Tag Archives: Size of Government

“Tax Expenditures”: Not Taxing Is Allegedly Spending

open quote Runaway government spending is among the most important economic problems of our time. It is absolutely urgent that it be brought under control and progressively reduced until it is sufficient to provide for no more than the essential government functions of defense and justice. Only then will the citizens have the greatest possible individual freedom to decide how their earnings are spent and the greatest possible motivation to increase their earnings and improve their standard of living.

As recognition of the importance of bringing government spending under control has grown, the enemies of individual freedom have seized upon a tactic which they hope will avoid the necessity of reducing government spending, and, will allow them to go on increasing it, under a fraudulently created appearance of reduction. The tactic is described as “tax expenditure.”

More precisely, a tax expenditure is a fictional, non-existent tax accompanied by an equivalent fictional, non-existent expenditure. Although the government does not actually collect the tax, the fact that it has the power to do so is used as the basis for pretending that it does collect the tax and that it uses the proceeds to make an expenditure that goes to those from whom it has chosen not to collect the tax. In this way, the taxes that are not collected are treated as though they were collected and then used as a subsidy paid to those from whom they were not collected. In effect, the government’s not taking is alleged to be giving. Its not taxing is alleged to be spending.

Examples of tax expenditures recently provided by The New York Times are the taxation of capital gains and dividends at lower rates than ordinary income; allowance for deductions from taxable income of the payment of interest on home mortgages, the payment of property taxes, state and local income taxes, charitable contributions; and the absence of taxation on employees for health insurance and pension benefits paid for by employers on their behalf. All in all, according to The Times, “Tax expenditures cost the federal government more than $1 trillion a year in lost revenue.”

When one recalls that in World War II, there was a 90-percent bracket in the federal income tax, and that the government has it in its power to impose such a tax rate on everyone but presently chooses not to do so, then it becomes clear that by the logic of the concept, the cost of tax expenditures to the federal government is not just $1 trillion, but many, many trillions. It is, in fact, everyone’s entire income and wealth.

The philosophical principle underlying the concept of tax expenditure is that we are all serfs or slaves in the power of our Lord and Master the Almighty Government. It owns us and all of our income and wealth. All that we earn and possess, we do so by virtue of its largess, by virtue of its giving to us what we may have believed was ours to begin with. close quote (Read more)

National Endowment for the Arts gives $100k taxpayer money for video game featuring Black Female superhero

Feminists hate video games. The culture and structure of the industry makes it difficult for them to penetrate the way they penetrated the movie and television industries.

open quoteThe National Endowment for the Arts is funding a new interactive game from filmmaker and digital media artist Ayoka Chenzira, Ph.D. It’s called HERadventure, a science fiction-based, multimedia platform project intended to target women 18-25 with the aim of bringing awareness to social issues affecting women like depression, discrimination, or pollution. The star of the project is HER, a black female superhero from another planet.

Inside Spelman asks, “What would happen if the societal issues affecting women put other planets at risk?” The answer is HER, the superhero created by Chenzira. Spelman College was recently awarded a $100,000 grant from the NEA to pursue HERadventure and one of four nonprofit organizations to receive a grant for a gaming project.close quote (Read more)

Here’s the Ted talk given by the recipient of the $100k. It’s astoundingly unimpressive:

An Investation of Generals

– open quoteThe reality, however, is that there are nearly 1,000 generals and admirals in the U.S. armed forces, and each has an entourage that would make a Hollywood star jealous.

According to 2010 Pentagon reports, there are 963 generals and admirals in the U.S. armed forces.close quote

– open quoteFormer Defense Secretary Robert Gates appointed Arnold Punaro, a retired major general in the Marines, to head an independent review of the Pentagon’s budget. Here’s the caution he came up with: “We don’t want the Department of Defense to become a benefits agency that occasionally kills a terrorist.” [emphasis added]

So, just how good are these benefits? For the top brass, not bad at all. According to a Washington Post investigation, each top commander has his own C-40 jet, complete with beds on board. Many have chefs who deserve their own four-star restaurants. The generals’ personal staff include drivers, security guards, secretaries and people to shine their shoes and iron their uniforms. When traveling, they can be accompanied by police motorcades that stretch for blocks. When entertaining, string quartets are available at a snap of the fingers.

A New York Times analysis showed that simply the staff provided to top generals and admirals can top $1 million — per general. That’s not even including their own salaries — which are relatively modest due to congressional legislation — and the free housing, which has been described as “palatial.”close quote

– open quoteU.S. ambassador to Nicaragua, wrote an Op-Ed in the Chicago Tribune explaining how the generals’ perks allow them to exist on a plain removed from ordinary people:

“Those with a star are military nobility, no doubt, and those with four are royalty. Flying in luxurious private jets, surrounded by a phalanx of fawning aides who do everything from preparing their meals to pressing their uniform trousers, they are among America’s most pampered professionals. Their orders are executed without challenge, their word is fiat. They live in a reality different from the rest of us.”

Frank Wuco, a retired U.S. Naval intelligence chief, agrees.

“With the senior guys and the flag officers, this is like the new royalty,” he said on his weekly radio show. “We treat them like kings and princes. These general officers in the military, at a certain point, become untouchable… In many cases, they get their own airplanes, their own helicopters. When they walk into a room, everybody comes to attention. In the case of some of them, people are very afraid to speak up or to disagree. Being separated from real life all the time in that way probably leaves them vulnerable (to lapses in moral judgement).”

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– open quoteThe Pentagon, for example, runs a staggering 234 golf courses around the world, at a cost that is undisclosed.close quote

– open quoteAccording to a Washington Post investigation, the DoD also spends $500 million annually on marching bands.close quote

– open quoteSince they’re so used to the luxurious lifestyle, the vast majority of pension-reaping high-ranking officers head into the private defense industry.

According to William Hartung, a defense analyst at the Center for International Policy in Washington, D.C., about 70 percent of recently retired three- and four-star generals went straight to work for industry giants like Lockheed Martin.close quote (Read more)

Homeland Security is building a $4 billion 170-acre complex for 17,000 employees

Further proof that the fiscal cliff hysteria is sheer nonsense.

open quoteThe US Department of Homeland Security, despite budget cuts and construction delays, is planning to add 17,000 employees into its consolidated headquarters in southeast Washington. The department broke ground at their new headquarters in 2009 and was originally scheduled for completion in 2016. The new complex is now scheduled for completion in 2022.

The 4.5 million square-foot “federal mini-city for the Department of Homeland Security” on the site of the former infamous psychiatric St. Elizabeths Hospital and is the largest federal construction job since the pentagon was built in the 1940s. The construction of the project was originally expected to cost $3.4 billion but is now going to cost at least $4 billion and is expected to “create 16,000 direct construction jobs”.close quote (Read more)

Super-costly F-35s, a global wrecking ball

open quoteThere is a stark lesson in the escalating cost nightmare of the F-35 fighter jets that holds more ominous implications for Washington than even for Canada’s Harper government.

Quite simply, it is that allied Western nations are finding the once-vaunted high-tech American weaponry no longer politically affordable. Not in large numbers.

Canada’s grief over its share of the F-35 price tag — now estimated to be almost $46 billion over 42 years — has been shared by a half-dozen countries, including Britain, Australia, Italy and the Netherlands, which have been forced to either cut back on their orders or contemplate outright cancellation.

This political fallout is upending the whole global arms bazaar. Around the world, America’s big-ticket defence items are being increasingly challenged by cheaper products from Europe and now Asia as well.

More developing countries are shunning extravagant U.S. weaponry for the cheaper but quite-good-enough products of Russia, China, India, and South Korea.

India itself recently rejected a large F-35 purchase in favour of buying more Russian and, possibly, French fighters for its fleet.

. . . .

t is a problem that goes well beyond the F-35s.

American insistence on super-smart combat designs has pushed the price tag of one destroyer to $1.2 billion and a new submarine to twice that. Even Congress has started to gag at such numbers.

Ironically, it was Washington’s concern over rising foreign competition that led to the F-35 woes.

The Pentagon recklessly raced the Lockheed Martin F-35 into early production in 2007, even before it was flight tested, in an attempt to corner the market for the company’s new stealth technology.

As aviation analyst Richard Aboulafia told the New York Times, “there was this big desire to kill the competition.”
‘Acquisition malpractice’

Bypassing flight tests before production was extraordinarily risky and some officials inside the Pentagon warned it would end badly. But apparently higher-ups insisted that any kinks would be worked out in computer simulation.

The F-35 was originally to have been a relatively affordable mix of three different plane types. But it turned out to be a far more complex hybrid than imagined.

Start-up costs have already consumed $65 billion, and the whole mess was denounced as “acquisition malpractice” by the Pentagon’s new procurement chief, Frank Kendall, earlier this year.

The F-35s are now the most expensive weapons program in history, so over the top, in fact, that the Pentagon’s original hope to produce some 2,400 of these fighters, spread across nine nations, is fading fast.

The estimated unit price per plane has doubled from $69 million to $167 million today and some industry experts warn that only half that projected production run may be achievable. . . .close quote (Read more)

Seven of nation’s 10 most affluent counties are in Washington region

open quoteThe Washington region has emerged from the recession looking even more affluent compared with the rest of the country, boasting seven of the 10 counties with the highest household incomes in the nation, new census numbers show.

With a median household income surpassing $119,000, Loudoun County heads the list. Fairfax County, at nearly $106,000, is second. Both have held the same positions for several years running.close quote (Read more)