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The Selfish Left



http://thetheoryofmediocrity.blogspot.com/
The ego maniac and narcissistic
generation are taking over our nation. These Left leaning individuals are
selfish. There is no better way to describe these lazy deadbeats. Maybe they
are used to mommy and daddy giving them a gold star for every miniscule task
they performed, but it is becoming a glaring issue. It is not only that they
want free healthcare, free education, free welfare, and other free handouts –
they are demanding it at Occupy protests. They are so brain washed they are
willing to use force, violence, and even cheat to get what they selfishly think
belongs to them.




Unfortunately, liberal policy,
ideology, and rhetoric fuel this anger and lazy behavior that is becoming more
and more prevalent. This is the norm, and we are beginning the see the effects
of these dangerous beliefs in Europe. People who become accustomed to lush
retirement benefits, socialized healthcare, and other handouts are outraged
when these benefits are cut because the country can no longer afford them. So
who is the blame for this? The people living off the wealth of others, you know
those who elect not to work and to contribute nothing tangible to society
(carbon emitting oxygen thieves)? No! What about the government and those
special interests such as unions who agreed to and or passed unsustainable job
and retirement benefit packages? No! So who is the blame? Financial
institutions, Oil companies, and anyone wealthy – these responsible people are
to blame. These are the people to blame because they are not paying enough in
taxes and are not donating enough to charities. Is it really fair for someone
who collects food, housing, healthcare, and other subsidies to expect others to
pay 50%, 60%, or 70% of their wealth to support the lifestyles of others who refuse
to work? No, but that is how the selfish think. They believe they are not only
entitled to live off the wealth of others, it is their right! This is
absolutely crazy! After all, if it was not for the hard work of the top 1% there
would be no wealth to distribute for our present day handouts. If taxes were
increased on millionaires to 80%, within a year the masses would be demanding
to increase those taxes further. It is never enough for the selfish.





What are some of those selfish
leftist policies? The support of unions or any group which expects mutually
exclusive taxpayers to pay for their benefits. Any law or policy which forces
the distribution of wealth to citizens that are abusing these benefits –
ObamaCare, The Recovery Act, and extended unemployment benefits etc. How about
abortion? Any abortion that is not to protect the wellbeing of the mother, or
was not the result of a crime, is one of the most selfish acts a person can
commit. Attempting to recall Wisconsin governor, Scott Walker, was a selfish
act especially since the recall was due solely because of policy disagreement.





It is never ceases to amaze me how
weak and selfish people are becoming. Outside a select few people who pay their
way and or who put their lives on the line to protect our freedoms, the rest of
us are becoming a burden on society. Over 50% of Americans are on some sort of
welfare and in 15 years that number is expected to increase to over 68%. What’s
worse, it is projected that over 70% of Americans living today will take more
in handouts than what they will pay in the form of taxes (including Social
Security and Medicare). What happened to pride and the willingness to succeed?
What is so difficult about being able to take care of oneself? It is a sad
state of affairs that we have no shame in accepting handouts. And instead of
thanking the people who pay for our miserable and pitiful existence, we
demonize them and expect them to pay more.



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Choice, Transparency, and Progress



http://thetheoryofmediocrity.blogspot.com/
I recently had a debate with my 16
year old nephew about taxes and the government. He is under the assumption that
I should pay more in taxes even though he does not know what I earn or how much
I give to charities. That is right, my nephew, who has yet to pay one penny in
taxes, is lecturing me! It is disappointing he has already made so many
assumptions about taxes and other American citizens without having any facts or
information. What’s worse, he really did not grasp any economic philosophies
where higher taxes could result in fewer jobs or less consumer spending. So I
tried to explain my position on taxes from another angle.




I explained to him that I would have
fewer issues with paying taxes if I had a choice about how my tax dollars were
spent. After all, people choose to give money to charities because they
research them and in most cases charities explain where the money is going. This
brings me to my second point; the spending of our tax money should be 100%
transparent. I should not only be able to select where my tax money goes, but I
should be able to verify that the money is indeed going to the cause of my
choice. And we should be able to see how efficiently our tax dollars are being
spent. In other words, what percentage of our taxpayer dollars actually make it
to the person, program, or group we wish to fund. Finally, taxpayers should be
able to outline and demand what goal or progress they would like the funding to
accomplish. If the destination of the tax money does not hit prescribed goals,
then taxpayers can opt to send their hard earned dollars to another cause the
next year.





Unfortunately, any attempts by the
government to be transparent with taxpayer dollars usually end up being
deceitful, untrustworthy, or laced with misinformation. Case in point the
Recovery Act – remember that 863 billion dollar stimulus package. The
government site for the stimulus distorted facts and made up statistics not
maintained by the Labor Department such as jobs saved. And let’s not forget the
Obama administration’s misguided green program which is squandering taxpayer
money on companies like Solyndra.





It would be nice to see our taxpayer
money go to a family in our neighborhood whose adults are working two jobs each
but struggling to make ends meet. And it would be even better to see at least
90% of our tax dollars make it to the family who used the extra help to get a
better education and eventually a better paying job that got the family off
welfare. It is a nice dream, but it is not going to happen.





Americans are the most caring and
giving individuals in the world. When someone is struggling neighbors and friends
want to help. For this reason, if Americans can chose and see where their money
goes, they are more likely to be more charitable with their taxpayer dollars.
Unfortunately, politicians like to paint a deceitful picture about the use of
taxpayer money. When Obama signed ObamaCare into law he told several untruthful
stories about families that would benefit from the legislation.





The left claims they are progressive
because they want money to go to the poor and people in need. However, progress
does not stop at that point. The people collecting welfare should show they too
are progressing with the money they receive. People should not be on welfare
their entire lives! Individual responsibility and accountability is a major
part of progress. And if progress is not being made, then taxpayers should have
the opportunity to stop funding the individual, program, group, company, or
organization.





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Dual Federalism



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During the first one hundred years of United States
history, most of the governing of the people had been carried out by state and
local governments. During this time the federal government concentrated mostly
on foreign affairs. This type of governing was known as dual federalism. It was
determined during the drafting of the United States Constitution that a
national or federal government would be needed. This made absolute sense under
certain circumstances such as carrying out foreign affairs. Another example of
the federal government’s charter is to control the nation’s currency. Imagine
if each individual state had its own currency and how complicated that would
make our daily lives. Think of how Europe moved to the Euro currency instead of
dealing with all the exchange rates. Other powers of the federal government
according The Constitution are to: print money, regulate interstate and international
trade, declare war, and provide for the national defense. Other powers of the
state governments include to: regulate intrastate business, conduct elections,
establish local governments, and take measures for public health and safety.
There are a few concurrent powers that both the federal and state governments
can both do and they include to: collect taxes, build roads, borrow money,
establish courts, make and enforce laws, and spend money for the general
welfare.


 



Today, our state and federal governments have grown
so large and bureaucratic that they are in many cases redundant because they
carry out the same missions and goals. For example, both the federal and local
governments collect taxes to be used for entitlement and social programs. This
is a classic example of government redundancy, conflict of interest,
bureaucracy, and inefficiency at work. Nowhere in the federal government powers
does it charter them to take measures for public health, however this is
mentioned in the state government charter. For some unknown reason the federal
government feels compelled to interfere. This is a basic fundamental problem
with our federal government today. They feel compelled to overstep its bounds.
The federal government should either disperse tax revenue to the states or
allow states to raise its taxes for public health or safety reasons, which
should include social programs. Our forefathers wanted our nation to operate
efficiently hence, they purposely divided government powers between state and
federal governments so they can operate in a dual federalism mode. Besides, it
is awfully arrogant and presumptuous for the federal government to claim it
better understands state issues on morality or on social problems. Yet the
federal government seems compelled to interfere and dictate funding, policies,
and legislation. The onus should be on the states and solely on the states to
deal with their social problems, and our federal government including the
Supreme Court should not be involved. They should only be involved if a state
government is violating United States Constitutional law.



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The Outsourcer In Cheif

 
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The latest attack strategy from the Obama campaign on Mitt Romney is that his former company, Bain Capital, outsourced jobs overseas under his leadership. Personally, I have not researched these claims to check their validity. But even if it is true, the reason why jobs are outsourced is because companies, unlike the government, have to post a profit. And what progressives fail to recognize is that local, state, and federal government rules, regulations, and policies are what forces jobs to move overseas – not companies. Any policy, law, or regulation that makes it harder for businesses to conduct work or increase operating costs can lead to the outsourcing of jobs. Below is a list of Obama administration policies that will result in more jobs being shipped overseas: 
 
  • ObamaCare will have two effects on the future of this nation and neither is good. First, many companies may opt out of offering healthcare insurance to employees because it is cheaper for them pay the government fine. Secondly, if companies continue to offer healthcare insurance to employees, these costs are going to rise substantially placing more fiscal burdens on companies.
  • Policies such as quantitative easing and the Obama stimulus worked to flood the economy with money. The end result is higher inflation. Higher inflation is a tax on every American citizen and corporation.
  • Obama’s war on oil companies such as restricting fracking, denying oil drilling permits, and killing the Keystone pipeline are partly to blame for higher gas prices. Higher gas prices means higher energy prices for all American individuals and companies. 
  • Obama’s National Labor Relations Board (NLRB) pro union stance has prevented companies from moving to right to work states to lower their operating costs. The NLRB also took away the “secret ballot” making it easier for unions to expand; the NLRB decided that unionized workers should be forced to wait a “reasonable amount of time” before booting a union after a change of ownership at their shop; and finally, the NLRB allows for “micro-union” organizing at non-acute healthcare facilities. It is no secret how unionized companies push manufacturing jobs overseas because American companies cannot compete with foreign companies since employee benefit costs are much higher within unionized companies.  
  • Obama’s EPA has declared war on carbon emitting corporations with new rules, regulations, and bureaucracy. The result is higher operating expenses for corporations, especially energy companies. This can lead to jobs going overseas where energy costs and environmental laws are more lenient.
  • Obama’s green energy policy is leading directly to higher outsourcing because renewable energies are more expensive. Higher energy costs are a tax on all individuals and corporations.  
  • Obama’s ideology and obsession to tax the wealthy will end up being a tax on small business owners or will be less incentive for business owners to grow and expand their businesses. The bottom line is it will be cheaper for small businesses to open up manufacturing sites in other tax friendly countries.
  • The Obama administrations unwillingness to enforce illegal immigration laws and secure American borders essentially outsources U.S. jobs to Mexico because jobs going to illegal aliens are not going to taxpaying American citizens.
  • Obama protectionism policies are also worrisome. Obama has increased tariffs on China made products who in turn, have increased taxes on American made products.
  • Obama’s record debt spending will eventually result in few government jobs, and yes, even the possibility of outsourcing government jobs.
  • The goal of Obama’s educational policy “The Race to the Top” is to have students meet a watered down proficiency level in reading and math. While teachers work hard to get the poorest performing students to pass the test, meanwhile maximizing the proficiency levels of advanced students are overlooked. The bottom line is that as the U.S. continues to fall behind the rest of the globe in math and science, U.S. corporations must continue to outsource engineering and other innovative jobs.  

Romney may or may not have outsourced jobs, but the fact of the matter is our president’s policies have done nothing but promote the outsourcing of jobs. This should come as no surprise since this president and his administration have no practical economic or business experience.  

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Representation Without Taxation

 
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Many Americans fought for their independence from England because they were taxed, but at the same time they had no representation in the English parliament. The Declaration of Independence clearly points out this grievance as to why we sought our independence: “For imposing taxes without our consent”. How things have changed over the last 230 years. Today, many people in our society receive representation in our government, but fail to pay a single penny in income taxes.

Today, 60% of Americans pay income taxes and therefore, support the government programs that the other 40% of Americans enjoy. Many of these programs are entitlements that include food stamps, unemployment, housing subsidies, welfare, Medicaid and or ObamaCare. These welfare entitlements are bankrupting our nation and they are the fastest growing segment in our national budget along with social security and Medicare. As more and more Americans become eligible for social handouts it forces the government to raise taxes on the wealthy to pay for these benefits. However, at some point, increased taxes on the wealthy yields lower federal revenue because higher taxes reduce the incentive for responsible workers to earn more money. This phenomenon is often referred to as the Laffer Effect. Thus, raising taxes alone will not solve the problem of billions of dollars in unfunded liabilities to pay for these massive social entitlement programs. The only solution is to cut these benefits.

Cutting social benefits is easier said than done. First, any attempt to cut benefits will resort in massive protests and civil unrest. We have seen examples of this in Greece. As soon as the government proposed cuts to social programs the masses began violent protests. Secondly, the poor in our country are united along the progressive ideology. Thus, they make up a huge portion of the electorate and they support Democratic candidates that will continue to provide them welfare benefits. The progressive welfare coalition is joined by middle class minorities, liberal academic elites, and blue collar union workers to make up well over 50% of the electorate. Thus, it is hard to get candidates into office that will reform social entitlements. Thirdly, many of the people collecting these welfare benefits have been trained, like Pavlov’s Dog, and do not know any better. They have been taught through the generations that the government will support them. This is why there is no incentive for kids to be responsible and do well in school. This is going to be a tough barrier to bridge. In fact, most people receiving entitlement benefits have absolutely no earthly idea where the money is coming from.

Sure, many Americans receive government assistance to help them through a tough time, but many others abuse these privileges and accept handouts their entire lives. Is this fair? Is this a right outlined in our Constitution that a vast portion of our population should rely on others hard work to survive? At the same time, is it fair that an individual who contributes nothing positive towards society has the right to vote? In fact, the tax burden on the wealthy will always have a massive negative impact on the economy because it prevents the growth needed to create new jobs and the limits the funding needed to create innovative new products to stem future growth.  

Yes, I have empathy for the poor and would like to help them. However, being poor is similar to being addicted to drugs and alcohol, but instead being addicted to a substance individuals are addicted to the government. The only way for people to break their addictions they must first realize they have a problem and then they must help themselves. Any help from others only “enables the behavior” to remain addicted and does nothing to remedy the situation. Anyone who has lived with a family member that is dependent on drugs or alcohol understands this concept all too well.

Thus, it is time to break this entitlement addiction by reducing benefits. Nobody should ever be offered entitlement benefits over their entire life. Set incentives that a person must have a high school diploma to earn a drivers license or the right to vote. Everyone must be forced to make a positive impact towards society. We must have fewer people who are dependent on our government and do not pay their fair share of dues to society.   

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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Political Hypothesis

 
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Many political subjects, problems, and issues are based on imperfect mathematical models or hypothesis (that politicians do not understand). Thus, it is hard to understand why both liberal and conservative followers claim to be 100% correct on issues. Here are a few examples:

Taxes – Conservatives believe that lower taxes results in more consumer spending and creates a better environment for industries to compete and grow. Liberals believe in higher taxes to spread the wealth from the rich to the poor. Thus, the argument is does higher taxes on the wealthy hurt or help the economy? This is a complex problem that even most economist cannot accurately answer even if they create mathematical models (remember models are by no means perfect at predicting the future). It is indeed plausible that during certain years the liberal tax philosophy works better than the conservative tax model (only during good times). I have spent many hours crunching economic numbers and my results indicate the conservative tax approach works best over 90% of the time.

Climate Change – Democrats insist that climate change is manmade, while Republicans say it is not. Once again, there are very few liberals or conservatives in this country that can argue this subject with complete clarity without completely understanding the models used to calculate and draw conclusions on the subject. And what’s worse is that the only reasonable solution Democrats have to this problem is cap and trade, which will turn the U.S. economy upside down. There are other reasonable solutions, but politicians fail to look at them because they are tied to lobbyists and only care about themselves and making money.

Economic Policy – Progressives believe in a Keynesian model where government spending stimulates the economy. On the other hand, conservatives believe in supply side or trickledown economics where the consumer stimulates the economy. Keynesian approaches used during the FDR, Carter, and Obama administrations were arguably utter failures. But some economists still argue that government stimulus during these presidencies did combat potentially higher unemployment rates and obtained some economic growth. In fact; Obama is generating fictitious statistics such as “saved jobs” to defend his hypothesis that government stimulus spending is the best way to reverse an economic recession.

Entitlement Programs – Democrats follow the hypothesis that social programs and government handouts make America a better nation because it shows compassion. On the other hand, Republicans follow the thought process that government handouts do very little to place any urgency or incentive on people to better themselves. In some respects the Democrats are correct because there are always hard working Americans who are going through a tough time and require assistance. On the other hand, Republicans are correct because there is a large portion of the population that takes advantage of social programs and they provide nothing positive towards society over their lifetimes. It should be easy to find a middle ground to reform these programs, but it is impossible if everyone is hard headed.  

If only politicians and Americans could understand that their philosophies are not necessarily 100% correct, we could compromise. For instance, on climate change we could all agree that carbon emissions are a pollutant and decide on a solution that does not affect our economy. On entitlements we can agree that people can use assistance from time to time but place a lifetime cap on Medicaid and Food Stamps. On economic policy we can agree to a two prong approach that consists of some government spending and some tax cuts. On taxes we can agree to cut all tax write offs.

In a recent study (over the past 30 years) of the most popular economic and political pundits - far less than half of their predictions were correct. And it is important to note, in this study, these so called experts merely had to predict the outcome out of two possibilities such as would Quebec succeed from Canada, Yes or No. In other words, a monkey or a two year old could prognosticate better than these experts since by the law averages they should get 50% correct. 

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Tags: welfare   Taxes  
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Coercion (Part II)



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It seems everything the federal government does is coercive against the states, companies, or individuals. Justice Scalia suggested that the States “got an offer they could not refuse” and they signed away their sovereignty when they signed onto to Medicaid in 1965. Scalia may be right, but even in 1965 the states had no choice but to sign up for the Medicaid program. Let’s think about it. Two amendments drastically reduced the rights or sovereignty of states well before 1965 – the 14th (adopted in 1868) and 16th amendments (adopted in 1913). The 14th amendment gave the federal government power to rule on states’ due process laws. The 16th amendment gave Congress the right to impose an income tax. Once Congress had the right to levy an income tax, they had complete power over the states. In 1965, the federal government did give the states an offer they could not refuse – take our help on Medicaid or get nothing. After all, it would have been economic and political suicide not to accept the money and instead double tax the citizens of states to help pay for health coverage for the disabled or needy. 

The 16th amendment has enabled the federal government to coerce states for nearly a century. The government created departments not enumerated in the federal powers of the Constitution including: HHS, Department of Education (DOE), Department of Energy (Doe), Department of Agriculture (USDA), and Department of Transportation (DOT) – to name a few. The federal government collects tax money from the individuals of each state, and if the states want to recoup this money they have to adhere to federal government power grabs for universal control over healthcare, education, energy, agriculture, or transportation. For instance, the Department of Education created a new program called “The Race to the Top”. There was 4.3 billion dollars of state funding hidden in the American Recovery and Reinvestment Act of 2009 (the 862 billion dollar stimulus) for the Race to the Top. Even though The Race to the Top was not a law, the federal government coerced states to abide by their guidelines to get funding for this program. Some claim that this is not coercion because the states could just refuse the money – it is voluntary. But this is not going to happen, especially during a recession where states were already cash strapped and did not want to double tax its citizens. Besides, the government could have just as easily divided the money up evenly (population adjusted) amongst the states without any strings attached – they did not do this.  

Let’s face facts; the introduction of the 16th amendment made the 10th amendment moot. States are now at the mercy of the federal government. And what’s worse, the 16th amendment made this country more bureaucratic, less efficient, and more susceptible to fraud and waste. For example, the tax payers of Ohio send their tax dollars to the federal treasury which in turn, funnels the money to federal departments which in turn, funnels the money back to the states treasury which in turn, funnels the money into state departments. Things would operate much more smoothly if the states taxed their people and spent the money as they saw fit, and cut out the middle man – the federal government. This simply makes sense and is more logical because states and localities better understand their issues and problems than the federal government. To assume that education or Medicaid has the same variables in Los Angeles California as it does in Alamosa Colorado is just wrong. Some may argue that by having the federal government controlling laws and regulations for HHS, DOE, Doe, USDA, and DOT makes legislation more consistent and equally enforced amongst states. This is not even remotely true and is exactly why legislation is thousands of pages long, because bills are laced with pork, earmarks, and waivers influenced by lobbying which does the contrary, it makes laws inconsistently enforced not only amongst states, but among corporations and individuals. Just this past week Congressional Democrats were talking about cutting tax incentives for only oil companies, but not tax incentives and funding for green companies – is this a fair law equally enforced amongst corporations?

How about federal standards the Environmental Protection Agency (EPA) puts on industry – is this coercion? Yes, I believe so. The EPA is placing emission standards on energy manufacturers before the implementation of methods to conform to such rules are commercially available. This forces companies to cut back workers or increase energy consumption costs on individuals and companies. The same thing happens when the EPA places gas mileage standards on cars, automobile manufactures have to increase costs and cut corners on safety to meet such demands. This is coercion, the government is forcing companies to comply or receive fines. And what’s worse, these actions by the EPA make products more expensive and possibly even less safe.  

All this being said, even if the Supreme Court rules in favor of the states completely severing ObamaCare, it is improbable they will say the legislation is coercion.

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Drawing Conclusions

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Everybody draws conclusions and takes sides on issues. Some people do their homework, others rely on sources that tell one side of the story, and still others just go along with the consensus. I would like to consider myself as a person that does their homework before drawing conclusions. In fact, I would like to say that I try to “think out of the box” when drawing conclusions. To think out of the box one must be open to information from all sources and one must also be willing to inspect the situation from different perspectives. It is also imperative when drawing conclusions to use and properly analyze bipartisan statistics using acceptable mathematical concepts. Finally, to draw conclusions one must be able to show all their math work as well as all their sources. After all, to properly draw a conclusion, one must be able to defend their position using logic and sound judgment.

Unfortunately, very few people do the necessary work needed to draw “reasonable” conclusions on issues. The biggest mistake people make is drawing a conclusion based solely on what another pundit thinks is correct. To properly draw conclusions each person should prove their point of view to themselves. For example, I may have drawn some of the same conclusions on government spending as say Sean Hannity, Glenn Beck, or Rush Limbaugh, but I did not necessarily come to the conclusion in the same manner. While these conservative pundits may bring religion and their historical perspective on data, I use real numbers from government sites to create models to prove to myself what the effects of raising taxes on the wealthy, or the effect of having our economy move to wind or solar energy, or if there is a direct relationship between carbon emissions and global temperatures. And I serious doubt that any economic or political pundit will crunch the numbers to these complex problems as thoroughly as I will. As a recent study indicated – economic and political pundits are correct far less than 50% of the time when prognosticating the outcome of 2 scenarios. For instance, when asked if inflation will go up or down next year, pundits are less likely to predict the outcome correctly than flipping a coin.

Yes, many scientists have created models to prove climate change is manmade or taxing the wealthy reduces consumer spending. However, most scientists refuse to not only show their models and data, but refuse to show their calculations. I tutor two gifted grade school kids in math. Both have a unique a way of seeing and solving math problems, but in the end they generally come to the same conclusion. Yes, they solve the same problem using different methods – and this can be clearly seen because they show their work. Until scientists show their work it will be hard for me to accept what either side is saying is true or false because most of these scientific studies are funded by special interest groups.

The bottom line is it is not enough to accept conclusions just because they agree with those made by specific pundits. Prove it to yourself. You may be surprised to find out that you may come to the same conclusion as pundits, but for different reasons. This will enable people to better understand issues and therefore, better at offering “reasonable” solutions to problems and issues. Political and economic pundits will always draw conclusions, but they will rarely provide “reasonable” solutions to the problems and issues they are debating.  

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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The Regressive Party

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One favorite label that progressives or liberals like to place on conservatives is that they call them the regressive party. Regressive is defined as tending to return or to revert. It is also defined as decreasing proportionately the amount of taxes – regressive tax. Regression is defined as a trend or shift toward a lower or less perfect state – for instance a disease, body function, mental state, or motion can all regress. And yes, the definition of progressive is the opposite – moving forward or advancing in incremental steps. At first glance the regressive label does not seem fair. Although I am conservative my philosophies of implementing a fair tax would yield more revenue for both individual citizens and the federal government. My personal story is that I grew up in poverty – but I have given my fair share of income in taxes and charities without ever accepting a penny in federal handouts. I have helped foster advancements in technology that have made our lives easier, less expensive, and safer. If that is regressive then so be it. To be perfectly honest, the regressive generalization angered me.

By the same token, what is progressive about liberal philosophies and ideas? Abortion as a means of birth control – is that a progressive idea? What about labor union concepts of rewarding and protecting bad employees - how exactly is this progressive? If anything, these ideas lead to mediocrity – look at the American automotive industry when compared to other global auto companies or how education has declined in our country with students being less proficient in math, science, and reading and more kids dropping out of school. How have entitlements and quota systems improved corporate competitiveness or individual advancement? Today, on average, more people live in poverty than 50 years ago. Minorities are segregated more than ever living miserable lives fighting crime and addiction in inner city slums. The family unit has disintegrated - most families living on welfare are of the single parent variety. Meanwhile corporate innovation, exports, and technological advancements have slowed. Yes, it is easy to surmise that the regressive party is the Democratic Party. To me, being regressive is being a burden on society – by having others pay for our existence – this is the Democratic way. 

The more that I thought about the regressive accusation, the more I began to realize that there is some truth to it. In many respects I would like to go back to the earlier interpretations of the Constitution, a smaller government, and more state rights. Still, another definition of regression is to determine the relationship between two or more correlated variables – usually determined by empirical data – to predict future outcomes. Thus, in order to determine and solve the complex problems of tomorrow we need to first regress. In other words, we need to be able to break down the problem into a set of older individual data points or variables. These are the tool that scientists use to understand the relationship between temperature and carbon emissions; or the relationship between tax rates and tax revenues or consumer spending; or the relationship between increasing Medicaid patient payrolls on healthcare costs or the quality of healthcare. These are indeed complex problems that unfortunately very few people have the capacity or the mathematical skills to build an accurate linear regression model to solve these issues. For what it is worth, I have created models, using data from government sites, to solve the above problems. I am not saying my models are correct (they need to pass the test of time), but at least I have the ability to break down problems to find what set of variables correlate to find solutions. By definition a progressive does not have this ability – but I will not make that generalization. What I will say is that being classified as a regressive is not all bad – especially if you have the ability to break down and solve the complex problems that face the future of our nation (that is progressive).  

I do not care that people have opinions, one way or the other, on these complex problems. What disturbs me is that everyone thinks their opinions are the 100% correct even though they not only fail to understand the math behind the problem, they have never seen the model or math solution. This is very sad and it is a testament to our narcissism and “know it all” mentality. But if you want to label me as a regressive – go ahead – I now see it as a compliment.    

My Book: Is America Dying? (Amazon.com, Barnes and Noble) 

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Obama Mirrors Bush Policies

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The Obama and Bush administrations have been for the most part polar opposites. However, most of what has gone right for Obama has been because he has mirrored or extended Bush policies, especially against terrorism. Here are a few examples:
  • Obama continued the Bush policy of hunting for Osama Bin Laden. And when Obama found him, he did exactly what Bush would have done; he killed him and ignored his civil liberties.
  • Obama continued the Bush policy of keeping terrorists housed in Guantanamo Bay. Obama, like Bush, is holding detainees’ indefinitely without a charge. And when the enemy combatants are charged with criminal acts he is trying these detainees in a military tribunal and not a civilian court. These are all liberal promises broken by the naïve and misguided President elect who seemingly thought extreme Islam was a hoax.
  • Obama has not only continued the Bush policy of using drone strikes to knock out al-Qaida targets in Afghanistan, Pakistan, and Yemen, he has escalated the use of this strategy.
  • Obama went to war to overthrow a rogue and genocidal tyrant in Libya similar to how Bush went to war with Iraq. The difference is that Bush had the fortitude to finish the job. In effect, Obama was supporting the Bush “Freedom Agenda” in the Middle East when he went to war against Libya. As other oppressed Arab nations saw Democracies flourish in Iraq and Lebanon (Cedar Revolution backed by Bush), they too wanted the same freedoms. As a result, dozens of revolutions broke out across North Africa and the Middle East. Unfortunately, Obama missed out on many of these opportunities to oust terrorist supporting governments.  
  • Obama has continued both the Bush Iraq and Afghanistan wars. In fact, Obama has implemented the Bush “surge strategy” in Afghanistan. 

Obama has also successfully mimicked a few alleged successful George Bush domestic strategies:

  • Obama continued the unpopular Toxic Asset Relief Program (TARP) that bailed out banks and financial institutions. To date, many of the loans have been paid back with interest.
  • Obama has continued the Bush tax cuts for all tax brackets. Obama’s economic advisors correctly understand that raising taxes on the wealthy during a recession would be bad for the economy.
  • Obama also continued the Bush policy of bailing out the automotive companies. Although many credit these bailouts for keeping GM and Chrysler solvent, bailouts did not stop them from going in bankruptcy, which ultimately got their financial standing under control.

Obama and Bush also have some troubling policy similarities:

  • Both Obama and Bush will go down as the top Democratic and Republican deficit spending presidents in U.S. history.
  • Both Obama (Democrats) and Bush (Republicans) are responsible for getting us into one of the worst recessions in U.S. history and both were unsuccessful in getting us out of the mess in a timely matter.

Oddly, Obama is quick to blame Bush for all of his failures, but he has never given Bush any credit for his successes. For instance, when the 1 trillion dollar stimulus and quantitative easing techniques failed to alter the recession’s outcome for the better, Obama would routinely blame Bush for getting us into the mess in the first place. And let’s not forget Obama and Democratic policies, under Bush, such as those used by mortgage giants Fannie and Freddie were a leading cause for the financial and housing collapse. Still, Obama has taken no responsibility for the economic calamity and his failed measures to correct the recession. And finally, in his speech following Bin Laden’s death, Obama alluded to the fact that the Bush administration took its eye off the prize (Bin Laden). But, according to reports, information collected under Bush’s watch led directly to the killing of Bin Laden (and some of that information came from enhanced interrogation techniques). Still, Obama gave Bush no credit. It is therefore a fact that had Obama been President after 9-11, we would have never gotten the intelligence necessary to kill Bin Laden. The bottom line, Obama is only successful when he emulates Bush policies.  

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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If You Believe, Then ..... (Part II)

 
  • If you believe in diversity, then you should not be angry when jobs go overseas because education standards are lowered.
  • If you believe in climate change, then why do you support renewable energies which are dependent on climate and stable weather patterns (renewable energy sources will obviously be rendered obsolete if weather patterns change)?
  • If you believe in entitlements, then why do you support abortion (entitlements require a large taxpayer base to sustain them)?
  • If you believe in expanding entitlements for more Americans, then how does the government sustain this burden if the taxpayer base to pay for entitlements is shrinking?
  • If you believe in taxing the wealthy more, then what tax rate do you find acceptable for them? Keep in mind if the government taxed the top 1% at a 100% rate, it would not account for paying off one third of our national debt this year alone. Also, most analysis show that a tax rate higher than 35% (local, state, and federal combined) reduces incentives to earn more and therefore, lowers economic growth and lowers employment (Laffer Effect).
  • If you believe education, food, housing, and healthcare should be free then how do you propose to pay for it (these items account for over one half of U.S. GDP)?
  • If you believe everyone should be a vegan, then how do you propose to feed the global population if over half of its food supply is off limits (keep in mind that today, one third of the worlds’ population is already underfed)?
  • If you believe the government is the answer to our problems, then why are they so far in debt (hint – waste, fraud, redundancy, and bureaucracy)?
  • If you do not believe in food additives, chemicals, and growth hormones, then how do you propose we meet the demand of feeding 315 million people in the U.S alone (this is an economic problem based on supply and demand)?
  • If you believe in gun ownership restrictions, then amend the Constitution.
  • If you believe corporations are greedy and evil, then why do you use the products they produce?
  • If you believe in lowering the costs of healthcare, then why are you unhealthy?
  • If you believe that CO2 is causing manmade climate change, then why is your lifestyle and personal footprint emitting CO2?
  • If you believe the economy is doing poorly, then why do you support cap and trade policies?
  • If you choose not to work and to be unproductive, then what you gives you the right to accept income from hard working and productive Americans?
  • If you do not believe in big government, then you should not accept any help from any government agencies.
  • If you believe waterboarding violates civil liberties, then why do you think it is acceptable to execute enemies and innocent civilians (i.e. al Awlaki, bin Laden, drone attacks)?
  • If you believe Citizens United was a poor decision because money is not free speech, then explain how burning the American Flag is free speech (money is just as much a freedom of expression as burning the American flag)?
  • If you do not believe the Iraq war was necessary because they were not a threat to our national security, then why was our involvement in Libya acceptable?
  • If you do not believe in God and religion, then you should not accept any charity from religious organizations.
  • If you believe in something, then you should practice what you preach and if you must complain about something, then offer solutions without placing blame.  

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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If You Believe, Then ....... (Part I)

 
  • If you believe in science and the theory of evolution, then why can’t you believe evolution is God’s plan?
  • If you believe in evolution and survival of the fittest, then why do you believe in welfare and helping the poor?
  • If you believe in evolution and survival of the fittest, then why do you believe in rewarding irresponsible behavior and penalize responsible behavior?
  • If you believe in evolution, then what makes you think we can alter climate change?
  • If you believe that painting the roofs of our homes white will cool the planet, then why do you think CO2 is causing hotter climates (roof painting does nothing to reduce CO2 concentrations in the air)?
  • If you believe ocean levels are rising due to climate change, then why rebuild New Orleans (a city that resides -10 feet below sea level) and why are coastal areas the fastest growing areas not only in the U.S., but around the globe?
  • If you believe CO2 is causing global warming, then why are most studies focused on Arctic regions where climate change effects should be minimal based on environmentalists’ claims? Remember, Artic CO2 concentrations are very low (earth’s gravitation pull is less), artic snow and ice reflect heat, and there is a lack of population and infrastructure to absorb heat.
  • If you believe in protecting endangered species, then you may consider allowing humans to eat them (most animals eaten by humans are plentiful – cattle, deer, chickens, turkeys, etc.).
  • If you do not believe hunting is necessary, then you probably never realized that a large portion of Americans count on hunting to feed their families.
  • If you believe in the fairness doctrine, then you cannot truly believe in free speech.
  • If you believe in the fairness doctrine, then why are you against applying the doctrine to other media outlets such as the internet, TV, and even our schools?
  • If you must protest something, then do it a lawful and respectful manner.
  • If you believe in separation of Church and State (which, incidentally is not in the Constitution), then why don’t you believe in separation of State with ANY organization or company – this too is a conflict of interest and welcomes lobbyists and quid pro quo crony politics?
  • If you believe in multiculturalism, then why don’t agree with assimilation - remember language in the biggest barrier for cultures to integrate?
  • If you believe in diversity policies, then why do you agree with entitlement policies, which promote the segregation of minorities and the poor in our inner cities (and the segregation of Native-Americans on reservations)?
  • If you believe in green energy and everyone should own a home, then you should not be angry when these economic bubbles burst and cause a recession.
  • If you believe in the economic stability of our nation, then you should never elect anyone to any government post that does not have business experience. 
  • If you believe in diversity policies, then why do you believe in the evolution theory survival of the fittest?
  • If you believe in climate change, then you must have seen and understand the complex scientific and mathematical models used to predict future outcomes (a picture of a Polar Bear on a melting ice float is not science)?
  • If you are wealthy and believe the government should raise your taxes then why don’t you donate money to the government to pay off our debt (there is a government program for this) and or eliminate your tax write offs?
  • If you believe in unions, then you should not be angry when jobs go overseas and education standards are lowered.
  • If you believe in mining lithium and cobalt to make car batteries, then why are against drilling for oil (much smaller footprint)?
  • If you believe that corporate CEOs are greedy and evil, then why don’t believe Washington politicians are the same? Most Washington politicians exit the profession as multi-millionaires on modest salaries because they are exempt from insider trading laws and they sell political intelligence.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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Economic Model Summary

What was learned from the economic models posted over the past several months?
 
  • If the federal government raises taxes and receives more tax revenue it spends more money because the debt, budget and government spending continue to increase.
  • Maximizing consumer spending does just as much to reduce the poverty level as increased government spending and debt.
  • Government Social Benefits needs to be minimized. This economic parameter had the most significant negative impact on other economic parameters.
  • Government budget deficits and debt need to be minimized. This economic parameter had the second most significant negative impact on other economic parameters.  
  • Population increases had little impact on economic parameters.
  • State budget deficits and state social benefit payments had little overall impact on national economic parameters.
  • Consumer spending needs to be maximized. This parameter had the most significant positive impact on other economic parameters.
  • Personal income needs to be maximized. This parameter has the second most significant positive impact on other economic parameters.
  • The trade deficit has a big impact on many economic indicators (some good and some bad).
  • Economic parameters such as GDP, tax receipts, unemployment, inflation, and government spending had less of an impact on other economic parameters than one may suspect. 
  • Government spending is a leading cause for inflation and driving energy prices and healthcare costs higher.

These are just a few of the obvious observations. I will also post models in the future on other complex issues / problems including healthcare and climate change.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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Summary: The Relationship Between Taxes, Income, Spending, Debt, Social Benefits, and the Trade Deficit

This is summary of linear regression model results (posted over the past several weeks) on the relationship between taxes, income, debt, spending, social benefits, and the trade deficit. The following results are dependent on changing the fifth quintile’s effective tax rate from 13 to 17.5%, its income from 46,800 to 50,800 dollars, and its consumer spending rate from 36 to 40%. This models the result if the highest income bracket tax rate is increased from 35% to 39.5%.
 
  • Federal government Tax Revenue will vary from 1.09 trillion to 1.26 trillion dollars. The model accuracy is perfect (R² = 1).
  • Consumer Spending will vary from 12.2 trillion to 12.9 trillion dollars. The model accuracy is perfect (R² = 1).
  • The federal government Effective Tax Rate will vary from 8.3% to 11.2%. The model accuracy is perfect (R² = 1).
  • Federal government expenditures on Social Benefit spending will vary from 1.74 trillion to 2.13 trillion dollars. The model accuracy is near perfect (R² = 0.97).
  • The national Debt will vary from 9.6 trillion to 11.5 trillion dollars. The model accuracy is perfect (R² = 1).
  • The national Trade Deficit will vary from a loss of 441 billion to 813 billion dollars annually. The model accuracy is perfect (R² = 1). The trend results are similar if the trade deficit is adjusted for oil imports.

Similar results are achieved from another model that varies the effective tax rate from 8% to 11%, the first quintiles adjusted social benefits income from 17,800 dollars to 21,800 dollars, and the fifth quintiles adjusted social benefits income from 46,800 dollars to 50,800 dollars.

  • Federal government expenditures on Social Benefit spending will vary from 1.8 trillion to 2.03 trillion dollars. The model accuracy is near perfect (R² = .97).
  • The national Debt will vary from 9.15 trillion to 10.95 trillion dollars. The model accuracy is near perfect (R² = .99).
  • The national Trade Deficit will vary from a loss of 725 billion to 881 billion dollars. The model accuracy is near perfect (R² = .98). The trend results are similar if the trade deficit is adjusted for oil imports.

Since consumer spending, income, and the tax rate are directly related – it makes sense to use all three when computing the tax rate. An example of a fair tax rate formula is: Tax Rate (TR) = Income (I) / (1 / (1 – Consumer Spending (CS))). After all, if the tax rate goes up and consumer spending goes down, it will adversely affect the economy.

Summary: If the federal government raises the income tax on the highest earners (fifth quintile) from 35% to 39.6%: tax revenues will go up nearly 170 billion dollars annually; consumer spending will go down 700 billion dollars; the effective federal income tax rate will go up from 8.3 to 11.2%; the federal government spending on social benefits will increase by 300 billion dollars; and the national debt will sore 1.9 trillion dollars. These results track if a separate model is created taking into account adjusted national incomes due to social benefits (entitlement spending). The bottom line – increasing taxes on the highest earners will only create higher social benefit spending, a much greater national debt, and much lower consumer spending that could cost the economy up to 2 million jobs. In other words, raising taxes is the main ingredient in a formula to create a recession. On the hand, there is an argument that increased taxes could both increase or decrease the trade deficit.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

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10 Worst Tax-Friendly States for Retirees

 

This is a good article by Kiplinger.com. Interestingly, 9 of the 10 states are for the most part liberal states, which voted for Obama in 2008. These states work to not only drive away retirees, but the working class and industry. A few states on this list, such as Wisconsin and New Jersey, are trying to change for the better. Kiplinger.com did a similar article rating the top 5 tax friendly states to retire. They were Wyoming, Mississippi, Pennsylvania, Kentucky, and Alabama. It comes as no surprise that 4 of these states are conservative strongholds.

Some states offer attractive tax benefits for retirees. Then there are these ten tax hells, which have earned a place on our "do not live here for your second act" list either because of higher-than-average taxes across the board or because of policies that don't exempt much retirement income from state taxation.

For retirees living on a fixed income, high income taxes, burdensome real estate taxes and hefty sales taxes on daily purchases can really eat into a nest egg. Choosing to relocate to — or stay put in — a state with a low overall tax burden can help stretch your retirement income.

#1 VERMONT
State Income Tax: 3.55%-8.95%
State Sales Tax: 6% (localities can add another 1%)
Estate Tax/Inheritance Tax: Yes/No

There are no exemptions for retirement income in the Green Mountain State, except for Railroad Retirement benefits (which are exempt in every state). Out-of-state pensions are fully taxed. Vermont exempts medical devices and prescription and nonprescription drugs from its 6% sales tax. But it imposes a 9% tax on prepared foods, restaurant meals and lodging, and a levies a 10% sales tax on alcoholic beverages served in restaurants. Real estate taxes have two components: school property tax and municipal property tax collected by towns and cities where the property is located. The Tax Foundation, a nonprofit tax-research group in Washington, D.C., lists Vermont's property tax among the ten highest in the nation.

#2 MINNESOTA
State Income Tax: 5.35%-7.85%
State Sales Tax: 6.875% (cities and counties can add another 2.65%)
Estate Tax/Inheritance Tax: No/No

Minnesota offers retirees cold comfort on the tax front. Social Security income is taxed to the same extent it is taxed on your federal return. Pensions are taxable regardless of where your pension was earned. Income-tax rates are high, and sales taxes can reach 9.53% in some cities. Food, clothing, and prescription and nonprescription drugs are exempt from sales taxes. The North Star State does offer some residents 65 and older who have income of $60,000 or less the option of deferring a portion of their property tax. But this is a low-interest loan, not a tax-forgiveness program.

#3 NEBRASKA
State Income Tax: 2.56%-6.84%
State Sales Tax: 5.5% (localities can add another 1.5%)
Estate Tax/Inheritance Tax: No/Yes

There are no tax breaks for Social Security benefits and military pensions in the Cornhusker State. Real estate is assessed at 100% of fair market value. Residents 65 and older qualify for a homestead exemption on property taxes. Food and prescription drugs are exempt from state sales taxes. But Nebraska imposes an inheritance tax on all transfers of property and annuities.

#4 OREGON
State Income Tax: 5%-11%
State Sales Tax: None
Estate Tax/Inheritance Tax: No/Yes

First, the upside: There's no state sales tax in the Beaver State. But it shares the distinction with Hawaii of imposing the highest tax rate on personal income in the nation on taxable income of $250,000 or more. Although Oregon does not tax Social Security benefits, that's the extent of its income-tax breaks for retirees. And Oregon has an inheritance tax that applies even to intangible personal property, such as investments and bank accounts, no matter where it is located.

#5 CALIFORNIA
State Income Tax: 1.25%-9.55%
State Sales Tax: 7.25% (effective July 1, 2011)
Estate Tax/Inheritance Tax: No/No

The Golden State has lost its luster for many retirees. Although Social Security benefits are exempt from state income taxes, all other forms of retirement income are fully taxed. Californians pay some of the highest income taxes in the U.S., with the top rate of 9.55% kicking in at $46,767 of taxable income. State and local sales taxes can reach 9.25% in some cities, although food and prescription drugs are exempt. Real estate is assessed at 100% of cash value, but taxes are capped at 1% of value.

#6 MAINE
State Income Tax: 2%-8.5%
State Sales Tax: 5% (counties can add another 0.5%)
Estate Tax/Inheritance Tax: Yes/No

Like the majority of states, Maine exempts Social Security benefits from state income taxes. And residents can deduct up to $6,000 per person of eligible pension income. But remaining income in excess of $20,150 per year is taxed at a steep 8.5% rate. Residents of the Pine Tree State pay a 5% sales tax statewide on everything except food and prescription drugs. All real estate and personal property is subject to local property taxes (and, in some cases, state property taxes, too), but permanent residents can receive an exemption of $10,000 on the assessed value of their home. Maine is also one of only three states that do not allow cities and towns to impose their own local sales taxes.

#7 IOWA
State Income Tax: 0.36%-8.98%
State Sales Tax: 6% (localities can add another 1%)
Estate Tax/Inheritance Tax: No/Yes

The Hawkeye State offers no feathered nest for retirees. Although it allows single retirees to exclude up to $6,000 of retirement-plan distributions from state income taxes, and married couples can exclude up to $12,000, the rest is taxed at rates as high as 8.98%. Iowa taxes a portion of residents' Social Security benefits, too, although it is in the process of phasing out the Social Security tax, which is scheduled to disappear in 2014. Food and prescription drugs are exempt from the statewide 6% sales tax. Real estate is assessed at 100% of market value, and most property is taxed by more than one taxing authority, such as cities, counties and school districts. There is a small homestead tax credit for residents who live in-state at least six months of the year.

#8 WISCONSIN
State Income Tax: 4.6%-7.75%
State Sales Tax: 5% (counties can add another 0.5%)
Estate Tax/Inheritance Tax: No/No

The Dairy State exempts Social Security benefits and military-related pensions from its state income taxes, but it taxes most other pension and annuity income the same way the federal government does. Retirees 65 and older can subtract $5,000 of qualified retirement income, including IRA distributions, from their Wisconsin taxable income, subject to income restrictions. Some Wisconsin state- and local-government retirees qualify for a tax exemption. But out-of-state government pensions are fully taxed. Food and prescription drugs are exempt from state sales taxes. Some homeowners may qualify for a school property-tax credit against their state income tax.

#9 NEW JERSEY
State Income Tax: 1.4%-8.97%
State Sales Tax: 7%
Estate Tax/Inheritance Tax: Yes/Yes

Its nickname may be the Garden State, but New Jersey is no Eden for retirees. The Tax Foundation says New Jersey's combined state and local tax burden is the highest in the nation, thanks in part to sky-high property taxes. But there are a few bright spots: New Jersey does not tax Social Security benefits and military pensions. It also allows residents 62 or older with incomes of $100,000 or less to exclude up to $15,000 ($20,000 for married couples filing jointly) of retirement income, including pensions, annuities and IRA withdrawals. Groceries, medicine and clothing are exempt from the 7% statewide sales tax. The state imposes an inheritance tax on the transfer of real and personal property worth $500 or more, but bequests to family members are exempt. Even with the bright spots, it's an expensive place to live for retirees.

#10 CONNECTICUT
State Income Tax: 3%-6.7%
State Sales Tax: 6.35%-7%
Estate Tax/Inheritance Tax: Yes/No

Connecticut can be inhospitable to retirees, depending on their income and where they earned their retirement benefits. Although some residents of the Constitution State can exclude their Social Security benefits from state income taxes, the exclusion applies only if their adjusted gross income is $50,000 or less ($60,000 or less for married couples). All out-of-state government and civil-service retirement pensions are fully taxed. Effective July 1, 2011, the sales tax rate statewide is 6.35%, with luxury items taxed at 7%. Connecticut residents pay some of the highest property taxes in the U.S., according to the Tax Foundation, but residents 65 and older qualify for an annual property tax credit or rent rebate.

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