Maybe I should have said “government production,” because that’s what most think government does. “Let’s get a grant from government,” “Let Uncle Sam pay for it,” “That’s Washington’s problem,” or phrases like that, dominate the news media day after day, week after week, and year after year. If someone or some governmental entity at state, county or city level doesn’t have the bucks, they apply for a grant or palm it off to the D.C. Gang. Washington D.C. has become a bottomless pit for largess. Need a new bridge? Need help for restoring a historic site? Want rapid transit? Need a train ride or airplane trip? Get Uncle Sam to pay for it. Want to go to war? Homeland defense? Crop subsidies? Price supports? New Airport? Help for the poor? Medical Care? Fine! We’ll print up the money to pay for it, and no one’s the worse off. The federal government can do anything it wants, because it can print and run up deficits till the cows come home, and all’s well.
Ask yourself the simple question: “What does government, at any level, produce?” Answer: Nothing. At the federal level, where most of the taxes go, what does the D.C. Gang produce? Do they make guns? Nope, they just buy them. Do they make fertilizer, cars, shingles, sugar, or telephones? Nope, they just regulate their production, and charge a tax on all manufactured items. Do they make baby cribs, or just tell the manufacturers how to do it? Do they make autos, or merely tell the manufacturers how much fuel mileage they must get, how many air bags and seat belts they must have, what their exhaust pipes must contain, how many sharp objects are allowed, and out of what materials they must be made? Since they do not make autos, but set the rules, is that all? Oh no! They levy a tax on every single item in that car. There is a tax on every single pound of steel, kilowatt of electricity used in the factory, therm of natural gas used, every tire, steering wheel, brake pad, and alternator used in that car. There are taxes on the factory which builds the car, taxes on the oil and gas wells, and taxes on the electric generating plant which supplies the electricity. There are taxes on the wires delivering the electricity, and pipes which deliver the oil and gas. There are taxes on every truck, railroad car, fork-lift, locomotive, machine tool, and light bulb. There are taxes on the manufacturers and employees of the entire chain of trucks, railroad cars, fork lifts, locomotives, machine tools, and light bulbs.
Examine the entire chain, see how bad it is, and why manufacturing has gone abroad. Take a single item we all use. Bread? There are taxes on the gas used in ovens to bake the bread, taxes on the manufacturer of the ovens, and taxes on the manufacturer of every single component of the ovens, be it a thermostat, gas valve, burner, or insulation. The flour came from a farm originally in the form of grain. The farm was property taxed, as well as everything on the farm, including machinery, fuel, building materials, fertilizer, and maybe even the water used to irrigate. The grain seeds had taxes on them, plus taxes on the producer of the seed, and all of the individual components of seed manufacture. The grain was probably stored in an elevator, awaiting transport to the mill. The elevator has property taxes on it plus taxes on the utilities used. The components of the elevator, such as conveyor belts, blowers, lids, etc., all had taxes levied on them and their manufacturer.
The grain was picked up by a train, and every single square inch of a railroad, including its right of way, track, maintenance machinery, spikes, ballast, rail, signals, fuel, radios, employees, and even computers and paperwork all have property and myriad other taxes levied on them. The train took the grain to the mill, where it was ground up into flour, and the exact same chain of taxes applies at the mill. Even the insurance in the entire chain has taxes on it. The entire chain has taxes approaching in some cases, and in some cases exceeding 50% of wages paid. That’s 50% of the wages of every train conductor, engineer, dispatcher, signal repairman, billing clerk, and shop employee. 50% of every wage of everyone who drives a truck, plows a field, mills grain, builds ovens, runs a train, works in an office, bakes bread, and even manufactures the bread wrapper and ink used in the wrapping. The chain is really endless.
Not a single employee, building, raw material, transport, or even the most microscopic thing or material used in baking a loaf of bread, escapes taxes. Not a single one. Then, when the bread is sold, the taxes go on all over again. The cash register maker had taxes on every single piece he used, plus his employees, transport, sales, etc. of that cash register. The display cases, bags, lighting, heat, and even licenses must be considered. Property and employee taxes on the shop which sells it. Health inspectors, insurance, and miles of gobbledygook involved in making anything, selling anything, transporting anything, advertising anything, is all traceable to government at all levels, and especially the D.C. Gang. This has just been a casual examination of a simple loaf of bread. A loaf of bread, which may sell for $1.50, may cost about a nickel, if the taxes at all levels were removed. What has government ’produced?’ About $1.45 in taxes on a $1.50 loaf of bread, and that’s about all.
America is a highly litigious place. We have lawyers everywhere, and all are anxious to threaten or sue at the slightest provocation. Shakespeare was correct when he said, “The first thing we do is shoot all the lawyers.” Admittedly this is out of context, but we all feel that way at one time or another. I have been victimized by lawyers many times, and I am not alone. Like government, lawyers produce nothing, but are a large cost of doing business. It is said that America has 70% of the world’s lawyers. America, I am certain, has a larger government and larger taxes than any other nation. Maybe other nations have larger income taxes, but the taxes levied on every single smidgen of any physical thing, coupled with costs of legal protection against suits, all go to make making anything in America, extremely expensive.
We have to eat, but even the food we eat comes from lower taxed lands. It is said that 39% of the food we eat, comes from places other than America. Why? Because it costs so much to make, mine, or grow anything here, including food. It costs so much to hire someone to tell you about your bank balance, mortgage terms, or travel possibilities, that a lot of this has gone to India. Think of the 50% taxes, (workman’s comp, unemployment, Medicaid, FICA, income, etc.), on each employee to answer the phone, and you can see how it makes sense to hire someone in India for a buck an hour, or less, teach them American pronunciation, pay the long distance phone bills, and come out way ahead. It is not a pleasant picture. Think of the same process when it comes to manufacturing of all sorts, be it equipment, electronics, computers, machinery, or anything rolling off of a production line in a factory.
Government in Washington D.C., which I call the D.C. Gang, taxes everything, produces absolutely nothing, and makes making everything so cost-prohibitive, that the business goes overseas. We in America are extremely smart, inventive, and innovative. But we cannot fix what the D.C. Gang has done to us. They live in their own little world, and each day, make life more and more difficult. When they pass out grants, provide welfare, and handouts of every conceivable kind, and then tax everything to death, they accomplish two things in the main. (1) Drive business and manufacturing overseas, and (2) Debase the currency. Both of these result in an eventual lack of capital, for at least two reasons. (1) The buck becomes worth less and less, till these words are combined, (worthless), and (2) All our capital has been transferred to other lands, from whom we buy virtually everything we consume. One cannot siphon gas from a tank forever. Eventually the tank’s supply is exhausted. One cannot print and transfer dollars out of America, and into China, India, Japan, and Mexico forever, and maintain any value. One cannot print true capital. One can only print paper money. Real capital is not printable. Real capital is gold, silver, buildings, land, machinery, and tangible, useful things. While the foolish nations we export our paper dollars to, still export their tangibles to us, how long can this continue? When will they stop this exchange of worthless paper for tangible stuff? I just do not know, but if one examines the entire situation, and uses logic while doing so, it simply cannot go on forever. Security is not found with paper dollars and dollar denominated instruments, but with tangible things such as gold and silver, which have always had real value and protection. Protect yourself.