Will Obama Create Wealth or Waste It
The march of man to freedom and liberty has always been hampered by the fact the rich - who by their nature financially create wealth - have been saddled financially by the poor and inefficient upon which most of that wealth is wasted. However take a moment here to realize that this march toward liberty is a relatively new historical event. It began in America 1776 with the declaration “We the people”.
Since then the whole world has marveled at the capability of an economic miracle called capitalism to turn man from the feudal slave into a truly free man. The system called capitalism allowed each man to accumulate his own capital – his own wealth – free of confiscation by the king or the state.
Against the better angels of their Founders Americans unfortunately self-imposed a confiscation of that wealth by passing the 16th Amendment to the Constitution that enabled the state to tax “incomes”. Shortly after its adoption the concept of taxing the rich was used by the majority of Americans to confiscate wealth from the wealth creating rich for redistribution to the poor – a new construct where the people elevated the state to the status of a king who they believed leveled the playing field.
A nation and its people never create great wealth by taxing its wealth creators – and America suffered from punitive taxation of those creators for several decades. The immense tax burden Americans were shouldering (91% on incomes over $50,000) was partially relieved by President John F. Kennedy in 1962 when he reduced marginal rates down to 70%. The march toward freedom and liberty and immense wealth creation was accelerated by President’s Reagan and George W. Bush who brought marginal rates down to 35% - more importantly for wealth creators they brought the taxation of investment income down to 15%.
Unfortunately for America, the success of its wealth creators and lower taxes has led to two predictable phenomenons – a massive disparity in wealth between the rich and ordinary Americans and excessive greed by those seeking wealth. This has led America to today’s fork in the road. Americans have elected as President a man whose background, experience and proposed policies will lead America back to the destruction of wealth by “redistribution by punitive taxation”. His detractors predict he is a Democrat with socialist leanings – his actions will confirm whether he believes that or not.
The first question to be answered in this regard is whether or Barack Obama is as smart as advertised. His proponents say he “mainlines” homework (a 60’s metaphor – think heroin) whereas they believe Bush never did any. They believe he will lead America to the promised land because he diligently but calmly and intelligently analyzes problems and will arrive at the right solutions for America.
The second and even more important question is will he take the redistribution fork in the road or be mathematically, economically, socially and philosophically competent enough to take the wealth creation fork. The answer to that question will determine if America continues on its path to paralyzing nannyhood or makes a turn to future growth of wealth and liberty.
I am convinced that it really won’t matter much if Barack Obama and Democrats or the Republicans prevail in this battle – the country will still be limping along in mediocrity. My contention is that the economic engine of America is stuck in first gear traveling along history’s highway at 15 miles an hour. It is my belief that the punitive taxation of the poor and middle-class in America ties the hands and feet of the people and forces them to swim in choppy economic waters leaving them just enough strength to avoid drowning.
I further believe that the Democrat party’s “progressive agenda” will put the emergency brake on an economy that can easily be redesigned to run at 200 MPH. It is up in the air whether or not Republicans are up for a redesign – being “conservative” and all. If you believe in liberty, freedom and economies that run at 200 MPH, read www.riseupamerica.us . There you can at least fantasize about a step toward the utopia we all seek.
In the meantime we can watch and see what “Barack of the people” will do. Their belief in his magical powers borders on the supernatural. Interestingly he encourages that belief. With an arrogance and confidence that great he better take the right fork in the road or the people will be taking up a new “religion”.