So yet again everyone in Washington DC wants to raise taxes on your children and grandchildren to spend money today. We might be going into a recession because the bubble of financing real estate led to people spending money they couldn’t pay back. So now home construction is decreasing, banks are having trouble meeting within capitalization requirement without huge inflows of capital from abroad, excess housing supply…
The government has been spending huge amounts of money it doesn’t have for a long time. So what great ideas do our leaders have: put more burden on the children and grandchildren to pay for our spending today. What a sad state of affairs. And almost no-one seems to question this behavior.
Is the idea that we would go into a recession so remote these leaders never imagined it could happen? No, of course they new it would happen. So what should a country, company, individual do if they know they have some expected event in the future they might want to spend money on? This isn’t really tricky. I would guess many 8 years olds understand the concept. You put the money in the piggy bank for when you will want to spend it.
If you decide to spend not only all the money you have but borrow huge amounts that will tax your future earnings to pay back your current spending that is your choice (as long as you can find someone to lend you money). But as many parents have told their kids you have to live with the decisions you make. You don’t get to spend your money today. Spend tomorrows money today. Spend your kids money today. And then when, tomorrow comes, just spend all that money all over again. How can a country allow leaders to so transparently tax the future of the country?
It is a sad state of affairs. The country chooses not to sent aside funds for obvious future needs. Then instead of accepting the hole they have dug for themselves decides to tax their children even more to continue the spendthrift ways. I think we not only need to have politicians actually read the bills before they vote (they refuse to pass such a law) they need to read about the ant and the grasshopper.
I have no problem with the country choosing to set aside funds to use when they want to try and stave off a recessions (to pay for tax cuts or more spending). I do have a problem with: running enormous deficits every year, raising taxes on our children and grandchildren year after year, and then deciding to raise taxes even more on the future when the obvious happens and perfectly predictable desired expenditures present themselves. The get another credit card school of financial management (that everyone in Washington DC seems to practice) is not workable for a country over the long term. As anyone that has used that strategy personally will tell you – it works for awhile but eventually there are serious consequences.
The leaders in Washington just keep taxing our children and grandchildren to pay for their spending – and we let them. That seems to be their only economic policy – tax the future, spend more money today, don’t pay for what we spend now. If the Congress and President raise the deficit (either by spending more money or cutting taxes) all they are doing is taxing the future. If they want to cut taxes the only way to do that, honestly is to cut taxes and cut spending.
If politicians claim to cut taxes but in fact pass on huge debts to the future they just moved the taxes into the future. In my opinion those raising future taxes are worse than those that raise taxes today (but obviously most people disagree with me). Most of the time this delayed taxing strategy will result in very big increases in total taxes as the “miracle of compound interest” works against us instead of for us.
I really wish we would stop allowing them to do that.
Related: USA Federal Debt Now $516,348 Per Household – Politicians Taxing Future to Pay Special Interests – USA Comptroller General: USA Living Beyond Means – More Washington DC Waste – Charge It to My Kids – USA National Debt Clock: $9,192,263,597,400 increasing $1.4 billion per day since September, 2006