Less Gifts and More Christmas

This time of year I find the mind numbing barrage from stuff peddlers rushing to fill my every need overwhelming. Needs both real and imagined, I'm even asked to reach out and consider, and speculate, on the needs and desires that others might have. Peoples lives are crammed with material goods, our drawers and closets are chucked full of the trendy apparel of last season, exercise equipment, knick- knacks, and electronic equipment, until they threaten to explode unless they move to a larger house or rent a storage unit.  Neurotic people with over active pack-rat syndrome literally destroy their quality of life with clutter and junk that sits in one place for years while they can’t find a chair to sit in or a clean table top on which to eat. 
   
Ads like - "get it all" or "have it all" with Dell, live on the cutting edge, buy all of these high powered models and "put your life in the zone." This new fangled electronic gizmo does it all and more, look at the art work, let it wash over you, surround you, and cover you up.  Check out that car, is it not perfect?  Wouldn’t driving it make life a zen like experience - got to have it, no payment for 90 days.

We get caught up in the game of finding the perfect patio furniture and after we buy it we use it twice. It then sits on our deck only to fade in the sun over the next three years.  Never before has man had so much, but its far from enough.  Things will be “swell and down right peachy” only after you fill it with the right kind of stuff. Then your life will be nearly perfect in every way till . . . . .  No, the new model’s here, and its better, sleeker and cheaper, Nooooooooo!

Great are the efforts we make to fill our needs with material objects in an effort to achieve happiness. We rush around with our video and digital cameras in a desire to preserve those precious moments.  We capture so many images that we forget to download, view and print them.  We now have the ability to collect and store vast quantities of information and data, much of which is never processed or utilized.  Poor quality or obsolete data entered into our system downgrades the output, "garbage in - garbage out."  
  
What is real?  The Sunday paper weighs ten pounds, the ads, the ads, the ads.  What store is that?  Never heard of it?  They are all the same, junk, junk, junk, buy me some happiness!! It is only natural to be drawn to nice things but new is merely a point in time, and not a reflection on quality or utility value. We have so much junk we can’t find the item we need or want, so we are forced to buy a replacement until we find where it was placed.  You know it’s true  – yes, you are guilty, so are we all.

We have even been convinced that we should not leave our house or office without a bottle of water, if it were not for bottled water, we would all be dead.  Bottled water was a two hundred billion dollar industry last year.  Oh, how our needs have grown.  Well, all I really need is a lamp, an ashtray and well maybe a yogurt maker.  That’ all I need!  Using a line by the song writer-singer Jimmy Buffet, I want to go where the women and water are free.


PART OF THIS POST WAS LIFTED FROM MY BOOK "ADVANCING TIME". If you glance over at the archives over the months you will see other post concerning social commentary, sustainability,  or the environment.

Lotto Madness

The  "Lotto Madness" that has swept across America reveals something about our culture. While this might not reach the level of needing a post event "debriefing" a closer look at how these large lotteries effect our culture may be important. A close inspection of how people react to the idea of winning a large sum of money exposes more then a few flaws in our values and the way we think. It seems that we reached the point where the road to riches is not through the valley of hard work and savings and that we by-pass the important area known as sacrifice.

This has even influenced television shows like the animated comedy "Family Guy" where in a recent episode the family finds themselves living on a strict budget until a local news story on the lottery influences Peter to buy a ticket in hopes that he will win and set the family on a better financial platform. Peter reveals to his family that he has bought several thousand lottery tickets, admitting that he has taken out a second mortgage on the house in order to buy them. After watching the results of the lottery that night, they discover that they have indeed won it yes, they have obtained the American dream.

When weekly periodicals are placed as inserts in Sundays papers across the nation with front page revelations of comparison incomes comparing salaries.  An athlete making $15,900,000 a year, next to a government employee making $130,000, a CEO at $120,000,000 a year, and a business owner at $24,000 dollars a year causes pause.  No wonder we as a society are totally screwed up.  We must question our values, we must question the fairness.  It is hard to measure the discontent generated by irresponsible articles like these.

 Many people feel the trade offs we face in life within our free market-consumer based society. The fact is economic growth is accompanied  by  “wheel spinning”, inefficiencies and waste.  While the benefits of our system often outweigh the negatives we find society is paying a toll through increased rates of addiction, depression and economic inequality.  On the emotional side many people are not achieving the degree of being content or happy they had hoped for and are left with feelings of insecurity.

Government sanctioned gambling and especially lotteries send a message to the populace that conflicts with many important values.  These messages promote a "let it roll" mentality.  Simply allowing such activities and promoting them are two different issues.  Government has climbed into bed with the devil to gain revenue from taxing these activities.  Gaming does not benefit the average man.  Truth is the laws of nature and the odds are against you, that’s why they call it gambling and not winning.

Huge sums of money from lotteries are unmanageable by the average man and often cause adjustment difficulties, resulting in pain and not happiness.  Large jackpots also result in a disconnect in true and associated values causing unrealistic expectations.  Thoughts that jackpots in excess of one hundred million dollars can be ours gives a false impression of reality that is harmful in cultivating positive work ethics and makes a mockery of those who toil to produce a better life.

Our modern consumer based society has made us slaves to material objects and producers of waste.  Many economist urge us to consume, even when we must borrow to do so, saying it creates ever more jobs. We follow Governments and leaders that we often neither like nor trust.  Today’s youth growing up besieged by marketers, are now vilified for being materialistic, marred by too little perspective, they find themselves angry and disappointed. During the latest lotto that sported a massive well publicized jackpot people used money that was intended to be used to pay rent and even the food stamp money given to them by tax payers to buy tickets. This is indeed madness.

Dividend and Capital Gains Tax

The special breaks and deduction that make up Americas tax code are massively confusing. Most people are totally ignorant of tax law and  have no idea what they are talking about when they express an opinion on what policy changes should be made,or how they will effect the economy. In 2003, President Bush proposed to eliminate the U.S. dividend tax saying that "double taxation is bad for our economy and falls especially hard on retired people", this is questionable. He also argued that while "it's fair to tax a company's profits, it's not fair to double-tax by taxing the shareholder on the same profits." This formed the bases for the following tax table.

Dividend Taxation in the United States since 2003

2003–2007			2008–2012			2013 -
Ordinary Income Tax Rate	Ordinary Dividend Tax Rate	Qualified Dividend Tax Rate	Ordinary Income Tax Rate	Ordinary Dividend Tax Rate	Qualified Dividend Tax Rate	Ordinary Income Tax Rate	Ordinary Dividend Tax Rate	Qualified Dividend Tax Rate
10%	10%	5%	10%	10%	0%	15%	15%	15%
15%	15%	5%	15%	15%	0%	28%	28%	28%
25%	25%	15%	25%	25%	15%	31%	31%	31%
28%	28%	15%	28%	28%	15%	36%	36%	36%
33%	33%	15%	33%	33%	15%	39.6%	39.6%	39.6%
35%	35%	15%	35%	35%	15%

Soon after, Congress passed the Jobs and Growth Tax Relief Reconciliation Act of 2003, "JGTRRA"), which included some of the cuts Bush requested and he signed into law on May 28, 2003. Under the new law most dividends are taxed at the same rate as long-term capital gains, which is 15 percent for most individual taxpayers. Qualified dividends received by individuals in the lower 10% and 15% income tax brackets taxed at 5% from 2003 to 2007. The qualified dividend tax rate was set to expire December 31, 2008; however, a tax bill in 2005 extended the lower tax rate through 2010 and further cut the tax rate on qualified dividends to 0% for individuals in the 10% and 15% income tax brackets. In December of 2010, President Obama signed into law the Tax Relief, Unemployment Insurance Re-authorization and Job Creation Act of 2010. The legislation extends for two additional years the changes enacted to the taxation of dividends in these laws.

What happens to the tax rate on dividends will have more effect on high income earners that receive this type of income then the tax rates now being debated. Other tax issues of major importance have been placed on the back burner but must be addressed, these include the Inheritance Tax, and the Minimum Alternative Tax. With only thirty present of taxpayers itemizing deductions the explosive implications of capping certain deductions  will soon resurface as will several tax credits that cost the government revenue. This needed debate will go on for a long time.

Nothing Has Changed In The Economy

Economically speaking the numbers out this morning would lead any sane person to say, "nothing has changed on the ground" even after central banks have dumped trillions of dollars into the system. Much like in 2007 when the markets ignored reality, the markets are generally moving upward on the bad news, the following article by Gregg Robb was placed on Market Watch following the release of the data: 

WASHINGTON (MarketWatch) - The Empire State manufacturing index remained in negative territory for the fifth month in a row, the New York Federal Reserve Bank said Monday. The index fell to negative 8.1 in December from negative 5.2 in November. Readings below zero indicate a decline in activity. Economists polled by MarketWatch expected the index to return to positive territory near 5.2. Details of the report were also weak. The key new orders sub-index fell below zero after returning to positive territory in November and shipments also retreated.


Another article went on to explain that investors are shrugging off economic data to focus instead on budget negotiations in Washington which appeared to make some progress over the weekend. When will people realize that nothing has changed? Like a boat on the ocean the economy is riding the wave of deficit spending.

A Foot Note, added January 9th; A headline like the one this morning, should give one pause, "floundering food stamp growth will hurt grocers".

 

What is the definition of "IS"?

When it comes to the way many media host conduct their interviews on the Sunday morning talk shows the spin is incredible. The host often loads the question then bends the answer. Bias moderators who lead talk shows concerning important topics in America and Washington ask a question then interject their opinions and ideas right over the top of the guest answers. It is not uncommon to hear questions asked that can't be answered or the answers have nothing to do with the question. I'm reminded of the infamous response Bill Clinton gave to a question during an interview, "it all depends on your definition of is."

As an example imagine a host allowing the following answer from a man with a history of violence that was recently released from prison to the following question. Have you stopped beating your wife? The convict would say: "That depends on your definition of beating. I may rough her up a little now and then, you know, back hand her across the mouth or kick her, but no I don't beat her anymore." I suppose if when you use the term "beat", you mean with an object like a pipe or stick, the answer would be, yes this man has reformed.

When trying to interpret the information we garner from these shows we should ask, does the host have an agenda? Till the American people and the networks begin to demand more fair and balanced information and fact finding do not expect the quality of these shows to improve. A sad commentary on the pace of modern life is that we have little time to reflect and correct problems like these. When it comes to an event that moves us emotionally we vow to remember it forever but within a few hours it becomes lost in the chaos of everyday life. Do not expect the media to improve or change any time soon.


Footnote; If you can handle a stronger rant on the clowns of media and the so called experts, please view the posts below,
                         http://brucewilds.blogspot.com/2013/05/scandal-upon-scandal-upon-scandal.html                          http://brucewilds.blogspot.com/2012/03/you-dont-know-that.html

Government Includes Quasi Government Ventures

The role of the government in America is changing on federal, state and local levels.  Mandates often unfunded are fostered upon business organizations and private citizens. If unchecked government grows - it is the nature of bureaucracy to expand.  The use of sun-set legislation is underused or the bar set too low when it comes to extending and renewing government bodies. Politicians and bureaucrats deterred from expanding or funding programs by a few vigilant citizens, wait and find creative ways to reach their objective at a later date.  Creating special bonds, attaching fees to needed services or narrow taxes that go on to fund new authorities, commissions, and districts.

The government need not be efficient, we see this in issues small and large, for example in our currency. Not only is the penny still being used, four new versions of it were released in 2009.  The penny is totally antiquated and illogical if an employee is paid only $12.00 per hour it cost twenty cents per minute.  How can businesses afford to pay that employee to count and handle pennies when the labor exceeds its value?  According to the “citizens to retire the penny” it cost the Country more than $15 Billion Dollars annually, but to the government that matters naught.

The Government hurls money at inefficient programs to assist the poor.  Government has spent a fortune in housing for low-income people offering low prices to the applicants, they compete with private enterprise but due to subsidizes are able to “cherry pick” those that will be good residents, rejecting to the streets the more troubled.  They ignore that this is is in conflict with their mission of helping the most needy.  Food stamps do not limit the user to economical healthy basic foods but allow even a recipient to pick up steak and lobster that they can give to friends and family at Christmas, a blind eye is turned towards this glaring flaw.
   
I often sit and have coffee in a chair near the front window in the building where my office is located, this window looks out on what might be called the crossroads of America.  Across the street is a Target store that was recently expanded into a super-target, behind it a toxic waste site cleaned up to where it may be used in a limited way.  A bank on the corner, built eight years ago after demolishing the preexisting buildings, has changed its name five times through acquisitions.  Miscellaneous stores and offices line the street, coming and going, with all for lease signs that accompany such a changing landscape.


Unneeded quasi-government organizations by nature reach out to expand the influence and power of their directors. Instead of focusing on the business of government and simplicity, this new proactive movement, one of "cuteness", disguised in the shawl of flexible and diversity is being expanded, and we are paying the tab.  Government is proud of pet projects, it allows bureaucrats to experiment and try new things without the personal financial risk forced upon those in business, they are creative and tinkering on our dime and this is a problem for concern. The best time to kill a monster is while its still small, that time has passed, now we can only hope to slow its growth through starvation, and that is unlikely.


Footnote; this dovetails with a post on February 6th, 2012 titled The Assault of Growing Government, it can be accessed at
                    http://brucewilds.blogspot.com/2012/02/assualt-of-growing-government.html

Taxation Discourages Savings

    No where are laws and legislation a stronger form of social engineering then when it involves the economy and taxation. Tax incentives and the fuzzy math that surrounds our complicated tax system often clouds the issues. Its often not how much money is spent but rather how the money is spent that determines the value of an investment. One obvious place this plays out is in savings, by taxing interest of a simple savings account the government makes the act a far less compelling investment.

    America’s lack of savings is repeatedly pointed to as a problem, yet laws, that tax  interest  make small savings accounts a non-starter when coupled with the factors of  inflation and bank fees. For a long time  I’ve promoted a program that makes the first Two Hundred Dollars of interest from a savings account non-taxable as a way to encourage savings.  At a four percent interest rate it would allow for the interest on a five thousand dollar savings account not to be taxed, currently rates are paying a much lower rate.

    This change would create a more positive savings environment for those most likely to need a safety net from job layoffs, auto repairs, illness, and other misfortunes.  Cost to the Federal Government if the holder of such an account were in the twenty percent tax bracket would be Forty Dollars per year.  This is far less costly than the assistance programs we must put in effect to help when bad things happen to those with no buffer or savings and their financial house then collapses.

    Considering all the complex tax laws and legislation Congress enacts this would be one of the simplest to write and enact.  This is an easy to implement alternative to complex schemes like former President Bush’s Social Security Reform and ownership society plans.  That plan and many others would create huge administrative problems further adding to Governments growth and intrusion into our lives. Something that encourages middle and lower income Americans to save should be built into and tax reform legislation put forth.


Footnote;  The special breaks and deduction that make up Americas tax code are massively confusing. Most people are totally ignorant of tax law and  have no idea what they are talking about when they express an opinion on what policy changes should be made,or how they will effect the economy. More on the subject of taxation below,
                http://brucewilds.blogspot.com/2012/12/dividend-and-capital-gains-tax.html