“The historic average for federal government revenues over the past 40 years is between 18 and 19 percent of nominal GDP. For 2011, federal government spending is projected at 25 percent of GDP, a post-WWII record, with a $1.65 trillion projected deficit. The key debate is about how the budget gap will be closed.” – Joseph T. Keating, Chief Investment Officer, Center State Bank
The 2012 election will be a philosophical tipping point of how we operate government for many decades to come. If we increase the tax revenue base to 25 percent of GDP, the U.S. will become “a high tax, slow growth, European-style entitlement state, which would fundamentally change the foundation of private sector driven capitalism upon which our economy has been based,” said Keating.
You will vote in November to collect and spend 18 percent, or you will vote to allow the government to increase the tax base to 25 percent and continue the current spending rate. Think seriously about all the consequences of your decision.
Something to Think About
Our Founding Fathers fled from England and fought for our freedom to avoid excessive taxes and religious restrictions. Yet, here we sit in 2012 ready to give our government permission to return to a tyranny of taxes and restrictions. We are actually considering a vote to return to the very bondage we escaped from. I guess the Bible was right when it said, “A dog will return to its vomit.”
America was discovered to provide opportunity for all people who desired to take advantage of it with hard work and perseverance. You are entitled to only “life, liberty and the pursuit of happiness,” and government was established to protect these virtues, not provide them. A “pursuit” is an on-going journey, not a destination.
The mystifying question to me is why do we think this path of 25 percent has any hope of providing prosperity?
Prosperity for All or Power for Some
For years our system of opportunity has worked quite well, making America the envy of the entire world. Today, we actually have individuals who have gathered great wealth because of our system, who now speak of more taxes and bigger government, thus decreasing the opportunities for others. Though I do not know all of these folks personally, I do know that self-preservation and power are significant human motivators; these same people will be gaining more power and eliminating the competition – YOU!
We have Europe to thank for a perfect example of why this system of taxing does not work. Europe is in total shambles (study Ireland and Greece) yet we have political leaders (sorry, “leader” is a bad word; what we have are political “people”) who want to copy the European system.
For the past three years, the current government has spent at a record pace for the benefit of the poor and middle class. So why are they worse off? The rich are still rich. You are not going to tax the rich and create prosperity for the poor – what you are going to do is stop the wealthy from spending or investing into companies or opportunities that provide income, prosperity and opportunity for others. The truly wealthy of our country obtained their status by building it with hard work and perseverance. Then they inspired the same opportunity in others. That is the true spirit of our country.
The Stages of Life
Businessman, entrepreneur and multi-millionaire Rich Devos identified the following four stages in the life of a business:
- Build, Create and Develop – This is where you need to be
- Defender of No Growth
- Blame – This is where we are today
As a society, we have moved into stage 4, the Blame Stage. There is no personal accountability; instead it is someone else’s fault for my current situation. Real leaders do not blame others for the situation – is our government a group of leaders or blamers?
Here are three simple constitutional amendments that would keep our country strong and provide opportunity for everyone.
- Balanced budget amendment to 18 percent of GDP;
- Term limits for Congress;
- Campaign reform so that no special interest groups can buy your representative. All candidates get the same amount of money; the Internet and TV provide equal opportunity for all.
If you vote for 25 percent, remember when you wake up one day without HOPE, just look in the mirror to understand why.