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To: Turbopilot

My guess is that if problems do occur we'd stand a better chance of obtaining certain goods with gold/silver vs FRN's or stock certificates. What's intriguing here is if you're analysis is correct do we really own anything? Something that's always bothered me is how someone can lose a paid-off house by not paying property taxes........sure those taxes may represent an obligation for which a lien could place against but what gives a gov't taxing unit the right to seize property? Do they have a legitimate claim or are they just taking over something they already own because the peons didn't pay their tribute?


43 posted on 11/29/2005 3:46:53 PM PST by american spirit (Can you handle the truth? - www.rbnlive.com ( 4-6 CST M-F)) / click "listen live")
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To: american spirit

Maybe in certain dire situations gold would be a more useful measure of trade than reserve notes, but if things got that bad I'd guess we'd revert to a pure barter system. I would be surprised if many people would be willing to trade necessities of life for precious metals, if those necessities weren't widely available anyway.

As far as owning personal or real property, I think you may be combining the separate issues of property tax liens and government debt. While I do think the federal debt is too high, it remains at a relatively stable 70% or so of GDP, meaning the country produces more value every year than it owes. This debt/GDP ratio is neither historically high nor is it high in comparison with other first-world industrialized economies. Additionally, a significant fraction of the debt is money the government owns to itself through such vehicles as the Social Security "trust fund"; if the SS program were legislated out of existence tomorrow, trillions of dollars of federal debt would cease to exist. Also, as another poster mentioned, the government does not account for its assets in the same way a private company would. Federal land holdings alone are probably worth more than the outstanding federal debt, if they were to be sold on the open market; the government also owns trillions of dollars of military hardware, commercial space, aircraft, vehicles, etc. Finally, while the government debt is "owned" by the people, creditors (T-bill and other federal security holders) cannot collect that debt directly from the people. The government must raise taxes to pay its debt, and as such it is restricted by the realities of politics and the unpopularity of taxation. So in that sense, the government's debt is both smaller than the nation's economy and cannot be taken directly out of that economy by confiscating private property.

Property taxes are a separate issue. First, it's important to remember that those taxes are levied by states and municipalities, not the federal government, so they are collected and enforced by a whole different sovereign entity (actually, 50 of them). They, along with eminent domain, can reasonably be said to prevent true ownership of real property (although they are generally no longer levied on personal property, as they used to be). However, it is important to remember that there have always been some limits on private property rights; one cannot, for example, use one's property illegally. Also, ownership of property frequently is limited by public easements, separate ownership of mineral or water rights, zoning laws, public airspace ownership, etc. Not every state or city assesses property taxes. But I do disagree with the idea of taxing value rather than profit; in my opinion a more fair method of property taxation would be a capital gains tax on any increase in value on real property upon its sale, with no taxes assessed unless or until that property is sold. That method would bring property taxation in line with taxation of other tradable securities and commodities. But in general I don't think the government really "owns" private property; it assesses taxes and files liens when those taxes go unpaid. The IRS can file liens against property for nonpayment of income taxes, too; it's just that with property tax there is a direct connection between the tax and the lien, so it appears perhaps more sinister than it was meant to be.


49 posted on 11/29/2005 4:42:55 PM PST by Turbopilot (Nothing in the above post is or should be construed as legal research, analysis, or advice.)
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