Back in the Saddle

A friend of mine asked me about returning to blogging. I haven't blogged in a long time, but I have much to say. So, here I am again after a 2 year hiatus.

These days, unrest in the Middle East has been prominent in the news. For a change it has more to do with the people uprising against their corrupt dictators. Another difference from just a few years ago is the reaction of US leaders. When the people of Egypt began an uprising last month, the President Obama seemed to change his position depending on who was likely to come out on top. Finally, Mubarak resigned after which President Obama threw his support behind the protesters. I guess it's easier to be on the right side of history if you come in after the decisions are made.

Now with the unrest in Libya, the administration has been criticized for not taking a stand. After the protesters have taken control of half the country and Gaddafi sounds more and more like he's losing control, President Obama has taken the side of the protesters. While I don't know much about the groups or individuals fighting for control over the country, I do know that I would have preferred Gaggafi to have been overthrown 20 years ago. But, what should be the US role in this? Obama is now talking tough and saying that he will not rule out enforcing a "no fly zone" within the country to keep Gaddafi's troops from attacking the rebels.

Really?

Obama has proudly proclaimed that he opposed the war in Iraq, where the US had a UN resolution and a formal agreement with Iraq to enforce weapons inspections and other sanctions. Now, in a sovereign country where the US has absolutely no authority, he wants to flex his muscles. I imagine it is to help ensure that his side wins now that he has actually chosen a side.

However, I believe one of the most intriguing parts of the story is that George Bush is getting no credit in the media for what the media refers to as Democratic movements in both Egypt and Libya. Why should Bush get any credit? Well, Bush claimed that helping to institute a representative government in Iraq would spill over and lead to Democratic uprisings in other Middle Eastern countries. I'm sure the press will see this as just a coincidence and somehow proclaim Obama as the messiah of the people in the Middle East, just like they portrayed him to be the Messiah during his presidential campaign. But I remember and credit President Bush. Apparently he was right.

Interesting Facts

Here is some data I put together last night after I finished my school work. Perhaps you will find it interesting.

If we were to spend $1 per second, this is how long it would take to make the following amounts of money…

$100 ($1 hundred) 1 minute 40 seconds
$1,000 ($1 thousand) 16 minutes 40 seconds
$1,000,000 ($1 million) 11 days 13 hours 46 minutes 40 seconds
$1,000,000,000 ($1 billion) 31 years 251 days 7 hours 46 minutes 40 seconds
$1,000,000,000,000 ($1 trillion) 31,688 years 32 days 1 hour 46 minutes 40 seconds

The new stimulus bill, just this one bill, not including the stimulus already passed last year, is $790 billion.
This is equivalent to $1 per second for 25,033 years 215 days 6 hours 26 minutes 40 seconds

In other words, if we started collecting $1 per second from the time Jesus was born, we would only have 23 millenniums left to go.

More interesting figures…
The Social Security Administration states that the average wages for 2008 were $40,405.48
According to the Bureau of Labor Statistics, there are 153,716,000 workers in the United Sates. This includes both employed and unemployed workers. Of these, 142,099,000 are currently employed.
To pay for this stimulus package, just this one bill, employed workers would have to pay 13.8% of their gross income.

Even more interesting figures…
According to the US treasury, the US debt is at $10,713,124,215,572.20 (more than $10 trillion). To pay off this debt every working American would have to pay 100% of their gross wages for 1 year 316 days 6 hours 20 minutes 49 seconds.

Sadly, this would just cover the debt, not the actual operating expenses of the Federal Government for that time.

Exposing Greed

Over the last several months we have heard much talk about greed. Politicians refer to greed when talking about successful companies. Greed is a great talking point for elections. After all, we all know greed is bad. The problem is, greed may make for a great story, but it doesn’t explain the realities of economics as the politicians would like us to believe. A couple months ago, congress dragged the heads of the “greedy” oil companies to testify as to why they were making so much profit while American’s were “suffering” with high gas prices. Many members of congress alluded to their beliefs that the only reason gas prices were high is because of the greed of the oil companies. Then the blame shifted to the greedy speculators. To cap it off, this mind set was exposed by “Joe the Plumber” when Barack Obama told of his desire to “share the wealth.”

To expose the politicians for their grandstanding, I want to point out that none have yet to invite the oil company executives back to thank them for their generosity. Nor have I sent the speculators thanked for being in the Christmas spirit. After all, if the only reason that prices were high was because of greed, it must also be true that the reason the prices have come back down is because these same people have somehow changed and become generous. Of course that’s not going to happen, which shows that even the politicians themselves don’t believe their own nonsense.

The truth is that the government made more money in taxes from the oil companies than the oil companies made profits. I don’t know if it’s true, but I heard that the largest oil company in the U.S. paid more taxes than the bottom 40% of all taxpayers in the Unites States combined. I guess that would seem fair if they made more money than the bottom 40% of the taxpayers too, but I doubt that that is true. In reality, there are many companies that made more profit per dollar spent than the oil companies did, but they don’t make good targets like the oil companies.

Now, oil companies are not robbing people. I have never had anyone come to my door and force or threaten me to exchange money for gasoline. However, I do voluntarily gibe the oil companies some of my money because they give me something that I want more than the amount of money I spend with them. If it wasn’t worth the cost, I wouldn’t buy it. It’s true, I was unhappy about the cost of gas this last summer, just like many others. I’m also unhappy about the cost of flat panel LCD TV. The difference is that I don’t think the cost of the TV is worth what I would have to pay to get one, so I haven’t purchased one. People argue that gas is a necessity, but I know people who ride their bikes to work at my office. People can get jobs closer to home or move closer to their jobs. If they don’t that means they prefer to pay the price of gas than to change some other aspect of their lives. Instead of complaining, maybe people should thank the oil companies for supplying them the fuel they need to live and work where they want instead of where they need to.

Enough about oil companies, let’s look at true greed. Greed s not the desire to keep what we work hard for, nor is it to desire to have more than another. Greed is willingness to act unfairly or manipulate or hurt others to get things we don’t deserve. This is why I predict the oncoming exposure of greed in corporate America. This is different from what is talked about by politicians or so called news people today. I am talking about the companies that got the government for special deals, loans, bailouts, or some form of favoritism to get what they couldn’t get on their own.

We are already seeing this greed exposed. It started with Freddie Mac and Fannie Mae. These companies took on more and more risky loans because the executives were paid based on how much money they controlled in loans. Now we see it in companies like AIG who has taken several billion dollars of tax payers’ money while still paying for luxurious trips for its executives. We see the CEOs of the three major US car manufacturers going to congress and asking for $25 billion to stay in business. These same executives all flied from Detroit to Washington, DC in separate corporate jets. Apparently, executive travel isn’t one of the areas where they need to cut back. They also told congress that they don’t have enough money to make it to the end of the year. Fortunately, it looks like congress will not act until after the inauguration. Assuming these companies will still be around then, perhaps we should remind them of the story of the boy who cried wolf.

The fact is, there are many financial institutions that are not in deep trouble right now because they didn’t invest in all these risky securities. Unfortunately, everyone has been hit at some level because these securities were spread throughout so many areas that one can invest in a company that has nothing to do with these risky investments, just to find out that the company you invested in did so themselves. That being said, we should let those who made the right decisions rise to the top and be know, instead of giving money to those who made bad decisions just so they can continue to make more bad decisions.

If you want to identify who the truly greedy executives and companies are, don’t look at who the media is exposing or who congress members vilify. Look at the people that are willing to sell out the economy and the American people so save their own jobs and reputations. Instead, look to who is taking money from congress. Then look at the politicians who are giving them your money.

Do the Ends Justify the Means? Do the Means Justify the Ends? (Part 1 of 2)

We often hear the philosophical question, “Do the ends justify the Means?”. This is a difficult question to answer and probably depends on the circumstances. However, I also want to ask the opposite, “Do the means justify the ends?”.

This really ties into my earlier blog titled “The Folly of Good Intentions”.

On November 7th, the Ohio citizenry elected a new Governor, ousted an old Senator, and passed several new laws, including a state-wide smoking ban and an increase in the minimum wage.

For the first issue, the smoking ban, I ask the first question, “Do the ends justify the means?”. What are the intended ends? Although I believe some who supported this law have unjustifiable motives, I believe most hope to create an environment where non-smokers are not exposed to the negative heath aspects of second-hand smoke. With that in mind, and knowing that the reality of second-hand smoke’s effects is also questionable (http://www.davehitt.com/facts/index.html), let’s assume for the sake of argument that second-hand smoke does hurt people aside from the smoker. If so, then people should be prevented from unjustly doing harm to others in this way. Is banning smoking in all public places justifiable to prevent such effects?

Where do the rights of one person begin to interfere with the rights of others?

1) When the rights and actions of the smoker cause harm to others, the smoker has overstepped his/her right to smoke.

This makes the smoking ban seem justifiable. But before we jump to that conclusion we need to know if the smoking ban grants rights to the non-smoker in a way that interferes with the rights of the smoker.

2) A smoking ban in public places may inconvenience smokers but does not interfere with their right to partake in the legal activity of smoking.

What other people may be impacted by this action and are their rights also impeded by this ban? There are smoking supply retailers, restaurant owners, other entertainment venue owners, other ancillary businesses, and workers at each of these establishments. Let take a look at a few of these.
The smoking supply retailer can be hurt by this ban as this retailer is no longer permitted to use their own product in the store where they sell it. It may make sense to ban smoking in a large supermarket, but not in a small specialty smoking shop. Not only is every customer to enter a specialty shop likely to be a smoker, but the owner may want to make samples available for customers to try. Without the ability to compete in such a way, the small specialty shops are placed at a disadvantage to the large shops who would not allow this kind of activity. Interestingly, this scenario worked itself out without governmental intervention. Years before the smoking ban went into effect, supermarkets and large department stores banned smoking on their own so as not to offend non-smoking customers. At the same time, specialty smoking stores did not harm non-smoking customers as non-smokers did not come into their stores.

Prior to the smoking ban, most restaurants had smoking and non-smoking sections in an effort to satisfy all potential customers. Some put in state-of-the-art air filtration systems to prevent smoke and the odor of smoke from going into the non-smoking areas. However, some restaurants chose to be smoke free. Most bars allowed smoking throughout their establishments (no non-smoking sections). Entertainment facilities were varied. Some allowed smoking (like most bowling allies), some banned smoking (like indoor concert venues and placed where kids are more likely to frequent, like arcades), and others chose the path of restaurants and had smoking sections.

In this competitive and varied environment, entrepreneurs had many options to give themselves a competitive advantage. One could open a non-smoking bar to cater to potential clients who wanted to socialize, listen to band, and drink without being exposed to smoke. This allows the economic demand of the public to be met without interfering with another bar owner’s willingness to cater to the smokers and meet that economic demand. This allows entrepreneurs to create wealth for themselves by meeting the needs of others.

3) A smoking ban does interfere with the rights of business owners to be competitive in a way that does not harm people.

What about the worker who works in a smoking environment? Some people may choose to work in a smoking environment because they are smokers themselves. Others may choose to work in a non-smoking environment because they do not want to be exposed to smoke. Occasionally I hear from people who complain that they work in a smoking environment, but cannot make the same amount of money in a non-smoking environment. This is an example of a decision that must be made by free, reasonable, adult citizens. Here is a sample scenario to help illustrate my point. Restaurants A and B are across the street from each other. Both restaurants offer waiters/waitresses $10 per hour to work there. Restaurant A prohibits smoking and Restaurant B allows smoking. In this community Restaurant A has no trouble hiring the number of servers they need. Restaurant cannot find enough workers so the owner raises the wage of servers to $!2 per hour. Now both restaurants have the number of servers they need. Is an employee justified in complaining that they cannot make as much money in a non-smoking environment and demanding that restaurant B be forced to ban smoking for health reasons? No! The servers in Restaurant B are paid a differential of $2 per hour to entice them to work in the less desirable environment. If a smoking ban is put into effect, not only does it eliminate the restaurant owners ability to compete by providing a service to a portion of the population that wants to smoke, but it also eliminates the need to pay the differential. Now the owner of Restaurant B can hire servers at $10 per hour as well and probably must do so to compete with Restaurant A. Interestingly, in a different community, and restaurant owner may need to pay a higher differential to get servers to work at a non-smoking restaurant because this restaurant may get fewer customers, which results in fewer tips.

4) The smoking ban will infringe on the rights of workers by hurting their earning potential.

The owners of ancillary businesses are also hurt. For example, there is no longer a need to provide restaurants with state-of-the-art air filtration systems. These companies will now go out of business and the employees will be laid off. The work they did was legal, moral, and beneficial to smokers, non-smokers, and business owners. Now they will have their earning potential greatly reduced and may be put out of business.

5) The smoking ban reduces the earning potential of ancillary business owners and their employees.

Well, we know that a comprehensive smoking ban is intended to prevent harm. While accomplishing that goal, it also causes harm. THE MEANS DO NOT JUSTIY THE ENDS. For the means to be justifiable, it cannot cause harm, especially a harm that may be more devastating that being prevented.

So what can be done?

Simple, allow businesses to decide for themselves if they want to allow smoking or not. Make the smoking status apparent upon entering the building. Smokers can choose to go to a smoking establishment and partake in that activity. They can also choose to go to a non-smoking establishment and refrain. Non-smokers can choose to got o a non-smoking establishment and be free from smoke. They can also choose to go to a smoking establishment and put up with the smoke. Business owners can choose to cater to smokers. They can choose to cater to non-smokers. They can also choose to try to cater to both with smoking and non-smoking sections. This allows all to have the freedom to make their own decisions as adults and live with the consequences or benefits of their decisions.

All get what they want…unless the real goal was not really to prevent harm. Hmmmmm.

Part 2 will be on the minimum wage increase.

The Ultimate Tax Plan

Many of us complain about taxes. Usually we complain about federal taxes, but state and local taxes are also burdensome. Approximately 32% of my income goes to some form of tax. This includes federal income tax, state income tax, local income tax, Social Security tax, Medicare/Medicaid tax, sales tax, etc. This does not include other taxes that I know I am also paying, but cannot easily determine how much, like cell phone taxes, gasoline taxes, tariffs, etc. Let’s just assume all inclusive would be about 1/3 of my income.

Unhappy about what I believe is a very burdensome tax rate, especially since I don’t get paid much as an employee of a non-profit organization, I have developed some tax plan options. Some are realistic, some are not. The one I propose her is the best plan. It is the fairest plan. It is one of the unrealistic planes because I don’t believe that this could ever get passed in the legislature.

I don’t promote the idea of a flat tax, although it is still far better than what we have now and may be the best possible plan that we could get passed in congress.

In 2005 the federal expenditures were $2,470,000,000,000 ($2.47 trillion). I’m sure the budget is larger this year, but I’m not sure exactly how much, but I’ll use this number for reference. The US population this year exceeded 300,000,000 (300 million).

Here is the simplest budget you will find. I use the formula
(budgeted expenditures)/(population)=individual taxes

In other words, take the expenditures of $2.47 trillion and divide by the number of citizens (300 million). This equals $8,233.33 per person.

All citizens get the same constitutional guarantees and should receive the same benefit from their association. Therefore, the costs should be distributed equally. No one expects people with higher incomes to pay more to watch a movie. All ticket purchasers pay the same price. The same should go for paying for government.

Right now those that contribute the least receive the most benefit. What do you think?

The Folly of Good Intentions

It is melancholy to reflect that Mankind has suffered more from ill-judged philanthropy than [from] calculated malice. The road to Hell is no less harrowing for being paved with good intentions.
-Giles St. Aubyn, biography of King Edward VII

Many question the wisdom of personal charity. Should I give to the man on the street who asks for money? Will he use it to buy drugs or alcohol? Is it really helping him at all, even if he buys food with it? Is my charity just enabling him to stay in this condition? These are all serious questions and serious issues to be addressed. As one can imagine, different people might come to different conclusions. Opinions get even more diverse as we each decide which charities most need our financial assistance and our volunteer time.

Of course, I wouldn’t want to bring up something so controversial if I didn’t have a solution. Here is my suggestion:

First, we all know how important it is to give to charity. We should all take a certain percentage of our pay and set it aside for charity. Since we all have a responsibility to look after each other and we could all end up in need of charity at some point in our lives, this should be mandatory. Likewise, so as not to unduly burden one person or family over another, this should be a set percentage by which all must abide. For the sake of this example, let’s suggest 10%. This may not be the actual ideal amount, but it works for our discussion. We collect all this money and put it in a pool.

Next, we put together a committee to review all the possible ways that these charitable funds should be spent. The committee could take input from those donating money and listen to the pleas of the charitable organizations. This would be beneficial because it would let those on the committee know where the donors would like their money spent and it would allow the committee members to understand the needs of those out there doing the charitable work. Then with careful analysis and wise discernment, the committee would decide how the money will be spent

You may disagree on the decisions of the committee, but the committee will base their decision on the input of everyone. If you think money should go to an organization that the committee has ignored, you are welcome to donate additional funds to that organization. Also, if you make your case to the committee, they can redirect some of the funds to the organizations that you support. The problem is there are so many good organizations that are really working to help alleviate societal problems and many people will want to support more organizations. I suggest that if there organizations that need funding and seem to be crucial to meeting our goals as a society that the committee should be able to increase our required allotment of funds.

Another benefit of this is that the organizations being funded will no longer need to spend time, effort, and money making their case to all of us and developing fund-raisers when they can just go to the committee and state their need. Even more importantly, if they can’t convince the people in general of the virtue of their cause, they can still convince the committee.

What a great solution. I am so proud of myself for coming up with such an ingenious way to address the serious issues of philanthropy in today’s society. With this solution put into action, I am sure we will have almost all of society’s woes cures in short order.

The best part of this is that it relieves all of us from the need to spend time trying to decide where best to spend our charitable contributions.

Of course there is one small problem. What if the committee decides to distribute funds to an organization whose goals you disagree with? This is different than not funding some organization you want to support; this is supporting an organization or issue that you find objectionable. Can you direct the committee to forward your donations only the organizations that you support? Of course not, that would be a break down of the whole system. That would defeat the purpose of developing the committee to begin with. Now, against your will, the money that you have worked hard for will be distributed to support ideas that fly in the face of what you believe to be right, just, and good. Some of the money doesn’t even get distributed to any charity because it must be used to financially support the committee’s costs in maintaining, enforcing, and managing the entire system. That’s not fair! Can someone really take the money I earn and give it to others without my permission? Yes. Can I opt out? No. Can I change the system? You can try. Will I have opposition? Much.

When you try to change the system, you will find resistance on many fronts. Those receiving your charitable funds won’t want you to risk losing the financial support that you provide. Those receiving the benefits of the work of the charitable organizations won’t want to lose the benefits of your financial support. Finally, those on the committee and their related staffs that support the system we developed won’t want you to opt out because their jobs may be on the line, along with the support they receive from the recipients of your funds.

The worst part is that you have no power to opt out because you gave the committee the power to enforce the mandatory donations to make sure that your neighbors would give their fair share as well. In the end, those groups that you find objectionable continue to grow with your financial support. Those that you prefer to support may be struggling and you don’t have the ability to donate any more to help them. Those that you prefer to support may also be prospering, but you can be assured it is at the expense of someone else who is as frustrated as you.

Now you feel trapped. How can I change the system? How can I get out?

The only way to get out is to move away. The only way to change the system is to forcefully overthrow the committee and the whole system or reappoint committee members that support your desires to make changes. These changes can come in two forms. You can select committee members that support or oppose the same charitable organizations as you to help assure that your funds are going to where you want them to go. This works well for you, but only at the expense of those who disagree with you and want to support the organizations that you oppose. What then can we do to make the system fair for all? I recommend selecting committee members that will dismantle the entire forced charity system and leave it up to each one of us to donate or not donate as our conscious directs. We can donate how ever much we want to whatever organizations or people that we want and they will benefit with 100% or the proceeds that we donate without losing a percentage to support the bureaucracy that distributed the money that you could have distributed on your own.

Let’s face it, when one person or organization comes to the government to get tax support, they are asking the government to do what they cannot legally do on their own. They are using the coercive power of the government to take your property for their own use. Without government support, this would be called robbery. It’s just masked by the legal authority we have given to our politicians to do so with the guise that it for the good of society or the country. Conservatives want to use our money to support certain causes and organizations. Liberals want to use our money to support other causes and organizations.

It is far better for the government to leave up to us what we consider to be the best use of our money.

Imagine if the government demanded of us 10% of out time and assigned to us what our politicians and bureaucrats thought was the best use of our time. Would we stand for that? This confiscation of our time and knowledge and energy has been done in the past, it was called the draft.

Let’s get government out of the charity business and take on the responsibility that should lie in our own laps. It is our responsibility to be the stewards of our world and we should not try to pawn off this responsibility on others, even a government that is supposed to represent us. Nor should we have the right or responsibility to take from others so that we can use their resources how we see fit.

Now, back to the man on the street. Should you give him money? Should you give him food? That’s up to you. It’s your responsibility to decide. The best part is that on a local level, you can often see if what you are doing is helping or hurting. Not only is it up to you what to do, but you have the power to change your mind as you see fit. Doesn’t that feel good?

2 Corinthians 9:7
Each man should give what he has decided in his heart to give, not reluctantly or under compulsion, for God loves a cheerful giver.