Hebrews 12:1-2

"..let us run with perseverance the race marked out for us. Let us fix our eyes on Jesus, the author and perfecter of our faith..." - Hebrews 12:1-2

Wednesday, January 26, 2011

The State of the Union 2011

As is my annual ritual, I read through the President's State of the Union Address this morning. I haven't read or listened to any political commentary at this point, so my perspective is untainted and solely my own.

There are several portions of the speech that I could draw attention to, but I will choose only two.
Here's the first:
And if we truly care about our deficit, we simply can’t afford a permanent extension of the tax cuts for the wealthiest 2 percent of Americans. (Applause.) Before we take money away from our schools or scholarships away from our students, we should ask millionaires to give up their tax break. It’s not a matter of punishing their success. It’s about promoting America’s success. (Applause.)
In fact, the best thing we could do on taxes for all Americans is to simplify the individual tax code. (Applause.) This will be a tough job, but members of both parties have expressed an interest in doing this, and I am prepared to join them. (Applause.)
Okay, where to start. If you truly care about the deficit, you will stop spending more than you have. Period. This isn't rocket science. Don't spend what you don't have. That means that you can't create new government institutions, agencies, positions and programs until you have funded existing programs. Since the existing programs were running a deficit when the President took office, he should have reigned in spending and reduced the size of the Federal government. But he didn't. He increased its size and scope and buried the nation under a crushing amount of debt that will cripple us in the coming years if the tough decisions aren't made.

The idea of sacrificing for the good if the nation is noble and all, but when the government doesn't choose to adopt the same strategy, one has to question the motivation behind this course of action. America's success isn't going to be determined by whether or not the wealthiest Americans are taxed higher. Her success will be determined by how well the Federal government allows the American people to innovate, create and prosper - including financially. When you tax the wealthiest people at an ever-increasing rate, what do you suppose the final outcome of that will be? Inevitably, the wealthy people find the loopholes, reinvest their finances in other places, or they simply move to a place that will not tax them so heavily.

I'm all for simplifying the tax code. What currently exists is so convoluted and complex that even the government institution chartered to enforce those regulations (the IRS) is having trouble keeping up.Contrary to what the President and members of the government believe, this is a fairly simple goal to accomplish. It's called a flat tax. The amount of paperwork and hassle that such a system would remove from businesses is huge. The reduction in size of the Federal government, by way of drastically reducing the size of the IRS, would be sizable. While I am open to the idea of reducing and removing large portions of the existing to tax code as a preliminary step, I cannot see how this type of effort would prove worthwhile over the course of time. Every year there are additions to the tax code. I am of the opinion that a flat tax would work and would allow the citizens and companies of this great land to prosper. The only way this would work is if the government is held accountable and sticks to a non-deficit increasing budget. (That's sounds a lot like common sense, doesn't it. Some might even say it's Constitutional.)

[Feel free to insert a rant about the Federal Reserve's ability to print an unlimited amount of currency here.]

Here's the second portion that I want to draw attention to:
And because the American people deserve to know that special interests aren’t larding up legislation with pet projects, both parties in Congress should know this:  If a bill comes to my desk with earmarks inside, I will veto it.  I will veto it.  (Applause.)
Let's see how long it takes to break this promise. I cannot imagine the President being able to stick to this. Now perhaps the senators and Congressman will find another way to tack on their pet projects, or call them by a different name, but I just don't see this being a line in the sand that the President is unwilling to withdraw from.

Overall, the speech read like most of the State of the Union speeches. Obviously, I cannot speak to the effectiveness of the President's delivery of these words, nor to the receptiveness of the blended-party crowd. I am sure there is plenty being said about all that extraneous stuff anyway. If I find anything worth linking to or pointing out as I read more and hear more today, I will add it to the bottom of this post.

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