Monday, May 6, 2013

This is a letter I have recently sent to Representative Paul Ryan of Wisconsin's 1st Congressional District:
May 6, 2013

Representative Paul Ryan
1233 Longworth HOB
Washington, D.C. 20515
Phone: (202) 225-3031 
Fax: (202) 225-3393


I would like you to NOT vote for any Internet sales tax such as H.R.684. Smaller retailers will be hurt due to the complex tax codes and numerous jurisdictions (around 10,000). This will not create a more level playing field, but attack the small businesses we need for job creation. $1 million in sales is not all that much. With competitive pricing and shipping costs, gross profits may be under $250,000 and net profits could be much less. Clearly with drop shipping such a company could be a one person operation that will need to manage thousands of tax forms or pay expensive fees to others to do it for them.

The states cannot come together to agree what is food for goodness sake. Businesses will need to have multiple different tax categories for virtually everything they sell. For example, a Snickers bar is a sugary confection and is obviously candy, right? Maybe not for some states will note the peanuts in it and call it a food item. So, the simple definition of the item is not simple at all. Plus some states will tax food and others may not.

My experience in Wisconsin alone offers a glimpse of how complex this will be. I have a very small IT consulting business. I can drive in southeast Wisconsin and northeast Illinois which provides me with 5 different taxing jurisdictions. Illinois does not tax labor while Wisconsin does. Sounds simple, but wait! Each of the 4 counties in Wisconsin I have served has a different tax rate. Walworth has only the state sales tax. Kenosha adds in the county sales tax. Racine omits the county tax, but gets hit for the stadium tax. Milwaukee has both the county and stadium taxes. Wow, but not too bad you may say.

Oh but there's more. When I resell software which is prepackaged it is taxable, but if I custom write some code it is not. Then, we have the issue of where the PC resides. If, I replace a hard drive in a person's desktop PC, it is taxable labor. Yet, when I replace it in a PC used to automate a home and that PC would be sold with the home, it is not taxable. It gets more enjoyable still when I have to break out the time I take to back up and restore the data on those hard disks, if for personal use as data services are not taxable in Wisconsin.

I would love to expand into Internet services, but the fear of this type of law makes me reluctant. Extrapolating the complexity to 10,000 jurisdictions is mind boggling. If I was already in that type of business, this bill would be making me take a break from this letter to go vomit. It would be that scary! Small businesses without multi-billion dollar budgets cannot cope with this burden.

If the concept of a sales/use tax is where the item will be used, then I feel this is not fair at all for the brick and mortar stores will not be required to ID all their customers to be sure they actually reside in their state. They get the privilege to “assume” the tax should go to their local tax jurisdiction, but what if a tourist buys a big ticket item to take back home with them? I understand states lose revenue, but if a business is not within its borders, it is a compliance issue with their residents, not that of the business. Businesses will be forced to comply with complex rules, collect taxes, get fined for errors and much more without any representation in those states. It is simply wrong.

Brick and mortar stores have many benefits which online retailers do not have like the ability to provide immediate sales and to have product samples available. Online retailers have the burden of having to charge shipping on top of the price of the product or service. Let's just admit each business model is unique and leave both alone.

I also feel most state governments are spending too much money. Finding additional revenue for them provides incentive for them to continue their foolish behavior.

Just vote NO on Internet sales taxes! They are a burden to small businesses. They are immoral to apply to out of state businesses.


Joseph Kexel
7616 – 33rd Avenue
Kenosha WI 53142

Wednesday, October 31, 2012

Personal Property Rights 101: Your Body

Do you own your life and body? If not, who does? Your neighbor? Your government?

Should you be free to put anything into your body that you wish? I believe you should!

I fully support every person's right to eat bacon, glazed donuts or even a strict vegan diet. I support a person's choice in water, be it bottled, fluoridated, fluoride free or in a BPA-Free reusable container. I will even admit to supporting the individual right of people using mind altering substances like alcohol, cigarettes, coffee, energy drinks and soft drinks. I can go further and support the rights of people using other drugs, even those deemed illegal like marijuana, cocaine, opiates, downers and uppers. Keep in mind that supporting the right to ingest something does not equate to endorsing that behavior.

Notice I said right. A right is not something given to you by government. A right is accepted as your natural or God given state in the world. You have the right to be the sole actor in your own life. You have the right to manage your body in any way you choose.  As long as your outcomes, either positive or negative, are limited to your life and body, everybody else is limited in their authority to change your behavior.

Simply, every human activity is a balance between good and bad outcomes which the individual as 100% vested owner of their life and body are the ultimate decision maker for. Although, I may use my right of speech to educate others to avoid dangerous behavior and poor outcomes, I do not have the authority use physical force to limit the choices available to another individual. A real world example would be that I may persuade you to avoid ingesting a substance, but I do not have any authority to wrestle that double order of bacon from your greasy hands.

There is another level to this issue that must be addressed. If neither you nor I have the authority to rip bacon from our friends hands and no other single person has that power, then how can we grant that authority to another organization such as a government. Government gets its power from the people, yet no person has the right to kill or assault others. Why do we believe that government may justly use the power of violence? Even when the majority chooses to pass a law, how does that make those who reject that law suddenly subject to the force of government to make them comply? I will let you think on that one.

There is another class of substances which people ingest which has created another drug war. However, it is not likely what you imagine. Many people, myself included, use biologically active compounds in order to enhance our physical well being. We use nutritional supplements. The FDA works hard to limit our choices, even to substances which are 100% natural.

Example in point is Vitamin B6. This naturally occurring compound is now close to being illegal for use as a nutritional supplement. Don't worry though. You will be able to buy it by prescription at a very high price. Big Pharma has your back. See this article.

Banning natural occurring products and compounds is an extreme assault on our rights. We are living beings on this planet. As such, we get to use things we find in nature for our own use. We must nip this in the bud or we will see the day when all the best quality foods may be by prescription only. We cannot wait until we discover H2O is suddenly on the banned list. Banning water sounds crazy, I know. However, banning marijuana and B6 is just as crazy and we are already there.

Our neighbors and most certainly our government must never come between nature and our bodies.

Tuesday, September 11, 2012

Keynesian Economics is Simply Wrong

I find the most dividing idea between libertarians and the other ideologies is Keynesian economics. It comes down to whether or not people believe if it is a true representation of what happens within an economy. Does the economic cycle begin with demand and consumption? Does the Keynesian supported government stimulus work? Those are interesting questions and I will offer my views on them here.

To answer the question on the economic cycle, we must look at how the most basic economic transactions occur. Imagine being any animal on Earth and imagine how you will satisfy your most basic needs such as food, water and shelter. I suggest imagining being an animal first, so you do not jump to the wrong conclusions. It is easy to quickly assume so much is true that in reality is not.

Obviously, you will wish to solve the above mentioned problems. Your very nature demands you fulfill those needs or you will perish. So, you just go out and consume, right? No, that would be impossible, unless your water, food and shelter just occurred without any effort on your part. Every creature must create their access to the necessities of life. So, you must forage or hunt for food and then eat it.. You must find a water source and drink from it.  You must discover or build a suitable den and then enter it. You may have had a desire for those things, but you had to work for them first. You had to produce the results needed before you could consume them in order to continue living.

This is the most important point I will make in this whole article. Production occurs before consumption. In the animal model it is easier to see that truth. In the modern world demand seems to lead to consumption and then to production. However, no consumption can ever occur before production, even if is only picking the berry to put in your mouth, that must be done first. Today, when you are hungry you go to the store and buy food. Demand directly leads to consumption, right? No, you bought the food using money which is a representative place holder for the production you have already done. Money is your previous production that you then trade for your needs. You have already produced products and services which you then trade for other products and services. Your consumption came after your production. This is where modern civilization confuses the matter a lot. Money seems to be poorly understood. Few people consider that a week's pay is short term savings of your labors in order to trade for the labors of others. When you add in credit, the ability to buy based on your future earnings, it gets even more confusing.

It is clear, as we have seen in many communist (totalitarian socialist) nations, demand is never the problem. Demand is infinite! Bare shelves are the problem and that is a production problem. The reason Keynes suggests "priming the pump" and government spending is due to the false belief that consumption comes before production. So production (jobs) is mostly a side effect of consumption. As a side effect it doesn't matter where the consumption comes from, just as long as you consume. So, when the people are cash poor, the government can borrow from the future or inflate the currency to increase consumption in the present which appears to grow the economy. Unfortunately, they do not see how the nation gets poorer when they do this. What they miss is production comes first and production needs investment which comes from society's excess past production, aka savings.

The reason the government spending paradigm fails is that inflation kills it in the end. Do you really think a government couldn't spend an infinite amount of money to create an infinitely great economy?  Money without production is worthless. As I said, demand is infinite. If the government money generation is equally limitless, then we have a situation where the government creates fake production (money is the representation of past production) with unending demand. That will only create poverty. Think of it this way, imagined production does not fill the shelves and the unlimited demand means lines will form to buy items which do not exist. Soviet style queues will form and  that simply is a pure, if not hellish,  poverty. You are not allowed to gain access to goods, yet the government is unable to deliver them, either.

Now, we are at the government stimulus part of the issue? Does stimulus work? Short answer is no. If government spending was the solution to all economic problems, we would have no economic problems. Simply every entitlement program would grow the economy and we would have zero debt, zero unfunded liabilities and endless prosperity. Somehow that happy result hasn't happened. We have untold levels of unemployment, $16T of debt and $120T of unfunded liabilities.

Why does this happen? First, you need to understand what investment is. Investment is the lending of money to others in order to create the future means of production in return for a specific portion of the profits. Keep in mind that the investment is the money you can afford to invest after you have produced enough to cover your immediate needs. In the animal model, it is everything you do before you die to get the result you want. It includes the thinking, the chase and the kill in the hunt. It includes the choice of a good place for your den and the creation thereof. Simply, you are living off your past success in order to achieve another success. If, as an animal, you cover your costs you live another day. If, you have a profit, you live many more days. In the modern world, people can use their excess production to buy stocks, bonds and other financial instruments in order to assist in building the future means of production for a return on that investment. The investment cycle is the often ignored part of the economy. Many feel you can skip that if government doles out the investment.

The biggest error of that concept is that government never lives or dies on their investment. They may always raise taxes to overcome their poor investments. Common investors lose money on poor investment choices. If a company makes a mistake, they risk bankruptcy. They will fail. Businesses have accounting practices which clearly shows, whether or not, their investments raise revenues. Government never does that. They love the cloudiness of their actions. If government was scientific, they would make very small changes in the laws and measure the success by the growth of revenue. Simply, if a single change in the tax code increased revenues by 10%, that would mean they did something right. Government does not care about that. They only care about whether or not you comply to their will.

That clearly shows that government will never be the best place to invest from. They just cannot do it for their very existence is never on the line. Only private individuals and private businesses can invest. They are the only rational entities capable of investing. They inherently have a true interest in a successful investment. The only way people profit from investing is when the means of production changes in a positive way that the free market agrees with.

The other issue with the government's "investment" in people, industries and programs is that if whatever they do does not boost production in needed commodities and services, they have just thrown our money away. Poor investment seems to be only a private sector problem due to ”irrational exuberance" (Alan Greenspan). In fact, some of their "investments" are merely social programs which push consumption without any true investment in the means of production. Simply, you are consuming without a serious amount of production, so in the end there are less products and services. Few ever question the government's poor investments due to the foolish laws passed to control human behavior. People usually will find a way around the rules and ultimately the government's rules do not have the desired results in the end. Think about it. The government spends billions to change behavior and it fails. Where does the money go? Down the toilet! It is wasted. The biggest disasters are that the private sector didn't get the chance to keep the money taken through taxes and wasted. The private sector didn't get the chance to borrow that money for true investment in the means of production.

A great example of poor government investment is Solyndra. The government spent money trying to boost a solar energy company in order to artificially create a public market for solar technology. It was a company favored by the government to create solar energy solutions. In the end, they went bankrupt and the American taxpayer is now on the hook for the guaranteed loans. You and I never picked that stinker as an investment. Our government did and we are now stuck.

GM is reported to still be on the road to bankruptcy. More of our money was spent by our government to prop up a privileged company and the taxpayer will be stuck with the tab. That is crony capitalism and not free market capitalism That is not careful investment, but payouts to campaign contributors. Those contributions are both direct from the company or indirect from the unions which wished to prevent the judgment day on their foolish contract demands which aided the demise of a once great company.

Finally, I will summarize the horrible affect of government action. The inflation of the currency or piling up of insane debt in order to grow the economy managed by government is counter productive. The money the government destroys hurts every American citizen and business. Every dollar the government borrows is a dollar a wise, free market business doesn't have the opportunity to borrow.

A truly free economy will be prosperous for no other reason as it can react as fast a free people's ability to choose the most beneficial use of that economy. There is no long wait for the government to act, the free market driven choices occur immediately and continuously.

The best economy is the economy the people choose. Government with lobbyist's money may not choose the economy we need. We deserve a free economy with the direct influence of a free people using the free market.

 I offer you two things I truly believe. 

The economic cycle is most honestly described as: Demand, Production and then Consumption.

The free market is the most direct, honest director of the economy.

Friday, August 3, 2012

President Obama? Yes, I built Vikkex!

President Obama's statement that businesses are not built by those who first imagine them and then create them is absurd. A business is more than infrastructure and the education of the creators. A business is a dream executed by people dedicated to success.

I run an IT consulting business. Most of my clients are those I have successfully reached out to and convinced to let me help them. I do not remember any government agent as my wingman during those negotiations.

The rest of my clients are those which were referred to me by my existing satisfied clients. Seems strange that they never mentioned the roads or my 7th grade teacher when they called. They all said that someone we had in common thought I did a great job and told them to call me on the phone.

Either cell phone or land line, those were private sector means of communications that myself and the clients paid for. Government did not make that. Government may have forced its rules upon everyone involved, but government did not punch down the wires or hook up the radio equipment. We the people did.

If you follow Obama's logic, on Christmas Day after you go over the river and through the woods to grandma's house for celebration with her, you didn't do that. Government was the driver of that event. Your love of your family didn't matter. Your determination to get there regardless of the weather didn't matter. The money you spent buying your vehicle, insuring it, maintaining it and fueling it didn't matter. Your skill in navigating 300 roundabouts to successfully get to her house didn't matter. In the end, only that government had a part in the roads mattered. The fact the government paid individuals to make those roads with your money is irrelevant.

It is very clear that Obama has never successfully worked in the private sector. He cannot see how the health care law that has been labeled with his name punishes those who hire people. He cannot see that the IRS with the guilty until proven innocent attitude threatens entrepreneurs and likely scares off many who would like to start a business. He cannot see how government crackdowns on lemonade stands are scarring the next generation of entrepreneurs. He doesn't understand how massive deficits consume capital which would be better used by business people to start or expand their businesses. He, simply, is not a capitalist. He does not embrace the America our founders created.

When the President of the United States demoralizes business people, we all have a serious problem. A problem I hope we correct in November.

By the way, President Obama, I built Vikkex! Yes, I did!

Wednesday, July 4, 2012

How to Create a Successful Whatever

People moan about the economy, yet they never seem to look deep enough to see the true problem. There is something seriously wrong with our economy, but few put their finger on it. What is the problem? Do you really want to know? Are you seriously willing to take the "Red Pill"?

Today, I worked one of the largest Independence Day parades in the Midwest getting signatures for Gary Johnson for President. Are you thinking of Chicago? If you are, then you will be wrong! I was working a parade in Racine, Wisconsin. Racine has less the 90,000 people, yet they have a huge parade.

I will pose a question for you? Why does Racine have so many people clamoring to participate? Well, I will give you a hint right here:

You will notice that you only need to put in a nominal fee to participate. If you are a simple person wishing enter, it is only 25 bucks. Even a commercial entrant only needs to pay 150 bucks. Simply, there is a very low bar of entry into the Racine Parade. You do not need to have a $50,000 float or exclusive contacts with the parade committee. When it comes down to it, they just want you there.

When you contrast that to many parades where you must pass a committee or have little commercial interest, it is clear that having an open door makes for a dynamic parade. A parade so dynamic that they have about 100,000 people showing up to watch it. A parade that was one of the 10 great places to celebrate the 4th of July in 2008, accordingly to USA Today!

Now,  I will direct your attention to our economy. We have the highest corporate taxes in the world. We have the most complicated corporate regulations in the world (Dodd-Frank). We have the IRS which will consider you guilty until proven innocent. We have 134,723 pages in 201 volumes of federal regulations (according to I feel it is no accident that the US economy doesn't shine. We have done the exact opposite of the Racine Independence Day Parade. We have created an entry barrier to entrepreneurs that is downright toxic.

If we truly wish to have a booming economy, then we must get our government out of the way. I can hear it now, that regulations make us safer. That is fundamentally untrue. Sarbane-Oxley did not prevent Bernie Madoff. That is as unspectacular as drunk driving laws not keeping drunks off the road.  Those which would change their behavior easily would only need a Public Service Announcement, while the incorrigible will break the law with impunity. The real threat with tough regulations is that people tend to feel drunks are under control along with the financial sector's thieves. Government actually creates the environment that provides cover to those who pose a threat to society.

The only thing tough regulation provides successfully is nearly boundless amounts of expensive paper work to businesses along with very costly fines with they fail to "jump the hoops" just right. So, honest companies need to pay a lot of money upfront and eventually more when the do not "mind their federal Ps and Qs". The true criminals just do whatever they do anyway. Ultimately, we have an economy where those who create real value are punished while the thieves get excellent "federal cover" as long as their paperwork looks good to the regulators.

So, if you wish to have a booming economy, then the entry into that economy for entrepreneurs must be low and reasonable. Otherwise, we will continue to experience the stagnation we live with today. We need less and simpler regulations. We need less and simpler taxation. The recipe for a booming economy is to invite "everybody" to participate and to be willing to actually let "everybody" participate. 

Gulp! Is that the darn "Red Pill" going down? Sorry, I know its going to be a tough ride.


Wednesday, May 23, 2012

Partisanship Is a Natural Effect of Big Government

Our nation is divided along many lines. The biggest is between the Democrats and the Republicans. People from all backgrounds bemoan the partisanship which has gripped the nation and has Wisconsin in the turmoil of a gubernatorial recall election.

However, few can see that they are the ultimate source of such hostile politics. They never consider that what everyone is bickering about is the use of a governmental power of some sort. The electorate, the lobbyists and the politicians are all fighting over how to use government force upon their neighbor. The way the force is applied is by demanding action from your neighbors or demanding their cash. Often, it is a combination of both. It should be clear that this is the source of partisanship for when force is used upon someone they will resist it.

When you force your neighbor to do something he does not wish to do, you make them your slave. When you demand their cash, you are robbing them. There can be no surprise whatsoever that such activity will incite an extremely vigorous defense. Often, your victim will turn about and use government force in much the same manner against you. This will only lead to continued escalation and it has done so for years. Government gets bigger as the force is applied in new ways. Eventually, every area of your life is under the domain of the government (your neighbors). Bitter partisanship is a direct consequence of big government. I will argue they are directly correlated and bigger government can only bring more intense partisanship. If people truly love big government, then they must learn to love the partisanship. You cannot have one without the other.

It is time to reverse course and bring civility back to our society. The diagnosis has been made, now for the prescription. It is very simple. We demand the removal of government force from as many areas of our lives as possible. When people are no longer using government to force each other to do things against their will, they will find that your lives will be far less politicized. Everyone must accept government is not the best solution for every problem and work with each other in voluntary cooperation.  Without all the bickering over how and when government should be involved in their lives,  people may determine they actually like each other and can live together in peace.

Big government breeds partisanship and hostility. Limited government offers little to argue over and provides the best opportunity for social tranquility. Let's all choose limited government.

Wednesday, May 9, 2012

Yes, I support Scott Walker in the Recall

I am going to cover an issue which comes up much more often than I like this election cycle. As many know, I have to circulate nomination papers during late April and May to get on the ballot for US Senate.

In the hostile political environment the unions have brought us, it is more difficult to be a candidate, regardless of party. I have heard many tell me they are DONE with politics. The question of the year is, "Are you against Walker or with him?"

I must say having a recall during a nomination paper circulation period is not at all fun. I can still make decent numbers, but I know I have lost many potential signatures due to the toxic environment the recall has created. I am not making things up here, I have run for office in the last two general elections and aside from the hard core Dems and Reps, I get many to sign my nomination forms, no questions asked. This year the name Walker has come up many times. In fact, in my other races the names of other politicians seldom came up, unless there were inquiries about others that the eligible voter may have signed for already. Considering that I am from Kenosha and have canvassed the exact same areas I did in 2008 and 2010, I am pretty sure my perceptions of the current political climate are correct.

Since, I do not wish provide false signals, I will offer here my position on the Governor Walker recall. Simply, I fully support Governor Walker in the recall. Please, do not consider this as a complete endorsement of Governor Walker. I cannot do that for I am a libertarian and he is not. However, I STRONGLY disapprove of any recall of an office holder that has not committed a crime, refused to do his job or has moved out of state. The proper place to decide on the merits of Scott Walker's performance would be in the 2014 general election. So, I support Scott Walker for he has done nothing to demand a recall.

So, I do not agree with the reasoning behind the recall and thus support Governor Walker to continue his term in office. I do agree with the work he has done on balancing the budget, though. Really, my principle platform is that I wish to help balance the budget at the federal level, so it is not that extreme that support such actions at the state level.

So far the only thing Walker has done is balance the budget. Oh, the humanity! The real bitter feelings from what I can tell are that Walker is anti-union or a union buster. However, there is nothing that he has done which shows that. All he did was change the rules on how the state and local governments can deal with benefits a union receives. Though that is surely unpleasant to union workers, it does not remove their rights to free speech, assembly and collective bargaining on wages. As horrible as the changes seem, those government workers still have a better deal than the majority of those footing the bill as taxpayers.

I could say that Governor Walker did go back on a promise to balance the budget with GAAP, however by holding off on that he prevented laying off many government workers. The mess he was trying to clean up from past was pretty big and he made the choice to not create more pain than was necessary. So, though he made changes the unions didn't like, he saved their jobs. The only places where job losses occurred were where the unions refused to come back to the table to figure out a way to prevent that. I hate to say it, but unions and their demands are major budget busters. They need to learn that they do not have the right to extort payments from the taxpayers.

There you have it, I do support Scott Walker in the recall. It is not a love affair. I have problems with him, but a recall is not a valid way to deal with that. In 2014, the Libertarian Party will have a candidate to challenge Walker and they will have my support.