$1.8 Trillion Annual Deficit – The Problems with Biden’s Budget

Angry Grizzly BearWith gratitude to the National Conference of State Legislatures (NCSL), their analysis of the proposed budget was broken down, and some sense was made.  Not that the news is logical, acceptable, or palatable, just that the budget documents were broken down, which was helpful.  We start with the most bass-ackwards aspect of the budget by asking one question, “Where is the money supposed to come from?”

The 2022 Budget Proposal left President Biden’s desk requesting Congress to spend $6 Trillion and add $1.8 Trillion in new deficit spending to the bloated debt the government already owes.  “Who is going to buy the bonds and make money on this debt?”  When a person employs a search engine, asking this exact question, many answers come forward, and some do not make any sense.

Peter Schiff stated:

The government doesn’t have money that it doesn’t take. Any dollar that the government spends is a dollar that the private sector can’t spend or can’t invest. The government has to take money out of the economy before it can put it back in. Nobody seems to understand this basic point because they see the Fed creating money, and they think, well, we just print money. They don’t realize that when they print money, they destroy the value of the money that’s already there. So, they’re not adding new purchasing power. They’re just redistributing it” [emphasis mine].

Thus the first problem with America’s debt and proposed budget transparent; there is no money that government can spend unless it first forcefully removes it from the owner.  That is theft, or as we recently discussed, legalized theft.  The Supreme Court of the United States (SCOTUS) has ruled that legalized plunder, legal theft, or forced taxation are the price we pay for civilization, thus making legal the government’s actions to steal money.Government Largess

Let me be clear; I am not an economist.  I select several very bright and experienced people to help explain things to me.  However, I can help others with less interest in economics understand what is happening in America right now to answer the question put forward, “Who is buying America’s debt instruments?”  The simple answer is that the Federal Treasury is buying the debt instruments, as the whole world sells their bonds and other American debt instruments.  What the Federal Reserve is doing is called “monetizing debt.”

Monetizing Debt

Gravy Train 3The definition of monetized debt is as follows. “Debt monetization or monetary financing is the practice of a government borrowing money from the central bank to finance public spending instead of selling bonds to the private sector or raising taxes. It is often informally and pejoratively called printing money or money creation.”  Money can only be created in two ways: selling products and services and lending money where the borrower pays interest.  While there are many different debt instruments, i.e., credit card, home loan, student loan, bonds, Treasury Notes, etc., the principle remains the same: you either sell goods and services to make money or lend money and make money on the interest.

Why does monetizing debt matter?

Two simple reasons the government allows debt to be monetized.  To hide debt, it doesn’t want the public to know about, and to absorb cash on the market as a tool to fight inflation.  Here’s the problem, there is too much debt on the government’s books to hide it from the public any longer.  Add to that the sheer volumes of cash in the marketplace after handing out money during COVID, and the Federal Reserve will monetize debt.  Even if the chair of the Federal Reserve denies monetizing debt, debt is being monetized.Burning money - THE JOSIAH BARTLETT CENTER FOR PUBLIC POLICY

In short terms, your pocketbook is going to take another hit on the chin, and possibly two.  First, your interest rate on privately held debt, credit cards, student loans, homes, etc., is going to go up, all while making lenders nervous and refuse to lend money.  Second, inflation is already making the dollars held less valuable.

Inflation first; inflation is the devaluation of dollars.  The government floods the marketplace with cash, and the currency you hold will drop in value.  For example, recently the inflation was reported to have been 4.6% higher year-over-year.  This announcement was made in April 2021, so all the money you earned last year suddenly became 4.6% less valuable this year, all before the interest rate increases affected those dollars.Inflation - 8 Things Everyone Ought To Know.

Case in point, the US Government sent me $1000 in January; I held onto those funds due to a move that was coming and spent the money in June.  However, between January and June, inflation moved up at a steady pace, and when I went to spend that $1000, it was only worth $850.  That is the power of inflation in your pocket.

Have you asked for a credit increase recently and been denied?  What about your credit limits on your credit cards, have they shrunk?  Both are indicators that the lenders refuse to lend due to the tremendous risks caused by fiscal insanity in the Federal Government.  What about home loans, have you had to produce more documentation, prove more income, and work harder to qualify for a loan?  What about student debt?  The government controls the lending of student debt.  Even here, the Federal Government cannot demand a lender loan money to student’s and many students have found their college expenses grow, and their ability to borrow shrunk.Inflation pickpocket | Cayman Compass

In a simple fact of life, every household in America understands perfectly. When your credit scores go down, your ability to borrow reduces, and it becomes harder to meet all your bills every month.  Every city, county, state, and even the Federal Government should know this lesson, but they refuse to believe problems arise when credit scores go down.  All because those elected believe they can tax some more, and the money magically appears.

Does money magically appear in your pocket; of course not!  It must be earned through working, selling goods and services, or trading your time for employment with an employer for a paycheck.  Does the law allow you to write blank checks, kite checks, backdate checks, or simply float a check waiting for a future payday; of course not!  Yet, this is what the government is doing right now with your money.  The government is spending money, promising the lenders that a future payday will be theirs, but the government has to spend money to get money.  Does that excuse work for you when the electric company, gas company, cellphone, and other bills arrive?A Helpful Chart : How Inflation Changes Mortgage Rates

The most heartbreaking statement I have heard in a long time was recently made by a physician’s assistant, who claimed, “Aren’t we all just one paycheck from disaster?”  The simple truth, mostly, yes!  Studies exist that talk about financial resiliency in America.  Financial resiliency is all about being able to weather a patch of trouble without losing your possessions in bankruptcy.  The conclusions were all but unanimous. Along with most industrial nations, America has no financial resiliency due to government fiscal policies that hinder saving money and the need to live on credit cards to keep the basics of life paid for each month.

When inflation is stealing the value of your money, no wage can compete with government theft, all before taxes.  Add in tax laws that are counter-productive, job-killing, and increase the cost of doing business, and the job you have becomes tenuous at best.  Add in the hidden debts the government is trying to hide, and nobody in America is making money.

QuestionWhat about those who consider themselves “Rich?”

The same problems you are having with inflation are the same problems everyone is having with inflation.  Let’s go back to my $1000 that became $850 through six months of inflation.  We all spend the same money, and inflation is killing everyone’s dollar equally!  Hence, I beg you, do not allow the media hype about rich versus poor to derail the point.  Inflation and monetized debt are killing the US Dollar, which is why so many foreign investors have dumped their US Debt instruments for safer financial shores.

While some people have more financial resiliency than others, everyone’s dollar is dropping in value.  Inflation and low financial resiliency mean making budget cuts to charities, hiring someone to maintain a lawn, and a host of other ways and means American’s share our money.  It can mean turning off services, weighing how much fuel can be used, and a host of other belt-tightening decisions.  All things the government should first be doing, and they refuse.24+ Inspirational Quotes For Unemployed - Audi Quote

Yours and my liberty and freedoms depend upon stable economic policy, firm fiscal policies, and elected officials scrutinizing the government for waste, fraud, and abuse.  Yet, what do we regularly find; fraud, waste, and abuse!  The Department of Defense has lost multiple trillions of dollars; not a single politician is asking for an audit and an explanation or is willing to withhold additional appropriations until the lost money is accounted for.  The Department of Veterans Affairs continues to mismanage funds, misappropriate funds, and waste money like overripe fruit; yet, still, we have zero interest from the politicians elected to scrutinize government.

I repeat Peter Schiff, only for emphasis:

The government doesn’t have money that it doesn’t take. Any dollar that the government spends is a dollar that the private sector can’t spend or can’t invest. The government has to take money out of the economy before it can put it back in. Nobody seems to understand this basic point because they see the Fed creating money, and they think, well, we just print money. They don’t realize that when they print money, they destroy the value of the money that’s already there. So, they’re not adding new purchasing power. They’re just redistributing it” [emphasis mine].

Inflation Quotes | Inflation Sayings | Inflation Picture Quotes - Page 2In redistributing your money, the government has proven they are the problem, and the solution begins locally!  Change your mayor, city council, county board, school boards, and every other elected official.  Getting the local governments in fiscal shape allows state governments to begin practicing fiscal health and sanity.  Then, we put people into the Federal Office more interested in scrutinizing the government than in writing endless laws and abdicating their legislative role to the executive bureaucrats and the judicial branch.

Knowledge Check!The budget put forth by President Biden is the height of insane, and I have only covered less than 1/10th of the budget problems in this article.  Granted, I covered the most egregious problem, but the fact that the legislative branch is even negotiating a compromise is beyond insanity and borders on criminal negligence!  We, each citizen of a representative government, must stand and tell our representatives NO MORE!  No more fiscal insanity, borrowing to buy votes, entering into debt obligations that make captives of unborn millions of other people.  No more will we allow them to buy votes to maintain power.  End the financial abuse of the taxpayer; your wallet will thank you!

© 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.

NO MORE BS: Understanding Money – Shifting the Paradigm on Money

LookDo you understand money?  Honestly, is how money is created, used, and tracked understandable or a complete mystery?  I have advocated for economics to be taught in high school to understand the actions of government since I was in high school.  I was forced to take a class to write checks, balance a checkbook, and other simple economic topics in US Army Basic Training.  I thought I knew how money worked after this class, but only later realized I knew enough to get into trouble with money, but not enough to fix the problems I had gotten myself into.  I was mid-way through my MBA when I finally took a class on money, economics, and how money works.

I have asked other adults and high school students what they think about money and remain aghast that basic economics is not taught in K-12 education.  There is no reason for fiscal illiteracy in America; yet, fiscal illiteracy is evident in the politicians elected, the lobbyists pushing agendas, and how American politicians of all levels understand money.  The following is a brief attempt to clear some of the confusion regarding money.

Green money is cash.

Dane-GeldGreen money is the dollars and cents in a bank account or your pocket and is quickly spent.  Green money is often called liquid money or liquid assets, liquid because the holder is presumed the owner, owns it, and can spend it freely any way he wishes.  Possession is nine-tenths of the law where liquid assets are concerned.  One of the first lessons most of us learned growing up was if you wanted to buy something and your pocket was empty, you went without.  Liquid assets are cash, green money and are available to be spent in any way the holder chooses.

Non-liquid assets are considered green money due to their sale; this is why a house, a car, a boat, and other such items are considered assets, investments, and opens the door to depreciation or money loss where an asset is concerned.  The sale of the asset provides the opportunity to turn a non-liquid asset into a liquid asset.  However, since the asset is often employed as collateral for a loan, the sale of that asset means the loan holder is paid first from the sale.  If the resale value is insufficient to cover the full loan owed, the loan, which is red money, can still be collected; this process is why red money is so important to understand.

Red money is debt.

Government Largess 3Historically, if a debt could not be paid, the debtor’s blood was allowed to be spilled; hence debt is red money.  Red money always comes with a penalty called interest.  Interest is green money turned red to return the profit to those who lent the initial funds or principle.  That debt, be it a loan, a credit card, or another debt model, remains a burden to the borrower, continues to accumulate interest, and can be called due at any moment in time.  While some laws protect the borrower from excessive interest rates, it remains essential to know about and be cognizant of the interest rate trap.  The legalese on a contract to launch a debt is important to understand, especially where prepayment penalties, late payments, and the ability to call the note due are concerned.

The interest rate trap comes in several forms.  While in the US Navy, stationed in Norfolk, Virginia, a sailor buddy bought a beautiful car for $4000 with a 45% interest rate.  He put $1500 in green money down, so the full loan amount, principal, and interest, for 60-months were $7805.49, including the sales tax.  Later that month, when the car was stolen, the insurance company valued the vehicle at only $1000, leaving the sailor to pay $6805.49 immediately.  This is one type of interest rate trap; another comes from Payday Loans.  Borrow your next paycheck today, get the money today, and pay your paycheck back during the next 36-months at an interest rate between 30-60%.  By the time the payday loan is paid off, more than four separate paychecks will have been paid to cover a single paycheck loan, provided all the payments have been made on time and as quickly as possible.

Welfare State BeginsWhile paying off this loan, you lose your job.  You can lose your car because your car is sometimes used as collateral for your payday loan.  If the resale value is insufficient, you lose your car, you lost your job, and now you still owe a considerable sum that gains interest.  Red money is dangerous; like Damocles’ sword, the danger hangs by a tiny thread above the borrower; one wrong move and the sword falls.  Debt, red money can be helpful; but, careful planning and budgeting are required before entering into debt obligations.  Always it is better to save and budget green money or obtain investors before contemplating debt.

Black money is dead money.

Consider the person who takes green money and places those dollars and cents under a mattress or coffee can in their home.  The cash is out of circulation, is not valuable enough to collect, and no one is benefiting from the money through interest.  Black money can be created in other ways that will be explored later in this article.

Potential Money – Blue Money

blue-moneyThe next type of money is blue money, also referred to as potential money.  Consider a hammer. The hammer might cost $20.00 in green money to buy and bring home.  In the hands of a trained construction worker, a $20.00 hammer, over the course of the hammer’s useful working life, has the potential to earn thousands of dollars in green money for the construction worker.  In the hands of an inexperienced worker, the hammer has the potential to cost thousands of dollars in green money through waste, destruction, and learning.  Training a person to improve their performance might cost $300 in green money; but, if that employee can improve his performance on the job, potentially millions of dollars can come into the company because of the training provided.

Money is created when it is borrowed, and interest is paid on the loan.  For example, Jack has an extra $500 (green money).  He gives this money to his friend Joe in the form of a loan (red money).  Joe takes the loan, adds to his business potential (blue money), and through increased profits, can pay Jack his $500 loan plus the interest of $300.  Hence, $300 (green money) is created as profits for Jack.  While a simple analogy, do the types of money become more apparent?

Welfare State EndsJoe’s loan to Jack showed on Joe’s books as red money until the loan and interest were paid.  During this time, Joe was also making green money, or profits sufficient to pay his workforce, his other obligations, and still retain adequate to pay himself.  Small business owners are not paid until everyone else is paid.  It is not uncommon for small business owners to be scraping by on the smallest margins because all their non-liquid assets are locked up in loans to keep the business afloat.  When poor business practices begin risking inventory and equipment and shareholder investments are added into the equation, is it any wonder why small businesses struggle.

quote-mans-inhumanityMoney is also created when saved in the various saving tools offered by banks.  The diligent saver can save $40 a week until he or she is 65 years of age and potentially have millions in the bank for retirement.  Why, because the bank will pay interest to the saver from the interest collected on the loans the bank makes with the green money invested from the savings account.  Many different savings tools can be considered non-liquid assets because of the agreements made between the saver and the bank.  Generally, the longer the bank’s contract to hold the savings money, the higher the interest rate paid as the bank can schedule payments and loan the same dollars more efficiently when the saver’s funds are expected to be in the bank for a more extended period.

quote-mans-inhumanity-2Often Federal treasury departments of governments create money by printing more or larger bills.  The problem with printing more money is one of surplus, which begins to increase interest rates and decrease the value of the green money held by citizens participating in the economy.  Consider that if the only way to create money is to work money through lending, improving business, etc., and then printing only makes it harder to put money to work.  Too much money on the market creates negatives; negatives include lower dollar value, which makes items cost more and increases interest rates, making borrowing costs rise, and inflation begins to increase prices for goods in the economy.  More importantly, except for necessities, producers’ willingness to spend money stops; these are typical cause-and-effect actions.  A long enough period of decreased desire to spend money and an economic downturn is initiated.

Blue Money BurningState, City, County, Town, municipal governments are even more pernicious with their plots and plans.  On the local government level, money cannot be printed.  Hence, debt is entered into, and municipal bonds are sold to create money in the private sector, which is then paid to the government in increased taxes, but the money lent to the local government was already spent.  One truth discovered about government, when taxes are increased, money is asked of the voters to borrow.  The truth is, the government body asking for more has already spent the increase, spent the budget, and usually spent twice as much as they are asking the voters to allocate.  Consider special elections for increasing taxes; the money being asked for has been spent, the budget was spent, and now the voters are asked to pay for the special election cost to decide if the local government can spend some more money.  The increase being asked very often has been spent three to four times before the election is considered to ask for permission to enter larger amounts of debt in the public’s name.

Poor fiscal planning increases debt by decreasing the value of the original municipal bonds.  The government has to borrow more to get relatively close to the value of the first municipal bond sold.  Note, municipal bonds are considered a debt to the local government and as green money non-liquid assets to the purchaser; municipal bonds can be bought and sold on the private market.  Government focuses upon the holder of the most bonds; because elected leaders are focused upon the holders of the most bonds, citizens bear no weight in being heard.  Money talks!

Detective 4In several different locales, municipal bonds can be held as unseen debt or black money, also referred to as unfunded liabilities, kept on other books, not currently open to the public.  The monies owed are not considered red money because there is no plan by those in power to pay these debts; thus, the city’s debt could be significantly higher than reported.  Unfunded liabilities never have a plan for repayment by those in power.  Unfunded liabilities can be a mixture of many different debts (employee retirement, some municipal bond types, unpaid bills to local service providers, etc.).  The common denominator remains, there is no plan or money to repay this debt.  Thus, black money is created because there are no plans or money to meet these obligations.  The taxpayer remains on the hook for the principal and the interest of those unfunded liabilities.  Unfunded liabilities are hopes of current politicians on future prosperity, and sometimes, depending upon laws, unfunded liabilities are part of the government’s credit rating. Low credit ratings by the government increase taxes, the risk increases, making borrowing money more expensive, and the taxpayer generally has no idea how poor their municipal government’s credit rating.  Never forget, municipal government, many times includes the local school board.

ToolsWhile this explanation is elementary, the lessons contained are sufficient to protect the bottom-line, improve knowledge, and provide an opportunity for improving circumstances.  When bottom lines fail, before anything else, look to lost blue money as the cause.  When blue money is disregarded long enough, red money increases exponentially, and green money evaporates; this formula is set in stone.  Potential blue money is not elusive, but it takes keen observation to protect and grow.  Grow enough blue money, and green money multiplies exponentially.

Americans must start demanding fiscal literacy in the politicians running for office.  Americans must begin understanding the captivity they are in where the government spending is concerned.  Ask yourself, would your bank honor a post-dated check?  Why should the government be allowed to write a check the bank won’t allow you to write?  Can you spend 8-15 times your salary between paychecks and maintain your house, car, and other assets?  Of course not, so why should the government be allowed to do this on your tax dollars?

DutyFiscal literacy improves freedom and liberty.  Fiscal literacy is required to maintain the US Constitution and US Bill of Rights.  Budgets are not bad things for government to live on; in fact, the government should be the first exemplar of budgetary soundness and fiscally literate action.  A Liberty FIRST Culture will require fiscal sanity and fiscal restraints, a reduction in debt, and a payment plan for all unfunded liabilities.

© 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.

NO MORE BS: Liberty First Culture – Awake and Arise

William Shakespeare, in “The Rape of Lucrece” (lines 211-214), states:

“What win I, if I gain the thing I seek?
A dream, a breath, a froth of fleeting joy.
Who buys a minute’s mirth to wail a week,
or sells eternity to get a toy?”

RememberConsider these lines for a moment, not as part of the greater work, but as a pattern to be laid over the actions of the politicians elected to office, who have sold liberty and freedom for “a toy.”  Those same politicians who will seek their personal gain as a “dream, a breath,” or a “fleeting joy” are the same politicians who will buy with your money mirth, happiness, and prosperity so that the rest of the country can wail, cry, and suffer.

At its founding, the Republic struggled to get out of debt caused by the Revolutionary War.  Through work, sacrifice, and determination, the captivity of debt was eventually canceled.  The debt was considered captivity and remains the antithesis of liberty.  Yet, everywhere we look, the politicians buy personal power, with the public’s money, for a minute of fleeting joy, while everyone else suffers for weeks and years on end.

Government Largess 2As a kid, I read a Newsweek or Time article on how long the National Debt would take to pay off.  I have never found this article again, which is a tragedy, for I would quote the source heavily.  However, since the debt has ballooned over the last four American Presidents, it would be safe to say that the article I read as a kid is “out of date.”  We find some troubling facts about debt’s captivity from the Foundation for Economic Education (FEE).

Consider the following, economics is not a hard and challenging topic, and I promise what is being offered is easy to follow.  Gross Domestic Product (GDP) is what the country earns as a paycheck.  Currently, what we owe on the national debt is 106 times greater than the GDP.  This means that with interest for the debt presently owed, America cannot produce enough to cover the payments for the fleeting joys enjoyed by her politicians.  Essentially, since America cannot produce more products for trade and sale, the ability to meet our debt obligations per paycheck has been wiped out, and we still owe more per paycheck than we earn.

ProblemsConsider what happened with Hurricane Katrina: hundreds and thousands of people were displaced, hundreds needed airlifts of food and water, thousands of homes were flooded, and Katrina’s recovery cost is still ongoing.  President Bush II took a political hit by the media, and the political left and their media lapdogs had a field day on the suffering and devastation during an American Natural disaster.  Would you be surprised if I told you the real culprits for failing to protect the citizens from harm properly was not the Federal or State government’s job?  Would you consider that the local authorities, even some of those who went to jail for embezzlement, were guilty of other crimes that have so far gone unpunished?

Shortly after Hurricane Katrina, several states suffered major flooding.  Iowa was one of these states.  The flooding in Iowa was just as traumatic and costly, but no one ever hears a word about this flooding unless you follow natural disasters as a hobby.  Why the difference between Iowa and Louisiana?  The response by the local government.  The local government’s planning and preparation and the lack of dependence upon the Federal Government to “swoop in and save the day.”

Duty 3The government is not a superhero.  The government is not the answer to local problems, emergencies, and natural disasters.  Your neighbors, friends, and families are the superheroes.  That is where one looks in times of trouble, not the government!

I learned this lesson one Sunday as a child of six or seven.  Salt Lake City had enjoyed a tremendous amount of snowfall that winter, and spring floods came with a vengeance.  A gentleman walked into the chapel where we were meeting, asked for the congregation’s attention, and called on every able body male to man shovels and help sandbag streets to steer the floods.  The Jordan River overflowed into my school, canceling classes.  For weeks on end, every able man from 12 to 99 spent countless hours volunteering to work on the dikes, doing extra hours to cover the shift of a volunteer on the flood project, and I do not know how many meals were donated to feed the workers.  I know Salt Lake faced significant flooding, and I know the community was stronger for the local action, rather than waiting for any State or Federal Government protection.

Iowa faced the floods, the communities held the floodwaters in check, and the communities had help from unaffected areas to steer the floods and recover after the flooding ended.  New Orleans counted on the government, and the damage is still being paid for, hurting the area and causing havoc.

LookAs a point of fact, everyone who thinks the US Government is the superhero must remember, the Federal Emergency Management Agency (FEMA) has the right to tell a state, No!  As in, No; the resources of the Federal Government will not arrive to help you.  No, the Federal Government will not be paying for this disaster.  No, the failure to prepare properly is not the problem of the Federal Government.  The Governor can activate the US Army National Guard, but if they do this, the State is on the hook for the full cost of mobilization, and if FEMA says No, then the State now has more budget problems than previously expected.

FEE reports that every time a politician has attempted to cut or reduce the government goodies, there has been ferocious outrage.  Ever try to tell a two-year-old child No!  Yet, the captivity of debt has now breached:

  • $68,400 per citizen
  • $183,000 per taxpayer
  • The Federal Government currently holds debts on $125 Trillion in unfunded loans.
      • Unfunded liabilities are what we ordinary people call check kiting.
      • There is no plan to pay for these liabilities.
      • There is no money to fund these liabilities.
      • There is no GDP available to fund these loans.
  • Want to know why you cannot obtain a reasonable interest rate on saving money, certificates of deposit (CDs), and other money-saving tools offered by banks. The National Debt!

The most troubling fact of all:

      • It would take the United States 713,470 years to pay down the national debt if we paid $1 per second of the year.

Detective 4How many future generations have been squandered by the purchase of a minute’s mirth by the politicians, the lobbyists, the media, and the government employees who implement the politicians’ policy in the Executive, Legislative, and Judicial branches of government?  A generation is 20 years.  Hence, it will require 35,673.5 generations to pay off the National Debt, if we started paying right now, at $1.00 per second, or roughly $86,400 per day (31,536,000 a year approximately), every day, for the next 713,470 years.  Many people will proclaim loudly that paying off that large debt is “impossible,” yet we will never know the freedom of being debt free as a nation if we do not begin.

I have heard economic postulants proclaim that debt is a good thing, but common sense tells us that being in debt is captivity, prison, to the interest, and the principal owed.  Debt is never an easy taskmaster, yet the government has helped millions of Americans be saddled with untold debts through student loans, housing loans, and other obligations to fund the politician’s minute of mirth.  There are smarter and more efficient ways to create wealth than through debt, and while somewhat slower, the methods are more effective and carry less risk while allowing liberty to thrive.

VirtueThe sad but undeniable truth is this, a “Liberty First Culture” must acknowledge the elephant in the room, the national debt, and the harsh taskmaster’s debt and interest.  During the Clinton years, the fiscal games only hurt America and the world, never balancing the budget or paying down the debt.  Liberty is a priceless commodity but is easily destroyed through debt.  Public debt can only be entered into by politicians; politicians feel they are immune from the taskmasters of debt and interest because they were elected.  This mental disconnect from the action and the consequence responsibility is the key to changing the discussion in national, State, and local capitals on publicly funded debts.  For the other sad and undeniable truth, the National Debt is just the beginning of the debt problems facing America.

Suppose you live in Illinois, California, New York, Maine, New Mexico, Washington, Oregon, Wisconsin, Michigan, West Virginia, or Virginia. In that case, your State has some of the worst problems where state debts exceed the state GDP, and those debts are killing your State.  There are cities like New York City, San Francisco, Los Angeles, Detroit, Chicago, etc. that have city debts equaling or exceeding the state debts.  This debt captivity is killing your wages, your future, and your city.  All because a politician, somewhere in time, regardless of the political party, purchased a toy with your liberty and told you this was a good thing.  Why are your roads and bridges crumbling beneath your feet and your cars; because the politicians borrowed from one hand to purchase a toy in the other hand and left unfunded loans as “IOUs.”  Do you have a state pension you have been counting on to retire; guess what?  There is no money in those funds either because of unfunded liabilities to purchase that minute of mirth.

LinkedIn ImageA “Liberty First Culture” requires the adults in the room sanction the politician, restrict the checkbook, and demand debts begin to be reported clearly, concisely, and coherently, include all unfunded liabilities, and then start planning a method to repay the debts even if it means shrinking the size of government.  Even if it means less nation-building outside America’s borders.  Even if it means ending the meddling, we do in other nations to instruct them on “gender equality” or other nonsense that does nothing but waste your tax dollars and my tax dollars.

Demand a “Liberty First Culture!” in every person running for political office!

 © 2021 M. Dave Salisbury
All Rights Reserved
The images used herein were obtained in the public domain; this author holds no copyright to the images displayed.

NO MORE BS: Literacy and Liberty

Gadsden FlagThere is a legal axiom that everyone should know and fear in the biblical sense, “Ignorance of the law is not a valid excuse.”  When I first heard this hypothesis, my initial thought was, “How totally bogus!!!”  As I have learned, as my literacy levels have climbed, and as my understanding has deepened, I understand the principle in this axiom more completely.  The principle is not to sow doubt and fear in a populace but to promote learning because liberty is both precious and easily removed.  As a point of reference, the preciousness and removal of liberty have been studied. Through their ignorance, those who are illiterate of the law are more susceptible to be disadvantaged by the law.

How did the housing bubble happen?

Sure, the government reduced regulations, played with interest rates, and created the problem.  Banking is a business, and the first rule of business is to return profits to the investors, so the banking industry dove headfirst into getting people into homes.  State governments helped fuel this problem with deregulation, tax breaks, and incentives, increasing their debt levels to invest in housing people.  I will fully support that everyone involved possessed altruistic motives: altruism, the belief in or practice of disinterested and selfless concern for others’ well-being.

Detective 2Except … research supports the conclusion that despite fairness doctrines written into laws, illiterates are more disadvantaged in legal dealings.  Never forget, functional illiteracy was a desire of Dewey in the late 1860s as a means of reducing the power, liberty, and freedom of populations through K-12 education.  We must start understanding the origins of the problem to empower and plot a working solution.  Academic research is purposefully vague and inconsistent on the lines of congruence between functional illiteracy and individual wealth and economic mobility, all while taking advantage of the inconsistencies where the law is concerned.

Stevens (1985) reviewed the data and found a relationship barrier, “the crudeness of the literacy/illiteracy measurements, and a finer distinction was required.”  The data he used was from the 1870s and showed that literacy barriers were dependent upon age; the older the person, the less likely they were to be literate and more likely to be taken advantage of by the law.  Does this sound familiar where the housing bubble was concerned?

Root Cause AnalysisJen Deaderick, writing for the National Bureau of Economic Research (NBER; 2018), provides vital insight into how hard and deeply the housing bubble affected lower-income people and minority populations.  One of the more brutal consequences of the housing bubble was the extreme credit card debt carried by lower-income minority populations and how these populations have never recovered to 2007 income levels.

Demos and NAACP co-authored a research report declaring how credit card debt in lower-income and minority households is seen as a “safety-net.”  While these populations are actively working to pay down their credit card debt, the credit card usage remains high, and the pay-down and usage cycle hinders wealth growth.  I have now asked this question of school boards in several states and with teachers in high schools, “Why is economics not taught in high school?  Especially how to budget money, creating money, money intelligence, etc.”  The answer is always the same, “That is a good idea, but there is no time or interest in teaching those uninteresting topics.”  I have found that teachers are some of the highest credit card users in the various professionals, far outstripping commissioned salespeople.

Returning to the premise that functional illiteracy, chiefly where finances and the law are concerned, sees a tremendous and disproportionate abuse of lower-income and minority people at the hands of contractual law.  According to the law hypothesis stated above, their illiteracy is their fault, and thus the abuse is their problem.  Yet, if a person’s illiteracy was purposefully inflicted upon them by, say government, who is responsible for the illiteracy?

Oops!I fully submit that after K-12 Education, a person is recognized as an adult, fully responsible for their actions or inactions based upon what they learned in school, to become a productive member of society.  I have learned and am still learning tough and difficult lessons regarding personal literacy and financial decisions, literacy and law, liberty and literacy, and much more.  Yet, I read, I try to expand my mind, I make choices and suffer or enjoy consequences based upon those choices.  I understand the process because I have wanted to know more.

Research on reading shows that a vast majority of Americans never read a book after high school, including those who go onto college.  Worse, many students in junior high and high school never read a book; but complete reading assignments using search topics and Google.  Why; because being literate is considered “nerdy,” “reading is difficult,” “reading is not intellectually challenging,” and the excuses run on ad nauseam and ad infinitum.  All of which has been the aim of the acolytes of Dewey and Wundt since the 1860s.

Stevens (1985) expressed an idea important to literacy and freedom.

It is obvious that if literacy skills are required to exercise voting rights, for example, the worth of liberty for the illiterate person is severely diminished.”  In the decisions of State v. Sweeney (1950) the Court argued for “equal opportunities under the law,” but added: “lt is not possible for constitutions or legislation to make all men equal in understanding, intelligence and education.”  State legislation tended in the direction of equality of education even to the point of “compelling the youth of our country to take advantage of these opportunities.” But the Court acknowledged that “in every phase of our social and civic life, the uneducated man is at a disadvantage.”

Detective 4Except the case can be made that the State, with the Federal Government’s aid, has created the uneducated person, purposefully to abuse a population for political power.  When teachers tell a student they cannot learn, need Ritalin, are dyslexic, as agents of the State, they are declaring the student’s potential—locking the student into a life of purposely being taken advantage of by contractual law and other forms of law.  Who gave the teachers the right to demand a student be placed on harmful drugs to exist in a modern classroom, the State.  Who gave teachers the authority to diagnose a student as “dyslexic,” the State.  Why were teachers granted this power; why was the power stripped from parents; because Dewey wanted to control populations through literacy ability.  Dewey considered a literate person a danger to society, following an unnatural god, and possessing the power of a tyrant because they knew their language and could express themselves.

My next younger brother, Steven, is an imaginative, brilliant, and incredible person.  But, he got frustrated when trying to learn; the more frustrated he got, the more unbearable to be around he became.  Years of being told to shut up, sit down, and pay attention, has left him a shell of a person.  Teachers actively refused to answer his questions because he has a problem correctly describing the question in words.  He does not have a learning disability.  His brain works differently from the rest of a classroom population.  When he found a teacher that could help him, that was the height of his education in K-12.  He was passed onto another teacher to “be their problem” until he dropped out of school in frustration.  Unfortunately, in my family, two other brothers followed the same pattern.  Three lives have been blighted and wasted because the teachers measured potential by poverty and failed to educate, the school boards refused to teach and educate, and the State supported the teachers and school board.

Theres moreHow often does this story repeat in your family?  How often does this story repeat in your school?  How often does it repeat in your community, state, and nation?  The short answer, “Too bloody often!”  These are the people to whom the law abuses, contracts are a noose around their necks, voting ballots are a blur, and who will never leave the captivity of illiteracy!

Would you, the audience reading this blog, be surprised to find yourself in the same category as my brothers?  Abused by contractual law, abused by other laws, held in captivity due to your limited education and poor literacy abilities.  I am not judging you or your potential; by merely reaching out to find information and reading this blog, you are trying, and I commend you for your efforts and will help your progress any way I can.  But, we all have been abused, seen our potential limited, and lost liberties and freedoms based solely upon the education received at the hands of the State.  Surprised; I was when I started researching these topics.  Now, I find myself feeling more like a soaked chicken with a raging case of hemorrhoids.

Scared Eyes!Your command of your language has been intentionally limited, and each successive year, it has been reduced.  For example, while insignificant, my knowledge of literature is greater than my sister’s, and her command of the language is magnitudes greater than my youngest brother.  Want an interesting experiment, next time you have multiple generations of your family around, ask them what words mean and how to use them in sentences.  You will find similar generational gaps in literacy, even if those family members do not read.

I met an incredible family in Northern Ohio, 18 kids born to the same husband/wife team.  When the younger kids need help with homework, they call a big brother or sister.  Dad is a construction worker, very skilled with his hands, brilliant in planning and carrying out projects, but never considered “worthy” of higher education.  Mom is well-read, intelligent, and a savvy thinker, but the school boards deemed her potential.  In both cases, the school board was exceedingly wrong, but the hold was too powerful to shake.  Their story is replicated, maybe not with as many kids, from Maine to Washington, from Florida to Montana, and every stop in between, and it remains abhorrent to me!

LookYour potential to learn is not governed by what a teacher or school board has determined.  Your potential is only limited by you and your choices.  If you know someone who struggles, please help them, for you will find that empowering a mind to learn is the most incredible feeling in the world!  To know you have brightened a mind to shake off the shackles of captivity gives you the confidence to improve your own understanding and to repeat the feat!  Please, help end the abuse of the law, through literacy which increases liberty and freedom!  Because we are all connected, increasing liberty and freedom for one person increases liberty and freedom for everyone.  The truth is apparent, “One raindrop raises the sea!”

Reference

Stevens, E. (1985). Literacy and the worth of liberty. Historical Social Research, 10(2), 65-81. https://doi.org/10.12759/hsr.10.1985.2.65-81

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