From the online Merriam-Webster dictionary:
- a system in which the talented are chosen and moved ahead on the basis of their achievement
- leadership selected on the basis of intellectual criteria
According to the article linked below, many Americans are not working hard enough. They “don’t have six months of emergency savings in their bank accounts, and more than 50 percent do not have sufficient income to maintain their current living standards in retirement.”
The writer is perplexed that people aren’t saving more of their incomes. Her solution? Why, more government intervention into the economy, of course!
Supporting sustained private sector growth and the creation of American jobs – good jobs that meet basic standards of decent employment in pay, benefits, and worker protections – is one goal our lawmakers should take up as they start a new term. Pursuing this goal will benefit the working poor and the middle class alike.
We can make similar arguments about guaranteeing widespread access to affordable, quality education from early childhood through college for anyone who wants it and about creating new government-backed financial products that promote savings and thrift.
There is widespread belief that every American should have the opportunity to work hard at a job that supports a family, and that hard work should result in financial stability. Simply saying we believe that is not enough.
The writer jumps right to her conclusion (people aren’t saving, so we need government to force them to save) without asking a relevant question: why aren’t people saving for emergencies and retirement?
One reason why people aren’t saving is the fact that the federal government has failed in one of its basic duties, that of protecting its citizens from foreign invaders:
‘Dumping’ occurs when foreign firms produce goods and sell them at a price that is below their cost of production, and then export them to a foreign market. China and other countries have been subsidizing the production of goods for export for years. The effect of dumping is to drive competing firms out of business. One result is unemployment of workers when domestic firms shut down. It’s hard to save money when you don’t have a job.
The people who do have jobs can’t save money because of the high tax burden they face. The
legalized theft income taxes, sales taxes, and payroll taxes we all have to pay make it hard to save money. What percentage of his income does the average American pay in taxes? You might want to sit down for this: 54.4%
That’s right, the average American
pays loses over half of his income to taxes. That leaves 45.6% of his income for food, housing, transportation, recreation, etc. Note that if you are a drinker or a smoker, your tax burden is even higher due to the sin taxes imposed on those items.
Now add in the declining purchasing power of the dollar due to the actions of the Federal Reserve. Since 2008, the Fed has done three rounds of ‘Quantitative Easing’, which have increased the Fed balance sheet by over $2.4 trillion. This number only includes the first two rounds, QE1 and QE2, and not the QE3 that the Fed is doing now. Some economists argue that QE doesn’t lead to inflation. All I know is that the price of gasoline is up almost 100% since August of 2008 (from $1.75 to $3.35 per gallon), the price of food is up at least 33% in the same time period, and that the price of a small bag of Doritos has gone from $0.99 to $1.49 (and so had the price of
sugar water soda).
Why aren’t people saving money and/or moving up the financial ladder? In large part, it’s because the government has broken the rungs…