Almost everyone is aware of the raging debate over abortion in America. The country is divided along scientific, moral, ethical, gender and other boundaries. So I thought I'd jump into the discussion.
I'll start by saying that I am completely opposed to abortion. But having said that I want to present a different view about Choice.
People who do not oppose abortion use the label of "Pro-Choice" to identify themselves. Those who oppose abortion describe themselves as "Pro-Life". As a person, I completely enjoy the freedoms of choice we have in the US. That being said, let's explore the Choices...
The US Declaration of Independence (corrected) provides every US citizen the right to 'life, liberty, and the pursuit of happiness'. Of course there is more to the freedoms defined in the Declaration (same correction), the US Constitution and the Constitutional Amendments, but let's start there for now.
As a child, parents or guardians establish rules or limits by which we are expected to behave. We choose, daily (sometimes hourly) to live within those rules or to break them. In school, we are presented another choice: study, learn, succeed or not. Assuming we make it to high school, we are faced with another choice: College, Job, or whatever. Around the same time, we are faced with choosing who to hang out with, who to date, whether or not to drink or take drugs or have sex. As a young adult, we are faced with choosing to pay our bills or not. Buy or rent? There are literally thousands of choices we make in our lives! In America, we are guaranteed the right to make those choices. So you might say I am pro-choice on all these topics.
I am, without doubt, pro-responsibility. You guessed it, if we enjoy the freedoms to make choices, then we must be responsible for the outcomes of those choices. If I choose to not pay attention in class, then I (and only I) am responsible for my poor grade. If I choose to skip work repeatedly, then I am responsible for getting fired. If I drink and drive, then I am responsible for the damage done, life lost, etc. resulting from my drinking. Likewise, if I choose to have sex and a pregnancy results from that choice, then I am now responsible for the pregnancy. So do I support a woman's right to choose? You bet, but I put the decision point earlier in the process. A woman's right to choose is before she has sex.
I am all for the right to choose...I want the right to choose where my children attend school (including homeschooling if my family so chooses)...I want the right to invest the money I earn in any way I choose to...I want the right to choose to get a job or go to college...I want the right to choose whom to marry...the right to choose where we go on vacation...the right to choose my friends...the right to choose my faith...the right to choose where I eat...and the right to choose with whom I have sexual relationships. But when exercising my rights limits another person's right to life, liberty or the pursuit of happiness, or in some other way interferes with their freedoms, that is where my rights end.
I do not have the right to end another person's life, even if that person is unborn. We as Americans enjoy a truckload of rights and freedoms, I suggest that we use all of them but remember, choose wisely. And be responsible for our choices.
10.29.2008
10.22.2008
Who Can Afford More Taxes?
Today, many politicians and commentators routinely say that people who earn more than some magic number each year 'can afford to pay more taxes than those who earn less'. This article does not address the error in this thinking. For that discussion, see my article titled Robin Hood Tax Strategies. This article focuses on the statement itself and anyone's authority to make such a statement.
Maybe I did not introduce this topic correctly, but I'll just dive right in.
I work very hard to earn the salary that I receive. I need as much of it as possible to pay for the lifestyle that my family and I live. We are not living extravagantly! However, our budget is extremely tight. We own two vehicles (yes I mean OWN, they are both paid in full). The first vehicle is a 1994 Chevy Pickup (maximum capacity: 3) and our family vehicle is a 2002 Dodge Durango (maximum capacity: 7). Our family consists of my wife and I, and our 4 kids. That makes 6 total and as you might have guessed, we can only use the Durango when we go anywhere together. We do not have a video game console in our house (update: as of Christmas 2008, we now have a game system...bought on sale). We do not have a flat panel (LCD or Plasma) TV. We do not own a boat. We have taken very few family vacations in our 14 year marriage (Mertle Beach, Gatlinbutg, and Destin). We buy clothes at local consignment shops or at end of season sales for the following year. Speaking of clothing, we buy very little name brand clothes or shoes. We have three girls and pass down as much clothing as possible. I think you get the picture, but to recap, we are quite frugal with our finances. Although I make a good salary as a Manager at an Automotive Industry Supplier, we have to work very hard to survive financially.
As a side note, we have a small savings account and I mean small. I have a 401k through my company, but my wife has no retirement fund at all. We planned to build savings accounts for each child, but have not been able to start and grow any such account. Also note, our debt load is not increasing, but it is not decreasing either (update: after completing Dave Ramsey's Financial Peace University, we can proudly say that we are now Tithing, Budgeting, Paying Down Our Debt, and Soon to be DEBT FREE!).
The absolute best financial thing that could happen for my family is for my tax load to drop. I pay roughly 25% of every dollar to some tax bureaucracy. If I paid less tax dollars, I would have more to spend on items for my family, put into savings, plan for retirement, etc. I don't think we are any different from most American families.
I have heard several politicians lately using phrases like redistribution of wealth, spread the wealth around, and "they can afford to pay more taxes". These phrases disturb me to the core. You see, I don't understand why any politician thinks that it is their duty, obligation, or otherwise to manage the wealth of the people of this nation. The Federal Government is established by the U.S. Constitution as a government by the people, of the people, for the people. One of the Federal Government's primary obligations is to fulfill the role defined in the U.S. Constitution and to protect the rights of U.S. Citizens including life, liberty, and the pursuit of happiness as written in the U.S. Declaration of Independence. Outside of that, I think the Federal Government has overstepped it's designed intent. In other words, it is not any politician's job to tell me or anyone else how much tax we can afford!
Only I and my family can rightfully decide what we can or cannot afford. If someone can truly afford to pay higher taxes, and has the desire to contribute more to the National Balance Sheet, then I suggest that they write a check and put it in the mail. But leave the rest of us alone! We work to support our families. The less money we pay in taxes, the more we keep to provide for our families. I'll go back to what I just wrote; I work to support my family not the Federal Government. If the Government needs more money to balance it's books, then I suggest that Politicians do what families do, spend less. Cut needless programs. Reduce spending on projects that do not support the fundamentals required by our Constitution.
Maybe I did not introduce this topic correctly, but I'll just dive right in.
I work very hard to earn the salary that I receive. I need as much of it as possible to pay for the lifestyle that my family and I live. We are not living extravagantly! However, our budget is extremely tight. We own two vehicles (yes I mean OWN, they are both paid in full). The first vehicle is a 1994 Chevy Pickup (maximum capacity: 3) and our family vehicle is a 2002 Dodge Durango (maximum capacity: 7). Our family consists of my wife and I, and our 4 kids. That makes 6 total and as you might have guessed, we can only use the Durango when we go anywhere together. We do not have a video game console in our house (update: as of Christmas 2008, we now have a game system...bought on sale). We do not have a flat panel (LCD or Plasma) TV. We do not own a boat. We have taken very few family vacations in our 14 year marriage (Mertle Beach, Gatlinbutg, and Destin). We buy clothes at local consignment shops or at end of season sales for the following year. Speaking of clothing, we buy very little name brand clothes or shoes. We have three girls and pass down as much clothing as possible. I think you get the picture, but to recap, we are quite frugal with our finances. Although I make a good salary as a Manager at an Automotive Industry Supplier, we have to work very hard to survive financially.
As a side note, we have a small savings account and I mean small. I have a 401k through my company, but my wife has no retirement fund at all. We planned to build savings accounts for each child, but have not been able to start and grow any such account. Also note, our debt load is not increasing, but it is not decreasing either (update: after completing Dave Ramsey's Financial Peace University, we can proudly say that we are now Tithing, Budgeting, Paying Down Our Debt, and Soon to be DEBT FREE!).
The absolute best financial thing that could happen for my family is for my tax load to drop. I pay roughly 25% of every dollar to some tax bureaucracy. If I paid less tax dollars, I would have more to spend on items for my family, put into savings, plan for retirement, etc. I don't think we are any different from most American families.
I have heard several politicians lately using phrases like redistribution of wealth, spread the wealth around, and "they can afford to pay more taxes". These phrases disturb me to the core. You see, I don't understand why any politician thinks that it is their duty, obligation, or otherwise to manage the wealth of the people of this nation. The Federal Government is established by the U.S. Constitution as a government by the people, of the people, for the people. One of the Federal Government's primary obligations is to fulfill the role defined in the U.S. Constitution and to protect the rights of U.S. Citizens including life, liberty, and the pursuit of happiness as written in the U.S. Declaration of Independence. Outside of that, I think the Federal Government has overstepped it's designed intent. In other words, it is not any politician's job to tell me or anyone else how much tax we can afford!
Only I and my family can rightfully decide what we can or cannot afford. If someone can truly afford to pay higher taxes, and has the desire to contribute more to the National Balance Sheet, then I suggest that they write a check and put it in the mail. But leave the rest of us alone! We work to support our families. The less money we pay in taxes, the more we keep to provide for our families. I'll go back to what I just wrote; I work to support my family not the Federal Government. If the Government needs more money to balance it's books, then I suggest that Politicians do what families do, spend less. Cut needless programs. Reduce spending on projects that do not support the fundamentals required by our Constitution.
10.03.2008
Robin Hood Tax Strategies
I'll start by saying that I don't like paying taxes and don't know anyone who does. I think that the less I pay in taxes (local, state, or federal) the better things are for my family.
That being said, there is an overwhelming desire to tax "the rich people and big corporations" while giving tax breaks to the middle income earners and the poor of our society. The thought goes like this: The rich people have enough money to afford to pay higher taxes, so let's raise their tax percent (liability) and leave the rest of us alone or give us a tax percent reduction. While we're at it, let's increase the tax percent on large corporations, because we all know they are making obscene amounts of profit anyway. They can afford it. Just like Robin Hood: take it from the rich and give it to the poor.
This sounds great on the surface. But in the free market society that has made the United States so successful this just doesn't hold water. In fact, let's use water as an example. We are all part of the American Economy. We are financially dependent on each other. We all work for someone, have employees, make a product, offer a service, buy things, etc. Think of the water in a bath tub. Even the slightest disturbance at any point in the tub results in ripples (effects) that cover the entire tub. If you open the drain (at one location in the tub) the water level lowers in the entire tub. If you turn the water on and add water at one end, the water level raises across the whole tub. Our economy, and specifically, taxes are very similar.
Let's look at a simple example: if I own a business that produces some product and my material costs go up (for any reason) or my tax liability increases, I have a choice to make with only a few options. Do nothing and make lower profits. Cut costs in other areas of the business. Raise the sale price of my product. I could take a combination approach by cutting some costs, increasing the sale price and accepting lower profits all to a lesser degree that with a singular approach. Let's explore these options a bit.
Do nothing and make lower profits.
If my company makes less profit, bad things can start to happen. Small businesses may have to delay purchasing new equipment. This may lead to a technology gap with my competitors making it more difficult to compete for new business. I may not have enough profit to hire additional people to help better distribute and sell my product. I also may not be able to give my employees a raise this year. This could lead some of them to look for better salaries at other companies. There are many other effects, but let's sum these up: No technological improvements, no expanded ability to grow my sales, no ability to reward my workforce resulting in many leaving to seek higher paying jobs.
Cut costs in other areas of the business.
Often when companies face tough economic times, they try to cut costs. In my example above, let's suppose I cut office supplies spending. I could also cut travel budgets. I would likely critique every non-business-critical expense like employee activities (picnics, bar-b-ques, softball teams, golf tournaments, professional memberships). I would also postpone or cancel any refurbishment of equipment and facilities. So in this strategy, my company ends up using old, deteriorating office equipment (desks, chairs, computers, etc) that will likely not impress any potential customer and limit our ability to secure new sales. My sales team would not be able to pursue new sales as effectively with little or no travle budget. With the lack of employee related activities, the workforce feels unimportant to the management team and productivity slips. As manufacturing equipment ages it is more likely to break down and require significanly more to repair or result in loss of capacity to produce our product. At the same time, our building and property are starting to look unkept and may disuade potential customers from considering us for business.
Raise the sale price of the product.
The third basic strategy would be to simply raise the sale price of the product. This directly impacts our customers financially. If the customer base is 'captive' then this strategy may be successful, but if our competitors do not impose the same price increase, then the customer is likely to purchase the product elsewhere. This results in a loss of sales and operating income for our company. Let's assume for a minute that the customers cannot get this same product from any other source or that all producers similarly raise the sale price on their products. The customer base then bares the total weight of the increase in tax burden that was originally imposed on our company. If our product is a consumer item (TV, cars, Ipods, food, clothing, etc.) then the general buying public (you and me a.k.a. the middle and low income population) are forced to pay more for items that we need or want.
In this simple example, the end result of any increase of tax burden results in potentially catastrophic effects on all levels of our society. Thus, my comparison to the bath tub holds true. If you raise the tax burden on any part of the economy, the entire economy is effected. Tax the rich and big companies and we all pay in some way. Raise taxes on anyone and we all take a bath!
That being said, there is an overwhelming desire to tax "the rich people and big corporations" while giving tax breaks to the middle income earners and the poor of our society. The thought goes like this: The rich people have enough money to afford to pay higher taxes, so let's raise their tax percent (liability) and leave the rest of us alone or give us a tax percent reduction. While we're at it, let's increase the tax percent on large corporations, because we all know they are making obscene amounts of profit anyway. They can afford it. Just like Robin Hood: take it from the rich and give it to the poor.
This sounds great on the surface. But in the free market society that has made the United States so successful this just doesn't hold water. In fact, let's use water as an example. We are all part of the American Economy. We are financially dependent on each other. We all work for someone, have employees, make a product, offer a service, buy things, etc. Think of the water in a bath tub. Even the slightest disturbance at any point in the tub results in ripples (effects) that cover the entire tub. If you open the drain (at one location in the tub) the water level lowers in the entire tub. If you turn the water on and add water at one end, the water level raises across the whole tub. Our economy, and specifically, taxes are very similar.
Let's look at a simple example: if I own a business that produces some product and my material costs go up (for any reason) or my tax liability increases, I have a choice to make with only a few options. Do nothing and make lower profits. Cut costs in other areas of the business. Raise the sale price of my product. I could take a combination approach by cutting some costs, increasing the sale price and accepting lower profits all to a lesser degree that with a singular approach. Let's explore these options a bit.
Do nothing and make lower profits.
If my company makes less profit, bad things can start to happen. Small businesses may have to delay purchasing new equipment. This may lead to a technology gap with my competitors making it more difficult to compete for new business. I may not have enough profit to hire additional people to help better distribute and sell my product. I also may not be able to give my employees a raise this year. This could lead some of them to look for better salaries at other companies. There are many other effects, but let's sum these up: No technological improvements, no expanded ability to grow my sales, no ability to reward my workforce resulting in many leaving to seek higher paying jobs.
Cut costs in other areas of the business.
Often when companies face tough economic times, they try to cut costs. In my example above, let's suppose I cut office supplies spending. I could also cut travel budgets. I would likely critique every non-business-critical expense like employee activities (picnics, bar-b-ques, softball teams, golf tournaments, professional memberships). I would also postpone or cancel any refurbishment of equipment and facilities. So in this strategy, my company ends up using old, deteriorating office equipment (desks, chairs, computers, etc) that will likely not impress any potential customer and limit our ability to secure new sales. My sales team would not be able to pursue new sales as effectively with little or no travle budget. With the lack of employee related activities, the workforce feels unimportant to the management team and productivity slips. As manufacturing equipment ages it is more likely to break down and require significanly more to repair or result in loss of capacity to produce our product. At the same time, our building and property are starting to look unkept and may disuade potential customers from considering us for business.
Raise the sale price of the product.
The third basic strategy would be to simply raise the sale price of the product. This directly impacts our customers financially. If the customer base is 'captive' then this strategy may be successful, but if our competitors do not impose the same price increase, then the customer is likely to purchase the product elsewhere. This results in a loss of sales and operating income for our company. Let's assume for a minute that the customers cannot get this same product from any other source or that all producers similarly raise the sale price on their products. The customer base then bares the total weight of the increase in tax burden that was originally imposed on our company. If our product is a consumer item (TV, cars, Ipods, food, clothing, etc.) then the general buying public (you and me a.k.a. the middle and low income population) are forced to pay more for items that we need or want.
In this simple example, the end result of any increase of tax burden results in potentially catastrophic effects on all levels of our society. Thus, my comparison to the bath tub holds true. If you raise the tax burden on any part of the economy, the entire economy is effected. Tax the rich and big companies and we all pay in some way. Raise taxes on anyone and we all take a bath!
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