The Wealth Creation — Tax & Debt Redistribution Continuum

>>PDF copy

>>Print copy

Give me that old fashioned (like last year), change we can believe in. Last Tuesday’s primary elections signaled, throw out all the bums, and let us choose the less — most desirable between who is left. The grizzly bears moved back to a very realistic position on Wall Street. The Senate finally passed a financial reform bill which will help the 2 Big 2 Fail, sort of, not change a whole lot and provide bennies for some others to continue to over leverage our worthless money supply. On Sunday we heard from the Feds, that if BP continues to miss the deadlines on stopping the Gulf oil spill that they are going to take over. That will surely help, I’m sure?

Through it all Americans continue to learn about, and demand a redux of our founding constitutional principles, but all the pundits, spinners, commentators, and politicians think this will help them, when in reality the issue really is much more complex than can be articulated in a brief media story. Furthermore even if they could, their spin is so dumbed down and politically correct, that it could be shown that they would be quickly eliminated from the TV show, and then must announce that they are not smarter than a fifth grader.

So in the finest efforts of the Texas Board of Education’s textbook curriculum revisions, let us develop some context of what is really happening.

Way back in Colonial days, the people of the revolutionary era were very religious and in the process of writing a formal constitution they did a miraculous job of creating a secular government based on Absolute Christian religious principles.

Today we live in a very secular world and what we are trying to do is to take secular principles and redux them to Absolutes that will provide security in a rapidly changing world. In simple terms, back then most were committed to their religion, and a very few were secular. Now most are very secular, and a very few are committed to religion.

In truly secular terms, the American Founders looked outside themselves for governance solutions, which they believed rested in God alone. So pretty much when asked what was the Christian gospel, they would respond something like:

“Jesus Christ was the son of God, who came to the earth to die in a sacrificial covenant for the sins of mankind, which he accomplished by being crucified on a cross seventeen hundred years ago. He was raised from the dead three days later to show that this gift of God’s grace is the source of our justification before God’s holiness.

“When in our Declaration of Independence when we affirmed Natural Law, Nature’s God, and Inalienable Rights, what we were really doing was taking our specific revelation of God from the Bible, and applying it to what is theologically called the general revelation of God in nature and the common grace God bestows to all of humanity.

And today’s dumbed down sheep of all religious faiths, and lack of thereof religion say, “Huh?”

Today, those who practice religion and those who don’t, rely not on external Absolutes, but rather a truth that lies within. If I feel good about it, it must be true, whether that is a Jesus moment, or just getting sick and tired of being sick and tired. We have a difficult time, no impossible problem, that if we don’t experience something for ourselves, and hence provide a moral application, it really cannot be real.

So for the last century or so, we have been rewriting history in terms that we can understand from our vain emotional worldview, which is at best Deist, if not atheistic. From this we learn that life is just evolutionary progress, where we, through our individual and collective wills, can compress millions and billions of years of evolutionary uniformitarian times, with appropriate quantum leaps of informational energetics, into changes that make us better, and richer, and morally superior, essentially by being lazy slobs. We have the best of it all, by not really trying, physically, intellectually, or emotionally.

What happens if we are truly living a lie? What if there are complex Absolute Natural Laws beyond just physical laws such as gravity and thermodynamics? What if Nature’s God gave us a whole bunch of Inalienable Rights for us to discover, not through evolutionary processes, but rather Common Grace illumination?

Late last week I wrote and email to some potential investors about our PREFER Ltd. precious metals mining and refining adventure. In that email I pointed out that what we consider money today is really electronic bits and bytes of information stored on a universe of computers all over the world and this contains no historic monetary value. Some of that binary code is from time to time in various places converted into historic mediums of exchange such as into paper and coins, some to the realities of consumer trade, some to so called investments, and some to promote our frivolous vanity.

However in our current world of human irresponsibility, an incalculable amount of the world’s money is invested in stupendously leveraged speculative scams, then these schemes are insured with leveraged derivatives, and back stopped by the world’s national central banks.

Money, money, everywhere, but none of it is actually creating any new wealth. Furthermore what wealth that still exists in the world is taxed or borrowed against, to run bureaucratic government regulatory programs and to keep the non elite from starving to death through fraudulent redistribution schemes.

Once the email was on the way, I continued to think about this relationship between wealth and money, and the more I thought about it, the more I am convinced that the real problem in the United States and all the national governments around the world, in this universe of economic uncertainty, is the belief that money, as it exists today, is truly wealth. But is that conclusion really an Absolute, or our warm fuzzy relativistic emotional thinking?

What would happen if we understand wealth creation as a God given natural law, one of those inalienable rights of America’s Founders? That really does make global finance a global Ponzi scheme, but more importantly eventually money, money, money, making the world go round, eventually becomes a cancer, and the whole global economic system doesn’t just collapse, it dies. Hunting and gathering is a difficult way to make a living. Five thousand years of human development has disappeared in a relative heartbeat.

In a legal sense, the opportunity to create wealth should be covered under the Natural Law compendium of the pursuit of happiness, and furthermore it could also be construed in the legal sense as a “fundamental” right as well. While such legal profundities are beyond this discussion, could all these monetary manipulations we see playing out on Wall Street be considered infringements upon protected wealth producing human enterprise rights? It might also, as we will see shortly, have an effect upon the legality of Federal government deficit spending, especially in the context that most states do not allow this behavior of governance.

When we look at wealth creation, we must find it in the context of the Bible as the specific revelation of God, which served as the basis for the secular creation of the United States. In the Biblical sense the Apostle Paul codifies three specific imperative empirical laws (1 Corinthians 13) that require have natural law applications. Those three are “Faith, Hope, and Love (Charity in the literal and eighteen century sense).

Faith is the requirement to risk everything to create wealth essentially ex nihilo, essentially out of nothing, Hoping that it will succeed, and if not Charity will be needed to continue forward or to start over. This must be contrasted with our world’s monetary manipulation that does nothing but continually rearrange the deck chairs on a sinking Titanic.

You can borrow money to create wealth, but that borrowed money, must come from present wealth. For example you can borrow against your home equity to start a business, and if successful that equity seed, will be repaid, but if not you could lose everything.

Bringing the Faith energetics along with the wealth producing Information they become a reality of a seed of human enterprise. All human achievements are really the fruit of the germination of that seed and the faithful husbandry to allow the seedling to grow into a healthy plant, to keep with our agricultural metaphor. Again, according to Paul, the most productive fruit of wealth is the Charity to help others.

Prudent borrowing of, or use of debt can be a method of growth of that original wealth, but they cannot create the wealth seed. Furthermore excesses in liquidity shift from health to disease, and with the use of excess risky leverage, you move beyond the protection of natural laws into presumption. Laissez Faire presumption, essentially beyond the Invisible Hand of Adam Smith led to the busting speculative bubble that resulted in the Great Recession. To many we have just kicked the ball down the road, not solved the underlying problem. That being the case, the severity of the remedy becomes more complex and difficult. Taxes and debt can redistribute wealth, but nothing we are currently doing in the United States addresses this Natural Law reality that wealth is disappearing and debt and taxes continue to increase.

Now in evangelical Christianity, there as existed for a long time the concept of “Seed Faith.” The origin of that probably goes back to at least the century we discussed at the beginning of this article, maybe the Second Great Awakening, or maybe even to the birth of revivalism before the American Revolution. However if you notice in true natural law wealth creation must be a commitment of the individual to the result. Since the investment in “Brother Love’s Traveling Salvation Show” is by its nature passive, all it can really produce is emotional rewards. Most of the time providing Charity to Brother Love, who thinks he deserves it, not because of his faith, but because of his personal piety.

Both God’s specific revelations in the Bible and the general revelation in nature utilize the concepts of continuums to express divergent views or realities. Such examples as desert and rain forest, good and evil, faith and fear, are all examples of continuums. Many times they can be combined such as in the seasons, winter cold — summer hot; spring rebirth — fall death.

For the last century, in man’s governance endeavors we have seen the ascendency of the global collective in contrast with the independent individual. In the last half century we have seen the rise of debt at the expense of taxes to pay for lifestyles beyond the ability of society to create wealth, because we assumed that wealth and money were really one. What we failed to understand was that both are redistribution schemes, which really ignore the reality that wealth creation is a natural, different, but similar to the sun rising every morning. Taxes and debt essentially play with the distribution of money, and for too long we thought we could make everything work because we believed in the power of our own enlightenment.

The only way that we can alter the future is to focus on the natural law of wealth creation, begin to stop putting all our wealth in collective financial dinosaurs, and redirect that liquidity to individual entrepreneurs with the faith, hope and charity to change the world. It is not rocket science, but it seems to be currently beyond the enlightened collective elite, that have failed to lead, in a world in which they claim to have all the answers.