Over the years, as the United States has been slipping further and further down the slippery slope of deficit spending. And also while we were racking up debt at an unbelievable rate, there has been much talk about how to get it under control.
Of course many conservatives such as myself believe, the first step is to stop electing liberal Democrats and Republicans.
Any discussion about the economy, debt, and deficit spending, will end up coming around to taxes. Should we cut taxes and spending as most conservative will tell you. In doing so we allow the people to keep more of their money and spend it, and in so doing actually stimulate the economy. This would then raise tax revenues. But due to the historic level of debt and deficit, we would have to cut spending in order to allow the economy and the government machine to find its level.
Now on the other side of the discussion you have the liberal mind-set that you can keep spending tax dollars to stimulate the economy, while raising taxes to balance the budget. Doesn’t work, never will. As the government steals the money from the pockets of the working people, there is less money for the people to spend within the economy. Also as the working people are taxed to the point of personal failure, the tax burden actually creates more people who become dependent on the government. This increases the amount of government spending. This is what creates the huge deficit. When this happens the liberal will not decide to spend less, oh no! What the liberal will do is either print more money or borrow on the world market. But always the liberal will demand that we spend more.
Printing more money only devalues the dollar. Borrowing, as we have seen only makes us beholden to countries that do not have our best interest at heart, such as China.
Let me say that I don’t believe that Democrats and liberals are stupid. I do think they are wrong in their approach on how to solve our economic troubles. The tax and spend will not work. Borrowing from countries such as China has put us at risk of complete failure.
Yet we are still seeing Democrats and liberals trying to convince us that if we just raise the taxes a little more we can pull ourselves out of this mess. Think of yourself standing at the bottom of a pool in concrete shoes. Now think of someone trying to convince you, that if they just put a little more water in the pool, then you will float to the top. Just hold your breath until you do.
That seems to be the perception that Delaware’s senior Senator, Tom Carper has. He seems to think that if we raise the fuel tax twenty-five cents, that we can suddenly solve the problems we are having in maintaining and repairing our roads and infrastructure. But let’s look at the bigger picture. What will that twenty fiver cents really end up being?
I believe that any additional energy tax, be it on gasoline or the production of electricity, will be nothing but a hidden value added tax or VAT. The idea of a VAT has been tried and failed in Europe. The VAT is a tax that is imposed upon every step in producing a product, be it a car or a pencil. Each step of production has another tax levied. The lead for the pencil is sold to the pencil factory and is taxed. The rubber for the eraser is taxed, the wood for the barrel is taxed. The finished product is taxed. And all of this tax is included within the price of the pencil.
Now let us look at Mr. Carper’s idea of a twenty-five cent increase on the fuel tax. Every business that hauls their product on the highways will pay this tax. When the company that hauls the lead for the pencil buys fuel, they will pay the tax. When the company that hauls the rubber for the eraser buys fuel, they will pay the tax. The company hauling the wood for the barrel of the pencil, buying fuel, will pay this tax. All of these companies will pass along the increase in fuel cost to the company producing the pencils. This company will then pass along the increase to the consumer, and don’t forget that the company selling the pencils will pay the higher fuel tax, the stores that buy in large quantity and then ship to their individual store will pay the higher tax also. Again all of this will be passed onto the consumer.
In the end what is being sold as just a twenty-five cent fuel tax increase, will end up being a hidden sales tax. Every product produced and transported will incur a higher cost of production and transportation, and like all taxes and cost of doing business, it is the consumer that ends up paying the tax.
So when you hear Sen. Carper and I’m sure Sen. Coons saying that it’s just twenty-five cents and won’t add up to all that much when you fill your cars. Remember, you won’t just be paying it when you fill your cars. You will be paying it when you buy your food, when you buy your TVs, when you buy your clothes and yes when you buy your pencils.
But hey! Its only twenty-five cents, right?