"Change has Come to America"

Obama in his acceptance speech declared:

"It's been a long time coming, but tonight, because of what we did on this date in this election at this defining moment change has come to America.

Now that Obama has officially been elected President, and the Democrats have a majority in the House and Senate, there is no doubt that CHANGE will come. What election day shows is that 52 % of Americans HOPE for something different than today's financial crisis bad enough that they are willing to allow someone who has never managed anything, but who speaks soothing words, lead them through and out of one of the toughest situations our country has faced.

There is no doubt that Obama, Nancy Palossi, Harry Reid, Barny Frank, Chris Dodd and company, who have been chomping at the bit to CHANGE America, will start immediately now that they believe they have a mandate, to initiate their CHANGE.

One Good Change that Can Happen Immediately

There is one CHANGE that will be positive from his election, if it is kept in perspective. If having an African American President makes African Americans think better of themselves and believe that they can individually develop themselves and succeed that is great. We are all children of God. We all can become great. There are many other African Americans who have proven in the past that they can become great. These are those who have resisted the imposition of perceived limitations by others.

HOPE AND PRAYER

In Barack Obama's superbly crafted and delivered acceptance speech he appeared as the perfect patriot, who will work with everyone, and deliver everything. He presented his carefully crafted promises that anyone would HOPE could come true. Everything was perfect until he made the next statement, and then did you see the faces of those in his crowd?

Obama:

"This victory alone is not the change we seek. It is only the chance for us to make that change. And that cannot happen if we go back to the way things were. "It can't happen without you, without a new spirit of service, a new spirit of sacrifice.

I Hope and Pray:

• That the sacrifice we are asked to make will not ruin our economy by making energy costs skyrocket and taxing jobs out of business
  
• That the sacrifice we are asked to make will not cost our security
  
• That the sacrifice we are asked to make will not cost us our constitutional rights

Obama:

"In this country, we rise or fall as one nation, as one people. Let's resist the temptation to fall back on the same partisanship and pettiness and immaturity that has poisoned our politics for so long."

"But I will always be honest with you about the challenges we face. I will listen to you, especially when we disagree. And, above all, I will ask you to join in the work of remaking this nation"

I Hope and Pray:

• That Obama will magically depart from being the most liberal voting record, who has only voted across party lines once or twice, when he basically had no choice if he wanted another portion of a bill to pass
  
• That despite having a majority in Congress and the House he will have the courage to stand up to his fellow party members, as his predecessor tried to do, when congress ruined our economy by voting against any oversight that might ruin their plans to flood the market with unrealistic loans that could not be re-paid.
  
• That Barack Obama shows any respect and really does listen to his advisors, those across the aisle, and even his critics rather than showing his arrogance.

Obama showing his respect for John McCain while talking about him at a rally just prior to election day just as he did with Hillary in April

Obama:

"Let's remember that it was a man from this state who first carried the banner of the Republican Party to the White House, a party founded on the values of self-reliance and individual liberty and national unity. "Those are values that we all share. "

I Hope and Pray:

• That Obama really does mean he shares the value of Self-Reliance and will not try and grow the government by taking over our right and responsibility to manage our own economic futures.
  
• That Obama will respect our individual liberties that are currently guaranteed in the constitution to own firearms and to speak our minds in opposition, as well if we are conceived to have our opportunity to live.
  
• That Obama will actually try to unify by seeking common solutions, rather than driving his liberal agenda.

Obama:

"Tonight we proved once more that the true strength of our nation comes not from the might of our arms or the scale of our wealth, but from the enduring power of our ideals: democracy, liberty, opportunity and unyielding hope."

Hope and Pray:

• That Obama does not weaken our military strength and economy like FDR and other presidents did, that put in a position of weakness just prior to World War 1 and again just prior to World War 2. Much of the world today depends on the US having both Military and Economic strength. There are several parties that are just looking for the US to become weaker so they can take advantage of our weakness.
  
• That Obama does not sell out Israel's rights.

I HOPE for CHANGE. I hope Barack can at least be more like the Barack who has sold himself to America, than the Barack of the past 20 years that we were not allowed to know. After all, like it or not he is right when he said "And to those Americans whose support I have yet to earn, I may not have won your vote tonight, but I hear your voices. I need your help. And I will be your president, too." I HOPE he listens to our voices. He has four years to show that he represents us rather than trying to rule us.

My Experience With An Election for "Change" in 1970

As a Reminder I am covering these topics:

1. A Land of Opportunity
2. The Economy -1
3. The Economy -2
4. Energy
5. National Security
6. Education
7. My Experience with an Election for "Change" in 1970 (Current Topic)
8. The Change We Need
9. Growth, Challenges, and Choices

I want to share my experience and political lessons learned as a Missionary in Chile from July of 1970 to May of 1972. While I was on a mission to serve the Lord, one only had to observe the significance of the "Change". I hope that the similarities between that election and the current election do not provide a prediction of our future in the United States, but there are similarities

The Election

When I arrived in Chile in July 1970, there were three months left before presidential elections. At the time, Chile unlike most other Latin American countries had enjoyed the third most stable democracy in the western hemisphere only falling behind the USA and Canada. In Chile, presidential terms are for 6 years and you are not allowed to serve more than one term, and the political environment is made up of several parties, but there were 2 primary parties, with one that had been growing in recent years. Polls were not popular at the time. The way elections were conducted, the candidates would hold individual rallies, and throngs of supporters would show up in mass. The paper the next day would show a picture of the large crowds with a headline about how many people showed up.

With three primary candidates, Jorge Alessandri (a prior president) of the Conservative Party, Radomiro Tomic of the Christian Demotratic Party, and Salvadore Allende , a member of the Socialist Party and of the Unidad Popular coalition of Socialist and Communist parties, each day would show a different headline, 250,000 support Allende, 350,000 rally for Tomice, 500,000 show up for Alessandri. Having lost 3 prior elections by large margins, Salvadore Allende was not considered a likely winner.

His promises to the Chileans?

• Redistribution of wealth (Socialism) - Increased taxes of the wealthy and large business to redistribute to the poor
• nationalization or strong handed regulation of large-scale industries (notably copper mining and banking)
• Government administration of the health care system
• Government administration of the educational system
• A program of free milk for children
• A plan of land seizure and redistribution
• Improve the socio-economic welfare of Chile's poorest citizens
• Provide employment, either in the new nationalized enterprises or on public work projects

In accordance with Keynesian economics, he wanted to implement a massive redistribution of revenue by raising salaries and increasing public expenditure, through which the buying power of the population would increase and accordingly consumption in general. These measures would activate the idle capacity of the Chilean productive apparatus (which was relatively large) and generate a climate of prosperity. If this strategy paid off, it would have had the effect of strengthening the government’s position and allowing it to advance its revolutionary program much faster^[1]. Wikipedia

When the elections occurred, the Unidad Poplular hired buses and drove through the poorer areas of the country, both in the city as well as in the agricultural areas, and hauled people to the polls to vote. Meanwhile, many of those in the Conservative party, overconfident that they had the lead, did not show up to vote. The result:

On 4 September 1970, he obtained a narrow plurality of 36.2 percent to 34.9 percent over Jorge Alessandri, a former president, with 27.8 percent going to a third candidate (Radomiro Tomic) of the Christian Democratic Party (PDC), whose electoral platform was similar to Allende's.

Wikipedia

The Aftermath

As a person on the street, I noticed the "Change" immediately. As a missionary, we talked to people every day. When I arrived in Chile, we were always invited in to peoples homes, and they were very friendly and open. Right after the elections, people were concerned and cautious. They were less friendly and guarded about what they would say.

Chilean presidents were allowed a maximum term of six years, which may explain Allende's haste to restructure the economy. Not only did he have a significant restructuring program organized (the Vuskovic plan), he had to make it a success if a Socialist successor to Allende was going to be elected. In the first year of Allende's term, the short-term economic results of Minister of the Economy Pedro Vuskovic's expansive monetary policy were favorable: 12% industrial growth and an 8.6% increase in GDP, accompanied by major declines in inflation (down from 34.9% to 22.1%) and unemployment (down to 3.8%). However, these results were not sustained, and in 1972, the Chilean escudo had runaway inflation of 140%. The average Real GDP contracted between 1971 and 1973 at an annual rate of 5.6% ("negative growth"); and the government's fiscal deficit soared while foreign reserves declined [Flores, 1997]. The combination of inflation and government-mandated price-fixing, together with the "disappearance" of basic commodities from supermarket shelves, led to the rise of black markets in rice, beans, sugar, and flour.^{[14] Wikipedia}

Additional actual observations:

• The Allende supporters among the poor, felt like they won the lottery and many immediately left the farms they worked or other jobs and invaded the cities, strutting like they were king. About a half a year into his term, these supporters would move into people homes, when they were away on vacation and take over possession. They would put a Chilean Flag in the window symbolizing they had nationalized the house. When the people came home, the government/police would not remove the intruders, thus backing up the nationalization.
• With threats to their businesses, many businessmen who were able, left the country to salvage their wealth, protect themselves, and take their businesses to other countries.
• The laborers, expecting promised wage increases, would strike against their employers. The employers, faced with higher wages and unprofitable business would close their doors. To protect the economy, the government nationalized the businesses, paying employees with printed money, because the expected revenues from business did not materialize.
• The government, nationalized the large businesses (the copper mines and the banking industry) that they said were making exorbitant profits. Production in the mines went down, and tax revenues declined as well. These are the reasons why they ran into run away inflation and negative growth.
• As production declined, shortages were found of many staples. During his second year, the rally's in the streets were now marches of mothers with pots and pans protesting shortages. Simple things like toilet paper were not available, and one had to make use of newspapers and magazine pages. Meat an milk were not to be found. If you could find Chicken you were very lucky.
• Cuba, the Soviet Union, and China all became great pals with Allende, but they could not / would not help sufficiently to make a transition.
• To gain control, newspapers and radio stations were forced to close.
• Every week, if not every day, opposition members of press, government, etc would be attacked, and frequently killed.

A Necessary End

There were rumors of a possible coup since at least 1972; in 1973, partly due to Allende's economic policies, partly as a result of the rapidly declining price of copper (Chile's main export), but especially because of lock-outs and sabotage by factory owners, the economy took a major downturn. By September, high inflation (508% for the entire year) and shortages had plunged the country into near-chaos.^[23]

On 29 June 1973, a tank regiment under the command of Colonel Roberto Souper surrounded the presidential palace (La Moneda) in an unsuccessful coup attempt known as the Tanquetazo.^[26] On 9 August, General Carlos Prats was made Minister of Defense, but this decision proved so unpopular with the military that, on 22 August, he was forced to resign not only this position but his role as Commander-in-Chief of the Army; he was replaced in the latter role by General Augusto Pinochet.^[25]

In August 1973, a constitutional crisis was clearly in the offing: the Supreme Court publicly complained about the government's inability to enforce the law of the land and, on 22 August, the Chamber of Deputies (with the Christian Democrats now firmly uniting with the National Party) accused Allende's government of unconstitutional acts and called on the military ministers to assure the constitutional order. Among other things, Allende was accused of disregarding the courts, attempting to restrict freedom of speech, and supporting unauthorized seizures of farms and private industry for the purpose of establishing state control of the economy. The Chamber of Deputies also attacked Allende for seeking to "establish a totalitarian system absolutely opposed to the representative system of government established by the Constitution."^[27]

In early September 1973, Allende floated the idea of resolving the crisis with a plebiscite. His speech outlining such a solution was scheduled for 12 September, but he was never able to deliver it. On September 11 1973, the Chilean military staged a coup against Allende. Wikipedia

A year before, this all occurred, I could see that there would be a military coup. The people were in misery, and with a member family who was a Colonel in the Army, I could sense that there were things in motion.

How Does our Situation Compare

I can't turn to wikipedia for this part, as history has not yet been written. However, while I hope and pray that history is not an indicator, I believe the comparisons are similar enough provide at least an indication of the possible "Change" we may be prepared to endure.

Promised Change - What People Want to Hear to Get Power to Do His Program

Allende 1970	Obama 2008
Government administration of the health care system - Nationalized Healthcare	Healthcare for all: - His current Plan is to Negotiate (force) Insurance Companies to: Lower Costs Accept Pre-existing conditions Force employers to pay a insurance fee into a pool to help fund if they do not provide insurance Provide the option for employees to buy into a Government Program Likely Result: Obama has stated publicly on more than one occasion that his goal is a single payer healthcare plan - Nationalized Healthcare / not private insurance Once the Government is involved, they take a hand in all facets of the program, including when and who you can see for healthcare. Insurance companies will withdraw due to lack of profitability Government will bail out program - Nationalized Healthcare
Government Ownership Large Business and Banking Nationalized biggest industries Copper Mines Banking Bailed out / Nationalized many Factories Took over ownership of many estates and private properties Business struggled under government ownership and false economy, many moved to other countries.	Banking and Housing is already on verge of collapse due to liberal credit programs created and protected by his party The Bail out program initially placed on the table by him and his party took ownership. The current president recently initiating steps in bail out to buy interests in banks with guarantees that Banks can buy stock back. Currently in precarious position, that a Government that wanted to could trigger the Nationalization of the industry. Seriously critical of Big Business, and wanting to impose prohibitive taxes, and impose stiff regulations. (Energy, Insurance, Banking, Pharmaceutical) Likely Result: The Party with the desire and power (presidency & congress) could push the Housing Market and Banking Industry into situation where the government "has to" bail it out again and take complete ownership. Businesses will move to other countries taking jobs with them, if the environment prohibits them from surviving and competing.
Government administration of the educational system Government control of curriculum (including propaganda)	Government administration of the education system Obama says reasonable things here More money to education Keep better teachers / remove poor teachers Improve math and sciences Charter schools Democrat and Obama's background and history show a different view Tight relationships with Teachers Union Protects the teachers (good and bad) Fights against competitive practices (that make schools compete for quality for $) like vouchers Fight against standardized testing saying the must teach to the test Incorporates liberal propaganda because loyalty to liberalism protects their union. Funds other liberal agenda items like the California Teacher's union did yesterday by contributing funds in support of Gay Marriage. (what does that have to do with education?) Experience in Chicago with Annenberg Challenge, Woods Fund, and Bill Ayers as they funded education programs that failed to achieve improvements in math and science, but which "are explicit about the need to indoctrinate public school children in the belief that America is a racist, militarist country and that the capitalist system is inherently unfair and oppressive."

Oblivious Citizenry

Allende 1970

Obama 2008

In 1970 the citizens of Chile understood the views of Allende, but with the rallies showing little support, and he having lost by large margins in 3 prior elections, they did not believe he would win. It is for this reason that many took the election lightly and did not show up. To the poor, his message was strong and full of nice sounding promises that were based on ideology rather than economic principle. They were oblivious to the 'Change" that was to come.

In 2008, the citizens of the US are oblivious in another way. Many carry a guilt, about the racism of the past, and if there is a qualified black candidate, they are willing to overlook a few problems. The main stream press, who has the most citizen ear share in the rapid pace of life today, for what ever reason protects him from any attacks by labeling legitimate questions and objections as smears. Any questions about his background are labeled as racist, and spun to the public as unfair questions A large number of shallow citizens place value on how the candidate appears or sounds, but don't ask any further questions about the reality of what he says. Taking advantage of the situation, Obama and the machine with the press included: Eloquently craft their message to be appealing to groups The Poor Not only are you not going to have to pay taxes we will pay you a credit We are going to give you health care We are going to give you loans and cheap housing The middle class (they were not strong here before so they have expanded their message) We are going to give you a tax break We are going to reduce the cost of healthcare We are going to create more jobs We are going to pay for your education You don't have to do anything because we will take care of it for you. It doesn't matter that they can't do all of this, or that if you looked into his past, which is protected, his ideology and that of all of his associations is completely different from his statements and is focused on Socialism, which shaped his life and associations from his college years in Hawaii all the way through his rise to the Senate. Because of the Race Card and Press Support in Protecting Obama's past what we don't know about him is much more than what we do know. He still has not produced his birth certificate, and there is significant evidence that he is not a citizen. He has not produced any of the records from Columbia University or other sources, which are protected unless he releases them. Might they also indicate that he is not a US Citizen? He has NO administrative experience on his resume other than claiming to manage his own campaign, but that does not bother anyone because of his charisma. The 20 year experience in the Chicago community is protected information

Economic Plan

Allende 1970

Obama 2008

Allendes's objective was to achieve a transition to socialism by democratic means. This would involve a combined political and economic program aimed at wresting control of the economy out of the hands of a small elite and placing it in the hands of the state. It would then be easier to dismantle the various institutions connected with Western capitalism. In accordance with Keynesian economics, he wanted to implement a massive redistribution of revenue by raising salaries and increasing public expenditure, through which the buying power of the population would increase and accordingly consumption in general. These measures would activate the idle capacity of the Chilean productive apparatus (which was relatively large) and generate a climate of prosperity. Wikipedia In other words, he would drive the Economy from the Bottom, by increasing salaries. This would require unionization and pressure on business to do so. The idea being that wealth would flow up as people had money to spend and drive the economy. The Result: Businesses could not be profitable thus they either closed up, moved out, or were nationalized Government is very inefficient at running business Jobs were lost, or the government had to make up jobs and pay with printed money resulting in hyper inflation, a weak currency, and severe economic contraction or recession. Shortages of product on the shelves, due to lack of production.

Obama's unstated, but (thinly veiled) obvious objective is to transition to socialism by democratic means. His plan is to directly re-distribute wealth by taking it (significantly increasing taxes) from anyone / business making more than $250,000, and by removing tax loopholes, and then re-distributing the wealth by lowering taxes (supposedly) and giving rebates to the remainder. He says 95% of tax payers will get a tax reduction. Only 40% pay taxes today, resulting in direct distribution of wealth (welfare) to the remainder in the form of rebates (welfare) for doing nothing. Obama says that only 5% of Small Business fall in that range. In reality more the 50% fall in to that range, and make up the biggest segment of employers in the Economy. His plan is based on the premise that if the people have money in their pockets, they will spend it and drive the economy from the bottom up, similar to the stimulus package. His plan is also to take away any tax breaks for companies that have workers overseas He promises to give a $3,000 credit to employers who add jobs that will cost them $50,000 to create, and if it made sense to create them they would anyway. Likely Result: Businesses will not be profitable and will reduce jobs Those in the higher tax brackets will either close up or move to a country where taxes are not prohibitive and labor is less expensive taking jobs with them. Remember, they operate in a global economy, the success means selling to people who can pay, and keeping cost low. In order to keep the economy running, more bail outs will be required effectively resulting in nationalization of industry Even with higher taxes, when the economy slows down it will result in lower revenue to run the state managed programs, resulting in a need to print money, resulting in hyper inflation, a weak currency, and severe economic contraction or recession Shortages of product on shelves, due to lack of production.

Class Politics and Ideology

Allende 1970

Obama 2008

There was never any question that about Allende's socialist agenda. He ran as a socialist with socialist ideas. He wanted to re-distribute the wealth to the poor by requiring the rich to pay higher wages, and by creating jobs through national programs and industry.

Obama is running a thinly disguised campaign, because if he ran as a socialist, he could not win the vote, but if someone looks past the charisma his ideology is the same. The rich are bad, and the wealth should be re-distributed to the poor, without them earning it. Government is to take more control, by nationalizing the medical industry in steps and extending that process to other industries that will be forced to the brink by governmental intervention and restrictions. Obama in his recent debate, when talking about his relationship with William Ayers, brushed it off as if it were nothing. Obama was 8, when William Ayers was a terrorist, and they were on a couple of boards together. Then when asked who he would have on his cabinet, he named a few people that no one would find offensive, and then said i.e. these are the people who have shaped my opinions. We are now to believe, that these people who he as worked with only in the last two years, while running for office have shaped his opinions more than those who he has worked with, who he has supported, and who have supported him over the last 20+ years? Until they became political liabilities, his associations and support has gone to groups in Chicago and elsewhere that have funded, advised, promoted, and shaped the community there. He brushes off lightly the the 20 years of his life that were spent in Chicago working in the Community with the Annenberg Challenge, Woods Fund, William Ayers, Reverend Wright, etc all of whom spew hatred for the United States as a capitalistic society and demonstrate reverse racism by teaching to hate the white society, and clamor for socialistic change. The William Ayers Plan - Schoolchildren Barack Obama & William Ayers

My Predictions IF Obama and Democrats have a Majority - Based on Experience

As a person who loves the United States of America and the liberties and opportunities it provides, as well as the benefits it brings to the rest of the world through our protection and our benevolence, I am afraid that if Obama and a Liberal Congress are elected to office, we will see one of two things.

1. A slow implementation of Nationalized Medicine and Tax Increases to lull the citizenry into a false sense of progress
2. A rapid implementation of his 95% tax redistribution of wealth plan and nationalized medicine to assure that we make the move quickly and that it is hard to take back.

As in Chile in 1970, you will see in this case the blacks celebrating and feeling empowered to the point of being at the least obnoxious and more likely practicing the things they have been taught, at least in the Chicago communities to the streets.

I do not believe that most Americans, when they realize what they have elected, will want to keep it. Some may even want to take the correction in their own hands, which would result in instant violence. In any case. if the bulk of Americans rise up and try to reverse the socialized situation, there will be worse riots than we had in the 1960's and possibly civil war. It will take 20 years, a whole generation, at a minimum to get American back to what it once was, if it ever happens.

Be prepared, pay off your debts, learn to be comfortable with less, keep your families close, stand in holy places, turn to your Father in Heaven, have Faith.

THE ECONOMY - 2 I CAN NOT SUPPORT THIS TYPE OF CHANGE - WHY?

As a Reminder I am covering these topics:

1. A Land of Opportunity
2. The Economy -1
3. The Economy -2 (Current Topic)
4. Energy
5. National Security
6. Education
7. My Experience with an Election for "Change" in 1970
8. The Change We Need
9. Growth, Challenges, and Choices

While John McCain would not have been my first choice for President of the United States, my current choice is between John McCain
and Barack Obama, and after careful and detailed consideration, there is no question in my mind which is I must choose.  Every day, the choice becomes clearer because of events of the day that confirm it.  While both parties are suggesting change, change can be for the worse as well as for the better.  Unfortunately,as much as I hope I am wrong I fear that we are on the brink of a Major Undesirable Change

Economic Nonsense

People keep saying that McCain needs to come out with more details about his economic plan.  After all, Barack has laid out some details about his plan.  The truth is that McCain does not have to promote the types of things that Barack proposes.  Reactive and Bad Policy do not make things better.  Barack's plan is about change.  No more of the last 8 years.  The Country needs change!    The problem, even when things are bad they can change for the worse when bad policy is applied.

The Truth about the Last 8 Years, of the supposed failed Bush Policy, that no one wants to admit, because of the current sour economy, the image created by a less than friendly ore realistic press, and the desire to politically paint a picture that each candidate has to bring improvement.

• He inherited a waning economy from Bill Clinton
• He Lead the climb a huge hit on the Economy resulting from the 911 attacks on the US
• He submitted  Tax Cuts that caused an Economy Resurgence and Record Tax Revenues (see Truth about Tax Rates...
  below)
• He Was ambushed by the Global Energy Crisis that was created partially, by a Congressional lack of desire to drill and produce oil domestically, lead by unrealistic environmental protectionism. The sky-high gasoline prices Americans paid all summer were effectively an energy tax, brought to us by policies limiting energy production supported chiefly by Democrats like Nancy Pelosi. Higher energy costs, had driven both the airline industry and the auto industry into turmoil, as well as added costs to nearly every product made in the US and globally.  The end result recently being lost jobs domestically.
• He was hit with the Housing Market Crisis that resulted in an at least perceived need for government intervention, and was caused by liberal policy pushed by Democrats to make bad loans to assure everyone can afford a house, and who when oversight and controls were sought by George Bush, John McCain and others, made every attempt to avoid, including a party line vote to avoid tighter credit controls on the institution they protected, Fannie Mae and Freddie Mac.  The result a financial crisis not of his making that has severely damaged the economy.

And now rather than acknowledging the Truth, Barack and the Democratic Congress point fingers at everyone else, and pretend that they are the answer. 

The Truth about Tax Rates vs. Tax Revenues and Economy

An Major Error in Barack's Basic Message of Change, that he Assumes the Younger and Less Informed Will Not Recognize

Barack Obama says in his add- "Well now we know the truth. It didn't work. Instead of prosperity trickling down, pain has trickled
up."  This is a direct reference to Reagan's "Trickle Down" economic's policy which if you look at the real history rescued the US from the
most recent deep recession and produced an economy that boomed with a few fluctuations through the Bush
1 and Clinton Administrations and which was re-vitalized during the Bush 2 administration after 911 until the
Energy and Housing Crisis brought the economy down.

Simultaneously with the enactment of the tax cuts in 1981 the Federal Reserve Board, with the full support of the Reagan Administration, altered monetary policy so as to bring inflation under control. The Federal Reserve's actions brought inflation down faster. As inflation came down and as more and more of the tax cuts from the 1981 Act went into effect, the economic began a strong and sustained pattern of
growth. Though the painful medicine of disinflation slowed and initially hid the process, the beneficial effects of marginal rate cuts and reductions in the disincentives to invest took hold as promised. -US Treasury - History of the US Tax System 

Looking at the above view of the jobless aspect of the economy over the last 48 years,it is clear from history, that while there is a constant cycle of good to bad economy, Tax Reduction on the High Income and Corporate Level us what created jobs by stimulating the economy. The tax increases both inflationary as well as imposed by Carter introduced us into our last great recession. Tax overhaul and reduction by Ronald Reagan's "Trickle Down" economics fueled lasting growth. It worked again to restore the economy under George Bush 2 after 911 and prior to the recent Energy and Housing
Crisis

The Tax Burden Already Bore by the Wealthy

The Congressional Budget Office joined the IRS in releasing tax numbers for 2005, and part of the news is that the richest 1% paid about 39% of all income taxes that year. The richest 5% paid a tad less than 60%, and the richest 10% paid 70%. These tax shares are all up substantially since 1990, and even somewhat since 2000. Meanwhile, Americans with an income below the median -- half of all households - - paid a mere 3% of all income taxes in 2005. The richest 1.3 million tax-filers -- those Americans with adjusted gross incomes of more than $365,000 in 2005 -- paid more income tax than all of the 66 million American tax filers below the median in income. Ten times more. - Wall street Journal Taxes and Income

Up until the recent Crisis there has been a great upward mobility among Americans

America continues to be a society of upward income mobility. Over the past decade, millions of
Americans have joined the once highly exclusive club of six- and seven-figure earners. Some 304,000
Americans earned $1 million or more in annual income in 2005, compared to 110,000 in 1996 and
176,000 in 2000. Because there is no cap on the top income share, this increase in millionaires pushes
the top income (and taxes paid) share higher. The number of millionaire households in net worth also
increased to nine million in 2006, up from six million in 2001, according to TNS, a global market
research firm. - Wall street Journal Taxes and Income

History of Taxes and Bad Economic Times

In October of 1929 the stock market crash marked the beginning of the Great Depression. As the economy shrank, government receipts also fell. In 1932, the Federal government collected only $1.9 billion, compared to $6.6 billion in 1920. In the face of rising budget deficits which reached $2.7 billion in 1931, Congress followed the prevailing economic wisdom at the time and passed the Tax Act of 1932 which dramatically increased tax rates once again. This was followed by another tax increase in 1936 that further improved the government's finances while further weakening the economy. By 1936 the lowest tax rate had reached 4 percent and the top rate was up to 79 percent. In 1939, Congress systematically codified the tax laws so that all subsequent tax legislation until 1954 amended this basic code. The combination of a shrunken economy and the repeated tax increases raised the Federal government's tax burden to 6.8 percent of GDP by 1940. - US Treasury - History of the US Tax System  Beginning in the late 1960s and continuing through the 1970s the United States experienced persistent and rising inflation rates, ultimately reaching 13.3 percent in 1979. During this time, the income tax was not indexed for inflation and so, driven by a rising inflation, and despite repeated legislated tax cuts, the tax burden rose from 19.4 percent of GDP to 20.8 percent of GDP. Combined with high  marginal tax rates, rising inflation, and a heavy regulatory burden, this high tax burden caused the economy to under-perform badly - US Treasury - History of the US Tax System

The Hidden Truth about Obama's Promise to Lower Taxes

Obama Says he will lower taxes on small businesses, but what he is not telling you is that at least 90% of small business are LLCs, Partnerships, and Sub-Chapter S Corporations, and as such are not subject to Corporate Income Tax, but the revenue passes directly to the owners who are Individual Tax Payers, with at least 50% being in the $250k plus category and thus will be subject to taxes of more than 50% and approaching 70%.  If a business has to pay $.55 - $.70 in taxes on every dollar of income, business will look for other ways to invest their money resulting at the best in no new jobs and more likely a  reduction in jobs.

The other truth is that the American Dream stops when you make $250,000.  There is no reason to work any harder, to create bigger businesses, or create more jobs.  It is the American Dream that anyone who desired to work hard and had good ideas could succeed, that made our country stand out.  Under this type of environment, our economy and opportunity will not be globally competitive. Jobs will go overseas, where there are less taxes and lower salaries, and our unemployment will sky rocket.

News Flash - Obama Offers a $3,000 tax Credit to Small Business for Every New Job Created - A Pure Political Ploy

Today, October 13, Barack Obama to show how he will re-build the struggling economy, stated that he will provide small business a $3,000 tax credit for every new job they create, as long as those jobs are still in existence in 1 year.  To the unthinking ear on the street and pushed by the press, this sounds like a very magnanimous offer.  The real truth?  Businesses create jobs to make money.  They do not hire new employees if they do not see a profit in doing so, in which case they will create the job anyway.  For a business to get a $3,000 tax credit after one year, the employer would have to pay the job's wage, let's say it is only $30,000. They have to pay the employer Social Security and Medicare taxes, $3,600.  They have to pay unemployment insurance.  They may have to pay Medical Insurance (a reduced rate under Obama).  The $3,000 tax credit has now cost the company around $40,000 to earn.  If the company can't make a profit, the job still will not be created, and Obama knows it.  When it does not work, he will blame big business for not using the tax credit incentive to create more jobs.

Obama's Inadvertent Admission that Taxation is Bad Policy

A month ago Obama said he would postpone raising taxes if economy is in trouble - He has recently pulled back from that position, since he know that it clearly communicated that he knows raising taxes has a negative impact on the Economy. And If it has a negative impact on the Economy now and would drive us deeper into recession/depression, then why would increasing taxes anytime do anything but hurt the economy?  He steers clear of this statement now, saying he will have to evaluate the situation when he get's in office.

Obama and the Democrat Party's Coming Gift to America

They have already gave us a financial crisis, which they love, because it invited the Government to Step into the position of saving the citizen, and taking more power in the form of owning the Credit Industry. (Nationalization).  In essence they have achieved control over the lending industry, and having control, they will be slow to release it.  They now want control of the medical and insurance industry guised in a fair Healthcare Plan.  They again say all of the things that sound good.  You will not have to pay more.  You will have the same coverage as ...   How will the do it?  They will pressure (force) the Insurance Industry to lower their rates.  Insurance companies, like every other business, is in existence to make a profit to return to investors.  If the Government is going to force the insurance companies to accept lower rates, they will make less money and either go out of business or be bailed out by the benevolent government who will not let them fail, and thus take control of another segment of the free market.  And then we will have Banking, Housing, Insurance, Medical all run by the same inefficient structure that wasted away their first great promise "Social Security". 

I CAN NOT SUPPORT THIS TYPE OF CHANGE!

The Economy - Segment 1

As a Reminder I am covering these topics:

1. A Land of Opportunity
2. The Economy -1 (Current Topic)
3. The Economy -2
4. Energy
5. National Security
6. Education
7. My Experience with an Election for "Change" in 1970
8. The Change We Need
9. Growth, Challenges, and Choices

This is a huge topic and will require a two or more entries - If you really want to try and understand you will read it, if you want to be lead by others you will stop now.

I started this prior to the big issue that recently surfaced related to the need for the Bail Out of financial institutions. However, it highlights the same issues.

Even before the very recent credit industry crisis and bail out, both parties had talked about the bad state of the current economy? Current unemployment statistics of 6.1% is declared by some as record unemployment. A concern for jobs having gone overseas, for a weaker dollar, lower relative income levels, rising costs, lower home values, higher cost of fuel and now the difficulty of getting credit are all issues related to the economy that affect all of our lives.

Today's typical citizen understands very little about the economy. It is a complex topic that at it's base includes supply and demand of all products, resources and services that we produce and use. It includes international trade balances, taxation, national debt, imposed legislative controls or manipulations, and much more.

Unfortunately most citizens accept as gospel what they hear and read from the most convincing source, without giving it any more thought and trying to find the facts. Few have a broad perspective nor look at it from a historical perspective. What they are told and what they see in the moment must be true!

Many believe that the US President is directly responsible and also has the ultimate ability to dictate it's path. At any point in time, he is either to take blame or receive credit for the current state of the economy.

Any President Really Has Little Direct Control. While credit and blame for the economy are usually placed on the President, he really has little control. The events of the last week with the President pushing for a Bail Out bill, and then having to wait for Congress and the Senate to agree on what type of bill they will provide. It is true that the President initiates a budget and tries to set policies, but the budget that results is more a factor of what gets added and/or subtracted by congress before they approve it. Likewise, the affect of legislated attempts to drive more and more taxes, exemptions, spending, credits, etc. have significant affects on the economy, that the President can only veto, twice. If congress wants them bad enough, they will get through many times attached as a part of a bill the the President wants to pass and knows that if he does not approve it, he will never get what he originally wanted. The key is to understand that a President with a bad agenda can be controlled, but a President coupled with a congress that is willing can bless and curse the state of the economy.

Election after election, the US populace listens to the same pleas from both candidates, highlighting how they will bring a difference to Washington. This election, what Obama promises is big change, and hope through talking about how he will implement policies that will provide healthcare, new energy sources, more jobs, and help for the middle class. McCain promises that he will bring change in Washington, by getting rid of wasteful spending, getting bi-partisan cooperation, and removing obstacles and barriers to progress. These are the same types of promises that have been made by candidate after candidate for at least the last 10 elections. What Obama suggests is nothing new, nor is what McCain suggests. The question, really is who has the best chance of making it happen, and if they were to succeed, what will be the affect on the economy, security and well being as a country. The Economy affects our day to day life styles, security allows us to have a life. Our well being as a country, is our ability to continue succeeding.

Since, neither candidate is really promising anything new, we can look at historical trends to determine what the impact of different implementations of economic policy have been. To do so we really must first understand some basics about the Economy.

The Base Principle or Natural Law of Economy is Supply and Demand

The principle applies to all things. If we want something enough (demand) and there is little available(supply), then we will pay what is required to get it. If there is an over abundance of availability (supply) the owner will have to charge less to generate enough demand to sell it.

This is true of Oil(price per barrel), Credit (high or low interest rates), Salaries & Wages (availability of people with required skill), Dollars (the more in circulation(supply), if not invested(low demand), the lower the value).

A recent example of Supply and Demand is the price of Oil. While there are many who would try and convince you that the price of oil is controlled by the big oil companies, it's price is controlled by the natural law of Supply and Demand. The global expansion of consumption by emerging countries like India and China are driving up DEMAND, while the owners or Suppliers (OPEC, Venezuela, Mexico, Russia) determine how much they will produce to control the price. (It isn't supply until it is out of the ground.

When the (SUPPLY) of money is more available than the DEMAND for loans credit is cheap both in terms of Interest Rates and ease of conditions. In the 1980-83, when we went through the last big recession, mortgage rates went above 13%, because companies did not have money to loan. For years afterward, the current credit rates of 6-7% rates were considered very good. You had to have a minimum of 5% down for first time buyers, and there was no such thing as a no income verification loan.

Salaries - Jobs that requires special skills and training result in lower numbers (SUPPLY) of people skilled to do those jobs, and as long as there is a DEMAND for them salaries are high. While jobs that require less special skills and that anyone can do have less value.

The Interrelationship of Different Economic Market Elements

While each element, like Salaries, Credit, Commodities are governed by their Supply and Demand constraints, they also are influenced and are dependent on each other.

As an example, lower supplies of oil mean higher prices for fuel resulting in higher costs of doing business, and higher prices of the business products, resulting in lower demand for the product, resulting in either fewer jobs available or lower salaries.

Another example: higher cost of credit, means higher costs to business, resulting in a higher product prices to the customer, resulting in fewer sales/customers, resulting in less jobs or lower salaries

A World Economy

In today's world, with rapid and relative inexpensive forms of transportation, the economy is global. Global markets compete for the same SUPPLY of resources. Global markets create more competition for Products, Commodities, and Services at competitive prices. Businesses now supply products across the world and to stay in business a company has to compete with other businesses from around the world for the customers who demand the product. In the US we have seen the demand dwindle for our automobiles, because we were too slow to adapt the same quality focus as Japan and because because of our higher salaries we had to reduce local plants and accept production of many parts overseas to stay cost competitive. Korean companies provide quality lower priced products because they use lower priced labor, and to compete we must use lower cost labor as well. I will discuss the problems associated with legislating against supply and demand in a later topic.

Chaos Theory - Uncontrollable and Consequential Events Happen

This principle became popular in Jurassic Park to explain that trying to control nature was impossible, and that nature will find a way. The same principle applies to the Economy. There are unexpected events which occur that the Government has no control over. Events like the 911 attacks, weather events, and earthquakes can severely disrupt the economy. After 911 the Airlines almost all went out of business because few people would fly them. Almost all business had to cut back. Costs were high, and jobs were lost. 911 had almost an identical impact as the sudden surge in the price of oil, due to global demands being higher than global supply.

Sometimes events are also the result of trying to control the natural law of supply and demand, and eventually natural principles find a way to dish out the consequences. These events can be years from when the policy was put in place. We are experiencing this today, with the global credit crisis. I will discuss this later related to the impacts of governmental regulation.

My next blog will address the affects of governmental regulation of the economy.

A Land of Opportunity

As a Reminder I am covering these topics:

1. A Land of Opportunity (Current Topic)
2. The Economy - 1
3. The Economy -2
4. Energy
5. National Security
6. Education
7. My Experience with an Election for "Change" in 1970
8. The Change We Need
9. Growth, Challenges, and Choices

One of the greatest things about our Country, the United States of America, is the freedom and opportunity it provides. There is no question the inspired leaders established a constitution that provides great benefits to all of its citizens. The opportunity available to succeed here, which is why so many around the world want to come here, is legendary. This has occurred over the entire history of the country. Is life perfect for all it's citizens? No! It never has been and never will be. Are all of the citizens perfect? No! But life here, opportunity here, and the living standard here is currently as good or better than anywhere else on earth. Because it is so good here we, as Americans, have taken it all for granted.

During the National Conventions for both parties recently, I heard over and over from individual candidates how they have lived the American Dream.

Barack Obama

My father was a foreign student, born and raised in a small village in Kenya. He grew up herding goats, went to school in a tin-roof shack. His father -- my grandfather -- was a cook, a domestic servant to the British.

But my grandfather had larger dreams for his son. Through hard work and perseverance my father got a scholarship to study in a magical place, America, that shone as a beacon of freedom and opportunity to so many who had come before.

While studying here, my father met my mother. She was born in a town on the other side of the world, in Kansas. Her father worked on oil rigs and farms through most of the Depression. The day after Pearl Harbor my grandfather signed up for duty; joined Patton’s army, marched across Europe. Back home, my grandmother raised a baby and went to work on a bomber assembly line. After the war, they studied on the G.I. Bill, bought a house through F.H.A., and later moved west all the way to Hawaii in search of opportunity.

They shared an abiding faith in the possibilities of this nation.

Joe Biden

My dad -- my dad, who fell on hard times, always told me, though, "Champ, when you get knocked down, get up. Get up." I was taught -- I was taught that by my dad. And, God, I wish my dad was here tonight.

And when I got -- when I got knocked down by guys bigger than me -- and this is the God's truth -- she sent me back out and said, "Bloody their nose so you can walk down the street the next day." And that's what I did.

You know -- and after the accident, she told me, she said, "Joey, God sends no cross that you cannot bear." And when I triumphed, my mother was quick to remind me it was because of others.

My mother's creed is the American creed: No one is better than you. Everyone is your equal, and everyone is equal to you.

My parents taught us to live our faith and to treasure our families. We learned the dignity of work, and we were told that anyone can make it if they just try hard enough. That was America's promise.

And for those of us who grew up in middle-class neighborhoods like Scranton and Wilmington, that was the American dream.

John McCain

When I was growing up, my father was often at sea, and the job of raising my brother, sister and me would fall to my mother alone. Roberta McCain gave us her love of life, her deep interest in the world, her strength, and her belief we are all meant to use our opportunities to make ourselves useful to our country. I wouldn’t be here tonight but for the strength of her character.

Sarah Palin

My Mom and Dad both worked at the elementary school in our small town.

And among the many things I owe them is one simple lesson: that this is America, and every woman can walk through every door of opportunity.

My parents are here tonight, and I am so proud to be the daughter of Chuck and Sally Heath. Long ago, a young farmer and habber-dasher from Missouri followed an unlikely path to the vice presidency.

I grew up with those people.

They are the ones who do some of the hardest work in America ... who grow our food, run our factories, and fight our wars.

They love their country, in good times and bad, and they're always proud of America. I had the privilege of living most of my life in a small town.

Based upon my experience, which I have in common with these candidates, I could have been a candidate also.

Dennis Barrett

I grew up in a small town in Idaho (Pocatello) with Parents with little means who scraped out a living for their family. My Father, a school teacher, coach and president of the Teachers Union, had struggled all his adult life to make the living including having to take extra jobs to support the family he loved. My Mother saved money at home by cutting our hair, sewing most of our clothes (something that at the time was a little embarrassing). When I was 12, my father, after experiencing a prolonged and worsening sense of heartburn, discovered that he had an advanced case of Pancreatic Cancer and had 3 months to live. After his death my Mother and I lived on Social Security benefits for survivors for a couple of years while she went back to school to become a Nurse. My family did not have the resources for me to go to college, but I never considered that I would not. I went to work and all through my college days, I worked to pay for my education. Without my Father I was not very informed. I probably could have qualified for financial aid, but never did take advantage of it. Even after getting married and having two children, I finished school working full time making cookies on the graveyard shift as a Keebler Elf and going to school full time. I then went to work in the Oil Industry as an Accountant, worked hard, and took advantage of every opportunity, including changing careers to business consulting management for an international software company.

There are thousands or millions like me in the US. There are numerous recent immigrants from places all over the world that have come to the US to seek opportunity and have succeeded even beyond what I have done, yet there are those that say the American Dream is dead, and one can not raise them selves up.

What I don't understand is how people who themselves have taken advantage of the opportunities and worked to raise themselves from nothing to a level of admired achievement can then turn around and say how broken the country is and that the Government must take care of us if we are to succeed. After exclaiming on one hand how this great country has provided them the opportunity to be who they have become, they then turn around and blame, cast dispersions on , and deride the same country and system that allowed them to be great. It is as if they think that the only reason they accomplished what they have is because they are something extraordinary rather than the country providing them extraordinary opportunities that are not available in most of the world.

The same programs and more, that these leaders used to pull themselves up along with the same hard work and personal responsibility that I and they applied still is in effect in the USA; if you are not told that you can't by someone who is supposed to know.

As a Patriarch

If you are a family member, you might have noticed, that I have not been updating my blog for a while.  It isn't that I have not had things I felt like expressing, it is that I did not want to come across as pushing my ideas on others.    I have spent a time in deep contemplation about my role as a Patriarch to my family.  While talking with two different people, it became apparent to me that I should share my experience and thoughts with my family to provide them context that they do not have.  I am going to do this to provide a more complete picture to aid them as they make their own decisions,.  I will  teach, and persuade as possible, and then let them make the decisions.   After all that is what our Father and Creator does. 

Admittedly some of my experience comes from the thousands of mistakes I have made, as well as from personal successes, and observed experiences of others.  Other knowledge comes from an education gained from both formal institutionalized coursework and a life of self study. I do believe I have learned much from being an observant person.

My intent for the next while is to write about a series of topics.   Since this is all serious, I will try and throw in something less serious blogs as well.

Today's Topic - Information and Historical Context

One of the things that really disturbs me about the world today, is that a great number of Americans, and others  look at life in the frame reference of today only.  What is happening today?  What am I able to get today?  What is most appealing today? Most of the younger generation has been raised on immediate gratification.  The rapid pace of life and a lack of interest has caused most people to be spoon fed their information in the form of  1 to 2 minute news segments that the media feeds us.  They form their opinions from Internet sound bytes, and 1 paragraph statements.  For many, if they read it or hear it from a supposedly reputable source, they believe it without questioning it's veracity or especially the entire context of the issue. As an example, it is true that 6.1% unemployment is bad, and that 6+% interest rates are higher than desirable.  But placing blame and pointing fingers without any understanding of the the context - why unemployment is high, or that interest rates of 6% for years were considered a good rate, is like immediately prosecuting the Father who is covered with blood  and holding his beaten child without learning that he just fought off an assailant.

This lack of being fully informed is contrary to the perspective with which our great country was established.  Our founding fathers established our democracy based on the principle that individuals will be stay well informed on the issues and take an active role in electing leaders and passing laws that serve them and preserve their freedom to choose. Without a well informed electorate, we put our freedoms, country, and opportunities at risk.

Upcoming Topics

With that in mind, over the next period I am going to provide some contextual insight into issues we all face.  Being in the middle of a political season, some of my initial insights will focus on issues that should be considered as we pick our leaders. As I see it the primary issues of our country today are:

1. A Land of Opportunity
2. The Economy -1
3. The Economy -2
4. Energy
5. National Security
6. Education
7. My Experience with an Election for "Change" in 1970
8. The Change We Need
9. Growth, Challenges, and Choices

While I admit that I have my own opinions and preferences, I want to talk about these issues from an logical perspective and will do so one by one, not necessarily in the above order.

What Does Barack Have to Hide?

His Citizenship

Berg vs. Obama Citizenship Challenge

Proof that his Birth Certificate is Fake 1

Proof that his Birth Certificate is Fake 2

Web site Tracking Berg vs. Obama Challenge on Citizenship