Peter Navarro, Economics Professor, University of California; Irvine, recently wrote an article in his weekly newsletter entitled “California’s Budgetary Car is About to Drive Off a Cliff”
In a nutshell, he is asking the California voter to vote tomorrow to pass the various measures that would increase taxes for its citizens. To not do so, Peter says, would “raise taxes.”
Did you catch that? If you don’t vote for measures that will raise taxes, your taxes will increase!
Specifically he says that;
“Put simply, a failure to pass these ballot measures will result in widespread government layoffs and a dramatic cutback in government expenditures — including deep cuts in education, police and fire protection, prisons, and other essential services. “
So his answer is to keep government spending going and the status quo spending that got us into this mess in the first place.
Let me ask you something….if your family is in dire financial straits, do you cut back in your spending or keep things as they are?
Are employers across America cutting back on their employees salaries to stay in business or are they paying the same salaries? What is the difference between the employers across America and the California government? Why can’t government cut back like the rest of us?
You’ll find my reply to Peter’s economic nonsense (yes I realize he holds a PhD in Economics from Harvard) and his recommendation for voters to pass these measures below where you’ll also find some simple solutions the California government needs to take in resolving the budget crisis.
Please read his comments first by clicking his article above or here (3rd article down). I’ll let you know if he replies.
If you’d like to see what’s really going on in the economy, read my free white paper, “How Gold Investments Can Secure Your Retirement Years.”
My reply to Peter’s article;
You said; “This time the wolf will really be here — if California voters fail to approve all four measures on May 19’s special ballot.” and “The tragedy of all of this is that only the richest and most insulated few in this state will go unscathed if these ballot measures fail to pass.”
What you fail to understand is that the government spending, the high salaried employees of government and the lucrative pension plans are at the heart of what ails California. They are just trying to continue to live like kings and queens on the backs of the serfs.
And the “tragedy” is not that the “richest will go unscathed,” as we all know they don’t pay taxes because they know the loopholes to begin with, but rather that you think that not passing these various measures will result in “taxes will eventually have to spike to pay for all the mayhem that likely will ensue.”
So why should capitalist companies cut back the salaries of their employees and government be allowed to continue to pay the high salaries of those that protect us? Why can’t the entire realm of the country cut back during this economic recession? What do the kings and queens deserve that middle America doesn’t?
Taxes will be higher no matter whether the measures pass or not (and on a federal level, inflation). To simply vote for more taxes so they can live like kings and queens IS idiotic. To cut spending is what is needed. To cut these high salaries and pension giveaways is what is needed. To reign in big government is what is needed.
Government will always try to get what they can from the serfs. Now they are blatantly asking for it with these measures using the sympathy for firefighters and teachers as the ploy. It’s time for the serfs to stand up and just say no to the government they elect, not to the teachers and firefighters, but to their fiscal madness.
If these measures do pass (and 1F fails), you really think the economy will get better? You really think the government will do what is right for the people? How is adding more to (or the maintaining of) their coffers via the increased taxes these measures would bring going to solve the underlying problem? That type of thinking is what is truly a “tragedy.”
UPDATE: Professor Navarro’s Reply
I get all that. If the measures fail, there will be more economic chaos… world ain’t black and white…
Professor Peter Navarro
Paul Merage School of Business, UC-Irvine
Author, The Coming China Wars
It’s pretty black and white to the Austrian economists Professor.
Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.