By simultaneously reducing the supply of present and (expected) future goods, governmental property-rights violations not only raise time-preference rates (with given schedules) but also time-preference schedules. Because appropriator-producers are (and see themselves as) defenseless against future victimization by government agents, their expected rate of return on productive, future-oriented actions is reduced all-around, and accordingly all actual and potential victims become more present oriented. Hans-Hermann Hoppe, "On Time Preference, Government, and the Process of Decivilization"
It's been two years since I started a new job and for two years I thought long and hard about what to do with my 401(k). Should I roll it over into an IRA? How about a Roth IRA? Should I just pay the penalties and cash out? After two years of contemplation and observation I have decided to cash out. I'm not eligible for retirement (and I mean age eligible to access the money without penalty) for another 30 years. I have no clue as to what the account would be worth in 30 years nor do I have a clue as to what tax rates will be 30 years from now. So I plan to cash out, pay off my student loans and credit cards, and buy a new car. Perhaps a Lexus or Infinity. What ever is left over, I'll put into gold and some foreign currencies. How did I come to this conclusion? Allow me to describe the trends that I see in this country that have persuaded me to live for the now rather than the future.
As everyone who reads LewRockwell.com, Mises.org, William Grigg, William Anderson, Radley Balko and other like-minded website regularly knows that things look grim. The Federal Government, State governments, and local governments are becoming desperate for revenue. These entities could possibly increase their loot by removing economic burdens like minimum wage laws, health care laws, regulations as well as ending all wars, lowering taxes and returning to sound money. Such lightening of the yoke of the State on the productive class would lead to more wealth for more people and possibly more tax revenue for the State. This is not to condone the State's theft known as taxation; I'm simply pointing out the possibility that the government at all levels might have more revenue if people were free to produce. However, it is clear that the corrosive effects of power precludes such thinking among the ruling class.
Nevertheless, the ruling class is not going to lower their living standards as the economy collapses. This says to me that no wealth anywhere in the world is safe form our Federal Government. No matter where we try to hide our wealth, they will search for it and they will take it from us. The Federal Government already claims that it can tax expatriates who claim citizenship in another country for up to 10 years. As the money runs out I expect our ruling class to become even more ruthless in their efforts to steal money and property from their subjects. The people who depend on government largess will encourage Federal, State, and local governments to collect whatever money wherever they find it. I expect the State and local governments to use asset forfeiture more liberally as time goes on. It would not surprise me if police being pulling people over not just looking for drugs, but other contraband such as raw milk (since governments are raiding raw milk producers, I don't find this hypothesis far-fetched). I expect government officials to eye 401(k)s, IRAs, and Roth IRAs. I expect exchange controls. I even think it possible that the government could ban buying and selling gold. It's really hard to predict what exactly would happen, but when a government is desperate for money, every crime imaginable is on the table.
I have also noticed that the State has become increasingly violent in enforcing their tyrannical laws. The SWAT team raids on raw milk is prima facie evidence in my eyes since the idea of invading a farm or co-op with automatic weapons and bulletproof vests should offend anyone with a shred of decency and humanity. But there is also the violations of the TSA which molests children and adults alike and arrests anyone who protests such treatment. There is the war on cameras by the police who do not want the public to question their activities. There is the crime of contempt of cop in which police threaten, arrest, beat or even kill people who do not show proper deference to their authority. There is the ideological war against those of us who love freedom and hate the State being carried out by the FBI. If State agents are willing to demonstrate such show of forces just to scare raw milk producers or people who simply protest unjust treatment, I expect them to shoot first and ask questions later when it comes time to steal the wealth of their subjects.
Of course, I could be wrong about the future I think that we are headed toward. It is possible that the American people wake up simultaneously and throw off the yoke of their masters. The Leviathan State collapses and I could find work as a private mediator or start my own private security firm. But as anyone who reads my work regularly knows, I simply don't see this happening. The ruling class continues to destroy lives and property in this country and other countries and there are no signs that their cupidity could ever be satiated. Nor do I see enough resistance among the American public to start a real ideological revolution. And those of us who have taken the red pill know that our government will kill us for disobedience and the agents called to do so have no qualms about pulling the trigger.
Thus, my gloomy outlook on the future has compelled me to live for now. I think it quite likely that that several years down the road, the State will take even more of my earnings or my wealth or crack down on heretics who preach blasphemy such as the State is a criminal institution and is an unnecessary evil. I might as well pay off debt (my hedge in case the future is not as bleak as I imagine), take a few vacations to foreign countries, upgrade my wardrobe, buy a car. Just have a blast now since I don't know what the future holds and cannot be confident that my own prudence will pay off. Rather than worry about having enough money for retirement, I've decided that I won't retire. No more saving money in IRAs or 401(k)s or any investment vehicle in which I don't have immediate access to the funds.
I should point out that I'm not married and have no children. I'm sure my thinking would be different if I did have a family because I would be compelled to have a low time preference for their sake. But I'm only responsible for myself now so I'm going to party like it's 1999.
Joseph Goebells(sic) once said that to change reality, tell a big lie, tell it often and loudly and soon, all the folks would believe it. Such is the case with federal income taxes. Earnings by embedded workers in the private sector engaged in activities of common occupations are outside the taxing authority of the central govt. So says the law, the Internal revenue code, SCOTUS decisions and IRS actions. Yet, few believe it! See losthorizons.com for the details.
Posted by: Redman | August 26, 2011 at 10:06 AM