To the average person living in a democracy, capitalism, and the social changes it forges, rarely is given much thought. And yet our very lives, not to mention our livelihoods, are so wholly connected to our capitalistic economy, that the line between people and business has become blurred, and the properties of one has been usurped by the other. Private enterprise is the engine of our economy, but it also the string that ties us all together. Everything we buy is supplied by a business. Every paycheck we earn is supplied by a business. Every facet of our culture is connected to another by a business of some kind or another. It is this omnipresent aspect of business that makes it so powerful and yet so invisible at the same time. We would like to believe that businesses exist to offer a quality and fairly priced service or a product while making a modest profit for the owners and employees. We would like to believe that companies have the best interest at heart when it comes to their customers and their employees. We would like to think of business as an extension of the human traits we most admire, but the reality is that business in today’s world is hardly the altruistic picture we paint for ourselves. The success of capitalism in the West, and especially in this country, has instead made its higher echelons drunk with wealth and power, and unfortunately, capitalism doesn’t make a very fun drunk. Business, rather than compliment society, now tries to rule it with an iron glove.

The problem isn’t really with all business, per se, but rather with the evolution that has transformed business from the small or medium sized company into the multi-national behemoth that dominates the business landscape today. The legal rules that separated business endeavors from their founders and created the corporation as a separate legal entity, akin to an individual person, have bestowed upon these large companies many of the rights that are constitutionally guaranteed to us as individuals, even though the businesses are not human beings in any way. But because corporate capitalism uses its own considerable wealth to advance legislation, often times these businesses are not held accountable as an individual would be. They are receiving all of the benefits without bearing any of the responsibility. Furthermore, through their legislative access (allowed them by means of political contributions by a variety of means, both legal and extra-legal) they enjoy access to policymakers and exert influence on policy and laws without having any accountability to the general public, a practice that not-so-subtly bypasses the representative system guaranteed by our Constitution. This is wrong, and to stop this corporate subversion, we need to change our political finance laws as well as our interpretation of the rights of businesses. To what extent should a corporation’s activities be separated from those who actively manage it?

Does a business exist merely to produce profit or is it more of a cooperative effort between the business leaders and the employees to ensure mutual success? The answer should be, “Yes.” Obviously, in order for a business to be successful, it has to be prosperous at some level. It must earn enough money to pay for all of its materials and employees and utilities. And if the goal of free enterprise is to provide a materially wealthier lifestyle for the entrepreneur, a business must also generate an adequate profit for the owner. But since the success of a business is directly related to the effectiveness and expertise of its employees, business leaders need to find a balance between acceptable profit and outright greed. Most employees enjoy working for a successful corporation if they see the company returning some of its profit to the workers through benefits or raises or other perks. Yet increasingly, large businesses are decreasing their investment in their workers through reduced pension plans or decreasing health insurance coverage, or worse, through down-sizing and relocation. It’s hard to blame them with costs for these programs skyrocketing in recent years, but in many cases, corporate profits are increasing at just as rapid rates, yet the employee cuts continue unabated as the shareholders profits rise. Reducing the costs of doing business should be a top priority in the area of economic reform, and I’ve already discussed ways to significantly decrease or eliminate the costs associated with retirement and health benefits. (See The National Whole Life Pension Plan and Affordable Health Care Does Not Mean Free Health Care) But any reductions in the cost of doing business should be translated into lower costs, better products, higher wages or any combination of the three. If society and politics work to reduce the costs to business, we should expect business to reduce their desire for enormous profit margins and settle for merely large or even modest profit margins.

We also need to take a look at certain areas of business that generate large profit margins simply because the products or services rendered are necessities for living in this modern world or are mandated by law or nature. A prime candidate for scrutiny would be businesses in the energy industry. Modern society requires a fair amount of energy, either as electricity or as gasoline. And although we derive our electricity from a variety of public sources (hydroelectric plants using public river ways for energy, wind farms using public air, or nuclear generators using public minerals and dollars), the costs to the public are anything but consistent. In a capitalist system, these fluctuations are attributed to supply and demand, but recent shenanigans in this sector of business have shown us that this isn’t necessarily the case. Manipulation and false scarcity have been used to increase the costs to the consumer for no reason other than greed, and the energy sector isn’t alone in this. (For ideas on energy reform, read The Future of Energy) Insurance companies, whose products are often mandated by law, and medical companies, whose products are mandated by nature, also engage in these kinds of manipulations. Perhaps returning some of these businesses to public control, or at least more stringent public regulation is finally in order. After all, there are plenty of other ways for people to make their fortune without having to gouge consumers for the very necessities of modern life.

Corporations, because they are also the main source of employment for many, also enjoy certain legal protections not afforded to individuals. This is done under the assumption that a large business is too valuable, in terms of tax revenue and as an employer of the people, to hold accountable for many of its mistakes. We see the error of this thinking all around us, but usually only learn of it once the real damage has been done. Think in terms of environmental pollution or sealed out of court settlements. Think in terms of hushed up research documents in the rush to market the newest medicine. Think in terms of massive product recalls due to cheap or defective parts. All of these issues tend to diminish the image of business in the eyes of the public. Yet our politicians support these loopholes as if they were part and parcel to the way the world works. As individuals, we expect accountability from each other. We expect honesty and integrity. Why don’t we demand the same of corporations? Why don’t our politicians? The truth is that the corporations don’t care what we think, because they’ve paid for the politicians to keep things as they are and our apathy at the voting booth affirms their assumption that we don’t care or can’t see what is happening. Corporations need to be held accountable for the products they sell. They need to b
e held accountable for the messes they make. They need to be open and forthright when they discover a faulty product. And they need to put safety and integrity at the same level of concern as they put profit.

Finally, businesses, both large and small need to have greater accountability to the public (if they are a publicly held corporation) or to their employees and customers (if they are a small or medium business) in both their financial dealings and their human efforts. Employees should be paid a living wage, (which becomes more possible with pension and health care reforms) be offered a fair amount of leave for illnesses and vacations, and be given the opportunity to grow with the company to their ability and aspirations. It is the best interest of any business to have happy, productive employees, and this can be achieved without seriously harming profit. Simply offering more flexibility in scheduling and more reasonable expectations from overworked staffers would be a start. After all, there is only so much money a person can enjoy, and no one wants to be worked into insanity. The benefits derived from making other people’s lives happier can outshine the brightest diamond, and they provide more goodwill towards a company in the long run.

I don’t think of business as evil, or capitalism as the enemy, and I don’t think money will automatically turn you bad. But it is plain to all who care to look with an open eye that the modern constructs of business in society are leading us back to a place we’d sooner keep in the past. Unless we make an effort to drive the influence of corporate money from our politics, unless we begin to demand honesty and integrity from our business leaders, and unless we teach the future leaders of business that people matter more than profit, we will see a return to the days of indentured servitude as the costs of living continue to outpace wages because our poor, rich corporations aren’t clearing enough profit.

The curtain has been firmly pulled back now and Americans of every stripe are finally facing the facts of what we’ve all known but ignored for so long, namely that our government is a farce of what it pretends to be. The machinations of the corporate oligarchs and their puppet politicians have been revealed for what they are- nothing less than an attempt to squeeze every last dime and ounce of life from the citizens who make up this great country in an effort to fill their own pockets and corral power among the corrupted minority. The disaster left in the wake of Hurricane Katrina has exposed our local, state, and federal governments for the frauds that they are, and as they wallow in the filth of what was once New Orleans, pointing fingers at each other while the nightmare rages on for hundreds of thousands, the American people are finally saying enough is enough.

At every turn, our government leaders have let us down, and the actions unfolding in the aftermath of the hurricane only exacerbate their ineptitude. But the disastrous results in the Gulf Coast are not just due to the awesome power of nature. The death and destruction left in Katrina’s wake was largely preventable had not our political institutions not been so wholly corrupt and unaccountable to the citizens which they purport to serve. From the inability of local officials to fight for the protective measures that could have prevented the wide scale devastation, to the lack of quick and decisive action by state governments to the paltry effort played by federal agencies and leaders, it has become clear that our government is being run by a bunch of corrupt thugs and pretty imbeciles who answer only to their corporate benefactors, self-serving union leaders, and special interest lobbyists. The welfare of the American citizens who pay their salaries and their pet project costs are inconsequential to the vast majority of politicians at all levels of government, whose only real aims are to stay in power, enrich their own bank accounts, and secure lucrative post-governmental careers.

The Hurricane Katrina Relief effort has taught us many important things, and if we do not heed the lessons that have been so blatantly laid out before us, we deserve the worst that these men and those who follow in their footsteps can dish out. So what exactly are some things we have learned?

The number one lesson to take from this disaster is that when push comes to shove and the walls are caving in, we are on our own. Despite our illusions that our government is working to protect and defend the people of this country, the sad truth is that the people we have put into positions of leadership are neither equipped nor inclined to handle the job. We’ve been electing people not based on their own sound Common Sense and clear-headed devotion to public service, but instead on whose sound bites get the most airplay and who can repeat the hot button policy statements the loudest. Politics has become more of a popularity contest between corporate show ponies whose own depth of thinking stops at the donors checkbook than a real forum for civic-minded individuals to give back to their communities through honest public service. We no longer elect men and women with vision and competence, and the result is that we have no one to count on but ourselves in an emergency of catastrophic proportions, while our system and its policies have tied one hand behind our backs before we even start.

Entrenched in their own bureaucratic morass, government officials have become completely impotent to deal with the large issues of the day and dubiously corrupt in their handling of day-to-day operations. Evidence of this total incompetence can be seen in city halls and state legislative bodies throughout the country. State and local economies stand on the brink of bankruptcy even though billions of dollars pour into the public coffers annually. Where is this money going? It’s obvious that it’s not being used on public infrastructure, education, or human advancement. Elected officials have now deigned it imperative to spend millions of dollars studying problems that have clear Common Sense solutions. This drives up the cost of everything while accomplishing very little, save for the enrichment of think tanks, consultants, and lawyers. Legislation and court rulings are now designed to benefit the business class over the working class at every turn, obfuscated in legal jargon and presented in sound bites that keep the public dumbly appeased. Our own blithe acceptance of this as “the way things are done” is nearly as shameful as those who perpetrate this illusion, but the results of our apathy have been shown to us in spades. We now face a choice: change the people who run the show or sit by and watch the American experiment of freedom and security and prosperity dissolve before our eyes.

The second important lesson we can take from this disaster is that on an individual level, most Americans will band together to help those in need when the government will not. Indeed, our charity as a people has never been in question. Attending a fundraiser for hurricane victims recently, citizens in my community donated over $300,000 in a one-day “spare change” drive. But the dichotomy between who we seem to be as a people and who we elect to represent our interests is difficult to understand. It is as if we have been under the assumption that our generosity is a shared ideal, forgetting that for those who hunger only power and profit, such concepts as compassion and commitment are handy only when the cameras are rolling and the microphones are on. Indeed, the consolidation of political power by the ruling class has effectively locked out the average citizen who would eagerly endure the hard task of providing the tax paying citizens with honest, effective, and accountable leadership and governance in return for the privilege of living in a country as free and prosperous as our own. The response by our government, local, state, and federal, to this hurricane disaster should finally make us realize that we are not electing mirror images of our own compassion and Common Sense, but just caricatures of ourselves. It is time to return to the tasks of politics average citizens with no ulterior motives but to serve the common good and then return to private life. Let us turn our charity towards ourselves and our political system and demand accountable and competent government.

In the past week, I heave heard tales of food and water being held back from survivors because of bureaucratic red tape. I have heard excuses made for inaction due to the need to follow protocol. I have heard stories of courageous and generous citizens turned away from helping others. I have heard stories of human indignity, societal collapse, and racial prejudice. I have seen pictures of crying senior citizens, and back slapping politicians. I have heard survivors crying over lost family members and heard CEO’s crying over lost profits. And I have heard of schoolchildren emptying their piggy banks, wealthy entrepreneurs paying for rescue efforts, and rescue personnel volunteering to help out. In short, Hurricane Katrina has brought out the very worst and the very best that is America. It has exposed our political institutions for the leaderless, corrupt, ineffective monsters that they have become, that we have let them become. It has exposed our politicians for the guileless, indecisive, corporate pigeons that they are, that we have let them become. But it has affirmed our basic individual goodness as a society of people at large through our efforts to help our neighbors, putting to question the claims that we are too divided to solve our real problems.

There are those who will continue to defend the government, or portions of it, and its performance during this natural disaster. They will blindly continue to hold as gospel all that the politicians tell them (or allow them to be shown on the television news.) I would hope that these people would fin
d themselves in the minority in light of the clear failure of all levels of government. But for those who would insist that this government is doing its job to keep Americans safe and prosperous and free I ask a simple question: Which is more encouraging for our enemies to see: large groups of peaceful war protestors or massive government impotence in the face of disaster? Because beyond anything Mother Nature can deliver upon us, our greatest threat is still from other human beings. They are more devious and less predictable than nature will ever be. If our government can’t even drop bottles of water to stranded citizens, how can we really think they are protecting us from the real enemies of freedom?

Now that we have clearly seen the results of a government gone awry by way of corruption for profit, now that we have seen what awaits us all in times of dire need, now that we understand what the policies and practices of decades of cronyism politics has wrought, we must make the most important decision we could make. We must choose to change the way things are. We must reject the false divisiveness of both major political parties, actively seeking non-affiliated Common Sense candidates to replace the corrupt ones we now have. We must give our political dollars to individual campaigns, not to established PAC’s or party coffers. Starve their machines and you starve their idiocy. We must put people in office that will change the way things are. We must challenge the system from within and purge it of its corruption. We must support with our time and with our dollars those who would show true leadership, doing what a government must do: no more, no less. We must prepare for this now and make a change or the blame for our certain despair will be our own.

The outpouring of assistance from everyday American citizens and small businesses is almost enough to quell the anger that has been directed towards our government in their complete lack of effectiveness in dealing with this disaster. Yet were it not for the generosity of each and every one of us who has been touched by the plight of the hurricane survivors, many people would still be stranded in the city of New Orleans and elsewhere on the Gulf Coast. With over $200 million in financial donations and scores of hard goods being sent to the Gulf, it looks as if things are finally, slowly, taking a turn up in this ravaged region of our country. Yet despite this initial outpouring of compassion and aid from the citizens of America, there is a long road ahead for those who have lost everything in this hurricane. Our efforts are only just beginning. But as the days turn into weeks, we must again turn to our government for help in dealing with this ongoing crisis. And as ineffective as they have been in the initial stages of dealing with this tragedy, we’ve no choice but to hope they take strong steps to put things back on the right course.

As the evacuations begin to see an end, and as food and water and other supplies begin to reach those in need, the next most important task is to find housing for the hundreds of thousands who have lost their homes in this deadly storm. While the opening of large sporting stadiums and convention centers in Texas and elsewhere provides an immediate remedy, it can hardly be a long-term solution to the problem of housing the newly homeless of our countrymen. Private citizens recognize this and have been offering shelter in their own homes to families displaced by the storm. But the sheer numbers of American refugees makes this a solution for just a small portion of the survivors. If these people are to regain any sense of normalcy in their lives while the reconstruction of their homes and towns are completed, they will need to return to a more normal standard of family living. The opportunity for government to make a real difference is now.

The first place to look would be areas that have existing buildings, homes, and infrastructure available that is not being utilized. Such places can be found around the country in the shape of closed military bases. Since 1988, nearly 125 major military installations have been shut down as various administrations decreased the size of our military. Many of these bases could be converted into temporary towns for those whose homes were destroyed by Katrina. Those that were previously permanent duty stations have a variety of housing and dormitories that could offer more normal shelter than a football stadium. The bases were likely equipped with stores, banks, medical facilities, and school facilities, and other basic infrastructure. With some minor maintenance, many of these former bases could be converted into mini-towns in a short time. This type of housing solution should be implemented immediately at no cost to hurricane victims.

A second housing possibility could be offered by the hotel industry, with government providing tax credits to participating hotels and motels. Simply put, large chain motels could set aside up to 25% of their available rooms and offer them to small families or single people at no cost. Small or independent hotels and motels could be encouraged to participate through even more generous tax credits to increase the total number of available rooms. In many cases, this might be a win-win situation for the hotels, the government, and the newly homeless. As fuel prices continue to rise, fewer families will be taking to the roads and staying in hotels simply due to a decrease in their personal finances. This could lead to a profit loss to the hotel companies, which would be offset by the tax credits. Government wins too by having fewer refugees to find housing for.

The problem of an increased population in cities that absorb thousands of new residents can also be dealt with. Take a drive through your town and count the number of vacant commercial buildings you see. Through a combination incentive program of tax credits and remodeling assistance, these buildings can be converted into schools and additional living quarters. Local governments should reduce or greatly streamline some zoning restrictions and enact temporary zoning waivers. The amount of construction for the conversions could also put able bodied citizens back to work in some capacity, allowing them to earn a living and reduce the necessity for public assistance.

The problem of housing isn’t the only thing facing hurricane victims, though it is the most pressing. Also looming in the near distance is the recognition of the huge financial losses faced by businesses and citizens. Already, some mortgage and lending companies are instituting a 90-day period of forbearance on mortgages and other credit debt. It’s a nice gesture, but wholly inadequate. To begin with, at least 75% of the homes in New Orleans and other hard hit areas have been completely destroyed, if not from the gale force winds, then from the flooding. In addition to the homes, businesses have been lost and nearly all forms of industry, leaving most of the survivors homeless AND unemployed. Do the lenders really believe that in three months time, these people who have lost everything that they own will be able to start remaking mortgage payments on a home or business that for all practical purposes no longer exists? Previous disasters have shown us that insurance companies drag out their claims for months and years in some cases, leaving these folks no real option but to have the banks foreclose or try to declare bankruptcy. Foreclosure stains ones creditworthiness, but in this situation, may be the best choice for former homeowners since their property is uninhabitable anyhow and the eventual insurance payout (if it ever comes) will likely go to the banks anyhow. Either way, the final result is a large group of citizens living in donated, temporary housing, struggling to find jobs to pay for their food and clothing and assorted necessities, with nothing left to show for their previous efforts but a pile of debt.

A better solution would be to enact a special law that allows hurricane victims who have lost homes, possessions, and businesses a grace period from repayment for 12 months. Interest will not accrue during this period and the overall balance will not increase. An automatic 6 month extension would follow if necessary which in turn would be followed by a repayment schedule that had a low interest rate and minimum payment according to each persons financial ability. Insurance payouts for damage claims should be mandated to commence no more than 45 days after the end of evacuations. In paying these claims, insurers should pay lenders 75% of the policy coverage and 25% to the policyholder. This provides survivors an opportunity to get a jump start on rebuilding their former lives by putting a little cash in their pocket. Again, tax credits for these one time measures could be offered to offset some of the financial loss to businesses.

Finally, the task of sending supplies to the hundreds of thousands will not end when the headlines are removed from the front pages of our papers. It will be weeks and months before those affected will begin to regain employment and stability in an effort to rebuild their lives. This holiday season will be especially tough. We must keep up our efforts to send things that we usually take for granted. Clothing, bathroom supplies, school materials…the list goes on and on. The convoys of goods leaving from towns all over the country must continue with the local governments and charities establishing an effective collection and disbursal protocol that ensures goods get to the people who need them with a minimum of red tape and also creates an encouraging and gracious atmosphere for those who make the effort to donate.

The challenge presented to us by Hurricane Katrina has expo
sed the façade our government has so carefully built. The initial efforts at all levels of government from the local to the federal levels, has been utterly without real leadership up to this point, and feelings of anger and resentment are running high. There will still be a day of reckoning on those issues, but quick action in dealing with the problems listed here could alleviate some of that anger, leaving way for careful and conscious reform in the near future instead of divisive witch hunts from both sides of the aisle.

Feelings of helplessness tonight have turned to frustration and anger as I watch the news channels and see the failings of our corrupted political system. While Congress waits to approve money for aid to the victims of Hurricane Katrina, people are starving on the rooftops of New Orleans. While President Bush strolls back from a lengthy and undeserved vacation, children are being born in the filth and sewage of a flooding city. As oil executives giddily see their yearly profits engorge from ever-increasing gasoline prices, desperate people are shooting at each other to protect what little they have left. And as the entire governmental system from the local to the national level sits on its collective hands, America sits by and wrings her hands and sends electronic donations to their favorite charities.

The meteorological catastrophe that was Hurricane Katrina ended 4 days ago and counting, and our brothers and sisters are clinging to life, abandoned by the very system that kept them too poor to get out of town. Hundreds of thousands have lost everything they had. Tens of thousands are lacking water as you read this. Thousands are already dead. America- our government will not help these people. We must step up to the plate.

This disaster was preventable, and our government must be held accountable for its massive breakdown and failure. Our businesses must be held accountable for their creed of profit over people. They share as much blame for this nightmare as Nature does. But the time for pointing fingers is not now. We can change our government, and in the aftermath of this disaster, I think we must, but that must wait for now. Politics must be put aside and Americans of all lines of thought need to really step up. Donating money is well and good, but the charities move slowly and these people are running out of time. We must act now.

The greatest need is for food and water to those people who are stranded in New Orleans and other Gulf Coast cities. So let’s get it there. In every city in every state, a local trucking company or public moving van rental company should donate the use of their trucks to deliver necessities to the affected areas. In every city in every state, we need retailers (like Wal-Mart, the richest company on the planet) to donate food, water, diapers, medicine and the like until the trucks are full. In every city in every state we need gas companies to donate the fuel to drive these and other rescue vehicles to the Gulf Coast. Employers in every city in every state need to release some employees to load trucks, drive trucks, and offer aid. These employees should not have to worry about losing their jobs, and if possible not lose their pay either. And we need people, everyday people who will drive and load and help. Above all, we need for businesses to forget about their profit margins for a few weeks or months because people are dying. If it will help loosen the purse strings, all levels of government should allow for tax credits for all donated time and goods, but any company who cheats the deal should be fully prosecuted. (So keep accurate records please!) We need people with boats to tow them to New Orleans and help evacuate stranded people. And of course, continue to raise funds and give to the charities. They will need the help once the emergency of death has been resolved.

Americans pride themselves on being generous to those in need of help, and the monetary donations so far bear truth to that claim. BUT OUR GOVERNMENT IS FAILING THESE PEOPLE AND LEAVING THEM TO DIE! America’s citizens must help each other out. I know everyone can’t just drop everything and go, but we can all do something. Business and Industry likes to tell us in their ads “It’s About the Family” or “People Come First.” Well, it’s time to put their money where their mouths are. One truck from each town in this country is all it would take. If we start loading today, we could have people there by tonight. And if the businesses won’t help, start a collection in our neighborhoods and pay for it ourselves, and when this is all over, we’ll remember who really cared about America and her people.

For many, we will already be too late. But there are thousands more who need our help. We can’t continue to sit and watch from our living rooms as people slowly dehydrate and die. Because no matter where you live in this great country, the next disaster could happen to you or your friends and family. And we obviously can’t count on this government to help us out. We must act now!

You can begin organizing these efforts on your own in your town. There is no need for a national umbrella group to spearhead this effort. Send this letter to your local paper, or radio station, or TV station. Take it to work and to businesses that have the supplies needed right now. Even if you can’t physically go to the Gulf Coast to help, you can help get the ball rolling. Our brothers and sisters are crying for our help. Let’s not fail them like our government has.

It is often said that the only things you can really count on are death and taxes. Of the two, death is probably easier to accept. Death, at least, is fairly applied to everyone. Taxes, on the other hand, are a complicated, unequal, seemingly arbitrary and often manipulated endeavor. And while we all can accept the fact that taxes are a necessary component of any effective government, there is much room to argue about how government acquires them and how government uses them.

When we talk about taxes, most people think immediately of the income tax. Perhaps because we have to deal with this tax every year in such an obvious way, the income tax is the one that gets the most lip service from the politicians. But the income tax is just one of many taxes we pay each and every day. Some of these taxes, like the income tax, go into government general funds and get budgeted to pay for services and administration. But most of the taxes imposed on us are use taxes or special purpose taxes, whose use is supposed to be concisely directed at its inception.

Gasoline taxes, for instance, are supposed to be used for transportation related projects and maintenance. Social Security taxes are supposed to be used for the national retirement program. Unemployment taxes are supposed to create a pool of funds to assist out of work citizens. Then you have property taxes, which usually are earmarked for schools and local public emergency services, and sales taxes, which go into the general fund or have an intended recipient, and on and on and on. Finally, you have the hidden taxes imposed upon us by our government’s bureaucracy, disguised as filing fees, license fees, permit fees. When you add all these taxes together, you would think that the government’s vaults were bursting at the seams, yet somehow we’re beyond the verge of bankruptcy and still spending money we don’t have.

Most Americans don’t really mind having to pay taxes. We understand that in order to get the things from government that we demand they provide, we must all share the burden of paying for those services. What really angers us though, is the obvious waste, corruption, diversion, and outright theft of our tax dollars at the hands of the people who are supposed to protect our precious dollars and us. And equally in our wrath, are the handfuls of corporations and millionaires that exploit an over-complicated tax code and weasel out of their share of the burden.

One of the reasons for the creation of our nation, for our fight for independence from the monarchy of England over 220 years ago, was the issue of taxes. Back then, the colonists had no say in what was taxed, how much it was to be taxed, and when they had to pay the tax. None of the taxes collected by England were used to improve the lives of the colonists, but instead were returned to the crown for its own enrichment. Finally, the colonists revolted, and history tells us the rest.

In establishing their new national government, the first Americans gave their own and future leaders the limited ability to collect taxes from the citizens to pay national debts, provide for common defense and general welfare. They were both specific and at the same time vague about what the taxes were to be used for, and laid out no collection plan other than to say that “all duties, imposts, and excises shall be uniform throughout the United States.” (One hundred thirty years later, Congress added some clarification, giving the government the power to collect income taxes to fund government services.) Following this pattern, state governments created their own tax systems for their costs, and counties and cities followed suit.

What has emerged is a system that is over-lapping and wasteful. It is a system that is filled with special favors, loopholes, meaningless restrictions and complex formulas. Adding further to the madness is the lack of oversight and accountability to the public and the seeming lack of concern by that same public. We now have a system that rewards tax dodgers by giving them bigger tax reductions. We have a system that is continuously plundered by corporate political donors through their spineless, bought politicians. And the result is that we now have the most complex and corrupted tax system in the world.

I’ve talked before about the price of freedom and how each of us has to earn our freedom each and every day by giving back to our community and our country. Paying our rightful share our taxes is a very important and necessary part of freedom. Equally important is ensuring that our elected officials are using those tax dollars in the most economical way while achieving all that we demand of them.

In order to create a more fair, less duplicitous, and more accountable tax system, we need to first redefine what we want from our governments, or rather, what each level of government should be responsible for. We must stratify the duties of national, state, and local governments and eliminate the waste. Why do we need emergency services at all three levels? Why do we need prisons at all three levels? Why do we need environmental committees, conservation committees, and scientific and medical research spending at all three levels? Why can’t each governmental entity be responsible for certain aspects of societal needs? And then, let each government create and collect a fair tax to pay for the costs of providing that service.

For example, the federal government maintains, trains, and regulates a national police force. Their job primarily consists of catching bad guys and putting them in prison. Each state, county, and city also maintains, trains, and regulates a police force, doing the same things as the national force. Each entity has its own costs, rules and forms. But really, they are all providing the same service. Often they work at odds though, trying to out-do each other instead of working together. This is how we spend of our tax dollars. Paying multiple agencies to do the same job. (Ideas for reform can be found throughout the essays on this site. For thoughts on legal-law enforcement reform, see essays published between 1-18-05 and 2-3-05, available in the archives on this site.)

We must realize that in order to have a more accountable government, we must be willing to make some major structural changes. We have to be willing to put leaders into office that will lead the charge. We have to be willing to fully pay for what we demand and demand accountability for what we pay. And we must create a system that is fairly applied.

That last part is really the tough part. How do we decide who pays what tax? A use tax seems fair, as it is used to fund something directly benefiting the user of the taxed product. Therefore, all who use it and benefit from it pay for it. (In some sense then, all taxes are use taxes, since we all use government in one way or another.) Perhaps by breaking down the costs of services we could derive a per person cost. But that isn’t fair to someone barely making enough to survive, since more of their money would be spent in taxes. Perhaps then a sliding scale, similar to the one we have now is the better way to go. But then we have people paying for things they will never benefit from.

Obviously, we can’t please everyone all the time. What we need is a system that combines the fairness of use taxes with the proportionality of sliding percentages and is apportioned effectively through the three strata of government. We need a simple tax code that explicitly specifies the taxed item, the type and cost of the tax, and the reason for the tax being collected. We need a tax code that does not favor one individual or corporation over another by providing special loopholes. We need a tax code that allows strict public oversight of expenditures and serious penalties for misusing tax funds or diverting them to questionable activities or projects. We need a tax code that reminds us that our tax dollars are necessary a
nd well spent. We need a tax code that is connected to the spending process to ensure a more balanced budget. We need a tax code that restricts our government from wastefulness and greed.

As it stands now, we’re not getting what we pay for. We will all benefit from a more rational tax system, because less money wasted means less money needed, means less money collected. Or, less money wasted, means more money available, means more projects and programs. Either way is fine, as long as the American public finally stops getting the shaft.

Sometimes, bad things just happen. It’s a fact of life, plain and simple. Houses burn down. Stores get robbed. Cars get wrecked. People get cancer. In each of these scenarios (and any number of misfortunes) there is likely to be emotional, physical, or material damage. There is also a negative financial impact that can run into the hundreds or thousands of dollars. Such unexpected expenses can often spell disaster for average, middle class citizens, but thanks to a concept called insurance, the financial strain can be somewhat lessened. Insurance originally developed in ancient Babylonia to protect shipments of goods, whereby traders would front the funds for caravans and get paid back with interest upon safe delivery of the goods. Later, the Romans would add another wrinkle through their burial clubs; soldiers paid a fee and in return would have their funeral costs paid as well as a little something for their survivors. Today we have insurance for just about everything under the sun, from house, health, auto, and life to wage insurance, liability insurance, even product insurance and pet insurance. Insurance has become big business, earning $17.3 billion net income industry wide in the first quarter of 2005 alone.

Insurance is a semi-socialist endeavor that pools the money of a lot of people to pay for the misfortunes of a few and the peace of mind of the rest. But all too often, insurance is viewed as a type of public lottery system that can deliver an unexpected, and in many cases undeserved, windfall. What started out to be a safety net program for infrequent yet expensive life events has instead become wrought with fraud and greed, perpetrated by both the consumers and the insurance companies. Companies seek to maximize their profits by minimizing their claims. Consumers retaliate by inflating their claims to increase their recovery. And companies in the middle, those who ultimately get the cash for fixing the broken whatever, play on both sides of the fence. This mutual distrust has spawned a regulatory and legal labyrinth that ultimately costs more for the consumer while providing less. It’s an environment that has pitted the company against its customer, greed against good.

Insurance is a very good idea that has become altogether too complicated, so perhaps it’s time to simplify things, and in the process eliminate the opportunities for fraud so that we can keep costs lower for everyone, while providing the important coverage that everyone needs. Let’s look at the big four- health, home, auto, and life.

The first one, health insurance, is the most expensive and is filled with fraud. Rather than working to ensure that patients receive the care they need, health insurance companies are driven by the profit line in an industry where costs spiral out of control. Take a look at any hospital surgery bill and you’ll find single doses of aspirin being charged at several dollars a piece, in some cases over $10 a pill. And this example is among the smallest but most numerous type. (Consider the fact that many hospitals receive these medications at much lower prices, but charge these ridiculous sums to recoup costs associated with treating uninsured patients.) Notwithstanding the clear inappropriateness of accountants dictating medical care, a system that allows itself to be abused in such a way is hopelessly broken. The good news is that we could eliminate the need for any kind of health insurance by reforming our system of medical care in this country. (See Affordable Health Does Not Mean Free Health Care) Health Insurance companies will be loathe to adopt most health care reforms though simply because they will lose their lucrative business, but this is where the government, run by the people, must step in and make the change. Health care should be about health, not profit.

Next, combine home and auto insurance into one blanket property coverage policy, with a mandatory minimum policy available at affordable rates that provides up to a half million dollars of coverage for up to three events without a rate increase. A tree falls on your house, you’re covered and the rates stay the same. Rear-end another car on the freeway? You’re still covered and the rates stay the same. Accidentally set fire to the neighbor’s garage in a welding demonstration? You’re covered for that too, but this time you’re rates can increase. Because most of these kinds of events are rare, the probability of an insurance company paying out often to the same person is unlikely, and fraud would be easier to detect. Blanket policies would eliminate confusing policy restrictions, because once fault is determined, the insurer would be required to settle the claim quickly. Determining fault should be completed in no more than 90 days. In cases of no fault, the determination should be made as quickly as possibly. One caveat to the property insurance policy would be for homes built in repeated natural disaster locations. If you live in an active earthquake zone that is likely to result in damage or a hurricane lands in your neighborhood every other year, an insurance company should not be required to extend coverage (or should be aloud to charge a much higher premium) if your home has been destroyed once, and if you choose to rebuild in the same place. Furthermore, the federal government should remove itself from this kind of rebuilding effort. Its quasi-insurance endeavor, FEMA, should stick to offering aid and clean-up assistance and stop using tax dollars to keep rebuilding homes in these places. Finally, a cap on damages should be instituted that limits awards to actual property repair/replacement costs and eliminates most kinds of non-compensatory awards. It’s high time for people to quit pretending that their entire psyche has been irrevocably damaged from tripping on the curb and that only money can make it better. Establish an account to cover medical co-pays, but all other medical concerns would be handled under each persons medical care plan. Insurance companies would probably fight these reforms too, but they’d actually save a ton of money in legal fees, bogus awards, and medical claims to cover most property damage claims and still gain a profit.

Life insurance is really a misnomer because we’re actually talking about a policy that pays your survivors when you die. Nevertheless, life insurance policies are the most capricious of all. You are basically betting on when you will die. You buy the policy thinking that you may die during the term and your family will be taken care of. The insurance company is betting you’ll live through the term of the policy and pay premiums without getting anything in return beyond your piece of mind. But if the main reason for life insurance is to provide financial support from beyond the grave, a national pension plan (A National Whole Life Pension Plan) provides many of those same benefits for families with children and makes unnecessary these policies for older couples. Offering a policy to cover the funereal costs seems like a pretty good idea though, at least saving your loved ones from having to handle the details. This would actually become more of a prepaid account than an insurance policy, assuming you lived long enough to cover the costs. Insurance companies could still offer additional life policies, but their appeal would likely diminish with the acceptance of the National Pension Plan in place.

All other insurance coverage could still exist in a carte blanche marketplace with rates and reliability not regulated beyond the normal rules of fraud and theft. Reforming the insurance industry won’t be an easy task, but it will result in better, more focused coverage, lower costs for individuals, and a renewed sense of what insurance is really supposed to be about. Like medical care, insurance as it exists today, preys on the misery and misfortune of others, or the inevitability of it. To make a profit for services rendered is one thing. To make an obscene profit while denying use of the very product you are selling is heartless. It is even more so when your product is mandated by law.

Financially speaking, bankruptcy occurs when you don’t have enough money coming in to cover your bills. As a legal maneuver, bankruptcy offers an individual, business, or government entity an opportunity to crawl out from under their accumulated debt and either restructure a repayment plan, reduce amounts to be repaid to creditors, or liquidate real assets and distribute the proceeds among those owed money. Once completed, a bankruptcy filing clears the way for a fresh financial start, or at least one with more breathing room. In the fiscal year ending in March 2005, approximately 1.6 million individuals (or married couples) filed for some form of bankruptcy protection. In that same period, nearly 32,000 businesses filed for bankruptcy. And, if historical averages run true, an average of 7 municipalities filed during that fiscal year. While this might not seem like an overwhelming percentage of the population, the effects of bankruptcies affect each of us in one way or another. When businesses go under, people lose jobs, cities lose tax revenue, and economies take a hit. When people go under, businesses lose money and recoup it through higher prices for the rest of us. Because bankruptcies are far reaching, the Constitution of the United States granted to Congress the power to regulate bankruptcy law. And recently, it has exercised that option to reform bankruptcy laws in this country.

But if you look at the changes made to the laws, the recent reforms seem to be aimed at helping businesses recoup their money rather than offer a fresh start to indebted consumers. Meanwhile, business and municipality bankruptcies are skewed against the average person, with accountability and repayment often swept under the rug for years on end. Bankruptcy, almost by definition, should be about helping the individual, not burying them under an even more complex financial disaster. And though consumers do need to take responsibility for their spending habits, the truth is that most personal (non-business) bankruptcies are precipitated by unexpected medical bills combined with a loss of income, losing a job, or by way of death or divorce. And while one could counsel that saving for these types of unexpected situations is something that just makes Common Sense, the truth is that a lack of financial education coupled with a national mantra of “Just Get It” means that most people have a hard time saving for a new refrigerator, let alone having a “rainy day fund.” We buy now and pay later, and with the exception of some big ticket items like a house or vehicle, which can usually be bought no other way for the average person, we rack up more in monthly balances than we bring in the door. The payment plan makes this affordable on a month-by-month basis, but lose some income or have a disaster and it doesn’t take long to fall into trouble.

But if the goal of bankruptcy reform is to reduce bankruptcy filings, which seems to be the feeling behind the recent law changes, than it would perhaps be wiser to address the root causes of most individual bankruptcies and try to reduce or eliminate those first. It’s almost always better to get to the root of a problem and treat it there than to continually treat the symptoms and not make any progress. So in creating real bankruptcy reform, let’s look to solve the reasons for each of the bankruptcy classes, starting with individual (or personal) bankruptcy.

According to recent studies, almost 80% of personal bankruptcies are filed due to one of three reasons: medical bills, job loss, and family break-up. Of these, the first is the easiest to eliminate. In my essay “Affordable Health Care Does Not Mean Free Health Care,” I proposed some changes to funding expensive medical procedures that would eliminate this as a reason for bankruptcy.

“In addition to the co-pay, the patient would be responsible to pay up to 50% of the actual costs of the medical procedure, up to a maximum out-of-pocket expense, but would be allowed to negotiate a no-interest, long-term, no penalty, flex pay installment agreement. Such an agreement could not be used to foreclose on any citizen’s property or garnish of their wages too severely, provided the citizen maintained communications with the fund administrator. At the same time, citizens trying to evade their medical bills with malicious intent should be brought to justice and forced to repay, this time at the terms of the courts.”

Such a solution would not only enable people to repay large medical bills according to their ability, but these bills would also not be an anchor around their financial necks. Indeed, medical emergencies are often beyond the control and planning of most people, and being forced into bankruptcy because you got cancer or had a heart attack or other serious medical condition seems to fly in the face of the concept of “life, liberty, and the pursuit of happiness.”

Outside of medical bills, job loss and marital break-up are the next biggest causes of bankruptcy. Of course, if people were living within their means prior to these kinds of events, bankruptcy would be much less necessary, but even assuming that a family was doing their best to not spend more than they were earning, loss of income can quickly create a hole that is hard to climb out of. For those who lose their job through no fault of their own (downsizing, restructuring, or business failure) a moratorium could be instituted that would give them a reasonable time in which to find a new job. If that job paid significantly less than the original one, a readjustment of debt should be worked out that would not damage a person’s credit worthiness so long as they were repaying their debts according to the new schedule. Marital dissolutions could follow a similar path too, with debt being divided equally between the couple and repaid over a longer term.

At the heart of the matter of personal bankruptcies though is the need to better educate people about personal finances and financial responsibility, to better educate people in general, so they can not only avoid the pitfalls associated with our materialistic mindset, but be in a position to earn a better living for themselves which would negate some of the reasons for bankruptcy in the first place. Bankruptcy should always be an option of last resort, and there should be a limit to the number of times a personal bankruptcy could be filed. At some point, we all have to live up to our mistakes, but in an age where personal responsibility is neither taught nor expected, especially in the financial arena, we must teach people how to control their spending as we work towards real bankruptcy reform. This, along with some of the reforms mentioned in “A Nation of Debtor’s” could result in better financial health for all people.

So what about business bankruptcy filings? What is the solution there? To begin with, financial pitfalls for businesses could be more readily avoided if there were an accounting standard that did not encourage creative bookkeeping. Certainly, reformation of the tax code will help in this situation, but also reforming medical costs and pension benefits (both topics covered in previous essays) would make it easier for businesses to uphold their bottom line in times of trouble. Requiring both private and public businesses to be audited annually would also help find problem areas before they became too large and resulted in bankruptcy filings. And severe legal penalties should be instituted for corporate financial malfeasance for companies that employ hundreds of people, since their overall financial health impacts the lives of their employees and the community at large. Businesses should be expected to be responsible, especially financially, since their success is in large part responsible for the success of our entire economic system. Business bankruptcy should reflect this attitude by first making
sure that failing businesses are held to higher standards than individuals and limit liquidation in favor of restructured debt. Businesses that fall into bankruptcy (or restructuring) should have their financing staff retrained or removed in favor of people who can keep a solid financial base intact. The CEO’s of these corporations, and their largest shareholders, should also be held personally accountable for guaranteeing the debts incurred by their companies if they are receiving compensation that runs into the millions of dollars each year or sit on a governing board that makes financial decisions. It’s time to make sure that these people are actually earning their money (if that’s even possible) by insisting that they take responsibility for bad business decisions that negatively affect the company’s bottom line and solvency. It’s time to put an end to the personal greed that permeates our largest businesses.

Finally, we get to the matter of municipality, or governmental bankruptcy. Of all the kinds of bankruptcies out there, this is the one that is perhaps most troubling. We can understand how people can get into a financial mess, either through personal misfortune or poor financial education. We can even understand the problems facing businesses that find themselves in financial dire straits, whether that reason is a poor overall economy or bad management. But when a governmental body moves into bankruptcy there is only one reason: corruption and ineptitude. Publicly elected officials must understand that the money they have to run government affairs is not their money, but that of the public at large, and a higher standard of accountability must be expected and insisted upon. Professional accountants, using honest accounting principals must be a part of any public funding process, with financial expenditures being made in the open and publicized so that people know where there tax dollars are really going. People must remember that politicians are not necessarily smarter than the average person when it comes to dealing with millions and billions of dollars and remain involved in the tax and spend process. A mandatory citizen’s board should be instituted to ensure that public monies are used for public projects and not wasted away in studies or kick-backs or other nefarious schemes. At the same time, the general public must learn not to expect government dollars to take care of their every whim. Tax revenue is designed to maintain infrastructure and run those public services that benefit the greatest number of taxpayers, in addition to funding some social programs. But to spend or allocate more than is collected is just bad business and bad politics.

The bottom line lies in education for everyone, a changed social attitude towards living far beyond ones means, and an expectation that bankruptcies can be avoided by adhering to Common Sense and integrity. But we must also remember that sometimes bad things just happen, even in the world of personal and business financing, and our bankruptcy laws should recognize this and look for ways to help people climb out of the morass instead of finding ways to keep them indebted forever.

American’s have one of the highest standards of living in the world. We have nice cars, big screen televisions, comfortable houses, a closet full of clothes, three square meals a day, and on and on. We don’t actually have these things in equal proportions; in fact, there are millions in this country who go without many of the things most of us take for granted, like a warm meal or an extra pair of socks. But the greater numbers of Americans enjoy a quality of life that is exponentially greater than the vast majority of the rest of the world. Most of this success is due to the ingenuity of the citizens themselves, their hard work and dedication. Some of it is due to our capitalistic economy that allows and fosters innovation through competition and financial reward. But another factor, the silent partner if you will, is the establishment of the credit industry.

Although the use of credit is nearly ubiquitous in today’s world, there was a time not too long ago when there were no such things as credit cards or debit cards. For a few big-ticket items, like a home or a car, a person could get a loan through their bank. For most other things though, if you wanted to buy something you had to have the money to pay for it then and there. Occasionally, “accounts” could be set up between merchants and consumers, but rather than being an organized program for all consumers, such arrangements were made on a case by case basis between friends or frequent associates. In those days, the average American’s standard of living was much more closely aligned with the rest of the world, though still faring a little better because of the industrial base and individual commitment.

Then, along came the credit card. This wonderful piece of plastic, embossed with a person’s name and account number, would revolutionize the way we lived and bought things, raising our material wealth, and as a result our standard of living, by introducing the concept of buying on time. With the credit card, a person could purchase that new washing machine now and pay for it over a whole year, making it less important to save for things, but more important to have a steady influx of cash. Still, by spreading out the total cost of an item, the monthly payment might allow the purchase of several big things, with a combined monthly cost less than that of buying a single item outright.

Flash forward 50+ years to today and the result of the credit industry is a national standard of living that looks good in person, but on paper it’s an accident waiting to happen. The average American has 7.6 credit cards in their wallet. (Store cards, gas cards, bankcards, etc.) The average household credit card debt is around $8,000. 43% of Americans spend more money than they earn each year, and as a whole, for every dollar we make we spend $1.22. We may be driving new cars and wearing designer perfumes, but the truth is that much of what we “have’” isn’t really ours yet because we’re still paying for it on a monthly basis.

So what went wrong? On the face of it, credit seems like a fantastic economic concept. By increasing spending power, you can increase production. Increased production creates increased business profits, which beget an increase in tax revenue. Seems to be win-win all the way around. And as long as everyone makes their payments on time, everything works out fine. But just because it looks simple and sounds simple doesn’t mean it is simple. Although credit makes things more affordable by spreading out the cost over time, buying on credit costs more than buying something with cash. It costs more because the person (or company) extending the credit charges you a fee for the privilege of paying over time. Behind the glowing promise of materialistic satisfaction lies the business end of the credit industry: interest payments. This is where people get themselves into trouble, and it is what the credit industry thrives on.

Using credit so that it benefits your life is a learned skill, but unfortunately it isn’t one that is taught to us as young adults. Instead, most of us learn about credit the hard way- through trial and error. It starts about the time we graduate from high school and we receive our first credit card opportunities through a bank or department store. Usually, the first cards are the easiest to get and they offer a low credit limit and a high interest rate. For the first time user, the concept that spending $200 you don’t have and ending up paying $300 for it doesn’t compute with a $10 monthly minimum payment. And without prior education, the thrill of having what you want when you want it is more than many 18 to 20 year olds can handle. Soon, they find themselves with several credit cards and increasingly higher minimum payments. Then they realize that their minimum payments aren’t reducing their balances and discover that they are barely paying the accrued interest each month. A missed payment bumps up the interest rates and triggers late fees and/or over limit fees. The balance increases and the trouble compounds from there. At the same time, a negative credit report is being built, making it harder and more expensive to get credit in the future for something more important than a new jacket or the latest home video game system. But by the time this is realized, the damage is done.

How much of this personal financial meltdown is the fault of the credit company and how much is the fault of the person? Certainly, credit card companies don’t force anyone to spend more than they can afford. But they certainly encourage it and actively seek as many possible customers as they can get, whether that person can afford the credit being offered or not. And while some credit companies seek only those customers for whom credit is a convenience, many others actively seek out those with marginal incomes who are often more in need of ready cash flow and less likely to take the time to understand the punitive details or the credit agreement. The result is a person indefinitely tied to their credit card balances, behind in payments, and unable to make ends meet or get ahead, and an increase in personal bankruptcies. Credit, instead of being the financial fairy godmother for families, becomes like a mafia loan shark waiting to take a bite.

Credit problems aren’t unique to individuals though. Companies small and large depend on credit for their day-to-day operations. Government carries the largest debt balance of anyone, which almost begs the question of who’s copying whom. It’s as if living beyond one’s means is the norm, and is not only expected to occur, but it’s considered downright odd not to be in debt to many different lenders at the same time.
Credit requires responsibility, trust, and rational expectations, both from those requesting credit and those granting it. Since the credit industry is a business, it has a right to generate a modest profit for itself. It is after all providing a service and helping to stimulate economic growth. But a society steeped in debt is not a free society. It is a society in hock, an indentured civilization where the rich get richer at the expense of middle class desires.

What needs to change? First of all, we need to educate our children (and ourselves) about the use of credit, the penalties associated with credit, and the consequences of poor credit reports. Start personal finance education in the middle and high schools and make a basic understanding a requirement for graduation. After all, in the real world, more people need to know how to balance a checkbook that figure the volume of a cone. Secondly, restrict the blind credit solicitations from credit card companies. The predatory solicitation of credit card companies is like an avalanche in every mailbox. Not only are these unsolicited, non-stop credit offers needlessly wasting valuable trees through paper consumption, they are aimed at those least able to pay the monthly balance in full. Credit should be sought by an individual, not forced down their throat. Third, decrease or eliminate over-limit fees in favor of temporary account freezes. After all, the purpose of credit is not to go eternally in debt, but to facilitate needed purchases or to use in place of cash you already have in the bank. Fourth, eliminate the automatic rate increase so popular among today’s lenders. Why should a late payment trigger an increase in all a person’s accounts, even ones with a perfect payment history? The only reason for this is to profit from a persons temporary misfortune. Fifth, limit the maximum interest rates to 10% or less. This is still enough for credit companies to make great profits, but low enough to keep debt from spiraling too fast. Sixth, require consumer notification before adding negative credit information to a person’s credit report. This allows an individual to account for any missed payments or other potentially negative problems. Seventh, require credit counseling for individuals who have chronic credit problems. Eighth, require credit companies to extend no more credit than a person can reasonably manage, and require subsequent credit companies to extend no more than a certain combined total of disposable income. Ninth, increase privacy laws by prohibiting the sale of credit bureau information and restricting access to that information to only companies currently doing business with that person. Strict enforcement could also reduce a large number of identity thefts, something that is an ever-growing problem.

Adopting these changes could help release the stranglehold that credit companies have on so many families these days. And by ensuring that people could afford the credit extended them, the number of write-offs would probably decrease, saving the industry millions of dollars each year. Slightly tighter credit requirements would encourage more saving and less impulse spending, good for both individuals and government in the long run. (More saving- less dependence on government aid.) But in addition to reining in the practices of credit companies, we also need to teach and expect people to better manage their finances, and by extension, the government must better manage its finances as well. Because a nation of debtors is only as secure as those who hold the note allow them to be, and when you’re in debt over your head, it doesn’t take much to start drowning.

Nothing puts a glaze into the eyes of average citizens quite like discussing economic theory. At best, it’s a confusing topic. Start injecting things like gross domestic product, prime interest rate, futures pricing, trade subsidies, and compound interest and you’ve pretty much lost most of your audience. But talk to the average person about money, and it’s a whole other ball game. Money, after all, makes the world go ‘round, or so they say. Everybody needs a way to earn money because nothing, except maybe the air we breathe, is free. Money, or a lack of it, shapes our lives in every imaginable way.

Growing up in a capitalistic society, we are raised to look at money as an end in itself rather than a means to an end. What I mean is, for most of us, the acquisition of money is what drives our lives. We need or want things that cost money, so we work to make money. We trade that money for things and then need more money to get more things. The more we have, the more we need. The more we need, the more we work. Capitalism requires a certain level of materialism to function properly, and we seem to have that down to a tee. But as our lives grow increasingly more dependant upon a steadily increasing flow of money, and as our materialistic tendencies increase with each new innovation, we slowly lose focus of what is really important in life and we instead turn all our energies into amassing as much money as we can (or as many things as we can, which can prove how much money we have or had.) Rather than spend our relatively short time on earth in harmony with each other and nature, we construct an adversarial environment that pits man against man with money right in the middle.

Of course, governments need money too, and as a result, we have taxes. Because government does not produce anything sellable (in theory at least) yet it is expected to provide many tangible and intangible things for the citizenry, the only source of money for the government (again, in theory) is taxes. The bright side of taxes, at least in a democratic society, is that their collection and use is supposed to provide for the common needs of the society, so you get back what you put in, in some manner or another. Unfortunately, the reality is often somewhat less than that. Too often, the people in government spend public tax dollars as if they had won the lottery, providing little oversight or accountability for the way those monies are spent. Such waste or abuse causes the average citizen to have to provide more tax dollars, making him earn less or work more. In addition to setting tax rates and spending tax dollars, government also creates legislation that causes more money to be drained from the everyday worker and into the pockets of the business industry, setting up an adversarial environment between man and the government.

And then there’s business. Provider of jobs (so people can earn money) and creator of goods or services (so people can spend money.) Friend of the politician (through political donations) and befriended in return (with tax subsidies and tailor-made regulation.) Business is the glue that holds the whole system together, but being in that position requires a greater level of trust and integrity than exists today. Part of the reason for the animosity between people and business stems from the mutual reliance each has on the other. We wish we didn’t have to work for a living and business wishes they didn’t have to pay us to work for a living, but as we can’t have one without the other, an uneasy truce exists. The other reason stems from the misguided notion that a business entity is the same as an individual, at least so far as the law is concerned. Businesses exist to provide jobs, goods, or services. They exist to generate money for the workers and money for the owners. But they are not thinking, breathing, sentient forms. Businesses are piles of paper and rooms of inventory. They have no need for food or shelter or health care. Yet government policies and regulations afford businesses many of the same rights that are afforded to individuals. As such, businesses (and those who head them) can affect social mores and agendas more readily than average citizens can simply because business has greater wealth resources than individuals do. An already adversarial environment just gets that much worse.

Underlying all this commotion though, is still the idea that money is an end in itself. And with that concept comes the tendency of people, government, and business alike to devise any scheme to get more than they are entitled to. Because in addition to satisfying our materialistic tendencies (which I believe are more ingrained than innate), money also carries with it an element of power or control. The more money a person has, the more control they have over their destiny or the things they want to have. The more money a business has, the more it can control its corner of the marketplace and the more power it has in the political sphere. The more money government has, the more it tries to spend it, usually on ill conceived plans, but just as often on things or in ways that the tax payer would not approve of. Too often, tax money just fades away or gets diverted while the original intended use is forgotten about. Yet government always wants, and has the power to get, more money than it needs. And all too often, business and government conspire to get more from the citizens, whether it is money or work or both.

The business of money is yet another area to consider. Banking, insurance, and investing are all aspects of our financial world that touch us each on some level, including government and businesses. Because money is so important in our world, entire industries evolved to help us manage, protect, and increase our own supply. In a not so surprising turn of events, these industries are among the most powerful “behind the scenes” forces that shape financial and economic legislation in ways that affect the daily lives of John and Jane Doe, sometimes for the good, often for the bad.

Money is important. There’s no getting around that. But is it the most important thing in life? Problems with money are often the main cause of family strife, business failure, or government corruption. For those who have little, it’s never enough. For those who have some, it’s never enough. And for those who have plenty, it’s still never enough. This is the prevailing attitude of the majority of people in our country, and the majority of businesses as well. The next several essays will talk about various economic issues, among them credit and bankruptcy, insurance, taxes, trade, saving money, business and labor, unions, and the consumer society we live in. I’m not an expert on economics, but I hope to take a fresh look at these necessary aspects of our world and throw in a little Common Sense where it’s needed. I hope you’ll join me.

We live in a society that at times seems to take great pains to produce the most idiotic and inane policies possible. In this era of nonsensical political correctness, where up is told it’s really down, and the word “is” has infinite meanings, one of the most confounding practices to be injected into our society (almost like some kind of illicit drug) is that of Zero Tolerance.

On the face of it, Zero Tolerance policies seem to make sense, especially in a society that is portrayed as increasingly dangerous and hostile. It is, in a sense, a natural backlash from a society that feels battered by crime and hatred. Kids going into schools and shooting up the place; little league coaches molesting children; gang bangers causing all kinds of havoc; we see these things and hear about them every day on the TV or in the papers and we want to protect ourselves. Zero Tolerance policies provide tough consequences for those who go beyond the bounds of acceptable behavior, hoping to reduce or eliminate those who would do so. Whether our communities are actually dangerous places or we want to prevent them from becoming so, Zero Tolerance policies look great on paper but actually provide a false sense of security while destroying the freedoms of ordinary people. The truth of the matter is not so much that Zero Tolerance policies can’t be effectively used, but rather we are using them against the wrong people.

Zero Tolerance policies are as much a part of our education system now as pencils and paper. But are they really making our schools safer for our children? Does expelling a kindergarten student for throwing a temper tantrum and throwing a crayon at the teacher make the rest of the kids safer? Was the child really a monster or just having a bad day? With Zero Tolerance we may not have a chance to find out since the first infraction results in expulsion. What about expelling a junior high school girl who brought a butter knife to school for the Home Economics class she was in, but instead of taking it right to the classroom like she was instructed, got sidetracked with some friends and discovered her mistake during the lunch break. Someone sees the knife in her backpack and next thing she knows, she’s being sent home indefinitely for carrying a concealed weapon. No matter the reason for the knife’s presence. With Zero Tolerance, no excuse is good enough. What about the high school sophomore who chooses to wear his “I Love Jesus” t-shirt to school? Do the children of atheist parents faint in his presence or go into convulsions? Does sending him home to change or face suspension really make the rest of the school safer? The problem with Zero Tolerance in our schools is that they lack any effort to use Common Sense and employ every effort to maintain a façade of impartiality and fairness, all the while destroying the academic careers of otherwise trouble-free kids for expressing an opinion that isn’t hate filled or inciting violence or for making an innocent mistake, which, by the way, is what growing up is all about. Rather than promoting a safe learning environment, these policies have only succeeded in making our schools more like the prisons we hope our children never visit as adults. Is this how we foster freedom and democracy in our children today?

Kids may be the most affected by the Zero Tolerance society, but adults encounter their fair share too. A classic example is our new and improved airport security policies. Aimed at giving the appearance of safety in aviation, the actual practices and enforcement of security policies are widely viewed as nonsensical, in large part because they seem to take every chance to avoid actually increasing security. At the security checkpoint, people are prohibited from carrying nail clippers, cigarette lighters, small letter openers, or other ordinary items beyond the metal detectors and x-ray machines. You can, however, have matchbooks or pilfer a butter knife from the lounge near your gate. Your shoes must be examined thoroughly, to ensure that they aren’t really bombs. But what if someone just started hitting someone else with his or her shoe really hard? Zero Tolerance would soon prohibit all shoes on flights. More extensive searches are made of old ladies walkers or infant carriers, especially those of Caucasian women despite the fact that the last people to hijack and use planes as weapons fit an entirely different profile.

And that is where the government applies it’s own version of Zero Tolerance. From a political perspective, Zero Tolerance policies are aimed not at reducing harmful behaviors, but at getting and keeping votes and power. Such policies include a ban on racial profiling in the case of suspected terrorism, a policy that completely disregards everything we know about the Islamic militant radicals who wish for an end of western civilization. This is not to say that all Middle Easterners are terrorists or that all terrorists are Middle Easterners, but at this point the preponderance of the evidence shows that focusing on these kinds of folks will likely yield higher safety quotients than harassing Granny at the subway station will. Politicians have also created an all-encompassing Zero Tolerance attitude with respect to opposing political parties and ideologies, following the example set for them by their religious or special interest or corporate benefactors. In this case, there can be little or no dissent within the ranks. Any disconnect between the party line results in censorship at best, marginalization or expulsion at worst. That’s hardly an inspiring atmosphere for national political discourse that affects all our lives. Nothing says freedom like stifling opposition opinions.

Strangely enough, that segment of society truly deserving of a Zero Tolerance policy is the one we seem to give Unlimited Tolerance to, namely the heinous criminals who murder our friends, rape our children, destroy our financial lives, and erode the public trust. To these people, society (through the politicians and PC idiots) has a seemingly unending supply of tolerance. It shows in the way we release them from prison early (or at all) despite their horrific crimes. It shows in the way juries defy all Common Sense and free obviously guilty people. It shows in the way that the courts toss out evidence that proves guilt or innocence because of insignificant technicalities. If ever a portion of society earned a reputation for needing a Zero Tolerance policy, it is the people who commit the worst acts on other people. Yet somehow, their behavior gets excused.

Zero Tolerance fails because it assumes that all people think the same, act the same, and are equally dangerous. It focuses only on the perceived infraction, establishing that an infraction actually occurred, and then proceeds directly to the harsh punishment attached to that act. It cares nothing for rational explanations or opportunities for learning and growth; it cares only about punishing and setting an example. It slowly drives away individuality and replaces it with a wariness of each other and an expectation of privacy invasion. Zero Tolerance is a forced trade off between the public and the government. We give up some autonomy and you give us security. Instead, we give up our ability to teach our kids and identify real problems for the mere appearance of security.

Perhaps most troubling of all though, is the fact that Zero Tolerance naturally embraces conformity and punishes individuality. This is a great benefit to the power brokers in the capitols across the country, but it spells doom for the average person. As we continue to indoctrinate our children and ourselves with the notion that Zero Tolerance is the only sure way to security, and as we perpetuate an environment of distrust, we will eventually become a parody of ourselves, screaming for freedom as we build walls around ourselves.