No matter what you believe about taxes and how those should be changed, I certainly hope that you agree that it’s not the main issue we should be tackling right now. I’m fines taxes rising somewhat as they did even though taxing the wealthy is not nearly as effective as some would think. What I don’t get is why we’re not even trying to fix what’s really wrong.
-Tax reform: Biggest issue is not that rates are too low… in fact they’re way too high. But having a tax code that makes thousands of exceptions for individuals and companies that are able to lobby for them is not helping the overall economy. Raising tax rates IS NOT the way to go, even if you’re trying to increase revenues.
-Defense: I’m not saying that spending here should be drastically reduced. But do we need to have more spending than the next 20 nations combined? And even if we did, wouldn’t cutting just a bit help us spend in a smarter way?
-Entitlements: This is absolutely huge.. just take a look at this chart:
Seriously, the fact that Obama, and both Republicans and Democrats aren’t able to tackle this is a huge problem. I understand that politics are involved but that shouldn’t prevent us from moving on those. Entitlement programs are NOT SUSTAINABLE. They cannot keep being managed as they currently are. However, because both parties fear the political cost, they discuss it but have no clear plan to overhaul these programs. Social security, medicare, Medicaid/Obamacare are all great programs but ones that the government cannot continue to fund in their current forms. Everyone who’s looked at the numbers agrees on this. Every single person. Do you know what they also agree on? That the longer we wait, the more difficult it will be to fix the problem.
Telling the country that raising taxes on the rich must be done is an easy thing to do because it’s a popular measure. Telling them that the benefits they have been promised cannot be fulfilled and must be changed requires courage and thinking about the country first instead of the next election.Democracy’s Biggest Weakness?
Unfortunately, this problem is occurring in most advanced countries where politicians have very little incentive to fix long term problems because it has a short term political cost. This has been making governments ineffective and I wish I could say there was an easy solution but I don’t see it. Why should we wait until our country is steps away from going bankrupt if we could start reforming now?
credit: http://www.heritage.org/research/reports/2012/10/federal-spending-by-the-numbers-2012We Had A Golden Opportunity
The recent fiscal cliff face-off was as good of an opportunity as you could possibly get. Both parties HAD to negotiate; we forced to look into different ways. I was watching NBC’s Meet The Press last week and they were talking about how they only worked on the easy stuff. That is exactly how I feel. So if such a cliff, right after a presidential election (when no party is “supposed” to be preparing for the next election) is not a good sign. There will be another (probably bigger) face-off at the end of February which will also include a debt limit standoff so there will be another opportunity. The problem is that no one seems to even hope for bigger issues to be tackled at this point so I don’t know when those will be addressed.Do You Feel The Same Way?
I’m generally an optimist but I don’t see how or who would start tackling these issues in a bipartisan way (both parties would need to do so), how about you?What This Means?
If you take a look at what has happened in countries that have gone through this (and failed to fix the issues), a major consequence has been governments making significant changes that affect all citizens. That is one more reason for me to work on my passive income flows to remain as independent as possible from whatever pension and services that are currently offered. What about you?