I want to ask the question, Who is standing up for America?
I don’t want to address every part of this. But I am most concerned about a few aspects of this, questions and points of discussion:
One, is America going to be financially viable in fifteen years if we don’t change our attitudes about taxation, budgeting, pork projects and the deficit?
Two, Is America still made for you and me? Is Federal and state land being appropriated and or destroyed by concentrated wealth and resource based business? Is our land being bought or controlled for pennies and sold back to us for dollars? Where and how do people address this land appropriation by private interests?
Three, Private property is a pretty important right in America and so is the profit motive but that needs be balanced by low income peoples right to a home and natures right to exist as well.
Four, the Covid 19 epidemic that has swept the country is causing a slowdown and reassessment of life as we know it. These problems that I mention are being looked at in a new light, when we consider Covid 19 and climate change. Is there an opening for a profound shift?
What is America? It’s a country. It’s a concept. It’s the land. It’s the rivers and prairies. Its the cities and roads. It’s the government. It’s the infrastructure that supports the transport of physical goods. Its the communications network. It’s the concept of knowing that money put in a bank will be safe. It’s the knowledge that our governmental structure will endure. Its our culture. Its our freedom and liberty, to move about the country as we chose and chose who we associate with and marry. Its our freedom to choose what work we do and how we do it. It’s the knowledge that our water is safe to drink and can support robust salmon runs. It’s the knowledge that our meat is safe to eat. It’s the concept that everyone has a fair shake at success in life if they are willing to work for it. It’s the concept that we are a wealthy country and we can help the downtrodden and old and disabled. It’s the concept that we are big enough to help other countries, financially, militarily, culturally and engage and interact positively.
I want to start on a personal basis.
This year I will pay virtually no Federal income taxes. Since 2013 I think I have paid less than $5000 in Federal Income taxes. The only federal income taxes I have paid were related to self-employment income which supposedly goes towards social security payments. I am a fairly-low income earning American but there is a little more to the story that that.
In the early 2000’ (the aughts) I was living and working in Oakland California. The Dot com boom and bust were in full swing, so was Bush II’s wars and so was property growth and speculation. I was starting and running a tree service business, and living in an apartment.
The war business was horrible but people are good at compartmentalizing so you put that aside sometimes. Properties were appreciating all around me. I wanted to get into the game too but didn’t have a lot of cash. I was late to the party and by the time I was ready the west coast markets had gotten expensive. But banks had easy terms. I went to Oregon and found a property that seemed like it had potential. This market had gone up substantially as well, however. With mostly borrowed money I offered and got accepted on a property with an acre of land, a house and a barn. Not fancy but substantial and as it turned out, beyond my means for the price.
While I and an associate planned to rent out the front, the barn was reserved for the associate to live in and manage the property but first his apartment needed to be constructed. This happened over the next year and put me further in debt.
As I continued to live in Oakland, California, I was not able to stay on top of things when problems at the property occurred with tenants, with collecting rents etc. When the economy tanked, I held on for several years but got behind on mortgage payments. Ultimately in 2013 I lost the property to foreclosure.
I believe I had what is termed a sub-prime mortgage, meaning a loan with terms that are beneficial for the bank and not so beneficial for me. It was interest only to keep payments down. At some point the terms demanded I make substantially higher payments to cover principal. Also, interest was variable and could go up precipitously when benchmark rates went up.
When I got into trouble with the loan in late 2008 and into 2009, I contacted the bank and got a form to fill out regarding renegotiating or postponing payments as part of the TARP program that was part of the government bailout of the banks. I found out that my loan was no longer owned by Wells Fargo Bank. They had packaged and resold my loan along with many other loans, to a group of investors. The investors used Wells Fargo as the loan servicer but after multiple attempts to revise the loan or delay payment I got no where. In fact, I was never able to even speak with a representative of the investor group.
I saw that banks and financial institutions had been bailed out. The financial bailout of 2008, 9 and 10 saw the government loan, grant and protect many large companies, often the same companies whose dangerous practices had brought about the housing bubble and subsequent collapse. I got nothing. Millions of people lost houses and other investments.
My loan and house were foreclosed. My tax agent was able to show my loss of down payment and other payments as a tax loss that is carried forward every year till it is used up.
While this tax reduction has helped me get through a difficult financial time without having to declare a personal bankruptcy, our federal government has not gotten its tax revenues or pound of flesh from me.
Obama inherited the financial meltdown and acted as best he could with all the pressures to save businesses and prop up the economy. This started 4 years of above $1 Trillion deficit annual spending to stabilize the economy and fund the military and all the programs that people rely upon. It wasn’t until 2013 that the annual deficit went again below $1 trillion. This was despite the strong challenge to government as usual from the Tea Party Republicans that stressed cutting the federal deficit as necessary to protect the financial viability of our country.
The tea party republicans have gotten very quiet since Donald Trump took the office and Republicans controlled the Senate. Little was said when Trump proposed more tax cuts and more spending increases for war and nuclear weapons.
In 2019 Trump’s tax cut caused reduced revenues and a ballooning deficit, when we should have been reversing the trend as the economy appeared strong. The official deficit in 2019 was $1.092 trillion according to the balance.com, an online site that tracks US government revenue, spending and the deficit. This was the first deficit over $1 trillion since the 2013 when was again booming after the financial meltdown of 2008, 9, 10.
I recently watched a documentary called the https://www.powerofzero.com/movie, a film by Doug Orchard. The main presenter of the ideas is David McKnight who speaks passionately and clearly about the impending debt crisis that we are in and that our government officials never seem able to take on because it is unpalatable. The movie makes the case that the debt is ballooning out of control and may bankrupt the whole country when other governments and investors at some point refuse to continue loaning money to our country. The point when other governments and investors are no longer willing to buy a governments debt or bonds, is called a sovereign debt crisis. McKnight claims this sovereign debt crisis will occur within 15 years on the current trajectory.
Tom McKlintock is prominently featured in the film. He is conservative California Republican with a strong penchant for balancing the debt. I think he was a state senator or assemblyman in the 80’s and 90’s in California where I was living during that era. He unsuccessfully ran for governor in the recall election of 2003 when Arnold Schwarzenegger became the governor, replacing Gray Davis.
Now McKlintock is a Republican Congressman representing District 4 in California where Lake Tahoe and Yosemite National Park are located. He is not particularly friendly to the environment or the climate. He is often for cutting taxes for corporations. He is also an outspoken critic of budget deficits and believes we should balance the annual budgets. So, to me he is a bit self-contradictory in that he is for cutting taxes yet he is also a strong advocate for cutting spending and balancing the budget. I was impressed with his clear warning in this movie about the impending debt crisis. He says quite clearly, “The road we are on is a perilous one, one that leads, ultimately, to the bankrupting of our country.”
In this we can agree. If we want the American Experiment to be a long lasting one, we should be paying our bills as we go along, at least when economic times are strong. Instead our government acts as if a large portion of its bills can be put on a national credit card to pile up and never be paid down.
Neither party seems up to taking on the deficit issue though many offer lip service to it. Most recently in 2012 and 2013 the Tea Party Republicans made a big stink about not raising the debt ceiling while Obama was in office. They assumed the position that adding to the debt and raising the debt ceiling was dangerous to the stability of the country. Somehow, they don’t talk about it now that Donald Trump is president.
I started this piece mentioning that I have paid little federal taxes since 2013. The reason for mentioning this is, to personalize it and show that we are all somewhat responsible to our country. I think of the tragedy of the commons. We all enjoy clean water and fresh fish. Yet when we have freedom to fish as much as we please and pollution regulations are weak or not enforced, the commons, i.e. the rivers or oceans we all enjoy and nobody owns, suffers.
The Federal Government and it’s solvency is also part of the commons. The individual does not greatly benefit by paying their share of taxes. Society benefits. A government is more stable if people pay taxes.
This tragedy of the commons I would argue is one of the most glaring flaws of capitalism and the battle of nation states for resources. When there is no agreement on protecting certain common resources such as clean water, fishing rights, clean air, a stable climate, biodiversity, wild lands there is a rush to exploit them from the most pernicious of people or organizations.
This exploitation inevitably leads to degradation of the commons which means we all lose. Capitalism intensifies this. It is part of capitalism inherently I believe and must now be challenged head on.
I guess what I am getting at in a round about way is that America the concept is being expropriated cynically by the few and powerful for their benefit. They do not seem to care that:
1. their desire to avoid paying taxes and
2. to take tax breaks, protection and stimulus from the government and
3. exploitation of resources (nature) that are meant to be for us all
threatens the very future of the American State and the stability of climate and the biodiversity of life.
Further, Americans are taking the lead from the expropriators and are not into paying taxes, are cynical about government programs and are overwhelmed when we consider bringing the exploiters under control.
Who defends America? Who defends the financial stability of our government? Who does the government work for?
Most politicians want to bring federal money to their districts. Most support large defense budgets. Liberal democrats want to expand social programs. But how will we pay for it?
I am a big fan of Bernie Sanders, but I believe he is going too far when he wants all health care for free, college tuition for free, workers sick leave to be covered and many other social programs.
So, I feel like asking the question, “Who really is defending America?”
And so it goes and so the deficit grows. The on-paper deficit now stands at $24
Trillion. The actual deficit according to the movie I referenced before, the Power of Zero, is actually $200 trillion. There are many expenditures that government is obligated to pay for but is off the books, I learned. This is a fact.
Now we are dealing with the Covid 19 crisis. This crisis has made many abrupt changes to life in America. It has caused the Federal Government to again bail out the economy to the tune of $2.2 trillion, so far. More to come. People are questioning life in America, life on the planet really. We can’t go on as we have been going. We recognize that this virus is spread and is closely tied with people and things moving about.
It is sad what is happening to our America. It is being exploited. The government is asked to cover the cost of disasters of all kinds. It is asked to give special tax breaks to big business. And person like me, a working person for the past 20 years, because of circumstances described also pays little in Federal taxes. Nor are corporations, Nor is the wealthy. Who pays the taxes? Apparently fewer and fewer.
I am truly sad about it. America is like a bloated dying animal that all are trying to get a piece of before he/she dies.
But who is out there to defend the interests of Government solvency? Our government is so big, the expenses and revenues are so massive that people and business think, “Oh how could it hurt if they just gave me or my business this break? It won’t matter, everyone else is doing it?”
My tax enrolled agent showed that I lost money. Each year the loss is carried forward and it reduces my stated income each year till it is used up. For me of course this has been welcome and made getting by easier. But am I robbing the federal treasury by making this claim? Maybe but it is legal. I am carrying forward a loss from real estate. When I win in real estate I do pay taxes on capital gains but there are ways to reduce and delay paying taxes if you buy another property. So many games that investors play.
Real estate mortgage interest is tax deductible. Should it be? I believe that only a person’s primary home mortgage interest should be deductible. But who is defending the treasury? Not real estate investors.
If real estate mortgage interest was not tax deductible that would change things. Maybe for the better. Real estate speculation would be less profitable, less rampant. Maybe banks wouldn’t charge as much for origination if the costs and interest were not tax deductible.
I’m not paying much in federal taxes, the corporations are not paying much in taxes, baby boomers are retiring and will not be paying taxes soon, young people are strapped in trying to raise a family and buy a home. If all these parties are or soon to be not paying much who is looking after America, the mythical father and mother of us all. At some point rich foreigners will stop buying our security bonds to continue financing our deficit spends. Who will take care of America then?
Thank you to
Thebalance.com for information on government revenues, deficits and budgets.
The movie “the power of zero.”