Whenever I feel sad about how inflation is devaluing my roll0ver IRA, it makes me feel better to listen to Paul Ryan.
To see what Paul Ryan is concerned about, you can see the charts of the federal budget here.
Tag Archives: Entitlement
New study finds that immigration costs Canada up to $23 billion a year
Story in the National Post. (H/T Andrew)
Excerpt:
Newcomers to the country generally make less money and chip in less in taxes than the national average.And allowing 250,000 immigrants into the country annually is costing us all billions of dollars each and every year, according to a study by the Fraser Institute.
The study, dubbed Immigration and the Canadian Welfare State, sharply criticizes Canada’s current immigration system, using earnings and other figures from the 2005-06 fiscal year reported by 844,476 people in the 2006 Census.
It claims the group as a whole earned on average about $10,000 more and paid about $2,500 more in income taxes annually than those within the sampling who had settled in Canada in the previous 18 years.
The study also found immigrants typically pay a little over $6,000 less in property and sales taxes than the national average.
That means the approximately 3.9 million immigrants who settled in Canada between 1987 and 2004 are shortchanging federal government coffers by between $16.3 billion and $23.6 billion annually, depending on how many of those newcomers have moved back home, emigrated elsewhere or died, the study said.
[…]The study also takes on the notion that immigrants are helping the country by taking menial jobs that most Canadians don’t want.”Immigrants do fill jobs that Canadians don’t want and thus benefit the economy but, in the absence of immigration, these jobs would pay higher wages and would be filled by Canadians or eliminated by the application of labour-saving technology,” the study states.
“Under these conditions, poverty in Canada would be reduced substantially.”
As for changes, the study suggests annual immigration numbers should be increased or decreased, depending largely on “market forces.”
The study also recommends Canada be more selective, allowing only newcomers who have employment lined up, offering them citizenship only if they hang onto their job for a set number of years and deporting those who lose their jobs.
Canada has a welfare state with single-payer health care, public housing, welfare payment and free public schools. So, people who cannot pull their own weight can rely on all of these goodies provided by the working Canadians. Because of these generous benefits, Canada has a lot of people who would like to move there from poor countries. And they can’t possibly take them all in because it is costing the working Canadians billions of dollars. But there is a way for them to allow more immigration – they just have to stop all of their government handouts. If there were no handouts then everyone could come to Canada freely, because they would go home again unless they held on to their job and pulled their own weight. They could even bring their families once they had worked hard enough to support them – but those family members would not be eligible to get money from the government.
So what do we as Americans learn from this? Well, we need to make sure that the people who come here are selected on the basis of their skills, their education, their ability to pay their own way. We need to have a big fence to keep illegal immigrants out, and we need to have a huge gate to allow skilled legal immigrants in. And they can even bring their families with them – as long as they don’t get a dime of taxpayer money in cash or through social programs – they should have to pay for everything they use, including schools and health care. And they should not be eligible for a dime of government money until they get their green cards after years of demonstrated hard work and clean living.
Capitalist Chile posts 15.2% yearly increase in GDP
Investors Business Daily explains the economic policies that allowed Chile to post 15.2% yearly growth.
Excerpt:
As the U.S. languishes, Chile posted a head-turning 15.2% yearly gain in GDP in March, and forecasts for the year are rising. Why can’t we do that here?
A year ago, Chile lay in rubble, victim of the world’s fifth most powerful earthquake. So Chile’s 15.2% growth is a big bounce from a bad setback.
But it shouldn’t be dismissed as an anomaly. It’s a showy number, but not the only one.
The same day Chile released its data, Goldman Sachs raised its 2011 growth forecast for the country to 6.4% from 6%. In its annual regional business index, Latin Business Chronicle ranked Chile as having the best business climate in Latin America in 2011.
Such numbers are so alien to the U.S. in the economically debilitated Obama era, it makes sense to look at what Chile has done.
First, Chile’s policies for long-term growth were put into effect in the 1980s by the group of Milton Friedman-inspired economists known as the Chicago Boys.
Under them, Chile’s pension privatization cost nothing and left the country with no net debt. The private funds now hold assets worth 90% of GNP ($185 billion) — capital used to develop the country. Already, Chile’s education and infrastructure are the best in Latin America as a result.
Second, there’s free trade, of which Chile is a global champion, signing at least 58 treaties to gain access to 2 billion customers.
That’s a big reason Chile is close to full employment and is scrambling to attract growth-hungry U.S. entrepreneurs — and getting them.
[…]Bamrud says Chile has been turning heads with investors the past year and a half because of its emphasis on improving its corporate environment, its tax regime and its economic freedom, all of which rate highly.
“Chile has always been held out as a model for Latin America, but the reality is … it’s now a model for the U.S.,” he said.
Corporate taxes are the second lowest in Latin America at 18%, behind Paraguay’s 10%. The Latin average is 28%.
Meanwhile, Goldman Sachs’ chief economist for Latin America, Alberto Ramos, says Chile has wisely fostered growth by reducing the size of government and not printing too much money.
In 2011, it cut government spending to 5% of GDP, or $700 million, more than its projected 5.5%. So GDP has room to grow 6.4%, rather than 6% as first estimated.
Chile is doing the exact opposite of the socialist Barack Obama. Chile is cutting government spending, removing tariffs, enacting free trade deals, and cutting corporate taxes. Businesses and investors are moving there, and there are not enough people to work at all the jobs that are being created. Meanwhile, in Venezuela, communist dictator Hugo Chavez just reported 0.6% gain in the last quarter of 2010.
But wait! There’s more good news from Chile!
Investors Business Daily writes again about Chile’s privatized retirement program. (H/T Tina)
Excerpt:
May Day — socialists’ paean to class warfare — evokes memories of Soviet tanks in Red Square and leftist radicals rioting. But Chile celebrates the actual empowerment of workers.
May 1 marks the 30 years since Chile became the first nation to privatize its social security system. By turning workers into investors, the move solved an entitlement crisis much like the one America faces today.
“I like symbols, so I chose May Day as the birth date of Chile’s ‘ownership society’ that allowed every worker to become a small capitalist,” wrote Jose Pinera, former secretary of labor and social security and the architect of this pension revolution. He is now a senior fellow at the Cato Institute in Washington, D.C.
What he designed has succeeded beyond all expectations. Yet Congress remains reluctant to adopt anything like it, despite efforts by Presidents Bill Clinton and George W. Bush to partially privatize an American system.
Instead of paying a 12.4% Social Security tax as we do here, Chilean workers must pay in 10% of their wages (they can send up to 20%) to one of several conservatively managed and regulated pension funds. From the accumulated savings, they get a life annuity or make programmed withdrawals (inheriting any funds left over).
Over the last three decades these accounts have averaged annual returns of 9.23% above inflation. By contrast, U.S. Social Security pays a 1% to 2% (theoretical) return, and even less for new workers.
[…]In 2005, New York Times reporter John Tierney worked out his own Social Security contributions on the Chilean model and found that his privatized pension would have been $53,000 a year plus a one-time payout of $223,000. The same contributions paid into Social Security would have paid him $18,000.
The biggest threat to American solvency is the growth in entitlement spending on Medicare, Medicaid and Social Security. The Democrats are stubbornly opposed to reforming these benefits, because they like the idea of transferring wealth from children, who cannot vote, to people who depend on government hand-outs, who can vote. And the best part of their scheme is that young people can be easily indoctrinated by the public schools to believe that have their future mortgaged away to buy votes is a good idea. It’s really very sad and unfair to young people.
WINTERY KNIGHT 