ECONOMIC EQUALITY

 “Equality” Programs Aren’t Working

                    But Our USA Plan Will

Dick McDonald

Blacks have seen their annual income drop in President Obama’s first four years by almost $7,000 a year - all workers have experienced a drop of over $4,000 a year. Although President Obama recently claimed that the main goal of his second term is equality that same goal obviously didn’t work for him in his first term. But let’s be fair; not everything is Obama’s fault.

The facts are that over the last 44 years government has spent over $16 trillion on welfare, entitlements and means-tested programs in their “War on Poverty”. Predictably a greater percentage of Americans are in poverty today than when that “war” began. Predictably because government doesn’t create wealth it consumes and depletes it.  It only redistributes what wealth is left over after it takes its cut.

So when the “progressive” New York Times contends we need to rethink antipoverty policy we know their suggestions won’t work because their philosophy begins and ends with government as the vehicle where all wrongs are righted. And again government does not create wealth it consumes and depletes it through taxation and regulation.

However, NYT op-ed writer Nicholas Kristof recently pinpointed part of the problem when he opined that welfare and entitlement programs have only “addressed symptoms of poverty, not causes.” Unfortunately in his article he advances a .01% solution to a 100% problem. That was to spend more government money on the early development of children living in low-income zip codes.

That will be microscopically helpful in 15 to 20 years. It surely doesn’t address the problem now and that problem is poverty.  No one is saying that welfare and entitlements haven’t helped those living in poverty. What we do say at the Prosperity Commission is that we have to find a way to make the poor rich or comfortably so.  Until we do the problem of poverty and the ever-increasing $138 trillion of funded and unfunded national debt won’t go away.  It will progressively become more fatal to our way of life.

Most great wealth in America is created by investment. To prove that ask yourself where pensions invest their money. Investment in the stock market is where 98% of our pension assets are employed. Therefore the trick to making the poor wealthy is by their making an investment in the stock market and letting their investment accumulate, compound and grow over their working life into a sizeable nest egg.

That presents two problems. First where are they going to get the money to invest?  And second will they be willing to let that money remain invested for their entire working life in order to achieve the eventual goal of comfortable wealth for themselves, their families and their kids..  

Those questions are answered along with a myriad of others at www.theusaplan.com .  The ultimate result of the plan is that eventually the average American citizen will end up with a $4 million nest egg (today’s rate) and a $33,333 a-month retirement check.  Its enactment will immediately result in cutting the national debt from $138 trillion to $30 trillion and the creation of millions of jobs almost overnight.

The eradication of poverty is eons easier than to flying to the moon – and we already did that.

It's time

The Time to Eradicate Poverty Has Arrived

Dick McDonald

Today the people of the United States of America have an opportunity to make the world a better place. Rather than wasting time compromising the political ideologies of progressives and conservatives, Americans could use that time to employ modern economic and scientific advancements to eradicate poverty. 

The USA could lead the world into a new era where prosperity is the rule rather than the exception.

For example, if  Americans had enough money on which to live a decent life and a million-dollar nest egg to retire on (then pass on to their families) we wouldn’t need government to tax Americans to fund safety nets like Social Security and Medicare.  We wouldn’t have a $138 trillion debt to contend with; America would be financially solvent and countries all over the world would emulate us.

All economies throughout history have been free enterprise, free market, capitalist economies unless temporarily sidetrack by populist ideologues practicing socialism or dictators employing tyranny. Therefore in order to make a free enterprise, free market, capitalist economy like ours into one that sponsors the prosperity of the poor and lower classes it has to create the opportunity for the poor to invest in that economy and prosper in its growth.

Man hasn’t had the tools to address poverty until recently. With the advent of the digital age, massive and flexible databases, the internet and instant communications he now has them.  He can make dramatic nation-wide moves that will eventually enable all the people to achieve the American Dream of financial independence. No political party or political think tank is even attempting to address making the poor rich. It is the time to do so; in the process most of our economic and social ills will either fade or disappear entirely. 

We can’t make the poor rich without making all citizens even richer. To do that requires a simple change in the way the government does business. Instead of imposing a 15.3% payroll tax on income we propose the government send that money undiluted directly to an independent unreachable trust for all citizens to be maintained in each taxpayer’s own “USA” – universal savings account – and immediately invested weekly on their behalf and under their direction into indexed stock funds for their working life. 

The average American makes $50,000 a year and pays either 15.3% in payroll taxes if self-employed or shares in paying that amount with his employer if he works for somebody. The yearly $7,500 ($50,000 x 15%) investment amounts to $300,000 (40 years x $7,500) over an average 40-year working life. Invested weekly in indexed funds at the average rate of return of the S&P 500 in 40-year cycles generates a $4 million nest egg which throws off a $33,333 a month retirement check without reducing the principal. See here for the computation by year.

Today the market cap of all stocks on American exchanges is about $50 trillion. If in 40 years just 150 million Americans had a $4 million nest egg the market cap would be $600 trillion. In other words it took 236 years to get to $50 trillion. It would, under my plan, take just 40 years to add $550 trillion to that amount at today’s prices.

Given the choice of becoming a millionaire without investing a dime out of your present paycheck or staying on welfare and dependency programs most will opt for the former. In this manner the Plan, www.theusaplan , will wean welfare recipients off welfare and reduce the need for excess government workers.

Millions of jobs will be immediately created by the infusion of almost a trillion dollars a year into the stock market where the selling shareholders will no doubt invest much of their proceeds in new exciting ventures that will require millions of new employees.

In this manner the poor will be helping create their own new jobs and working-life income and at the same time insuring themselves of an affluent retirement and the best old-age medical care on the planet. 

A rising tide lifts all boats. Unfortunately America’s boat has been in dry dock too long. Enacting my plan will be the rising tide that makes the poor rich as well as everyone else richer.  The country will then be exceptional place we claim it is.

Let’s agree poverty has no place in the 21^st Century.

Read all about the Prosperity Commission’s USA Plan and its Rise Up Theory of Economics here.  Join us in our effort to make the world a better place.  You can e-mail us your thoughts at dick@...

USA PLAN: Immediately cuts the $138 trillion of debt to $30 trillion upon enactment

This is what Americans need – a time out from the politics of ideologues in Congress, political parties and the media and a simple easy-to-understand solution to the many problems we face.

Dick McDonald's solution is simple but outside the box of conventional thinking.

THE USA PLAN

READ MORE

How Republicans can give Democrats everything they want - UPDATE

Yes We Can

http://www.newyorkdailysun.com/yes-we-can/1117

What Democrats Want Republicans Should Give Them

http://www.newyorkdailysun.com/what-democrats-want-republicans-should-give-them/1133

UPDATE:

Another article printed by the NY Daily Sun.

Powerful Democrat Says No to Obama’s Plan: We suggest a better plan

http://www.newyorkdailysun.com/powerful-democrat-says-no-to-obamas-plan-we-suggest-a-better-plan/1205

Introducing THE USA PLAN

The USA Plan is bold and truly revolutionary. It should satisfy both capitalists and collectivists, Republicans and Democrats, Libertarians and Anarchists and everyone in between because it makes the poor, the middle-class and the rich wealthier – in fact it delivers the American Dream to just about everyone.

www.TheUsaPlan.com

The USA Plan is designed to increase the wealth of all citizens not just the few. It is triggered by the reduction of taxes imposed on them by government. The Plan is based on the Rise Up Theory of Economics which elevates the financial rights of the individual over those of the state.


The Rise Up Theory does for the poor and middle class what the "Trickle Down" Theory did for the rich - it makes them wealthy. It closes the gap between the rich and the poor and eliminates the cry for social justice. It reduces the income disparity which has become a major political issue for which no party has been proposing a workable solution. The USA Plan is that solution.


It is a simple concept, it redirects the 15.3% presently paid by individuals (and in the case of employees, their employers too) in the form of payroll taxes into a personally-owned investment account ( a “USA” – a Universal Savings Account)) that will grow into millions over the citizen's working life. The funds are invested in safe indexed stock funds that have historically been growing at over a 10% rate for the last 25 years.


At that rate of return a taxpayer or household making an average $50,000 per year would invest 15% per year or $7,500 and generate over a 40-year working life a $4 million nest egg. Go to the website www.theusaplan.com to review the year by year analysis of how the $300,000 ($7,500 x 40 years) accumulates, grows and compounds into a $4 million-dollar nest egg which will throw off a $33,000 a month retirement check.


As it will not require a taxpayer to invest his after-tax dollars into IRA or similar retirement plans it will cost no more than what is presently being taken by government. Americans can then use their after-tax cash to support their chosen lifestyles. The USA Plan will insure them of an affluent retirement and enough monthly income to buy the best medical care on the planet. The Plan eliminates the need to save for retirement.


As we know all private and public pension funds are all heavily invested in the stock market. By creating a vehicle to fund the growth of the private sector the investment of “USA” funds will immediately create millions of new jobs while at the same time guaranteeing the taxpayer a million-dollar nest egg at retirement. It will explode the overall wealth of the nation. The USA Plan is a short- term solution as well as a long-term solution we all are looking for.


Man has been saddled with poverty since the beginning of time. The few who were fortunate enough to be born into wealth or smart enough to accumulate it throughout history have always been a very small number of people. American independence changed all that to enable more 0f the population to become wealthy.


Unfortunately one-hundred years ago that independence permitted the people to give the right to tax incomes to the state which has been perverted into a mechanism to funnel wealth to the very few who know how to legally avoid taxation - Guys like Warren Buffet and Bill Gates whose fortunes have never been taxed because we don’t tax the appreciation in value until the stock is sold.


America has never attempted to solve the riddle of poverty but has left that up to the individual. He or she either sinks or swims AFTER TAXES. And there is the problem. By punitive taxation and suffocating regulation that raise all costs of living most Americans can’t save or work their way out of poverty. The talk of the American Dream of financial independence is just that – talk.


The Rise Up Theory of Economics as incorporated in the USA Plan will solve the riddle of poverty and generate all kinds of peripheral benefits not the least of which will be the elimination of war as soon as the Plan is adopted throughout the world.


War is not waged by people who want to protect their property.


Of course “peace on earth” depends on America leading the way and exercising leadership and resolve not to change or weaken the


USA Plan.

Rise up, America!

Income of Blacks Dropped $6,048 PER YEAR Under President Hope and Change

by Dick McDonald

When Peggy Joseph famously intoned in the last presidential election that  “Obama’s going to pay my gas and my mortgage” little did she know her blind support of Obama’s ‘HOPE AND CHANGE” would result in a 4 year drop in the  income of the average black of $24,000.  Now you won’t hear a joke about that from Dave Letterman or John Stewart because they still believe their President is working to make the poor better off.  The facts say differently but you won’t hear that from the main stream Obamamedia either. They still foolishly hope this town crier and his redistributionist Marxist policies will make the tide rise for all.  Tell that to Peggy Joseph.

I believe when history is written it will paint Obama as a tragic figure that had good intentions but went into office with flawed ideas how on to solve the country’s problems.  Remember he is the man who rode into office saying that under Bush and the Republicans that the income of average Americans was “flat” whereas the income of rich Americans was soaring. Well folks he has managed to make that “income disparity” worse not better.

 

When all is said and done we have a shrinking rich and middle class and a bloated almost poor society - made poor by policies that favor a government and its politicians over its people. Rise Up America and throw the bums out.

UPDATE: WHY OBAMA DOESN’T CARE ABOUT POOR BLACKS

If Obama and the Democrats are re-elected in November, look for 25% unemployment because Atlas will have shrugged.

Mr. President the business of America is Business NOT Government

by Dick McDonald

I take President Obama’s latest slam against small business people personally.  I was a small business man for 30 years and during that time I did over 2,000 private placements to raise the capital to feed several million cattle. During that time the only obstacle I faced was government.  If it wasn’t SEC compliance, it was tax law concerns. If it wasn’t agricultural department red tape it was slaughter house regulations.

I conducted this business as a tennis shoe cowboy in Encino CA with the help of 2 or 3 clerical help.  To tell me I had to thank my lucky stars for government’s help is pure Marxian propaganda on the part of Obama.  Government restricted and limited my capabilities and opportunities at every turn. I won’t thank government I will fight it in the future to limit its powers.

With the passage of the Sarbanes-Oxley and Dodd Frank legislation I couldn’t afford to do what I did for 30 years as it would cost me $200,000 to $400,000 for EACH private placement even before I attempted to get an investor.  No wonder start-ups have slowed and unemployment is sky rocketing; raising money for new ventures is limited to only the very wealthy who can afford the cost of these new regulations. Let’s face it, these regulations favor the very wealthy contrary to the BS Obama is selling the middle-class and poor people.

If Obama and the Democrats are re-elected in November, look for 25% unemployment because Atlas will have shrugged.

Clint Eastwood likes Herman Cain...

Eastwood — who has never voted Democrat, besides a 1998 gubernatorial vote for iconic milquetoast Gray Davis — is a big fan of pizza tycoon Herman Cain.

...and so does Dick McDonald:

In Support of Herman Cain

I just listened to Herman Cain’s press conference where he answered questions from the main stream media after categorically denying all accusations of sexual harassment by all known accusers as well as ones he expects to surface in the future. I can appreciate his dilemma as I personally observed a similar situation with a very wealthy client I had early in life. In fact I can say my client’s dilemma and his response was a life altering experience for me. After watching the pain it caused him for ten years I dedicated my life to essentially taking a vacation while I was young enough to enjoy it. It taught me never to be involved in public corporations, the stock or the real estate market.

The client was J. Paul Getty and at the time reputed to be the richest man in the world. Now his problem wasn’t sexual harassment his problem was minority shareholder suits. As the owner of over 80% of the stock and president of major public corporations he was repeatedly sued by professional scum suckers who accused him of malfeasance in office. Like so many who are sued he settled rather than fighting it out in court. His banker confided in me the “standard” $50,000 checks the man regularly wrote to settle were legion. That was a lot of money at the time.

Herman Cain has led hundreds of thousands of employees over his lifetime. His run for high office has brought out the scum suckers just like they did for Mr. Getty. The latest accused him of sexual assault – groping her private parts and slamming her head into his. Now one would think that a man so possessed as that would have had hundreds of women he raped and groped show up to ring the celebrity bell. I doubt that will happen as these accusations don’t pass the smell test. The major corporations he ran and those who elected him to be the President of the Restaurant Association and Board Member of the Kansas City Federal Reserve Bank vet their people and would never have given him those jobs if he was a sexual predator.

I still hold that his 9-9-9 plan is not the plan to transition to a small government that could be supported by a consumption tax. Of course I would oppose it as I designed The Ownership Society’s Rise Up America plan which I believe should go first.

Rick Perry – Just another RINO?

So let’s go with his instinct and ignore his cowardice. . .

Dick McDonald - Ownership Society Institute

"We will fix the Social Security system so it will be there for our young workers..."

--Rick Perry speaking to the Iowa Credit Union League on 9/16 in Des Moines, Iowa.

This is essentially a major retraction on his “Ponzi scheme” remark at the debate last week.  The USA Today poll said 32% of the people wouldn’t vote for him because of his “Ponzi” characterization so like the politician he is he joined the Democrats and Republicans like Romney to “repair” the un-repairable rather than replace the system with private investment accounts like 15 countries have done following the lead of Chile and the advice of supply-side economist Milton Friedman.

Listen folks the only repairs on the table are a combination of raising the retirement age, means testing and reducing the rate of automatic increases in benefits.  Each is a MAJOR BENEFIT CUT and TAX INCREASE.

America what are you thinking? Are we socialists or capitalists?

In Chile which has been accumulating personal wealth for its citizens in personal investment accounts for 30 years lets 55 year-olds access special computers to decide whether to retire and what insurance annuity they want to buy with their accumulated nest egg. Our politicians are about to raise our retirement age to 75.

The American system Perry wants to fix has no nest egg accumulated for its workers. So he is just another mathematically-challenged RINO in my opinion. I pray that Sarah Palin enters the race and advocates privatization of the system like we thought Perry would do.

LET’S REVIVE THE ECONOMY NOW

Chile followed the advice of Milton Freidman’s Chicago school of economics and is presently running a 7% a year increase in GDP. And what are we running – 0%. If we ran a 7% increase our GDP would skyrocket with the addition of $1 trillion of sales and services each year. That would mean that on each day of the year including Saturdays and Sundays there would be an increase in the sales of goods and services of $2.74 billion dollars we didn’t have the day before.

Now think about this. How many jobs would be created to service an increase of sales and services of $2.74 billion dollars a day? Assuming $50,000 of sales per employee then we would add 54,800 new jobs every day 24/7 or 20 million jobs annually. Assuming $100,000 of sales per job we still would be adding 10 million jobs.

In other words privatizing Social Security in Chile was a massive job creator.

AND WHAT DO WE NEED IN THE USA TODAY?

JOBS, JOBS, JOBS.

My Rise Up America plan needs to be considered nationally. It does for the poor and middle-class what “trickle down” did for the rich and as a kicker creates millions upon millions of jobs immediately. Forget that it will create a $4 million nest egg and a $33,000 monthly retirement check for the average household in the future think about saving our economy today.

Only new investment capital creates new jobs in the private sector.  Why should we have to rely on the rich to supply that capital when the people – remember those of, by and for the people – can surely invest their payroll taxes in the economy and create their own jobs.

Can we get out of the sandbox and go back to class?

Can’t we measure up to Chile.

Come on! Let’s roll!

Dick McDonald
September 19, 2011

A Solution to Our Economic and Social Nightmare

Republicans and Democrats don’t need to compromise they need to use capitalism with a small amount of social discipline to make the country far more exceptional as well as geometrically more prosperous than it is today.

This Mission Statement for the website, www.riseupamerica.com, will only scratch the surface of the mission the "RISE UP AMERICA" (RUA) plan hopes to accomplish. To those of you who have never been wealthy, many of the goals listed below may seem like an "impossible dream". But give yourself the benefit of the doubt and accept for a moment the fact that "capitalism" can make you wealthy even if you don't have the "tools" to compete for the big bucks nor the cash to invest and save to become wealthy. You have seen the 40-year tables and realize that just by working, being stable and industrious during those years, you too can become wealthy under RUA.. Now review all the societal problems Rise Up plans to solve.

• Ends endemic poverty as we know it
  
  
• Delivers the American Dream to even those that can’t compete
  
  
• Uses the capitalism not socialism to solve many of our problems
  
  
• Creates "USA's" Universal Savings Accounts for everyone
  
  
• Finally economically emancipates women through the sharing of "USA's"
  
  
• Provides retirement checks that allow retirees to live affluently
  
  
• Forces a 15% savings on citizens at no new cost to them
  
  
• Creates wealth by compounding (see the tables)
  
  
• Reduces the National budget eventually by 40%
  
  
• Immediately liquidates as much as $100 Trillion of potential entitlement debt
  
  
• Delivers the biggest tax cut in history
  
  
• Gives the disadvantaged a reason to live and care about their life
  
  
• Delivers "reparations" in the form of a USA - a personal investment account
  
  
• Reduces crime, victimization, and dependence on government
  
  
• Reduces stress caused by crime and financial difficulties
  
  
• Eliminates the need of the private sector to finance retirement
  
  
• Makes business more competitive
  
  
• Eliminates retirement costs their competitors don’t have to pay
  
  
• Eliminates the union’s need to bargain for retirement funding
  
  
• Creates "ONE" retirement account that replaces millions of plans
  
  
• Solves State and municipal pension concerns and unfunded obligations
  
  
• Energizes the economy with an immense injection of capital
  
  
• Teaches 50% of Americans about capitalism and stock investing
  
  
• Infects America with the optimism - the Shining City on the Hill"
  
  
• Reduce ethnic and racial tensions by making everyone wealthy
  
  
• An air-tight way to eventually deliver the American dream to everyone
  
  
• Brings back the market to areas convoluted by government intervention
  
  
• Makes America the banker to the world
  
  
• Gets everyone on the same page pulling in the same direction
  
  
• Infects the population with a desire to win and increase stock values
  
  
• Restores America’s confidence in her politicians

Neither opponent nor supporter of RUA can argue that what it proposes is not something the people want for themselves - real wealth, freedom of choice and the American Dream. In the plan the people are empowered and the state will lose some of theirs. Those who believe in the ability of the few to orchestrate the lives of the many are just fooling themselves. The private sector in America has proven that when all 300 plus million Americans are able to invent, design, develop and implement their ideas freely our society prospers socially and economically. That prescription has made us the economic and military giant of the planet with just 4.5% of its population.

RUA will make major adjustments that will enable the individual to reacquire the rights and freedoms lost to the emergence of big government over the last century. It will also let capitalism deliver the American Dream to those that are unprepared to compete at the level necessary to insure them of that dream. This will demonstrate to the world that capitalism is not only a system that delivers wealth to the rich but one that delivers wealth to the poor as well. What socialism failed to deliver, capitalism will. Those that refuse to allow this to happen are doomed to the ash heap of history like all social totalitarians that believe man is so deliriously weak he can be convinced to live in a world of equal outcomes for unequal contributions thereby denying his own natural instincts.

RUA will travel a bumpy road with massive opposition from those whose powers and perks will be taken from them.. There are evil men in this world who will work desperately to keep the poor, poor. When opponents put their roadblocks in the way, ask yourself how it was so simple to give “personal accounts” to politicians, Congressmen, Senators and 3.3 million Federal workers through the Thrift Savings Plan and why is it so unconscionable and "wrong" to give them to you? Ask them why these problems didn’t surface when the legislators gave these personal investment accounts to themselves and government workers?

If it was so simple then, what is the problem now? Their answer will never rise to a level that would defeat the concept that capitalism can deliver the poor from poverty; to Make the Poor Rich. In the plan the people use their own money. The Thrift Savings Plan uses your tax dollars to finance their personal accounts; and they have the gall to tell you that you can’t have one using your own money. What a group of fools we Americans have become if we let this opportunity pass. RUA hopes to empower the people and restore some control over their own lives. To give them back the self-respect and self-esteem they have lost to big government.

And lastly don’t let anyone demean the USA and its capability and its exceptionalism. We have a piddling debt to foreigners of $3.4 Trillion and a country worth anywhere from $220 to $400 Trillion. We can afford to transition to personal "USA" accounts easily. Don't let anyone fool you.

Dick McDonald
July 17, 2011

The Fair Tax Act versus A Personal Accounts Plan (for Laymen)

by Dick McDonald
Ownership Society Institute
www.RiseUpAmerica.us

Rather than get into too many complicated inter-related issues, I am writing this to make crystal clear the main (but not all) of the differences between the highly touted Fair Tax plan and the less understood personal account plan I am supporting and writing about in my book “Make the Poor Rich.”

The Fair Tax Plan

The Fair Tax Plan is very attractive. It scraps all Federal taxes and replaces them with a 23% consumption tax. It eliminates the IRS. It eliminates the need to file income, estate, gift, excise and payroll tax returns. The Fair Tax abolishes them all. Your yearly trek to your tax accountant is eliminated and H&R Block evaporates. No need for copious tax receipts and support; all that is eliminated. Tax cheats who failed to pay their taxes in order to buy more stuff get caught in buying that stuff because the Fair Tax is a consumption tax.

The Fair Tax is based on the assumption that it is fairer to tax consumption than net taxable income which is based on ability to pay. The richer you are the more you pay in our 93-year old system. The Fair Tax doesn’t care how rich or poor you are it just imposes the tax on the new products you buy. It rebates (called a pre-bate) the 23% tax on the necessities the poor buy and exempts them completely from tax as the payroll tax will have been abolished. This is a good thing for the poor, but hardly a bonanza as they are prone to consume every dollar they get.

Under the Fair Tax the rich guy pays nothing except the 23% tax on that which he personally consumes. As he has most everything already, the portion of his income and wealth spent on taxable consumables will only be a fraction of the percentage the poor and middle class spend on taxable consumables. Granted the rich man will invest in the market and create jobs and economic activity which will up overall consumption. That is a good thing but I’m afraid the ordinary taxpayer will complain that the rich get richer under such a plan and the poor and middle class stand still and pay the freight.

The Personal Account Plan

This tax reform ”personal account” plan eliminates all payroll taxes going to the government and diverts them (the 15% which is already withheld) into a taxpayer’s own personal investment account to grow over his 40-year working life by compounding into a sizeable nest egg. As compared to the Fair Tax, the account cannot be reached until retirement as the plan calls for the transfer of the funding of retirement from the government to the individual and the government doesn’t want to have people be irresponsible and spend all their savings and come back as a ward of the state. The nest egg is sufficient in size that just the income off the nest egg will provide the retiree with an affluent retirement. At death, his sizeable estate can be passed on to his children. No other taxes are repealed. However with the repeal of the payroll tax, half of the national budget is eliminated and the need for half the taxes. As those taxes are invested in the economy a substantial increase in economic activity is anticipated.

Comparison of Some of the Features:

• Simplicity
  
  Nothing beats the Fair Tax for simplicity. It eliminates and abolishes all Federal taxes and replaces them with one simple consumption tax. It eliminates the need for a sizeable IRS. It reduces the need for complicated accounting and supporting documents. It eliminates the need for tax returns and the complicated determination of taxable income. Nothing could be simpler than the Fair Tax.
  
  By comparison there would be more complications with a personal account as all taxes stay the same and payroll taxes still have to be determined and paid into an individual’s personal account. In the present Social Security system the government takes care of funding retirement and old-age medical needs. Under personal accounts this responsibility falls on an individual’s shoulders.

  Advantage: Fair Tax

• Limiting the Size of Government
  
  The Fair Tax would substantially reduce the Government’s need to administer so many taxes but HR 25, its empowering legislation, makes this “consumption tax” revenue neutral. In laymen’s terms that means that if the government collected $2.8 Trillion in Federal taxes in 2006, the Fair Tax would be designed to tax the “consumables” subject to this Fair Tax so as to collect $2.8 Trillion in 2006. Therefore it doesn’t limit the size of government to any significant extent. Politicians would still retain the right to allocate that $2.8 trillion of tax receipts at their whim.
  
  The personal account plan would cut the Federal government in half. The Federal budget would fall from $2.8 Trillion to $1.4 Trillion overnight. As the government would no longer be charged with the responsibility of funding retirement and old-age medical needs, it no longer would be in the entitlement business. It would no longer be playing nanny to its citizens.

  Advantage: Personal Accounts

• Tax Cuts
  
  As the Fair Tax is revenue neutral, its imposition would not cut the nation’s tax burden. It would merely shift that burden among the various classes of taxpayers. The poor would be exempt from all taxes and the wealthy exempt from income, dividend and capital gains from which most of their wealth presently flows. Those whose income is spent on consumption over the poverty line would be hardest hit. However, as the Fair Tax is not designed to cut taxes, it is not a vehicle for tax cuts.
  
  As far as tax cuts are concerned, the imposition of full-blown personal account legislation would result in the biggest tax cut in the history of the planet. Eliminating the need for government to fund retirement and old-age medical costs would result in a $1.4 Trillion tax cut.. Unfortunately for those who want to spend their tax cuts now, that money will be put away for them to grow into millions over the years and will not be immediately available. They will be able to direct their investment into pre-designed indexed funds but that is all. Still it is a massive tax cut.

  Advantage: Personal Accounts

• Cost and Logistics of Transition and Implementation
  
  The cost and logistics of transitioning to the Fair Tax would be daunting logistically but not too costly. As the plan is revenue neutral, the federal government would still be raking in the same dough; they would just be in a scramble as to whose ox is gored changing job descriptions and desks.
  
  The transition to a full-blown personal account modality would be painful to those who look at the problem linearly. Today the payroll tax receipts are used to pay retirees. Upon implementation of personal accounts that source of funding disappears as those funds will be placed in personal accounts. The question then becomes how do we fund the benefits of those in the system now and those whose accounts won’t have sufficient time to mature into sufficiently large nest eggs.
  
  In my book, “Make the Poor Rich,” I have at least eight methods to easily accomplish this. None may be needed, however, if history repeats itself. In the 1980s when Reagan cut the tax rate from 70% to 28% the result was that government “income” tax revenues doubled because of increased economic activity. If that happens again and there is good reason to believe it will as the stimulus of personal accounts will pale to insignificance the tax cut of the 1980s then such increase in revenues will be more than enough to pay for the smooth transition to personal accounts.

  Advantage: Fair Tax

• Unfunded Debt Reduction
  
  The Fair Tax hopes to generate sufficient activity to make a big dent in the $13.2 Trillion unfunded Social Security debt. It makes no provision for the looming $30 to $50 Trillion of Medicare liabilities. I personally am unconvinced that it adequately addresses the Social Security problem as the Fair Tax is revenue neutral and present revenues are not adequate to pay the ever-increasing unfunded liability much less reduce the existing liability. It would be necessary to run enormous surpluses under the Fair Tax to even begin to address these unfunded entitlements. Under Fair tax these liabilities remain a severe problem.
  
  The personal account plan abolishes both the Social Security and Medicare unfunded liabilities on the date of the plan’s passage. They are written off the books with the stroke of a pen. Congress is not obligated to fulfill those promises and they have proven that in the Supreme Court. They have no contractual obligation to retirees. They can repeal any laws without consequence.

  Advantage: Personal Accounts

• Retirement Funding
  
  The Fair Tax makes no provision for retirement funding. Taxes presently collected to pay retirees will remain the same and substantial benefit cuts or an increase in the 23% consumption tax will be needed to keep those programs afloat. I don’t see any significant change in the dynamics of a revenue neutral consumption tax that would in any way ameliorate the problem.
  
  The personal account plan has been devised to make the poor rich and able to afford upon retirement an affluent lifestyle and the best medical coverage money can buy just off the income from their nest egg. Your $60,000 a year truck driver retires with a $4.8 Million nest egg and a $40,000 a month retirement check (2006 dollars) without invading his nest egg. He can afford a magnificent lifestyle and buy the best medical care money can buy.

  Advantage: Personal Accounts

• Crime, Discontent and the Pursuit of Happiness
  
  The Fair Tax and its abolition of all the taxes and the bother they create will do wonders for the people. It is a step up in the pursuit of happiness. I question, however, its effect on crime and discontentment. I think it will only marginally improve either of the latter. Its revenue neutrality bespeaks of its failure to lift all boats.
  
  Personal accounts have been designed to make the poor rich; even those who by circumstance or environment can’t compete for the big bucks. It carries them into a paradigm in which they can achieve the American Dream by merely working to survive. As most crime is driven by the lack of money, personal accounts will do wonders in reducing crime. As a disincentive for bad behavior for those who commit crimes for money we will subtract their incarceration costs from their personal accounts when jailed. As the poor get wealthier, both the tenor of life and its crisis will tone down and hopefully mute. Personal accounts and the security they provide should be the ultimate reward in the pursuit of happiness.

  Advantage: Personal Accounts

• Private Sector Retirement Funding
  
  The Fair Tax abolishes the payroll tax and provides Social Security and Medicare coverage assumedly at the same level presently paid. As those amounts are insufficient to provide just enough to avoid starvation and homelessness, I don’t see the Fair Tax helping the private sector fund retirement. As it presently stands business is abandoning fixed retirement benefit plans for 401(k)s which have no mortality pool (not payable until death). The Fair Tax should provide a cushion for corporations to provide retirement plans but I doubt they will do so considering the cost that must be added to their products and services.
  
  Personal accounts are designed to provide in one place all the retirement funding an American needs. He won’t need funding from his employer or employers. He can scrap his 401(k), his IRA. There will be no need with the nest egg he will accumulate under the personal account plan.

  Advantage: Personal Accounts

• Wealth Creation
  
  The Fair Tax is not designed to create wealth. It is revenue neutral and neither cuts overall taxes nor provides for an increase in the capital pool (here we assume the rich will be freer to invest but it should be offset by a reduction from other classes who pick up the shortfall in tax collections).
  
  Personal accounts have been devised to create enormous personal wealth for American citizens; even the poor and uncompetitive will become wealthy. . Under this plan the overall wealth of America will geometrically rise to supply the world with the capital it needs to improve the overall standard of living of the oppressed and unfortunate of underdeveloped nations. Advantage: Personal Accounts FairnessIf by fairness one wants to rid themselves of bothersome details, the Fair Tax is your number. However, as between classes of taxpayers I have concluded the Fair Tax is anything but “fair”. Were it not revenue neutral and created huge surpluses with which to liquidate our unfunded debt. I would feel differently. As it is, it loses my vote. This is of course predictable as it is my passion to implement personal accounts at 15% of income and wages and I am exceedingly biased. I leave it to the Fair Tax crowd to challenge my findings and my conclusions. I doubt they will be sitting on their hands.

  Advantage: Personal Accounts

• Legislative Potential
  
  Neither Fair Tax nor Personal Accounts legislation will go down without a massive battle with the establishment as both are designed to free the individual from the yolk of government. The forces of government are massive and impressive. Fortunately they already have personal accounts which I will use like a rapier to impugn their character and honesty with the American people. I predict they won’t get away so easily this time;. George W. Bush won’t be running interference.

  Advantage: Personal Accounts.

If you really believe in America, read this

The Ownership Society Institute (OSI) has been claiming that its Rise Up America (RUA) plan to reform the US Government, kick-start the economy, immediately eliminate over $100 trillion in unfunded US debt and deliver the American Dream of financial independence to every American is the route the political parties should be taking rather than the present slash and burn Republican plan to cut benefits, services and safety nets or the totally irrational spending spree the Democrats are planning to pursue right into Federal as well as state, county and city bankruptcy.

For those of you unfamiliar with the Rise Up America plan it is based on a simple tax shelter device used by the wealthy that has allowed the likes of Bill Gates and Warren Buffett to amass $50 billion fortunes without so much as paying one dime in income tax. The device is simple – the appreciation in the value of their stock is not taxed currently – or ever if they don’t sell shares and pay the 15% capital gains tax. RUA by privatizing the entire 15.3% of annual payroll tax and allowing it to be placed in an unreachable investment account and invested in the stock market for every taxpayer’s working life will enable every American to become a millionaire at retirement. See tables here. The appreciation in their stock over the years will enable them to escape the current taxation of their gains.

From the chart below one would have to be delusional or fatally partisan not to believe that this is the moment for the people to jump on the RUA bandwagon and institute the RUA plan at every level of government. The expectations for stock market returns after inflation will be over 11% which if it holds would mean the average American family ($50,000 annual income at today’s price levels) would generate a $14, 200,000 nest egg after his or her 40-year working life. Now this sounds too good to be true but that is what the calculator tells us. Remember in 2006 Warren Buffet made $833 million each and every month for the entire year as that was the result of his accumulating stock the appreciation on which he paid no tax. RUA merely adopts that shelter to make the poor rich and the rich ever so much richer.

Dick McDonald, General Manager
Ownership Society Institute
April 6, 2011

Does one man have the answer for America?

I emailed Al Martinez (The Daily News) twice about my friend Dick McDonald...and look what finally happened today!

Al Martinez: "Does one man have The Answer for America?"

PS: Dick has a free e-book on his website called "Make The Poor Rich and America Wealthier" that is over a hundred pages of specific details that show why his plan will save our country. (Please forward to your lists and spread the word!)

SAVING OUR ECONOMY

LACA (Los Angeles Conservatives Alliance) interviews Richard McDonald

Reseda, CA 1-11-11

Over the next eleven months, LACA will be featuring a series of articles by the Ownership Society Institute. They will outline a plan the Institute calls Rise Up America (RUA). This plan has been designed to change the way the United States government works in a manner that will substantially increase the material wealth of the nation and each individual as well as their social well-being.

LACA: Our series is authored by Dick McDonald (DM). Dick believes conservatives should adopt RUA to solve many of the economic and social problems the country faces. Please tell us something about yourself and your RUA plan.

DM: I am retired now but I spent my working life as a tax man helping rich people avoid taxes. As a young CPA working for an international accounting firm I did the personal and corporate income taxes for very rich clients like Jimmy Stewart and J. Paul Getty. After ten years there I spent the next 30 years designing and operating tax shelters.

For the last six years I have been perfecting the RUA plan that does for the poor and middle class what Ronald Reagan’s so-called “trickle down” economic theory did for the rich. In other words it creates wealth for the little guy. If adopted it would create enormous wealth for the country as well.

LACA: Dick your background sounds impressive but just how does doing tax work for billionaires equate with creating wealth for poor people?

DM: That is simple. It is so simple that it escapes most people’s radar. I use the same tax shelter for the poor and middle-class people as a tax man uses for the ultra rich – the non-taxability of appreciation in the value of stock. Think about it. Bill Gates is worth $54 Billion in the latest Forbes survey. He didn’t pay income taxes to create after-tax wealth of $54 billion. His wealth is in the stock of Microsoft. He didn’t pay tax on the appreciation in that stock.

LACA: I see where you're going – most people don't think of appreciation as a tax shelter. I see how rich people use it but how can your plan generate wealth for the poor. They don't have the money to invest in stock.

DM: You're right – they don't – and that is where my plan begins. Today the country needs a kick in the economic pants. We need jobs and a better growth rate. But no one is hiring and few are investing in new products and services. So my plan calls for an annual investment (from the private sector) of over a trillion dollars in the stock market. In the first year it should create millions of jobs and jump the country's growth rate towards 10%.

LACA: Dick that's a great idea but where are the poor and middle class going to get new investment capital of a trillion dollars each year.

DM: Here again that is relatively simple – we privatize the Social Security, Disability and Medicare programs, place the 15.3% of payroll taxes in each taxpayer's personal investment account and have it immediately invested at their direction and for their sole benefit into secure index funds for their 40-year working life.

LACA: Wow – that brings up so many questions we don't have time to cover all of them today. But let's take some obvious ones. First there is a great fear of investing in the stock market. How do you overcome that fear.

DM: First of all the average American household makes over $50,000 a year and pays slightly over $7,500 in Federal payroll taxes. Over a 40-year working life they would have invested $300,000 with the government. However such taxes invested weekly in the stock market grow into a $4 million nest egg through accumulation and compounding. The rate of return we use is the same 10% average rate of return the S&P 500 has returned in long-term 40-year investments since 1871.

Now when the recent stock market crashed and the $4 million dropped to $2 million, the taxpayer only had invested $300,000. He was still way ahead of the game. As the stock market has gone from 12,000 on the Dow to 6,000 and returned to 11,500 the taxpayer's account has come almost back to $4 million. The citizens understand simple arithmetic – they just have to be informed.

A $4 million stock account should throw off a $33,000 a month Social Security check which will make a mockery of the $1,300 the government presently pays. On top of that the taxpayer is worth $4 million whereas under our present system they get no nest egg.

LACA: I'm sorry we only have space for one more question. Presently the payroll taxes collected by government are used to pay current retirees. By abandoning these entitlements what happens to current retirees and where will the money come from to pay them.

DM: Our plan will immediately reduce the over $100 trillion unfunded entitlement debt to a manageable $6 to $8 trillion as the growth in each account will eventually eliminate the need to fund retirees. In the meantime we can fund the benefits by privatizing unneeded departments of the government, selling and leasing back government properties such as lands, buildings and rights (oil, airtime) and a myriad of cost cutting steps. We also can borrow a little as we have made such a massive dent in the overall debt of the country.

The increase in economic activity will swell to the point that the private sector will open jobs up to absorb the government workers displaced by privatization. It can be done.

LACA: I'm sorry we'll have to continue next month. Where can the readers presently get more information about RUA.

DM: They can go to www.ownershipsocietyinstitute.com. Your readers should be aware that many benefits emanate from such a plan including cutting the size of the government by 40%.

Healing the Nation

by Dick McDonald
Ownership Society Institute

The American people are on to politicians and they don’t like what they see. And what they see is a daily diet of talking points that are only 1% solutions at best to their 100% problems. A diet that consists of ideological issues of small versus big government, socialism versus capitalism, deficits versus surpluses, entitlements versus privatization, job losses versus job creation and a whole host of peripheral issues that aren’t of the slightest interest to average Americans.

What the average American wants is a better standard of living for himself and his family and a way to achieve the American Dream of financial independence. Unfortunately they got a Democrat who promised to fulfill those dreams but turned out to be a tax and spend socialist who can only deliver what he steals from the rich and productive elements of society. He turned out to be a one-trick pony just like all totalitarian-socialist dictators are.

So how do we heal the nation?

The Democrats claim to socially represent the underdog in America but in reality tax them unmercifully with payroll, sales, energy, property taxes and in some cases income taxes. Tax them to the point they can’t save a dime. The Republicans, on the other hand, support the rule of the jungle – survive on your own or die. Neither party has done anything significant in decades to elevate the prospects of the underclass.

The Democrats promote bigger government to impose their policies; Republicans pretend to champion small government. However, to really understand how to heal society we have to contend with the libertarians – they want no government control of any aspect of the citizen’s life. And that is the building as well as the stumbling block to crafting a solution for our national problems.

As a starting point let’s take aspects of the Democrat and Libertarian views and compromise. The Democrats want the common man to thrive (those Democrats, Socialists, Communists that are really interested in delivering the “common good”) so let’s privatize payroll taxes and give each taxpayer back the 15.3% in taxes he pays. That will satisfy the Libertarians too – it will get the government out of the individual American’s business.

However, the Democrat will rightly point out that ordinary Americans are not prepared to invest in their future and in most cases will spend all that 15.3% currently and not save a dime. Eventually they will become a ward of the state and make the privatization of their payroll taxes a useless exercise.

This is where the Libertarian will have to compromise with the Democrat and restrict the individual from spending that money during his lifetime and put it in a non-governmental trust to accumulate and compound into a sizeable nest egg for retirement. Although the taxpayer can’t use the money before retirement, it is his and no one else’s.

Now having done the “common good”(satisfying the Democrat) and freed the individual from confiscation by the state (satisfying the Libertarian) – the Republicans and their capitalism come into play. By privatizing the $1.3 trillion in annual payroll taxes and investing them in the stock market the economy will explode and send the market indexes like the DOW and the S&P 500 right through the roof.

Tens of millions of jobs will be created by the private sector.

More importantly the people will have a Congress that worked for them. The average household at today’s prices will accumulate a $4 million nest egg at retirement and $33,000 a month retirement check. Today the average American can look forward to a monthly Social Security check of $1,300 and no nest egg whatsoever.

Now there are those that say the market is too risky – “look what happened to the DOW”. It is down to 10,000 from a high of 14,142. What these critics forget is that a 40-year investment started 40 years ago with the DOW at 800. The average rate of return is approximately 10% per year for 40-year cycles since 1871. So much for “risk”

Then they will say we can’t afford to pay off everyone under the old programs. That is nonsense. Privatizing these programs will generate enormous economic activity and increase “income tax” receipts to the point the excess generated can pay off older participants within three years. Remember privatizing will immediately extinguish today’s $111 trillion of unfunded debt upon enactment.

With one national pension plan the cities, counties, states and the federal government will be free of those costs and able to survive the current bankruptcies they have created. Look – instead of a $15,000 Social Security pension the average household would be looking at a $400,000 a year pension. Even those government employees that enjoy $100,000 a year pensions would greatly benefit by privatization.

The Ownership Society Institute (OSI) has developed a complete plan, Rise Up America (RUA), to increase retirement benefits and rapidly create wealth for all Americans. You can access this plan here or type www.riseupamerica.us into your browser.

America is going transform. It is just a matter if it plans to implode in terminal socialist bankruptcy or thrive in capitalist-delivered wealth.

Social Security Goes into the Red in 2010 not 2018

by Dick McDonald - Ownership Society Institute

In 2010 the Congressional Budget Office has projected a $92 billion surplus of payroll tax receipts over Social Security benefits paid. That figure includes $120 billion in “non-cash” receipts of fictional interest paid on fictional US Bonds – a bookkeeping trick like Enron used to cover up Congress’s theft of over $4 trillion of excess payroll tax receipts it has been appropriating from Social Security since the early 80’s. See here.

http://finance.yahoo.com/focus-retirement/article/108747/next-in-line-for-a-bailout-social-security?mod=fidelity-readytoretire

That means that by September, 2010 the US Government will need a $28 billion cash infusion just to meet its Social Security obligations. So much for the age-old denial that Social Security isn’t broke. That it has unfulfilled promises of over $14 trillion in future benefits in excess of projected receipts. Similarly Medicare is in the tank for $93 trillion. The jig is up and the Democrats and RINOs have no where to go on this issue.

The real benefit to be gleaned from this is that Americans will seriously try to solve this problem by any means other than raising taxes and/or cutting benefits. Believe me Americans will insist on it. The baby boomers will demand their full benefits as they come on stream in the next 15 years and the kids will resort to violence if they are unfairly taxed because it will take 2 kids to support one retiree

President Obama has challenged the Republicans to come up with some ideas to solve the dilemma and the best they came up so far is Paul Ryan’s proposal to raise the retirement age to 70 years (benefit cut of major import), cut the Medicare benefits (benefit cut of major import) and allow a small portion of a worker’s payroll taxes be invested in a personal investment retirement account (step in the right direction).

The real tragedy is that current benefits don’t begin to cover retirement costs and trying to save these entitlements is merely rearranging the deck chairs on the titanic. What Americans want and will insist on is a re do of the funding of retirement costs so that more than the solvency of the government entitlement programs is achieved. Bush limited his Social Security reform to solving the solvency issue – Ryan appears to have limited his approach to solvency as well. There should be no limitations placed on what Americans can do in solving this issue.

We at the Ownership Society Institute (OSI) recommend these entitlement programs be scrapped with the proviso that the government guarantee that all benefits under them will be honored and form the floor under which no future benefits can ever fall.

In place of these programs we institute personal investment accounts we like to call “USAs” – Universal Savings Accounts. That into these accounts the entire 15.3% of payroll taxes presently sent to Congress will be redirected and immediately invested in the stock market for the 40-year working life of every taxpayer. The details of OSI’s plan are outlined here. It is called the Rise Up America plan.

In addition to solving the solvency issue RUA does the following:

· Generate the biggest tax cut in history

· Reduce the size of government by half

· Alleviate poverty and economically emancipate lower class citizens

· Infuse enormous sums directly into the economy and accelerate growth

· Eliminate the need for government pensions and Medicare

· Pay off $110 trillion of unfunded Social Security and Medicare liabilities

· Give back to Americans the money that they earn

· Increase the economic opportunities of all Americans

· Avoids Bankruptcies of cities, counties and states from pension liabilities

· Makes everyone a shareholder and responsible for oversight

· Reduces crimes especially those triggered by poverty

There a hundreds of other benefits of privatizing the entitlements but let’s leave it to a simple example.

The average American household makes over $50,000 a year and pays more than $7,500 in payroll taxes. Under RUA those taxes are placed into a USA and immediately invested in the stock market for 40 years. The $300,000 (40 years times $7,500 a year) grows into a $4,004,000 nest egg because of the magic of compounding. Just the annual income off that nest egg will generate a $33,000 a month retirement check – more than enough to support an affluent lifestyle.

RUA uses the principle of small government and takes away from government the responsibility to fund entitlements. It relies on the words of Alfred Einstein as everyone should. “The most powerful force in the universe is compound interest.”

All those concerns about such a sea change in the way the government does what its citizens will want is explained at www.riseupamerica.us including how to simultaneously fund the transition, place $1.3 trillion into the stock market annually, pay benefits under the old programs and miraculously enough increase the value of the US dollar. See here.

Rescuing Blacks from the Slavery of Dependency

Dick McDonald Ownership Society Institute

On his program yesterday Fox’s Glen Beck was criticizing Democrats for the debilitating effects of big government dependency on the African American community. One of the all-black panelists put forth the idea that the disintegration of the black family may have been the root cause for the increase in dependency inasmuch as only 20% of black children were born out of wedlock in 1960 whereas today that figure has sky rocketed to 80%.

Glen noted that Bill Cosby had brought this up before but got hammered for it. He asked Brandon Brice (a community organizer and a Republican) for his comment. Brandon opined that Cosby had called for black males to be more responsible - he then made a 360 departure, changed the subject and said the following:

The more important thing when we look at things as Republicans and conservatives and when we talk of the fear of big government we have to remember that big government whether you like it or not - it’s the perceived notion that they are taking care of much of low income America right now especially at this time of depression. Maybe the solution should be a smarter and more responsible government and I believe that if that happens what you will have – you will shift to automatically smaller government because it will be based on principle. Right now much of the low income neighborhoods are dependent on this so you can’t speak against something that is supporting the lower masses whether you like it or not.

The community organizer hit it right on the head. Unfortunately it flew right over Beck’s. Brice opined that a smarter government would use principled legislation which would naturally result in a smaller government. Voila- an economic solution to poverty. That is what our Founders bequeathed to us. If the government were smaller the taxes taken from the people wouldn’t be so great and they could use that extra money to grow the economy and create and compound their own wealth.

Unfortunately instead of pursuing an economic line of reasoning Beck and the panel headed off into a rehash of the “social” effects of dependency. They eventually compared the black community to domesticated dogs who had to rely on their owners because they were never taught how to survive on their own. What a sad analogy – and from an African-American panelist yet.

The panel didn’t pursue how being smarter and more principled could possibly lead to an “economic” solution to poverty and the eradication of this endemic condition in so many parts of the black community. It was just another chance Beck missed to uncover a solution – a wall he butts into almost daily.

To change a cultural dynamic like poverty you have to have a reason for blacks to make a change. So why in the world would the black community presently vote for Republicans when Republicans have nothing to offer but the admonition to be “responsible”? Do Republicans believe they can shame blacks into voting to cut off their free food, free housing and free health care by proving that Democrats are corrupt capitalists posing as socialists? It hasn’t worked in the past and it won’t work in the future save a massive change in the Republican political arsenal. Today Republicans are not even a perceived threat to blacks as they have been accommodating blacks for years by appeasing the entitlement cabal that has run up a $118 trillion debt.

So what is a smart principled legislature? Well it is one that knows a $118 national funded and unfunded debt is unsustainable and moves to extinguish at least the $110 trillion portion that represent entitlements. It would repeal and replace entitlements (or the “free stuff”) with programs that use capitalist principles to eradicate poverty, lower taxes and increase benefits. No matter how daunting a task this appears to be on the surface, it is doable today without sacrificing the relatively paltry benefits government presently doles out in entitlements nor cost a dime more than the taxpayer presently pay. The people would continue to be paid their full entitlement benefits required by law today as they would be legislated as a “safety net” under which no future benefits would fall. .

Increasing benefits like Social Security’s monthly check from $1,000 to $33,000 seems like a pipe dream. How could a legislature do that? Actually it can be done quite simply by removing the government from the equation - by privatizing Social Security, Medicare and Disability and letting the taxpayer keep the 15.3% in payroll taxes presently confiscated from him or her and letting them use those funds in a personal investment account to grow and accumulate over the years into a nest egg. Let’s take a simple example.

The average American household presently makes over $50,000 a year. That means they pay over $7,500 a year in payroll taxes. Over a 40-year working life that $7,500 amounts to a contribution of $300,000 to the government for which the taxpayer gets no nest egg. However, if those payroll taxes were the taxpayer’s own money and invested weekly in the stock market for 40 years the average nest egg accumulated would be $4,000,000. Just the earnings off the $4 million in the 41st year would equal $33,000 a month.

If you doubt these figures go to the tables on www.riseupamerica.us and review them. Even low-income taxpayers will end up with million-dollar nest eggs and tens of thousands in monthly retirement checks. As a policy matter individual and national wealth will accumulate and grow as it is willed from one generation to the next. We call the plan the Rise Up America plan (RUA) and the personal investment account a “USA” - universal savings account. It will end endemic poverty in the black community.

RUA and the USA are the type of tools it will take to motivate blacks to vote for Republicans and vote for capitalism. Today we have blacks like Oprah Winfrey mistakenly touting Denmark and its socialist government as the answer black Americans are looking for. When the richest black woman in America who has reached that pinnacle through her understanding and use of capitalism starts promoting socialism Republicans should wake up to the fact that they need to offer the black community more than an encouraging word to be more responsible. They need a pocketbook issue like RUA. It can be the one that ends black dependency on government.

The Magic Transition: a plan to save America

by Dick McDonald

When I tell people that the Rise Up America plan has a way to simultaneously
1.

place $1.3 trillion in payroll taxes annually collected by the government into personal accounts owned by the tax payer and immediately invested in the stock market to ignite the creation of new businesses and jobs,

2.

pay $1.1 trillion in Social Security and Medicare benefits to participants, and

3.

magically increase the value of the US Dollar heretofore crippled by the overuse of the printing press

I get looks that can best be described as “Are You Nuts?”

So I best explain.

OK, let’s start with a fictitious country where we pretend it is worth $400. That is all its cash, bonds, stock, real estate, its ports, airports, roads, bridges, corporations, businesses – in fact all tangible and intangible assets owned by the private sector and the public (government) sector total $400.

Now let’s assume the people make $14 a year but after $3 in taxes they spent every dime leaving no money to invest in the economy. So the government decides because it is a capitalist economy to print $1 dollar every year for the next 40 years and give that dollar to the people and let them invest it in the stock market.

Because the way capitalism works the people would get a return investing in the stock market for 40 years. For the last 30 years the S&P 500 stock index had an average annual return of 12.8% so let’s assume the return the people of our fictitious country got was 10% annually. Under those circumstances the $1 invested for 40 years compounds into $443 at the end of 40 years.

Now let’s compare the results. Every year for forty the government printed $1 dollar for a total of $40 dollars. The investment by the people of those $40 dollars increased the assets of the country by $443. So we can conclude that there was a small devaluation of the dollar - $40 over 40 years – whereas there was an immense increase in the country’s net worth of $443, Quite a bargain wouldn’t you say?

Investing is the trick –The simple truth this example illustrates is that investing money increases value of a country even if you invest money you print. A country who’s net worth increases has a currency worth owning from an international a trader’s standpoint.

Consuming is at fault –The reason the value of our dollar has fallen regularly ever since we went off the gold standard in the 1930’s is that we insist on printing money to pay for our mistakes. The most recent example was our use of the printing press to enable the banks to lend money to home buyers at 1% which has resulted in a 40% fall in the value of the dollar. It has been a costly mistake the government supported. We needed help out of a recession but we didn’t need to leave the door to the vault wide open.

The magic transition –

Now – it is as simple as this. We take $1.3 trillion in payroll tax receipts, put them in the taxpayer’s personal accounts, invest them in the stock market and start the compounding miracle of $443 for a $40 investment. Simultaneously we print $1.1 trillion in new money and pay retirement benefits. As the recipients will be dieing off during that 40 year period and others will be self-funding their needs from the income off their personal accounts we will never print the entire $40.

Increase in the value of the dollar –Establishing an economic policy wherein investment in the country is the tool used to create wealth can only convince international traders into bidding up the price of the US Dollar.

It is just as simple as that.

A Historical Clue –

It has been the international socialist movement that has encouraged consumption and the confiscation of property from the productive elements of society. Unfortunately the free market capitalists have failed to fully support the investment principle and have too long tolerated the inflationary effects devaluations have fomented because socialists always spend more than they have.

It is time America wakes up to the fact that socialism is a failed economic philosophy and adopts Rise Up America’s plan to vault the USA into the 21st Century.

RISE UP AMERICA!

Dick McDonald: Only Super-Religious Muslims Kill Innocent People

From Dick McDonald: I sent this out earlier today before the AP article hit. There now is no question that this was a mainstream Muslim paying his dues to get into Islam’s heaven by killing innocent people while shouting “Allahu Akbar”.

Ft. Hood suspect reportedly shouted `Allahu Akbar'
AP - Soldiers who witnessed the shooting rampage at Fort Hood that left 13 people dead reported that the gunman shouted "Allahu Akbar!" — an Arabic phrase for "God is great!" — before opening fire, the base commander said Friday.

Dick's earlier article:

Only Super-Religious Muslims Kill Innocent People

Dick McDonald

The NYT this morning did not draw attention to the fact that the Fort Hood mass murderer was a Muslim – obviously one who believes in killing “infidels.” No matter what trumped-up rationale the media uses to blind Americans of the threat Islam poses to the world, the fact remains the media rather than scolding and “spanking” the Muslim faith for not reforming their religious fanatics and texts has embolden them to believe that the West’s culture and resolve is weak and ripe for a takeover. As in everything important the media weakens America rather than strengthens it by using the art of omission. To wit, buried in the far reaches of their lead story the Paper of Record had this to say:

The Muslim Public Affairs Council, speaking for many American Muslims, condemned the shootings as a “heinous incident” and said, “We share the sentiment of our president.”

Excuse me! They “share the sentiments of our president” which leaves a big question in an American’s mind. America’s current president was (or is) a Muslim. He has spent $1.4 million on lawyers closing every record of his past from grammar school through law school from review by the American public. We have no idea who Barack Obama really is other than the fact he wants to redistribute wealth and enjoy the good life power conveys on a super successful politician.

The only religious text that sends the believer to heaven if he kills non-believing innocent men, women and children is Islam’s Koran. It is time for Muslims to reform it and join the human race. They need to discipline their own. The Fort Hood killer could only believe as radical Muslims do that an act of violence that kills husbands, brothers and children of non-believers was religiously justified.

This mass murder was the result of Islam’s failure and the failure of our media to make the offenders of society accountable for their actions. Islam’s refusal to reform and its continuing offensive to return their “caliphate” to Earth is the fault of Americans who believe all religions are equal – they are not. There is one which believes that the end justifies the means and delivered the Fort Hood massacre – there are no other reasons – just trumped up excuses.

Let’s Finish Off Socialism

Dick McDonald, Ownership Society Institute
www.riseupamerica.us

Over 200 million Americans marched in spirit along with the 20 million Tea Party participants today all over America. They marched today against socialism, the President, the Administration, the media, academe, ACORN thugs, SEIU goons and a Democrat-controlled Congress that has been passing anti-American, anti-capitalist, anti-free market laws and regulations that Americans violently oppose.

Americans have never tolerated anyone much less a President of the country that calls them names and says he is going to change America to his idea of what it should be. That is not what America is all about. The people say what will be.

Over the last several months Americans have come to realize their Great November Mistake. They elected a man who plans to take property from the productive and redistribute it to the unproductive in concert with principles of Karl Marx and the communists except in cases where his financial supporters are concerned – he is mainlining taxpayer’s hard earned money and property directly to them in a corrupt and criminal way.

President Obama, their old lawyer, allocated ACORN, a criminal conspiracy that is up on voter fraud in over ten states, over $8 billion of stimulus money because they helped elect him. Well this week 20 year old Hannah Giles ripped that $8 billion from the hands of those criminals by playing a prostitute and pulling off the greatest sting operation in American history. ACORN was immediately dropped by the Census Bureau and if any Federal funds ever go to ACORN again the people will punish Obama and his party unmercifully at the polls in 2010. They may even try to impeach him if he tries to pull that stunt again.

The President made a speech on Wednesday where he told so many lies Congressman Joe Wilson lost it and shouted out that the President lies. Magically the loophole that would allow aliens to get free health care under the proposed bill the Congressman was referring to was immediately closed by amendment the next day.

If nothing else the Democrats are on the run. The American people will not tolerate having their freedom, liberty and most importantly their property confiscated by radical Marxists socialist communist leftists. It just isn’t going to happen any more. They have had enough of even the semi-socialist nonsense.

The question we at the Institute pose now is why not rid ourselves of socialism and socialist practices once and for all. Let’s strike while the iron is hot. Republicans, Democrats and Independents who are opposed to socialism should adopt the Institute’s Rise Up America plan and return the control of the government back to the people along with half of the taxes we presently pay.

The plan while destroying socialism will simultaneously revive the stock market and the economy, extinguish the $59 trillion in entitlement debt, deliver the American Dream of financial independence to ordinary Americans and trigger the greatest period of wealth creation the planet has every known.

The people need a banner to fly under. The tea parties lack a unifying cause to champion. I suggest the Rise Up America plan and the “USA” the Universal Savings Account where the future millions of all Americans will be accumulated.

If activist Hannah Giles can save us $8 billion just posing as a prostitute and Joe Wilson can save us literally hundreds of billions in health care costs by publically calling the President a liar then why do we shrink from taking down socialism, communism and other collectivist practices. It only seems like the rational thing to do at this moment in history.

Think of all the people we will rid ourselves of in Congress – Reid, Pelosi, Waxman, Dodd, Frank, Durbin, Conyers, Sharpton, Watson, Waters and 200 other losers.

Why not attack and take them down now? If not now, when?

Please go to our site and help out!

www.riseupamerica.us