The average homeowner who deducts interest on his mortgage does get what can be called a middle class tax advantage. However, it is not what the left describes as a major benefit.
Most taxpayers do not figure the actual comparison of taking a standard deduction versus itemizing deductions. You give up what the IRS gives in the standard deduction, to get the itemized amount, so you profit only from the difference. Calculate your benefit by doing your taxes both ways.
We keep hearing more and more about “black swans” and protection in finance and business. These are highly improbable events that occur despite all we do to prevent them. This reflects the fact that there are rarely any black swans to be found in nature.
So, we keep attempting to protect ourselves against future black swan-type debacles. We’re spending a fortune in corporations to do so.
The U.S. Congress, with its propensity to spend, is great at outlays. The Dodd-Frank legislation is a perfect example of over-action and resulting unintended consequences, which you can be certain, will not prevent the next black swan incident.
One objective of Dodd-Frank was to make banks smaller, not too big to fail. The result in less than a year is that smaller banks cannot exist amidst the new regulation, and larger banks are getting ever-larger.
Listen to the leftist politicians and you have a conjured picture of a fat cat, smoking a cigar with his feet on a desk, or better still, a fishing rod in his hand.
Not so. The so-called rich are usually the ones employing you, the ones who run small and large companies, with emphasis on small. After all, anyone with income over $250,000 before taxes is now considered rich. Those over $250,000 a year income are often employers. By the way, how many jobs will that cover?
The rich from one measurement to the next are not even the same.
Here is another basic economics lesson not taught in expensive colleges. It has to do with the Obama administration’s past failed efforts to revive the economy by getting into enormous debt.
To name a few: Unnecessary bank bailouts, stimulus outlays that were merely slush funds for government funds, and let’s not forget giving new car buyers a $4500 cash allowance for clunkers when buying a certain type of new car.
It was not successful for many reasons I pointed out early on.
One: The government mixed an economic stimulus concept with an environmental objective so it confused the public.
Two: Cars sold in this manner meant that none would be sold normally for a couple of years after the program terminated. The public’s appetite was temporarily stimulated but then held off from future buying.
Three: Because of the way clunkers were being disposed, the used car and parts markets were adversely affected.
If money of this kind were used for clunker cars, what about clunker washing machines, or lawn mowers, and so on? Or government funds for buying clothes?
Most folks are beginning to care about a weak dollar. The media is catching up with the subject.
Still, too many are still certain about government being able to offer them more goodies. That’s because they are often influenced by media sound bytes when it comes to political news. It’s sports and other circuses that get too much of their attention.
So a weak dollar that concerns whether foreigners or foreign governments buy U.S. Treasury bonds have no importance to them.
But when they have heavy inflation because the government has to literally print money to balance the budget, they will notice. By then they will blame the wrong folks for their financial woes, taking their cue from the same faulty media sound bytes.
This morning’s news flash from a major news network is a daily repeated example of the leftist slant of conventional news sources.
The report is of gasoline prices at the pump hitting a new high. Immediately followed by news of record oil company prices. The connection is obvious and so the public remains ignorant of the fact that oil company profits average only 8 cents on a dollar of revenues.
And that the Obama administration is holding back new drilling and refining capability.
So what else is new?
When liberal politicians get together and try to legislate from their hearts and secular religious beliefs, you are certain to get a hodgepodge of unintended consequences. The Dodd-Frank legislation of 2010, on which I’ve commented many times, is a perfect illustration.
Just one example I would like to point out because it’s happening before our eyes and it’s an event Dodd-Frank was supposed to actually prevent.
Dodd-Frank regulations are killing smaller banks, It’s tough enough for large banks to contend but the added costs of keeping up with regulations add to administrative costs and financial requirements that banks simply cannot afford.
