Is There a Shadow Government In America?

Who's Behind The Shadow Government?

Who's Behind The Shadow Government?

After reading several of my favorite sites out there, I’m beginning to wonder whether there is a shadow government running America.  The “Cash for Clunkers” program will cost the US tax payer $3 billion to graciously put 700,000 people who drive beaters into cars costing 5-6X more.  Yay, there’s a one time boost to August US auto sales due to hundreds of thousands of people who can’t afford new cars (according to the 1/10th rule)!

Over at DINKS Finance, I’m reminded that the income limit for Roth IRA contribution for single people is $105,000.  So they’re telling us after saving a party-throwing $6,000 bucks, the moment you make over $105,000 you can no longer contribute?  Too bad for you 29 year old grad students out of business school with a median income of $105,000.  Oh yeah, and all you doctors who spent 8+ years of your life AFTER college and those bagillion hours studying, so sorry!  The government isn’t willing to help you save for retirement.  No soup for you!

Do Higher Taxes Lead To Socialism In America?

Someone once said, “nothing is certain except pressing the reply all button by mistake and taxes.” How true the saying as we face rising taxes under the new administration.  Supposedly 32% of Americans filers pay ZERO TAXES!  I doubt this statistic sits well with the other 68% of files who pay taxes.   I also doubt the percentage of non-tax payers could be that high, but either way, even 15% is a lot.  The good thing for high income earnings is that the highest marginal tax rate has come down by almost half  since the 70’s.  Furthermore, generally if you are paying no taxes, your adjusted gross income is less than $8,350 as a single, or $16,700 as a married couple.   Wouldn’t you rather make more money and pay taxes than make little money and pay nothing?

Given we don’t blog for a living, and several readers asked me this afternoon “whether I think higher taxes lead to Socialism in America, Yes or No only”, my answer and thesis is therefore: “Yes, higher taxes do lead to socialism in America.”