The Best Way for Governments to Raise Revenues

At federal, state, and local governments, all revenues should be voluntary gifts. Governments should be allowed to pay for advertisements about what a great job they’re doing. But in collecting revenues, no coercion would be permitted.

Services not provided by government, if desired, would be furnished by profit-making enterprises or by voluntary gifts.

Citizens would give, all right; I certainly would. But the government sector of the United States would nevertheless fall from the current 38 percent of the Gross National Product to something like 8 percent. This is where it stood a century ago, and where it belongs today.

Killed by Prosperity

Almost everywhere in the world, prosperous people are having too few babies.

The fertility rate – the number of children produced by the average woman during her lifetime – is too low. To maintain the population, the rate must be 2.1. At 2.0, the U.S. is close. Northern Europe, at about 1.8, isn’t bad, but Southern Europe, including Germany, is under 1.5. India is a stellar 2.5, but China, hindered by a one-child policy, is only 1.6. Japan and Singapore are a disastrous 1.2.

The children of old-time farmers served as farm hands and counted as assets. But the children of prosperous urban dwellers are costly liabilities. For women, college degrees, full-time jobs, the pill, marriages later in life (or never) all create a dearth of births. As developing nations become prosperous, their birth rates, too, will fall.

Entitlement programs, including Social Security, face bankruptcy, because the benefits to numerous older beneficiaries are paid by too-few younger workers.

Human beings may eventually expire and be replaced by robots. By that time, robots will have judgment, common sense, and even a sense of humor. That’ll be quite a Darwinian twist.

U.S. Enforcing FOREIGN Laws!

A U.S. businessman imported Honduran lobster tails in plastic containers rather than cardboard packaging. For this violation of Honduran law, he was indicted and convicted by the United States and sentenced to eight years in a U.S. prison.

In importing wildlife or plants, the U.S. requires business owners to know obscure and highly technical laws of almost 200 other nations. The owners must also predict how the U.S. government will interpret those foreign laws. If the authorities think any of them have been violated, the owners are subject to criminal indictment.

Gibson, a U.S. manufacturer of fine guitars, imports wood from India used for fingerboards. Indian authorities provided sworn statements approving the shipment. Nevertheless, 30 armed federal agents stormed Gibson’s Tennessee factory, sent workers home, and seized 100 guitars and other property, costing the owner over $2 million.

Why? The agency interpreted Indian law to mean that the parts should have been finished in India rather than by U.S. craftsmen.

In America alone, there are over 4,000 federal criminal offenses. Call it the rule of law after law after law after law after law.

Student Loans Ruining Higher Education

Government’s student-loan aid is ruining higher education, to wit:

The interest rate, set by politicians, is too low, causing too much borrowing.

Grants and loans from a third-party (the federal government) make students and parents insensitive to education costs. On top of the flood of cash, schools have taken advantage of this to incur unnecessary costs and raise tuitions through the roof!

The number of college graduates exceeds the availability of high-level jobs. Over half of recent college graduates are unemployed or underemployed, but they’re still struggling to repay their loans.

Student loans induce too many unqualified people to apply for college. The portion of Pell Grant recipients who fail to obtain degrees within six years is 60 percent – yikes! 

Colleges should own the loans themselves. Defaults would cause the colleges to lose, not the taxpayers.

Instead, the Obama Administration has taken over the student-loan program completely, removing competition among creditors for the quality of service and making every problem worse.

Why Italy Stagnates

As an ambitious Italian entrepreneur, here are some of the government hurdles you face:

Two-thirds of your employees’ Social Security taxes are paid by you.

After hiring your 11^th employee, you must submit an elaborate assessment of every possible health and safety hazard to which your employees might be subject, including – get this – the stress caused by age, gender and racial differences.

After your 16^th employee, dismissing a staffer becomes nearly impossible. Plus, your employees then become unionized, requiring you to consult union representatives on many issues, including gender equality and the introduction of new technology. You must also begin hiring the disabled. (By your 51^st worker, 7 percent of your workers must be disabled.) 

After your 101^st employee, you must submit an elaborate report every two years on the gender dynamics in the company, including the dynamics in each production unit.

Certain exemptions ease the way. But the overall costs, include those of the applicable government bureaucracies, subtract over 47 percent from the average Italian wage. Since many costs are hidden, most Italian workers don’t know the total costs of their employment. 

No surprise that Italy’s unemployment rate is 10 percent. No surprise, either, that Italy is likely to leave the Euro.

These conditions are prevalent throughout much of Europe. Eventually, the Euro itself will probably disappear.