This is the most confusing time in our country that I can remember. While I have not always understood every nuance of government action, political moves, or economic gyrations, I’ve generally been able to recognize why most things happened. Not so, today.
It reminds me a lot of the investment confusion during the internet run-up, when some stocks were selling for ridiculously high amounts based on some unknown valuation technique that didn’t take into account net assets or profits or even a rational payback ratio… while the stock of some solid companies that owned a lot of assets, had a proven track record, and actually made profits were selling for less than they were in tougher times. The “internet bubble” burst, of course. It was only a matter of time.
We’re currently going through another weird period that was self-inflicted. Some of our “leading” Congressmen used their legislative influence to manipulate the market to accomplish social goals… and, as a result, mortgages were given to a huge number of people who realistically could not pay them back. Push these through the mysterious economic black box of securitization and distribute them throughout the world economy and you have a broken “Humpty Dumpty” that’s difficult, if not impossible, to put back together again. Not that Congress won’t try.
So, now we have an even worse problem, in my opinion: Congress is going to “solve” the problem they caused (but won’t admit to)! Will they actually address the problem? No, it’s just another excuse to grab power, money, and influence to further their careers and social agendas.
Here’s another example of the topsy-turvy situation: nominees for some of the most powerful government positions have admitted to not paying their taxes (along with other legal violations). Actually, some sitting members of Congress are guilty of the same things! These are supposedly our “leaders”. Right.
We used to do things to take care of our government (like obey the laws, pay taxes, and vote) and now, it seems, all too many people think our government is supposed to take care of us… they don’t pay taxes, require community organizers to “help” them vote, look for handouts from the government… and get it!
Some STATES do the same thing! Instead of controlling their budgets, some have operated in the red (and, even more sinfully, some of their spending was for absolutely unnecessary programs). California has recently announced they will not be able to send out tax refund checks.
An aside: remember, when an amount is withheld from your paycheck, that is not really a tax… it is a PREpayment. You file your tax return at the end of the year and apply that withheld amount toward your taxes. If more money has been withheld than you own in taxes, the difference is refunded to you… giving YOUR MONEY back to you! This is but one more reason why the Fair Tax should be adopted by our federal and state governments and income taxes abolished… but that’s another discussion.
So, it’s not just individuals… some States are acting like bad citizens and want the rest of us to bail them out.
How long are we going to REWARD bad behavior?
How long CAN we reward bad behavior?