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Taxes
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Taking my money to support others - a failed policy |
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Written by Dr. Rich Swier
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Sunday, 07 September 2008 |
After living in our city home for two years, where my healthcare needs were provided by a Tulsa-based HMO, we decided in May of 2007 to sell our home in the city and live full time at our lake home, situated in a remote 720-acre gated community of beautiful lakes, rolling hills, and crystal clear streams… a place where it’s possible to catch dozens of bass or crappie in an hour or two of fishing, and the lake is just a short block from our front door. Who would begrudge me the chance to live in a place like this? No one I can think of… except, of course, the Medicare bureaucrats in Washington who instructed my HMO that, since I’ve relocated across county lines, they are no longer permitted to manage my healthcare needs. And since I was unaware of the rule which requires Medicare recipients to register with a new HMO or PPO within 60 days of a change of residence (how silly of me not to invite a Medicare agent to our real estate closing), I became the subject of a raging dispute between the Medicare bureaucracy and my new insurer, Humana, over who, if anyone, would be allowed to manage my healthcare needs. They’ve been fighting for fifteen months now and they’re still at it. Do the Washington bureaucrats who made that rule care one whit if I live or die? No, all they care about is keeping their government jobs so that they can have access to a taxpayer-financed healthcare program for the rest of their lives. The entire affair tells me that its time to get serious about solving our healthcare dilemma. So how do we get rid of waste and corruption, eliminate frivolous malpractice lawsuits, and improve the quality of and the access to healthcare, while reducing costs to make it affordable for everyone? That’s a very large order… as Hillary Clinton learned in 1993. We can begin by recognizing that the hundreds of thousands of nameless, faceless paper-pushers who work for Medicare, Medicaid, the HMOs, and the health insurance companies, and the tens of thousands of lawyers who, like John Edwards, make millions suing doctors and hospitals, are pure non-productive overhead. They contribute nothing to anyone’s healthcare needs and they can easily be declared expendable. But how do we design a system in which all of those people disappear? A longtime friend, a retired computer whiz who was one of the principal architects of the Sabre reservation system that is used by all of our domestic airlines, has suggested the perfect model for transforming our chaotic and outrageously expensive healthcare system into an efficient and affordable system. He suggests that we design the basic “architecture” of universal healthcare by first doing it to the lawyers… Oops! I should say, by converting our broken and outrageously expensive legal system into an effective and affordable justice system, which actually provides equal protection of the law for every citizen… as our Founding Fathers intended. Section 1 of the Fourteenth Amendment contains what is referred to as the “equal protection” clause. It says, in part, that no state shall “deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.” Nowhere does it say that a citizen is guaranteed equal protection of the law… only if he/she has the financial resources to purchase the services of an intermediary who has gone to school to learn the intricacies of manipulating or circumventing the law. Logically, the first step in developing a universal justice system would be to make all lawyers employees of the state in which they are licensed to practice. They and their legal assistants would be provided office facilities in state-owned office buildings and compensated out of funds appropriated by the legislatures. Those who choose to practice in the arena of federal law would be compensated under the federal Civil Service System. Salaries in the legal profession would be commensurate with those in other professions, such as science, engineering, journalism, academia, accounting, etc. There would be no more multi-million dollar contingency fees. Those persons, organizations, or corporations involved in disputes requiring legal remediation would make application for representation to a government legal services office. Disputes of a civil nature (tort law) requiring simple finding of fact, arbitration, and determination of liability would be assigned to general practitioners, while those of a more complicated nature, requiring special knowledge and experience in specific areas of the law… taxes, corporate law, intellectual properties, anti-trust, etc… would be assigned to attorneys with the appropriate legal specialty. To insure that the universal justice system would not become a burden to the taxpayers, and to insure that complainants would not use the system as a means of unfairly enriching themselves at the expense of others, the courts would operate under the British “loser pays” system wherein unsuccessful litigants would be required to pay court costs, in addition to any punitive and actual damages awarded by the court. To avoid any repeats of the O.J. Simpson debacle, juries would be drawn from a pool of paid professionals (peers) comprised of retired senior citizens, all of whom would be required to demonstrate a record of at least fifty consecutive years free of conviction for any offense greater than a traffic violation. The creation of a universal healthcare system, such as those recommended by Hillary Clinton and Barack Obama, could easily bankrupt the nation and destroy whatever positive aspects now exist. None of the plans trotted out by Democrats or Republicans hinge on creating economies, reducing waste and inefficiency, or eliminating non-productive overhead… a fatal flaw. The lessons learned in transforming our dysfunctional and outrageously expensive legal system could later be applied to the transformation of our equally dysfunctional and outrageously expensive healthcare system. In a nation with far too many lawyers and far too few physicians, I vote we first practice on the lawyers. |
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Bailout! Watch your wallets! |
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Written by Dr. Rich Swier
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Sunday, 27 July 2008 |
Congress has enacted recently legislation to resolve the worst housing crisis since the Great Depression. This will be the government’s greatest effort to stabilize the mortgage and financial markets. The dice have been rolled for the fate of 300 million Americans.
The legislation has several key features: $300 billion program to refinance loans for struggling borrowers Dramatic rescue plan for embattled mortgage finance firms Fannie Mae and Freddie Mac. Creation of a new regulator for these Government Sponsored Enterprises Increase in the federal debt limit to $10.6 trillion Reform the Federal Housing Administration. Wall Street Journal in an article July 24, 2008, “Housing Bill Will Extend Federal Role in Markets” highlighted the costs and expanded scope of the federal government. Tax Credits for first-time home buyers: $4.6 billion FHA insurance for up to $ 300 billion of home loans: $729 million Raised loan limits for FNMA and Freddie Mac to 115% of local area median home price, up to $ 625,000 Raised limit on federal debt to $10.6 trillion from $9.8 trillion Bill eliminated seller-funded down-payment assistance for loans backed by FHA. FHA has lost billions to date under this program Ironically, twelve months ago, there was almost universal confidence in the American housing market as well as the public and private institutions that supported it. Alan Greenspan waxed enthusiastically about the rising percentage of American homeowners. He rebuffed critics. The past twelve months have been sobering. In April 2008 former Secretary of the Treasury Lawrence Summers predicted in testimony to a Senate Committee that What shattered the foundation of the American housing industry?
Housing Prices Can Decline! On a national basis, until the last twelve months house prices had not dropped since the Great Depression. The National Association of Realtors reported that for the month ending June 2008 prices dropped 6.1% from one year ago.
Only a few critics recognized that Fannie Mae, Freddie Mac and the Federal Housing Administration, the supposed bulwark for our housing market were in dire financial straits themselves. Over the past thirty years, these institutions have become the dominant players in providing money or insurance for home mortgages. Specifically, Fannie, Freddie, and the FHA in the second quarter of 2008 accounted for 90% of the United States home mortgage origination. They either hold or guarantee $5.3 trillion of mortgage debt, covering about half the outstanding mortgages in the U.S. Democratic leaders such as Representative Barney Frank, the House Financial Services Committee chairman, and Senator Christopher J. Dodd, the Senate Banking Committee chairman feel that the best solution to our present crisis was the establishment of a new regulator for Fannie Mae and Freddie Mac and pouring billions of dollars into these institutions. Senator John McCain questions whether Fannie and Freddie can be effectively regulated. He wrote an editorial dated July 24, 2008 to the St. Petersburg Times “Take taxpayers off hook for rot at Fannie, Freddie.” McCain wrote that Americans should be outraged at the latest sweetheart deal in Washington. Congress will put United States taxpayers on the hook for potentially hundreds of billions of dollars to bail out Fannie Mae and Freddie Mac. It's a tribute to what these two have bought with more than $170-million worth of lobbyists in the past decade. With combined obligations of roughly $5-trillion, the rapid failure of Fannie and Freddie would be a threat to mortgage markets and financial markets as a whole. Because of that threat, I support taking the unfortunate but necessary steps needed to keep the financial troubles at these two companies from further squeezing American families. Paul Gigot the editorial page editor of the Wall Street Journal argued in an editorial on April 21, 2008 “Too Political to Fail” that Fannie and Freddie have been able to purchase political immunity for decades by disguising their vast profit-making machine in the cloak of "affordable housing." To be more precise, Fan and Fred have been protected by an alliance of Capitol Hill and Wall Street even after overstating earnings by tens of billions of dollars.
In conclusion, we need to question whether American home ownership is best served by the market place or creating institutions “too big to fail” that have a taxpayer safety net. Hopefully, we have not resolved our current housing crisis by sowing the seeds of the next. PUBLISHER'S NOTE: Remember how the Democrats, when they took control of Congress in 2006, pledged to get us out of the war in Iraq, cut the deficit, restore confidence in America, eliminate "ear marks", bring transparency to Congress, stop the strangle hold of lobbyists, and make our lives easier? Since Democrats took control in 2006 we have seen a housing market bust, a financial market meltdown, rising food and fuel prices, oil over $140 a barrel, a dollar in decline, Congress with a 9% approval rating, more inaction than action, and for the first time in history declining housing prices as noted by Doc Werlin. I have heard more and more people express outrage over bailing out banks, Fannie and Freddie. What do you think? |
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Are you living at the expense of everybody else? |
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Written by Dr. Rich Swier
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Tuesday, 17 June 2008 |
I read the article in today's Sarasota Herald-Tribune by Jeremy Wallace titled, "Tax liens against Buchanan Explained". Jeremy did a good job pointing out that what all the hubbub is about is a IRS clerical error.
I began thinking about writing an article about gotcha politics and journalists that spend their entire careers digging up the dirt on politicians. Suddenly I realized that everyone was missing the whole point of this story about one of Congressman Buchanan's many successful businesses.
The whole point is taxes!
Nationally syndicated columnist Walter E. Williams compares paying taxes to "slavery". Walter states, "The average American worker toils from January 1st to the end of April, and has no legal claim to the fruits of his labor for that period. Federal, state and local governments, through the tax code, take what he produces. A small portion of the fruits of his labor is used to provide for the constitutional functions of government. Most of what's taken, up to two-thirds, is given to some other American in the forms of farm and business subsidies, Social Security, Medicare, welfare and hundreds of other government handout programs. As in slavery, one person is being forcibly used to serve the purposes of another person."
I was thinking what if we didn't pay any federal income taxes? What if VB Investments could keep the $556,000 it sent to the government?
Let's see, that money could be used to hire 10 employees for $55,600 a year. It could be reinvested in the company to build a new office building, which would help our slumping construction industry. It could be invested in stocks to give other businesses capital to work with and grow. It could be used to fund a new startup company, which employs even more people. It could be deposited in a bank and loaned to individuals that are having a hard time getting a mortgage. It could be given to charity to help great causes.
Congressman Buchanan and thousands of wealthy individuals like him do this every day, pay outrageous amounts in taxes. What if they had all that money to reinvest in their businesses to create jobs, pay their employees a higher salary or improve health care benefits? What if they just spent it on themselves to buy new cars, boats, homes, condos and luxury items, fueling each of these industries that employ tens of thousands of people across America?
As Claude Frederic Bastiat, French economist, legislator and writer who championed private property, free markets, and limited government, said, "Government is the great fiction, through which everybody endeavors to live at the expense of everybody else".
Do you endeavor to live at the expense of everybody else? Vern and Sandy Buchanan don't. We should thank them. |
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