Stephen Moore: We've Become a Nation of Takers, Not Makers - WSJ.com
Stephen Moore wrote a great article in the Wall Street Journal on April 1, 2011 about how America has went from being a producer of goods (manufacturing) to a nation of takers. He was talking about the plight of most state governments with the exception of Wisconsin and Indiana, who have more government workers on their payroll than people manufacturing industrial goods. This is a travesty! You wonder why states such as California are broke. There's not sufficient industrial jobs to provide enough taxable revenue to pay for all the expenses of the states' governments across America. No state government can afford to pay its employees and fund their healthcare and pension benefits when it employs more government workers than those who work in the private sector. Taxable receipts come from private sector jobs. The creation of wealth comes from the private sector; not the government. Government doesn't produce or manufacture anything. Government pays its workers by taxing the citizens of that respective state. That money has to come from somewhere. Government can't create money. The Federal Reserve prints paper out of fiat, which is worthless and will eventually cause other countries to stop using our dollars.
After reading this particular article, I was debating which direction to head with this post. I at first thought about titling this post, "America's Need for a Manufacturing Base." We definitely need to restore our manufacturing base. There was a time in this country's history that America was the most industrialized country in the world. Consequently due to trade agreements such as NAFTA in 1994 and CAFTA in 2005, millions of manufacturing jobs have went to Mexico where huge corporations can pay much cheaper wages. There are other reasons why many manufacturing jobs have been exported from America such as the onerous regulations the government place upon businesses today. Many of these regulations make it financially costly for businesses to soundly operate. Am I insinuating there should be no regulation or oversight on business whatsoever? No. I believe there should be laws against fraud and abuse in the business world. However, there are some mandates that government places upon business that make it difficult for that particular business to financially operate. We need manufacturing. There was a time we were the most self-reliant nation in the country. Today, we're dependent upon China for our steel or technology. That could be very dangerous during a time of war. America has the resources to be independent from all other countries. It's due to the agenda of the globalists that desire to destroy the sovereignty of the U.S. to bring about a one-world government is why such insane policies by government are happening. The government needs to allow businesses room to explore, create, innovate, and grow. Government has no business micromanaging the affairs of the business world.
For the last few years the Democratic Party and liberal members of the media have been repeatedly making the case that there needs to be tax hikes on the rich with income levels around a million dollars or above. The Democrats are trying to hoodwink the American people and make them believe the ballooning deficit that occurred during both the Bush and Obama administrations are due to the Bush tax cuts of 2001 & 2003. Nothing could be further from the truth. I listen sometimes to Alan Colmes, who has a three-hour radio program in a local radio station in my hometown. Colmes, who was co-host of Hannity & Colmes on Fox News from 1996-2009, has repeatedly made the case that we couldn't afford the Bush tax cuts and that the rich need to made to pay more of their share in taxes. Colmes, who is syndicated by Fox Radio, believes in a progressive income tax structure which I severely disagree with. I've heard him mention that the federal tax rates are the lowest since Harry Truman was president. I have some news for him: There aren't enough rich people in this country to generate the revenue needed to lower the deficit and fund all the federal government's programs. Those that are super rich have Congress and the President in the palm of their hands. The super rich have enough wealth to buy-off our politicians. President Obama isn't going to force George Soros or David Rockefeller to pay their fair share of taxes. I assure you that. All this talk about the rich paying their fair share is a farce. What will happen is the middle class will be affected by tax hikes on the rich. The rich will pass of the costs of their business to us, which consists of the lower middle class and below. The middle class will be the ones hurt on tax hikes for the rich. The rich knows how to manipulate our politicians.
There are two problems I see in this equation. The first and most important is the government is out-of-control when it comes to spending. They don't care. They want to raise taxes so they can have more money to spend. They're not about controlling spending and reducing the deficit. This is all political theater (Democrats and Republicans). Presently President Obama and Congress are trying to forge some deal to raise the debt ceiling (according to my opinion). Congress has until August 2nd to make a deal whether or not to raise the debt ceiling or keep spending levels as they are. President Obama recently golfed with House Speaker John Boehner (R-OH), Vice President Joe Biden, and Ohio Governor John Kasich (R-OH). I guarantee you the President and Speaker Boehner were trying to find a way to compromise on the issue of raising the debt ceiling. Some Republicans are trying to give the pretense that they are opposed to raising the debt ceiling. What I expect to happen is the Republican leadership will compromise and make a deal where the debt ceiling will be raised in exchange for "substantial spending cuts". I guarantee you there won't be any significant cuts if there are cuts at all. I believe the Republicans will vote to raise the debt ceiling. I know the Democrats will vote for it. We need to place much pressure on the Republicans to hold up to their end of the bargain and vote "no" on raising the debt ceiling.
As I've just mentioned, federal spending needs to be reined in. However, there's another problem and that is a lack of government revenue. Given the fact we're over 14 trillion in debt, we need new taxable revenues. Back in 2009 when this blog first began, I wrote a post about Congress's attempt to pass a national healthcare bill. One of the objections I had to the eventual Afffordable Health Care Act of 2010 was the fact many Americans were out of work and as a result there wasn't enough taxable revenue to cover the expensive costs of what would soon be termed "Obamacare." As I've stated at the outset of this post, government doesn't create wealth. The answer isn't to tax away the wealth of the rich in America. There aren't enough rich people to place a dent in the deficit. It irks me when I heard Democratic politicians trying to promote the idea of taxing the rich. There's no debate that we need more taxable revenue going into govenrment. However, the way to increase taxable revenue is for the private sector to recover and create new jobs once again. President Obama always gives lip service when it comes to job creation. He's about big, socialist government. Recently he's been focusing on creating jobs. The problem is the only kind of jobs that governemnt can create are government jobs and the money to fund those positions come from taxpayers. The only way never revenue will be created is for the government to remove all the regulations that hinder businesses from hiring people. Businesses need room to survive. You can't mandate policies upon businesses which would make it difficult to hire new people or to be able to grow. Government needs to allow the private sector to develop into the potential it has. The American economy has a lot of potential if the federal government will stop micromanaging businesses.
Why aren't the liberal politicians and pundits saying what I just mentioned? What don't they seem to recognize that wealth is created in the private sector? New sources of revenue will come when the private sector rebounds and adds more jobs to this country. Only the private sector can create wealth. Government has to tax its citizens to pay for every new job it creates in the public sector. Government is broke because fewer and fewer people are working private sector jobs which produce more revenue to the government. America can no longer afford a disproportionate number of people working in the public sector vs. the private sector. Illinois and California are broke partially because too many of its citizens no longer have private sector jobs. The funding of government is impossible unless private enterprise creates the wealth which will be used to fund the operation of government. That's something liberals and Progressives don't seem to understand. They seem to think taxing the rich is the answer. They believe the government is the Saviour of our world. No, taxing the rich isn't going to reduce federal spending. The answer is for the creation of more private sector jobs so more revenue can be collected for the operation of government.
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