A Favorite Book

January 10, 2007

We all have favorite books, films, and foods. Books, films, and foods we always gyrate to when we need a treat, refresher, or to prove a salient point. I stumbled across a marvelous book several years ago in a Phoenix, AZ used book store. I paid $6.50 for it, and was glad to do it after thumbing through it for a few seconds, when it sank in as to just what it is. The book's title is "Barnes Federal Code." The sub-title is "Containing all federal statutes of general and public nature now in force." Copyright 1919, and published by Bobbs-Merrill Company of Indianapolis, Indiana. The pages are five inches across and nine inches high, and the book is three inches thick. Now imagine that.

All the cabinet posts, and all federal laws are encompassed in this book, dated 1919. Samples of chapters are, "The Congress, The President, Provisions applicable to all Executive Departments. The Post Office Department, The Army, The Navy, The Militia, Seat of Government, Indians, The Elective Franchise, The Public Lands, Internal Revenue, Coinage, Debts Due by or to the United States, Foreign Relations, Vessels in Foreign Commerce, Steam Vessels and Motor Boats, Federal Farm Loans, Education other than Military or Nautical, National Banks, Patents, Trademarks, and Copyrights,, Crimes, National Defense, etc. In all, forty chapters, which contain every single federal law in existence in 1919. 2506 pages.

Now think about 1919, if you will. We were just over a war, but America was whole. No new states were to be added until Alaska and Hawaii. Major cities were fine, and highways covered the nation, as did railways. Coins were silver, and dollars were backed by gold. The federal government was MICROSCOPIC, compared to today. Tariffs covered most of the costs of this microscopic federal government, and Washington D.C. contained it all. Today, federal bureaucracies have fanned out to the far reaches of Virginia and Maryland suburbs. The federal government has millions of employees, and this costs hundreds of billions of dollars each year to maintain. In the last few years, several new, expensive bureaucracies have been formed, with maybe a hundred thousand new employees. The people who examine your luggage before you get on the plane, alone are over 40,000, not counting the rest of Homeland Security.

When governments throughout history have grown, their respective costs have escalated as well. Escalated in costs, to the degree that taxes collected won't pay their expenses. Taxes can be raised only so much, and then there is a revolt. Revolts from outrageous taxation have happened over and over again throughout the earth's history. Taxes in America, I really believe, are almost at that point. If you consider how large the federal government has grown, compared to the total number of federal laws in effect in 1919, no wonder taxes are so high. The federal laws in force today, probably couldn't be contained in a box car, or several box cars. The more laws there are, the more lawyers there are to defend or prosecute for or against them, and the more courts that will come into existence to adjudicate them, and all of this is very expensive.

The nations which have taken out manufacturing and even telephone answering businesses from us, have microscopic governments and worker costs. When a worker in America makes $15 per hour, he will take home about $9 if he is lucky, thanks to all the taxes taken out of his paycheck. Then he goes to the store and pays a 7% sales tax, taxes on his phone, home, electricity, gas to heat with, state income taxes, and then another 40 plus cents on every gallon of gas he buys for his car. Taken as a whole, the taxes are really unbelievable. Some have said that after taxes are paid on property, delivery trucks, appliances, utilities, and worker taxes, just on manufactured stuff, (what remains that is manufactured here), makes the costs of the manufactured things double what they should be.

In China today, where it seems all we need and use is made, there are few taxes, few snooping bureaucrats, no minimum wages, endless deductions, regulations governing the workplace, and what a Chinaman or his family make, can be shipped to us at a fraction of the cost of what it would cost to make here. The cost of all the government that has developed since 1919, has made Washington D.C. the highest income city in the world, and not a single government employee is a productive person.

One needs to understand that just because one has a job and income, that job and income doesn't necessarily contribute to a nation's prosperity. When several million work for the D.C. Gang, and do the taxing, regulating, licensing, and in general making things difficult for others; these jobs and salaries are not contributing to a prosperous economy. When a man makes a car, grows corn, sells merchandise, or mines for gold and silver, he is a producer. When a man works for government, and throttles and harasses the productive worker, that government employee, at any level, is taking prosperity down, taking profits down, raising costs of producing, growing, selling, or manufacturing, and actually making business go to nations where there is little harassing, taxing, licensing, and regulating.

Banks and credit card outfits gladly pay the long distance charges and conduct American style English speaking schools in India, and get the job done for two bucks an hour. In America, the cost of the same services are five times that, and then the employer must put up with endless regulations and work place rules. Long distance call costs are a small increase over the two bucks an hour in wages an Indian makes. If we returned to the federal statutes in effect in 1919, there would be no jobs going to India, no manufacturing done in China, and that is not an arguable point. It is a plain fact.

Millions of gadgets and 'things' are made in China outside of the hundreds of factories which have sprung up of late. People make things in their hovels, by hand, and they end up in Wal Marts, just like the merchandise made in Chinese factories. No one can compete with this, other than by placing tariffs on goods to protect America, and Congress spends lots of time removing tariffs, as I have mentioned before, not placing new ones on things. Free trade? Attempting to compete with Chinese families living in dugouts with no electricity, running water, or any modern conveniences, and making gee gaws for sale in America, is impossible. Do I care for or want to level myself and my nation with that? NO. Let'em live that way, but let tariffs be placed on their stuff so an American can make the stuff. At the same time get the federal government off our backs, so that a wage paid can be taken home.

As federal laws have proliferated from the 1919 level, there are mandates which states, counties, and cities are compelled to fulfill, and those costs are paid for by state income, property, and local sales taxes. The federal laws proliferating, have a direct influence on state, county, and city costs, and therefore the taxes levied by these entities, which results in more costs to buy, grow, mine, and build. Public and even private schools must obey federal 'guidelines,' and this raises their cost, which is transferred to your property taxes.

So where does all this leave us in 2007? It has us paying huge taxes at all levels, as a direct result of the D.C. Gang growing like Topsy. Look at what federal laws there were in 1919, and compare it to today, and cry. Weep, gnash your teeth, and curse, while the D.C. Gang gets richer and more dominant. And as the costs go through the roof and taxes collected don't pay for it, even at the high current rates, they simply print more to pay the ever increasing costs. When the presses roll, the value of the buck slides, costs of everything go up in dollars, and us poor saps find ourselves in a higher tax bracket, even though we are living less prosperously each year. Some say our living standards have degraded so much because of taxes and inflation, that we are back in the 1950's and sliding more each week. True? At my age, I believe it, because I remember the 50's and 40's and 30's and they were better. If one was alive who could remember 1919, I am certain he would be amazed at how low we have sunk. Protect yourself.


January 10, 2007

Don Stott has been a precious metals dealer since 1977, has written five books, hundreds of columns, and his web site is www.coloradogold.com

A one-ounce gold nugget is rarer than a five-carat diamond.

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