I met with my accountants yesterday, which is always like a particularly unpleasant trip to the dentist. Don’t get me wrong… They’re great folks — friendly, professional and completely anal in making sure I comply with every jot and tittle of our unfathomably complicated tax rules – a skill set for which I’m more than happy to pay a premium.
It’s not that I even necessarily mind paying taxes. It’s just that with every visit, I’m reminded again of the futility of those tax dollars being squandered to further prop up our teetering Ponzi system of entitlements where the math simply no longer works, and where the bankrupt Savior State continues to willfully ignore the problem.
As former Reagan economic adviser Larry Kotlikoff pointed out last August, the U.S.’s real indebtedness now clocks in at $211 trillion, more than 15 times the official $14 trillion figure.
Kotlikoff reminds us of the inconvenient fact that with 78 million baby boomers poised to collect about $40,000 per person over the next 15 to 20 years, we’re looking at a $3 trillion annual bill just to prop up the Social Security system alone. It’s simple math… There is simply no way for a country to grow itself out of a liability that large.
Yet the charade continues, politicians of both parties pretend there’s a painless solution to the looming entitlement catastrophe, and with each passing season more Americans receive entitlements (one in seven Americans were on food stamps in 2011) and fewer and fewer Americans are left to pay for it (Only 49% of American taxpayers even paid income taxes in 2011).
For the now minority of Americans who still do pay income taxes, tax collectors and enforcers grow ever more draconian and intrusive in wringing every last penny out of the dwindling productive elements of society.
It’s not just the Feds either. States are increasingly extracting their pound of flesh from the productive class to fund their own state leviathans.
In Texas, the most senior state lawmaker admitted last week that he voted to save red light camera programs, not because they have any effect whatsoever on public safety (he admitted they don’t), but rather because they are an easy and Big Brotherish way to entrap drivers into generating revenue for cancerous state government bureaucracies.
(If you doubt that the real intentions are revenue generation, take a look at the growing number of cities that have been caught actually reducing yellow light times in order to catch more red light runners.)
Even the mainstream media is more than happy to oblige such predatory government bureaucracy.
In what Doug Casey recently termed “a shocking indictment of the depth to which the moral and intellectual character of what was once America has descended,” the Wall Street Journal published an article last September titled, incredibly How to Turn in Your Neighbor to the IRS.
Imagine that… The Wall Street Journal, supposedly the bastion of capitalism and freedom, publishing a “how to” guide on snitching out your neighbors and relatives to the Feds!
US Customs and Immigration are getting in on the game as well.
Last month on an international flight out of Miami, I counted seven armed-to-the-teeth ICE agents strategically placed on the jet bridge to intimidate and interrogate boarding passengers. At least three agents were wearing those black fingerless gloves, a totally unnecessary accoutrement, but one that has the desired effect in conveying threatening bad-assery.
I was one of the unlucky travelers pulled out of line and interrogated about how much money I was carrying ($5.00), what the purpose of my trip was, what I did for a living, and so on. The message was crystal clear: Failure to declare more than $10,000 leaving the country on form FinCEN 105, will result in forfeiture and criminal penalties.
These guys weren’t part of the security industrial complex that ostensibly protect us from terrorists trying to enter the country, they were interrogating Americans leaving the country about how much money they were carrying. Now, ask yourself why that is…
When states cheat their citizens to prop up bloated bureaucracies, when even mainstream media urges readers to snitch out family and neighbors to the Feds, and when customs and immigration officials search and interrogate passengers leaving the country about how much money they have on them, that’s a pretty clear indication we’re flat broke.
The truth of the matter is that the Savior State has now been reduced to the equivalent of rooting for the last remaining spare change hiding in the couch cushions.
At some point, we will have no choice but to accept the need for a Plan B, which will require a return to our founding principles of freedom and liberty, a new understanding of the role of the state and entitlements, and likely a return to a more local and decentralized economy. Plan B will either be forced on us, as is currently happening in Greece, or we can take steps now to plan for it. But the day of reckoning is coming whether we like it or not.
Count on it.
