Stop Pulling the Wagon

THE NEW MILLENNIAL GENERATION

Forgive me – This is a bit long but too important to shorten.

Young “Millennial’s” are widely reported to be fearful of their financial futures and blame the current and previous generations for the fiscal mess they are inheriting.  

They have a valid point.

Following the “Great Depression” and starting with the “New Deal”,  America has been on a spending spree, much of that on “borrowed from the future” money.  A sort of national credit card with no spending limit.  Some of it was caused by wars but most of it was greatly aggravated by a combination of the collateral costs of the Vietnam War and introduction of the “War on Poverty and The Great Society” in the 1960’s with its ever expanding  beaurocracy and growth of Government Social Programs  – aka – Big Daddy. 

In just the period between 2008-2016 our Government doubled the National Debt mostly through expenditures on Social Programs.

Our Government is now 22+ Trillion Dollars in debt with no way to pay for it except prohibitive taxation or through inflation, and if continued, hyper-inflation.  Government even pays the interest on the debt with more borrowed money.  Like paying your Visa Card with your Mastercard.

Fiscal discipline was thrown to the wind as Congress spent borrowed dollars to buy votes for election and re-election.  Modern day “Robber Baron’s”.

Over the last 50 years Government at all levels has become a sort of undisciplined, poorly managed, authoritarian, dis-organized criminal enterprise unable to manage any kind of reasonable budget. Taxing everything at every level and still unable to pay its own way.

Example: College Student loans were at one time made by local banks to students, usually with a parental guarantee of payment.  During the Obama Administration the Federal Government took over the Student Loan Program with Government funds and Government guarantees on a virtually unlimited basis.  

Colleges took advantage of this by raising costs.  The Government made these “New” Student loans “Secure” by demanding, in some cases, a near lifetime of payments and the condition that the loans cannot be discharged in Bankruptcy.  

Colleges and Administrators got rich and graduating students, (and in many cases “drop-out” students), found themselves poor with a mountain of debt and degrees in fields for which there are often no waiting jobs.  

Many of these young students would have been much better served with an  apprenticeship in such things as auto mechanics, building trades, Plumbers, Electricians, Carpenters etc., as well as “on the job” Business Management training for which there is a real world need at attractive wages.

In the process, taxpayers find themselves “on the hook” for 1 1/2 Trillion dollars in taxpayer money transferred to the nations colleges via student loans.

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“College debt is crushing an entire generation. Colleges are richer than ever. It’s a scam. Student loans are the biggest source of personal debt in the U.S..  Student debt crisis is impacting young American’s ability to thrive, purchase homes.”  …..Tucker Carlson Tweet and video –  5:35 PM – 19 Mar 2019

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College’s get rich  and too many students graduate to find there is no way to pay their loans and live in hyper-inflated housing looking for jobs that don’t pay enough for loan payments, housing and inflated living costs, so they end up “back home” angry and frustrated while College Administrators  are sipping Mai Tai’s at expensive resorts on bloated salaries which are paid for by Government Guaranteed Student Loans.

I don’t blame the Millennial’s for being very, very angry and feeling betrayed. 

Can this financial crisis be “fixed”? 

Some running for office are calling for College debt “forgiveness” which is just another word for Bankruptcy.  If Government does this what do we say to all those who worked hard and paid their own way through College?  What do we say to those who committed several years of their life to Military Service with the promise of College Tuition money?  What do we do about those who exhausted Unemployment Compensation and became “College Students” so the loan program would provide them with an income till they could find a job?  And, what do you say to those who have paid off their Student Loan debt?

Can this financial “mess” that our Government created and the Millennial’s are inheriting be fixed?   

I fear Government “Solutions”.  Government Solutions invariably lead to large expenditures of more deficit spending with the end result of making things worse. 

A day of accounting is inevitable and may be upon this generation. 

Would I be being too cynical to suggest that the Government intentionally created the Student Loan Program as a pipeline to channel too much money to  too many Colleges with too many Professors whose main agenda is teaching too many heavily indebted, now angry voters to hate America as it was founded and exists today?  

Bob Bandy 

April 2019

Rule#3 – Increase debt to unsustainable levels. This will allow Government to increase taxes, produce more poverty and further control the people.   Saul Alinsky – How to Create a Socialist State – Rules 4 Radicals

I hear on the news that serious consideration is being given to transporting some or all of the illegal immigrants currently flooding across our Southern Border to Sanctuary Cities across the United States to wait out their court dates six months or more in the future.  This possibility is raising quite a “Ruckus”.

I published the below article under the title of  “Welcome Mat” almost five years ago in June of 2014 as a piece of Political Satire regarding our U.S./Mexico Border Crisis in the news at that time. 

The original article is still on this site, just type Welcome Mat in the search window and hit “enter”…..  but it is reprinted in full below.

I reprint it here because apparently someone else has taken my idea a bit more seriously than I did in my “spoof” five years ago.  

I do find it interesting that those advocating for Sanctuary Cities and States appear to have a “NIMBY” (Not In My Back Yard) attitude when faced with the possibility of thousands of illegal immigrants being relocated to their own neighborhoods.  They are referring to the plan as “Dumping”.   Do I smell hypocrisy?

What have the Clowns, Criminals & Lunatics in Congress done to solve this problem in the last five years?

Bob Bandy

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June 28, 2014

WELCOME MAT

We see and are told in the news that we have a border crisis with tens of thousands of undocumented, would be immigrants flooding across our southern borders.  

On a serious note, I do not know anyone who is not moved by the sight of thousands of seemingly parent-less young children or ragged adults trying to escape poverty and even danger.  But, do we solve this by opening our borders to “all comers”?  Do we turn our Border Patrol agents into a kind of “Welcome Wagon”?  Do we just open all our borders on all sides to anyone and everyone from all countries around the world?  Can we just shut down the Department of Immigration and Naturalization?  

The Federal Government, State Governments and Congress are in a battle as to how to solve this crisis.  Some shouting to “Seal Our Borders” and others saying to welcome them all and create a “Path To Citizenship” for all comers whether legal applicants or those without papers.

I see a simple solution that should make everyone happy.  Lets send them where they are needed and wanted.

For example, Detroit, Michigan (pictured above) is a city that has lost tens (hundreds?) of thousands of citizens.  There are thousands of empty homes available either free or almost free for the taking.  And, Detroit has a long history of generous benefits to those in need.

Why not load these folks desiring to immigrate onto buses and take them to Detroit? On arrival they could be given a sack lunch and a map with directions (in their native language) to the offices of “Public Assistance” as well as street guides to areas where there is housing ready for the taking.

This program could be expanded to other cities that have by way of public pronouncements, ordinances and local laws indicated support for undocumented immigrants.  Some of the cities that come quickly to mind are San Francisco, New York, Chicago and Seattle but there are many others.

I have visions of caravans of buses with thousands of happy new, undocumented citizens streaming off the buses into the waiting arms of cities anxiously welcoming them with public funded programs to provide them with all the goods and services they need or want.

With my plan, the cities that have indicated they want them, get them and, get to pay for the services provided from their own local tax revenues.

Everybody wins.  What could possibly go wrong?

Bob Bandy

Original Story by Paul Galdone

Bob’s version of the Little Red Hen

ONCE UPON A TIME there was a little red hen who wanted to start her own oil company.

Who will help me find the oil she asked? Not us said the Federal Government!  Not us said the State Government!  Okay, said the Little Red Hen.  I will find it myself, and she did.

Who will help me get the oil out of the ground she asked? Not us said the Federal Government!  Not us said the State Government!  Okay, said the Little Red Hen.  So she did it herself.

Who will help me get the oil to the refinery? Not us said the Federal Government!  Not us said the State Government!  Okay, said the Little Red Hen.  I will transport it myself, and she did.

Who will help me refine the oil into gasoline she asked? Not us said the Federal Government!  Not us said the State Government!  Okay, said the Little Red Hen, I’ll do it by myself.  And she did.

Who will help me transport the gasoline to the Service Station she asked?  Not us said the Federal Government!  Not us said the State Government!  Okay, said the Little Red Hen, I will haul it there myself.

Finally the Little Red Hen’s gasoline is sold.

Who would like to share in the profits she asked?  

We would said the Federal Government and we demand 18.4 cents per gallon.

We would said California State Government and we demand 58.3 cents per gallon.

Looking in her pocketbook the Little Red Hen found that she only made a net profit of 7 cents per gallon.  (source Forbes & Factcheck)

Later, Federal Government and California State Government notified the Little Red Hen that since she was so greedy they were going to tax her income for the excessive profits she had made.  

7 cents a gallon profit.  Those darn oil companies sure are greedy aren’t they!

You can’t make this stuff up.

Bob Bandy

PROLOGUE

My wife and I love and are very proud of our daughter.  She always did well in grade school.  She was in the top of her classes in both High School and College.  Worked and paid her own way through College and graduated with a degree in her career field and money in the bank.

Following college she got a job in her chosen field and is well established on her career path.  She likes what she does, who she works with and the city she works in.  She is liked and respected by her co-workers and on a secure path in her employment.  She has a good paying job with benefits.

BUT IN CALIFORNIA

A wonderful daughter and model citizen who has done everything right cannot find a place to live that she can afford in the city where she works.  A one bedroom apartment is $1500 a month plus utilities.

Why is housing so expensive and scarce in California?  In a word, Government at all levels.

Many years ago California voters passed a ballot initiative titled Proposition 13 to stabilize and limit government property tax increases to 1% a year.  In other words they could not increase your properties tax value base more than 1% a year as long as you lived in your home no matter what happened to property values in your neighborhood.

If you sold your home or did a major add-on you could trigger a revaluation process.  Otherwise you were protected by Proposition 13 from property tax increases of more than 1% a year by greedy government. 

City, County and State Government in California have an endless thirst for more revenue.  If they can’t raise property taxes more than 1% a year they must find other ways.  Fees and assessments are one route they have taken.  Both are just tax increases with an identity crises.

Now many (all?) cities/counties have raised the fees for a Building Permit, associated fees and assessments.  If you want to read a fee schedule for one city go to:

  https://www.cityofranchocordova.org/home/showdocument?id=13958 

This is a 79 page document with a “laundry list” of fees for new construction.  You need to read the whole “book” to see all the various assessments/fees added to the basic original “Permit” fee.

I don’t have information on all cities/counties but, based on information I have received from reliable sources,  the “average”  for “new”  Building Permit and Property Development fees that use to average about 65 cents per square foot have risen to an average of about Ten Dollars and 65 cents per square foot. 

Using these numbers as an example:  You want to build a 1,500 square foot house.  With patio, walkway, driveway and garage you are “building/developing” a total of 3,000 square feet.   Based on the old rate of 65 cents a square foot,  the Building Permit Fee would have cost you $1,950.  Under the new fee structure that same permit now costs you $31,950.  This is before you turn over the first shovelful of dirt or drive the first nail.  That raises the cost of building your house by $30,000 in this example.  

If a developer wants to put in a housing, condo or apartment complex that increase in cost has to be passed on to the buyer.  

This is one of the reasons you see so many new housing developments  with two story houses built on tiny lots almost touching each other and having little or no front or back yards.  The added per square foot fee cost raises the cost of construction and the final price of the house, condo or apartment.  Hence, $1500 per month rent on a one bedroom  apartment.

This added on cost of building now raises your property value for tax purposes and lets government tax you on that additional $30,000 they charged you for “permission to build” on a “forever” basis as Property Tax.  To put it another way you are now paying property taxes year after year on a Government Fee!   The perfect End-Around tax hike.

It also forces up property values for existing houses and creates additional tax “opportunities” for government to collect even more property taxes as “value inflated” properties are sold on the market.  Government “wins” again.  Even as more and more citizens find they cannot find affordable housing.

Another reason for high housing costs is the demands put on builders to meet ever new and changing requirements for housing.  Many are desirable but expensive.  For example:  Solar panels will soon  (or may now) be required on new construction which can quickly add $20,000 to the cost of a house and its property value tax base.   

I remember many years ago in California, when property taxes  included Police and Fire Protection, schools, street maintenance, water and sewer service plus “garbage” service.  Now many of these are separate billed services or assessments on your annual property tax bill.  Those earlier days are long gone.

The above described Government greed for revenue is one of the reasons that housing is un-affordable in California and we see “tent cities” springing up in our cities and along our roads.  

“If God had not wanted them shorn, He would not have made them sheep.”  –  The Bandit Calvera – The Magnificent Seven – United Artists 1960

Bob Bandy

Mad Max Beyond Thunderdome

(Warner Bros. 1985)

As I am writing this the country of Venezuela is in chaotic economic collapse with government troops confronted by angry and desperate mobs of hungry people in the streets.  Stories are coming out of the country of people eating their own pets and long lines for a loaf of bread that now costs a huge pile of the hyper-inflated, devalued currency – when bread is even available.

Venezuela was a country with huge oil reserves, rich in natural resources and a vibrant hospitable people.

How did this happen and could it happen here in America?

In short, what happened was Hugo Chavez and his promise of a Socialist Paradise.

Nationalization and/or Government control of many/most productive industries and destruction of the “middle class”.  Affiliation with Communist Cuba and the Soviet Union.  Alienation from the United States and eventually most of the more moderate countries in Central and South America.

Once inflation, followed by hyper-inflation set in, what has followed was assured.

COULD THIS HAPPEN IN AMERICA?

Lets see how we are doing.

As of Feb. 11, 2019 the total U.S. Public Debt was $22,012,840,891,685.32

Source:  U.S. Government site:  https://treasurydirect.gov/NP/debt/current

America is now over 22 Trillion Dollars in debt.   According to public reports the Treasury Department is in the process of “borrowing” another 800 Billion Dollars for the balance of this year

Just the yearly interest on this debt is $364 Billion Dollars.  With projected annual interest by 2028 of  $761 Billion.

Source: https://www.thebalance.com/interest-on-the-national-debt-4119024

If the above numbers do not frighten you, they should.  The government does not even have the money in current funding to pay the interest on the debt.  So they borrow money to pay interest and keep on spending.  “Creative Accounting”.

Our Nations Debt has more than doubled in the last 10 years!

If the debt continues to grow, and I doubt there is the discipline in our country to stop it from growing, at some point in the not too distant future, just the interest on the debt could exceed current annual Federal Tax revenues.  

The word “unsustainable” is one of those words that we hear but the full potential impact of the word does not really register in the minds of the average citizen.  And if confronted with it most folks don’t want to deal with it. The effect can be catastrophic.  

While individuals, corporations, even cities can file for Bankruptcy, the Federal Government cannot.  The only option they have is to print money.   That means inflation and often leads to hyper-inflation.  From the Romans to Post World War I Germany to Zimbabwe to happening right now in Venezuela, governments throughout history have tried to use inflation to escape debt.

I don’t see a solution on a national scale.  So much of government spending is on “auto-pilot” with built in increases year by year.  There is no desire or will to slash spending on a government level and if such a plan were put forth it would have no chance whatever to pass congress.

Just my opinion based on observation but I believe as individual citizens we need to make plans for survival for ourselves and those we care about if the wheels come off the Government Wagon.  A word to the wise.

Bob Bandy

With the opening of the new Congress and change to Democratic control of the House of Representatives we are hearing renewed calls for “Medicare For All” residents of the United States.  This has become a rallying cry for the “Progressive” wing of the Democratic Party.  Not all Democrats are admitted “Progressives” but  a growing number appear to be.

“Progressive” is a kinder and gentler word for “Socialist” and some champions for this cause readily admit to Socialist leanings.  Socialist is in turn, often associated with the Union of Soviet Socialist Republics/Russia  and other Socialist countries like Venezuela, Cuba and many others.

If you would like an example of living in a Socialist Country, you might want to vacation in Venezuela this year.  Make it soon.  The country is in “end stage” Economic Collapse.

“Medicare For All” has a nice “ring” to it and on the surface would appear to be a way to provide Universal Medical Care to everyone on a simplified, single payer basis.  The idea sounds simple enough to be attractive.

A similar proposal was studied under Bill Clinton’s Presidency with Hillary Clinton heading up a task force to work out a plan for implementation.  After much study and spending millions of dollars on the proposed idea it was ultimately determined to be unworkable.

Several studies have been done and reported in Bloomberg and other  outlets that place the estimated cost of such a proposed plan at between 32 Trillion and 42 Trillion Dollars over 10 years.  That’s about 3.2 Trillion to 4.2 Trillion Dollars a year and would approximately double current Federal Spending.

It should be noted that Medicare as it currently operates is on the road to Bankruptcy.  Government Trustees, including Treasury Secretary Steven Mnuchin, Labor Secretary Alex Acosta, and Health and Human Services Secretary Alex Azar,  issued a report that Medicare’s trust fund will run out in 2026 and the combined trust funds of Social Security will run out in 2034.  Source: The Washington Examiner – Saturday January 26, 2019 – from a report by Joseph Lawler June 05, 2018.

Many people believe that Medicare is “Free” healthcare for Senior Citizens.  It is not.  Medicare is not free.  Premiums for Medicare are based in part on income – visit: MyMedicare.Gov – but if I take myself as an example, I’m a pretty ordinary Senior on a modest income, the following shows my Medicare Medical Insurance  and Medicare Prescription Plan monthly premiums for this year.  Keep in mind that plan premiums are for each individual.  Mine total just a bit over $300 a month this year.  If on a “Medicare For All” plan and I was one of a family of five, we could be paying a total premium of $1,500 a month.  

Please keep in mind also that Medicare Medical Insurance does not cover everything and has co-pays, deductibles and maximums.  The same for the Medicare Prescription Drug Plan.  When your limits run out during the year and, “you” are “on your own” for the cost of care or prescriptions for the rest of that year, is where we Seniors get the phrase “Donut Hole”.  I hit my own “Donut Hole” last year on my Medicare Prescription Drug Plan in October.

For the tens of millions of citizens who might not want to be a part of “Medicare For All” and are happy with their current insurance, don’t worry, “If you like your Doctor and Insurance, you can keep them, and that’s a promise!”  Hmmm – Where did we hear that before?

I am sure that Congress, most government employees and various other “special interests” would find a way to exempt themselves just as they did from the “Affordable Care Act”.  Hardly “Medicare For All”.  “All” never seems to include our “Ruling Class”.

For Senior Citizens the premium is withheld from our Social Security payment.  What would the Government do to collect premiums from those who don’t have a check to withhold the premium from, or those who don’t work for a paycheck?  What about those who can’t or won’t pay?

What would happen to the cost of care?  Are there enough doctors to make the plan work?  Not all doctors are currently willing to accept Medicare patients.   There are many unanswered questions. 

In the news and something to think about.

Bob Bandy