Wednesday, January 30, 2013

BloggeRhythms 1/30/2013

Three different news items today confirm my continuing belief that, sooner or later, the fiscal policies of the administration will either sink the nation’s economy completely or stimulate some form of revolt by the financially successful now carrying the entire fiscal burden on their backs. And this takes no particular predictive skill on my part, nor access to anything more than what’s reported in the daily news.
 
An article by Joshua Rhett Miller on Fox News.com is headed “For millionaire athletes, states with highest tax rates may not make the cut.”
 
In it, John Karaffa, president of ProSport CPA, a Virginia-based firm representing nearly 300 professional athletes, primarily in basketball and football stated that, “They’re going to have an exodus of people. I think they’ll see some [leave California] for sure. They were already a very high tax state and it’s getting to a point where folks have to make a business decision as well as a lifestyle decision.”
 
I’ve mentioned Phil Mickelson in this regard before, however in his case, California's increase of the top bracket to 13.3 percent from 10.3 percent cost Mickelson roughly $1.8 million of his $60 million income for 2012.
 
And then, according to the Associated Press reported on CNBC News “The Commerce Department said Wednesday that the economy contracted at an annual rate of 0.1 percent in the fourth quarter. That's a sharp slowdown from the 3.1 percent growth rate in the July-September quarter. The surprise contraction could raise fears about the economy's ability to handle tax increases that took effect in January and looming spending cuts.”
 
In regard to the dismal  economic news, Noel Sheppard, Associate Editor of NewsBusters on-line via Drudge, quoted Rick Santelli of Squawk Box, also on CNBC, saying "We are now Europe."
 
Mr. Santelli went on, "[W]hen you act like Europe, you get growth rates like Europe, and our discussions with economists sounds like we're in Europe. They have the same discussions constantly. They’re always doin’ the right thing. They’re always thinking they know better. And this is the kind of growth. We have become Europe. We are now Europe."
 
Steve Liesman, also of CNBC retorted, “We reduced federal spending, government spending by 15 percent. Which part of that’s not Europe don’t you get?”
 
“And why do we need to reduce government spending?” asked Santelli. “Because we run trillion dollar deficits for crying out loud.”
 
Item three regards Rick Perry, Republican governor of Texas, who yesterday called for changing the constitution of his state, the nation's second most populous, to allow the return of tax money to the people who paid it when the state brings in more than needed.
 
So, to me, what the preceding illustrations point out is that when highly successful, productive, folks get pushed too far they don’t sit still, they react. And when they feel they’re being used or abused somewhere, they move to someplace else. And, since folks like these are attractive to leaderships that are smart, incentives are created to draw them in, as shown by Texas in this case.
 
Thus, although I have no idea as to what the ultimate solution will be for those who carry the non-productive half of the nation on their backs, I’m absolutely certain there will be one. And conversely, since the combination of those in government and the deadbeats they foster as constituents not only have practically no common sense, business sense nor will to work at all, my bet is they’re going to wind up in wastelands all by themselves and broke as well.
 
That’s it for today folks.
 
Adios

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