Tag: Trump

What No Tax on Social Security Really Means

Did all of my fellow Social Security recipients do a victory dance (at least figuratively) when the One Big Beautiful Bill, or OBBB, passed including the No Tax on Social Security provision? Well, we did get the biggest-in-history tax break for seniors. But, sorry, almost all of us will still be taxed on Social Security. Let’s see what’s really in the Bill.

The OBBB was a long-shot from its beginning considering the slim Republican margins in both the House and Senate. Thus, the legislation was crafted by the President’s Administration as a reconciliation bill, a partisan procedure used sometimes to avoid a Senate filibuster. A filibuster would require a 60% vote to stop it and pass the bill in the Senate with at least a 51% vote. However, reconciliation also limits what laws can be changed including Social Security. So, Trump’s insistence on eliminating federal taxes on Social Security had to be done by other means.

Reconciliation procedures do allow for the inclusion of new or revised tax deductions beginning with the 2025 tax year. Therefore, the bill provided a temporary tax deduction for most seniors. I say temporary, because the deduction expires in 2028. Hopefully, it will be reinstated at that time. Impact assessments are that 88% of Social Security recipients 65 and older may deduct an additional $6,000 per person with incomes below $75,000 per year, or $12,000 per couple with earnings below $150,000. These deductions phase out for incomes above the the maximums indicated. Government calculations are that, for almost 90% of seniors, this extra deduction will more than offset the federal taxes that will still be levied on Social Security. Most states don’t tax Social Security.

Although, most seniors are grateful for the additional tax deduction, it is disingenuous to hype the Bill as ensuring “no tax on Social Security.” Those above the income cap will lose some or all the deduction and still pay the tax. Some at low income levels, who do not pay any taxes, will not receive the deduction. And, in everyone’s case, it only lasts four years if not extended. I would prefer the Administration and Congress call it what it is rather than playing name games. The Bill really has nothing to do with Social Security. If you choose to receive Social Security at age 62, you don’t get the deduction until you’re 65, but, if you choose to wait until you’re beyond the collection age, you still get the deduction on reaching 65.

I believe the better way to handle Social Security tax is to eliminate income tax altogether. All things considered, in my opinion, federal government operations should be funded with some kind of consumption tax. Why do Americans have a disincentive to earn and save along with an incentive to buy? The value-added tax (VAT) or other forms of consumption tax are often criticized for being regressive for lower income people. That can be rather easily offset by vouchers, exemptions, or other means to level the playing field. While we’re at it, let’s get rid of local real estate and property taxes which punish home owners and vehicle buyers with never-ending taxes.

The best legislation for Social Security is to reform the entire program, making it self-sustaining instead of going broke after 2034. Several very good plans for saving Social Security have been proposed including raising the minimum age for recipients, including investments in a hybrid contribution plan, means testing for different levels of payout, etc. Something has to be done, but Congress has not grown the backbone to tackle the controversial issue. We need to keep the pressure on Washington, or Social Security is not going to work for anyone in less than a decade.

So, my fellow chronologically advanced friends and loved ones, let’s celebrate the OBBB, but don’t lose sight of what it really does and does not do for us regarding Social Security.

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1

How We Lost Our World Status in One Presidential Term

Half the American population knew that, when Biden was elected president in November 2020, we were in for troubled times in our nation. But I doubt hardly anyone could have imagined how far we have fallen since the January 2021 inauguration. We have the weakest president and vice president since the 19th century. The two latest examples of this do-nothing duo are their responses to Iran’s second ballistic missile attack on Israel and the port workers’ strike this week.

Beginning the day he took the oath of office, Biden signed over 60 executive orders in the first 100 days, overturning Trump’s policies that had brought great success, prosperity, and protection to our country. Later that year, Biden ordered the abrupt and bungled withdrawal from Afghanistan disregarding the counter advice from his military leaders. Thirteen American soldiers were killed, and the Taliban immediately took over the abandoned country while our allies rolled their eyes in disbelief. Then, sensing our weakness and incompetence in Afghanistan, Putin invaded Ukraine with no fear of our retribution.

At the beginning of 2023, a spy balloon determined to be from China was allowed to fly over our entire country without challenge for eight days until its mission was complete. Despite innumerable demands to shoot down the intelligence gathering craft, Biden, fearing China, failed to destroy it until it was well off the east coast. On October 7 of last year, Hamas brutally attacked thousands of concert attendees, massacred over 1200 innocent Israelis, and took 240 hostages. Israel’s year-long retaliation strikes against Hamas’s strongholds have been met with repeated warnings from Biden and Harris to avoid any collateral damage and to cease fire.

Iranian-backed Houthis from Yemen entered the fray with continuous missile attacks on commercial shipping in the Red Sea, on Israel, and on American military bases in the area. The Biden response, other than a few insignificant counter attacks, has been to send hollow warnings to the terrorists.

After Hezbollah rained scores of rockets on northern Israel, Israel took out several Hezbollah and Iranian top leaders. This drew two ballistic missile attacks from Iran totaling about 300 missiles. Biden, instead of encouraging Israel, repeatedly called for Israel’s restraint. Currently, Israel is readying itself for a major retaliatory strike on Iran, perhaps including its nuclear weapons development. The Biden administration is ramping up its pressure on Israel to not escalate the war and to keep any retaliation “proportional.” The U.S. has given no hint of significant military support of our most faithful ally in the Middle East.

After two attempts to assassinate Trump, the FBI has arrested Iranian terrorists in the US with the objective of killing top political leaders. More recently, federal authorities discovered hackers with Iranian ties have gained access to Trumps private campaign emails. Iran’s known involvement in attempted assassinations and election interference is justification for a serious military response. Yet, the Biden-Harris administration has done little more than make meek comments of disapproval.

These are just a few examples of the embarrassingly timid leadership of our president and vice president. They are a threat to our national security. Our Middle Eastern enemy nations only respond to power and are emboldened by the weakness of their adversaries. American deterrence of enemy activity no longer exists. The present administration is the polar opposite of the former Trump administration regarding international relations and national security. There were no new wars or even credible threats of wars during the Trump years. All nations respected the powerful influence and the will to use military action that was characteristic of President Trump.

Kamala Harris has the same spineless leadership character as her mentor, Joe Biden. But her experience in international affairs and world crises is zero. With her at the helm of our nation, we would be extremely vulnerable. She is totally unqualified for the job of leading the free world. From a national defense perspective, she would be the weakest president in our history during this time of peak threats to our nation.

Unlike most former vice presidents, Harris had only one recognized project in her entire term–to work the illegal immigration problem. She was a complete failure. She has absolutely nothing to show for her time as VP. Friendly nations are dumbfounded by our inability to control our borders. Enemy nations see it as further confirmation of our declining fortitude.

In addition to our milk toast approach to the Middle East crisis, Biden and Harris have been silent in the port workers’ strike that will further degrade our economy by billions of dollars a day. Biden and Harris are paranoid about getting crossways with the labor unions . Meanwhile, Americans continue to suffer from the Administration’s inflationary economy and product shortages.

There is no doubt in my mind that, if Trump had been president during this term, there would have been no Afghanistan troop deaths or Taliban takeover, no Ukraine invasion, no Hamas massacre, no Hezbollah attack, and no attacks from Iran and her proxies. Instead of the world being upside-down and on fire, there would be global peace. Trump would have also implemented a cooling off period for the port workers’ union. Inflation would be under control, and our borders would be secure. If Trump is elected president, he will immediately gather our allies’ support to once and for all render Iran impotent and rid the world of the radical nation’s nuclear program. Peace will come to the Middle East…if it’s not too late by then.

There is no place in American government and culture for a radical socialist, weak, and inexperienced Kamala Harris as president. We might not survive four more years of Biden 2.0 with an unqualified president. The free world deserves better from its leading nation, America. We MUST correct the mistake in November!

4

Trump’s Unprecedented First-term Accomplishments

U.S. President Donald Trump

Donald Trump has accomplished more to benefit the American people in his first term than any other first-term president. You have seen various lists of these accomplishments. Here is a quick-read, condensed version of just the top 100 of these accomplishments for you to share with others.

  1. Creation of Space Force
  2. Violent crime fallen every year in office until the present senseless riots
  3. Killed Islamic terrorist leader Qasem Soleimani
  4. U.S. became the world’s largest producer of crude oil
  5. Required all pharmacists to share money-saving information
  6.  “Allow States and Victims to Fight Online Sex Trafficking Act” (FOSTA),
  7. Low-wage workers benefited from higher minimum wages
  8. Biggest wilderness protection & conservation bill in a decade
  9. Save our Seas Act
  10. Allowed drug imports from Canada
  11. Required all healthcare providers to disclose the cost of their services
  12. Required hospitals to post their standard charges
  13. Year-over-year declines in drug prices
  14. White House VA Hotline to help veterans
  15. VA employees held accountable for poor performance, 4000 removed
  16. Joint plan to provide veterans access to mental health treatment
  17. Federal employees/military pay increase by 3.1%, the largest in 10 years
  18. 12 weeks of paid parental leave for millions of federal workers.
  19. HIV prevention drugs for free to 200,000 uninsured patients
  20. Small businesses allowed to group together when buying insurance.
  21. First Step Act, reforms that make our justice system fairer
  22. Rehabilitative programs for inmates
  23. Increased funding for Historically Black Colleges and Universities
  24. Forgave Hurricane Katrina debt that threatened HBCUs.
  25. New single-family home sales up 31.6%
  26. Received the Bipartisan Justice Award at a historically black college
  27. Poverty rate fell to a 17-year low of 11.8%
  28. Poverty rates for African-Americans at all-time low
  29. Five national monuments, 1.3 million acres of wilderness added
  30. Committed $124 Million to rebuild rural water infrastructure
  31. [Prior to coronavirus] Consumer confidence at an all time high
  32. [Prior to coronavirus]  More than 7 million jobs created since election
  33. [Prior to coronavirus]  More Americans employed than ever before
  34. More than 400,000 manufacturing jobs created
  35. Doubled convictions of human traffickers and increased charged by 75%
  36. Dismantled an organization making prostitution-related advertisements
  37. Arrested 1,588 criminals associated with human trafficking
  38. School choice so that no child is trapped in a failing school
  39. Increased funding for school choice by $42 million.
  40. ISIS lost their territory and are largely dismantled
  41. ISIS leader Abu Bakr Al-Baghdadi was killed
  42. More than $1 billion for states each year to fund vocational programs
  43. Expanded apprenticeship opportunities for students and workers
  44. Prohibited the U.S. government from discriminating against Christians
  45. Withheld money from college campuses deemed to be anti-Semitic
  46. Halted tax money going to organizations that fund or perform abortions
  47. Sanctioned the socialists in Venezuela who have killed their citizens
  48. New trade agreement with South Korea
  49. European Union to increase U.S. energy exports to Europe
  50. Withdrew the U.S. from the job killing TPP deal
  51. $250 billion in new trade and investment deals in China
  52. $12 billion in aid for farmers
  53. Over a dozen US hostages freed
  54. Made historic official visits to China and North Korea
  55. Billions that will fund the building of a wall at our southern border
  56. Second chance hiring for former inmates
  57. “Ready to Work Initiative” to connect employers with former prisoners
  58. Opportunity Zone Incentives for investment in low-income communities
  59. 8,764 communities across the country designated as Opportunity Zones
  60. End Common Core for public schools.
  61. Established 9/11 Victims Compensation Fund
  62. Prevention programs for Veteran suicide.
  63. Over $1 Trillion in businesses investment returning from overseas
  64. [Prior to coronavirus] Manufacturing jobs growing fastest in 30 years
  65. [Prior to coronavirus] Stock market reached record highs
  66. [Prior to coronavirus] Household income hit highest level ever recorded
  67. [Prior to coronavirus] African-American unemployment at all time low
  68. [Prior to coronavirus] Hispanic-American unemployment at all time low
  69. [Prior to coronavirus] Asian-American unemployment at all time low
  70. [Prior to coronavirus] Women’s unemployment rate at 65-year low
  71. [Prior to coronavirus] Youth unemployment at 50-year low
  72. [Prior to coronavirus] Lowest overall unemployment rate ever recorded
  73. Trained more than 4 million Americans in skilled jobs
  74. Record number of regulations eliminated that hurt small businesses
  75. Welfare reform requiring able-bodied adults with no children to work
  76. More affordable generic drugs than ever before
  77. Reformed Medicare program to stop hospitals from overcharging
  78. Right-To-Try allows terminally ill patients to try experimental treatment
  79. $6 billion in new funding to fight the opioid epidemic
  80. VA Choice Act and VA Accountability Act
  81. U.S. oil production reached all-time high
  82. U.S. now a net natural gas exporter for the first time since 1957
  83. NATO allies increased their defense spending
  84. Withdrew the United States from the job-killing Paris Climate Accord
  85. Circuit court judges confirmed faster than any other new administration
  86. Supreme Court Justices Neil Gorsuch and Brett Kavanaugh confirmed
  87. Moved U.S. Embassy in Israel to Jerusalem
  88. New trade deal with Mexico & Canada
  89. Breakthrough agreement with the E.U. to increase U.S. exports.
  90. Imposed tariffs on China
  91. Improved the National Suicide Hotline.
  92. Most comprehensive childhood cancer legislation ever
  93. The Tax Cuts and Jobs Act
  94. $2.4 billion funding increase for the Child Care and Development Fund
  95. The Child and Dependent Care Tax Credit (CDCTC)
  96. Autism Collaboration, Accountability, Research, Education & Support Act
  97. Anti-robocall law
  98. US stock market hit all-time record highs
  99. Deployed National Guard to dispel deadly domestic riots
  100. Negotiated first Arab country pact with Israel in 25 years (UAE)

(Trump did all of this while fighting constant flagrant abuse from Democrats, impeachment charges, biased news reporting, and a pandemic).

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5

Dear Voter, It’s For Your Children and Grandchildren

Election for children and grandchildren

Elections are always overly focused on candidates and issues. But the consequences of elections have little to do with candidates and issues. Elections have everything to do with the direction of our nation and the shaping of our culture. Too often, we vote on today’s situations while disregarding the tomorrow our vote will create.

In this year’s presidential election, the vast majority of voters seem to be determined to vote based on their opinion of President Trump. Relatively few are really pumped about Biden, but many will vote for him just to get rid of Trump. Their vote is a referendum on Trump’s unpleasant personality, Covid-19 frustrations, and the current state of the economy. How tragic it is that so many voters will disregard the America that a Biden presidency will create for our children and grandchildren.

Regardless of one’s personal assessment of Trump, no one can deny that his pre-pandemic America was on a rocket launch trajectory. The booming economy was breaking all records, patriotism was returning, allies were stepping up to Trump’s demands for fairness, enemies were making concessions to his defense posturing, the nation was regaining its prominence, Constitutional freedoms were being reclaimed. Law and order were respected. In just three years, we had reconstructed a future for our children and grandchildren that would be even better than what we had enjoyed.

Regardless of one’s personal assessment of Biden, no one can deny that his post-pandemic America would be on a rocket reentry trajectory. The economy would weaken severely under Biden’s over-regulation of business, higher taxes, and the “Green New Deal.” His foreign policy would return to propping up wealthy allies and kowtowing to our enemies. Our military would be hamstrung again, and attacks on Constitutional freedoms would resurface. Law and order would be degraded.

The only checks to the radical socialist movement sweeping our nation have been President Trump and conservatives in Congress. If these checks were removed, we would be setting the table for a crippling culture inherited by our children and grandchildren. At an alarming rate, we are moving away from the traditional quality of life, growth opportunities, and freedoms we all have taken for granted. The exponential rate of movement toward Socialism in a four-year term led by Biden and the liberal Democrats would be devastating and probably irreversible. Is that really the America we want our children and grandchildren to credit us for?

Please take just a moment right now to imagine America as you would want it for your children and grandchildren. Then decide which candidates for the White House, the Senate, and the House of Representatives will lead America in that direction. Vote unselfishly for those candidates. Give little or no consideration for personalities or the current state of affairs which will ultimately be of little importance.

I will vote for an America even better than the America I enjoyed–for my children and grandchildren.

Please share this post with those you know who are struggling with this decision.

0

Who Is Vladimir Putin Really?

If we put a face on the greatest threat to America today, it has to be the face of Vladimir Putin, president of Russia. He has led a bipolar life. A man of humble beginnings who rose to prominence in the government of the homeland he loves, he is also a maniacal and ruthless leader with scant moral character. Every American needs to know this man and watch carefully the relationships between both countries and both presidents. Here are some facts to consider.

There are more immediate threats to America such as North Korea and radical Islam, but Russia remains the only threat that can virtually annihilate us. It is the only nation with a nuclear arsenal that could total destroy our densest population centers and has shown the capability and willingness to wreck our internet. The country is also assessed to be capable of an electromagnetic pulse (EMP) attack that could destroy our electrical power grids. Only one man in the world could make any of this happen with a nod of his head.

Vladimir Putin was born in 1952 in Leningrad, Russia, to parents of very modest means. He was a troubled child in primary school but began to take his studies and behavior more seriously in high school. He seemed to have developed a personal vision as a teen for doing something great to advance his country. In 1975, he graduated from Leningrad State University with a law degree. He became infatuated with the field of intelligence and in the late 1970’s enrolled in the KGB school in the capital city of Moscow. The English translation for KGB is “Committee for State Security,” which is loosely the counterpart for the American CIA. He advanced quickly to a high level position with the Soviet Union intelligence service.

In 1983, he married Lyudmila Shkrebneva, a flight attendant, just before departing to his first KGB field position in East Germany. They had two daughters, Maria and Katerina. The couple divorced in 2013. Putin is officially single, but a long-standing rumor has it he is secretly married to Olympic gold medal gymnast Alina Kabaeva. In East Germany, he was promoted to lieutenant colonel and assigned as senior assistant to the head of the department. In 1991, frustrated by the fall of the Soviet Union, he crossed over to politics becoming the deputy chairman of city government in St. Petersburg. He realized his future had to be within Russia’s first ever attempt at a fledgling democracy. From there, he move swiftly up the political ladder to Moscow and was appointed in 1999 as Director of the Federal Security Service and Secretary of the Security Council of the Russian Federation.

Within a year, Russian President Boris Yeltsin appointed him as prime minister of Russia. Within a few months, Yeltsin stepped down and Putin became president never having been elected under the relatively new Russian pseudo-democracy. He was later overwhelmingly elected as president in 2000 and reelected in 2004, both by wide margins. Due to term limits prohibiting a third term for Putin, Dmitry Medvedev was elected president in 2008 and immediately appointed Putin as his Prime Minister. Many in Russia considered Medvedev to be a figure head with Putin still running the government. Putin ran again for president in 2012 for a newly legislated six year term. He won handily again in 2018 and will be president until at least 2024.

Western analysts no longer consider Russia a real democracy due to political corruption that gives Putin a land-slide victory every election. Elections have become more of an exercise of fear than of freedom. He is known to torture his opposition or even assassinate them. The recent nerve agent poisoning of a former Russian spy and his daughter living in England was the latest in a long list of those who ran afoul of the Kremlin and suffered or died under suspicious circumstances.

Putin seems to be pursuing a foreign policy of slow, long-term of geographical expansion much like the old Soviet Union of his earlier years. In 2014, after several military incursions into Ukraine, Russian soldiers in unmarked uniforms invaded the Ukraine’s territory of Crimea and claimed it for Russia. Since then, Ukraine has had many armed conflicts with Russian backed separatist forces in their country. Then in 2015, Russian forces moved into Syria to help prop up the Syrian leader Bashar al-Assad. The Russian forces are also assisting the Iranian forces there.

So, here we have a man cultured in the dictatorial and empire-building Soviet Union who has risen to power through corrupt elections and thuggery, but earnestly wants to be legitimized and respected on the world scene. President Trump’s approach to try to form a friendly relationship with Putin is a very long shot. The President’s personal policy in dealing with our enemy heads of state seems to be to open more lines of communication with them while keeping them at arms length (ala Kim Jong- un). I’m for giving him a chance as long as he keeps the pressure on with continued serious sanctions and requirements of concessions. Putin must also feel the wrath of America if he encroaches on another country again. Being a buddy with a despot can backfire if not handled very carefully with eyes wide open. Go for it, Mr. President. But, America is watching closely.

 

 

 

 

0

Hey World, It’s Not Business As Usual for America Anymore!

 

After decades of other nations taking unfair advantage of America’s generosity, President Trump is reducing the outflow of our tax dollars to other countries and holding them accountable for more of their own security and prosperity. It isn’t setting well with nations which have been enriching themselves on our resources for generations. This will be a painful process for America and the rest of the world, but the adjustment is crucial for the future of all nations. Here is what it will require.

Most of the current inequity began with America’s compassion and goodwill demonstrated in the post-WWII reconstruction of Europe and Japan. Our subsequent prosperity during the 50’s and 60’s placed us head and shoulders above the rest of the world in economic and military power. Our Judeo-Christian values led us to share our blessings through foreign aid, the World Bank, imports, defense alliances, liberal immigration, response to disasters, etc. By and large, the rest of the world’s governments became dependent on us to supplement their subsistence. Allies depend on our military to supplement theirs. The oppressed depend on us to take them in. Foreign businesses expect to export to us without barriers, but don’t reciprocate. Even our enemies assume we will feed their economy while they threaten us. A world game-changing adjustment is well overdue.

Of course, America must always be America, the nation that shares its incredible blessings with those less fortunate both domestically and throughout the world. We have a moral responsibility to heed the words of Jesus, “Everyone to whom much was given, of him much will be required.” But, when the giving gets way out of balance and enables others to neglect their own responsibility, such enabling is wrong and the giver is to blame.

The controversial NATO Summit just concluded exemplified the new order of international relationships with America. Since 1949, western European nations have trusted in the U.S. to protect them from the former Soviet Union and now Russia. Although all the nations have military forces, the U.S. contributes well over half of the investment of those forces. The chart above shows that, of the 29 NATO nations, ours funds over 70% of the total military capability. Defense spending as a percentage of GDP is probably a fair comparison of skin in the game. Even at that, we spend 3.6% of our GDP on defense–much more than any other member country. All NATO countries agreed at the 2014 NATO Summit to spend at least 2% of their GDP on their military annually. Only four other countries are doing that. Yet the Russian threat is in their back yard and an ocean away from America.

Some European governments argue that all of their defense spending is in support of the NATO region while much of U.S. spending funds forces obligated to the Pacific and other areas of the world. That argument doesn’t consider the fact that, if Europe were attacked, almost all of our forces would be immediately deployed to the European theater.

And, there are other ways America is moving from business as usual to fairness and equity in international relations. For years, foreign governments have placed excessive tariff charges on imported U.S. products to keep their domestic businesses competitive. Then, their businesses enjoy exporting products to the U.S. with little or no tariff charges by us. That is a big reason we have such a trade deficit with other countries. We import much more than we export due to unfair trade barriers of our trading partners. President Trump’s tariff increases may cause some discomfort to our own citizens in the form of higher prices. Trade wars may make certain items scarce. But, it is a necessary temporary pain in order to ultimately create a level playing field for international trade. Free trade must be fair trade.

We are also seeing adjustments to the long-running open borders that have allowed almost anyone and everyone to enter our country, often illegally. We have long-established legal processes for reasonable immigration and asylum. But, millions of illegal immigrants have entered our land and are siphoning our resources. Business as usual trespassing on America is starting to be denied although not without major opposition from the liberal faction among us.

The U.S. GDP is greater than that of all European countries combined and almost twice that of the second highest nation, China. The U.S. military comprises over a third of the entire world’s fighting forces. There is almost no possibility of losing our world leader status anytime soon. Other nations will continue to look to America for help and direction for the foreseeable future, and we are morally obligated to maintain that role. However, the time has come for a global reshuffling of commitments and an environment of fairness among the nations. Mainstream media will decry it as betraying our friends, and protests will abound both here and abroad. But, just sit back and watch an essential and healthy cultural shift take shape. “Make America Great Again” is not a motto of arrogance; it is a reset toward fairness. It’s not Trump’s isolationist doctrine; it’s Trump’s fairness doctrine.

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0

The US/NK Summit: What You Must Know

America and the rest of the world are about to witness the most historically significant meeting since the 1986 Reagan-Gorbachev talks. The Singapore Summit will consume all media outlets and has the potential of beginning a peaceful resolution to a volatile international crisis. It could also be a possible first step to the reunification of two nations, a la Germany, 1987. To understand what is really at stake, you must understand the following.

Before 1910, Korea was a peaceful and beautiful farming country ruled by a succession of kings. During the Russia-Japan war, Japan took control of Korea for the next 35 years. Japanese culture and religion are still evident in north and south Korea, a hold-over from that period. After World War II, allies US and Russia agreed that each would control half of Korea much like the post-war agreements regarding other countries of the world. Korea was divided with Russia taking the north and the US taking the south. Russia installed a communist regime in the north under Chairman Kim Tu Bong, later ceding influence to China. The US installed a capitalist democracy in the south under Kim Koo. In 1948, Kim Il Sung became the dictator of North Korea until his death in 1994 when his son, Kim Jong Il, became head of state.

In 1950, North Korea invaded South Korea with the objective of reunification of the two countries under communism. The United Nations sent military forces from several nations into South Korea under the command of General Douglas MacArthur. The UN forces, predominantly US, ran the North Koreans back into their country and continued to push them all the way to their border with China. China, fearing reunification of the Koreas as a democracy, entered the fray causing heavy casualties on the UN forces which retreated back to their borders. In 1953, an armistice, or cease fire, was signed between the north and the south. This agreement established a demilitarized zone (DMZ) at the 38th parallel with a buffer zone containing only a few soldiers from both countries to ensure border security. However, an end to the war was never declared–there was never a surrender of either side.

North Korea flourished under communism for several years until they became consumed with military power pouring their economy into weapons and combatants. At the same time, South Korea was coming of age in its democracy with international trade sky-rocketing its economy. North Korea shocked the world in 2006 when it tested a nuclear bomb. The UN immediately enacted a resolution prohibiting further tests by the Kim Jong Il regime. A second test came in 2009. In December, 2011, Kim Jong Il died, and his son, Kim Jong Un, succeeded him. Within a few months, the new dictator test-launched a technically advanced missile followed by a third bomb test in February, 2013. Since then, there have been three more nuclear bomb tests and 26 ballistic missile tests. The last missile test was an intercontinental missile which demonstrated the capability to reach anywhere in the US.

Kim Jong Un initiated the songun philosophy of defense, meaning “army first,” with the motto, “everyone feeds the army.” Over the last five years, he has radically and exponentially advanced the political and military pursuits of his father and grandfather. Obviously, he is determined to secure his dictatorship by military power, mostly in the form of nuclear ballistic missile capability. This effort comes at the expense of nation-wide poverty of his people and decimation of his economy. He has not shown a desire for quality of life for North Koreans, but rather a desire for global extortion and self aggrandizement. This type of rogue leader in possession of nuclear bombs also paves the way for terrorists to obtain tactical nuclear weapons.

It is going to be an extremely difficult negotiation. Convincing a ruthless dictator to give up what he sees as central to his survival and world view seems virtually impossible. Based on past promise reneging by him and his predecessors, we should be very skeptical about what may appear to be an accommodating spirit. The summit also has critical implications regarding our relationship with China, Russia, Japan, and South Korea. But, the bottom line is that the world must stop North Korea’s development of nuclear weapons. The question is how–by diplomacy or by military action. This summit will probably determine which will have to be used. Pray for godly wisdom for our president and his staff.

 

 

2

Trump’s Tariffs: Good or Bad for America?

As a teacher of college economics, I am generally a free trade advocate. Tariffs are usually hindrances to free trade. However, the complex issues of a huge international trade deficit and a sharp decline in manufacturing in America warrant consideration of increasing tariffs on some of our most critical imports. Our future economic health requires leveling the playing field between us and our international trading partners.

The subject of international economics is, of course, far too intricate to accommodate in a short blog post. But, we need to understand a few fundamentals in order to make sense of what is at stake in the current controversial tariff decision by the president. A capitalist free market is without question the best overall trade system known to man. In the best of all worlds, open competition driven by profit incentive and unconstrained by government yields the highest quality of life for everyone. Unfortunately, this utopian economic system is always subject to corruption by the selfish, power-seeking participants.

America’s domestic free market is protected from bad players by various anti-trust laws, monopoly restrictions, and price stabilization controls. Buyers and sellers are virtually free to deal according to supply and demand, but within certain parameters that ensure fairness. This free, but guarded, economy has made America the richest nation in the world. Although a few international trade agreements attempt to provide similar protections for world markets, the restraints are minimum. International trade is a different environment occasionally requiring government intervention.

Two realities place America at a disadvantage in trading with other countries. First, our economic advantage has become our economic disadvantage. We have attained a quality of life that requires a level of individual wealth not enjoyed by most other countries. Therefore, Americans are not willing to produce at the lower income levels accepted by foreign workers. That means other countries can produce most goods and services at lower prices than we can. Second, to keep the price gap wide between American and foreign products, other countries often add burdensome tariff taxes or place limiting quotas on products we export to them. Conversely, the U.S. rarely places tariffs or quotas on imports from those countries. These practices make American products more expensive in foreign countries, while foreign products enter our country at prices far less than like products made in America. That results in high demand for foreign products in America, and low demand for American products in other countries.

This situation has caused a serious trade deficit in America in the amount we export versus the amount we import. In 2017, we imported $2.895 trillion in goods and services while exporting only $2.329 trillion. That is a deficit of $566 billion, a serious outflow of America’s wealth (20% gap) to other nations. To sustain a healthy economy, the export-import ratio should be zero–exports equal to imports–or even a net-export surplus. The dilemma is how to level the playing field without hurting our own citizens.

American consumers benefit greatly from lower prices of foreign goods and services due to lower labor costs of the other countries. At the same time, our corporations and employees suffer in sales decreases, job losses, and pay reductions due to export restrictions and lower prices on imports. President Trumps tariff proposals on steel and aluminum are a step toward resolving this dilemma, although there are valid downsides.

Such tariffs would allow American steel and aluminum producers to compete in price with foreign producers, since the higher taxed foreign products would cost more in our country. Of course, higher priced raw materials will drive up the prices of steel- and aluminum-based products for all American consumers. We Americans will have to feel some pain in order to meet our national economic objectives. The reductions in sales of foreign products to America should provide incentive for other countries to lower or withdraw their tariffs on American products as a move toward a more balanced market. Other countries need to get the message that flooding the American market with lower priced imports is no longer an option unless they allow our exports to enter their market without tariff.

Some lawmakers decry the tariffs as provoking an international trade war with other countries banning American products and America banning theirs. We may see some of that, but the risk is worth the reward of ultimately balancing our imports and exports. The bottom line is we can’t continue our increasingly negative trade balance that is so detrimental to our economy.

I hope the Chicken Little reaction from the left and even some conservatives will cease, and we will all give the president’s plan a chance. Let him have the bargaining tools he needs to make America great again.

I encourage your feedback.

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