EDITORIAL COMMENT

January, 2018

The Rich Richer; the Poor Poorer

Senator Bernie Sanders was right, when in the 2016 presidential campaign he said, "The rich are getting richer and the poor are getting poorer."  When I was a boy there were milti-millionaires.  Today there are multi-billionaires.

When I got my first full-time summer job cleaning furnaces at age 16, I was paid minimum wage - 90-cents per hour.  Eggs were 12-cents per dozen and bread was a dime a loaf.  Today (let's use $9.00 per hour because it's easier to do the math), the minimum wage is ten time higher; but average prices have gone up more than fifteen times.  That means that my 90-cents per hour bought in excess of on-third more than the minimum wage does today.  But remember, the rich do not get paid by the hour.  Most of their income comes from the return on their investments.  While that may lag behind duiring times of inflation, it eventually catches up and far surpasses the minimum wage increases.

Today we have a big push to increase the minimum wage.  That is important, because if we do not begin the inflationary process to absorb the tremendous increase in our national debt over the past eight years (it has more than doubled), the increased interest will topple our economy.  Over the next ten to twelve years, we will see the minimum wage increase to about $15.00 per hour.  But at the same time, inflation (the nastiest of all taxes) will have to rise from what costs $9.00 now, to $18.00 then - a loss to minimum wage workers in buying power of $3.00 per hour.  So, once again, the rich get richer and the poor get poorer.  Remember, the rich don't get paid by the hour.  Some have no regular income at all.  They make their mony from the return on their investments, which traditionally far outstrips the rate of inflation.

By-the-way, does anyone know what a trillion dollars is?  Follow this: If you had gone into business on the day Jesus was born; stayed open seven days a week and lost one-million dollars every day; it would take another 700 years before you would have lost your first trillion dollars (2,746 years to be exact).  I didn't believe it either, so I did the math myself.  And to think: we lost twelve of those during the eight years of the Obama presidency.

The national news carried a story last year stating that people retiring today will need 1.2-million dollars in their portfolios to maintain their standard of living.  The story projected that by the time Millennials retire they will need 2.7-million dollars to do the same thing.  That is what inflation does.

Well, who is at fault?  Blame the Bernie Sanders' Progressives for voting to spend more money than the country receives in tax revenues.  Blame the Hillary Clinton Liberals (as she calls herself) for continuously supporting more and more spending, above tax revenues.  But don't stop there!  Blame those who call themselves Conservatives, but then go to Washington and support budgets and approve programs which outstrip the nation's ability to pay.

What would happen to your family if you spenttwice as much as was coming in?  I don't even have to answer that question - you know!  But the governmen simply cuts its debt in half by cutting the value of the dollar in half - a luxury you and I don't have.  But when that happenes, you and I pay for it by purchaing items with devalued money previously earned at a higher value.  That is a tax - a terrible tax!

Liberals retort, "Well, we'll just absorb the overspending."  They're right!  We absorb it by devaluing the dollar through inflation; the most horrific tax there is.  It is paid for by the poor and middle class.  The wealthy come out smelling like roses.  Do the over spenders know what they are doing?  Of course they do!  They're not stupid!  But they respond to our demands by promising and proclaiming whatever it takes to get elected and reelected.  So ultimately, the buck stops with us, the voters.

I am well aware that many will reject this out-of-hand.  My challenge to you is: do the math.  It's really very simple.
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