A bill of attainder (also known as an act or writ of attainder) is an act of the legislature declaring a person or group of persons guilty of some crime and punishing them without benefit of a trial. Bills of attainder are forbidden by Article I, section 9, clause 3 of the United States Constitution.
What does that mean? I means that congress is not to target any one group, nor can they punish any one group, without due process of law, i.e. taking them to court and having them go through a trial to reach a verdict for or against them. Therefore the 90% tax on bonuses is completely unconstitutional. They would have to tax every business in the country, including non-corporations. Yet, in the frenzy of the “get wallstreet” atmosphere, they have gone on the talk circuit to get countrywide support for their bill to tax wallstreet bonuses 90%.
It is a punishment, in its fullest, for the compensation of an agent / employee of the business. They literally are asserting themselves in the middle of the relationship of the employee and the company. Notice that the payroll tax is general and is carried out by both employee and employer, both sides pay the payroll tax, which most people don’t know. This would insert itself directly to wallstreet corporate agents to make them liable if they receive a bonus of some certain amount.
If they can do it here, that means the entire country is open to be taxed to death.
And, it seems they are headed that way. This year 2013, there is no 0% tax bracket for those making less than $10,000. That is dangerous territory. Who are the people making under $10,000 supporting? They can’t support themselves.
For all the activists for the “poor”, no one has spoken up about this. These activists normally support Obama. Now he has done something squarely against their agenda.
Will they react? Will they come out against him? Doubtful!
Certainly they are not going to go against taxing corporate wallstreet bonuses, which they should. And, they will not come out against taxing the poor.
A lot of people are being hoodwinked and led down a path that if fraught with danger and bad times ahead. I’m counting an extra $10 trillion introduced into the economy since 2007. [I’m counting both the very open bailouts and the under the table cash infusions by the federal reserve bank, which Ben Bernanke says he doesn’t have to disclose to congress] The problem is the politicians are talking about economics, a subject most adults in America know nothing about, and they sound logical and reasonable about.
” the problem is credit has stagnated and we wish to avoid credit from being unavailable to the general public. We need to get banks lending money, but they can’t since they have so many toxic assets on their books and if they lend more money they will be far more overleveraged and they refuse to do it. If we infuse the banks with cash and lower interest rates, then you the general public will continue to be able to purchase cars and homes and big screen t.v.s and our economy is based on consumer spending.”
If the economy indeed is based on consumer spending, then 1. freeing up credit markets will allow me to make purchases / loans at a reasonable level 2. lowering interest rates are in my best interest so I don’t have to pay for a house at a high interest rate 3. infusion of cash to banks allow them to lend me money.
The problem is, this entire premise, is completely false, a lie and evil. Why do i say evil? If they are trying to convince you that our economy is based on consumer spending, then they are then allowed, BY YOU, to do whatever they need to free up lending so that you can continue to consume, at all costs, including devaluing your money. Also, if that’s the case, then the value of your dollar NEVER matters. For idiots that don’t understand, if you buy the notion that our economy is based on consumer spending then, if you have $1,000 in the bank, they can inflate the economy so you have only $500 effective buying power, because all prices have risen.
This means that no work you do; no matter what improvements your boss makes; no discoveries in efficiency to lower production costs will have any impact on the economy because they can wipe all that ingenuity away by inflating the economy overnight. If you understood that sentence , then my explanation about the Austrian Business Cycle will be easy. Reread that sentence and understand it and we can move forward.
How does your salary increase? Most Keynesian economist would say “pay me more money“. It’s a very ignorant statement to make and I’ll explain why shortly. To this end Keynesian economist say, to increase the amount of money people have, we need to raise the minimum wage. [since they can’t control other wages directly] Keynesian economist think that if you increase minimum wages then the workers can buy more, since they make more. You sitting at home immediately probably already figured out if you raise the minimum wage, a lot of people are going to be fired, so that the ones left can be paid more, OR if they pay the workers more, they increase the prices. So raising the minimum wage completely is thwarted by raising prices. If everyone raises their prices, the minimum wage raise buys less and you have a zero sum gain.
How should wages be increased? I’ve already alluded to it right in the last paragraph but I’ll point it out blatantly. You don’t get paid more money, what happens is, we become better at what we do. What does that mean? You do your same job. You get paid the same salary. Your boss however, makes improvements to the company to make your job easier, so you spend less time doing more. The store owner buys in larger bulk and gets a larger price cut per item. He then, lowers the price of goods. People discover new innovations to make your job even more efficient, so you spend less time doing the same tasks. Therefore you can do more stuff in the same amount of time, because each task is now easier to do. Your boss can now lower prices because each item is cheaper to produce.
So far, the store owner lowered prices, your boss lowered prices, and production lowered prices. Check this out. You make the same amount of money you did yesterday, but ALL PRICES OF GOODS AND SERVICES HAVE BEEN LOWERED, so your salary can buy much more.
If the system is left alone, these innovations can occur all the time and prices can be lowered and lowered. A house would take far less to produce and should cost less today than it did 10 years ago. And, because all other goods and services were lowered, you would be able to purchase a much larger house today, than you could before.
Next, let’s visit credit, because I talked about it above. Let’s think about my perfect scenario, but with banks now. Because your salary can now go further, let’s assume you don’t feel a dieing need to spend every last dime you have. You go and open a savings account, so does your neighbor, your pastor and your cousin. After several years all of you have nice lump sums in the bank. The bank says,
“oh my we have quite a bit of money in the bank. you know what we can make lots of money if we lent to more people, let’s lower interest rates.” So the bank lowers interest rates. The store owner sees interest rates go down and thinks, people have more money to spend, and interest rates are lower, let me go take a loan and expand my business. So he does. One day you walk by and now your local store has groceries and a barbershop with an old fashion shave by razor. You then decide to stop by every week and get a nice shave and haircut while you shop. The store owner pays back his loan and the bank makes money. Because of all these shaves you and your cousin have been getting, your bank accounts have gone down by half. The bank raises interest rates and less people take out loans. And, life goes on.
Are you getting angry yet? Is the light coming on? Are you putting 2 and 2 together? Yes, let’s go back the Keynesian economists? They think the government has to oversea you, and your boss and the store owner. If the store owner says, “oh no I bought to much corn meal, I’m going to lose my shirt over this” they say no problem, we’ll infuse cash to you, so you don’t lose your shirt. They just stopped all the progress you, your boss, and production have been making, because prices are now inflated. In essence, they stole from you. They also lower interest rates artificially. Then the store owner is confused and thinks he should take out a loan and expand his business. However, you and your boss don’t make what you should be making due to the new inflation. You stop by the shop and shake your head when you see the new addition, because you don’t have the money for it. After about 6 months to a year, the store owner goes completely out of business because he can’t pay back that loan he took out because no one gets haircuts and shaves.
Which brings me to the Austrian Business Cycle.
“The theory views business cycles (which they also call credit cycles) as the inevitable consequence of inherently damaging and ineffective central bank policies, which cause interest rates to remain too low for too long, resulting in excessive credit creation, speculative economic bubbles and lowered savings. According to the theory, the business cycle unfolds in the following way. Low interest rates tend to stimulate borrowing from the banking system. This expansion of credit causes an expansion of the supply of money, through the money creation process in a fractional reserve banking system. This in turn leads to an unsustainable boom during which the artificially stimulated borrowing seeks out diminishing investment opportunities. This boom results in widespread malinvestments, causing capital resources to be misallocated into areas that would not attract investment if the money supply remained stable. A correction or “credit crunch” – commonly called a “recession” or “bust” – occurs when credit creation cannot be sustained. Then the money supply suddenly and sharply contracts when markets finally “clear”, causing resources to be reallocated back towards more efficient uses.The theory proposes that a sustained period of low interest rates and excessive credit creation results in a volatile and unstable imbalance between saving and investment.”
The boom comes from The Federal Reserve lowering interests rates [not because the banks have a lot of people who have large savings accounts] and business owners start a building frenzy or opening new businesses or whatever the latest fad is. The bubble is created because all these people are put to work, that didn’t work before. There’s all this money infused into something that wasn’t at the same volume before.
The burst comes from when you, YEAH YOU, don’t go out and buy these widgets from them. Why? Because you never said you wanted them in the first place. And, you never said you wanted them at twice the price. Did you?
So what’s the answer? First we need to do away with the entire federal reserve structure and dismantle all of their banks in America. We do not need a central bank dictating to everyone, including non-business people, such as yourself, by taking your savings away from you. We need to reduce regulation on businesses. It’s just taxes that takes away buying power from businesses. The only regulation we need from the government, is protecting your constitutional rights, and protecting you from being gouged economically. We need to go on a gold standard so this entire process can never occur again. On a gold standard you, your pastor, your neighbor and your boss all can rely on what a dollar is today and tomorrow. On a gold standard, if you put money in a savings account, the government can’t come steal it. On a gold standard, although your salary won’t increase, your dollar will increase due to the price of gold increasing. We were just on the gold standard all the way up until 1971 when Richard Nixon, by himself, took us off the gold standard. [wasn’t he a great guy?] On a gold standard a bank can gouge you either.