Saving Money is Stupid
Our government and economic system is configured to support you in spending everything that you earn except for the money that you save in qualified retirement funds. Anything that you save beyond your qualified accounts will result in a tax penalty.
As of January, 2012, there will be an additional 3.8% Medicare surtax on the net investment income from your savings if you earn $250,000 per year filing jointly, $125,000 for married couples filing separately, and $200,000 for single filers. (Side note: In America you get a tax benefit for being married, but only certain people are allowed to get married - its complicated.)
Do not accrue assets in excess of $1 Million if you plan to die. I know that everyone plans to live and nobody plans to die, but sadly - you will someday. Any savings or assets over $1 Million will be seized in part by the US Federal Government as a penalty for your slimy attempts to preserve wealth for future generations. If you happen to own a farm or a small business, be sure and liquidate it and blow the money before you die.
Your goal as an American is to live large, carry a lot of debt, and rely on Medicare, Medicaid, and Social Security to take care of you on a rainy day. Party today, let the government take care of tomorrow.
Seriously, I believe in a safety net and I am proud that we have a damn good one in America. In fact, the amount of tax money distributed to Medicare, Medicaid, and Social Security each year is $2.5 Trillion. The Federal Budget is available for you to review on the Whitehouse Website http://www.whitehouse.gov/omb/budget. Please, read the budget. If you get your data in snippets from media and political speeches, you will be easily mislead.
The Global GDP is $70 Trillion. $3.5% of all money in the world goes to support the American safety net (Medicare, Medicaid, and Social Security). If our safety net were a country, it would be the 6th largest country in the world in GDP ranking. A short drop below the GDP of France and slightly above the GDP of Brazil. (See Wikipedia).
The US GDP is a hair over $15 Trillion. Of that $15 Trillion, the Federal Government consumes $3.8T. I do not know how much state government and sales tax consumes, so lets just forget about that for a moment. The US Federal Government consumes 25% of our GDP, and despite what you hear, it is not all Defense Spending.
I have been fiscally responsible my whole life. Saving money, working hard, trying to build businesses (my own and others). My goals out of college were clear: pay off my college loans quickly, stay debt free, become a millionaire. How pathetic.
The government teaching me that the sacrifices that I made in pursuit of my goals was less for my own gain, and the gain of my family - and more for the gain of others in society. It is good to achieve, as long as you do not achieve too much. It is good to save money as long as you don't save to much. Its fine to leave a few things for your heirs, just not too much.
Let the party begin!
By the way - this is not a political statement. I am an independent voter - I don't blame any political party an most certainly do not blame any President. There is very little that any elected official or group of officials can do about it.
ReplyDeleteI actually think that we are doomed. The only way to fix the problem is to get those who have little to take less AND ask those who have more to give more. If you raise taxes by 3%, you better cut medicare, medicaid and social security by 3%.
There was an excellent article this morning about the financial disincentives created when the young savers are told that their money will be withheld so that seniors can go spend: http://bloom.bg/PczeNs
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