- RBA Governor Philip Lowe says “privately issued and backed money all too
often ends in financial instability and losses for consumers”
- Dr Lowe welcomes the federal government’s move to introduce new financial regulation
By David Ditch ~
Talk about a ludicrous advertising pitch! Speaking of the record-breaking tax-and-spend package currently being pushed through Congress, President Joe Biden last Friday said, “It is zero price tag on the debt. We’re going to pay for everything we spend.”
This is flatly wrong, and it isn’t even close.
While we don’t yet have a full accounting of the 2,465-page behemoth, it’s expected that the bill’s total amount of spending and tax credits will reach $3.5 trillion.
In contrast, the bill would increase taxes by about $2.3 trillion, leaving a gap of over $1 trillion. Democrats claim that the difference would be made up by imposing price controls on prescription drugs and through hoped-for economic growth—even though independent analysis says the bill would actually depress growth.
Yet rather than correct the record, Biden doubled down and then some.
In a tweet last Saturday, he said, “My Build Back Better Agenda costs zero dollars.”
It’s one thing to incorrectly claim that legislation pays for itself. It’s another thing to claim that possibly the most expensive piece of legislationin world history has no cost whatsoever.
Make no mistake: There is no free money. Every dollar the federal government spends must either be taken from taxpayers or borrowed.
Extra borrowing would be irresponsible. The federal debt currently stands at $28.4 trillion, or about $220,000 for every household in the country.
The problem is only getting worse, with tens of trillions in unfunded liabilities for programs like Social Security and Medicare. That’s bad for retirees and future generations alike, and Congress is refusing to address the coming crisis.
Tax hikes also have a real cost, and not just for high-income individuals.
Despite Biden’s promises that his plan wouldn’t increase taxes on people earning less than $400,000 per year, the official congressional scorekeepers show the tax burden will increase for families bringing home as little as $30,000 per year.
As for economic growth, a higher tax burden would kneecap the competitiveness of American businesses against foreign competitors. It would also discourage the private sector investment that creates jobs and drives wage growth for workers.
With the post-pandemic recovery still on shaky ground, this is an especially bad time to increase the tax load.
Unfortunately, Biden’s absurd talking point of a “zero dollar” cost is spreading. From Rep. Pramila Jayapal, D-Wash., head of the House Progressive Caucus, to mainstream media headlines about “zero” cost, there is now an active campaign to pretend that a radical big government agenda is free.
Since “trillion” is a nearly incomprehensible number, it’s vital to understand what the bill’s $3.5 trillion price tagactually means.
*The amount drained from the private sector works out to over $27,000 per U.S. household, which is more than the cost of five years of groceries for a typical family.
*Spending at $1,000 per second, it would take 111 years to reach $3.5 trillion. Yet because the bill would cram that spending into a single decade, it would spend an average of $11,000 per second for 10 years.
*At the time it was passed, [the Affordable Care Act] was one of the most expensive pieces of legislation ever. Adjusted for inflation, it cost $1.1 trillion—less than one-third the size of Biden’s tax-apalooza. Even the most ardent supporters of Obamacare never claimed it had a “zero” cost.
Concerns about the legislation go well beyond its incredible cost. The way those trillions would be spent is also riddled with problems.
Expanding the welfare state would discourage work for low- and middle-class families, creating dependency on government rather than creating wealth.
Doling out hundreds of billions to “green” businesses would have no measurable effect on global temperatures, but it would create a new left-wing political constituency using taxpayer dollars.
Democrats are also determined to try and force mass amnesty for illegal immigrants into the tax-and-spend bill.
At the end of the day, this legislation would further concentrate power and control in Washington, D.C. The idea that Congress and federal bureaucrats deserve more responsibility over our day-to-day lives should be a punchline regardless of one’s political leaning, yet that is exactly what the bill would do.
Instead of railroading through a piece of legislation that’s longer than the combined length of two King James Bibles, Congress ought to slow down and consider alternatives.
Reforms to already-existing benefit programs can encourage work and reduce long-term deficits. Maintaining a pro-growth tax code would do more for jobs and wages than any amount of federal meddling.
Taking a responsible approach to the nation’s finances would be a welcome surprise. Unfortunately, Biden seems intent on pretending that everything he wants is free.
He’s wrong. And if the legislative package passes, America will pay a very real price.
This article originally appeared in Fox News.
Comment by tonytran2015: Compulsory superannuation in Australia has created rip-off, fraudulent markets for Superannuation Fund Managers. The financial illiterate, forced contributors lose heavily.
A court has found that the Commonwealth Bank-owned investment firm
Colonial First State (CFS) misled and deceived superannuation customers
to keep them in a higher fee fund.
In a case brought by the corporate regulator, the Federal Court ruled the trustees of CFS’s First Choice fund were liable for encouraging members of the
fund to remain rather than move to a cheaper MySuper product, a low-fee
product required by law.
And yet, the primary objective of any government is to increase its size and power as rapidly as the populace will tolerate it. The only reason that they rarely do this quickly, is that they can’t get away with it. Like boiling a frog, it takes time to lull the populace into submission, bit by bit.
And, in order to make sure that the public do not figure out what’s been done to them, the news reporting becomes Orwellian in its endless repetition of a false narrative.
It is, however, true that, “You can’t fool all of the people all of the time.” Eventually, the Band-Aid peels back to reveal an infection that’s far beyond what had been generally perceived. It then falls away in layers, as increasing numbers of people become aware that they’ve been scammed – that the media is entirely corrupt and that the media’s owners – big business – have, with the enthusiastic compliance of the government, robbed them on a wholesale basis.
by Jeff Thomas
Well, that sounds reasonable… even beneficial. But, unfortunately, that’s not really the whole story.
When QE was implemented, the purchasing power was weak and both government and personal debt had become so great that further borrowing would not solve the problem; it would only postpone it and, in the end, exacerbate it. Effectively, QE is not a solution to an economic problem, it’s a bonus of epic proportions, given to banks by governments, at the expense of the taxpayer.
But, of course, we shouldn’t be surprised that governments have passed off a massive redistribution of wealth from the taxpayer to their pals in the banking sector with such clever terms. Governments of today have become extremely adept at creating euphemisms for their misdeeds in order to pull the wool over the eyes of the populace.
At this point, we cannot turn on the daily news without being fed a full meal of carefully- worded mumbo jumbo, designed to further overwhelm whatever small voices of truth may be out there.
Let’s put this in perspective for a moment.
For millennia, political leaders have been in the practice of altering, confusing and even obliterating the truth, when possible. And it’s probably safe to say that, for as long as there have been media, there have been political leaders doing their best to control them.
But we’re not in that ideal world. We are forced to participate in a Ponzi Scheme known as Social Security.
By the way, that’s not necessarily a disparaging description. A Ponzi Scheme can work if there are always enough new people in the system to pay off the old people.
And this is why Social Security faces serious long-run problems.
How serious? The Social Security Administration finally released the annual Trustees Report. This document has a wealth of data on the program’s financial condition, and Table VI.G9 is where the rubber meets the road.
As you can see from this chart, there will be an ever-increasing burden of Social Security taxes and spending over the next 75 years. And these numbers are adjusted for inflation!
The good news (relatively speaking) is that the economy also will be growing over the next 75 years, both in nominal terms and inflation-adjusted terms.
The bad news is that spending on Social Security will grow at a faster rate, so the program will consume a larger share of the economy’s output.
Comment by tonytran2015: Compulsory Superannuation in Australia benefits the financial companies managing Superannuation Funds more than the workers contributing to the funds with 9.5% of their salaries. It is an institutionalized scam targeting the financially illiterate workers.
A key area the PC [Productivity Commission of Australia] did focus on in its report, was the fact that Australians pay over $30 billion a year in fees on their super
(excluding insurance premiums).
[$30 billion a year is excessive for a national total population of 25 million, including non-working and children].
A report released by the Grattan Institute last year
noted that reducing average super fees, and increasing investment
returns, by channelling people into the better performing superannuation funds, would also boost retirement incomes by more than raising the
Super Guarantee to 12 per cent [from currently 9.5 per cent].
Finiko, established in the southern city of Kazan in 2019, promised investors returns of 20-30% per month, as well as the opportunity to purchase apartments and cars at discount prifounded by four men, with Kirill Doronin, a charismatic Instagram influencer with a history of running pyramid schemes, acting as the face and spokesman of the group.
Authorities first took note of Finiko after it released its own cryptocurrency, FNK, on Dec. 1 2020, which appeared on cryptocurrency exchanges…
… Our leaders created, borrowed and spent trillions upon trillions of dollars in a desperate attempt to get our economy back on track, and it turns out that all of that money didn’t really have the enormous impact that they had hoped. On the other hand, inflation is now beginning to spiral out of control, and many are comparing this time in our history to the Jimmy Carter era of the 1970s.
In this article, I would like to compare the state of the economy today to the state of the economy just before the pandemic started sweeping across the country.
As you will see, it appears that a tremendous amount of long-term damage has been done…
An ABC investigation unravels how the former MP did favours for Mr Liu’s
company, which allegedly swindled vast sums from Australians and became
embroiled in a devastating international fraud…
Comment by tonyttan2015: A chilling story of real life tullip mania got taken over by the underworld.
…the US Department of Justice claims to have evidence of a link between
Dr Ruja’s brother and “significant players in Eastern European organised crime”.