Communism: Why it only works on paper!

Surely, everyone knows who Alexandria Ocasio-Cortez is by now. I’m gonna call her AOC because her name is ridiculously long.  Just like Bernie Sanders before her, AOC is making communism/socialism great again. (Side note: One too many shitty politician slogans in this intro lol) As if communism/socialism ever was great. But seriously, this joke of congress representative comes from the Bronx. (I sure as hell didn’t vote for her.) AOC seems to think and talk a lot. In fact, I think she talks too much. Let’s be honest her ideas aren’t the brightest. I digress but AOC is an easy target. What I really want to discuss the philosophy that she is trying (and failing) to push as the new way forward.

Before I start ripping AOC recent comment about how being morally right trumps being factually wrong, let me explain why communism/socialism is great on paper. I am going to totally ignore the facts, totally ignore the realities. In a literally ideal world, communism/socialism would function very smoothly. In the ideal communist society, there would be no classes. There would be no private property. There would be peace and love. Complete zen. Everyone would be workers who own the factories. There wouldn’t be anyone higher than anyone else. The shared responsibility for society’s success would fall on the shoulders of the great proletariat. In a similar and not so distant ideal world, socialism would be law of the land. The benevolent government would run social programs from healthcare to welfare. The government would nurture each man, woman, and child. The people would humbly pay taxes and gladly contribute more than their fair share. (Well OK, not gladly because if you don’t pay taxes you go to jail) Everyone would be so happy in these similarly ideal worlds.

Just keep dreaming… don’t these two forms of economic and ruling systems sound amazing?  Are Bernie Sanders and AOC on to something? NOPE.

I’m sorry to jar you from your wonderful dream, but there are realities that even most ardent communist or socialist can’t reckon to go away. Yes AOC, it doesn’t matter if your morally right, the facts are always right. I’ll be the first to admit that capitalism is not a moral system. In fact, there are no MORAL systems. You can argue whatever you want but trust me, in the end, someone always gets fucked.

Let’s start with the problems of communism:

Responsibility, Greed, self-interest, corruption, logic.

These are just some of the words, that could used to describe the problems with communism. I feel like I’m beating a dead horse because its clear that communist don’t understand simple political theory. Humans are naturally greedy and self interested when it comes to being political actors. Humans are very predictable. Any psychologist would tell you this. Communism doesn’t work because there will ALWAYS be a few greedy, corrupt and self interested individuals who take advantage of the system. You may have heard of Mao Zedong. Mao was a smart guy that decided that China should have communism and took advantage. Mao lived fabulously meanwhile upwards of 60 million Chinese died or more. My point is that communism is inherently flawed. You may ask why responsibility is on this list? Well, have you ever had a roommate who doesn’t wash the dishes? (If not, then you might be that guy) Communism assumes that all your roommates are going to wash their dishes and clean up. But the reality of communism is that only one or two roommates do anything. In some cases, maybe you all just do nothing. There is no motivation to do anything, because you don’t own or get anything for your work.

Now for socialism, its basically same case except one difference. Imagine, have a boss or manager like from work in your life all the time. And imagine, your paycheck also pays part of their paycheck. Just imagine being watched and monitor in everything you do. No privacy. That is socialism with similar problems to communism like lack of motivation to work, no responsibility for self, and still boat loads of corruption.

You may think now is the time where I lecture you about how great capitalism is. But unfortunately, capitalism is just an economic system. Capitalism can work with a dictator or democracy. It actually doesn’t matter.

My point is that communism doesn’t work in real life. Neither does socialism. On paper, they sound really amazing. I really wish that people would do just a little google search on the pros-cons of these systems. I find it really hard to understand how people can just flaccidly accept Bernie Sanders or AOC’s proclamations about socialism as morally right. Putting everything else aside, I think they are wrong to assume that any economic system is morally right. The facts don’t lie. The facts don’t support anything like socialism or communism as being a viable economic system. I mean yes, for a short time they work but they end up failing. Mankind needs a long sustaining system not just some short term system that just puts years behind from where we are currently.

I don’t have all the answers but I know for sure that if we keep heading down the road to socialism/communism, its not end in a wonderful dream….

Thanks for reading, Comrades!

Minds: gpslife12

Social Media Censorship: Supreme Court Case

I was browsing Minds and came across an article that caught my eye. I heard about this case a few months ago. The case is about Social Media censorship. Here is the link to that article. The article just explains the case. Unless you have been living under a rock then you are probably aware that the likes of facebook, twitter, google, youtube, and others are censoring speech that they find disagreeable. The majority of the victims are conservative leaning or libertarian leaning pages. The great purges of these types of pages has been happening for the better part of 4 years since before the 2016 election. My long held belief is that speech shouldn’t be censored in any way, shape or form unless its actual hate speech or harassment. A quick google search could tell which supreme court cases outline what defines both hate speech and harassment. This case is potentially huge.

The setup of the case as the article explains is about two employees who made controversial or undesirable comments about a private network operator. This situation is not uncommon in everyday life, as Facebook will often suspend libertarian voices for their opinions which aren’t approved by the social media overlords. There a few legitimate questions that we have to ask about this case in order to figure out how the court might rule. We also have to consider that first amendment as current protects citizens from government censorship in a variety of speech capacities such symbolism and in writing. Keep this mind because I believe this wording could be critical for an expanded first amendment.

Let’s first consider that right now private companies are exempt from first amendment. In a private entity, a company or organization can censor speech because there is no government involved. It makes sense, that private company has an image to protect among other public relations duties. Second, lets consider that public entities like schools must follow the first amendment and protect the free speech of its students. More accurately, public high-schools, not state or private universities. This case isn’t an about what is considered free speech or not, its about whether a privately operated company that controls a public domain that is usually free can censor speech on that network. This definition or description could apply to many of the social media giants. Keep this all in mind.

Now, here is what I think the Supreme Court should rule in this case. In this case, I don’t think that Manhattan Community Access Corp receives  government money, however many companies do receive government money in some way. We know that google and facebook are both technically government contractors who receive money to do government spying and other projects. In addition to the fact that they operating public domains which consumers don’t directly pay for. I think the court should consider that government contractors are an extension of the government. (I have no idea of the current rules about free speech placed on government contractors because most of which are military production and research)

The reason why I believe that the court should rule in favor of the plaintiffs, is because of the same reason why public high-schools are force to allow student’s first amendment rights. Public schools receive government money thereby an extension of government. The Supreme Court has precedent to back this up. This decision if they make it could even affect universities who do receive government via student loans, and state schools are also funded by the government. Just imagine when  your liberal college professor has to let you talk freely about how much you love Trump… It makes me feel warm and fuzzy inside.

Now will the Supreme Court actually take it this far? The answer is no, probably not. However, it would be step in the right direction for them to rule that private operators of public networks can’t censor speech because  of the same rules that apply to public high-schools. Coming back to government censorship, the social media giants (Especially google, facebook, twitter) almost all receive government, which makes them extensions of the government therefore subject to allow free speech.

I can’t be sure of what the lawyers will argue or how the judges who are mostly conservative will look at the case. For me, I am always for free speech even if it means that communists and socialists can spew their vile economic policies and garbage they believe. It is their right to do in person and on social media. The same goes for neo-Nazis they should be allowed to express their white supremacy views as long as they don’t harass or threaten others. We need to get out of this PC-world where words are considered as dangerous as guns. Words are just words. Actions speak louder.

I will be keeping an eye on this case. I know its been awhile since I have blogged. Probably will be awhile longer until I do it again. Just been really busy with life.

Stay Awesome and see you next time!

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History Less Traveled: A New Series

This blog has been very political lately, its because I really enjoy writing about politics. My other passion in writing is about history. I’ve had this idea for awhile to do a series on history not often taught in schools. Let me just define schools, I’m talking about grades Kindergarten through 12th grade. I’m sure when you think back to your schooling experience in the subject of history, you think “oh it was very boring, total snooze fest”. This opinion is not uncommon. I know exactly why people say that about history class. The problem with History classes in grade school is that the subject matter and teaching focuses narrowly on what the test is on. In addition, curriculum focuses on dates, names and places rather than cause and effect or storytelling. I want tell you a thing about me that you should probably because my angle on this particular issue is backed by actual life experiences.

Almost a History Teacher

That’s right I got within about 3 months of being an actual high school history teacher. So I understand the curriculum and whats involved pretty well. I also understand especially for New York State what kind of exams they give for history. I specialized in US History but I’m good with global history too. In my student teaching, lets just say it wasn’t my lack of subject knowledge that failed me. (It was social aspects and other things, a whole other story) This information should tell you a lot about me and my views of history. I absolutely love it. I’m fairly well read on most American History. In this series, I want to take either one specific topic or a grouping of events and discuss them in terms that the average might understand them. I want to make them interesting more importantly. I would try to relate them to now. In my opinion, I think that history needs to be related to current events. History isn’t new, history doesn’t occur in a vacuum, history flows and events happen in an order sometimes at the same time. Timing of history is as important if not more than the actual dates and names. Timing is a part of the story.

History Shouldn’t Be Only Memorization

I keep emphasizing that history is not just dates, names and places. I keep saying that it should story with cause and effect. The reason is because I personally don’t memorize names, dates or places. I remember history in chunks. Let’s take the lead up to the Civil War for example, does it really matter if you know who was President before Lincoln? (James Buchanan)  It honestly doesn’t matter whether or not you could recall that. To me, the more important thing is what factors lead to the civil war? What were the causes? Research has shown that there is a few causes but the main two being slavery and state rights. A good historian always asks who, what, where, when, why and how? This is called 5 W’s method. Let’s take slavery to see why it was cause of the civil war. The north was slowly freeing their slaves, meanwhile the south was dependent on them for the cotton production. The slaves were also a divisive issue because each new state mattered whether or not it was free or a slave state. If there was more free states it would threaten the slave owning south because they outlaw slavery. If there was more slave states it would insure slaves stayed. This is also the context of regional tension especially between northern and southern states.

I think of the most interesting things about slavery is the economic impact of it on the southern economy. Slavery actually keep many poor white farmers out of work because the free labor undermine the supply and demand of market. When the South seceded from the Union it faced international backlash for still owning slaves. Once again another interesting aspect of slavery was the foreign policy of the Confederacy. The failed attempts to gain allies in Europe was due to the fact that European states like Britain and France had done away with slavery nearly 50 years earlier. This is just a little taste of how I remember history, and all of this story about slavery adds even bigger picture of why the Confederacy lost the war despite superior generals, the economic disadvantage to the far more industrialized North Union was a large reason for defeat.

Topics to Survey 

I think my point about how to learn and remember history is clear. I literally did no research prior to writing that. All from my memory. I want to make this a long running series with many posts. I’m thinking because I tend to write A LOT when I do history writing that I would break it up in shorter pieces for easy digestion and reading purposes. Now you can drop me a line at garrett_smith12@yahoo.com if you have a topic you would like to see covered, just make sure to be specific since broad topics tend to be harder to do. But I was thinking I would do a few genocides. You might be thinking that kinda of morbid isn’t it? Yes, however genocides are rarely cover in US History. Even more disturbing is the amount of genocides in American history that aren’t really taught correctly if at all. Some genocides like the Native American one that was perpetrated starting from Christopher Columbus all the way until the mid 20th century is basically ignored or just left out. Other genocides like the Ramadan genocide are just ignored also because  typically history class only cover up the Korean War. This actually marks another set of topics I could do. The Cold War often isn’t covered in history classes and typically anything from 1990 forward is just totally ignored. Again there is a wealth of topics so I’ll probably start with ones I know best and slowly research ones that I don’t know as well. I’m going to try to bring in actual primary and secondary sources if possible with citations.

History Less Traveled

As you can tell this post is already very long and its just an introduction of sorts. (haha) So be on the look out for posts with History Less Traveled in the title because it will be part of the series. I hope you are looking forward to this series as much as I am. I think most of the fun for me will be the actual process of writing it. If you do enjoy this series or other posts on this blog, I’d appreciate if you share it with your friends or whoever you think may like it!

Have a great day!

Minds @gpslife12

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Bordertarians: Wall Worshipers

Cue the #BuildtheWall chants and Pepe memes because we’re going to be discussing walls at length. In all seriousness though, this post is centered around borders as they are enforced by the State. Of course, a wall is now the preferred method of protecting such a border. Now this particular article is not aimed at those conservatives (Statists) who support having such a wall. This article is aimed directly at those “libertarians’ who justify a state enforced border because they don’t understand it or don’t believe that society can exist without it. Also these people label themselves as “Libertarians” because they don’t believe in the government doing anything else except that border. Hence the name “Bordertarians”, which I will refer to them as.

Pro and Cons of Borders 

Obviously, I am going acknowledge that borders have at least one pro but it has nothing to do with the State. They make a good organizational structure in which to view world. Borders do have their place within the context of individual’s property rights which I will get to later. The cons of borders are many, you can see it right here in America. People will cross them illegally. The border is expensive to maintain, with border patrol agents, surveillance, and potentially walls.  The border can also create a lot of unnecessary violence especially when trying to enforce it.  Yes, some of these cons do exist even without the State being involved, its just the nature of a border.

Cognitive Dissonance: Give meLiberty or Give me Walls.

My biggest problem with bordertarians is that they won’t admit to being closeted Republicans at worst, at best they are minarchists. Hear me out: It doesn’t matter what your other beliefs are, but if you justify anything with state backed laws or power then you aren’t really a libertarian. The same goes for borders. I’m not saying you have be totally against borders. You have to be against STATE enforced borders. This is what many bordertarians fail to grasp is that anything the STATE enforces is a form of statistism. That being said there is a way to be for borders without the state which I’ll get to in a second. The other issue often brought up with borders and walls is that of the welfare state. Some bordertarians advocate that cutting the welfare state would fix the border problems. Obviously, not handing out free money is a good start. However, typically people will flock to a prosperous economic country with jobs. As you can imagine, a country without a welfare state probably has a decent economy or at least it should in theory because otherwise everyone is dying. My point is that the state should always be eliminated in every aspect and facet of society.

Private Property: Real Borders 

Now let me discuss an acceptable form of borders which all true libertarians should support. Bordertarians justify the state to enforce imaginary borders that have no real backing behind them. The real case for borders is via private property. Individuals have the right to own property which is including but not limited to themselves, land, other possessions. This means that individuals have “borders” and in this case  it means natural rights. The individual’s property is their natural rights. Other individuals should not and cannot violate the “borders” or natural rights of other individuals. These are the only borders that libertarians support.

Conclusion: Just the Tip: NOT EVEN ONCE

The point of this post is to say that support of anything state enforce is not true libertarianism because the whole point is to reduce government to nothing. We can’t keep giving the government MORE responsibility it can’t handle. Let’s face it, the government does a poor job of handling the border. There are 11 million illegal immigrants in the country and counting. The problem is that government would rather illegals come here than actually help the one’s that do the process legally. Its very frustrating to see because of many of the legal immigrants are harder working than Americans. We don’t need state enforced borders, we need private property rights and the right to defend it. That will work better than any state run border.

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Part 2: Monetary policy and Trump’s Tariff debacle

Before you start reading this post you should go to part 1 if you aren’t familiar with supply/demand curve and “dead weight loss”. 

In the first part of this post, I will be discussing Trump’s tariff debacle. It is a little misleading but enacting tariffs can only end in a debacle. In today’s world, we have globalization and free trade around the world. The world is much too interconnected to put protectionists policies in place is like moving backwards. I want to re-highlight these points even though I mentioned them in my other tariffs post here.  In the second part of this post, I will go over one or maybe two common monetary policies utilized by the Federal Reserve (Central Bank). The policies will be in relation to tariffs because they have to do with the actual money supply. I won’t go too far into detail, lets get right to Trump.

Globalization and Free Trade are the New Norm:

If you haven’t read the tariff post linked above then here is a brief recap about globalization and free trade. Globalization is spread of goods, people and cultures all over the world. In today’s world, if you look at how the internet let’s people access information instantly, and how you can literally go anywhere by plane, boat or car. This is globalization. The exchanging of information with people from all over world, it has us more interconnected than anytime in human history!

This connection has lead multiple free trade agreements. There are many more pending. My point is that Trump cannot possibly ignore this. Trump’s problem is, as I see it, he is thinking like the US is his business. So in order to get his business (USA) ahead he wants to cut off the competitors by pricing them out. However, there is a YUGE problem! The problem is that consumer markets are now worldwide. The USA has a population of only 320 million out of 7 billion people in the world! Clearly, the US is lucrative market but its not the only one!

Protectionism: Moving the Economy backwards:

This is painfully simple to explain. The US used to be a protectionist economy from its birth in 1776 to about 1913. The federal government collect the majority of its income from tariffs on imports and exports. In 1913, the federal income tax  started raking in more than tariffs. It has ever since. After the world wars, the world started to rapidly globalize. The US lead the way. Now the US is in a tedious position with countries like China chopping at the bit to take first place. The point is that if the US wants to go back to pre-1913, before we were considered the world’s number one economy then we should enact tariffs. Speaking of China, that brings me to my next point.

Trump will eventually lose the trade war with China:

Recently I was able to acquire membership to the Wall Street Journal. (I got connections, kidding) I came across an article that caught my eye. Let me preface it with this: Trump has already approved 50 billion dollars worth of tariffs on Chinese goods. Now Trump is threatening to raise it to 100 billion dollars worth. The Chinese have responded that they will fight back if he does it. Here is the link to the article, its called Trump Weighs Tariffs on $100 Billion More of Chinese Goods by Bob Davis. (I believe they allow a few free reads if you haven’t gotten a subscription) Davis goes into detail about the possible effects of the tariffs. He also writes about Trump’s possible plans to protect industries like agriculture. I would encourage everyone to read since it gives a decent background on the situation.

My point here is that Trump cannot win against China. The Chinese hold a ton of our debt. In other words, they buy American dollar backed government bonds. (China also cheats on its exchange rate by basing it off these debt bonds) China holds leverage because of the holding of American debt and they import more to us than we export to them. Trump will lose because China doesn’t need US goods. The US is more dependent on China. Now you can how monetary policy plays a role in the contexts of tariffs and the economy.

Exchange Rate

One of the most important aspects that any government can control is the exchange rate. The exchange rate or currency exchange rate is the value of one currency in relation to another. For example: 1 US dollar is equal to .81 Euro. Currency exchanges can done in every currency. One of the ways that the exchange rate help with Trump’s trade war is through making our money more valuable or less valuable. Unfortunately, its a great tactic because it can backfire. In a circumstance, where Trump decides to have the US Treasury take money out of the money supply or circulation. A common used is called deflation. Which refers to increase of purchasing power of money.  This usually helps everyone because less money is worth more. However, in regard to China, it would probably strengthen the Chinese position.

make the dollar worth less, it would help devalue the debt held by the Chinese. Trump would simply tell the US Treasury to print more money. However, the drawback is that it would cost more to pay back debt. It would also decrease the buying power affecting nearly everyone except the super rich. Its also called Inflation which is my next topic.

Inflation

Inflation is often seen as a bad word. Its often used to describe the fall of prices and purchasing power. There is some controversy about how its calculating using CPI or Consumer Price Index, which is explained here. Now the important thing about inflation is that it can have serious consequences.  One consequence I mentioned was decreased purchasing power. Purchasing power is very important especially everyday people like me and you. Many of my anti-minimum wage arguments on center on this exact principle. Having money be worth less means that you have work harder to make more to buy less. For example, inflation might bring your regular grocery bill from 100 dollars  a week to 150 dollars a week even if the prices of food remain about the same. The reason is because each dollar may lose 10 cents in value. (The math is a little complex)

What does inflation mean for Trump’s trade war? There is good and bad news. The good news is that Trump could try to deflate the value of the Chinese held US debt. The consequences would be as mentioned above. This method would disallow the Chinese to sell off the debt without losing value. The bad news is that even if the Chinese are forced to keep it, America would have a harder time paying it back. Trump also has to be careful not to print too much money.  The problems that arise can be dangerous for the domestic economy. Money circulation works in a supply and demand curve. If the value of money is too high or too valuable than one can print more bills to help lower it. This is rarely a problem, except when considering exchange rates, imports and exports. If the value of money is too low than one could take money of the supply to help increase its value. So really its a supply/ value curve.

To conclude: Trump’s Trade War is not easily winnable. He obviously has some tools to work with. I also read recently that he is rethinking the Transpacific Trade partnership or TPP. I think its interesting because if the countries currently in the agreement allow Trump re-join and set the rules for trade than it will the US control over trade especially in regard to China. The TPP is a trade agreement that actually just regulates trade in certain industries. Trump withdrew because of global warming clauses and “unfair” regulations.

I can write more on TPP soon because I find it interesting. Also a Syrian Bombing post is coming soon.

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Part 1: Economics 101: Supply and Demand are Essential

I talk about politics and history on my blog quite a bit. These are my absolute favorite topics. I have in past posts talked about economics but it tends to be boring. One of my goals when starting this blog was to educate. So in this post, I intend to educate about some economic policies that relatively misunderstood by the general population. I won’t jump into the hardest concept first because in economics similar to math and science you have to understand the basics. First I want to talk about supply and demand. I know that I have talked about it before. Then I want to move into monetary policy. I might even touch on tariffs which I explained here. It occurred to me that President Trump’s recent tariffs have confused many people. You may or may not realize that tariffs can have very serious effects on our economy. They can also affect how other countries treat us. More on these topics later.

Supply and Demand: How it works?

You might be familiar with a chart that looks like this. (Above) The way to read the chart is simple. First, you have to recognize a basic principle in economics that I call “push and pull”. Its very similar to Issac Newton’s “For every action there is a reaction” because for each transaction or movement of money or just action there is a reaction that also involves a transaction or movement of money.  Therefore if we look at the orange line labeled as supply and the purple line labeled as demand, you can see horizontal axis is labeled Quantity (increasing from left to right). The vertical axis is labeled Price which is increasing from up to down.

To put it simply:

As the supply goes up, the demand goes down. (Price and Quantity go up as well)

As the demand goes up, the supply goes down. (Price and Quantity go down as well)

This chart is the basis for literally everything in economics. Nearly everything can be put into terms of supply and demand. I will give a simple example of how supply and demand works:

Let’s say you own a winery in Napa Valley, California. Let’s say you have two main competitors that are approximately the same size winery as you. All three wineries make similar profits, have similar expenses and locations.

The going-market value for a 750ml bottle of wine is 25 dollars.

Your company price: 27 dollars, Competitor A: 27 dollars, Competitor B: 27 dollars

So right now every company is above value meaning that supply is meeting demand. Every company is able to charge more because of a high demand. Now Let’s say there is a massive drought. Shortage of grapes. Now you and your competitors can’t make as much wine. What do you think happens to the price?

Your company price: 30 dollars, Competitor A: 31 dollars, Competitor B: 32.

If you said that the price will increase because the supply has been depressed while the demand remained the same then you would be correct. Now let’s say the drought is over but a study comes out that says wine is bad for mental health. Suddenly everyone stops buying wine. What happens to your prices?

Your company price: 23 dollars, Competitor A: 20, Competitor B: 23 dollars.

If you said prices will decrease because of the drop in demand and the excess supply of wine then you would be correct. This is a very simplistic example and obviously running a winery is more complicated than I presented. I think that the concept is clear. For every action there is a reaction. For every push there is a pull.

I hope you got supply and demand down pat, because we are going to use it to help explain why President Trump’s tariffs are not as great as they sound. If you want to check out my post on tariffs then click here. In this next section, I will be focusing specifically on the economics.

The “Dead-weight” Tariffs– Tariffs in the context of supply and demand.

If you went to read my tariff post then you’ll have some idea what I’m about to explain here. For the purpose of this section, I’m going to assume you just learned about supply and demand. Let me explain that tariffs are a tax on an import or export (In this case President Trump is putting tariffs on imports) Tariffs actually used to be the US government’s biggest source of income up until the turn of the 20th century. The US approved an (16th) amendment to constitution that made income tax the primary source of government income. Now a days, tariffs only make up about 1-2 percent of income for the government.

An import is a good or product that is shipped or brought into the country. An export is a good or product that is shipped out or sold outside of the country. It’s good to know these terms. Let’s take a look at another chart, this represents tariffs on the supply and demand curve:

It may look confusing but it’s actually really simple. Keep in mind that as the supply goes up, the demand goes down. (Price and Quantity go up as well) Also as the demand goes up, the supply goes down. (Price and Quantity go down as well) Now if we at look chart let’s take the green line into account first. The green line is labeled “Supplier’s share of tax”. In order to explain the green line, I will give a brief example:

So let’s say there is a Steel Maker company and a Railroad Tie company. The Steel Company makes the steel that is needed for the Railroad Tie company. There is also a third foreign steel company located in China. So pre-tariff on the import of steel, the cost of steel for the Railroad company is .50 cents per pound from the foreign steel company. The Steel Maker company located in America has a price of .60 cents per pound. The green line represents that .50 cents that the Railroad company currently buys it steel at.

Now lets look at the red line labeled Customer’s share of tax. Back to our example: President Trump has imposed a 15 cent per pound tariff on imported Steel from China. (Not real, just made it up)  How does this affect our three companies? First let me give one key detail: Railroad company sells rail ties for 25 dollars per tie. So here is the breakdown of before and after the tariff

Company:                    Pre-Tariff Price              Post Tariff Price              Net Change

Railroad company Ties      25 dollars                       30 dollars                   5 dollars

USA Steel Company:           .60 cents                         .60 cents                      No change

China Foreign Steel Co.     .50 cents                          .65 cents                     15 cents

What happened? Well the Railroad company rose it price by 5 dollars. They also switch suppliers since they don’t want to pay more than they have to for steel.  Now refer back to the chart. The distance from the green to red line is known as “dead-weight”. In the chart, the blue triangle in the middle represents the dead-weight. Remember that “customer value” represents the demand side. Also that the green and red lines both represent supply both before and after the tariff is applied. The term dead weight refers the money lost due to the tariff. The Railroad company had to pass its extra cost of 10 cents to its customers. The reason?  The tariff made the foreign steel more expensive, however the American made steel did not get any cheaper so therefore the Railroad company had to pass that 10 cent per pound difference to the customer.  Of course, depending on the well-being of the company it could have also led to job-cuts or reduction assets.

Conclusion:

To recap: Tariffs create dead-weight whereby the tax increases the cheaper foreign competitor above the already more expensive domestic price. The unnatural increase creates a dead-weight because instead of natural competition, the tariff forces  a company to spend more without getting any benefits.

I’m end it here because they will be a part 2. In Part 2 we will finish up with a discussion of President Trump’s policies and the impact it will have with China. Then I will continue to explain some monetary economics that are important to understand.

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Lesson on Economics: Protectionist vs. Free Trade

I know. I know. I know what your probably saying to yourself. “Not another economics lesson, you nerd!” “Haven’t you already covered everything economics?” Thank you, I am a nerd and also yes I’m thorough in my coverage of topics. I promise I’ll try to not to drone on for 2000 words this time. I need to explain something that President Trump has recently brought up as a potential policy. I don’t think people really understand how import and export tariffs work.

On the surface, in simplest terms a tariff doesn’t sound like a bad thing. A tariff is a tax on a imported or exported good. A tariff can increase of the price of a foreign good to make the domestic goods more “competitive”. Now I put that quotes because the reality is quite different. I think most people would say that there seems to be nothing wrong that. History would even agree that tariffs are a commonly used tool by governments to help guide trading between nations. Here is the problem.

Tariffs are antiquated. The US government used tariffs from its inception thanks to Alexander Hamilton’s brilliant mind to about 1913. After 1913 and in the 105 years since tariffs have fallen out of favor as economic tool. This isn’t to say that no country uses them but the US government only takes about 1-2 percent of its income from tariffs today. Before 1913, the tariff brought in nearly 90 percent of the governments income at its peak.

Economists agree that tariffs hurt an economy. I’ll get to why after I explain that globalization and free trade have changed the world economy. Globalization is the free movement of people, cultural and products. The world is more accessible than ever, with cheap flights to almost anywhere in the world. The internet has an untold wealth of information that was never available til about 25 years ago. We live in a world where everyone is connected. There are multiple free trade agreements between countries that allow a flow of goods and services between them. Free Trade encourages competition in the market. It allows every participant country’s economy to benefit.

Meanwhile, Protectionist economies or countries that use tariffs extensively are actually hinder. The simple explanation through some graphs and pictures. 

This graph is basically a supply and demand curve with some with other lines. (Charts reads likes this: As supply goes up, Demand goes down OR As demand goes up, supply goes down). The bold line is the price of goods before the tariff on imports, its label WS. The line above that labeled WS+ Tariff is price of imports after the tariff.  The implication is obvious: A tariff will increase price of an imported good. Here is another chart to show the impact of this:

This particular chart shows the “Dead weight” or loss of value. This chart reads like this: As quantity goes up, the price goes down.  You can see the supplier has to pay the tariff and therefore it increase the cost to the customer. The loss of value is where the maker increases the price of their product to cover the cost of the tariff. The money is lost because the supplier has to either stick with that supplier or go to another one which obvious wasn’t cheaper before the tariff.

Here’s an example:

Before Tariff:

Company A: Product cost: 25 dollars

Foreign Supplier 1: Material cost: 5 dollars

Domestic Supplier 2 Material cost: 13 dollars

After Tariff:

Company A: Product cost: $25+ $10 tariff = $35

Foreign Supplier 1: Material Cost: $5 + $10 tariff = 15 dollars

Domestic Supplier 2: Material Cost: 13 dollars (No added Tariff)

You can see the dead weight  or loss value. The tariff raises the price of the foreign competitor’s material cost artificially. The extra 10 dollars that it cost to buy from that foreign supplier is lost. This is because the domestic supplier’s cost is 13 dollars compared to the foreign supplier’s 5 dollars before tax. The loss of value is 8 dollars. Therefore the Company A has to raise it prices because its cost have increased.

I’ll put a picture in the preview that help explain even more. (Credit to marketbusinessnews.com)

My conclusion is basically that protectionist policies don’t benefit an economy in the long run. The government is once again interfering in the market where it doesn’t need to be. As usual, the best solution to fix the problem with tariffs is to not have any. We have to take the government out of the market that includes all varies regulations that just raise prices and don’t involve health and safety.

President Trump should tread carefully because the long term implications will be worse than the short term benefits. I think that because of globalization, free trade is the new way to do business. Although the US has historically been a protectionist country, the future is going the exact opposite way. The world economy has undergone globalization and free trade is the new normal.

Thanks for reading, if you are still awake feel free to check out:

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Have an awesome day!

Relevant articles on Tariffs,  Historical Tariffs, Economics Part 1, Part 2, Part 3

Tragedy of the Commons: Problem with Collective Policies

Have you ever heard of Tragedy of the Commons? Sound familiar? Tragedy of commons is typically associated with fishing. If fisherman go out to a popular fishing spot and catch fish at a rate that is more than fish reproduce, then that would be a tragedy of commons. Garrett Hardin came up with theory originally and applied it to biology or nature. There are many examples, but the basic principle is that demand overwhelms supply.  Just in case you fell asleep in Economics 101 or you happen to be Bernie Sanders then here is a little reminder of how supply and demand work:

I want to talk about tragedy of the commons in the terms of political policies and platforms. It’s a topic that is hotly contested among Libertarians and conservatives. On the other hand, Liberals tend to completely ignore it. Its this ignorance of the tragedy of commons that might explain why collectivist policies that liberals tend to advocate are just really bad. Liberals and even Conservatives both tend to argue for MORE government regulation in the face of a tragedy of the commons issue. (I’ll try to keep it relatively brief, one or two examples, I have a lot to say)

Let’s take on healthcare for example, is a tragedy of the commons. Liberals advocate for a universal healthcare system. This system would in theory depend on the taxpayer (theft) money to help cover the costs of healthcare. However, this policy would extremely expensive due to the increased costs to private health providers. Also the service given by providers would be slower due to a heavy volume and probably less staff. Healthcare is a complex issue but a tragedy of commons exists in both the taxation for it and the availability of quick medical care by providers. For example, in Canada, they have universal healthcare and experience longer wait times, sometimes for very important life saving procedures. In some cases they come to the US for faster care.

In short, universal healthcare is a collectivist policy pushed by liberals that creates many tragedy of the commons. Unfortunately the conservatives are not much better backing single payer with a government agency running the show. Less tragedy of the commons here, but still not the best option. The solution for a tragedy of the commons is deregulation in most cases, concerning government policies. In nature, like the fishing spot, the solution would be to have fisherman stop fishing in that particular spot until there were sufficient fish. I want to clarify what I mean by collectivist. Collectivist is a term usually meaning something is done in or by a group.

My second example is one of the hottest issues because of a vote coming up, Net Neutrality. Naturally my position is repeal because Net Neutrality isn’t consumer protections, its just dealing with bandwidth and if companies can block or censor stuff. From what I’ve read the new rules after repeal will be that the companies will have to report whatever they throttle, block, censor to the FCC who will make it public. I also see no problem with Netflix and Amazon and Hulu having to pay more for bandwidth. They use a lot of it, its only fair. Naturally that will be passed to the customer. However, the good news of repeal is that companies will offer different packages specifically geared toward streaming services. Unlike now, where you get all one price and it might be good or bad.

The tragedy of the commons in Net Neutrality stems from the issue of bandwidth. There is only so much bandwidth that these companies can generate without losing money. Its interesting because if you look at bandwidth in a vacuum, it really highlights the problem. Watch: Let’s say Comcast and Verizon both offer 300 mbps of bandwidth under current Net Neutrality for an average price of 150 dollars. (Making up random numbers here). Let’s repeal those rules and see how prices and amount of bandwidth change. Under Net Neutrality, both companies would have similar prices and the max amount of bandwidth would be at 300, but of course you can pay less to get less. The problem with this is that the companies aren’t really competing. There’s very little variation because the going rate for bandwidth is 150 dollars for 300 mpbs. Everyone can gets to use that bandwidth to watch Netflix and play fortnite as much as they want. The companies might be struggling to keep all this bandwidth up with only 150 dollars per customer because their own business costs are going up.

If we repeal Net Neutrality, now Comcast charges $100 for 200 mpbs,  $200 for 300 mpbs and lets say $300 for 400 mpbs. Unheard of right? Well, Verizon charges $75 for 150 mpbs, $150 for 250 mpbs, $275 for 300 mpbs, $350 for 420 mpbs. Now you can see the competition as each company tries attract more customers. They may even offer a lower bandwidth but you get extreme streaming capabilities for an extra 100 bucks. Either way, the competition will naturally drive down prices. When supply goes up, demand goes down. In order to create demand you need to supply, but you also need to create an interest in your product and attractiveness or marketing.

The solution to the tragedy of the commons for nearly every aspect of Net Neutrality is deregulation. Let the consumers decide which companies will succeed and fail. Another positive aspect of net neutrality being repealed is that it will allow startups and other smaller companies to get into the market of internet.

I believe that through my two examples I have shown why some collectivists policies are broken due to the tragedy of the commons. I believe that the solution to tragedy of the commons is deregulation which means getting government out of our lives. This solution is the basis for the whole libertarian philosophy. If society is a tragedy of the commons then as libertarians we are for the deregulation and privatization of pretty much everything. Everything is harder in a large group. Its similar to when you ask your friends where they want to eat. Everyone has different opinion. Or when you ask your friends when they want to go out. Everyone is busy and has no time. Collectivism requires group-think and group decision making. Its not the most effective. Tragedy of the commons also tends to tread on the rights of the individual.

The rights of individual are the most important aspect in a free society. As Thomas Jefferson once wrote:

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness”

Thanks for reading!

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What do you mean no Helicopters and McNukes?

In usual fashion I have come across some inspiring material to write my own article on. I’ve been thinking recently about what the ends of a libertarian party or movement would or should be. In this blog I consider the means of getting there. I’m always pushing steps toward a libertarian society. These steps seem to never make any progress. I have always viewed the libertarian society as an idealist notion. I think to some degree its true. On the other hand, I feel like its entirely possible that a libertarian society is achievable. The problems are numerous and the solutions are few. One main problem and probably the biggest one is the lack of education of outsiders on the libertarian values and beliefs. People tend to misinterpret or misunderstand what libertarians stand for and what we want to achieve.

I’ve recently said on social media that I believe I’m in the minority of libertarians that believe that achieving the ultimate goal of a libertarian society will come instantly once it happens. I feel that many libertarians, anarchists, anarcho-capitalists think that once we overthrow the current government then we can just easily transition to that libertarian society that we all agree is the goal. I don’t believe its so easy or fast. I think there is a number of factors to consider about means and ends of libertarianism.

The first and foremost is that the way to change the government is to vote for politicians who hold the same beliefs, values and morals as libertarians.  We can all agree politicians of this caliber don’t exist right now with the exception of Rand Paul, maybe. After voting for Gary Johnson in two consecutive elections I have realized that we are going too big. (Nothing wrong with him, just a walking meme.) We need to find libertarian congresspeople. I know of 3 libertarian leaning congresspeople, Rand Paul, Thomas Massie, and Justin Amash. Once we can turn the Congress into a majority of libertarians then we can work on the white house.

The second factor is education like I mentioned before. A lot of people have misconceptions of libertarians. Even I used to subscribe to these common myths. For example: Libertarians are both Republican and Democrat because they support a little of each. It might be true that we hold similar positions but we are actually against both parties. The two main parties are a snake with two heads. They don’t care about you. They care about their interests and their money! We need to educate the masses on libertarianism. The essential thing is liberty and freedom. The government shouldn’t play much if any role in our everyday lives. The government doesn’t need to over regulate and get involved in everything we do. The government doesn’t need to tax our hard earned income. For over 100 years, the US government collected no income tax. Who will build the roads? Private corporations that need to ship things by truck. Businesses that need to drive around. My point is that if we can educate people then eventually will lead to more people accepting and more importantly voting for libertarians.

The third factor of the means is simply cohesive-ness among libertarians. We have to unify our ideas. I know we all agree on certain things. But we have to compromise on other things. Example: Abortion. One of the hottest button issues because there is no stasis for argument. Pro Life or Pro Choice? For me, I’m torn between both because choice is guaranteed by the 14th amendment. Yet I’m also catholic so I can’t possibly support the killing of something that is alive. My position is Pro-Adoption. It gives a choice and saves the life of the baby. Also there are many parents out there who can’t have kids. My point here is that a compromise takes a little bit from each side and makes palatable to everyone. Compromise is something that our country was founded on. I strongly believe we should get back to that.

The forth factor is concerning the ends. I find it hilarious but helicopters and McNukes are a standard must have in any libertarian society. But lets all be honest its a little far fetched. I do believe that no taxes, open carry (guns), NAP and very small government are possible to have. I think we all have to be realistic about the ends. The ultimate goal is for everybody to live their life without the interference from government. But I think we miss the point that libertarian is also one of the most charitable types of societies. Its not fake charity like socialism and communism. In a libertarian society, you would give to the poor, give to the sick and give to government if you felt like it was worth it. Thats the wonderful thing about it, its your choice to give your money or not. Government is ineffective at helping people. But there is a million examples of where everyday people throw their support at something and get it done without government.

My conclusion is that we need to educate, vote, come together and be realistic about our ultimate goal of a libertarian society.  We can do it all once too. My inspiration was an article that basically said no more Libertarian party but we need a movement. In order to achieve a movement, we have to educate people on the benefits of joining this movement. We have to vote in politicians who reflect our positions. Its not going to be easy. The steps towards a libertarian society will be methodical. All I hope is that I see this libertarian society come to fruition before my time is up. I’m still young so I got hope.

Just remember kids, Taxation is Theft.

Thanks For Reading!

 

Hiatus Break: Audit The Federal Reserve

Have you ever gone shopping like at the grocery store or for clothes? Any time you go shopping at a place on multiple occasions you probably notice prices change over time. This could be due to any number of factors. I feel like at the grocery store most people have a certain amount of money they like to spend. I know that I do and even with clothes shopping, my wife and I usually set a limit. If you’ve ever felt like every year you go with that set budget you buy less stuff, then you have felt the effects of the federal reserve. So you have to ask yourself did prices go up or did the buying power of my money go down? The answer is probably a combination of both.

If you haven’t read the title or guessed yet this post is about auditing the federal reserve. Now many people have absolutely no clue what this is or what it does. The federal reserve is a private, central bank that regulates our monetary policy here in the US. It is not controlled by the US government. Although the President is able to appoint the Chairperson of the Fed and the other heads in 11 cities around the United States. All of the appointments have to be approved by Congress. This is the only role that the government plays.

The current Fed Chairperson is Janet Yellen whose term is up. This means Donald Trump has to appoint a new chairperson. His selection matters greatly for us. I don’t care who Trump picks but whoever it is, has a big responsibility.  The Federal Reserve controls interests rates, money circulation, debt, bonds,..etc. They tell the US mint how much money to print. They set the circulation levels of the denominations. Keep in mind they have a lot of power without much supervision.

So why Audit the Fed? Well, one of favorite Senators Rand Paul has been saying this for years. The problem with the federal reserve that Rand Paul and others see is that an institution with unlimited power that has no accountability to anyone is a dangerous institution. Do your own research but here something that I learned by reading up on this. Before the 2008 financial crisis the federal reserve not only SAW but actively IGNORED the housing market bubble. They literally just WROTE IT OFF like nothing. The Chairperson of the Federal Reserve at time, Ben Bernanke just flat out denied that it was nothing but aberration!

Then during the crisis they did nothing.  Just a quick reminder that everyone employed by the Federal Reserve is very smart most of them with Ph.Ds in economics. These so called “economic geniuses” failed to act in the face of major crisis that saw trillion of dollars lost and millions of families affected. People lost their houses, lost their retirement and their jobs. Did the Fed suffer any consequences? Nope. Somehow they are still allowed to function!

Auditing the federal reserve would mean accountability. We can’t let them devalue our money and ignore possible crises that could affect millions any longer! We need to hold these professional bank robbers accountable for their crimes against the USA. Auditing the Federal reserve is just the beginning. After we find that they have been fucking us over, we have to get rid of them. Ever since 1913, when the fed was established, we have been getting screwed over by their monetary policies.

Trust me, every day people like me and you are screwed by these pompous assholes. They devalue the dollar on purpose. They decrease your buying power. Why do you think that 30 years everything was cheaper? I can remember growing up and my parents both had steady jobs. Luckily they never got laid off or fired until this year. So we always had a steady income. The financial crisis hit. We went from shopping at Hannafords which isn’t super expensive but its pricey. We started shopping at Audi’s which is much cheaper in comparison. I didn’t realize it til later but the financial crisis drastically decrease my parents buying power. Thankfully we never starved.  But imagine the price paid by poorer families who could barely get by in the first place?

The federal reserve is an evil institution. It cannot be trust. We need to end the Federal Reserve. I hope whoever is picked as Chairperson agrees to an audit which will inevitably lead to ending the federal reserve. Thanks for reading. Please tell your friends and share this post. #EndtheFed #AudittheFed Let’s spread the word.

 

Hiatus Break: NFL Protests and Tax Reform

I have previous written about the original NFL protest by Colin Kaepernick. This post basically tells Kaepernick to put his money where his mouth is. He did exactly that. Now the protest has spread around the league. President Trump has tweeted, spoke and commented on the protest on multiple occasions. In apparent backlash, NFL ratings are down pretty significantly. The owners and players are seemingly at odds. (I’ll get into this more) I won’t just be talking about the NFL protest in this post. I also want to touch on tax reform which is currently the hot issue in Congress. I hold an extreme belief about taxes. I mean extreme by that its a position that isn’t possible in today’s circumstances. However, it doesn’t mean its not achievable eventually through some means. I will lay out my own set of tax reforms in the second part of this post.

I have been an NFL fan my whole life. Quite literally since I was in second grade I remember watching the Jets. I remember wearing Jets jerseys (I still have them). I absolutely love football. Although I never played in an organized manner. If I was athletically gifted I would be a Quarterback in the NFL. Generally I’m one of those people who doesn’t care to mix politics with anything but politics. So when Kaepernick started his protest I wasn’t that happy. Its not that I don’t care about the issues he is protesting or that I dislike him. Its just I watch football to watch football. I don’t care about the political leanings of the players or owners or coaches. Aside from that, they all get paid handsomely (Players) or are extremely wealthy to begin with (owners).

The problem with the protest now is that its gotten way out of control. At first it wasn’t too crazy. The craziest comes from a unlikely source in President Trump. Now Trump himself isn’t shy about creating controversy or saying incredibly inflammatory things. However, the President of the United States typically doesn’t pour gas on a fire like he did with the NFL protests. I basically have two issues here and the main issue is Trump’s position on this. Trump wants the owners and NFL to force the players to stand for the anthem. I think that many conservative thinking people probably agree. They think its disrespectful to the flag and the military. Which I don’t fully disagree.

However, the constitution has a bill of rights. In that bill of rights there is a first amendment. The first amendment is the freedom of speech. Over the years the Supreme Court has ruled that speech isn’t just talking, it can also cover symbolic speech and others. In this regard I have disagree with Trump, he or the government can’t make a law forcing them to stand. Its the players right to protest and there is nothing that Trump or the government can do. However, the NFL could do something like fire the players. But they won’t do that. Let me tell you why they won’t: Backlash would very bad for the NFL probably twice or three times as bad it is now. However, the NFL could force players to stand, its not a violation of first amendment rights. The reason is because the players represent the NFL as brand and the NFL has right to protect its brand from being unnecessarily tarnished especially by its own employees. The NFL also has a collective bargaining agreement which apparently does state that players must stand. If its true, then its over because the players agreed to that agreement and therefore would have to follow it or be fired.

In my opinion, I think that players should stand because of the ratings and money. I mean they are only affecting their own livelihood. If the owners still feeling the pinch then so will they. In the end, its better if they stand and try to protest in a different way or become an activist and use all those millions to do something about the problem. I don’t think anyone can deny that police oppression is real. However, I think the solution lies within criminal justice reform. I won’t get into this because I’m not an expert and I didn’t do any research yet. However, look out for future posts.

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Tax reform is one of my favorite topics to discuss. Its because they are a lot of solutions to a problem that seems to never go away. I think one thing that is always missing from the tax reform debate is spending reform. You might say that’s a totally different reform! But actually taxes are based projected government spending.  For example: the government spends approximately 600 to 700 billion dollars on the military each year. In order to cover that they need to raise that in taxes.

Generally the federal government’s budget is anywhere from 2 to 4 trillion dollars. It is supposed to be a certain percent of GDP or gross domestic product. (I have a post dedicated to this subject of GDP) So my ideal tax reform in a perfect world would zero taxes. You may have heard taxation is theft. If you haven’t then its pretty plain what that means. Yes the government is stealing from us. This is a very extreme way to view taxation but its not as crazy as you think.

Originally the US government didn’t really collect taxes. In fact, the US government taxed products and used tariffs up until about 1913. So our government was able to run entirely without any income tax. Income tax is now the largest category of revenue of the US government. Its also the worst way to fund the government. Income tax really sucks. There will never a true, fair way to split up the weight of paying it. Its awful. However, there is no way the government could survive with 20 trillion dollars of debt and absolutely no tax income. That insane.

My proposal is essentially this get rid of the current tax format. Install a universal basic income (See this post). Then install a flat tax starting around 15 percent. No more brackets. No more loopholes. My plan does a lot of things but the two main things is that it cuts spending and will eventually lower taxes! So with basic income it would cut out most of social welfare programs and replace it with a government check to everyone over 18 and not a criminal. This saves approximately 200 million dollars a year. Each year for about 10 years you fix or pay off the debt. Plus the 15 percent over ten years would generate enough income to really pay off the debt and run the country. After ten years you lower the tax rate to 10 percent for another 10 to 15 years. Essentially the goal is to make the government so lean that it won’t need tax money. Its definitely possible over time.

This a simplified version which I think is good start. The details and actual numbers would have to be worked out by someone in a math oriented field. I can only hope that this tax plan eventually happens. Its not a popular one because usually conservative politicians advocate flat taxes. Basic income isn’t too popular either because it sounds a little crazy. But I feel like the two very different approaches really balance each other out. Also you can’t possibly say a flat tax isn’t fair. Its fair by nature. Also it still ensures that the poor pay less and the rich pay more. Which is why I don’t understand why people don’t like it. I guess they would rather get fleeced by the current system.

Thank you for reading! Have a awesome day!

 

 

 

Hiatus Break: Big Picture Policies

Once again, I have been inspired to write. This time its because I witnessed a discussion in a class that I’m taking in college (Occupational Therapy Assistant is my major).  The class is a community health lecture. I expected to learn about health and how to be a healthcare professional.  Instead I got a lot of political statements that were pretty controversial. Given the fact that it was a health class and not politics 101 I kept my mouth shut. Trust me I was probably one of the few to feel that way.  I won’t even mention what was said but it got me thinking.

When people espouse political views and opinions do they actually think about the big picture? My personal belief is that most of time, people just have beliefs and views in a vacuum with no reference to the realities. I have studied history and politics for years and have learned to think about the reality before choosing to accept a certain view. A lot of times for me, I don’t know about anyone else, but I find myself objecting to the means of political policy not the ends. Typically political views and beliefs express the need for a positive outcome that everyone should want. However, I feel that most of time the means is either impossible, more destructive than helpful or just plain nonsense. I want to give a few examples of policies that express positive outcomes but the means of getting there is just not worth it.

Before I give my examples I want preface it with just a little explanation on my title. Big Picture Policies. I think the title is simple enough to understand because the words aren’t complex. But grasping the big picture of complex and difficult issues is very hard to do. It takes something they rarely teach kids anymore, critical thinking and logic. I know they say that they teach it but the reality is that kids are guided too much and aren’t allowed to have an original thought because education is all repetition and brainwashing. Fortunately, you can break it by studying things on your OWN. Self learning is very important. So when dealing in Big Picture Policies or BPP as I want to abbreviate it, you need to look the realities of your surroundings.

The realities of your surroundings is basically the effect that a policy has on other policies and people. For example, my first example is healthcare. Recently Bernie Sanders is back at again with a universal single payer healthcare system. (changes every week?) So Sanders supports this single payer medicare for all system. Now lets say he get his way and Congress (by some unholy miracle passes a friggin law!!! Unreal!) passes this single payer medicare for all. Obviously the outcome is positive for everyone because they get government subsidized healthcare. But what about the policies affected this legislation? Once again this sounds great in a vacuum but when you start looking around at your surroundings you can see the problems. One of the biggest policies affected is the US Federal budget. This new single payer healthcare cost billions even trillions of dollars. Recently, the national debt went above 20 trillion dollars! Massive debt is never a good thing. Another surrounding affect is the doctors, nurses and hospitals that have to deal with the changes in payments, patient frequency, and increased operational expenses.

Expanding medicare for all would also affect tax policy because the federal government doesn’t just have money they would need to raise taxes. Which directly affects everyone with a tax increase, rich or poor. So you could say it would even affect yourself. Unbelievably many people are just fine with these realities. I imagine they aren’t thinking too clearly about the consequences of massive national debt that is being bought up and held by our enemies and rivals as leverage over US interests.

Okay Garrett, so you made your point the realities are shitty but isn’t healthcare is a right? Glad you brought that up. Healthcare is in fact a privilege that you pay for. Let me explain like this: If you are doctor with a private practice, just imagine you drive a Mercedes Benz and live in a nice house in a gated community. One day the police and someone in need of medical care barge into your practice. The police tell you that this patient requires medical care. You oblige and say is it life threatening? They say no. So you ask for the potential patients health insurance or however they might pay. The patient refuses to give you any health insurance info or money. The police threat to take you to jail. Do you still help this patient? If you still help them would you continue to do for every patient? If you don’t help then its obvious that healthcare is privilege because taking care of patients might be your passion but its also your only source of income.

The point is that healthcare for everybody is achievable but you can’t force it. The government is not good at running things. (Country is a mess have you looked around? Veteran Affairs is government healthcare program and its horrible) I believe that good ideas don’t necessary need to be laws. One easy way of making healthcare for everybody is by decreasing the price. One of the best way to decrease prices is to let the consumers decide which service is the best for the money. This is called a free market system. Also natural competition creates lower prices because companies are competing for business. All it would take on the government’s side is the repeal everything and replacing it with just a few regulations to keep everything fair in terms of monopolies and consumer safety.

This is essentially how I look at every policy and judge it based on how it affects other policies. One of my favorite policies is Universal Basic Income. I did a whole post explaining how it might be implemented. Go read that first. Obviously UBI (Universal Basic Income) is a positive outcome for everyone because every citizen over 18 (non-felon) would receive a monthly stipend from the government. This policy over top of all other welfare programs would quite literally end America because of the massive amount money it would take. Things like inflation and lack of motivation would be huge problems. In my post, I revised it so that it could eliminate some of those problems.

One thing that I didn’t cover or even really think of in that post was inflation. I read something recently that made me go: oh shit! I think the easiest solution is to end the Federal Reserve. This would allow the government to stop printing money and readjust the interest rates and all that. To stop inflation created by UBI, basically no money could be printed and they would have take money out of circulation. By my calculations, the government would put about 500 billion dollars into the economy artificially so they would need remove 500 billion dollars from the currency circulating.

If you don’t know how inflation works then here is simple example: If you and five of your friends each have 5 dollars. You can all go to subway and buy a six inch sub of the day with your 5 dollars. Now lets say everybody gets an extra 2 dollars bringing each person total to 7 dollars. You all go to subway to buy that same exact sub which now instead of costing 5 dollars they raised it 8 dollars. So you can’t afford that sub. Inflation is devaluation of money. Essentially can it occur when minimum wage is raised, more money is printed than is backed up by gold or government bonds or when the government artificially stimulates the economy.  Now you may ask why did subway raise their price by 3 dollars? Well remember if everyone gets a two dollar raise then so do those subway workers. The cost of pretty much everything that is required to run that subway goes up, the workers are paid more so the ownership has to cover those costs. Usually its pass to the consumer because profits might be slim especially if his location has high renting cost.

Once again, this is a very simplistic example. Its much more complex than I explained. My point of this post is that when you espouse political views or beliefs try to think about the surrounding realities. Try to understand that policies don’t just have one positive outcome. You also understand that the negatives of policies might weigh more than the positives for some people. Its hard for people to understand but I’m for affordable healthcare, free college, and personal freedom on every level. However, I’m not a democrat or republican. I want all those things but I want them in a way that doesn’t hurt our future or present. Once you understand the realities and complexities you can come up with solutions to make dreams a reality. Unfortunately, the hardest part will be getting Congress to pass anything, so Good LUCK!

Thank you for reading! Have an awesome day!

Hiatus Break: Minimum Wage doing Maximum Damage

I’m baaaaaack.

I came upon some very interesting news on minimum wage. If you have ever read a post or scroll through this blog you can see that I love to talk about minimum wage. The reason why I discuss it so much is because its the best example of flawed economics and government policy. I know there is a lot juicy political controversies that I could write about but I actually wanted to talk about something important.

A few years ago in Seattle, Washington they decided it was a good idea to raise the minimum wage to 15 dollars an hour. Now personal sidebar note: I will be visiting Seattle this summer and I may even want to move there. I hear its a great city and place to live despite the government’s stupid economic policies. Anyway so its been a few years since Seattle raise its minimum wage to 15. What happened?

In an unsurprising twist of events to anyone knowledgeable in economics this study came out to find that the minimum wage ACTUALLY HURT LOW INCOME WORKERS!!!! WHAT A SHOCK! Here is the link to the study: https://www.washingtonpost.com/news/wonk/wp/2017/06/26/new-study-casts-doubt-on-whether-a-15-minimum-wage-really-helps-workers/?utm_term=.4ea73b51a9f7

Workers lost an average of 125 dollars a month! If you don’t think its big deal then you probably don’t understand how economics works. The explanation of this is pretty simple. In laymen terms: The government artificially increased the wages of the lowest income workers to 15 dollars. Therefore this decreased the value of money. For example if you had 100 workers, and you split them into 5 payment scales.

Scale of salary per 20 workers:

20 Workers make 10 dollars

20 Workers make 20 dollars

20 Workers make 30 dollars

20 Workers make 40 dollars

20 Workers make 50 dollars

Let’s imagine that the government raises minimum wage from 10 dollars to 30 dollars. This would decrease the value of all the workers buying power.  Now 60 workers would make 30 dollars. Because everyone makes at 30 dollars the buying power would decrease for everyone since employers would pass off the costs of raise to its consumers. Any time you raise the costs of doing business you raise the prices and that effectively eliminates any benefit of minimum wage.

You have to understand that buying power is more important than how much money you actually make. This is the point I’m trying to get across. People think that minimum wage lifts you out of poverty. But the reality is that because it sets the floor higher, it just decreases the value people who aren’t low wage workers. It also doesn’t help those low wage earners because the price of goods increase and so do taxes.

I believe the workers should make what they deserve. But I think that businesses and potentially employees are better fit to decide what their compensation is. For example, look at Starbucks. A few months ago they gave their employees a raise in wages by 5 percent. No government urging or anything. That is great. But then a few months later they raise their prices to off-set the cost of higher wages. That’s how it works with minimum wage too.

Honestly I could sit here and give a million examples of minimum wage failures. But to end this post I want talk about the Federal Reserve Bank. I recently read part of a book about the Fed (nickname for the Federal Reserve Bank; look it up).  The Fed controls and maintains the currency of the US. Its not well known how the Fed works or what exactly they do. However, because of their negligence in lowering the cost of money aka interest rates on borrowing money, they essentially caused the house crisis. They also devalued money over the past 20 or so years. The Fed is a purely evil organization, not created to be evil. But with great power comes great responsibility and corruption. The problem is that the Fed is not under the control of the government itself. However, it does work for the government (by printing money).

I really want go in a deep expose of the Federal Reserve Bank. I need to do some more research. I believe that if I can help educate people on this topic maybe we can end the fed and fix the damn money. Inflation and de-valuation of money is causing a ton of our problems today especially for normal everyday people. I’m sick of it.

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Hiatus: A New Path Forward

I want to write a short post because of some recent events in my life and changes to my schedule. I am going to take a Hiatus from writing this blog. No one else will be writing either. However, if I feel strongly about something and need to write it then I won’t hesitate. The reason for my hiatus is because a of my decision to return to college.

Yes, that is right. I will be returning to school. Unfortunately my previous education experience in History and Political Science has been useful for this blog but not an actual job. I have decided to take up Occupational Therapy (Pays quite well). Usually its abbreviated to OT or more specifically for me, when I graduate I will be a OTA or Occupational Therapy Assistant. I have applied to Laguardia Community College in Queens.

I started this blog to initially fill a void in my life because at time I was unemployed and now  I’m vastly underemployed. Now you might wonder why I’m stopping now when I haven’t been accepted yet? Well, the simple explanation is that I will be doing some pre-learning or self-taught learning. I have not taken a science class in about 6 years. One of the classes that is required for my coursework is Human Anatomy and Physiology. So in order to make time for my self taught learning, I need the time I typically spend writing blog post to do that.

When I get accepted and I do start to attend classes in September, then I will really be too busy to write. I really love this blog and will probably return to it once I receive my associates degree in Occupational Therapy Assistant. I also plan to make this blog even better when I return. I’m hoping to make an investment and upgrade to my own domain. Unitl that time comes, I will have sign off. If you have any ideas for blog posts (if I have time to write) or you want to write a post then feel free to contact me. (contact info on sidebar) I am still looking for contributors.

Thanks for reading! Wish me luck in my pursue of a new career!