Thursday, March 11, 2010
Extend and Pretend in Action - California Dreamin'
Governments don't want to tighten their belts like the private sector. They want to raise taxes and thus maintain the ability to keep their power, pay and benefits strong. The parasites are getting desperate and are preparing to squeeze too much blood out of their hosts. This will prolong our current economic depression and is a repeat out of the old cyclical play book. If you still have a private sector job, you are rich and should be punished severely.
The level of childish belief suspension is enormous in government. I live in California and they have a new tax trick for 2010 designed to hide how insolvent the state is. This is not a secret, but it is a low down, dirty shame. The state of California, already having one of the highest tax rates in the country, now wants their citizens to accelerate their estimated tax payments.
In other words, for those who owe quarterly taxes, it is no longer 25% of estimated taxes each quarter. No, the "new, improved" system requires 30% of annual estimated taxes in the 1st quarter and 40% in the second quarter. In other words, 70% of annual taxes are due in the first half of the year (the third quarter asks for 0% and 4th quarter for the last 30%).
This is "extend and pretend." This is a California dreamin' scam to make their balance sheet look better than it is so that some unsuspecting fools will loan the sunshine state more money. If you insist on hunkering down with government debt, BUY FEDERAL DEBT AS THEY CAN AT LEAST PRINT THE MONEY TO PAY THE INTEREST!
America, as the world's new deadbeat, has got "extend and pretend" down to a science it seems. Ignore the problems, keep borrowing more, and keep on spending no matter what. Because we all know that the economy is about to start booming again any second. And we all know that real estate tax revenues are about to skyrocket because home prices are about to shoot thru the roof and make new all-time highs. And we all know that consumers are about to go on mad spending sprees with money and credit they don't have and can't get any more. And we all know that China and Japan are just going to keep lending us an unlimited amount of money because we're America, gosh darnit!
The debt problem in California is magnitudes worse than Greece and Dubai combined. Once the big boyz decide it's time to go after Cali debt, watch the mainstream shills forget all about the problems with the Euro as the Dollar plunges fast and hard. The games will continue and currency volatility is set to accelerate.
The people have learned to model their behavior after their government in America. This is why I would wager that MILLIONS of Americans have either already or are about to initiate their own debt jubilee. Whether it's the mortgage, the credit card, the boat, or all the above - people have begun to just completely ignore their debt obligations. It works for the government and the big banks, so why not for everyone else?
The moral hazard will only increase as our out-of-control fascist government tightens the screws on the private sector while refusing to tighten their own belts. I say starve the foul beast. You think I care if mail is only delivered 3 days a week? You think I care if we get rid of the Department of Homeland Security, the Department of Energy, the Department of Education, the CIA, the Department of Motor Vehicles in every state, the Bureau of Alcohol Tobacco and Firearms, the Internal Revenue Service, our hundreds of military bases in other countries, the Federal Communications Commission, the Drug Enforcement Administration, the Food and Drug Administration, the Department of Agriculture, etc., etc.?
And for investors, we damn sure don't need the Securities and Exchange Commission or Commodities Futures Trading Commission, since they just protect the Wall Street fraud and keep it going at a feverish pitch. Raise taxes and debase the currency. When in doubt, do it again. What about decreasing the size of the government?! What about cutting government pay and benefits?!
I think I'm going to start sending in customized IOUs to the state of California instead of federal reserve notes for taxes, since that's what California is going to be using to pay tax refunds. Might as well cut out the middle man - who needs the federal reserve debt tickets when we can all just issue our own personal IOU debt tickets backed by nothing? Eye for an eye is fine with me. My credit score is higher than the state of California's, so they'd be getting the better end of the deal anyway...