Look, Mom, No Traffic Jams!
“There is great virtue in the original concept of users-pay/users-benefit.”
–Robert Poole, Jr., Nation’s #1 Transportation Expert
One of the consequences of Keynesian economics is the gradual decline in capital investment, especially in infrastructure, in the United States. The late, great management guru Peter Drucker blamed Keynesian thinking for an unhealthy anti-saving mentality, causing “undersaving on a massive scale” and an overemphasis on “short-term” spending instead of the long-run investment.
Today, our roads, bridges and infrastructure are falling apart and need trillions of dollars to bring them up to par with the rest of the world. (Compare our roads and airports to those of Hong Kong or Germany.)
Right now, there’s a $78 billion shortfall in the Highway Trust Fund that builds and repairs our vast Interstate Highway System.
How are we going to pay for it? In his latest report, transportation expert Robert Poole (founder of Reason magazine and a speaker at our upcoming FreedomFest) said that the hottest idea for making up for the $78 billion shortfall is “repatriation” of U.S. corporate profits held overseas.
But to use corporate profits to pay for building and repairing the Interstate highway system is a clear violation of the accountability or benefit principle of economics, also known as the “user pay” doctrine.
Every year, I teach the accountability or “user pay” principle in my economics class. It is fundamental. Unfortunately, few of our leaders understand it.
Yet, as Poole stated, “It’s the model we use for electricity, natural gas, water, telecommunications, airports and just about any other utility-type service that requires significant infrastructure. The original state gas taxes (dating back to 1919) and the 1956 dedicated federal fuel taxes were all intended as user fees to provide and maintain the infrastructure used by those paying the charges. While that concept has eroded over the decades, sound transportation policy would call for restoring it rather than further diluting it.”
Poole’s solution? “Per-mile tolling and other forms of mileage-based user fees are therefore the direction this country should be moving toward, to gradually replace per-gallon taxes. Using yet another general (non-user) revenue source to bail out the HTF is a large step in the wrong direction.”
Tolls and user fees would eliminate forever the traffic jam problem. Countries like Singapore and Hong Kong have proven it. I’ve been there. I have seen the future and it works!
Robert Poole will be speaking at this year’s big show in Vegas, along with more than 100 other experts. Our focus will be on real solutions to our problems. The next time you are in a traffic jam, remember that there is a free-market solution and sign up for the “greatest show on earth.” See details below.
You Blew It! Record Number of Americans Renounce Their Citizenship
Every year we have a session at FreedomFest on “Tax Free Living and Investing Abroad.” The attendees want to know all about the benefits of renouncing their U.S. citizenship and living a “tax free” lifestyle abroad.
Last year, nearly 3,500 Americans said good-bye to the states to live in the Caribbean, Latin America, Asia and Europe.
Certainly, the U.S. government has imposed draconian rules and confiscatory taxes on Americans living abroad. It’s almost impossible now to open up a bank account in a foreign country because the foreign banks don’t want the hassle of dealing with U.S. tax authorities (it’s a misnomer to call it the “Internal Revenue Service.” It’s not “internal” — the IRS arm reaches out beyond our borders. Revenue is just a nice word for “taxation,” or even “theft.” And certainly the IRS is no “service” to anyone except bureaucrats and what Ayn Rand called “looters”).
In order to renounce your citizenship, you have to go to a foreign embassy and you have to pay an exit tax on all your net worth, which can be expensive if you are rich. You have to have another citizenship or passport to live abroad. You will have to pay taxes where you reside. (Even tax havens like the Bahamas have import duties you will have to pay.)
And then you have to get in another line for foreigners when you come back to visit the United States and immigration may give you a hard time. You will need a visa to return to the States, and even then, you can’t stay very long (no more than three months is recommended) or you will be charged taxes again on your worldwide income.
I know one friend who renounced his citizenship, then later regretted it and had to reverse the process — what a pain.
So think twice, my friends, about living the “care-free” lifestyle of an expatriate.
In case you missed it, I encourage you to read my e-letter column from last week on Eagle Daily Investor about Apple’s success, the great man theory and Say’s law. I also invite you to comment in the space provided below my Eagle Daily Investor commentary.
Good investing, AEIOU,
Mark Skousen
Presidential Fellow, Chapman University
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Upcoming Appearances
Investment U conference, March 11-14, 2015, St. Petersburg, Florida: “A New Golden Age” is the theme for this year’s IU conference at the Renaissance Vinoy Resort. Speakers include Alex Green, Marc Lichtenfeld, Dave Fessler, Frank Holmes, Bryon King, Karim Rahemtulla, Michael Checkan, Rich Checkan and Martin Truax. To register, go to www.investmentuconference.com, or call 1-800-926-6575.
I want to invite you on a cruise, Sept. 13-20, with Newt Gingrich, Chris Versace and me, among others. Come spend seven fabulous days aboard the six-star luxury liner, the Crystal Symphony. We will travel from New York to Montreal with a roster of noted historical scholars, political pundits and renowned market experts who will share their insights and perspectives on the current environment in Washington and Wall Street. For further information, including how to sign up, call 800-435-4534 or visit www.PoliticsAndYourPortfolio.com.
FreedomFest, July 8-11, Planet Hollywood, Las Vegas. We already have 1,000 people signed up, and FreedomFest includes the best three-day investment conference in the business. It changes the lives of people. I just received an unsolicited video from entrepreneur extraordinaire Wayne Allyn Root about how FreedomFest has changed his life. Please take three minutes of your time to watch this video. You’ll see why this is the conference that even speakers like to attend. Come join us by calling Valerie or Hayley at 1-855-850-FREE or go to www.freedomfest.com.
