Responsibility #52

<body topmargin=0 leftmargin=0 marginheight=0 marginwidth=0> <table cellpadding=0 cellspacing=0 border=0><tr> <td valign="top" colspan=2 height=110 BGCOLOR="#666699" TEXT="#080000" bgproperties="fixed" background="04900840erlcjm.png"> <div> <FONT SIZE="5" COLOR="#FFFFFF" FACE="Arial" ><B>NATIONAL SECURITY--Structural,Moral,Economic,Domestic,International</B></FONT><B>     |     </B><A HREF="index.htm" TARGET="_top" TITLE="NATIONAL SECURITYStructural,Moral,Econom"><U><B>home</B></U></A></div> <div> <A HREF="id33.htm" TARGET="_top" TITLE="Responsibility Contents"><U>Responsibility Contents</U></A>   |   <A HREF="id34.htm" TARGET="_top" TITLE="Responsibility 1"><U>Responsibility #1</U></A>   |   <A HREF="id35.htm" TARGET="_top" TITLE="Responsibility 2"><U>Responsibility #2</U></A>   |   <A HREF="id36.htm" TARGET="_top" TITLE="Responsibility 3"><U>Responsibility #3</U></A>   |   <A HREF="id37.htm" TARGET="_top" TITLE="Responsibility 4"><U>Responsibility #4</U></A>   |   <A HREF="id38.htm" 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to President, et al,"><U>Health Care Letters to President, et al, 8/24/94</U></A>   |   <A HREF="id123.htm" TARGET="_top" TITLE="Arguments for Delay in Enactment of a He"><U>Arguments for Delay in Enactment of a Health Care Bill</U></A>   |   <A HREF="id124.htm" TARGET="_top" TITLE="Post WORLD WAR IIPost COLD WAR Deja Vu"><U>Post WORLD WAR II--Post COLD WAR Deja Vu</U></A>   |   <A HREF="id125.htm" TARGET="_top" TITLE="Responsibility 89"><U>Responsibility #89</U></A>   |   <A HREF="id126.htm" TARGET="_top" TITLE="Responsibility 90"><U>Responsibility #90</U></A>   |   <A HREF="id127.htm" TARGET="_top" TITLE="Responsibility 91"><U>Responsibility #91</U></A>   |   <A HREF="id128.htm" TARGET="_top" TITLE="Responsibility 92"><U>Responsibility #92</U></A>   |   <A HREF="id129.htm" TARGET="_top" TITLE="Responsibility 93"><U>Responsibility #93</U></A>   |   <A HREF="id130.htm" TARGET="_top" TITLE="Responsibility 94"><U>Responsibility #94</U></A>   |   <A HREF="id131.htm" TARGET="_top" TITLE="Responsibility 95"><U>Responsibility #95</U></A>   |   <A HREF="id132.htm" TARGET="_top" TITLE="Responsibility 96"><U>Responsibility #96</U></A>   |   <A HREF="id133.htm" TARGET="_top" TITLE="Responsibility 97"><U>Responsibility #97</U></A>   |   <A HREF="id134.htm" TARGET="_top" TITLE="Responsibility 98"><U>Responsibility #98</U></A>   |   <A HREF="id135.htm" TARGET="_top" TITLE="The Structure of Our Nation is Unsound"><U>The Structure of Our Nation is Unsound</U></A>   |   <A HREF="id136.htm" TARGET="_top" TITLE="Ltr. to Editor, 3/19/96, Property Taxes "><U>Ltr. to Editor, 3/19/96, Property Taxes and Education Funding</U></A></div> <div> </div> </td> </tr><tr> <td valign="top" width=190 BGCOLOR="#CCCCFF" TEXT="#080000" background="04311c00egdysm.png"> <bR> </td> <td valign="top" height=370 BGCOLOR="#FFFFFF" TEXT="#080000"> <div> Responsibility #52</div> <div> (written prior to July 1992)</div> <div> To the People of the United States of America:</div> <div>      In the last two papers, we developed seven <B><U>inviolable </U></B><B><U>principles to govern the generation of federal revenues and the expenditure of federal appropriations,</U></B> so as to control federal omnipotence, and maintain justice for all.  Six more principles will be developed to complete that endeavor.</div> <bR> <div> 8. <U>FOR INCOME TAX PURPOSES THERE WILL BE NO DEFERRAL OF CONSTRUCTIVELY RECEIVED INCOME</U>.</div> <div> We touched upon pension plans under principle 7. in the last paper.  The variety of pension plans that qualify for tax deferral under the law, and the time value of money, create great inequities among taxpayers, and hence gross violation of property rights.  </div> <div> Those taxpayers who have no pension plan, or a low defined contribution plan, pick up the tab for the taxes not collected on maximum benefit defined benefit plans.  In all cases taxes are not being paid on the yearly deductions, the yearly earnings on those past accumulated deductions, and the earnings on the accumulated past earnings.  Any financial planner, securities broker, banker, or insurance agent can show the reader an illustration of the huge difference in accumulated estate due to this tax deferment.  The inverse of that huge difference is the added tax bite picked up by other taxpayers, or worse, the added deficit and national debt to be paid by our children and grandchildren.</div> <div> Life insurance products are another example.  Some members of Congress have tried to get past the money and power of the insurance industry lobbies and PACS, to pass laws to reduce or eliminate the inequity of tax deferrals of earnings on cash values and annuity policies, without success.  Since these "investments" essentially have no amount limitations, they constitute an uncontrolled violation of property rights.</div> <div> 9. <U>FAVORITISM IN INTEREST RATES WILL NOT BE EXERTED IN THE MARKET PLACE</U>.</div> <div> Tax exempt and government guaranteed bonds, loans, and deposits, constitute an unfair bias in the market place, and a violation of property rights.  Other taxpayers have to come up with the taxes not collected on the interest paid on tax exempt securities. Other borrowers have to pay higher interest rates, or may be driven from the marketplace, due to the favoritism of guaranteed bonds and loans.  Taxpayers are already paying for the defaults, on the guaranteed deposits in banks and savings & loans, that may reach $500 billion.</div> <div>   </div> <div> 10<U>. THE FEDERAL GOVERNMENT WILL OPERATE ON A PAY AS YE RECEIVE BENEFITS BASIS</U>.</div> <div> This principle fundamentally places our revenues and appropriations on a balanced budget basis, but not necessarily year by year.  A number of examples will clarify.  </div> <div> The deficits during a world war may justifiably be paid off over a number of generations, since future as well as present generations benefit from the war results.  To pull the nation out of a depression, it would be just and probably necessary, to pay off the debt incurred over two or three business cycles. Although the reforms, called for in these Responsibility papers, are expected to improve considerably the stability of our nation (and the world), we cannot presume that we have eliminated periodic recessions.  Deficits, incurred to preclude or alleviate a recession, should be programmed to be repaid over the next business cycle, notwithstanding the projected slower growth rates.</div> <div> The deficit spending binges, the massive government guarantees, and the unforgivable lack of regulation and oversight, during the Reagan-Bush administrations, have been an abject violation of the property rights of present and future generations.  The deficits must be brought to a screeching halt.  The nation must begin to pay off the massive national debt, thereby relieving future generations of some of the burden that they must pay, for benefits expended before they were born.  The government must phase out the government guarantees, that threaten to burden present and future generations, with fiascos similar to the banks and S&Ls bailouts.  The President and the Congress must step arms length away from special interest groups, to install the requisite degrees of regulation and deregulation and oversight, to protect the general welfare.  </div> <div> 11. <U>THE FEDERAL GOVERNMENT WILL NOT ASSUME RISKS THAT ARE NOT IN FURTHERANCE OF THE GENERAL (VIS'A VIS' PARTICULAR) WELFARE</U>.   </div> <div> This principle is consistent with principles 1., 3., 7., 9., and 10. in this and the two previous essays.  Years ago the government backed loans to forestall failures of Lockheed, Chrysler, and one of the largest banks.  Despite the hundreds of billions already lost from taxpayers, the government has done little or nothing to reduce the guarantees to depositors in banks and S&Ls.  On top of that we have the $1 trillion actual or implied guarantees of <U>Government Sponsored Enterprises</U> whose loans are still ballooning.  All of these amount to actual or contingent transfers of property from other taxpayers, for the welfare of particular persons or entities.</div> <div> Our founding fathers saw fit to include in the Constitution a restraint on the power of Congress <I>"to raise and support armies"</I> by the clause <I>"but no appropriation of money to that use shall be </I><I>for a longer term than two years".</I>  How much more so do we need a restraint on Congress' power to commit the nation to future appropriations, to pay off a horrific national debt, and to stand behind an unpredictable degree of defaults on transactions guaranteed by the federal government!</div> <div>  </div> <div> 12. <U>THE FEDERAL GOVERNMENT WILL ESTABLISH AND MAINTAIN THE DEGREE OF REGULATION AND OVERSIGHT OF BUSINESSES AND INDUSTRIES NECESSARY TO, BUT NOT IN EXCESS OF, THAT REQUIRED TO PROMOTE AND PROTECT THE GENERAL WELFARE</U>. </div> <div> We need look no further than the on-going banks and S&Ls bailout fiasco, the real estate industry late 1980s collapse, and the current tailspins in the airline industry, to appreciate the urgency of adopting this principle.</div> <div> 13. <U>THE PRESIDENT AND THE CONGRESS WILL BE HELD RESPONSIBLE TO THE AMERICAN PEOPLE THAT ALL LEGISLATION, APPROPRIATIONS, CONTRACTS, AND GOVERNMENT ACTIONS ARE BASED ON THE GENERAL WELFARE AND ARE NOT POLITICALLY MOTIVATED</U>.  </div> <div> The reader is referred again to the "The King of Pork" article in the May 31, 1992 issue of Parade Magazine.  But the examples cited there are peanuts.  Thirty years ago the prime contractor contract award (worth billions of dollars) was awarded to a Texas aerospace company, over the objections of the Air Force and Navy Source Selection Board that a Washington state company was the best contender.  The Congress and the Executive branch fought for years after the signing of the contract.  The battles were based on many factors, but the rumors persisted that Texas received the nod because the then Vice President (who had been the most powerful man in Congress before becoming VP) was from Texas.  The perception is that these injustices are rife, through the power of the Presidency, and the leaders in Congress.  To have a united country means must be instituted to dispel these perceptions (actualities?).</div> <bR> <div>      Having developed these principles, we will get on with specific recommendations to get our country back "on the road again".</div> <div>                     Publius IV</div> <bR> <div> <A HREF="id86.htm" TARGET="_top" TITLE="Responsibility 53"><U>Responsibility #53</U></A></div> <div> Back to: <A HREF="id33.htm" TARGET="_top" TITLE="Responsibility Contents"><U>Responsibility Contents</U></A></div> </td> </tr></table></body>