In a recent “Other Voices” article, Jim Firth, chairperson of the Nevada County Democrats, asks: “How about us ordinary folks? When will those of us living on a fixed income or still waiting for the pay raise that does more than stay even with inflation see our living standard improve?”
If you are expecting the United States Federal Reserve banking system to come to your rescue, don’t hold your breath. Did you know that Ben Bernanke went on record saying that it is the Federal Reserve’s policy to increase inflation by 2 to 3 percent every year because that is good for the economy and helps the government to reduce its debt?
Inflation is good? We need to reduce the value of our dollars?
In Bernanke’s mind it’s good because the government gets to pay off its debt with cheaper dollars.
He reminds me of FDR’s advisor, Harry L. Hopkins, who wrote “Spending to Save!”
Firth also tells us that: “The economic recovery is slow (although wealthy stockholders are seeing their wealth soar).” Another good point! But why is that? Since the stock market deals in risk management, what is driving the stock market higher? Cheap money! The Federal Reserve keeps printing money, calling it quantitative easing, and rich stockholders, both Republicans and Democrats, get richer. Did you know that the bankers, who sold the idea of a Federal Reserve system to Congress, did so by offering them a deal that they couldn’t refuse?
In the Federal Reserve Act, Sec. 7, Division of Earnings, “… the stockholders (bankers) shall be entitled to receive an annual dividend of six per centum” and, “all net earnings shall be paid to the United States as a franchise tax …” That’s 6 percent for the bankers and 94 percent for the politicians.
Great! The politicians get more money, and we have gotten 2 to 3 percent inflation per year for the last 100 years! All brought to you courtesy of President Woodrow Wilson, a progressive Democrat!
Firth also asks: “What can we do to change the stagnation in the political sinkhole known as Washington D.C.?” His answer is to elect more Democrats, because he believes Democrats will fix all of the problems our country faces. One example he gives is to increase the federal minimum wage, which he says “needs to be raised.”
Like so many of Jim Firth’s “progressive” ideas, minimum wage laws are hurtful, not helpful, in the long run. Read economist Thomas Sowell’s book, “Basic Economics.” There you will find in Chapter 10 – “Controlled Labor Markets Under Minimum Wage Laws” — that in countries where minimum wages increase, unemployment also increases, and that in countries where minimum wages are low or nonexistent, unemployment is very low. Minimum wage laws produce unemployment. That is a fact! This is particularly true for young and inexperienced workers. Would you pay someone $10 an hour for labor that is worth less than $5 an hour?
When you mandate a raise in the minimum wage, you drive up all wages and increase the taxes collected by our government, which adds even more cost to American-made goods.
Firth would have you believe that those who oppose the mislabeled Affordable Care Act do so because of “… bigotry and fear …”
No! We oppose it because we believe that it is economically unsound.
In his “Applied Economics” book, Thomas Sowell writes: “Government-run social insurance programs seldom have enough assets to cover their liabilities, but rely instead on making current payments out of current receipts. These are called pay-as-you go programs — and sometimes they are also called pyramid schemes.”
The ACA is just another Ponzi (pyramid) scheme, where the young and healthy pay for the old and sick. That would probably work except for one unfortunate fact: Statistics show that the number of old people is increasing while the number of young people is decreasing.
So, how will the next generation of young folks be able to pay the health costs of the current generation of young people when they get old?
If you believe, as I believe, that the tax-and-spend attitude of both Democrats and Republicans has pushed us into the economic morass in which we find ourselves today — vote. But when you vote, vote for fiscal conservatives who will help move our economy back onto the path that leads to prosperity.
Jim Driver lives in Rough and Ready.