Almost all Income Inequality is caused by Government Taxes!


Social Inequality

QUESTION:

Dear Martin Armstrong,

I appreciate very much your economic analysis and read your blog nearly daily although I disagree with some of your political statements.

In your last blog about Schengen you mention that “Everything is connected and nothing takes place in some isolated vacuum”.  Obvious.

According to me, and many others re-known economists like Joseph Stiglizt or Paul Krugman, one of the problems in the current world is the exponential increase of social inequality and  massive collection of wealth in few hands.

How is it possible that barely the 60 richest people can have the same wealth as half of the population (3.6 billion)? Is this acceptable? What would be the solution in your opinion? Because just free markets will reinforce not decrease the actual trend and you seem to be “socialist”-averse although some sort of redistribution of wealth should be done, I suppose, but how?.

Thanks for your great work

BR

ANSWER: This is a Marxist diversion. It focuses only on the “rich” and ignores the fact that government continues to expand and consume wealth. The “wealth” that everyone points to for the richest people is by no means a product of WAGES, rather it is created on paper valuations of investment. At the same time, that “wealth” dropped $1 trillion just in the January decline this year. It is NOT actual “money” in that sense. It is no different than your home being worth $500,000 one day and then $200,000 a month later.

Total-Government-Expenditure-as-a-Percent-of-GDP-vs-Growth-Rate

“Social inequality” remains the headline grabber, yet the larger government becomes, the lower the economic growth. The OECD itself illustrates this. Higher taxes reduce economic growth, plain and simple. Then we have the average person who is robbed by about 50%+ between income taxes (federal and state), property taxes, fees, tools, and sales taxes. All of this goes to sustain government; it does NOT raise the living standard of the average person. Europe is even worse.

I tried to save Social Security on Capitol Hill. I argued to convert it to a wealth fund and allow it to invest exactly as the “rich” employ their money rather than stuffing it with depreciating government bonds. When I DONATED my time on Capitol Hill, the Dow was 1,000. That would now be 17 times more and amply enough to retired on. Social Security goes bust next year, and with interest rates manipulated lower you will get nothing.

Then the government charges payroll taxes on the average worker. Sure, they hand you a refund check at year-end. So they are borrowing from the average person and NOT paying them any interest. The government robs your ability to save and grow “rich” by stuffing your money in government bonds under Social Security.

Government creates “social inequality” by robbing the poor and middle classes while pretending to care. If we eliminated government federal income taxes, most people would take home at least 30% more.

Tax RobberyThe problem is NOT that the “rich” make money from investment; it is that the rest of society is DENIED the right to invest to get ahead because the government is bleeding everyone dry. Take all the money from the “rich” and we end up with communism, which will not improve your life in the least. So you do not stand a chance of surviving the future unless we start looking at the real culprit here. This is like a baseball game: the pitcher only focuses on the batter while those on base are stealing the next one unnoticed. We need to pay attention before there is no future for our posterity. Thank God I am not 18. I really do not want to live in a world run in this manner. This is not like Star Trek: “Scotty. Beam me up PLEASE!

THE DONALD’S FIRST DAY IN OFFICE


President Donald Trump and Vice President Marco Rubio are sworn into office.

ONE. In a rare event on inauguration day, Congress convenes for an emergency meeting to repeal the illegal and unconstitutional Socialist healthcare farce known as Obamacare. The new Director of Health and Social Services Dr. Ben Carson announces that an independent group of healthcare management professionals is hired to handle healthcare services for poor and low income people. They are also assigned the duty of eliminating Medicare and Medicaid fraud. Government’s costs for public healthcare are reduced by 90%. Healthcare insurance premiums for working Americans are reduced by 50%. The move saves billions of taxpayer paid dollars. Healthcare service in the U.S improves 100%.

TWO. Newly appointed Department of Homeland Security Chief Ted Cruz announces the immediate deployment of troops to the U.S. Mexico border to control illegal immigration and the immediate deportation of illegals with criminal records or links to terrorist groups. New bio-encrypted Social Security IDs are required by every American citizen. Birthright is abolished. All immigration from countries that represent a threat to the safety of American citizens is terminated indefinitely. The move saves American taxpayers billions of dollars. Several prisons are closed.

THREE. Newly appointed Secretary of Business and Economic Development Carly Fiorina eliminates more than half of the Government agencies operating under the Obama administration saving taxpayers billions of dollars. Stocks rise 100%.

FOUR. Newly appointed Director of Government Finance Rand Paul announces the abolition of the IRS and displays a copy of the new Federal Tax Return form. It consists of one page. The instructions consist of two pages. The Federal Reserve is audited. The move saves American Taxpayers billions of dollars and increases tax revenue.

FIVE. Hillary Clinton is in prison, where she belongs. Her cell is directly across from Jesse Jackson and Al Sharpton who are serving time for “Hate Crimes”. She bitches at them constantly from behind the bars of her cell in what some call cruel and unusual punishment.

SIX. Bernie Sanders is in the nuthouse, where he belongs. His room is directly across from Nancy Pelosi, Debbie Wasserman Schultz, Chris Matthews and Al Franken. They meet for tea every day at 10 AM and discuss the success and benefits of Communism and Socialism throughout the world. They also wonder when the “Mothership” is going to pick them up and return them to their home planets,

SEVEN. Windows 12 is released. It is designed for humans, doesn’t try to satisfy the needs of every person on the planet, doesn’t require a degree in nuclear physics to operate and looks just like Windows 7 except it is easier to use.

EIGHT. Barack Obama flees the United States under cover of darkness and returns to his homeland of Kenya before his trial for treason begins. He deplanes on a remote jungle airstrip. It was reported that he was last seen wandering through the jungle singing “Hakuna Matata” with a chimp named Commie.

NINE. A committee is not established to determine what is causing global cooling. Billions of taxpayer dollars are saved.

TEN. Dead people are no longer allowed to vote in Chicago, a huge blow for the Democrat Party in the State of Illinois.

THE PERFECT DAY!

 

Trump’s Reading of the Snake is Going Viral in Europe


The Snake is in with us right now be prepared!

Can Trump save the US?


POLITICS

Some people have asked if I am a Republican or Democrat/ Labour or Tory. Both political sides are wrong. They pander to their core constituents using the social issues to get everyone wound-up, but when it comes to economics; well there is no real difference. Neither side will reform or downsize government. Their solution will be as Christine Lagarde’s: grab more and more until it works for them.

1844 Phila Nativism Riot Againt Irish

1833MissBond

I have been asked if I really think Trump will be the man to save us. No. I do not believe anyone can do that at this late point in history. Trump’s reading of Al Wilson’s song “The Snake” is typical and part of the cycle. The state sovereign debt crisis of the mid-19th century was set in motion by Andrew Jackson’s war on the Bank of the United States because they funded his opponents. Jackson then destroyed the central bank, which set off the Age of Broken Banknotes. The Panic of 1837 became the Depression of the 1840s, and then states issued bonds to try to bailout their banks and then they defaulted. To this date, the Bank of England still has on its books bonds issued by States that they never paid on.

The economic pressures of that period produced the very same human response to immigration. Then it was the Irish. The movement against immigrants erupted into gun battles on the streets of Philadelphia in 1844 known as the Nativism Riots. These “native” Americans (white original immigrants) were against all immigrants as they felt they were taking their jobs. So Trump’s reading of “The Snake” is PRECISELY in line with history and is reflecting the very issue that is argued for the BREXIT by one side: STOP THE MIGRANTS.

The point is, quite frankly, that history repeats. We are in the midst of an economic decline. The standard of living is declining as government expands regardless of whom has been behind the uptrend since both sides have contributed to our demise as we approach our date with reality. Europeans hate Trump because they focus on some of his hardline statements and the fact that career politicians there see him as a very dangerous consequence because the same trend is emerging in Europe — oust the career politicians. But in the USA, the more Trump stands up against the career politicians, the louder his cheers. Meanwhile, the bankers are scared to death of both Trump and Bernie Sanders and see them as dangerous. Obviously, if they do not OWN the political candidate, he might actually prosecute them for crimes.

Euro Sinking

The Mayor of London, Boris Johnson, has come out in support of BREXIT. On the other side, you have British Prime Minister David Cameron making his pitch to remain within the European Union, claiming the UK could “have the best of both worlds” if it voted to remain in the bloc. We should expect the pound to decline as part of an official attack to convince people to stay in the EU. Then they will argue that the decline in the pound is proof that Britain should stay with a sinking ship.

So the point is this: Trump’s reading of “The Snake” is a sign of the times. He is tapping into the very same human response that ALWAYS unfolds during major economic declines. Merkel’s decision to open the floodgates for immigration occurred at EXACTLY the wrong time in the economic cycle. In a bull market, nobody would have noticed. Did it create the cycle? No. The downtrend was set in motion as our forecasts were laid out. Doing what she did was stupid and counter-trend so it was interpreted as a disaster.

War-Cycle-2014

Now, with hard times upon us, the Islamic immigrants will compete for jobs, take state assistance, and only cause the resentment to rise among those who see their living standards diminish. This is simply part of the War Cycle, which turned up in 2014 and nothing more. I have stated countless times that our correlation of all global trends demonstrates that war never comes when everyone is “fat and happy.” Turn down the economy and it all comes unraveled.

Trump’s reading of “The Snake” is feeding into the heat of the moment. It is perfect timing regardless of which side you are on for we just may be influenced by the entire cycle heading into the coming storm. So to me it is not abnormal; it is a sign that the cycle is indeed unfolding. I need not take sides. To me, this is indicative and confirmation of the trend in motion.

Can Trump prevent our demise? No. He probably does not realize the extent of the risk we face. People should by no means focus on Trump as an individual, for they will miss the entire trend. He is a symptom of the times and not the trendsetter himself. I have more faith in Trump insofar as he is NOT a career politician and that leaves a glimmer of hope that when he is wrong, he will change course. Career politicians will NEVER do that because they are incapable of admitting to mistake. That is simply what they are told in Politics 101.

stalincountthevote

Cameron wanting to stay in the EU when it is a total disaster is indicative of someone who puts politics before his own country. If Britain votes to leave, and they will probably rig that vote as they did the Scottish Vote to separate from the UK, Europe will see a contagion of massive proportions and the EU will collapse because they tried to make this a political United States of Europe rather than an economic union. My guess: Cameron and the EU will rig any BREXIT vote to ensure it remains with the sinking ship. If Britain leaves, the EU collapses.

A DETAILED LIST . . .


Hey that looks just like the list I made out … lol

Making America “Great” Again


Post by Paul Eidelberg

Donald Trump’s political leadership in the presidential race may be attributed to what Lou Harris calls “orneriness,” which he attributes to the American character in his book The Next American Civil War.

Harris foresees a revolution of the American middle class against the “Establishment,” or what men like Ted Cruz terms the “Washington Cartel.” This cartel is led by the intellectual elite, a product of American universities like Harvard, Yale, and Stanford.

Just as this elite scorned Trump in the New Hampshire primary, which he won because of the more decisive votes of the less educated, this political bias of academia may propel Trump to the White House. None of his rivals exhibit “orneriness.” They are more or less milquetoast politicians.

Although Trump lacks class, his orneriness endears him to the unwashed populists. This reminds me of Truman’s victory over New York Governor Thomas E. Dewey in the 1948 election.

Dewey appeared as a stuffed-shirt “establishment” man. Of course, unlike the egotistical Donald Trump, Truman was a plain or humble person from Independence Missouri, in contrast to the big-time New York attorney.

Also, today’s voters are more susceptible to showmanship, which Trump displays far more than his “nebbish” rivals – to use a Yiddish word for a milk-and-toast politician. Americans want to be entertained, especially today when America, under Obama, displays anything but manliness, let alone aggressiveness, vis-à-vis Islamic contempt for America.

Trump capitalizes on this Islamic arrogance, its insult to American greatness. Hence he doesn’t need to discuss issues, which, after all, are hardly discussed by his rivals.

And so, this 2016 presidential campaign is a “made-in-Hollywood” affair. Personality reigns supreme, larded with  democratic vulgarity.

The great 19th century French novelist, Gustav Flaubert, foresaw that this vulgarity would hold center stage in this era of triumphant democracy, which, he said, would make “any man of taste want to vomit”!

No one should be surprised, therefore, if Trump wins the presidency. How ironic! Democracy, or the rule of the many, of those who have to work for a living, elects a vulgar plutocrat to make America great again”!

Amid Growing Backlash Pope Francis and The Vatican Back Down Urgently – (W/ Viral EU Video)…


The Pope’s comments were totally out of line with a mam of the cloth of any religion — but this was “Totally” inappropriate for the catholic Pope. I glad I’m Russian Orthodox not a Catholic.

Whither Are We Going?


Post By Prof. Paul Eidelberg

Mankind is tottering on an abyss. Violence punctuates daily life in a world increasingly portrayed as meaningless. We are strangers, not only to each other but to ourselves. The “crisis of identity” has become a cliché. Familial and national ties have been eroded; we are homeless cosmopolitans. Indeed, no less than the President of the United States boasts of being a “cosmopolitan”! He emulates the Swedes, who replaced their heritage with multiculturalism.

Creación_de_Adán_(Miguel_Ángel)

Not knowing who or what we are, we lack the hauteur and confidence of cosmopolitans of the past. They believed in Universal Man, in man sub specie aeternitatis; we believe in nothing.  Our humanism is empty; we can’t even take our own humanity seriously. Nihilism has rendered the distinction between man and beast problematic. What, indeed, is noble about man that anyone should boast of being a “humanist”?

When man becomes problematic, enter civilizational decay, but also the possibility of renewal. Such was the case some twenty-four hundred years ago when Greek sophists like Protagoras exulted in teaching youth that “man is the measure of all things.” This unheard of and skeptical doctrine (the dogma of today’s universities), signifies that all ideas concerning the True, the Good, and the Beautiful are human creations, relative to time and place. Socrates saw that this secularism and relativism would eventually destroy the Olympian gods and was even then undermining public morality in Athens. The sophists, the Greek counterparts of today’s “value-free” social scientists, were broadcasting the death of Zeus, the pagan god of justice. Without Zeus, what would hold society together?  Without the traditional understanding of right and wrong, men would devour each other like animals.

Enter Socrates. His task, completed by Plato and Aristotle, was to substitute a restrained skepticism for the sophists’ unrestrained skepticism, lest men revert to beasts. The world-historical function of these Athenians was to construct a philosophy of man and a world view that would replace the no longer credible mythology of the Homeric cosmos. Accordingly, and as dramatized in The Republic (when the god-fearing Cephalus leaves the dialogue), philosophy replaces religion and the philosopher replaces Zeus. No longer are the gods to rule mankind, but reason – unaided human reason – would henceforth determine how man should live.

Of course, neither Plato nor Aristotle was so naive as to expect the generality of mankind to defer to the rule of philosophers. Apart from other considerations, philosophers are not only as quarrelsome as the offspring of Zeus and Hera, but, unlike the Olympians, they are mortal: here today, gone tomorrow. Something impersonal as well as immutable and eternal was therefore needed to command the obedience of man. What else could this be but Naturenature divested of Homeric deities. Neither the gods nor man but all-encompassing Nature was to be the measure of all things.  And this Nature, far from being arbitrary and mysterious, was fully accessible to the human mind.

The magnitude of Aristotle’s program has not been surpassed in the history of philosophy. He merely set out to comprehend the totality of existence, to reduce heaven and earth to an organized system of theoretical, practical, and productive sciences. To borrow the terminology of Rabbi J.B. Soloveitchik in Halakhic Man’ Aristotle would tolerate no randomness or particularity, no mystery to obscure the fleeting events of existence. Everything had to be fixed, clear, necessary, ordered. Nothing was beyond the grasp of the human mind because Nature, or the Cosmos, was an intelligent and therefore intelligible whole.

With Greek philosophy a new type of man appeared in the forefront of world history, Cognitive Man. Cognitive Man is a secularist who deifies the intellect. He must therefore be distinguished from his secular rivals, Volitional Man and Sensual Man. Whereas Cognitive Man seeks to understand the world, Volitional Man wishes to conquer and change it, while Sensual Man simply wants to enjoy it. Only with the ascendancy of Volitional Man, personified by Machiavelli, did secularism come into its own as the regnant force of history.

Of course, Machiavelli had collaborators: Hobbes, the father of modern psychology: “The thoughts are to the desires as scouts and spies to range abroad and find the way to the things desired”; Hume: “Reason is, and ought only to be the slave of the passions.” The influence of these two harbingers of Sensual Man explains why we are not used to thinking of Platonic-Aristotelian philosophy as secular.

Plato and Aristotle pay nothing more than lip service to the divine. True, the refinement of their writings conveys great piety. What gives the lie to this impression is that neither philosopher regarded piety as a virtue. We must also bear in mind their caution and civic-mindedness. Socrates, the master of irony, was given the hemlock for atheism. And what with the widespread corruption in Athens resulting from affluence, a disastrous war, and the unabashed atheism of so many intellectuals, it would have been reckless for these aristocrats of the mind to have joined the scoffers of a religion which, whatever its shortcomings, did provide some salutary restraints on the passions of men.

There are refined and vulgar forms of secularism. Plato and Aristotle’s is couched in pious language not only for political and pedagogical reasons, but because, in their species of humanism, the philosopher is virtually divine. By no means is the philosopher to be confused with the academic professor of philosophy. No one has portrayed the difference more powerfully than Nietzsche in Beyond Good and Evil (Part VI, “We Scholars).” For these giants of the intellect, Cognitive Man is the passionate lover of wisdom, where wisdom is nothing less than knowledge of the organizing principles of the universe.

But what is most distinctive of Cognitive Man, whether philosopher or scientist, is his attempt to reduce the fleeting phenomena of existence to lawfulness. This is as true of Platonic-Aristotelian philosophy as it is of Galilean-Newtonian physics, despite their very different conceptions of lawfulness. Both schools seek to discover the riddle of existence in some scientific order or pattern of the world. This is the aim of Cognitive Man.

However refined the quest of Cognitive Man, what unites him with his secular counterparts, Volitional and Sensual Man, is that, like them, he does not pursue the object of his desire to glorify God.  The reason is quite simple: for Cognitive Man such a God does not exist. Aristotle, like Spinoza, is a “pantheist.” His Prime Mover is an extrapolation from the principle of motion (Physics 251b17-25, 266a5).  As for Plato, his Demiurge is not a creator but an artificer that imposes order on a preexisting chaos (Timaeus 30a, 52d-55, 69b). One thing is clear: both philosophers rejected the idea of a personal God. Otherwise piety would be a virtue.

To be sure, the human psyche is not so easily compartmentalized. Cognitive Man may shade into Volitional Man. Thus Aristotle taught Alexander the Great political science; and politics. However, for Aristotle politics is but the application of philosophy to action. Let us see how Aristotle deals with this issue.

When Aristotle inherited the concept of nature from his teacher Plato, that concept had already been demythologized and transformed into the impersonal and immutable standard of how man should live. Aristotle enriched and systematized the idea by developing an organic and teleological theory of nature. Such was the success of this theory that it had no serious rivals in abodes of learning until the seventeenth century.  Vestiges of organicism may be found even in Kepler. However, not until the mechanistic theory of nature fathered by Galileo and Newton was organic concept of nature laid to rest.

What made the organic (and teleological) theory of nature so alluring and enduring is that it appealed to common sense.  Observe the growth of a tree from its seed and it will seem that the processes of nature are inwardly directed toward an end or telos. The end is that toward which a living thing strives in order to reach its completion. So it is with man.  Neither force imposed from without, nor chance, so much as an immanent impulse prompts man to form associations that can fulfill his potentialities. The most self-sufficient and comprehensive association is the political community, the polis, which alone can complete or perfect man’s nature. Whatever contributes to that end is called “good.” Nature is thus the standard for judging what is good (or bad); there is no other.

Could there be a more impersonal yet intimate and benign substitute for the Olympian gods?  Must we not marvel at Aristotle’s genius?  By creating a new foundation for morality, Aristotle became one of the greatest “legislators” of mankind.

This organic and teleological conception of man and nature was shattered by Galileo and Newton, the founders of modern science. Their mechanistic conception of nature left nature devoid any moral compass. Neither the quantum theory of Plank nor Einstein’s general theory of relativity provides a scintilla of light on how man should live.

When Nietzsche announced that “God is dead,” he was also announcing, wittingly or otherwise, the death of man. Modern man had become “human-all-too-human.” Thus was born Nietzsche’s desperate idea of the ubermensch. He asked “whither are we going?” and we are living today without an answer. This will compel us to return to Israel.

Monopoly Goes Cashless — The Coming New World Totalitarian Order


Monopoly-Cashless

Well, Monopoly is going cashless. It looks like the game company sees the writing on the wall and are preparing the kids for the new world order — a cashless society.

Is The Pending Euro Collapse on Target From Our 2011 Forecast of March 13/14 2016?


Draghai Euro Crisis

The euro crisis appears to be unfolding right on target rather amazingly. Our target was published in “The Rise and Fall of the Euro” back in 2011. The target for the collapse in confidence was 2016.202. This comes into play March 13/14, 2016. It is rather amazing that we can target a specific event within time, years in advance, and watch these things unfold. This illustrates that TIME remains everything and humanity repeats a process that results in the same response over and over again throughout history. This also demonstrates that our forecasting is not based upon OPINION. With the euro unable to reach 116 of a rebound, this does not look very good in the next few weeks.

Here is what we published in that report:

27th

 

From a timing perspective, the Bretton Woods System actually began with the operational start of the IMF on March 1, 1947 (1947.164). The euro began officially on January 1, 1999 (1999.002). The birth of the euro essentially completed the 51.6-year cycle between 1947 and 1999. The collapse of the euro appears to be due no later than 17.2 years from its birth, making the ideal target 2016.202, just 23.5 weeks ideally AFTER the peak on this current Economic Confidence Model wave 2015.75.