Economics from a people first point-of-view

Public Choice Theory

Public Choice Theory  was the brainchild, born in the mid-20th century by two professors, James Buchanan and Gordon Tullock.  These two men were libertarians whose goal in the name of “freedom” was to diminish the  American government to a skeleton level and wipe out its bureacracy in favor of the private sector economy.

Tullock and Buchanan curried favor with wealthy conservative American donors who helped them hold lavish seminars in Florida during summers. The seminars were free for judges and law students. Here Tullock taught judges his theories of economics and politics.

In this century, Tullock’s  dream of converting judges in Florida has reached fruition in the current Supreme Court and the federal courts that we are now seeing.

The Public Choice Approach

Public choice is also called preference voting. Tullock proselytized public choice voting. His words spread among American universities and even over to the pond to a Russian college. Under the moniker of Ranked-Choice voting was recently used in Maine elections.

Gordon Tullock, like Steve Bannon in our century, realized that public choice voting was a way that political minority groups could gain power over majorities. Continue reading →

The ignorant way that politicians talk about money these days is not only irritating, but it’s also dangerous.

Many seem to think that money is an object. They are wrong. Money is a concept, not just a thing. Money has shown its face in numerous different guises throughout the milennia of time on earth that is known to us.

Some money is tangible to our human senses. But in this century of  the “financialization” of all things, money is becoming more and more intangible. and even hidden from us. Money is now bits of data in computers—computers that are networked with other computers on and off of the World Wide Web.

Here is why I strongy object to the view of a member of Congress saying on TV that “Government money is ‘Confederate money'”. Money may be hidden in places where it isn’t transparent to others, but the chief essential thing that makes money be real money is trust!

Money is only valuable where more than one person has trust in it.

If  there is no trust in money it becomes an object, a thing that is treated by every other object that is bought and sold in any kind of market—or hoarded. Confederate money is indeed an object. It cannont be circulated for use when buying other kinds of goods or services. But U.S. government money has won trust all over the planet.

Financialization

Continue reading →

The Rich and The Not-Rich

In my previous post on “Earned” vs. “Unearned Income”, I  concluded that the IRS keeps Americans at the bottom and the middle of the income scale from achieving their “American Dreams” by use of “limits” on contributions, and “carry over deductions” .

As proof,  I’m going to show about two examples of IRS tax credits for charitable giving that serve to keep the Not-Wealthy down.

Then I’ll reveal how the wealthy avoid paying taxes on their unearned incomes. Because, in actuality, today there are only two social classes left in the U.S. – The Rich and The Not-Rich.

The Not-Rich are workers: the Rich are investors and inheritors.

I will show that workers, including self-employed professionals and small busines owners, earn lower incomes, while being taxed at significantly higher tax rates on their earnings than investors.

Why? Because the IRS limits the amounts that workers can use their”earned” or “unearned income” to obtain tax credits (i.e., deductions from gross income) on their taxes.

Meanwhile, IRS tax shelters on “unearned income” (i.e,. investments and inhertiances) by the rich are making them even richer.

Ways The IRS Holds the Not-Wealthy Down

The IRS allows those who make “earned income” only very small portion of the the huge amounts of untaxed income granted to wealthier taxpayers who make “unearned income” from their inheritances and investments.

The IRS calls tax loopholes for the not-wealthy “Deductions” or “Credits”.  “Earned income” ensures that workers will rarely be able to progress up the ladder to become wealthy after they are taxed. Here’s why:

Read some of the instructions in IRS manuals or on its web site. You’ll see the word “LIMITS”.

Like traffic signs they’ll blare at you! You’ll also see the phrase “CARRY OVER” combined with this word “LIMITS“.

I first became aware of limits on tax credits for middle class earned-income workers when I got a 20 percent homeowners’ credit for my first-time mortgage on a condo.

Every tax year there would be a limit on how much money I could claim credits for. Every year I had to carry over money until the next tax year. Over ten years of payments, I never even got close to getting 20 percent deductions on my taxes! Continue reading →