How the Government Takes, Spends, and Wastes Your Money
There's a better way to use $7,900,000,000,000 per year
“Taxation is theft!”
So say far-right hyper-individualist libertarians.
“Taxation is justice!”
So say far-left champagne socialists.
Of course, they’re both sort of right and sort of wrong:
Taxation is indeed based on force and coercion — don’t pay your taxes and the government will seize your stuff and toss you in jail.
Taxation can also be based on fairness — all the land that was once common has been monopolized (privatized) and resourceless people have no choice but to endure wealth suppression under wage serfdom, so some taxation seeks to address this fundamental injustice via very messy, corrupt, and inefficient redistribution.
In an ideal world, we wouldn’t need taxation because
a.) there wouldn’t be any systemic economic injustice and therefore no need for redistribution, and
b.) people would see the immense common sense in pooling a portion of their resources for collective projects like highways and schools and hospitals.
If only common sense and sharing power were anywhere in humanity’s top, say, 800 defining characteristics…
So, we’re forever stuck with death, taxes, and apparently Taylor Swift and the Kardashians.
How does taxation in America work?
Not very well!
Last year, the U.S. federal government collected a cool $4.4 trillion.
That’s $4,400,000,000,000.
That’s 4.4 million millions.
Who is forced to pay all this tax?
You, mostly.
50% ($2.2T) comes from taxing your income.
36% ($1.6T) comes from taxing your income, but they call it “Federal Insurance Contributions” so people don’t start another revolution.
A measly 9% ($0.4T) comes from taxing the profits corporations made off the backs of their workers (so… you again.)
The remaining 4% ($0.2T) comes from other random taxes.
So, the big bad government hoovers in $4.4 trillion per year.
Then do they spend $4.4 trillion, or perhaps a little bit less for safe-keeping?
Oh heavens no.
They spend…
Wait for…
…this is the delicious part where the faces of right-wingers melt like Cheese Whiz in the sun…
The U.S. government rakes in $4.4 trillion and then spends…
$6.1 trillion.
(It’s actually worse — $6.1 trillion is just the cash outlays. When you include net costs like the net present value of federal employee retirement benefits, that number rises to $7.9 trillion.)
How does the U.S. government spend all your tax money?
Not very well!
$1.7T goes to healthcare (IE Medicare, Medicaid, etc)
$1.5T goes to veterans affairs
$1.4T goes to social security
$1T goes to national defense
Treasury takes a baffling $300 billion for doing nothing, while agriculture (which keeps us all alive) only gets $200 billion.
13% goes to everything else like education, transportation, the environment, and ensuring your screen-addicted pre-teen can legally identify as a cat (pronouns: Me/meow.)
But worst of all, an appalling $700 billion is spent on interest on the federal debt.
Okay, so the Feds took in $4.4 trillion and spent $6.1 trillion against $7.9 trillion in net costs.
That’s a budget deficit of $1.7 trillion.
Where does the government get that money?
It borrows the money.
How your elite-corrupted government is destroying America
To fund its massive shortfall, homicidal politicians do exactly what their corporate sponsors tell them to do — sell Treasury securities, bonds, and bills.
Fifty years ago, the federal government owed less than $0.5T. Today, Americans are on the hook for $36 trillion.
You have absolutely zero say in the matter.
Every day, your corrupt politicians borrow another $4.6 billion from their banker buddies, so you and your kids can pay them back with interest.
Then they force you to foot the bill.
They do this in several ways:
Slashing your public services.
Selling off your public assets to their corporate buddies at firesale prices.
Raise your taxes.
Stealth-tax you by increasing the money supply to rob your purchasing power. This is the biggest way they’re making you pay the national debt — by inflating the money supply, you have to work harder to purchase the same amount of stuff. It’s time theft, and it’s what created thousands of billions, dozens of trillion-dollar banks, and a handful of deca-trillion-dollar hedge funds.
How to balance the budget
This is the part where the old corrupt establishment elites and their sycophants offer the sheeple a wicked false trichotomy:
How should we fund government spending — raise taxes, cut spending, or borrow the money?
Raising taxes destroys private wealth, growth, and the incentives to work and contribute new useable wealth and value to society. (Of course, the taxes being raised are always off the poor and working-class — taxing multinational corporations and billionaires is “unthinkable” and “impossible.”)
Cutting spending decimates public well-being, as pensioners, the poor, kids, and working people see their services destroyed or corporatized for massive private profits. Dreaded austerity. (Of course, cutting spending on bank bailouts, corporate subsidies, and fat contracts to arms manufacturers are “unthinkable” and “impossible.”)
Borrowing money enslaves future generations to the moneylenders and their shareholders. (This is the free money button politicians love to push.)
But there is a fourth option, and it is the only moral and sensible one: sovereign money.
Sovereign money
Sovereign money has the power to unleash growth and prosperity in the real economy; to decentralize power away from the state and the elites; to end the evils of inflation that rob purchasing power and pillage human time; to decimate poverty; to get the nation out of debt; to build a wealth-based economy instead of a debt-based economy.
The fact that not a single politician in any Western nation is discussing sovereign money gives you an idea of how wretchedly elite-controlled our sham democracies have become.
Here’s how it works:
First, abolish the private banking cartel’s ability to inflate our money supply by printing money out of thin air.
A democratic Treasury creates debt-free sovereign money to invest via a sovereign wealth fund solely in creating new commons assets like, say, 10 million new hyper-affordable homes.
The sovereign wealth fund then sells the houses to owner-occupiers at cost on a zero-profit “rent-to-own” basis. This way, no one needs to go into debt to own a home, and no new money has to be created to lend to them.
As the sovereign wealth fund is repaid by home buyers, it destroys the money. Net zero new money + more assets = exploding well-being.
We could do the same thing to chop energy bills in half, by creating sovereign money to invest in building renewable power.
We could do the same thing to fund new highways, new high-speed railways, new canals, new tunnels — any new asset that can earn an income.
The old, corrupt, debt-based economic model:
Let private banks inflate the money supply by printing money out of thin air and lending it to the government to be repaid by the taxpayers with interest.
The next wealth-based economic model:
Democracy creates debt-free money to create new assets and then destroys the money to ensure inflation-free real wealth growth for all.
Just taxation
Once the money-creation problem is sorted and we’re saving nearly a trillion a year in wasted interest payments, we must focus on reforming the tax system:
Scrap income tax (stop punishing work)
Scrap Federal Insurance Contributions (stop punishing work)
Scrap sales tax/VAT (stop punishing spending)
Scrap corporate tax (stop punishing entrepreneurship)
Scrap property tax (stop punishing development)
Then move the entire tax burden onto unearned income:
Georgist land value tax
Interest
Dividends
Rent profits
Stock capital gains
Real estate capital gains
Inheritances
Trust funds
Natural monopolies
We should also start charging companies for their full cost to society:
Plastic/packaging disposal fees
Pollution cleanup fees
Health cost fees (on alcohol, cigarettes/vapes, sweeteners, etc)
Hazardous waste disposal fees
Reason-based government spending
Now that we’re not creating money as compounding debt owed to private banks, and are now collecting taxes in a way that punishes bad behavior and rewards actual work and contribution to society, it’s time to spend those lovely tax dollars.
Everything that can be moved off the operating budget and too to the sovereign wealth fund’s investment budget should be moved to the sovereign wealth fund’s investment budget. No more corporate socialism. As often as we can, users-only should pay (IE highways, water, airports, seaports, etc.)
Welfare and pensions should be needs-based. (There are more than 3 million millionaires in the U.S. who receive a taxpayer-funded pension.)
The healthcare budget needs to be heavily invested in prevention to maximize taxpayer savings.
A big chunk of the Department of Defense’s $1T budget needs to be actually spent defending Americans in America — by enlisting the army to decimate crime, build houses, construct hydro dams, etc.
Social security needs to invest in building houses instead of subsidizing rent payments to land-lorders. It also needs to wean millions of permanent welfare by replacing handouts with a living wage job guarantee.
Do all this and the government will soon see balanced budgets again.
In conclusion
Pair these three things together — sovereign money creation, just taxation, and reason-based government spending — and you have a recipe for astounding and unfathomable growth, prosperity, and well-being.
What you won’t get is compounding debt and perpetual dependence on banks and corporations.
That’s why this plan hasn’t happened.
Yet.
Continue along our current path and the West will descend into cultural chaos and economic ruin, at which point the West’s enemies — Russia, China, fundamentalist Islam, and the globalist corporatocracy — will pick our bones clean.
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