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El Greco

There has been constant conjecture that Barack Obama was born outside of the United States and is therefore unqualified to be president.  Most say he was born in Kenya, the homeland of his father.  Some have even opined that he was born in Indonesia.  This has all made headlines and has provided fodder for pundits and bloggers everywhere.

Now we get information that indicates that those theories may be all wrong and that, in fact, Mr. Obama may have been born in Greece.  Let me explain.  The following piece by Karen Guthrie (  http://www.wildriverreview.com/young/?p=823  )  will serve as background:

I believe that the financial meltdown in Greece transcends economics. It goes to the very heart of a society. I lived in Athens for two years, from July 2007 until July 2009, and observed a culture that believes all rules are made to be broken. Once broken, there are no consequences. A mindset of not just “me first”, but “me only”, prevails in the homes, on the streets, and within the office buildings. I saw the meltdown coming because it was incomprehensible to me that this type of society could go on without a crash.

I watched parents beam with pride when their 12-year-old children decide to occupy their school, keeping teachers and administrators at bay for a week because the young people do not like the snack selection.

I saw a community capable of living in its own filth. Greek homemakers tackle the cleaning of their black-dust-covered home as if it were an Olympic sport. Yet on the sidewalk outside of their front door, all types of foulness could, and would, collect. Translation: My house is clean, why should I worry about what is on the street”

I saw near anarchy on the streets of Athens as drivers dangerously intimidated all in their path. Sidewalks are considered extensions of the road. Simply walking to the grocery store required vigilance or a death wish. Translation: If I want to drive on the sidewalk, why shouldn’t I?

Civil servants have jobs for life. Therefore, the need to be competent, responsible and courteous is no longer apparent. The rudeness I experienced time and again in my local post office made me quake in my shoes and long to be anywhere else.

I witnessed government money allocated for business stimulus spent by the recipient on the redecorating of his private home. Translation: Me first; me only.

I was a stranger in my Athenian neighbourhood, and a stranger I remained. The universal language of a smile was not readily spoken. Hospitality seems to extend only to friends and family. The Soup Kitchen for Refugees where I volunteered was completely staffed by foreigners living in Athens: Australians, Spaniards, Americans, Canadians, New Zealanders, French, Austrian, German, Italian – a United Nations of volunteers, conspicuously missing Greek representation.

I saw the meltdown coming. I see the rioting in the streets as a tragic outburst from the “me only” heart of a society, a society Europe coveted.”

Mr. Obama shows too many similar traits to the Greeks for it to be coincidence.

For example, “…me only…” is evident almost every time he speaks.  He takes credit for everything good, blames others for everything bad, and uses the word “I” more than any other orator one can name.

Or, “…beam with pride when their 12-year-old children decide to occupy their school…”  Remember how he backed the union thugs who occupied the Wisconsin Capital?  He was proud and supportive of his union brothers and sisters as they broke the law and flaunted it.

 “…Civil servants have jobs for life….”  Look no further than Mr. Obama’s support of the “Employee Free Choice Act” or his constant siding with government employees over the private enterprise and its workers.  Then add to that the increase in government programs and expenses and you see his focus is on the servants, not the served.  An interesting take on Mr. Obama’s need to spend and grow government in the European mold is located here.

 “…the “me only” heart of a society, a society Europe coveted.”  The programs he pushes and his steadfast belief that most citizens need government help indicate he wants a European Style Cradle-to-grave social support system.

If he is not Greek, can someone explain to me why he wants to lead our country to copy the social revolution and culture of “Me first; me only” which has all but destroyed Greece??

My resolutions this year are a bit different than in the past.  I guess I should restate that.  In the past, I have resisted New Year’s Resolutions.  If I am really serious about doing something, I can resolve to do it at any time.  Typical New Year’s Resolutions only last until about mid-February anyway.  The five items below make up a list of things I want to pay more attention to in the coming year.  It is anything but a complete list, but it strikes me as a list of five very significant issues.   I hope to refer to it often and continue to blog about these things more than many of the more superficial issues with which I have dealt in the past.  Here it is:

1.  The Value Added Tax, VAT. I actually think that VAT is a reasonably good idea.  I think it is simpler than our combination of Income, Property, Sales, and Death taxes.  It has a fatal flaw, though.  There is not a chance in the world that it would be enacted to REPLACE those taxes.  Its passage would only mean another layer of tax and more revenue for Congress to abuse.  Tax reform will be a hot topic for the next 22 months and I plan to watch and pay attention more than I would normally.  I predict we will see proposals of a very moderate VAT, like 1% (just like the start of Social Security), and that it will be only a foot in the door.  I will work to oppose any new tax that does not replace a tax that is removed from the current long list.  I predict a VAT will not pass in 2011 but will become a HUGE issue in the 2012 Presidential Election Campaign.

2. The Fed continuing to create money out of thin air. I continue to be very concerned that the mother of all bubbles (greater by a factor of 10 than the housing bubble) is being created right now by a Central Bank that the American People neither understand nor control.  I predict that the Fed will continue to print money to allow our government to operate with few fiscal restraints.  A Trillion dollars of new deficit each of the past two years has been possible only because of your friendly local Fed.   The Fed will also engage in Central Planning of the Banking Industry that will further remove our economy from any stable base (like existed under the gold standard) and will greatly increase the severity of the crash that will be the inevitable outcome of the bubble they are creating.  I predict that these short term measures will continue to prop up politicians and will eventually bring an end to the position of the U.S. Dollar as the standard world trade currency.  I predict that the Fed has the political backing to carry out the sherade for 2011 and possibly even 2012 (until the election), but am convinced that hyper inflation (Jimmy Carter style, at least) will occur within the next 3 years unless we throttle the Fed or return to a gold standard.

3. Virtual Civil War. I don’t see a war like in the 1860s, but I do predict a battle that is every bit as influential in setting the path for the future of our country.  I see wage earners vs. dole takers.  I see Investors vs. politicians/regulators who would tax and spend rather than invest.  I see Private Sector Employees vs. Public Sector Employees.  I see entrenched Keynesians vs. Libertarians and Free Bankers.  What will happen when private sector unions finally discover that public sector unions are driving taxation and deficit spending to the point where they (private sector unions) lose wage parity and the power to control our political direction?  What will happen when Investors come to the realization that the government has in the recent past and will continue in the near future to nationalize businesses and industries?  Unless a concerted effort is made to stop pitting one part of our society against the other for political gain, I fear we will have a virtual Civil War.  It will be between unelected regulators and the people regulated.  It will result in massive non-compliance with taxes, regulations, and law in general.  We can’t build enough prisons to handle a lawless society.  We can’t hire enough enforcement personnel to track down all scofflaws.   I hope for unifying, straight talking leadership but fear we will get more of what we have now, a prescription for the fracture of America.

4. Global Warming. This is a multi-facited problem that is as much about Globalism as about Climate.  Currently, we fight over whether the climate is changing and if so if the change is man-caused.  This is a microcosm of the debate on Globalism.  Is everything so entwined that every action taken by political leaders in Sri Lanka has an effect on politics in Andorra?  Is there a need to have world governing bodies?  Must all societies agree to conform to the same standards?  These are questions about which we will hear exponentially  more in the coming year.  I hope to stay aware of the drive to “One World Order” and to understand the consequences of such a system.  Just the total ineptitude of the U.N. leads me to be very skeptical of any world governance proposals.  I am also concerned that the “global climate change” fear-mongering is just an attempt at a foot in the door advancing Global Government.

5. Innovation. It is my opinion that here is where the real hope lies.  As mentioned before, I loved The Watchman’s Rattle by Rebecca Costa.  I think she is really onto something and it is an important concept for us to watch.  The evolution of our brains has not kept pace with the evolution of our societies and the growth of our populations.  We are losing control of our destiny because we are overwhelmed by complexity beyond our capabilities.  Truly, what in life has not become more complex than it needs to be or than we want it to be?  I plan to learn more about the human brain and hopefully train mine to be more open and innovative.  I think we will develop many of the cures/solutions/fixes that will keep us from collapse as a society.  But, I don’t think it will come easy.  I think that key innovation will occur in societal/political organization (see Theory of Power by my son, Jeff Vail, for one take on this).  I think solutions will come in understanding and using human emotion and belief systems.  I hope solutions come from more reliance on facts than from retreating to the comfort of beliefs.

The good news is that change for the better is occurring, if not at the national political level.  I already notice when talking with Liberal friends that they are disgusted with many of the Orwellian measures that are being forced upon us.  They are upset at the level of taxation and regulation.  They are concerned about how many people are out of work and can see that at least part of it is due to government policy that encourages sloth/discourages work.  I notice when talking with Conservative friends that they are worried about backlash and the growth of right wing anarchist groups.  They are concerned that too many people are talking about guns and taking things into their own hands.  They worry about loss of respect for the law.  I actually think there are a growing number of folks on both sides who are leaning more toward a Libertarian/Get-Government-Off-My Back attitude.  I think there is a great opportunity for us to build on these feelings and start to work together to right the wrongs of the past 80+ years of movement to the deficit-financed welfare state.

I wish everyone a Happy, Healthy, and Thoughtful New Year.  And while you are having that Thoughtful New Year, take the time to comment here and help the conversation.  Last year, this blog was viewed over 345,000 times, but there were fewer than 500 comments.  That is too much of a one way street for my liking.  My hope for the New Year?   More comments.

A year ago, I did a post on the Value Added Tax.  You can see it here.  Today, I know that my biggest mistake in that post is that I thought we would see a VAT last summer, or at least a serious attempt at it.  Now I am convinced that Congress will try its best to pass a VAT shortly after the November election.

The following was sent to me by a friend.  It tells the story better than I can.  Please note that as pointed out by PMV in the second comment to this post, the totals are exaggerated by about half the amount of the VAT.

Current European tax rates:

United Kingdom

Income Tax:  50% VAT:  17.5%   TOTAL:  67.5%
Germany Income Tax:  45% VAT:  19%      TOTAL:  64%
France Income Tax:  40% VAT:  19.6%   TOTAL:  59.6%
Greece Income Tax:  40% VAT:  25%      TOTAL:  65%
Spain Income Tax:  45% VAT:  16%      TOTAL:  61%
Portugal Income Tax:  42% VAT:  20%      TOTAL:  62%
Sweden Income Tax:  55% VAT:  25%      TOTAL:  80%
Norway Income Tax:  54.3% VAT:  25%      TOTAL:  79.3%
Netherlands Income Tax:  52% VAT:  19%      TOTAL:  71%
Denmark Income Tax:  58% VAT:  25%      TOTAL:  83%
Finland Income Tax:  53% VAT:  22%      TOTAL:  75%

If you’ve started to wonder what the real costs of “socialism” are going to be, once the full program in these United States hits your wallet, take a look at the table.  As you digest these mind-boggling figures, keep in mind that in spite of these astronomical tax rates, these countries are still not financing their social welfare programs exclusively from tax revenues!  They are deeply mired in public debt of gargantuan proportions.   Greece has reached the point where its debt is so huge it is in imminent danger of defaulting.  That is the reason the European economic community has intervened to bail them out.  If you’re following the financial news, you know Spain and Portugal are right behind Greece .

The United States is now heading right down the same path.  The “VAT” tax in the table is the national sales tax that Europeans pay.  Stay tuned because that is exactly what you can expect to see the administration proposing after the fall elections.  The initial percentage in the United States isn’t going to be anywhere near the outrageous numbers you now see in Europe .  Guess what, the current outrageous numbers in Europe didn’t start out as outrageous either.  They started out as miniscule—right around the 1% or 2% where they will start out in the United States .  Magically however, they ran up over the years to where they are now.  Expect the same thing here.

It’s time to rethink the ‘American Dream’ idea:  It is the notion that with hard work and perseverance, anybody can get ahead economically here.  Do you think that can ever happen with tax rates between 60% and 80%?  Think again.  With the government taking that percentage of your money, your life will be exactly like life in Europe .  You will never be able to buy a home.  You will never buy a car.  You will never send your children to college.  Let’s not shuffle the battle cry of the socialists under the rug either.  It’s always the same cry.  “Equalize” income.  “Spread the wealth” to the “poor” (whoever they are).  “Level” the economic playing field.  Accomplish that and everything will be rosy.

It’s time to take a really hard look at reality.   Greece is a perfect example.  Despite the “socialism” system that has ruled this country for decades, with a 65% tax rate, they are drowning in public debt, would have defaulted without hundreds of billions in bailout money, and still. . .20% of their population lives in “poverty.”  What has all that “socialism” money bought, besides ultimate power for the politicians running the show?  Do you think these people are “free”?  They’re not.  They are slaves to their economic “system.”

We are at a tipping point in America .  We all know it.  Turn this around right now or your grandchildren will be massing in the streets of this once-great country, just as the people of Greece now are.  Economic slavery is slavery, just the same.  Carefully and deeply consider what it takes to throw off the yoke of slavery, once it takes hold and settles over your neck.


My only beef with the above is that it describes the “real costs of socialism” in dollars.  In my view, the real costs of socialism are in the dulling of initiative, the entitlement attitude, the increase in government control of our lives, and the substitution of the state for the family.  I like the following quote from Sir Winston Churchill:

“Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy.”

I am reposting this because it seems, again, very relevant.  This was first posted on June 3rd and I was most concerned with the nomination of Ms. Sonia Sotomayor as an Associate Justice of the Supreme Court.  That now appears to be a done deal but we still have a chance on “The Employee Free Choice Act,” health care reform, and the VAT, though, we may never get automobile manufacturers back from State control.

DanielWebster-big

Though Daniel Webster died over 150 years ago, he must have known Barack Obama or at least he knew and understood the type.

He said it best when he said,

“Good intentions will always be pleaded for every assumption of authority. It is hardly too strong to say that the Constitution was made to guard the people against the dangers of good intentions. There are men in all ages who mean to govern well, but they mean to govern. They promise to be good masters, but they mean to be masters.”

Think about it.  If you give Mr. Obama the benefit of the doubt (and about 30% of the population is not willing to do that – see Rasmussen Poll)(July 31 update – the number is 40%), he: 1) has the best of intentions to solve our economic woes (read, take over Chrysler and G.M.); 2) has the best intentions to provide healthcare for all Americans  (read universal healthcare for everyone in the USA, legal or not); 3) has the best intentions to simplify our tax code (read, impose additional VAT taxes); 4) has the best of intentions to lift up those who are limited by their race, gender, or culture (read, appoint an unqualified individual to the Supreme Court); 5) has the best intention to help workers by making it easier for them to organize (read, impose rules against businesses, in favor of Unions and against secret ballots)………

If Mr. Obama is able to get Ms. Sotomayor on the highest court, and it looks like he will succeed, he will have gone a long way toward removing the one defense we have against return to a Master/Slave relationship.  I don’t know how we stop this but I do know that sending  letters to each and every Senator is better than sitting and watching this happen.

Webster also warned: “Hold on, my friends, to the Constitution and to the Republic for which it stands. Miracles do not cluster and what has happened once in 6,000 years, may not happen again. Hold on to the Constitution, for if the American Constitution should fail, there will be anarchy throughout the world.”  There are good reasons not to have too liberal a view of the Constitution.

“They promise to be good masters, but they mean to be masters.”  Well put, Daniel.

pinocchio

Mr. Obama spent two years on the campaign trail.  Most of it, he spent telling us of the evils of Washington, the politics, the lies, the broken promises, the unethical behavior.  He promised  “Change.”  He promised to change the unethical behavior so rampant in ‘Washington.’  I’m not sure if he will ever defend himself by stating, “It depends on your definition of Change.”  I am sure that the change I see is not the one that I believe a majority of voters wanted.  Either we need a new definition of ‘change’ or Mr. Obama needs to stop lying to us.

Change in Washington Ethics, Example One – The day before yesterday speaking on Energy, Cap and Trade, etc., Mr. Obama said,”In the late 1970s, the state of California enacted tougher energy-efficiency policies. Over the next three decades, those policies helped create almost 1.5 million jobs. And today, Californians consume 40 percent less energy per person than the national average–which, over time, has prevented the need to build at least 24 new power plants. Think about that. California–producing jobs, their economy keeping pace with the rest of the country, and yet they have been able to maintain their energy usage at a much lower level than the rest of the country.”    His obvious intent is to convince you that strict energy laws (like the soon-to-emerge-from-Congress Cap and Trade Bill) will have us creating lots of jobs and consuming far less energy.  That is disingenuous at best, probably simple deceit, and may just be lying.  California’s population is concentrated in areas with a very mild climate and as such, most Californians require far less energy to heat and cool their homes.  My guess is that they have always used far less than the national average amount of energy.  Also, during the period Mr. Obama uses in his example, the population of California grew by 14.3 million people.  If his “create almost 1.5 million jobs” happened to be 1.43 million, that would mean one job for every ten people.  Could this be one reason that California has seen a huge exodus of industry and now has the 3rd highest unemployment rate in the country?  If a salesman used this argument on you, you would be upset and would not deal with him.  That doesn’t appear to be a choice in this case.

Change in Washington Ethics, Example TwoThe Obama-Biden plan posted online laid out the changes needed in Ethics in Government.  High on the list was the promise to eliminate pork from our government budget:  “Slash Earmarks: Earmarks grew from $7.8 billion in 1994 to $29 billion in 2006. Barack Obama is committed to returning earmarks to less than $7.8 billion a year, the level they were at before 1994.”  In the stimulus bill alone, the $7.8 Billion wouldn’t amount to a shadow of the included earmarks (see here and here among many others). Talk about challenging us to believe him!  In the same document, it reads, “Shine Light on Earmarks and Pork Barrel Spending: Obama’s Transparency and Integrity in Earmarks Act will shed light on all earmarks by disclosing the name of the legislator who asked for each earmark, along with a written justification, 72 hours before they can be approved by the full Senate.”  Have you seen that yet?  Maybe Mr. Obama is saving that for his 2nd term.

Change in Washington Ethics, Example Three – Also in the same document and in many speeches, “Sunlight Before Signing: Too often bills are rushed through Congress and to the president before the public has the opportunity to review them. As president, Obama will not sign any non-emergency bill without giving the American public an opportunity to review and comment on the White House website for five days.”  To date, he has broken this promise 5 times and is planning no such ‘Sunlight’ before signing a cap and trade bill.  Breaking a promise once may be forgiven by some.  Breaking it on a regular basis has no defense.  It is pure and simple fraud.

Change in Washington Ethics, Numbers Four through 10,000 will come with the sale of Socialized Medicine, a Value Added Tax, selling a new Associate Justice who was chosen for her race and gender, not her qualifications, etc., etc., etc.  I’m afraid we have only seen the beginning of this ‘change’ (for the worse) in Washington Ethics.

When a Republican President  (Mr. Bush) had a Republican Congress and they proceeded to spend money like drunken sailors, I was highly disappointed.  When a Democrat President (Mr. Obama) plays the ethics card for two years then acts in a blatantly unethical manner to achieve his goals I wonder about our society and our future.

The VAT is an excellent idea.  The VAT is a terrible idea.

Morphine is a wonder drug.  Morphine is a dangerous drug.

multi-forms

A Value Added Tax, properly constructed and applied can be both a fair and reasonable method of taxation to raise the funds to provide for NEEDED government services.  1.  It is relatively simple to apply.  When a value is added (when the chick grows to a hen and is sold to the butcher and again when the butcher prepares the bird for the table and sells it) a tax is applied to the amount of the value added.  In many European countries that is in the 15 – 20% range.  2.  It taxes production but most of that is at the point of consumption so it is almost like a consumption tax (read “sales tax”).  I like consumption taxes more than income taxes because income taxes punish productivity.

A Value Added Tax needs to be a substitute for other types of taxes.  If it can be imposed, in place of income and sales tax, it can dramatically streamline and simplify taxation.  Unfortunately, we have a huge infrastructure and lobby that would fight this.  For this reason, I cannot imagine a VAT could be used here as a substitute.  It would, almost certainly, be used as an ADDITIONAL method of taxation.  Since most special interests have paid lobbyists working to protect their tax breaks, almost all would fight any change that would deny them the special treatment that they get in the current tax code.  My guess is that closed to half the revenue of most CPA firms is based on tax preparation and tax advice.  If that is the case, you can bet the CPA lobby would frown on replacing the current system with VAT.

So what are the chances that we will get a Value Added Tax to replace either or both of Income and Sales taxes?  In a word: ZERO.  

What are the chances of seeing a VAT proposal in Congress to add another source of tax income for our government to spend?  In my opinion, it is almost 100%.  Our Members of Congress have spent every penny they have seen for years and are recently showing signs that what they have is not even close to satisfying their hunger for power/money (about a trillion dollars to supplement the last budget; a trillion dollars for “stimulus”, etc.).

Congress and the President will point to Europe as a shining example of how great a VAT is.  They will suggest that a 15% tax  on value added is far better than a much higher tax on incomes and sales.  What they don’t tell you is the huge increase in taxes paid by the people and the economic death spiral that accompanies such a tax system.  Here is what you need to know:

1.  A little over 40 years ago (1967), pre-VAT in Europe, the average tax burden for European countries was just a bit higher than in the USA:  In Europe, pre-VAT, the typical tax burden of government was 30% of the gross domestic product while in the U.S. government absorbed about 27% of the gross domestic product.  VAT invariably increase overall taxes.

2.  When the VAT started in the U.K. in 1979, the rate was 12.5%.  Today it is 17.5%.  When first instituted in Germany in 1974 (?), the VAT was 13%.  It is currently 19% and there is an active proposal in Berlin to raise it to 25%.  My point is that a VAT of even 1% is a foot in the door and it is sure to rise.

3.  Lawmakers have shown they can’t control the desire to do social engineering with tax code, even with the VAT.  Much like our convoluted income tax code that favors some types of income over others, or, our sales taxes that impose different taxes on different items, the VAT is subject to “modification” to exempt certain items and lower or raise rates on others.  As it stands in Europe, today, the VAT has near the complexity as our own IRS code.

4.  VAT is invisible.  It is built into the price of the good or service so you don’t recognize it as a tax.  Much like withholding tax that you don’t pay from money in your pocket, you hardly notice when rates are raised.  This means that there are few protests when rates are hiked.  The VAT, like income tax with mandatory withholding, becomes a magical money machine for government.

5.  Today in the U.S. our government (federal, state, and local) still takes about the same as 40+ years ago – 27% of the gross domestic product to provide services to all of us.  In Europe, where the VAT is almost universal, government now eats up over 40% of the domestic output.  European products become less competitive daily and governments have been forced (????) to step in and take over large portions of the economy (read “nationalize”).  Sound familiar?

In my opinion, our government has no intent to replace any other tax with the VAT.  The sole purpose of a VAT in the U.S. will be to take more money from the productive sector of the economy to build an even bigger and more controlling government.  It is in the interest of the governing class to take as much money and control from the productive sector as they can.  The VAT will be a formidable weapon in that battle.

Morphine can control pain and help patients recover when used as directed by a competent physician.  If used by people without will power, it can become an addictive killer.

The VAT, as a replacement for other taxes, shows promise to simplify taxation.  When added on to other taxes it has proven to be very dangerous, building ever-larger government bureaucracies and killing economies.  The European experience has proven that lawmakers cannot resist the power and money brought to them by a VAT.  The last thing we need is for our government to add on another way to tax our productivity.

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