The worst thing you can do when people are broke is raise taxes. Using the force of government to extract money from people only works during affluent times - like the recent decade of fraud and deception.
Another important economic principle to understand is that increasing costs (inflation) is the cruelest form of tax. Those who can least afford to pay are hurt the most. PLEASE - memorize these two lines: As prices fall for goods/services (deflation) your dollars are worth more. As prices rise for goods/services (inflation) your dollars are worth less. EXAMPLE: You might think you are paying 6% interest on your mortgage. During a period of deflation (falling prices) you are actually paying a much higher interest rate - because you are using dollars to pay off debt that are worth more than they were when you incurred the debt. To make big money, you must acquire assets AND debt toward the beginning of an inflationary period (rising prices.) Not only do your assets increase in value, but you are paying debt off with dollars that are only worth 50 cents each (as an example) - so your effective interest rate is actually a lot lower. This post was prompted by Michael Hohmann's insightful post: "Nationally, economists debate the merits/probabilities of lower inflation trends and deflation in months ahead; and speak of a correction in the housing market (a bubble?), lower rents to follow...? My advice to local budgeteers............Reduce overhead. Liquidate real assets competitively to reduce the local burden on Mpls. property taxpayers." Vicky Heller Cedar-Riverside and North Oaks _______________________________________ Minneapolis Issues Forum - A City-focused Civic Discussion - Mn E-Democracy Post messages to: mailto:[EMAIL PROTECTED] Subscribe, Unsubscribe, Digest, and more: http://e-democracy.org/mpls
