The Turning Point

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Status: Finished  |  Genre: Non-Fiction  |  House: Booksie Classic

The next four years will determine if we remain a Capitalist country or become a Socialist one.

Submitted: October 03, 2017

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Submitted: October 03, 2017



The Turning Point

The four years of the Trump administration is just a point in time, a second in the history of human civilization. However, these four years could determine whether America follows its arc of history or the European arc, the belief that individuals are responsible for their own lives or that government is. We are currently at the turning point, and could go in either direction.

Ronald Regan was in a similar positon thirty seven years ago, and was able to move the needle in the historic American direction, since then it has moved back towards the European model. Donald Trump is not in any way similar to Ronald Regan. He was not a Republican and he is not a conservative. That being said, there are some similarities in their approach to governing.

In Regan’s 1980 campaign brochure the opening sentence is,” There is a crisis of leadership in America today that only new, strong leadership can correct.” Other statements are, “The growth of federal spending will be controlled. A freeze on federal hiring will be instituted immediately.” “Ronald Reagan believes in the need to devise lasting solutions to problems, and in the need to combine a sense of caring with a sense of the cost involved.” “He would, as President, put together the finest team to assist in the formulation and implementation of both domestic and foreign policies.” "We know only too well that war comes not when the forces of freedom are strong, but when they are weak. It is then that tyrants are tempted." When speaking about the economy he said he has, “an economic program for America that will work because it's a comprehensive program. A program that recognizes the interrelationships and complexity of our that combines the wisdom of leading American economists with common sense.”

President Trump has many of the same priorities, but is handicapped by his position in history. In the 2016 presidential primaries there were two candidates who were not members of the parties they were trying to get to nominate them. Trump had often voted for Democrats and Sanders was a Socialist that caucused with the Democrats. Both parties strongly resented the attempted takeover. The Democratic party leaders conspired against Sanders and denied him the nomination, The Republican party leaders conspired against Trump to a lesser extent, but they were unsuccessful. The grudges in both parties are still evident eleven months after the election and hinder the efforts of the Trump Administration.

From the earliest days of civilization there was an understanding that the younger generation would have to look after the older one when it was no longer able to care for itself. This came into being out of necessity. If children let their parents die, then their children would let them die. In medieval Europe, the feudal system was the basis of economic security, with the feudal lord responsible for the economic survival of the serfs working on the estate. In the Middle Ages guilds provided some economic benefits to their members.  Before the industrial revolution large families were the norm to ensure that there would be some children left alive to care for the farm and their parents. Later, as children moved to the cities to find work, the understanding dissolved and was replaced by government.

In 1935 President Roosevelt signed the Social Security act with the statement, "We can never insure one hundred percent of the population against one hundred percent of the hazards and vicissitudes of life, but we have tried to frame a law which will give some measure of protection to the average citizen and to his family against the loss of a job and against poverty-ridden old age. “ It has grown considerably since then.

The effect of the Social Security Act was to mandate that future generations would pay for current generations retirement expenses. I paid or my father’s, my children pay for mine, their children will pay for theirs, if he system doesn’t implode first. It is Ponzi scheme, where the first ones in benefit the most and the last ones in are the losers. Our national debt of twenty trillion dollars is a much larger version of the same scheme. It is debt accumulated to benefit the current generation and to be paid for by future generations. They will pay for it with higher taxes and inflation that reduces the value of their money.

That being the case, a logical question would be, “How much do future generations owe us?” The answer that immediately comes to mind is “nothing”, but that would not be correct. Previous generations risked their lives and property to build the nation we live in and preserve the freedoms we enjoy. Every generation does this to the benefit of future generations, “paying it forward”. That being the case, how much do they owe us? Is there a limit? If there is, what is the limit? If you do not have children you might say that there is no limit, because your debt ends when you die. However, if you are a parent it is a morally imperative question. Can you look your six year old child in the eyes and say, ”Thanks for supporting me with one third of your income when you grow up”?  No, we are not there yet, but we are at the turning point. An old idea, “guaranteed income,” is being brushed off and presented as the solution to all of our social and economic problems. It requires the Federal government to send our taxes to every citizen in the form of a check sufficiently large enough to pay for their day to day living expenses. A quote from one of its supporters,” Paying for it would require raising taxes in some fashion that would have the effect of clawing some or all of the money back from most households while hitting up the wealthy for even more.” I will give you more details about this at the end.

 By instituting a guaranteed income, our government, not content with playing doctor for all of America,  would now play  “daddy” and give us an allowance out of our own earnings.  Would you tell your child who earned thirty dollars delivering newspapers to give you the money and then give twenty back because you want to stay home and watch television? That is what this proposal does.  It would force productive people to support non-productive people, not because they were dis-abled or couldn’t find work, but simply because they did not want to work! But this is only the most recent proposal for the European model (read socialistic) of government, currently led by Bernie Sanders.

 He has many ideas. He doesn’t think that capitalism is fair because it doesn’t distribute the wealth of the county evenly, like (in theory) a socialist economy does.  He calls for a $15 dollar an hour minimum wage. Seattle tried that, and this was the results reported by a University of Washington study. The cost to low wage workers was three times larger than the benefits. It cost more than five thousand jobs. Workers that received the higher wage lost an average of $125 a month because employers reduced their hours. As one of the study’s authors said, “Basically, what we’re doing is we’re removing the bottom rung of the ladder.”

His plan to provide free collage tuition is conservatively estimated to cost seventy five billion dollars a year.  He wants to bring “climate deniers” to justice. Can socialist deniers be far behind?  His immigration plan includes expanding DACA and DAPA, and providing permanent immigration relief to families. He wants to expand the National affordable housing trust fund, which he introduced in 2008, by five billion dollars per year. He would require employers to provide at least 12 weeks of paid family and medical leave.  He is especially generous with healthcare. Here is a quote from his website:

“Bernie’s plan would create a federally administered single-payer health care program. Universal single-payer health care means comprehensive coverage for all Americans. Bernie’s plan will cover the entire continuum of health care, from inpatient to outpatient care; preventive to emergency care; primary care to specialty care, including long-term and palliative care; vision, hearing and oral health care; mental health and substance abuse services; as well as prescription medications, medical equipment, supplies, diagnostics and treatments." He estimates the cost of his pan to be 1.38 trillion dollars per year.  Others estimates are 2.4, 2.5, ad 2.8 trillion dollars a year. He would pay for his grandiose schemes by raising everyone’s taxes. The current three rates of 33%, 35% and 39.6% would be increased to four rates of 37%, 46%, 48%, and 52%. He would also eliminate many of the tax deductions in the tax code. This cost is in addition to 7.7% Social Security Taxes (yes it is a tax) that you currently pay. Socialism isn’t cheap!

One proposal for a guaranteed income plan is to give everyone $10,000 a year. For 296 million people the cost would be 2.96 trillion dollars a year. Let’s look at the debt that we would be passing on to future generations if these plans were enacted.  The debt per person of all Federal debt now is estimated to currently be about $62.000. Single payer health care and guaranteed income programs would add about $3,380 per person to it. How can we justify this? (Thanks for the $65,000 loan kids, I sorry that I’ll be dead and will not be able to pay you back!) This is an extreme form of greed, where one generation force ably takes wealth from another generation without their consent (they had no choice in the matter). A better name for it would be theft.  Let us take a look at who the creditors for the current twenty trillions dollars of debt are.  You may be surprised to learn that we owe 72% of it (public debt) to ourselves!  The breakdown is as follows:

Public debt - $14.4 trillion. (1/2 owed to foreign governments and investors, ¼ to other government entities)

Social Security trust fund – $2.8 trillion

Government retirement funds - $888 billion

Military retirement funds-$670 billion

Medicare-$294 billion

All other retirement funds-$304 billion

Cash to fund the Federal government-$580 billion

Almost half of the treasury debt is held in trust for our retirement!  If the government defaults on its debt, retirees would be hurt the most.  The national debt reached the $1 trillion level in 1982. In the next 35 years it grew another $19 trillion. It has been growing at the rate of $1 trillion a year for several years.  Is there any limit to how high it can go? Socialist do not seem to think that there is. Many people did not think that there was a limit to how high home prices could go until that Ponzi scheme fell apart overnight.  What will happen when the creditors will no longer accept our government’s credit cards? It happened to Iceland and they had to declare bankruptcy.

We cannot undo the past, we can only hope to redeem ourselves for creating it. We must stop granting ourselves more and more “entitlements” and start to pay back (by reducing the national debt) the future generations. If we do not the current unrest in this country will look like the thunder before the storm. We are at the turning point now.

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