It's the economy, dummy

I questioned a little while back, jokingly of course, about whether we were still in Iraq because of the lack of "body-bag reporting" I was seeing in the mainstream media.

Good news, I knew, is bad news where the liberal template is concerned with Republicans in office. And so the drastically downward trend of violence in Iraq meant no news.

Not to worry, though! Now, the drumbeat is our "rotten" economy. We're all doomed! Therefore, we need a liberal president who will "tax the rich" and institute price controls and all their socialist ideas that have worked so well everywhere else.

The "economy sucks" mentality actually has existed for about seven years now; "tax" talk coupled with "the rich" much, much longer.

Allow me to offer a personal example of the folly:

I remember well when GW announced an array of tax cuts when he entered office. One liberal friend, in particular, slipped into a vein-popping "tax cuts for the rich!" frenzy. Because these cuts were made retroactive to the previous year and, thus, would go into effect on the tax return I was about to prepare, I was motivated to file as early as possible.

And because a number of the cuts (such as the marriage penalty tax) benefited anyone who actually paid taxes, my refund that year more than doubled. So I happily announced the next time I saw my liberal friend that I had decided to retire immediately, seeing as how I apparently was "rich."

And this, I pointed out to him then, represented the exact opposite to what I experienced in 1992. Slick Willie, after making his pre-election No New Income Tax Pledge, assured us all after entering office and immediately announcing that he was, in fact, going to raise taxes that the increases would not affect middle- and low-income families. And on my first return under his system, I went from getting about a $1,200 return for several years to owing more than $1,000.

And in neither case was I even remotely "rich."

The simple fact (that's something that's actually true, as opposed to the bumper-sticker slogans embraced by Libs) is that the top 25 percent of wage earners in this country pay 86 percent of all income tax collected by the federal government.

So simple deductive reasoning would conclude that any tax cut would benefit those top 25 percent more than, say, those who pay no income tax whatsoever. Right? Are you with me? Well, that 86 percent is actually a 2 percent increase from before GW entered office. So the top 25 percent of wage earners are actually paying a larger share of the federal government's take.

A quick peek into Webster's Tenth Edition seems to indicate that the word "cut" suggests a lowering of some sort ...

Now, someone can argue (and plenty do) that the top 25 percent is earning more as a result of these tax cuts and therefore also paying more. It's the "rich get richer" argument, which essentially is a large smelly pile of cow poop.

The rules, my friends, apply to everyone. It's the whole "life, liberty and the pursuit of happiness" our founding fathers bestowed upon us. The small handful of people who controlled 80 percent of the wealth in good ol' USA circa 1920 has grown to a boat load. Do a little investigating sometime on the exponential rise in the number of "millionaires" in this country every two or three years.

Folks, the only limitations we as Americans have on what we do or what we earn are those which we place upon ourselves. That and the number of tax burdens placed upon those who try to get ahead. It's been proven time and again that the less we tax, the more our economy is stimulated. And the more our economy is stimulated, the better it is for everyone.

Everyone, that is, who isn't sitting on his/her ass waiting for each month's welfare check.

Anyway, back to my "tax the rich" point ... I find it funny how liberals translate "rich" and "poor." It's all in what they're talking about at the time.

One apparently is considered "rich" to liberals if he or she makes in excess of $35,000 per year (which is about what I earned in 1992). At least in terms of tax increases and cuts. But to read all the dire news about our economy lately, one is considered "poor" even if he or she makes in excess of $100,000 per year. The stream of stories lately about our "rotten economy" and the need for government intervention bear this out.

The number of "examples" trumpeted by the media of people who are suffering through these dire economic times include a fair number who make close to or even much more than I do. The LA Times, in fact, did a Sunday piece not long ago in which several people were quoted ... people who the story said made in excess of$100,000 per year ... who just can't make ends meet.

I have seen stories about woe-is-me folks who are about to lose their houses not only because they entered into idiotic ARMs (more on that in a bit) but also had remortgaged multiple times, and their payment literally went through the roof.

There are lower-income people who are saddled with mind-numbing credit card debt, which, in passing, also was mentioned in the Times story about these $100K earners. One story even cited a poor "victim" of a 19-year-old who just couldn't afford her $500 per month cellphone bill because of our "rotten" economy.

The answer, of course, is WE MUST DO SOMETHING! Rather, THE GOVERNMENT MUST DO SOMETHING!

I hear the idea of rebate checks bandied about. What exactly is a $300 check from the government going to do for these people? I'll tell you what it will do for 98 percent of them: Zip, nada, nothing. You could give them each $3,000, and the vast majority would happily upgrade their televisions or take a weekend ski vacation or ... pick your poison.

I know what it takes, financially, to run a household. I know when I pick and choose my "luxuries" that I won't have to then choose between making next month's mortgage payment or keeping the electricity flowing. I know I won't be paying interest on credit cards that equals my mortgage payment.

Debt is an individual choice, by and large. At least among adults it is. Bad decisions come down to individual choices. The housing "crisis" largely is a glowing example of this.

The root of the "problem" we're facing now can be found in the vast number of people who made bad decisions five or so years ago and willingly entered into 3- or 5- or 7-year adjustable rate mortgages. You cannot tell me, beyond a handful of blatant idiots, that all these people were hoodwinked by lenders.

There are six houses in my cul-de-sac. Two of them are occupied by people I know very well and talk to frequently who made bad decisions about five years ago. Actually, it was more a case of "greed-based" decisions. Both bragged incessantly about how they were drastically lowering their mortgage payments by shifting from a perfectly affordable fixed-rate loan to these ARMs. Not only that, both opted for "cash-out" options, in which they drew from their equity, and they were equally braggadocio about their new cars, new furniture. One went on a two-week cruise.

"Great," was my response to both. "What happens in five years?"

Both said, in essence, they'd cross that bridge when they came to it.

Guess what? They've come to it. And they're among the more vocal people I personally know when it comes to our "rotten economy" and "F*ck Bush!" and "the government better do something!"

I like these people. I consider them friends. But I'll be damned if I'm going to fall into lockstep with the notion that the government somehow is at fault for their stupidity and needs to "do something."

Is there a mortgage crisis? Yes, to a degree. Whose fault is it? Lenders and borrowers both. Each party made bad decisions. Period. And that has, in turn, affected our economy. As has the price of oil, and that will continue so until we actually make a move toward energy independence. (This model pretty much follows the illegal alien crisis. Until we actually do something to stop it, it will continue to be a problem!)

Bottom line: Economies ebb and flow. And there's never been a time in the history of the U.S. economy when one or two or more aspects couldn't be cherry-picked as examples in doom-and-gloom forecasts.

Remember, too, that this is an election year. An election year in which Republicans hold the highest office and Libs are crying for "CHANGE!" So the worst aspects of our economy, at the moment, are going to grab the biggest headlines.

There just aren't, after all, enough body bags in Iraq to do the trick.

(Imported from Jan. 23, 2008)