Mish's Global Economic Trend Analysis |
| Posted: 16 Jan 2013 03:38 PM PST Inquiring minds are listening to an interesting Interview with Nigel Farage on the "Brexit". For those unfamiliar with the term, "Brexit" means a United Kingdom (British) exit from the EU. Six days ago in We Want to Have Our Cake And Eat It Too; Another Hotel California Setup; One Million Tiny Miseries, I gave my reasons why the UK should kiss the EU goodbye. I am certain Farage would agree, while offering a dozen more reasons of his own. Click on the first link to play the podacast with the always entertaining Farage, to hear what he has to say to GoldMoney interviewer Andy Duncan regarding the ongoing euro currency situation and the recent speeches from Mr Barroso, the President of the European Commission. They also discuss the recent news of the German Bundesbank's decision to repatriate some of its physical gold reserves from the USA and France, and the chances of the "Brexit" in the next few years, as well as the likely fate of the euro and the EU itself. Select Ideas
Farage comments on the sheer size and scale of the Spanish banking problem, and Spain's growing political and social instability. He also comments on the concept of an "effective greater Deutschmark zone" and the "Brown Bottom" in gold. Farage states he underestimated the "sheer fanaticism" of the levels that Germany and European institutions would go to "stave off the inevitable". So did I. Currently, I think Farage underestimates the problems in France (and that is saying a lot). For discussion, please see France, the Hidden Zombie in Europe Farage is always worth a play for entertainment. In this case, Farage did not disappoint. He was as entertaining as always, yet this time with far more serious undertones and discussion. Once again, please click on Interview with Nigel Farage on the "Brexit" to play the podacast with the always entertaining Farage. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| Posted: 16 Jan 2013 10:50 AM PST Yet another "Trust Fund" is broke. This time, discussion involves an alleged "Transportation Trust Fund". As with Social Security, there is no "Transportation Trust Fund", only a stack of unmarketable IOUs from one branch of government to another. If there is any trust in the system, there shouldn't be, and soon won't be. Obama will surely see to that. Grid Chicago reports Charging by the mile, a gas tax alternative, sees serious movement. Because of vehicles with higher fuel efficiency, slightly less driving, and the gas tax not being changed since 1993, the motor vehicle fuel tax, or "gas tax", has failed to pay for everything that Congress has legislated that it should pay for. The Highway Trust Fund, which includes the Mass Transit Account, has received several infusions of money from the "general revenue fund" – to the tune of over $60 billion.Mindless Possibilities Got that? Bureaucrats are actually pondering a system that would require road use prepayment based on self-reporting of miles driven. It's always important to keep in mind that the bureaucrats have an infinite capacity to do mindless things. How many bureaucrats will it take to manage a self-reporting system? At what cost? Who will comply? When that proposal does not work, (and obviously it won't), bureaucrats are likely to do something such as mandate devices in cars that will communicate with devices at gas pumps, tracking your every move. Such devices will no doubt be manufactured by GE who will be the big beneficiary of it all in terms of profit. Meanwhile the actual manufacturing jobs for such devices will go to China. Gas station owners and car manufacturers will both have to install such devices at great expense. While pondering the ramifications of mindless possibilities, let's also take a look at proposed costs. Keep in mind things always cost more than proposed. Scheme to Boost Taxes 250% The Examiner reports New pay-per-mile scheme would boost taxes 250 percent An on-again, off-again move by the Obama administration to scrap the federal gas tax in favor of a pay-per-mile fee would boost the tab to Americans as high as 250 percent, raising their current tax of 18.4 cents a gallon to as high as 46 cents, according to a new government study.Obama Mulls Replacing Gas Tax With Hefty Mileage Tax Political Outcast has some choice comments on the idea in Obama Mulls Replacing Gas Tax With Hefty Mileage Tax. One reason gas prices are so high is that the Feds impose a tax of 18.4 cents per gallon on gas. It's 24.4 cents per gallon of diesel. We've had federal gas taxes since the 50's to pay for highways and bridges, but since 1983, they started diverting about 20% of gas taxes to go to a Mass Transit Account that is supposed to pay for public transportation like buses and railways. So, those of us who don't use mass transit are paying for those that do in the form of gas taxes. That's socialism for you. Robbing Peter to Pay Paul (With IOUs of Course) Political Outcast gets to part of the problem. However, I am not opposed to the idea that people who use services should pay for them. But why stop at roads? Why shouldn't people who use libraries pay for that usage, rather than everyone else? Why should Social Security recipients get out more than they paid in? Why shouldn't mass transit users be the ones to pay for mass transit? Most importantly, why don't people with kids in the public education system pay for the cost of the schools and their kid's education? If they did, I assure you costs would come down because people would demand more for their money. Next Set of Questions
Before we go about charging people for miles driven, how about making sure taxpayers get their money's worth in services received? For road maintenance, the way to do that is easy. Scrap Davis Bacon and all prevailing wage laws, then let cities and states put out bids for work at non-union rates. If the states and federal government would scrap all prevailing wage laws and make recipients in general pay for services received, I will be more than happy to discuss better ways of making drivers (and everyone else) pay for services received. Camel's Nose in the Tent As an addendum, I offer reader "Lapdog" comments ... "A miles driven tax is just the camel's nose in the tent. It will ultimately be a GPS/vehicle-based system that will allow charging more based on time of day, type of road taken or where one wishes to go i.e. into downtown business districts." Precisely. The possibilities for more taxes, and more tracking of everything you do, while under guise of making people pay for services are infinite. Moreover, both parties want to keep track of everything you do under guise of protecting against terrorists. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
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