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Milton J. Madison - An American Refugee Now Living in China, Where Liberty is Ascending

Federalism, Free Markets and the Liberty To Let One's Mind Wander. I Am Very Worried About the Fate of Liberty in the USA, Where Government is Taking people's Lives ____________________________________________________________________________________________ "Extremism in defense of liberty is no vice. Tolerance in the face of tyranny is no virtue." -Barry Goldwater-

Friday, October 08, 2010

Saving Saving - By Andrew Stuttaford - The Corner - National Review Online

The writer addresses the question as to why savings rates are lower in Western industrialized nations. I am sure that there are many reasons and this article delves into tax policy that is hostile to savings and as a result, encourages consumption. Why save, if your profits arehighly taxed but if you consume it, it is not?

But even more insidious, is that savings are taxed on phantom profits resulting from inflation creating effective taxes on savings that sometime are over 100%. Additionally, the threat of means testing such programs as social security means that if you have saved 'too much' that you will not receive the payments that you have both paid for and are entitled too.....
Also avoided is one other point well worth mentioning in the light of current debates. To what extent would the means testing of social security (and Medicare) entitlements operate as a disincentive to save? Quite a bit, I reckon.
So, why risk government changing it mind years down the road. Spend it all now.

Saving Saving - By Andrew Stuttaford - The Corner - National Review Online


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