propose slavery reparations initiatives.

Sen. Booker tweeted in reference to the bill he will be backing in the Senate, saying, “I am proud to introduce legislation that will finally address many of our country’s policies—rooted in a history of slavery and white supremacy—that continue to erode Black communities, perpetuate racism and implicit bias, and widen the racial wealth gap.”

Senator Spartacus” obviously doesn’t see the irony inherent in a Black U.S. Senator complaining that blacks just can’t get ahead in this country, less than three years after a Black man left the Oval Office.  That said, let’s examine his complaint:

Few things “erode Black communities” like the twin scourges of welfare and abortion. Both are practically sacraments to leftists.  And both have devastated the nuclear family, which study after study shows is vital to social and economic mobility.  The advocacy of abortion in America, in particular, has demonstrably racist origins.  As for the welfare legacy of the Great Society, let’s review the thoughts of its architect, Democratic President Lyndon Johnson:

These Negroes, they’re getting pretty uppity these days and that’s a problem for us since they’ve got something now they never had before, the political pull to back up their uppityness. Now we’ve got to do something about this, we’ve got to give them a little something, just enough to quiet them down, not enough to make a difference.

No amount of monetary compensation can undo the damage that two generations of government paternalism has caused the Black community.  Only by leaving Uncle Sam’s plantation and its slave mentality of perpetual victimhood, and taking personal ownership of their community’s fate, is there any chance for improvement.  (The same is true for all Americans, not just Blacks.)  Reparations are the exact opposite of that.  It’s “enough to quiet them down, not enough to make a difference.”  Of course, it’s good for buying votes, though, which is the real point.

At the same time, reparations represent an injustice to the rest of Americans.  Inevitably, it will open the door for demands by the Native Americans, Hawaiians, the Chinese and others, each with their own legitimate historical grievances.  The fabric of our society will become even more frayed as each group jostles for its share of the loot.

And where will that loot come from?  Largely from the White Devils, of course.  After all, we pale skins are the root of all evil — our college professors told us so.  Sarcasm aside, I’m the first in my family history ever to go to college.  My ancestors were hardscrabble, not wealthy, and none ever owned slaves, even though they were eeeeeeeevil Southerners.  It wasn’t my white skin that got me through college.  It was my parents ensuring I made use of my high school education, and instilling the work ethic that allowed me to work and go to school at the same time.  If he had any sense, Spartacus would see why I’m less than enthused at the prospect of being taxed to pay for others’ historical sins.  Apparently to the Democrats, I’m a “deplorable,” a “bitter clinger,” and a cash cow for redistribution schemes.  I wonder why they’re having a hard time connecting with my demographic these days.

We need a different vision if this country is to survive, a century and a half after it nearly tore itself apart.  (Today, by the way, is the anniversary of the effective end of that cataclysm.)  I’m reminded of a line from the movie Kingdom of Heaven:

“We fight over an offense we did not give against those who were not alive to be offended.”

We are at a crossroads.  Either we acknowledge our shared history — good and bad — has led all Americans to where we are now, which is a place of privilege beyond compare to most of the world’s population.  Or we begin fighting over the scraps of that heritage, and in the process tear apart what remains of it.  We can no longer afford would-be leaders who use grievance-mongering for personal advancement (I’m looking at you, Southern Poverty Law Center).

Which is why I’ll say this: there is one form of reparation I would support, and one only.  The original offense of the slavers was to forcefully remove Africans from their home and transport them to the Americas.  If any slave’s descendants truly believe this country is irreparably unjust to them, I support funding a one-way ticket to whatever African country they choose.  I don’t expect a mad clamor to take up such an offer, however.  Anyone with eyes can see that even the poorest of families in the most violent of Democratic-run cities like Chicago or Baltimore still has more opportunity and more to be thankful for than the vast majority of their distant relatives overseas.  Deep down, Senator Spartacus and his ilk know it.

And that, I submit, is reparations enough.  If it isn’t, by all means book the flight, bill Uncle Sam, and leave your U.S. passport on the way out the door.