On the FOX financial show, "Cashin' In," on July 11, a discussion broke out over a new scheme to subsidize employers' hiring of ex-convicts. The plan would give employers $2,400 in tax credits and some new, free, government insurance against theft by the ex-cons.
Now, nobody said as much, but this may be response to the sudden surge in the ex-con population, as bankrupt states with overcrowded prisons voluntarily or by court order are emptying cells early, wholesale. It may even be a good idea, given that recidivism is costly and the number one factor in recidivism, particularly for first offenders, is the inability to secure honest employment - and keeping a convict in prison costs about the same as twenty of these tax credits. The discussion quickly disintegrated to debate over favoring ex-cons versus military veterans vs. long unemployed folks with homes in foreclosure vs. even illegal immigrants.
But whether this or just about any other new way to spend taxpayers' money is a bad or brilliant idea is presently irrelevant. We have no money for ideas. What part of broke is incomprehensible? If I am broke and my family has a good idea, say, fixing the leaky roof that will get worse if left in disrepair, or a bad idea, like leaving the roof leaking and taking a vacation - maybe via private jet to Vegas - the relative merits of the competing ideas are irrelevant. I'm broke. I have no money for ideas.
Until I cut back on other expenses and increase my income, not by theft or phony rearrangement, in order to make room in my budget for new ways to spend, there's zero point in a family meeting discussing new ways to spend. Zero. By the way, unlike the government, I have a budget.
Legitimate income increases, for the broke and feckless federal government, cannot come through punitive new taxation of selected people or companies - more revenue is lost than gained. The directly confiscated sum always pales in comparison to the tax revenues lost to the further sag in the economy. All those nasty rich people who don't need to buy anything sit back and stop buying. They can afford to donate as they wish but they donate less. They have no need to take investment risks, so they don't.
There are already trillions of idle dollars, parked, waiting. Start slapping the rich with new taxes, capping deductions, taking away deductions and watch them park more money. Watch 9 percent unemployment become 12 percent.
Legitimate revenue enhancement comes only through growth of the economy, prosperity for those who pursue it, jobs created for all who want them, home values rescued by the demand for them from investors and buyers. That cannot come by confiscating more dollars from me, running them through the great government money-shrinking meat-grinder, and spitting what little is left into someone else's hands. That is merely re-distribution, with loss in transit. Re-distribution creates nothing but power for those doing the re-distribution. Taking more from me creates no job for anyone.
At this family meeting, the only subject open to discussion should be cutting spending until the family has proven it can and will cut all the spending it can. Then, after that occurs, at a later family meeting we can discuss revenue enhancement. Then, after we have first slashed spending, later enhanced revenue, we can discuss new ideas. Until then, nobody's allowed to mention tax subsidies for hiring convicts or building windmills out of peppermint candy or any cool new idea.
Which brings us back to the only approved conversation. It's simple. It has only three parts. Part 1: we are broke. Part 2: trying to fix being broke by taking more money out of the real economy, regardless of who we take it from or how, will be counter-productive at least in the short-term, and besides that, giving more booze to binging alcoholics and their Alcoholic-in-Chief is a fundamentally bad idea. So, no talk of revenue enhancement. No talk of balanced approach either. This is no time for balance. Balance is a luxury we can't afford. Part 3: what are we going to cut, how, how can it be done fast? - totaling up to 100% of the red ink we need stemmed, to living within a budget appropriate to our financial position.
Got a nifty new spending idea you want to call an investment to win the future? Shut up about it and store it until we've paid for the past. Think it'd be great to tax somebody in some new way you can label as something other than a tax increase - sorry, no revenue enhancement either. Just cutting. That's it. That's the entire conversation.
On a show like "Cashin' In," when a subject like spending on a new idea comes up, they need a very loud, aggressive, screaming parrot who knows only one sentence. "Polly wants more crackers but can't have them because - we're broke."
