Generally I like to publish articles in order, it makes sense? However, in this case I will throw caution to the wind! Wayne Vinson spent more than 30 years as a luminary at the IRS. Now retired, he has turned his efforts into books. His first one Tax Collectors And Other Sinners is a great read, a novel with a fabulous twist.
I like Wayne Vinson and have been picking his voluminous brain about all things IRS. He has been very gracious in answering my questions.
This article is a little different in that it does not directly talk about the IRS, instead, it talks about the financial health of the United States. The government does not seem to have the same financial rules as the man in the street. If I don’t pay my debts, bad things happen. If I opt to not make payments on my car. Or fail to make payments on my mortgage. I find myself without a car and without a roof over my head. I will also discover that no financial institution will want to make me a loan to replace the items. In fact, none will want to loan me money for any purpose.
This is a huge problem at a personal level, but imagine what it might be like at a larger level? I will let Wayne explain – Simon
If you’ve read the first parts of this, you know I think the United States is headed for financial disaster. We are 17 trillion dollars in debt and it appears that Congress and the President have given up on ever paying the debt back. They have not come close to even eliminating the annual fiscal deficit, which must be done before anything is paid on that whopping Federal debt.
So we will go on, borrowing immense amounts of money to pay our national bills, for how many years? I suppose until nobody will loan the Federal government any more money; or until our debt is so big that we can’t pay the interest on any more debt and still meet our other commitments. Or maybe it will happen soon, because Congress will not raise the debt limit.
What then? The mighty United States goes bankrupt. The president’s committee on deficit reduction thought it would be a disaster. So do I.
Who is to blame for this national financial fiasco? Certainly Congress and the presidents are. Remember their record over the past 61 years: just 3 barely balanced annual budgets, and 58 years of red ink which now totals 17 trillion dollars. That’s $17,000,000, 000, 000 more spent, than the government took in, during the past 61 years. That is a national disgrace.
We Americans have come to believe that America can do anything; pass any legislation, fight any war (whether we should be involved or not), give foreign aid wherever. We can’t. We are subject to the same rules that govern every one else. Rule one is, You should have as much income as you spend. For nations, income is taxes.
Alan Simpson, retired conservative congressman and co-chairman of the President’s committee on deficit reduction, doesn’t especially like taxes. But after the committee had done its work, Simpson declared that the United States must raise taxes as well as reduce expenditures, or we will go over the financial cliff. President Obama got taxes raised a couple of percent on taxable incomes over $400,000, so the top federal tax rate is now 39.6%.
I am in favor of raising the tax rate 1% on the lower brackets and 2 or 3% more on the higher ones. The country is in crisis and we all should help.
I am an ordinary guy with an ordinary income, and I have a hard time understanding the opposition to higher taxes by rich people. I would love to have a taxable income of $1,000,000, and have to pay about $385,000 tax (the approximate total of state and federal tax). That would leave me with $615,000—nothing wrong with that.
Americans who have the biggest incomes complain that they pay most of the federal tax. They do pay a huge amount, but they also have a huge amount left, to buy houses, cars, and educate their kids.
Of course we must reduce federal expenses. I just read in Time magazine that the Democrats have not made a federal budget for 4 of the last 5 years. That stinks for sure. However, if they had made budgets, the House Republicans would probably have never let it through for a vote.
Obstructionism, party ideology, a complete lack of cooperation, is what we are getting in Congress.
Much of the legislation that has taken place over the years was for a good purpose: Medicare, Medicaid, The affordable Care Act, were all created to help Americans. Unfortunately, the actual cost of Federal programs always greatly exceeds estimates. Bureaucracies pad costs, the Military included.
The problem we have to solve is which federal expenses should be eliminated and which can be reduced. Congress has talked about dropping Saturday mail delivery, a relatively easy thing not involving many employees, for about 2 years. Nothing has happened.
As long as we have career politicians—congressmen for life—our debt problem will not be solved. Because, the great majority of them are gutless, much more interested in being reelected than in doing the right thing for America. What happened to the idea of term limits for Congressmen?
Wayne Vinson was an IRS agent for 33 years and the author of a real thriller, Tax Collectors and Other Sinners, the story of a psycho killing tax collectors. It is available at amazon.com as an E-book or soft cover.