FedUpUSA

Archive for the ‘taxes’ Category

Did you know that the federal government is giving out free cell phones and free cell phone minutes to welfare recipients?  It may be hard to believe, but it is true.  Right now, there are companies that are running advertisements specifically targeted at low income Americans informing them of the fact that all they have to do is sign up and they can get a free cell phone and hundreds of free cell phone minutes every single month and it will all be paid for by the federal government.  Some have referred to this as “The Obama Phone”, but that is not exactly accurate.  The outrageous federal programs that are paying for this were initiated before Barack Obama entered the White House.  But the fact that welfare recipients have been receiving free cell phones and free cell phone minutes under both the Bush and Obama administrations has been confirmed as being true by Snopes.  All of this is paid for by “the federal Universal Service Fund”.  That is one of those annoying little taxes that you may have noticed on your phone bill.  So what is essentially happening is the federal government is taking money from all of us so that they can provide free cell phone service for welfare recipients every single month.

When some of my readers informed me of this free cell phone scheme, I decided that I better go to the source.  So I went over to the FCC website, and it turns out that there are two federal programs involved.  “Link Up” provides a one-time connection discount on phone service, and it can be applied to the cost of a cell phone.  So this is where the free cell phone comes from.  “Lifeline” provides a monthly discount on telephone service.  So this is where the free cell phone minutes each month come from.  The following is a description of these programs from the FCC website….

What Benefits are Available Under the Lifeline and Link Up Programs?

• Lifeline provides discounts on one basic monthly telephone service (wireline or wireless) for qualified subscribers. These discounts can be up to $10.00 per month, depending on your state. Federal rules prohibit qualifying low-income consumers from receiving more than ONE Lifeline service at the same time. That is, qualifying low-income consumers may receive a Lifeline discount on either a home telephone or wireless telephone service, but may not receive a Lifeline discount on both services at the same time. Lifeline also includes Toll Limitation Service, which enables a telephone subscriber to limit the amount of long distance calls that can be made from a telephone.
• Link Up Up provides qualified subscribers with a one-time discount (up to a maximum of $30) off of the initial installation fee for one traditional, wireline telephone service at the primary residence or the activation fee for one wireless telephone. It also allows subscribers to pay the remaining amount they owe on a deferred schedule, interest-free. Federal rules prohibit qualifying low-income consumers from receiving more than ONE Link Up discount at a primary residence. That is, qualifying low-income consumers may receive a Link Up discount on installation or activation charges associated with either a home telephone or wireless telephone service.

Apparently these programs are becoming quite popular.

You can find a company called Safelink Wireless offering welfare recipients a free cell phone and 250 free cell phone minutes a month right here.

You can find a company called Assurance Wireless offering welfare recipients a program that is virtually identical right here.

This is absolutely outrageous, and it is yet another sign that dependence on the government is totally out of control.

Not that assisting the poor is bad.  Of course we always want to help those that cannot help themselves.  We never want to see anyone go without daily food or sleep in the streets.

But providing the poor with the basics of life is much different from providing them with luxuries such as cell phones.

In some areas of the country, the poor can also receive nearly free Internet service every single month.

Just check out the following example from the Houston Chronicle….

When Comcast acquired NBC Universal earlier this year, an FCC-mandated requirement was that the cable giant offer cheap Internet access to low-income households. Comcast is making good on the mandate through a new program called Internet Essentials.

Families who qualify will be able to sign up for 1.5-Mbps Internet access – the same download speed as AT&T’s basic DSL service – for just $9.95 a month. Customers may also be eligible for a computer that costs just $150 and free Internet training.

Also, a new bill has been introduced in Congress that would give “eligible” 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.

These days, as long as you are “eligible”, just about everything you need will either be purchased for you or subsidized by the federal government.

Yes, we will always need programs to help take care of the poor, but some of the things that go on today are absolutely outrageous.

There are millions of people out there that have become extremely comfortable receiving government benefits and it will be extremely difficult to ever get them to give them up.

After all, why bust your behind for 40 or 50 hours a week at some meaningless, low paying job when you can live a similar lifestyle by just depending on government benefits?

The following is a rap video that shows the kind of mindset that is developing all across America.  Please be advised that it contains some very strong language.  It was done by a rapper known as “Mr. EBT”, and it is a perfect example of the kind of attitude that many welfare recipients have today….

Yes, everyone needs a helping hand once in a while.  But if you do have to rely on government benefits for a time, you should be fighting like crazy to improve your situation so that you can get off of them as soon as possible.

Of course the biggest welfare recipients of all are the big corporations.  The federal government showers billions upon billions of dollars on them every year, and this has got to stop.

The following example comes from an article in the Weekly Standard….

General Electric, one of the largest corporations in America, filed a whopping 57,000-page federal tax return earlier this year but didn’t pay taxes on $14 billion in profits. The return, which was filed electronically, would have been 19 feet high if printed out and stacked.

Can you imagine a 57,000 page federal tax return?

That is absolutely disgusting and it is a perfect example of how corrupt our system has become.

All year long, GE has people pouring over the tax code just looking for any little tax loophole that it can exploit.

GE made $14,000,000,000 in profits, but they paid less taxes to the government than you or I did.

There is something very, very wrong with that picture.

All of this unnecessary welfare has got to stop.

No more free cell phones for people on welfare.

No more giving billions of dollars in tax breaks to big corporations.

We simply cannot afford it.

The U.S. debt problem is way, way out of control.  We have piled up the biggest mountain of debt in the history of the world, and it gets about 150 million dollars worse every single hour.

Sadly, none of this is likely to change any time soon.

The big corporations provide the money that our politicians need to win campaigns, and most of our politicians are very careful not to bite the hands that feed them.

On the other end of the spectrum, our economy continues to crumble and the number of poor Americans continues to increase.  So even if we don’t provide them with free cell phones, the truth is that the number of Americans that need basic food and housing is not going to go down any time soon.  In fact, it is going to go a lot higher in the years ahead.

We are rapidly becoming a European-style socialist welfare state.

In America today, the poor are absolutely showered with outrageous government benefits and so are the big corporations.

So who pays for all of this?

You and I do.

I am afraid that the joke is on us, and nothing is going to change as long as we keep sending the same kind of politicians back to Washington D.C. over and over.

The Economic Collapse

I’ve watched this movement, I’ve talked to people within it, I’ve observed.

And now I have to ask the salient question: Where do you actually stand on one important part of the issues facing this nation — and indeed the world?

You need to decide.  And the question being asked here is simple: Do you or do you not accept, and formulate all of your other views and premises, around the following central point — “Government must spend no more than it taxes.”

It’s a yes or no question and no weaseling is allowed.

A “yes” answer means, incidentally, that the government must cut spending by some 45%, raise taxes by 45% of the budget in received funds (not “rates” on some group — incidentally this is pretty close to a 100% tax increase!), or some combination of the two – right now.

Now let me put the gauntlet down in front of you: If you don’t support this, and come out for an immediate cessation of all deficit spending pretty much in the contemporary, immediate format, I cannot support you — and neither can anyone else with any hint of intelligence.

I recognize that “the 99%” believe they got screwed by the banksters (the “1%”, which really ought to be the 0.01%.)  You’re right.  But screwing others will not make you whole.  You cannot become better off economically by taking a dollar from one pocket and putting it in the other.

This means that the “Free $hit” army nonsense has to be eliminated from your ranks, from your speech, from your demands and from your protests.  And it has to happen now.

It should happen because you voluntarily recognize that continuing it is (1) destructive because it is (2) impossible to provide and thus (3) you will contribute to the destruction of this nation and her government if these demands continue.

Note that this does not mean you can’t argue for justice.  Justice occurs when you borrow money and can’t pay — you go bankrupt and lose your “stuff” and your credit rating.  But it also means that the person who loaned the money loses his or her investment at the same time.  That is justice — not getting a “free house” or “free education” because you “deserve” it.

It is the latter half of the check and balance found in justice that hasn’t happened.  It is the frauds involved in making bogus loans, securitizing bogus loans and lying about them, then knowingly selling crap labeled as “Grade A Chocolate”, cost-shifting in the medical system and exempting student loans from bankruptcy that has led to these problems.   Private banks put all this crap together and lobbied for it, getting the ability to steal from the common man in the process because people demanded “free stuff” and to get it government had to deficit spend.  That in turn resulted in the ability to cover up the economic rot caused by offshoring your jobs and destroying our economy — for a while.

The limits of that cycle have been reached.  It thus now will end, not because someone wants it to or doesn’t, but because the math mandates that it cannot continue.

If you continue to press for this destructive cycle to continue the damage that will be done our nation, to you, to your children and grandchildren will go up exponentially.  That damage may reach the level of government and civil society collapse, and if it does odds are that what comes out the other side is much worse than what we have now in terms of corruption and loss of freedom.

In short, we have to be adults and cut that crap out — right now.

So read the question above, debate it and then answer it.  Do so in your General Assemblies, on your mailing lists, in your public pronouncements.  But do it soon, because just as the Tea Party was co-opted by the “Guns, Gays and God” radical right wingnuts I see the same bomb-throwing rhetorical garbage corrupting what you’re trying to do from the radical left.

There is no solution in the GGG radical right wing.  It won’t work because it does not demand the cessation of the theft and fraud, the end of deficit spending right here, right now, today, and the prosecution of those who committed fraud upon the public everywhere we can find it.

But likewise there is no solution in the “bomb-throwing anarchist” left wing or calls for more “free stuff.”  It won’t work for the same reason: It does not demand the cessation of the theft and fraud, the end of deficit spending right here, right now, today, and the prosecution of those who committed fraud upon the public everywhere we can find it.

You must, and only you can, decide.

Is OWS a force for positive change, or have the real and just complaints that led to your formation been co-opted by those who have no solution to offer that can actually work and will advance justice and freedom for everyone in society, just as the Tea Party was co-opted and hi-jacked?

I, and others, are waiting for your answer.

One of the most important steps that we could take to bring prosperity back to America would be to nationalize the Federal Reserve. Doing so would allow the federal government to quit borrowing money, dramatically reduce taxes and eventually pay off the entire U.S. national debt. Instead of inheriting the largest debt in the history of the world, future generations would actually have a chance at economic prosperity because they would not be forced to pay off the horrific debt of previous generations. The Federal Reserve is a perpetual debt machine, it has almost completely destroyed the value of the U.S. dollar and it has an absolutely nightmarish track record of incompetence. There are no good reasons to keep the status quo. Our current debt-based monetary system will inevitably lead to a complete and total economic collapse. We desperately need to make a change while we still can. As you will see below, there are a ton of good reasons why we should nationalize the Federal Reserve.

Right now, most Americans believe that the Federal Reserve is actually an agency of the federal government. But that is simply not the case. The truth is that the Federal Reserve is about as “federal” as Federal Express is.

The Federal Reserve openly admits as much. For example, in defending itself against a Bloomberg request for information under the Freedom of Information Act, the Federal Reserve stated in court that it was “not an agency” of the U.S. government and therefore not subject to the Freedom of Information Act.

So who owns the Federal Reserve?

As the Federal Reserve’s own website describes, it is the member banks that own it….

The twelve regional Federal Reserve Banks, which were established by Congress as the operating arms of the nation’s central banking system, are organized much like private corporations–possibly leading to some confusion about “ownership.” For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.

The debt-based monetary system established by the Federal Reserve has greatly enriched the big banks and the people that own them. This has been at the expense of the American people.

A private central bank should not issue our currency, set interest rates and run our economy. Rather, we need to return control over the currency to the American people where it belongs.

The following are 14 reasons why we should nationalize the Federal Reserve….

#1 The U.S. Constitution says that the federal government is the one that should be issuing our money.

In particular, according to Article I, Section 8 of the U.S. Constitution, it is the U.S. Congress that has been given the responsibility to “coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”.

#2 Our current debt-based monetary system is a perpetual debt machine. It is absolutely imperative that we nationalize the Federal Reserve and begin to issue debt-free money.

In a previous article about money and debt, I explained how more government debt is created whenever the U.S. government puts more money into circulation….

When the government wants more money, the U.S. government swaps U.S. Treasury bonds for “Federal Reserve notes”, thus creating more government debt. Usually the money isn’t even printed up – most of the time it is just electronically credited to the government. The Federal Reserve creates these “Federal Reserve notes” out of thin air. These Federal Reserve notes are backed by nothing and have no intrinsic value of their own.

This process creates a huge problem. When each new dollar is created, the interest owed by the federal government on that new dollar is not also created at the same time.

Therefore, more debt is actually created than the amount of money that the federal government receives from the Federal Reserve.

This is a Ponzi scheme that is designed to drain wealth from the American people and transfer it to the banking system.

This is why I call the Federal Reserve system a perpetual debt machine. Today, the U.S. national debt is more than 5,000 times larger than it was 100 years ago.

Back in 1910, prior to the passage of the Federal Reserve Act, the national debt was only about $2.6 billion.

By going to a system of debt-free money, the U.S. government would never have to borrow a single dollar ever again.

#3 Our current debt-based monetary system requires very high personal income taxes to pay for it. It is no accident that the personal income tax was introduced at about the same time that the Federal Reserve system came into existence.

If we nationalized the Federal Reserve and capped federal government spending at a reasonable percentage of GDP, it would be entirely possible to massively cut taxes and still keep our promises regarding Social Security and other important social programs at the same time.

I believe that eventually the entire personal income tax system could be completely wiped out and the IRS could be totally shut down. This would save our economy billions upon billions of dollars in income tax compliance costs.

However, as an initial first step, I believe that we should eliminate all payroll taxes, all “self-employment taxes” and all taxes on the first $100,000 earned by every American.

This would provide much needed relief to the millions of poor and middle income families that have been hurt so badly by this economic downturn.

Also, I believe that we could instantly reduce the corporate tax rate to levels that would be competitive with the rest of the world, while closing corporate tax loopholes at the same time. This would remove the temptation for companies to leave the United States in order to escape our brutally high corporate tax rates.

Yes, the proposals above would definitely cut taxes.

So where would we make up the difference?

Well, the U.S. Constitution provides one clue. According to Article I, Section 8 of the U.S. Constitution, the U.S. Congress has the right to impose “duties, imposts and excises” on goods sold in this country.

For way too long, big corporations have been taking advantage of sweatshops in the third world. For way too long, other nations have used predatory trade practices to take unfair advantage of us. For way too long, we have allowed nations with horrific human rights records to ship their goods into our country for free.

Well, we need to bring that to an end. By raising tariffs we would raise money for the federal government and we could potentially start to reverse the flow of jobs and businesses that have been leaving this country.

Access to the U.S. market is a privilege, not a right. High tariffs would be imposed on goods from any country that allows slave labor wages to be paid. Very high tariffs would be imposed on goods from any country that is using predatory trade practices against us. Extremely high tariffs would be imposed on any nation that does not respect basic human rights.

However, please keep in mind that none of this would work if we did not nationalize the Federal Reserve. The tax cuts proposed above would be suicidal under our current debt-based monetary system. But if we nationalize the Fed, we really could do this. It may sound crazy, but it really would work.

#4 If we nationalize the Federal Reserve, there would be no more budget deficits. If the federal government was a bit short one year, it would just print up a little bit of extra money in order to make up the difference.

It would also be very important to cap federal government spending as a percentage of GDP so that we don’t have crazy Congress critters creating a lot of inflation by spending us into oblivion.

Just because we would be adopting a debt-free monetary system does not mean that we could throw spending discipline out the window. Rather, it would actually become more important than ever.

#5 If we nationalize the Federal Reserve, we would instantly reduce the national debt by 1.6 trillion dollars. That is the amount that is currently on the balance sheet of the Federal Reserve. The Federal Reserve just created this money out of thin air anyway, so it was never their money to begin with. Some members of Congress have already proposed cancelling the debt held by the Federal Reserve, and it is a great idea.

#6 If we nationalize the Federal Reserve, we could eventually get rid of the entire national debt.

Under our current system, the U.S. national debt will never, ever be paid off. We are 15 trillion dollars in debt, and at this point we add more than a trillion dollars to that number every year.

As I have written about previously, if the federal government began right at this moment to repay the U.S. national debt at a rate of one dollar per second, it would take over 440,000 years to pay off the national debt.

But under our current system we are not paying it off. Rather we keep piling up more debt at an astounding pace.

In a system of debt-free money, there would be no more budget deficits, and we could actually start slowly paying off the national debt with newly issued “United States money”.

This would have to be done very slowly so as to not shock the financial system, but it could be done. As U.S. debt becomes due, a small percentage of it could be retired each year.

It is entirely conceivable that within 30 to 40 years we could pay it off entirely without causing tremendous damage to the financial system.

#7 If we nationalize the Federal Reserve, we will eventually totally eliminate the interest on the national debt. Most Americans don’t understand this, but each year we spend hundreds of billions of dollars just on interest on the national debt. For example, the U.S. government spent over 454 billion dollars on interest on the national debt during fiscal year 2011.

Under a debt-free monetary system, that number would eventually go to zero. That would save the federal government a ton of money.

#8 While there is certainly a danger that we would have inflation under a debt-free monetary system, the reality is that we are absolutely guaranteed inflation under the Federal Reserve system.

Most Americans believe that inflation is a fact of life, but the sad truth is that the United States has only had a major, ongoing problem with inflation since the Federal Reserve was created back in 1913.

If you do not believe this, just check out this chart.

Sadly, the U.S. dollar has lost well over 95 percent of its value since the Federal Reserve was created.

So, yes, there would be a need for monetary discipline under a debt-free monetary system, but it would be hard to do worse than the Federal Reserve has already been doing.

#9 If we nationalize the Federal Reserve, we would eliminate all of the financial bubbles that the Federal Reserve has been creating.

For example, there would not have been such a bad housing crash if the Federal Reserve had not created such perfect conditions for a housing bubble in the first place.

We should eliminate the Federal Reserve and allow the market to set interest rates. Having a central authority that sets interest rates is just simply wrong and it creates all sorts of problems.

#10 The Federal Reserve has not been doing a good job.

In case anyone has not noticed, Federal Reserve Chairman Ben Bernanke has a very long track record of incompetence. Nearly every major judgment that he has made since taking over that position has been dead wrong.

We are always told that we need someone to run the economy and that the Fed is there to keep depressions from happening.

Well, the truth is that the Fed actually greatly contributed to the Great Depression and it was at least partly responsible for the financial crash of 2008.

Now we are right on the verge of yet another massive financial implosion.

If someone keeps wrecking your car, you don’t let them keep driving it, do you?

#11 If we nationalize the Federal Reserve, we could potentially transition to “sound money” at some point.

There is great debate about this of course. But it is a debate that we need to have.

But before we go to “hard money” we need to do something about this horrific debt that we have piled up for future generations first. We simply cannot lock this debt in and expect them to pay for our mistakes.

We made this mess, so we need to clean it up.

Going to a debt-free monetary system would allow us to do that.

#12 If we nationalize the Federal Reserve, our local banks will have much more freedom. Most Americans simply do not understand just how much power the Federal Reserve actually has over our local banks.

For example, just last year Federal Reserve officials walked into one bank in Oklahoma and demanded that they take down all the Bible verses and all the Christmas buttons that the bank had been displaying.

#13 If we nationalize the Federal Reserve, we won’t have trillions of dollars of secret loans being made to big financial institutions on Wall Street and in foreign countries.

Most Americans don’t realize this, but the Federal Reserve made $16.1 trillion in secret loans to their friends during the last financial crisis.

Meanwhile, hundreds of small banks were left out in the cold and the American people got no help.

This is rampant corruption and it needs to be stopped.

#14 The Federal Reserve needs to be nationalized because it is an unelected, unaccountable “fourth branch of government” that has gotten completely and totally out of control. Even some members of Congress are now openly complaining about how much power the Fed has. For example, Ron Paul told MSNBC last year that he believes that the Federal Reserve is now more powerful than Congress…..

“The regulations should be on the Federal Reserve. We should have transparency of the Federal Reserve. They can create trillions of dollars to bail out their friends, and we don’t even have any transparency of this. They’re more powerful than the Congress.”

To learn much more about the Federal Reserve and how it is destroying prosperity in America, there is a great animated documentary on YouTube entitled “The American Dream” that you can watch right here.

It is absolutely imperative that the American people get educated about the Federal Reserve and about why a debt-based monetary system is bad for us.

In 1922, Henry Ford wrote the following….

“The people must be helped to think naturally about money. They must be told what it is, and what makes it money, and what are the possible tricks of the present system which put nations and peoples under control of the few.”

The U.S. government does not need to go into debt to anyone.

The U.S. government is a sovereign nation.

So why in the world are we 15 trillion dollars in debt?

We have allowed ourselves to become willingly enslaved.

In the book of Proverbs, it tells us the following….

The rich ruleth over the poor, and the borrower is servant to the lender.

By allowing ourselves to become enslaved to debt, we have become the servants of the international banking system.

Our founding fathers attempted to warn us about this.

For example, Thomas Jefferson strongly believed that when the federal government borrows money in one generation which must be paid back by future generations it is equivalent to stealing….

And I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.

Not only that, Thomas Jefferson also once stated that if he could add just one more amendment to the U.S. Constitution it would be a ban on all government borrowing….

I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of the administration of our government to the genuine principles of its Constitution; I mean an additional article, taking from the federal government the power of borrowing.

If we had implemented that advice, how much better off would we be today?

We can still do this.

We can take back control of our financial system.

We can nationalize the Federal Reserve.

We can dramatically cut taxes and eventually shut down the IRS.

We can give our children and grandchildren a future that is debt free.

We can escape the tyranny of the international bankers.

The choice, America, is up to you.

The Economic Collapse

This video says it all.  Every single American needs to understand this right NOW:

The glory of debt spending and casino financial markets.  What is the typical income, tax situation, and household income for Americans?  Americans claiming student loan deduction surges from 4 million to 10 million in roughly one decade.  According to IRS AGI needs to be above $1 million to qualify for top one percent.

This weekend I spent time digging through IRS and Social Security data to get a better perspective on working and middle class Americans.  I find it amazing that in a consumer driven economy, meaning we live to spend in some respect that the media never even bothers to focus on household incomes.  Even on self branded “business” programs with fancy watermarks which tout their major expertise on knowing about Americans they fail to do any analysis on income.  Need we even point out their missing of the biggest economic recession in our recent history?  This silence as you know is purposeful.  The media is largely beholden to advertisers and it might be perceived as a downer to tell the public how far back they have gone in the last decade on the income treadmill.  It is understandable although not acceptable that large television outlets do not discuss wages and income but what about the respectable press?  Where is there voice?  Either way, as we dig into the data it is understandable why so few even bother to cover this unsavory topic.

Tax return data by income levels

First, let us gather a glimpse of actual household tax filing information:

Source:  IRS

With all the discussion about the 99 percent I think you have many people that are largely off on what they assume is the one percent.  The media is largely to blame and I have even seen business outlets interview people that claim to make $100,000 and are afraid of being taxed because they are in the one percent.  Uh, not exactly.

Let us examine the data:

66 percent of tax returns show an adjusted gross income of $50,000 or less

31 percent of tax returns show an adjusted gross income between $50,000 and $100,000

So with these two groups, you are covering 97 percent of all households.  Now keep in mind we are looking at adjusted gross income so actual wages will be higher, but not by much.

“So what does it take to be in the top one percent?  You will need an adjusted gross income of $1,000,000 or more.”

Even folks with an AGI between $200,000 and $500,000 don’t fall in this category.  Of course Wall Street investment bankers want to make people believe that even with a $100,000 household income that somehow if investment banks were regulated that they will lose their entire life savings (this is actually already happening with housing and the casino known as Wall Street).

Let us dig deeper into the tax data.

Read the rest at My Budget 360