The breakout headliner issue in 1978 was “Tax Revolt.” A Time Magazine cover showed Howard Jarvis shaking his fist under that headline. Proposition 13 time. Then? The Tax Revolt went, as we would now say, viral. Citizen discontent — and political activism — against high tax rates turned into a national, and then international, phenomenon. The revolt was a major factor in toppling President Carter. It led the U.S. top income tax rate to collapse from 70% to 28%. Then, rates worldwide cascaded down and global prosperity rapidly soared. Will the 21st century equivalent be a “Money Revolt”?[Read more...]
During this Chinese New Year, more than a billion people will be welcoming in the Year of the Black Water Snake, celebrating with family and friends all week long. The previous Year of the Black Water Snake was in 1953, which was when China launched its first Five-Year Plan and the average annual income for a family in the US was about $4,000.[Read more...]
Notwithstanding overwhelming evidence to the contrary, the Fed remains steadfast in its refusal to accept any blame whatsoever for the near collapse in 2008 of the financial system it regulates. That said, the Fed is quick to take credit for having saved the system from disaster and for getting the economy back on track. On track? Well, over a year ago, Chairman Bernanke was talking about how the â€œgreen shootsâ€� of recovery were increasingly evident. Weâ€™re not sure exactly what was green, other than the colossal amounts of freshly printed dollars being thrown at the economy, but just as young plants donâ€™t always survive and thrive, the US economy is clearly struggling again of late, with the broad unemployment rate U6 having risen again to 17.1% in September.[Read more...]
They fought the correction; the correction won.
We refer to Bernanke, Summers, Obama, Geithner, Krugman – the whole lot of them. They added three trillion dollars to US debt in the last two years. In two more years the debt will be at 100% of GDP. Add in the debts they’ve guaranteed – from Fannie Mae, for example, and state and local debt implicitly backed by the feds – and you’re already at 150% of GDP. Worse than Greece, in other words.[Read more...]