Domas Jefferson

Does it seem to you like there has been an unusual amount of seismic activity around the world lately?  Well, it isn't just your imagination.  The Ring of Fire is roaring to life and that is really bad news for the west coast of the United States.  Approximately 90 percent of all earthquakes and approximately 75 percent of all volcanic eruptions occur along the Ring of Fire.  Considering the fact that the entire west coast of the United States lies along the Ring of Fire, we should be very concerned that the Ring of Fire is becoming more active.  On Wednesday, the most powerful strike-slip earthquake ever recorded happened along the Ring of Fire.  If that earthquake had happened in a major U.S. city along the west coast, the city would have been entirely destroyed.  Scientists tell us that there is nearly a 100% certainty that the "Big One" will hit California at some point.  In recent years we have seen Japan, Chile, Indonesia and New Zealand all get hit by historic earthquakes.  It is inevitable that there will be earthquakes of historic importance on the west coast of the United States as well.  So far we have been very fortunate, but that good fortune will not last indefinitely.

In a previous article, I showed that earthquakes are becoming more frequent around the globe.  In 2001, there were 137 earthquakes of magnitude 6.0 or greater and in 2011 there were 205.  The charts and data that I presented in that previous article show a clear upward trend in large global earthquakes over the past decade, and that is why what happened this week is so alarming.

On Wednesday, a magnitude 8.6 earthquake struck off the coast of Indonesia and that was rapidly followed by a magnitude 8.2 earthquake off the coast of Indonesia.  Fortunately those gigantic earthquakes did not produce a devastating tsunami, but that doesn't mean that those earthquakes were not immensely powerful.

Normally we only see about one earthquake of magnitude 8.0 or greater per year.  The magnitude 8.6 earthquake was the most powerful strike-slip earthquake in recorded history.  If that earthquake had happened in the United States, it would have probably been the worst natural disaster in U.S. history.  The following is from an article posted on The Extinction Protocol....

I’ve never heard of a strike-slip lateral earthquake of this great a magnitude; especially under water. Preliminary assessment of the Indonesian quakes by U.S. geologists suggests one plate lurched past each other as much as 70 feet. San Andreas is a strike-slip, lateral- can we even imagine two sections of ground moving 70 feet near San Francisco? Had the force of the Sumatra quakes been unleashed upon San Andreas, the city would have been completely destroyed.

And earthquake activity along the west coast has definitely been heating up in recent days.

On Wednesday, a magnitude 5.9 earthquake struck approximately 160 miles off of the coast of Oregon.

Early on Thursday, there were two major earthquakes (magnitude 6.9 and magnitude 6.2) in the Gulf of California.

It is only a matter of time before the "Big One" hits California.

Sadly, most Americans (especially young Americans) can't even tell you what the Ring of Fire is.  The following is how Wikipedia defines the "Ring of Fire"....

The Pacific Ring of Fire (or sometimes just the Ring of Fire) is an area where large numbers of earthquakes and volcanic eruptions occur in the basin of the Pacific Ocean. In a 40,000 km (25,000 mi) horseshoe shape, it is associated with a nearly continuous series of oceanic trenches, volcanic arcs, and volcanic belts and/or plate movements.

The entire west coast of the United States falls along the Ring of Fire and a massive network of faults runs underneath California, Oregon and Washington.

At this point, scientists tell us that the west coast is long overdue for a major earthquake.  An article in Time Magazine a few years ago stated the following....

California has more than 300 faults running beneath its surface, including the massive San Andreas Fault, yet the quake to end all quakes has yet to occur. In 1980, a federal report declared the likelihood of a major earthquake striking California within the next 30 years to be "well in excess of 50%."

Unfortunately, the truth is that is a very, very conservative estimate.  The west coast has always been extremely unstable and it always will be.  At some point there is going to be a tragedy of unimaginable proportions on the west coast.

Just hope that you are not there when it happens.

But it isn't just California, Oregon and Washington that should be concerned.

According to the Arizona Geological Survey, there were 131 earthquakes in the state of Arizona in 2011.  That was a huge increase from just 53 in 2010.

And of course an absolutely nightmarish earthquake could occur along the New Madrid fault at any time, but that is a topic for another article.

As far as the Ring of Fire is concerned, another major threat is volcanic activity.

One of these days, one or more of the major volcanoes on the west coast is going to experience a major eruption again.  There have been signs that Mt. Rainier has been becoming more active, and a major eruption of Mt. Rainier could potentially be absolutely devastating for much of the northwest United States.

Of even greater concern along the Ring of Fire is Mt. Fuji.  As I wrote about the other day, Mt. Fuji has been dormant for about 300 years but is now rapidly roaring to life.  New craters have appeared and these new craters are venting gas.  There has been a swarm of earthquakes under Mt. Fuji this year, including a magnitude 6.4 earthquake on March 15th.

If Mt. Fuji were to experience a full-blown eruption, the consequences could be absolutely catastrophic.  Mt. Fuji is not too far from Tokyo - one of the most densely populated cities on the entire planet.  The loss of life resulting from a full-blown eruption of Mt. Fuji would be almost unimaginable.

But it is not just along the Ring of Fire that we are seeing a rise in volcanic activity.  The truth is that we are seeing a rise in volcanic activity all over the globe.  The following are just a couple of recent examples which have been in the news....

*The volcanoes in Iceland that caused such huge problems a few years ago are becoming very active once again.

*Authorities in Colombia have declared a "red alert" and believe that an eruption of the Nevado del Ruiz volcano is imminent.

*Ash is venting at the world famous Anak Krakatau volcano in Indonesia.

Something really strange is going on.

Most scientists will deny it or will attempt to downplay it until they are blue in the face, but the truth is that the trembling of our planet is getting worse.

If this shaking continues to get worse, there are going to be some absolutely horrific tragedies in the years ahead.

So do you have a theory for why there is so much seismic activity happening along the Ring of Fire?  Please feel free to post a comment with your thoughts below....

The Federal Reserve says that everything is going to be okay.  The Fed says that unemployment is going to go down, inflation is going to remain low and economic growth is going to steadily increase.  Do you believe them this time?  As you will see later in this article, Federal Reserve Chairman Ben Bernanke has been dead wrong about the economy over and over again.  But the mainstream media and many Americans still seem to have a lot of faith in the Federal Reserve.  It doesn't seem to matter that Bernanke and other Fed officials have been telling the American people lies for years.  As I always say, most people believe what they want to believe, and many people seem to want to have blind faith in the Federal Reserve even when logic and reason would dictate otherwise.  The truth is that things are not going to be getting much better than they are right now.  When the next wave of the financial crisis hits, the U.S. economy is going to fall back into recession, financial markets are going to crash and unemployment is going to absolutely skyrocket.  But you will never hear any of that from the Federal Reserve.

The following are 5 new lies that the Federal Reserve is telling the American people.  After each lie I have posted what The Economic Collapse Blog thinks is actually going to happen....

#1 The Federal Reserve says that the labor market has improved and that unemployment is going to decline significantly over the next few years.

The following is a quote from the FOMC press release that was released on Wednesday....

Labor market conditions have improved in recent months; the unemployment rate has declined but remains elevated.

The Federal Reserve is projecting that the unemployment rate will fall within the range of 7.8 percent and 8.0 percent by the end of 2012.

The Federal Reserve is also projecting that the unemployment rate will fall within the range of 6.7 percent and 7.4 percent by the end of 2014.

The Economic Collapse Blog says that the labor market has not improved.  In March 2010, 58.5 percent of all working age Americans had a job.  Exactly two years later in March 2012, 58.5 percent of all working age Americans had a job.  If the labor market was improving, the percentage of working age Americans with a job should have gone up.

The Economic Collapse Blog also says that while there is a chance the official unemployment rate may go down slightly in the short-term, the truth is that it is going to go up into double digits once the next wave of the financial crisis hits us.

#2 The Federal Reserve says that that U.S. economy is going to experience solid GDP growth over the next couple of years.

In fact, the Federal Reserve is projecting that U.S. GDP will be rising at an annual rate that falls between 3.1 percent and 3.6 percent by the end of 2014.

The Economic Collapse Blog says that a great economic cataclysm is coming....

"When the European banking system crashes (and it will) it is going to reverberate around the globe.  The epicenter of the next great financial crisis is going to be in Europe, and it is getting closer with each passing day."

#3 The Federal Reserve says that we can expect low inflation for an extended period of time.

The Federal Reserve is officially projecting that the annual rate of inflation will not be higher than 2.0 percent by the end of 2012.  Federal Reserve Chairman Ben Bernanke reinforced this projection during his press conference on Wednesday....

“But we expect that to pass through the system, and assuming no new shocks in the oil sector, inflation ought to moderate to about 2 percent later this year.”

The Economic Collapse Blog says that the Fed is being tremendously dishonest and that if inflation was measured the exact same way that it was measured back in 1980, the annual rate of inflation would be more than 10 percent right now.

The truth is that most middle class families know that we do not have low inflation right now.  This is hammered home millions of times a day when average Americans visit the gas station or the grocery store.

At the beginning of the next recession inflation will likely subside, but that will only be because economic activity will be slowing down dramatically.

#4 The Federal Reserve says that it has built up a 30 year reputation for keeping inflation low.

Ben Bernanke actually had the gall to make the following claim during his press conference on Wednesday....

"We, the Federal Reserve, have spent 30 years building up credibility for low and stable inflation, which has proved extremely valuable in that we’ve been able to take strong accommodative actions in the last four, five years to support the economy."

Oh really?

The Economic Collapse Blog says that the Federal Reserve has nearly a 100 year reputation for destroying the value of the U.S. dollar.  Even using the Fed's doctored numbers, the value of the U.S. dollar has declined by more than 95 percent since 1913.

To get a really good idea of just how much the dollar has been destroyed by the Fed over the years, just check out this chart.

#5 Federal Reserve Chairman Ben Bernanke says that we should trust him because the Federal Reserve stands ready to do whatever is necessary to support the U.S. economy.

"If appropriate... we remain entirely prepared to take additional action"

The Economic Collapse Blog says that Federal Reserve Chairman Ben Bernanke is doing a great disservice by not warning the American people about the tremendous crisis that is coming.  In a recent article I stated that this next crisis will blindside most Americans just like the last one did....

"Sadly, just like back in 2008, most people will never even see this next crisis coming."

So who should you trust - the Federal Reserve or all of the half-crazed bloggers out there that are warning about the "serious doom" that is coming.

Well, come back to this article in a year or two and compare how accurate the predictions were.

In the end, time will tell who is telling lies and who is not.

If we do not learn from history, we are doomed to repeat it.

For example, let's take a quick look at Ben Bernanke's track record over the past several years.

The following are statements that Bernanke actually made to the public....

#1 (July, 2005) "We’ve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s gonna drive the economy too far from its full employment path, though."

#2 (October 20, 2005) "House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals."

#3 (November 15, 2005) "With respect to their safety, derivatives, for the most part, are traded among very sophisticated financial institutions and individuals who have considerable incentive to understand them and to use them properly."

#4 (February 15, 2006) "Housing markets are cooling a bit. Our expectation is that the decline in activity or the slowing in activity will be moderate, that house prices will probably continue to rise."

#5 (February 15, 2007) "Despite the ongoing adjustments in the housing sector, overall economic prospects for households remain good. Household finances appear generally solid, and delinquency rates on most types of consumer loans and residential mortgages remain low."

#6 (March 28, 2007) "At this juncture, however, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained. In particular, mortgages to prime borrowers and fixed-rate mortgages to all classes of borrowers continue to perform well, with low rates of delinquency."

#7 (May 17, 2007) "All that said, given the fundamental factors in place that should support the demand for housing, we believe the effect of the troubles in the subprime sector on the broader housing market will likely be limited, and we do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.  The vast majority of mortgages, including even subprime mortgages, continue to perform well.  Past gains in house prices have left most homeowners with significant amounts of home equity, and growth in jobs and incomes should help keep the financial obligations of most households manageable."

#8 (January 10, 2008) "The Federal Reserve is not currently forecasting a recession."

#9 (June 10, 2008) "The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so."

But don't worry, Ben Bernanke insists that he knows exactly what is going on this time.

So do you believe him?

A lot of Americans don't.  In fact, an "economic collapse" is the number one catastrophic event that Americans worry about according to one recent survey.

Perhaps that is one reason why so many Americans are preparing for doomsday these days.

The central planners over at the Federal Reserve are not going to solve our economic problems.

The truth is that the Fed is at the very heart of our economic problems.

We have been living in the greatest debt bubble in the history of the world and that debt bubble has been facilitated by the Fed.

Over the past three decades, the total amount of debt in America has increased by about 50 trillion dollars.  By stealing from future generations, we have been able to live like kings and queens, but there is going to be a great price to pay for our foolishness.

Ben Bernanke and the other folks running the Federal Reserve are just going to keep insisting that everything is going to be okay for as long as they possibly can.  They are going to tell you that they know exactly how to fix things and that the economy will be back on track very soon.

Don't be stupid and believe them this time.

Most Americans have no idea how much economic trouble is heading our way.  Most of them just assume that everything will eventually "return to normal" just like it always has before and that those running our economy "know what they are doing" and that we should trust them to do their jobs.  Unfortunately, these beliefs are being reinforced by the bubble of false hope that we are experiencing right now.  For example, it is being reported that weekly unemployment claims in the United States have fallen to a four-year low.  That is a very good thing.  Let us hope that unemployment claims go even lower and that the current period of stability lasts for as long as possible.  We should enjoy these last fleeing moments of tremendous prosperity for as long as we can, because when they are gone they won't be coming back.  As I noted the other day, all of this false prosperity in the United States has been financed by the 15 trillion dollar party that we have been enjoying.  We are adding about 150 million dollars to our debt every single hour so that we can continue to enjoy an inflated standard of living.  Unfortunately, nobody in the history of the world has ever been able to keep a debt spiral going indefinitely, and our debt bubble will burst eventually as well.

Sadly, when you attempt to end (or even slow down) a debt spiral the consequences can be extremely painful.  Just look at what is happening in Greece.  Several waves of austerity measures have been implemented, the Greek economy has been plunged into a full-blown depression and Greek debt is still going up.

The rest of the nations of the eurozone are also now implementing austerity measures, and most of them are also starting to fall into recession.  The economic pain in Europe is just beginning and it will go on for quite a long time.

And eventually the United States is going to join the pain.  Right now the U.S. government can still borrow trillions of dollars at super low interest rates thanks to games being played by the Federal Reserve.  But it is simply not possible for this Ponzi scheme to last too much longer.  When it ends, the pain will be extremely great.

And even in the short-term there are some extremely troubling signs for the U.S. economy.

The following are 19 signs of very serious economic trouble on the horizon....

#1 According to one new survey, approximately one-third of all Americans are not paying their bills on time at this point.

#2 The U.S. housing industry is bracing for another huge wave of foreclosures in 2012.  The following is from a recent Reuters article....

"We are right back where we were two years ago. I would put money on 2012 being a bigger year for foreclosures than 2010," said Mark Seifert, executive director of Empowering & Strengthening Ohio's People (ESOP), a counseling group with 10 offices in Ohio.

#3 The Citigroup Economic Surprise Index, a key indicator watched by many economists, is on the verge of heading into negative territory.

#4 We are supposed to be in the middle of an economic recovery in the United States, but bad news just keeps pouring in from major companies.  For example, Yahoo is firing thousands of workers and Best Buy is closing dozens of stores.

#5 Richard Russell says that the "big money" is starting to quietly exit from the financial markets....

"My guess is that this is the big money that has been holding off as long as it decently can -- and then dumping their goods just before the close. I don't think the big money likes this market, and I think they have been slowly exiting this market, as quietly as they can."

#6 Goldman Sachs is projecting that the S&P 500 will fall by about 11 percent by the end of 2012.

#7 All over the country, local governments are going into default and we have not even entered the next recession yet.

#8 The U.S. government will add more to the national debt in 2012 than it did from the time that George Washington became president to the time that Ronald Reagan became president.

#9 The Federal Reserve is desperately trying to control interest rates.  The Fed purchased approximately 61 percent of all government debt issued by the U.S. Treasury Department in 2011.  This is the only thing that is keeping interest rates in the United States from soaring dramatically.

#10 German industrial production is falling at a pace that is far faster then expected.

#11 Italy's debt-to-GDP ratio is now up to 120 percent.

#12 The Spanish government admitted on Tuesday that Spain's debt-to-GDP ratio will rise by more than 11 percent this year alone.

#13 Yields on Spanish bonds are rising to dangerous levels.

#14 The Spanish government is projecting that the unemployment rate in Spain will exceed 24 percent by the end of the year.

#15 Unemployment in the eurozone as a whole has risen for 10 months in a row and is now at a 15 year high.

#16 In the aftermath of a 77-year-old retiree killing himself in front of the Greek parliament in protest over pension cuts, the economic rioting in Greece has flared back up dramatically.

#17 At this point, Greece is experiencing an economic depression with no end in sight.  Some of the statistics coming out of Greece are really hard to believe.  For example, one port town in Greece now has an unemployment rate of approximately 60 percent.

#18 The IMF is asking the United States to contribute more money for European bailouts.

#19 At this point, even some of our top scientists are projecting economic trouble.  For example, researchers at MIT are projecting a "global economic collapse" by the year 2030 if current trends continue.

But the truth is that we will experience a "global economic collapse" long before 2030 comes rolling around.

Let us hope that we still have at least several more months of economic prosperity in the United States before things really fall apart.

The truth is that the vast majority of Americans need more time to prepare for what is coming.

Sadly, most Americans are not preparing.  Most Americans have blind faith that those in positions of power are going to fix everything and set us on the path to even greater prosperity than ever before.

Unfortunately, all Federal Reserve Chairman Ben Bernanke and Barack Obama have been doing is kicking the can down the road and making our eventual collapse much worse.

As many of us have painfully learned, you can run from debt for a while, but you can't hide from it forever.  Eventually debt catches up with you, and when it does it can be very cruel.

The 15 trillion dollar party is coming to an end, and the consequences of decades of very foolish decisions are going to fall on this generation.

The U.S. tax code is a complete and utter abomination and it needs to be thrown out entirely.  Nobody in their right mind would ever read the whole thing - it is over 3 million words long.  Each year, Americans spend billions of hours and hundreds of billions of dollars trying to comply with federal tax requirements.  Sadly, it is the honest, hard working Americans in the middle class that always get hit the hardest.  The tax code is absolutely riddled with loopholes that big corporations and the ultra-wealthy use to minimize their tax burdens as much as possible.  Many poor people do not pay any income taxes at all.  The dishonest are rewarded for cheating on their taxes (if they can get away with it) and the ultra-wealthy have moved trillions of dollars to offshore tax havens where they can avoid U.S. taxation altogether.  Our system is incredibly unfair to the millions of hard working people in the middle class and upper middle class that drag themselves out of bed and go to work each day and try to do the right thing.  In addition, the current U.S. tax system is incredibly inefficient, it diverts a tremendous amount of resources away from more valuable economic activities, and it has chased thousands of businesses and trillions of dollars out of the United States.  The U.S. tax code is such a complete and utter mess at this point that it can never be "fixed".  The only rational thing to do is to abolish it completely, and any politician that tells you otherwise is lying to you.

The following are 24 outrageous facts about taxes in the United States that will blow your mind....

1 - The U.S. tax code is now 3.8 million words long.  If you took all of William Shakespeare's works and collected them together, the entire collection would only be about 900,000 words long.

2 - According to the National Taxpayers Union, U.S. taxpayers spend more than 7.6 billion hours complying with federal tax requirements.  Imagine what our society would look like if all that time was spent on more economically profitable activities.

3 - 75 years ago, the instructions for Form 1040 were two pages long.  Today, they are 189 pages long.

4 - There have been 4,428 changes to the tax code over the last decade.  It is incredibly costly to change tax software, tax manuals and tax instruction booklets for all of those changes.

5 - According to the National Taxpayers Union, the IRS currently has 1,999 different publications, forms, and instruction sheets that you can download from the IRS website.

6 - Our tax system has become so complicated that it is almost impossible to file your taxes correctly.  For example, back in 1998 Money Magazine had 46 different tax professionals complete a tax return for a hypothetical household.  All 46 of them came up with a different result.

7 - In 2009, PC World had five of the most popular tax preparation software websites prepare a tax return for a hypothetical household.  All five of them came up with a different result.

8 - The IRS spends $2.45 for every $100 that it collects in taxes.

9 - According to The Tax Foundation, the average American has to work until April 17th just to pay federal, state, and local taxes.  Back in 1900, "Tax Freedom Day" came on January 22nd.

10 - When the U.S. government first implemented a personal income tax back in 1913, the vast majority of the population paid a rate of just 1 percent, and the highest marginal tax rate was just 7 percent.

11 - Residents of New Jersey pay $1.64 in taxes for every $1.00 of federal spending that they get back.

12 - The United States is the only nation on the planet that tries to tax citizens on what they earn in foreign countries.

13 - According to Forbes, the 400 highest earning Americans pay an average federal income tax rate of just 18 percent.

14 - Warren Buffett had an effective tax rate of just 17.4 percent for 2010.

15 - The top 20 percent of all income earners in the United States pay approximately 86 percent of all federal income taxes.

16 - Sadly, as Bill Whittle has shown, you could take every single penny that every American earns above $250,000 and it would only fund about 38 percent of the federal budget.

17 - The United States has the highest corporate tax rate in the world (35 percent).  In Ireland, the corporate tax rate is only 12.5 percent.  This is causing thousands of corporations to move operations out of the United States and into other countries.

18 - Some tax havens are doing a booming business in setting up sham headquarters for U.S. corporations.  For example, the city of Zug, Switzerland only has a population of 26,000 people but it is the headquarters for 30,000 companies.

19 - In 1950, corporate taxes accounted for about 30 percent of all federal revenue.  In 2012, corporate taxes will account for less than 7 percent of all federal revenue.

20 - In a previous article, I discussed how many of our largest corporations make huge profits and yet pay less than nothing in taxes....

What U.S. corporations are able to get away with is absolutely amazing.

The following figures come directly out of a report by Citizens for Tax Justice.  These are combined figures for the tax years 2008, 2009 and 2010.

During those three years, all of the corporations below made a lot of money.  Yet all of them paid net taxes that were below zero for those three years combined.

How is that possible?  Well, it turns out that instead of paying in taxes to the federal government, they were actually getting money back.

So for these corporations, their rate of taxation was actually below zero.

If you have not seen these before, you are going to have a hard time believing some of these statistics.....

*Honeywell*

Profits: $4.9 billion

Taxes: -$34 million

*Fed Ex*

Profits: $3 billion

Taxes: -$23 million

*Wells Fargo*

Profits: $49.37 billion

Taxes: -$681 million

*Boeing*

Profits: $9.7 billion

Taxes: -$178 million

*Verizon*

Profits: $32.5 billion

Taxes: -$951 million

*Dupont*

Profits: $2.1 billion

Taxes -$72 million

*American Electric Power*

Profits: $5.89 billion

Taxes -$545 million

*General Electric*

Profits: $7.7 billion

Taxes: -$4.7 billion

Are you starting to get the picture?

21 - Exxon-Mobil paid $15 billion in taxes in 2009, but not a single penny went to the U.S. government.

22 - Many wealthy Americans hide enormous amounts of money outside the country in order to avoid paying taxes.  According to the IMF, a total of 18 trillion dollars is currently being hidden in offshore banks.

23 - The number of traffic accidents spikes each year right around April 15th.  The following is from a recent Bloomberg article....

Deaths from traffic accidents around April 15, traditionally the last day to file individual income taxes in the U.S., rose 6 percent on average on each of the last 30 years of tax filing days compared with a day during the week prior and a week later, according to research published in the Journal of the American Medical Association.

24 - Most of the tax debate is focused on income taxes, but the truth is that Americans pay dozens of other taxes every single year.  The following are just a few of the taxes that many Americans pay....

#1 Building Permit Taxes

#2 Capital Gains Taxes

#3 Cigarette Taxes

#4 Court Fines (indirect taxes)

#5 Dog License Taxes

#6 Federal Unemployment Taxes

#7 Fishing License Taxes

#8 Food License Taxes

#9 Gasoline Taxes

#10 Gift Taxes

#11 Hunting License Taxes

#12 Inheritance Taxes

#13 Inventory Taxes

#14 IRS Interest Charges (tax on top of tax)

#15 IRS Penalties (tax on top of tax)

#16 Liquor Taxes

#17 Luxury Taxes

#18 Marriage License Taxes

#19 Medicare Taxes

#20 Property Taxes

#21 Recreational Vehicle Taxes

#22 Toll Booth Taxes

#23 Sales Taxes

#24 Self-Employment Taxes

#25 School Taxes

#26 Septic Permit Taxes

#27 Service Charge Taxes

#28 Social Security Taxes

#29 State Unemployment Taxes (SUTA)

#30 Telephone Federal Excise Taxes

#31 Telephone Federal Universal Service Fee Taxes

#32 Telephone Minimum Usage Surcharge Taxes

#33 Telephone State And Local Taxes

#34 Tire Taxes

#35 Toll Bridge Taxes

#36 Toll Tunnel Taxes

#37 Traffic Fines (indirect taxation)

#38 Utility Taxes

#39 Vehicle License Registration Taxes

#40 Vehicle Sales Taxes

#41 Workers Compensation Taxes

When you account for all forms of taxation on the federal, state and local levels there are many Americans that pay out more than half of their incomes in taxes.

We are being taxed into oblivion, and yet most Americans do not even realize that it is happening.

It is kind of like being killed by thousands of tiny cuts.

So what do all of these taxes buy us?

They buy us a massively bloated government that wastes money on some of the craziest things imaginable.

Millions of Americans work for the federal government, and yet most of them produce very little of real economic value.  The following comes from a recent National Review article....

By 2005, the federal government employed 14.6 million people: 1.9 million civil servants, 770,000 postal workers, 1.44 million uniformed service personnel, 7.6 million contractors, and 2.9 million grantees. This amounted to a ratio of five and a half “shadow” government employees for every civil servant on the federal payroll. Since 1999, the government had grown by over 4.5 million employees.

According to that same article, when you add in state and local government workers the numbers are even more dramatic....

According to the U.S. Census Bureau, there are 3.8 million full-time and 1.5 million part-time employees on state payrolls. Local governments add a further 11 million full-time and 3.2 million part-time personnel. This means that state and local governments combined employ 19.5 million Americans.

Yes, we do need some government.  For example, without any law enforcement at all our society would descend into complete chaos, and without any military at all we would be completely open to foreign conquest.

In order to have a stable, secure society we do need some government.

However, we definitely do not need the massively bloated government that we have today.

The truth is that most government employees are a drain on the system.  Most of them just push paper around.  I used to work in Washington D.C. so I know what pushing paper around is all about.

And as I wrote about yesterday, there are millions of other Americans that enjoy a comfortable existence at the expense of the federal government without doing any work whatsoever.

Of course the biggest welfare recipients of all are the big corporations.  All forms of corporate welfare should be eliminated immediately.

When are U.S. taxpayers going to get sick and tired of paying for all of this?

Every single year, the federal government, state governments and local governments drain massive amounts of desperately needed money from hard working middle class families.

Then they take that money and spend it on incredibly foolish things.

When are American voters going to stand up and boldly declare that they have been taxed enough already and they aren't going to take it anymore?

The current tax code is completely and utterly broken and it is beyond repair.

Unfortunately, neither the Republicans or the Democrats are proposing that we should get rid of it.

So we are just going to continue to get more of the same year after year, and it is the middle class that will feel the pain.

Which lifestyle choice produces better results - being a hard working American or being a government parasite?  Actually, when you look at the cold, hard numbers they may just surprise you.  In America today, we deeply penalize hard work and we greatly reward government dependence.  If you live in a very liberal area of the country and you know how to game the system, it is entirely possible to live a comfortable existence without ever working too much at all.  In fact, there are some Americans that have been living off of "government benefits" for decades.  Many of these people actually plan their lives around doing exactly what they need to do to qualify for as many benefits as possible.  America is rapidly turning into a European-style socialist welfare state and it is destroying our nation socially and financially.  Ever since the "war on poverty" began our debt has absolutely exploded and yet now there are more poor people in this country than ever before.  Obviously something is not working.

Now don't get me wrong.  I deeply believe in having compassion for those that are going through tough times and having a safety net for those that cannot take care of themselves.  We should not have a single person in this nation going without food or sleeping in the streets.

But in America today it is absolutely ridiculous how many people are climbing aboard the "safety net".  At this point, an astounding 49 percent of all Americans live in a home that receives some form of government benefits.

So who pays for all of this?

The people that drag themselves out of bed and go to work each day pay for it all.

For a few moments, let's examine how the lifestyle of a typical hard working American compares to the lifestyle of a government parasite.

In America today, the median yearly household income is somewhere around $50,000.  About half of all American households make more than that and about half of all American households make less than that.  When you break it down, it comes to about $4000 a month.

So how far does $4000 go in America today?

Unfortunately, it doesn't go very far at all.

First of all, a hard working American family will need some place to live.  Unfortunately, the vast majority of the decent jobs are near the big cities, and it is more expensive to live near the big cities.  Let's assume that an average family of four will spend about $1000 a month on rent or on a mortgage payment.

The government parasite, on the other hand, has a whole host of federal, state and local housing programs to take advantage of.  During the recent economic downturn, more Americans than ever have been turning to the government for help with housing costs.  For example, federal housing assistance outlays increased by a whopping 42 percent between 2006 and 2010.

Once you have a place to live, you have to provide power and heat for it.  For the average hard working American, this is going to probably average about $300 a month, although this can vary greatly depending on where you live.

For the government parasite, there are once again a whole host of government programs to help with this.  For example, LIHEAP (Low Income Home Energy Assistance Program) assists low income households in paying their home heating bills.

Most average hard working Americans are also going to need phone and Internet service.  Let's assume that the hard working family of four in our example is extremely thrifty and only spends $100 a month for these services.

For the government parasite, cell phone service is not a problem.  As I have written about previously, those that "qualify" can receive a free cell phone and free cell phone minutes every single month from the federal government.  In addition, in some areas of the nation low income families can qualify for deeply subsidized home Internet service.

In order to earn money, our hard working family is going to need to get to work.  In most households, both parents have decided to work these days so both of them will need cars.  Let's assume that the family is very thrifty and that both cars were purchased used and that the car payments only total about $400 a month.

The hard working family will also need auto insurance for the two vehicles.  Let's assume that both parents have a great driving record and that they only pay a total of about $100 a month for car insurance.

The cars will also need to be filled up with gasoline.  The average U. S. household spent $4155 on gasoline during 2011, but let's assume that our family is very, very careful and that they only spend about $300 on gas each month.

So what about the government parasite?  Well, the government parasite does not need to go to work, so this expense can potentially be eliminated entirely.  But since most other things are paid for by the government or are deeply subsidized, in many instances government parasites are actually able to afford very nice vehicles.

In addition, a new bill (The Low-Income Gasoline Assistance Program Act) has been introduced in Congress that would give "qualifying" households money to help pay for gasoline....

Low-Income Gasoline Assistance Program Act - Directs the Secretary of Health and Human Services to make grants to states to establish emergency assistance programs to pay eligible households for the purchase of gasoline.

A hard working American family is also going to need health insurance.  Well, we all know how expensive health insurance has become.  In fact, health insurance costs have risen by 23 percent since Barack Obama became president.  But let's assume that our hard working family has somehow been able to find an amazing deal where they only pay $500 a month for health insurance for a family of four.

For the government parasite, health insurance is not needed.  If there is an emergency, the government parasite can just go get free medical care at any emergency room.

And of course there is always Medicaid.  Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, one out of every 6 Americans is on Medicaid, and things are about to get a whole lot worse.  It is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.

So what about food?

Everyone has to eat, right?

Well, the hard working family in our example is faced with an environment where food prices are constantly rising but paychecks are not keeping up.  Let's assume that the hard working family in our example clips coupons and cuts corners any way that it can and only spends about $50 for each member of the family on food and supplies each week.  That comes to a total of $800 a month for the entire family.

So what about the government parasite?

Government parasites need to eat too.

Well, that is where food stamps come in.  Right now, there are more than 46 million Americans on food stamps.  Since Barack Obama became president, the number of Americans on food stamps has increased by 14 million.  Food stamps have become so popular that rappers are even making rap videos about using food stamp cards.

Okay, so after all of this where do we stand?

Well, the average hard working family so far has spent $3500 out of the $4000 that they have to spend for the month.

We still need to find money for clothing, for paying off credit card debt, for paying off student loan debt, for dining out, for entertainment, for medications, for pets, for hobbies, for life insurance, for vacations, for car repairs and maintenance, for child care, for gifts and for retirement savings.

But wait.

There is actually no money left at all because we have forgotten one of the biggest expenses of all.

Taxes.

When you total up all federal, state and property taxes, our average hard working family is going to pay at least $1000 a month in taxes.

So that puts our average hard working family in the hole every single month.

Meanwhile, the government parasite does not pay any taxes because he or she does not earn enough money to be taxed.

Are you starting to get the picture?

In many ways, life can be so much easier when you are constantly taking from the government instead of constantly giving to the government.

New Jersey Governor Chris Christie recently put it this way....

"We'll have a bunch of people sitting on a couch waiting for their next government check"

Once again, I am not dumping on those that have been through all kinds of nightmares because of this economy.  As I have written about so frequently, the U.S. economy is simply not producing enough jobs for everyone anymore, and this is creating major problems.

Just about everyone needs a helping hand at some point, and we should always be compassionate to those that are in need.

However, there is also a growing number of Americans that are content to simply give up and live off of the government, and that is fundamentally wrong.

It is not the job of the U.S. government to take care of you from the cradle to the grave.  What the U.S. government is supposed to do is to make sure that we have a well functioning economy that operates in an environment where hard working individuals and small businesses can thrive, and sadly the U.S. government has failed miserably in that regard.

We desperately need the U.S. economy to be fixed, but I wouldn't hold my breath waiting for that to happen.

As economic conditions get even worse in this country, millions more Americans are going to turn to the government for assistance and at some point the safety net is going to break.

What is our country going to look like when that happens?

The mainstream media is not telling you the truth about unemployment in the United States.  The percentage of working age Americans that are employed is not increasing.  In March 2010, 58.5 percent of all working age Americans had a job.  In March 2012, 58.5 percent of all working age Americans had a job.  So if the employment rate is exactly the same as it was two years ago, then how in the world can the Obama administration claim that things have gotten significantly better since then?  According to the Bureau of Labor Statistics, the official unemployment rate in the United States was 9.8 percent in March 2010 and it declined to 8.2 percent in March 2012.  So how is this possible if the percentage of working age Americans that have jobs hasn't moved?  Well, what they do is they claim that there are millions upon millions of Americans that have "left the labor force".  In other words, they claim that there are millions upon millions of unemployed Americans that don't want jobs anymore.  Of course that is a total farce, but the mainstream media and most Americans are buying it.  They actually believe that the unemployment rate is going down.  But the truth is that the unemployment crisis in America has not subsided.  In fact, we are pretty much exactly where we were two years ago, and things are about to get a whole lot worse.

If you want to know the shocking truth about unemployment in America, all you need to do is to look at one chart.  The chart posted below shows the change in the employment-population ratio over the past few years.  What the employment-population ratio measures is the percentage of working age Americans that actually have jobs.  As you can see, it fell dramatically during 2008 and 2009, and since then it has been hovering between 58 and 59 percent....

So there has been no employment recovery, and this is very odd because the employment-population ratio always bounces back after a recession.

The chart posted below shows how the employment-population ratio has changed since the late 1940s.  The shaded areas represent recessions.  Please take note that after every single recession (other than the current one) the employment-population ratio has always bounced back substantially.

During the most recent recession, the employment-population ratio fell farther than it had during any other recession in the post-World War II era.

If these were normal economic times, it would have been reasonable to expect a huge surge in hiring by now.

But we have not seen that.

Instead, the employment rate in the United States has been remarkably flat for more than two years.

So Barack Obama should not even begin to say anything at all about a "recovery" until the employment rate at least breaks the 59 percent barrier.

In the past I have written about how fraudulent the employment statistics put out by the federal government are.

Well, fortunately there are some folks up on Capitol Hill that are starting to take notice of this phenomenon as well.  There is a new bill in Congress that would change the way that the unemployment rate is calculated....

A Republican lawmaker is intensifying his push for legislation that would change how the government measures the unemployment rate. 

Rep. Duncan Hunter (R-Calif.) intends to press GOP leaders to move his bill to include the number of individuals who gave up looking for work in the percentage of jobless claims.

Of course there is probably not a chance that such a bill would ever get through the Senate, but at least some lawmakers are trying to get people to notice what is going on.

The sad truth of the matter is that the employment crisis in America is still about as bad as it was a couple of years ago.

Do you remember a couple of months ago when Barack Obama spoke with the wife of an unemployed engineer and asked her to send his resume to the White House?

Well, it turns out that the unemployed engineer still doesn't have a job....

More than two months after President Barack Obama asked for Darin Wedel's résumé, the phone is quiet, e-mails are no longer flooding in and the long-sought-after job interviews -- which had begun to be scheduled -- have petered out.

"Not even recruiting companies are calling anymore," said Jennifer Wedel, the Fort Worth mother of two who chatted online this year with Obama about her out-of-work husband.

She says his job search has been hurt by a program to hire skilled foreign workers.

But Barack Obama is doing the same thing on a national level.

He is promising all of us that things are improving and that there will be lots of jobs for everyone soon, but it is all a lie.

The truth is that this period of relative stability that has been purchased by unprecedented levels of government debt will soon give way to even more economic trouble.

One of my readers recently brought to my attention a list of some of the major companies that are currently getting rid of workers....

Ford will be laying off 1,200 assembly line workers later on this month.

Pittsburgh-based paint and coating manufacturer PPG has announced that it will be laying off 2,000 workers.

J.C. Penney recently laid off 600 workers and has plans to lay off another 300 workers in July.

Lockheed Martin has announced that it will be laying off hundreds of workers.

Dow Chemical has announced that hundreds of workers are going to be laid off.

Yahoo has formally announced that it will be getting rid of about 2,000 workers.

Sony has announced plans to eliminate 10,000 jobs globally.

Even Oprah Winfrey is laying off workers.  Oprah is reducing the size of the staff at the OWN network by 20 percent.

Meanwhile, our economy continues to bleed jobs at an astounding pace.  At a time when American workers desperately need jobs, millions of them continue to be sent overseas.

In fact, even some jobs that you would think would be impossible to outsource are being given to foreigners.  Just recently, ABC News did a major report on all of the roads and bridges all over the United States that are being built by Chinese companies.  If you have not seen that report yet, you can view it online right here.

If you go into a Wal-Mart or a dollar store and you start turning over products you will find that huge numbers of them are made in China and that very few of them are made in the United States.  China is absolutely dominating us on the global economic stage.  Last year our trade deficit with China was the largest trade deficit that one nation has had with another nation in the history of the world.  Yet we continue to pursue the exact same trade policies year after year.

So how is the American economy ever supposed to recover if we continue to play to lose?

As a nation we spend far more than we make, we consume far more than we produce and our federal government implements thousands of new business-crippling regulations every single year.

If you still have a good job, you should treasure it and you should try to hold on to it for as long as you can.  Soon the next major economic downturn will be upon us and millions more Americans will lose their jobs and their homes.

Things did not have to turn out this way, but we made horribly bad decisions for decades and now the consequences are catching up with us.

You better get ready.