A Conservatarian Manifesto

The Coherent Ramblings
of a Disillusioned Former Republican

“If everyone is thinking alike, then someone isn’t thinking.
General George S. Patton, Jr.

Rob_Scowel_Obama_portraitAs I reflect on my short life, I often have the chance to ponder on where my belief system began.  It has been an interesting journey from an uninformed teenager to a semi-apathetic college student, to today. I am now an informed adult quickly hurtling toward middle-age, although I refuse to act it.

The Early Journey

Most of my ideas, thoughts, and belief system (political, religious and otherwise), started with my parents. I am a Christian and an Eagle Scout. I feel that these experiences have molded and shaped my work ethic and way of thinking. One of my greatest heroes is my dad, who has had a profound influence on my life.  We often talk of political issues and agree most of the time.  Even though I am a little more radical in my way of thinking, we do agree most of the time.

Going through life I feel I have made the right choices, most of the time, in regards to life and education. I went through my undergraduate work in five years gaining two bachelor’s degrees. I later attended graduate school achieving a master’s degree. It was at this time that I discovered that the “real” education begins outside of the classroom!

I give this basic information only as a background on my life experiences and as a basis for my belief system.

The Political Journey

In 1988 I voted in my first Presidential election, or any election for that matter. My vote went to George H.W. Bush. I don’t remember the reason I voted for him, but it seemed like a better choice than his competitor, Michael Dukakis.  Not much thinking on my part.

Throughout the next four years I concentrated on my collegiate work and having a good time (friends, parties, etc.). I was by no means a lush – I just liked enjoying myself and the college life. I did not follow many domestic or world affairs during these years.

In 1992 I was a little older and hopefully a little wiser. I was working on a second degree at my university and becoming more informed on domestic and world affairs.

It was that summer I started to listen to (and watch) Rush Limbaugh. He said all kinds of things that I agreed with, and I felt like I had found a kindred spirit in the media. He had many of the same thoughts and desires that I had.  At that time he was the lone voice of conservative political issues.  Finally, someone was speaking my language on the national stage! I was by no means some kind of mind-numbed robot that agreed with every word Rush spoke, but he merely expounded on my thoughts and values already in place.

Throughout the 90’s, my life changed drastically. I got married, started my first job, and continued to move up the proverbial corporate ladder. In 1996 I voted for Bob Dole. He was the Republican and was, in my mind, a better choice than another four years of Bill Clinton. I soon realized that he was given this opportunity, not necessarily to win the Presidency, but as political payback for years of service to the GOP.  I knew, (and suspected that many others did too), that he would never have beaten the popular Bill Clinton…so begins my education in the political realm.

The new Millennium ushered the end of the Clinton era and the beginning of the George W. Bush era. I actually loved the idea of the younger Bush carrying the conservative banner. I saw him as a much more conservative candidate than his father and hoped for big things.

“I started to listen to Rush Limbaugh.  He said all
kinds of things that I agreed with, and I felt like
I had found a kindred spirit in the media.”

I truly believe that George W. Bush started off very well after all the election snafus in Florida. He seemed to be settling into office and dealing with a downturn in the economy after the “dot-com bubble” burst. Then 9-11 hit. I couldn’t have imagined Al Gore dealing with this situation with as much poise and honor.

As the 2004 election came around, I was still in the Bush camp and enthusiastically voted for him a second time. As the election ended and reality set in, Mr. Bush started to play the center, and some times left, in his positions. I watched him cave into the left on issues like prescription drugs and illegal immigration. It seemed like he had lost his way and just wanted to secure some type of legacy beyond the Iraq War and 9-11.  I learned what compassionate conservatism really meant: the abandonment of conservative values.

“The Republicans have failed the country by being lukewarm
on important issues, like spending restraint and domestic
security.  The Democrats have failed us due to their
proclivity to push the country to the left, and develop
a more collective (socialistic) society.”

When the election season of 2007-2008 came around, I was totally disillusioned with the whole political process.  I certainly didn’t identify myself with the Republicans and had nothing in common with the Democrats. To put it quite frankly, I was a man without a party. I started to look elsewhere for a candidate that would make a difference. Sadly, the only candidates I really liked didn’t make it out of the primaries.

In the beginning of 2008, shortly after the birth of my second child, I started a little blog site called Rob’s Rant.  This seemed an appropriate title for my writings and I was not concerned if anyone actually read them. They were meant for my own therapy. I started this forum out of my frustration with the caliber of politicians and the Bush administration. I felt that my voice was not being heard. I had a couple of readers that consisted of some friends from high school and college. Of course, they mostly agreed with my positions on issues. I posted when I was interested.

We witnessed the highly contentious election of 2008 between John McCain and Barack Obama. Being from Illinois I knew that Mr. Obama was not the right person for the job. The more I read about John McCain the less I really liked his outlook for America. I didn’t see much difference between the two presidential candidates.  I reluctantly voted for the lesser of two evils, John McCain.  It was the first time in my life I voted for an individual I had no confidence in to turn the country around. I liked the prospect of an Obama presidency even less.

To be honest, Senator McCain only received my vote because I didn’t want Barack Obama in the oval office.  I also liked that he chose Sarah Palin as his running mate.  I cared very little about her political inexperience and problems with the media. Mr. Obama had less experience running anything, and he now calls the White House home. Fortunately for her, she is distancing herself from the GOP and really attempting to chart her own course.  We’ll see where that leads.

“I am tired of the two party system
with their inherent dishonesty
and disingenuousness.”

Before the 2008 election, I was starting to lean Libertarian in my views, but I didn’t really identify with their whole belief structure. I still consider myself a Conservative but with marked Libertarian tendencies. I don’t believe I am alone in my views and think there are many people who fall into this group.

The Realization

After the election of Barack Obama to the highest office in the land, I decided to see what was happening with the local GOP group.  I was looking for some glimmer of hope for the Republicans. I had been invited by an acquaintance to get involved with the local group so I decided to give them a shot.  I attended my first, and only, meeting in December 2008. I soon realized that although they called themselves the “NEW” Republican Party, the same old people were involved in the same old way doing the same old things. It was the longest two hours of my life and I couldn’t wait to leave.  I know I only gave them one meeting but I just couldn’t torture myself like that again.

The Republicans have failed the country by being lukewarm on important issues such as spending restraint and domestic security issues. The Democrats have failed us for their proclivity to push the country to the left and develop a more collective (socialistic) society. I am tired of the two party system with their inherent dishonesty and disingenuousness.  Do I believe that all Republicans and Democrats are evil? Of course not. I do believe there must be a better way to run the country.

“I consider myself an Glenn Beck conservative.
He is a lot like me.  He rants and raves passionately
about issues that interest him.  Sometimes he swerves
off the rails into perceived lunacy.  I’ll admit it, I like that.”

Since the beginning of 2009, we have witnessed seemingly average citizens, like myself, take time out of their lives to attend loosely organized, as well as extremely coordinated events, protesting hot button issues like taxes and health care. We, as citizens, have been misaligned as radicals and out of touch with society. I believe it is just the opposite.  Having attended a couple of these events, I felt very comfortable in the presence of these groups. I think this is the start of a real awakening of common sense conservatives in America.

As of today, I consider myself a Glenn Beck conservative.  He is the current whipping boy of the left-leaning (and some right-leaning) commentators and main stream media types.  I really don’t care. He is a lot like me.  He rants and raves passionately about issues that interest him, is usually correct on the facts, but like a typical human does make mistakes from time to time and sometimes swerves off the rails into perceived lunacy. I’ll admit it, I like that. If that makes me an unhinged loon, then so be it.

The Future

I have no idea how I will vote in the 2012 election.  I will not whore myself out any longer for a party that seemingly has no interest in preserving conservative values. We need a TRUE conservative to right the ship and reduce the massive amounts of people on the public dole. Other tasks should include a plan to distribute the tax burden more evenly among all of the income levels. Stop punishing the ‘”rich” for their success! Also, stop spending like a drunken sailor on shore leave (sorry, Navy guys, I liked the analogy.)

“When we complain about some group receiving
several million dollars, we are told,
‘That’s just a drop in the bucket to the government.’
Well, in my estimation, that is part of the problem.”

Why are these concepts so hard for the average politician to swallow? I think many, not all, of our politicians have lost touch with their constituents and forgotten they are spending the people’s money. When we complain about some group receiving several million dollars, we are told,

“That’s just a drop in the bucket to the government.” Well, in my estimation, that is part of the problem. When you start adding up all those “drops,” you start to fill up the bucket and then overflow this proverbial bucket. True reform starts with that one drop. Real change comes when we fill up the bucket. Revolutionary change comes when we throw out the collected drops and start over.

Do I think it is too late for the Republican Party to rebound and become a truly conservative party? Unfortunately, I do.  I believe that too many wishy-washy Republicans have infiltrated the GOP ranks for true reform to happen. I hope I am wrong. Until then, I will vote my conscience and not a party.

I will continue to rant and complain about issues I am interested in and hope to strike a chord with someone. I’m not always factually correct and tend to fly off the handle on some issues, but I do have an opinion that I can express for all to hear. Until I’m carted away by a goon squad or silenced by the fairness doctrine or some form of localism, I’ll continue to express my heartfelt thoughts.

Download a pdf copy of this article here.

Of course, this is just my opinion.

Rob’s Rant

 

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13 Responses

  1. You are not alone, Rob! Proud 9-12er here. I had a great time at the DC rally. I agree that the GOP has gone too far to the left.

    Someone once said (I can’t remember who at this moment) that our country is governed as if it were a football game, except that it is always played between the 40’s (yard lines). Unfortunately, with the GOP turning left, we’re now run between the 50 and the 30…the game is moving down-field.

    Shame on the David Frum, Lindsay Gram, John McCain, et al, RINOS all!

    • Thanks for visiting the Rant and commenting. Glad to have you!

      Obviously I agree with your sentiments. The Republicans have become less conservative and much more liberal. The only thing we can do is keep up the heat.

  2. I’ll comment here to address some of the thoughtful points you’ve made about your conservative ideals. You are entitled to be any conservative you want. I just don’t think what you said comes close to what you mean.

    For example, define punishing the ‘”rich” for their success. Should we tax no one above 28%, 31%, 33%? Should we just create a flat tax at 17%?

    Both the flat tax and any tax that caps below 35% unfairly (and significantly so) tends to punish the middle class. We can define the middle class as anyone at 300% of the poverty line to about $250k. You may not call $250k rich, but at this point it can be shown that the severe punishment of a lower tax rate is no longer heavy.

    If you can’t define what you mean, then what does it mean to stop punishing the ‘”rich” for their success. What is rich, where does it start, what rate is punishing?

    I suspect that what you think it means is the ultra slim difference between 36% under Republican Bush and the 38 or 39% under Clinton.

    Slim because the rate does not punish. If you make over $500k in taxable income, you’ll pay $180k at 36% and $190k at 38%. The $10k is a difference of 2%. If you choose not to tax at the higher rate you either borrow from China, or you tax a lower rate more. To raise $10k from a person making $100k you would have to raise their taxes by 10%. That’s one way it would be unfair to the middle class.

    Perhaps you mean, and I would concur with your goal, we should cut Federal Spending by 10%, make the budget $1.2T instead of $1.33T. All we need to do that is to remove all corporate and personal handouts. We could save a cool $100b.

    Another place where I don’t think you’ve defined what you mean is in “Financial Markets – The government should get out of the way of the financial markets and allow them to function properly.”

    I don’t think you can define an intrusion. What rule do you find is an intrusion? Some people say that the current market problems are the result of a lax and unregulated market in derivatives. They understated the risk and overstated the reserves. When the call came to pay they failed. Ouch. More oversight rather than less was needed.

    I don’t think you can describe a world where banking is locked up. For example, to whom can a new bank lend money? To you? Your assets are moving rapidly to 0 – in an unregulated and unsupported market.

    I can poke a few questions at other entries.

  3. Mike ~
    We can save tons of money if we just stopped shipping our money to foreign countries. I don\’t know how we could save, but I bet it would be a lot.

    Everyone knows markets correct themselves, except for maybe some fraud oversight. If it wasn\’t for Democrat meddling, this whole thing would have fixed itself by now.

    Lefties, gotta lov\’em

  4. Foreign payments amount to $20B, so it won’t balance any budget.

    I guess Rob can’t comment on the questions. Perhaps he doesn’t have an answer.

    • Ahh, I knew I could count on you Mike to make a comment and you are so impatient.

      I guess Rob can’t comment on the questions. Perhaps he doesn’t have an answer.

      I don’t sit at home just waiting for a comment on this blog, I have dozens of other activities that take precedence.

      I’ll comment here to address some of the thoughtful points you’ve made about your conservative ideals. You are entitled to be any conservative you want. I just don’t think what you said comes close to what you mean.

      What I said in that post is exactly what I meant to say. It is a thoroughly thought out document. I believe every word.

      For example, define punishing the ‘”rich” for their success. Should we tax no one above 28%, 31%, 33%? Should we just create a flat tax at 17%? Both the flat tax and any tax that caps below 35% unfairly (and significantly so) tends to punish the middle class. We can define the middle class as anyone at 300% of the poverty line to about $250k. You may not call $250k rich, but at this point it can be shown that the severe punishment of a lower tax rate is no longer heavy.

      In America, the “rich” are those paying the lion’s share of the tax burden. In 2001, the top 1% of wage earners (those earning $293,000 or more per year) pay 53% of the total tax burden. The bottom 50% of wage earners pay no income tax. Yes the middle class is always the whipping boys (and girls) and are punished no matter what. The only ones that are getting out without participating are the bottom 50% of wage earners. How is that fair to the actual tax payers?
      Instituting some type of flat tax, fair tax or some other variation of this concept would include everyone. Everyone would have some “skin in the game” as Obama puts it. As it stands now, over 50% of the citizens pay no income tax and some actually come out ahead with the Earned Income Tax Credit.
      A consumption tax would include those outside the tax system (those cash only businesses and other nefarious enterprises.) Everyone would participate and actually have more money in their pocket to spend the way THEY choose instead of the government. For this to work we would have to abolish the IRS or at the least the current massive tax code. That will never happen.
      I would say that by relying on the highest income earners with providing the taxes needed for the government with most of the taxes is punishing the rich. What is not needed, and I fear will come back, is the exorbitant top marginal tax rate that was law in the early 80’s. Hopefully, that will not happen as this would definitely kill progress.

      If you can’t define what you mean, then what does it mean to stop punishing the ‘”rich” for their success. What is rich, where does it start, what rate is punishing?

      Answered above.

      I suspect that what you think it means is the ultra slim difference between 36% under Republican Bush and the 38 or 39% under Clinton. Slim because the rate does not punish. If you make over $500k in taxable income, you’ll pay $180k at 36% and $190k at 38%. The $10k is a difference of 2%. If you choose not to tax at the higher rate you either borrow from China, or you tax a lower rate more. To raise $10k from a person making $100k you would have to raise their taxes by 10%. That’s one way it would be unfair to the middle class.

      You are inferring that I don’t want the high income earners to pay income taxes. I described above that we, as a country, rely on them to pay the majority of taxes collected. We have more citizens not paying taxes than those actually paying taxes. That is a very dangerous point in my mind. The message is that we are punishing achievement.
      Let’s tax everyone but at a lower rate. I prefer a balanced approach to everyone, but I know that will never happen.

      Perhaps you mean, and I would concur with your goal, we should cut Federal Spending by 10%, make the budget $1.2T instead of $1.33T. All we need to do that is to remove all corporate and personal handouts. We could save a cool $100b.

      We agree on this point. No administration, R or D, has had the guts or inclination to actually cut federal spending. I’m more than fine with cutting out personal and corporate handouts. I’m even better with reducing the amount of governmental agencies. Without any figures on the matter I believe the savings would be much more than $100b, but that is pure speculation on my part.

      Another place where I don’t think you’ve defined what you mean is in “Financial Markets – The government should get out of the way of the financial markets and allow them to function properly.”

      This post was not meant to answer all of your questions on every point. You can read my hundreds of posts and see my thoughts on many matters as I know you have or will. Getting involved with banks and financial institutions seems to be meddling.

      I don’t think you can define an intrusion. What rule do you find is an intrusion? Some people say that the current market problems are the result of a lax and unregulated market in derivatives. They understated the risk and overstated the reserves. When the call came to pay they failed. Ouch. More oversight rather than less was needed.

      The oversight mechanisms were there but no one was tending the store. Many were to blame but some in congress sat on the House Banking Committee and did nothing with the pseudo-governmental agencies – Fannie and Freddie. Although the loans to those who couldn’t afford to have a house or payments is only a small part of the problem, it really set a bad precedent. Certainly the blame goes around to all in both the public and private sectors.

      I don’t think you can describe a world where banking is locked up. For example, to whom can a new bank lend money? To you? Your assets are moving rapidly to 0 – in an unregulated and unsupported market.

      I’m not sure where you are going with this comment but I’ll give it a shot. My assets, and those of all of us, are moving rapidly to 0 because of many factors – increase governmental spending (years in the making and not slowing down), printing of currency (devaluing the dollar) and less faith in the US economic system and I am sure a whole host of other problems. I’m not a financial analyst by any stretch, but I do have a modicum of common sense and see we have some pretty major problems.

      Banks are dealing with all kinds of problems – underwater loans, foreclosed properties, bad assets, etc. I have no problem with banking regulations but piling on new ones and getting physically involved with these institutions is a problem – in my opinion. It’s kind of like what happens when someone shoots a bunch of people – those opposed to guns will ask for more regulation and oversight. The truth in that case is that there are already loads of gun laws on the books that could be enforced. More laws will not change or alter the problems we have but actual oversight of problems makes more sense to me.

  5. I don’t think you fully understand why the derivatives market allowed Fannie and Freddie to operate and why it is in the largely unregulated derivatives market that the blame falls.

    I know it’s conservative lore to blame the House Banking Committee. It is important to conservatives to deflect blame away from their insistence on unregulated financial transactions.

    You and I both know that mortgages are sold. A mortgage comes in two parts, the mortgage instrument (very lucrative) and the mortgage servicing. The part of the mortgage sold that you and I see is the mortgage servicing part. You wind up making your payments to some other bank.

    The cost of the mortgage servicing plus the cost of the risk rating insurance are added to the cost of your mortgage. It is then bundled with other mortgages of the same risk into a bond. The bond is then sold to investors. You can buy those at Fidelity or through traders.

    Some mortgages are too risky to sell. They needed a risk mitigation plan. Derivative are very complex instruments that used bundling to hide bad mortgages.

    The mortgages that were too risky to sell were homes bought by investors (flip), no income verification loans, zero down, interest only payments, etc…

    Over 80% of the risky loans were made to people with incomes well above $60,000. I know you’d like to think it’s all ghetto homes, but that just isn’t so — although there clearly were many.

    Just looking at territory will tell you there are many more homes financed in the suburbs than in any city itself.

    Your past posts also have an incorrect definition of predatory lending. Although I agree that people who fell for these loan practices were greedy or dumb, there were some like a 70 year old I know who just didn’t know better.

    Predatory lending is a practice to steal the equity of a home through foreclosure. It works like this: I give you a loan. You think the terms are great, say 4% teaser, never can go up more than 2% per year, and a $30,000 early refi penalty. When that rate hits 8%, you can’t make the payments. I foreclose taking your equity with me.

    It is now illegal in all states and is punished by significant jail time.

    On the income tax part, the 1% pays 53%, while true, is a bogus argument. I’ll show you that for any tax rate, even for flat rates, you can make pretty much the same argument. For example, under a flat tax rate of 20%, then the top 2% pay 53% of the tax. for a flat tax rate of 10% then the top 4% would pay 53% of all taxes, and so on and so forth.

    I didn’t pick 20% as an arbitrary number. It is the number we need to meet the current budget. It doesn’t pay for the wars in Iraq or Afghanistan (these wars well all paid so far by increasing the deficit, yes I can prove it).

    If everyone had to pay 20%, then under your FAIR principle, if you make $20,000/year, the tax would be $4,000/yr. If you make $100,000/yr your tax bill would be $20,000, and if you make $1 Million/yr, the tax would be $200,000.

    Today, the tax rate for those incomes, after deductions, are $0, $12,000, and $300,000 (38% tax bracket less deductions), respectively. A very hefty tax increase for almost everyone.

    I am not sure if you wanted a flat tax plus a consumption tax, but the Federal government would still need to raise the same revenues, so whether you pay a payroll tax, or you pay a consumption tax, the same amount of money would have to be extracted from the citizens. There would be no lot of extra money to spend.

    Consumption tax would significantly impact the middle class much more than the rich or the poor. Imagine if you have to pay an extra $4,000 on a car purchase. Who would that impact more?

    I know you don’t want any of these outcomes. So I wonder under what scenario you’d like these principles to be true.

    • Mike, I feel very sorry for you. If this is the center of your life you need to get out more. As discussed above, I comment when I have a chance. Sorry it’s not in your time frame.
      This post is difficult to go line by line so I’ll try to pick out the salient points. I’m sure I’ll leave out some “important” point (in your mind), but I’ll do my best.

      I don’t think you fully understand why the derivatives market allowed Fannie and Freddie to operate and why it is in the largely unregulated derivatives market that the blame falls. I know it’s conservative lore to blame the House Banking Committee. It is important to conservatives to deflect blame away from their insistence on unregulated financial transactions.

      Conservative lore? That’s one I haven’t heard before. There is plenty of blame to go around for many, but when you have members of the House Banking Committee taking advantage of deals and rewarding their friends with cushy jobs, that seems to be a glaring problem. The fact that people like Dodd and Frank were knee deep is immaterial. Prominent Republicans have been involved in all kinds of shading dealings in other areas – it doesn’t make the situation right. Quite slimy in my thinking.

      Some mortgages are too risky to sell. They needed a risk mitigation plan. Derivative are very complex instruments that used bundling to hide bad mortgages. The mortgages that were too risky to sell were homes bought by investors (flip), no income verification loans, zero down, interest only payments, etc…

      Yes, I know what derivatives are. In simple terms it’s spreading risk over a whole lot of mortgages lumping good with bad. No home should ever be sold with zero down or no income verification. That is a serious recipe for disaster.

      Over 80% of the risky loans were made to people with incomes well above $60,000. I know you’d like to think it’s all ghetto homes, but that just isn’t so — although there clearly were many. Just looking at territory will tell you there are many more homes financed in the suburbs than in any city itself.

      I’ll trust you on the above figures – I have no desire to look it up. Besides, it’s immaterial. The fact that any mortgage lender had such lack standards is unfathomable. Banks were encouraged to lend to as many people as possible to perpetuate the myth that everyone deserves an actual home. Some lower and middle income individuals were put into homes with payments they could not afford. I have applied for two mortgages in my life, both included very close scrutiny of income, assets, liabilities, etc.
      Income really has nothing to do with the equation – if you can’t afford the payments you will eventually be booted out, and rightly so. I like the “take responsibility for yourself” and act like an adult approach, but some would feel that is just plain mean on my part. So be it.

      Your past posts also have an incorrect definition of predatory lending. Although I agree that people who fell for these loan practices were greedy or dumb, there were some like a 70 year old I know who just didn’t know better. Predatory lending is a practice to steal the equity of a home through foreclosure. It works like this: I give you a loan. You think the terms are great, say 4% teaser, never can go up more than 2% per year, and a $30,000 early refi penalty. When that rate hits 8%, you can’t make the payments. I foreclose taking your equity with me. It is now illegal in all states and is punished by significant jail time.

      Yes, this is one example of predatory lending. Those offenders should be punished like any common criminal.

      On the income tax part, the 1% pays 53%, while true, is a bogus argument. I’ll show you that for any tax rate, even for flat rates, you can make pretty much the same argument. For example, under a flat tax rate of 20%, then the top 2% pay 53% of the tax. for a flat tax rate of 10% then the top 4% would pay 53% of all taxes, and so on and so forth. I didn’t pick 20% as an arbitrary number. It is the number we need to meet the current budget. It doesn’t pay for the wars in Iraq or Afghanistan (these wars well all paid so far by increasing the deficit, yes I can prove it). I am not sure if you wanted a flat tax plus a consumption tax, but the Federal government would still need to raise the same revenues, so whether you pay a payroll tax, or you pay a consumption tax, the same amount of money would have to be extracted from the citizens. There would be no lot of extra money to spend.

      All the more reason for massive cuts to the Federal budget. We, as a country, have been lulled into believing that we need to support all of the programs out there. Let’s start with areas the government should be involved with – things like national defense, infrastructure and creating common sense laws. Most everything else is really not a requirement of the government to provide.

      Consumption tax would significantly impact the middle class much more than the rich or the poor. Imagine if you have to pay an extra $4,000 on a car purchase. Who would that impact more? I know you don’t want any of these outcomes. So I wonder under what scenario you’d like these principles to be true.

      A consumption tax would include everyone and give them money up front to spend on whatever they want. Eliminate payroll deductions along with most of the IRS, if not all. A consumption tax would also include everyone not currently paying tax on their income. When you let the citizens spend their money on what they want they will spend more and the government will collect more. This would also spur business growth contributing to the overall health of the economy. It won’t happen so any discussion is really moot.

      • You are math challenged if you think for one minute that a consumption tax will give you more money to spend. It will make everything more expensive.

        Take for example buying a car. Let’s say the price stays, but I have to add a 20% tax. Now the price is $2-4k more expensive. Most people don’t pay that kind of money on taxes, so most people won’t have the extra cash on hand to spend. Down goes the car market, Oooops!

        The same goes for food. You normally spend $5-$15k on food. If you don’t have the $2-4k for a car how are you ever going to have that kind of money for food.

        Consumption tax only looks good to the math challenged. That’s something to feel sorry for.

  6. no answer?

    Let me summarize Fannie Mae: without derivatives they couldn’t sell their mortgages.

  7. FYI, your description of derivates is not accurate, not by a long shot.

    A derivative is an instrument that assigns the risk of an instrument to a third party. Bundling dilutes the risk, but it does not eliminate it. Derivatives allows me to sell you a bond that is totally risk free. All defaults are covered by derivatives.

    One way to cover the risk in a derivative is to place short term bets on its value. For example, I may say that the value of a derivative product will only increase by 2% in the next 30 days.

    I can then sell that insurance policy at a value that covers the 2% and then some. You make money if the bet is correct, you lose if it is wrong.

    Why do this? Insurance always make a lot of money.

    It is because of derivatives that many on Wall Street bet that we now have significant new financing products to manage risk.

  8. Rob,
    Love your rants and the arguements you make with Mike.
    Mike seems hell bent on dicrediting you and making himself look smarter. Maybe he’s got his own website he’s trying to poach people over to. He also sounds like he might be a recent “econ” student from one of those “Liberal Arts” colleges, and is trying out his newfound smarts. I wonder if Mike has anything profound to say outside of his comfort zone; like foreign affairs, state’s rights, or the political process itself.
    I find myself agreeing with just about everything you express an opinion on. I too, “grew up” on Rush and later found a lot of good inspiration and entertainment from Glenn Beck. Keep up the good work and don’t let the Mikes get under your skin.

    • Welcome to the Rant Brian. Hope to see you back here and commenting.

      Mike is actually a pretty intelligent guy and very well read, but with opinions I rarely agree with. He’s a true believer. I wish he did have his own website, but will all the comments on my site and others, he has little extra time. No one ever gets under my skin and I can’t be offended – it’s just the way I’m wired. I actually love opposing views and it only makes my arguements more informed.

      And…I love Glenn Beck regardless of what the left thinks about him. I suppose that makes me a radical in Mike’s world.

      If you enjoy my site and opinions, I have some college friends who started a website about a year ago (www.thegreatillumniator.com) that has been getting some attention. I have nothing invested in their site but enjoy reading the back and forth (and Mike also comments there).

      Again, thanks for commenting.

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