Thursday, October 8, 2015

SOMETHING FOR EVERYBODY EQUALS NOTHING



Money does not grow on trees although nowadays governments, - social do goers, as well as unionists believe that the paper which comes from the wood of trees on which a sum is printed has a true stated value.
  
From local governments to the federal level there is an increasing demand for services and broader benefits.

It is axiomatic that nothing comes for free, therefore every expenditure at all levels of governments has to be paid for, This could be done by matching costs with taxes  Politically that is a deadly action that would result in not getting reelected.

There are several ways of circumventing tax raises. One is to cut or skimp on essential needs including not maintain the inner structure. This is popular and we see the results in structure failures including bridges, roadways underground utilities such as water and sewer mains.

We also see that course affecting our foreign policy with a weakened military in numbers and in ageing out of date equipment contributing to a loss of the deterrent factor.

Another and popular one in Washington is to continually raising the debt level which mortgages the future and ultimately will become so great that the economy will collapse due to an inability to meet its obligation. That is national bankruptcy as has happened in Greece and several other European countries that have had extensive social benefits program.

This of course will wipe out savings especially the elderly’s retirement nest eggs. Making them destitute. Since our present political do gooders will not be affected they have no compunction to stop giving away the farm.
The basic value of a dollar is determined from what a “work unit” is worth. The increasing printing of paper money cause a decrease on the value of the currency, which is the cause for inflation. That is why prices rise every year so that the 17 cent gallon of gas in 1946 is now between 2 and 3 dollars. An average increase of about 1470% . Or the doctor’s office visit of 2 or 3 dollars in the late 40s for a simple one is now over $75 or over 2000%. The 3 cent postage stamp now costs 49 /cents a 1633% increase. Or when in the early 50s $100 a week income was  riches, or about $5000.00 a year; and the daily goodwork wage was about $10.00; today’s poverty level is $24.250.00 for a family of four. That is about$65 a day or a 650% increase to escape poverty.


That is inflation not a better life because one is earning more. As I noted some of the real victims are those who’s savings were going to carry them over after retirement but have lost most of their value.

Other contributors to inflation are annual cost of living raises which creates a viscous cycle. Increasing the minimum wage increase the cost of a product or service which is reflect on the charges to the consumer. Once again that is self-defeating due to the lowering of the value of the dollar based on the unit costs.

We cannot continue to raise the debt ceiling and give away more substance freely without ultimately making our dollar worthless. It is time to balance realities against desires. It is time to focus on essentials rather than seeing that everyone has everything. Socialism is idealistic but unfortunately it is ultimately the death knell of a society due to economic collapse.

In the future I will comment on  the impact of the ACA on our economy and our healthcare.

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