President Trump is calling for a 135% increase on a tax we all pay regularly…
To borrow the bankruptcy quote, here’s how we will see the economic collapse: Slowly then all at once.
You see, every taxing authority, from the tiniest to the largest, from the most local to the federal, is always demanding more.
If it weren’t so painful on the pocketbook it would be funny.
But it is not funny. Taxes basically go one way – up.
Sure, we just had an awesome tax cut, right?
Well, that depends. If everybody is laden with debt, or if price inflation is rising as we just learned yesterday even in the government’s doctored numbers, or if bracket creep sets in and those who thought they were in a lower tax bracket suddenly find themselves in a higher one, well, we can kiss those tax cuts goodbye.
But there’s one thing I forgot to mention: What good are the income tax cuts if the government just raises taxes somewhere else?
That certainly seems to be the case with the trial balloon coming from the strange bedfellows of the White House and democrats in the congress.
You see, President Trump is floating the trial balloon of raising taxes $.25 on the national gas tax.
On gasoline, which is currently taxed by the feds at 18.4 cents per gallon, that equals a larger than 135% increase in just on tax we all pay regularly. Adding insult to injury, this is at a time when the price of oil has carved out a huge bottom after the collapse and is now starting to work its way back up.
A $.25 gas tax hike would have barely been felt in spring of 2016 when the price of oil was bottoming at $26 per barrel, but now, as gas prices are creeping higher, that would be a shock to the system that’s for sure. Imagine gas prices rise by $.50 on their own by this summer, and then we also have a $.25 tax tax hike. For somebody who uses 30 gallons of gasoline per week, we’re talking about an increase in $22.50 extra that needs to be shelled out just to keep the tank full. So much for the income tax cuts for those at the bottom of the barrel.
Here’s more on the proposal from The Washington Post:
President Trump tried Wednesday to persuade his fellow Republicans to raise the gas tax. In a closed-door meeting on infrastructure with members of both parties, Trump pitched the idea of a 25-cent increase in the gas tax, which hasn’t been raised since 1993. There’s a growing rift among Republicans about whether it’s worth considering a tax hike to fund much-needed upgrades to America’s roads and bridges.
“To my surprise, President Trump, today in our meeting, offered his support for raising the gas and diesel tax by 25 cents a gallon and dedicating that money to improve our roads, highways and bridges,” said Sen. Thomas R. Carper (D-Del.), who attended the meeting. Carper supports the increase and said “Trump came back to the idea of a 25-cent increase several times throughout the meeting.” The president “even offered to help provide the leadership necessary so that we can do something that has proven difficult in the past,” Carper said.
Here’s why it matters, and it has to do with an old cliche: You can’t squeeze blood from a turnip.
You see, Americans only have so many dollars. We can only pay so much in tax. We pay somewhere to live, we eat, buy clothes, pay for medical care, and after all of those things are taken care of, we pay taxes. But what happens when everybody is slowly but surely asking for more with this tax here, or that tax there?
To use another cliche: That’s a dog that don’t hunt.
It can’t be done.
At one point, there will be not one leftover penny to extract from the populace, and, just like the CCCP collapsed under its own weight in the 1990s, that is my estimation of what is going to happen here.
China and Russia don’t need to go to war with us to show the world who the new boss is. They just need to wait for us to collapse under our own weight.
And with the possibility of a 135% increase to the Federal Gas Tax, slowly but surely, we get closer and closer to the tipping point.
– Half Dollar
Be sure to check the other articles in the Hyperinflation Watch, where I attempt to document, in real time, the coming hyperinflation.