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Savings 10 Years Down the Road or Groundhog Day?

As the government plays with their budget and also talks about tax breaks, we must consider all the ways we are taxed, most we never even notice. All along the chain, from the inception of a product, regardless of what it might be, we are taxed, and taxed, and taxed again.

Those taxes are not charged to us directly as the individual citizen so as we would notice the itemization of those taxes. But unless and until you consider that all of those taxes along the chain will be added to the final cost of goods and services paid by the consumer, you will not realize how well hidden the amount of money federal, state, and local governments receive. Additionally, the amount of cash flowing into the coffers of these governments are seldom even considered by the taxpayer.

Take for example the cost of a loaf of bread.

“Way back in 1975, Ronald Reagan commented that there were 151 taxes that went into the price of a loaf of bread, and that those taxes made up more than half of the cost. While much has changed since then, and I could not independently confirm all of the taxes that currently go into a loaf of bread, that quote is still true in spirit if not in detail.

Farmers may be eligible for subsidies, but they pay property taxes and income taxes. The trucker who takes the grain to market pays taxes for his license, his rig and his fuel. The grain elevator has property, employment, income and sales taxes. The miller, the bakery, the store and every other link in the chain has its own taxes as well, whether they are assessed on property, sales, income, wages, fuel or what have you.” (investopia)

While there may be no way to stop the hidden taxes, or maybe we should call them unnoticed taxes, they are in reality a part of what makes our government work. Copious amounts of money flowing in and out of government’s hands which we would hope would be used to fulfill essential responsibilities.

But as the political theater continues, we often miss some things that may well be beyond the understanding of the average taxpayer. We will be told things that those running our government want us to hear,things which will either get us on board or angry with the budgetary and/or spending process. We will be told just enough so as to help those in government to continue doing exactly what they want.

But as in all things, it begs the question; “is half the truth the truth?”

I do not have the time nor the ability to track government spending. But, I never see serious debt reduction, and I never see serious cuts in spending. I always see massive spending bills and I always hear just how wonderful those bills are and how they are always said to “give us savings 10 years down the road”. While that quote could be applied to Congressman Ryan who says it annually, many others say that as well. Since I have heard them say it for so long, I am beginning to wonder if we are in some sort of time warp or perhaps we are in a Bill Murray Groundhog Day scenario where we will never get to the 10 year savings point.

Will tax breaks to the rich help the economy or will it help politicians get more campaign contributions? Will tax credits to those who are not even citizens remain justified so that the voter base can be increased by one political party? Will highways to no where or other such pork projects be added to bills so that a congressman or senator can look good to the constituents, or will those highways bypass a particular community perhaps making it a ghost town in the years to come?

We can all come up with fraud, waste, and abuse examples that have occurred or are occurring over time. But one simple fact remains, government has responsibilities to perform and must get the funding to fulfill those responsibilities. Initially, those responsibilities were found in the enumerated powers section in our constitution. Of course today, we all know that government is more than just that, some things justified and others damned sure not.

But, for each and every one of us to sit here and discuss all the individual nuts and bolts of budget and spending talks without demanding that government live within it’s means and work diligently to reduce the debt, makes us somehow just puppets who are easily distracted. I think better of us than that.

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One Comment to Savings 10 Years Down the Road or Groundhog Day?

  1. Misconceptions and Facts: Lies and Truth About the Business of Modeling

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