Posted on 04/22/2011 7:10:44 PM PDT by TheConservativeCitizen
The days an average American could expect to work, save and leave his kids a bit of wealth have gone into history; middle class Americans have little to pass on but their debts. Neither will the American Dream return for their children nor for their grandchildren. America has voted F.A. Hayek’s Road to Serfdom for itself and that’s a one-way road.
Here’s the picture:
1. Government taxes away 28% of the average taxpayer’s income. 2. Federal regulation costs consumers $1.187 trillion per year on top of taxes. 3. Real inflation costs us about 6% of our purchasing power annually.
Add: All of those numbers are rising steadily.
4. Household income, flat for a decade, has recently been declining.
What do these mean to the U.S. (2009) median household with income of $49,777 ?
Reduce the income by the 28% for all the taxes: ($13,938)
Reduce it by regulatory costs for each of the 117,181,000 households: ($10,130)
Reduce the income by 1 year of 6% inflation: ($2,987)
Remaining household income available for living expenses; $22,722
Compare discretionary income to the 2010 Federal poverty level: $22,314
You might assume that half of all households are living in poverty except that the poverty level income still includes the government’s take that was removed from the median household income. A proportionate adjustment to the poverty income leaves $10,186 to live on after the government takes its cut. So the difference between the median household and the poverty level discretionary incomes is about $12,000 a year. That’s no big difference, these days.
Federal statistics include both bureaucratic and political effects, taking them without the grain of salt isn’t wise. Adjusting the Census folks’ median household income with the Tax Foundation’s average taxpayer’s taxes isn’t precise and people argue about the real cost of Federal regulation. The poverty level is debated too; for one example, it doesn’t consider the Federal benefits from Medicare, food stamps and other programs. But it seems fair to conclude that the lower half of American households is economically marginal to some degree. That’s a weaker society than Americans realize, or are prepared to face. It lacks reserves to get past tough times.
Recalling that much of even the lower half of the middle class relied upon a single earner into the 1970’s says that U.S. households have been losing ground for decades.
Standing on that, let’s review how government is dealing with it:
Under Presidents Bush and Obama, Republicans and Democrats have been adding increasingly costly healthcare programs: Bush’s Medicare prescriptions and ObamaCare. Both programs take more resources from the economy. Both parties have initiated costly, protracted foreign wars lacking either an obvious payoff or a clear end point. And both parties have expanded spending beyond available revenue, first borrowing and when that became insufficient, manufacturing credit and money out of nothing. That’s at least, irresponsible governance and in the cooler light of future history, likely criminal.
President Obama and his Democrats flashed into power flushing the Republicans out; the new leaders could have stepped up, faced the economic wreckage, rolled up their sleeves and started the lengthy process of clearing it away. Instead, President Obama has donned imperial robes, starting costly wars without Congress, handing out extra-legal waivers against Federal law (ObamaCare) and claiming in federal court the right to kill, without review, anyone his administration decides is a threat. And with all that increased power the President, instead of taking on the correction of Republican economics, has led his Democrats in an enormous expansion of his predecessor’s policies even while he has continued to complain of them.
As a result of this, every American family now owes around $212,000 of government debt and interest, plus whatever its mortgage, car loans and credit card balances may be, and while families are responsibly (though slowly) paying down their own debts, the Democrats in charge are increasing the government debts that the families will ultimately pay. What they will use to pay them is not obvious. Averaging total U.S. debt, government plus personal, comes to about $676,000 per family and the country’s savings per family are $6,860. Where are the resources to repay the debt? Without the interest, to repay all that debt in 20 years requires $33,800 per year from every family.
The Obama government is not just increasing the chains of debt around the ankles of increasingly marginal U.S. families; it’s raising taxes and increasing regulation (especially in food and energy), leaving families with decreasing resources to handle those debts. And if those policies were not destructive enough, the government is further driving up the cost of living by the inflation its money and credit manufacturing produce.
Government’s regulatory regime does more than absorb dollars from families by increasing the cost of goods and services. It’s also a prime contributor to the emigration of high-cost industries to cheaper foreign locations, depriving U.S. workers of jobs. That and the failing economy have produced a U.S. civilian workforceparticipation rate in decline since 2000 with those hit hardest by unemployment being men and the young. Those newly non-working demographics have to be supported by someone; that pushes harder on family resources.
Government policy has been pushing Americans along Nobel Laureate Hayek’s road for several generations now but even when previously at-home spouses had to go to work during the 1970’s, there were few complaints. The Progressives succeeded in converting that economic hardship into something socially desirable; it was somehow noble to move from domestic motherhood into economic serfdom. The same process now urges the Luddite government’s further economic retrogression onto families in the name of the environment.
It used to be American to wish to be rich; that ambition produced the “can do” attitude that made the U.S. far and away the wealthiest place in history. Today, piping soothingly to smooth away the frightening reality and accompanied by his journalists (also on wind instruments), our imperial pied piper in Washington is leading us in a retreat from our own history, back into the economic servitude our ancestors struggled so hard to escape. So far, no little boy has awakened us to the nakedness of his program.
It has to be more than 1/2, more like 3/4.
Actually, only those who pay Federal taxes are on the hook for this, not "every American family". Over half of the people now pay ZERO federal taxes. So, every TAXPAYING family is probably on the hook for at least double that figure.
These folks are history. They will riot. gas will go to $5 and they cant go to work. DRILL DAMMIT!!! This nation runs on oil and there is plenty!! Obama will be defeated!! Seize arab oil fields now!!! I love Trump!!
The Kenyan and his commie thugs sure are stickin’ it to whitey.
The Kenyan and his commie thugs sure are stickin’ it to whitey.
Thay sure are.
$5 a gallon gas won’t kill the economy, nor will $7, $8, or even $10 a gallon gas, but $20 or $30 a gallon will, and that’s where we’re headed when the dollar is no longer the world’s reserve currency.
At $10/gallon gas, you will see people riding scooters and bicylces to work. You will also see people freezing to death in their homes. So, yes, the Economy will tank.
people will riot at $5 and they will be killed by obombus,
And, the cost of everything else will go way way up.
And, the cost of everything else will go way way up.
The latter is what bothers me. Freezing to death. This winter will bring about losses that we never imagined. Imagine monthly oil bills over $1000. I wonder if people will pick apart their homes for wood, if they even have a fireplace.
I, for one, will be opening my door to friends and family to stay. Hopefully, all of us together can afford a heating bill for one house.
“U.S. Households Are Just Hanging On”.......thanks to the majority of ignorant, illiterate electorate that bought the “messiah” hook line and sinker. And it wouldn’t be a big surprise if he pulls it off again, as too many jerks in this country expect to sit on the couch and let American tax payers support them.
There HAS to be a heating alternative of some sort. Wish we had a wood burner.
Wish we had a wood burner.”
Unfortunately there are lots of areas in the U.S. now where you can’t burn wood - it causes global warming or some such crap don’t you know!
You can tell that Californians are making these stupid global warming laws. It’s WARM where they live most of the time, they don’t have to worry about heat.
Wood burners, fireplaces, pellet burners aren’t illegal here yet. That sort of thing would ruin the tourist industry.
Your kind of new around here posting wise. Do you have a place you call home?
We live in Texas and it certainly is not cold much of the year but at Christmas we like to have a wood burning fire at least for ambience and because it smells wonderful. If it’s too warm for a fire, we just turn the air conditioning on. I am sure this type of behavior would just absolutely drive the libs up the wall.
$5/gallon gas is just a dollar away. Do you really think that rioting will break out at that point?
Are you going to start rioting? Am I? (admittedly, I’m in South Korea on military orders, so that’s not the best example)
But the point remains, that we are just a dollar away from your riot point. I don’t see the Obama’s flock of sheeple rioting over this.
Happy Easter Soldier.
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