Taxes

Traffic light incidence has also made me think one more thing - why we are suppose to pay taxes? What gives government right to ask to pay us taxes? And worse, what gives them right to penalize us for not doing it or doing it late? So i did some research...

Research on Tax

Historically record for Taxing the people have been found in various old cultures, like, Egypt, Greece, Roman Empire, Indian Kings, and so and so on...

History of Taxes in United States
In 1794 Settlers west of the Alleghenies, in opposition to Alexander Hamilton's excise tax of 1791, started what is now known as the "Whiskey Rebellion" The excise tax was considered discriminatory and the settlers rioted against the tax collectors . President Washington eventually sent troops to quell the riots. Although two settlers were eventually convicted of treason, the President granted each a pardon.
In 1798 Congress enacted the Federal Property Tax to pay for the expansion of the Army and Navy in the event of possible war with France. In the same year, John Fries began what is referred to as the "Fries Rebellion," in opposition to the new tax. No one was injured or killed in the insurrection and Fries was arrested for treason but eventually pardoned by President Adams in 1800. Surprisingly, Fries was the leader of a militia unit called out to suppress the "Whiskey Rebellion."

The first income tax suggested in the United States was during the War of 1812. The tax was based on the British Tax Act of 1798 and applied progressive rates to income. The rates were .08% on income above £60 and 10 percent on income above £200. The tax was developed in 1814 but was never imposed because the treaty of Ghent was signed in 1815 ending hostilities and the need for additional revenue.

The Tax Act of 1861 proposed that "there shall be levied, collected, and paid, upon annual income of every person residing in the U.S. whether derived from any kind of property, or from any professional trade, employment, or vocation carried on in the United States or elsewhere, or from any source whatever.

The 1861 Tax Act was passed but never put in force. Rates under the Act were 3% on income above $800 and 5% on income of individuals living outside the U.S.

The Tax Act of 1862 was passed and signed by President Lincoln July 1 1862. The rates were 3% on income above $600 and 5% on income above $10,000. The rent or rental value of your home could be deducted from income in determining the tax liability. The Commissioner of Revenue stated "The people of this country have accepted it with cheerfulness, to meet a temporary exigency, and it has excited no serious complaint in its administration." This acceptance was primarily due to the need for revenue to finance the Civil War.
Although the people cheerfully accepted the tax, compliance was not high. Figures released after the Civil War indicated that 276,661 people actually filed tax returns in 1870 (the year of the highest returns filed) when the country's population was approximately 38 million.

The Tax Act of 1864 was passed to raise additional revenue to support the Civil War.
Senator Garret Davis, in discussing the guiding principle of taxation, stated "a recognition of the idea that taxes shall be paid according to the abilities of a person to pay."
Taxes rates for the Tax Act of 1864 were 5% for income between $600 and $5000; 7.5% for income between $5001 and $10,000; 10% on income above $10,000. The deduction for rent or rental value was limited to $200. A deduction for repairs was allowed.
With the end of the Civil War the public's accepted cheerfulness with regard to taxation waned. The Tax Act of 1864 was modified after the war. The rates were changed to a flat 5 percent with the exemption amount raised to $1,000. Several attempts to make the tax permanent were tried but by 1869 " no businessman could pass the day without suffering from those burdens" The Times. From 1870 to 1872 the rate was a flat 2.5 percent and the exemption amount was raised to $2,000.
The tax was repealed in 1872 and in its place was installed significant tariff restrictions that served as the major revenue source for the United States until 1913. In 1913 the 16th Amendment was passed, which allowed Congress authority to tax the citizenry on income from whatever source derived.
It should be noted that the Tax Act of 1864 was challenged several times. The Supreme Court unanimously supported the tax. After the war the tax was declared unconstitutional by the same court because it represented direct taxation on the citizenry which was not allowed under the constitution.

1930's

During the 1930's federal individual income taxes were never more than 1.4 percent of GNP. Corporate taxes were never more than 1.6 percent of GNP. In 1990 those same taxes as a percent of GNP were 8.77 and 1.99 respectively

Here is how i see it:
Tax is invention of governing bodies, could be King, or Modern government, could be Autocrat or democrat. How you think those early Pharaohs could afford the cost of making Piramids, or Taj Mahal by Mugal emperor Shah Jahan... By taxing

It has been so old and people are so used to paying taxes, no one now a days think, why do i have to pay tax...

Every animals who leaves in herd, have herd leader, whether, it's wolves, horses, sheep, goats, cows, yaks, camels, monkeys or humans...

Human leaders over the times are known as different names, tribal leaders, kings, president, prime ministers... but they all have one common job description, lead the group they are accepted as leaders. They had responsibilities towards the group, to defend, to prosper, to mediate, in return, they get respect from group. Group looks up to leader...

And Power Corrupts, over the period, those leaders becomes rulers... they believe ruling is their right... and they have power over the group to make them do what they think right. They made them build big buildings, they push them to wars, they force them to pay for their expensive lifestyles.

At this time i am thinking of two Mughal emperors, father and son... Shah Jahan and Aurangzeb... The one very popular and one very unpopular... Shah Jahan who has built Taj Mahal, the greatest expression of love ever and so and so on... on the other end, Aurangzeb, alleges for initiated laws which interfered with non-Muslim worship and destruction of several Hindu temples... People thinks Shah Jahan was good and Aurangzeb was bad... but the way I see it and what they do not see is this, Shah Jahan has wasted public money to create something of the personal nature, tomb for his wife, while Aurangzeb never drew salary from state treasury but earned his own living by selling caps he sewed and selling copies of the Quran he copied by hand. Ruler does not own state treasury, they are there as administrator of the treasury.

Little side tracked, didn't i?

Anyway, so at some point, those rulers have decided in order to expand their reign, and satisfy their greed of being great ruler, they need army, in older society, every men in group were the soldier, but as time pass and society become more specialized, where some group of men were groomed and specialized in art of war, . In order to pay those men. those leaders now need money. In old days, leader himself used to play the role of judge when needed, but as a ruler he has other priorities, also now the group is bigger, so he need men specialized in art of mediator, and to make sure there is uniformity, they needs written laws, and judiciary system. And now to pay those they need more money. As a leader, he thought, two heads are better than one, he needs group of advisers, and courtiers came, and you need more money...

How to generate revenues? beg, borrow or steal... They are rulers, they have power, obviously they are not going to beg.
For years, those ancient rulers fought wars and collect treasure. Basically, survival of the strongest, they looted...
The oldest record, in Greece, in times of war the Athenians imposed a tax referred to as eisphora. No one was exempt from the tax which was used to pay for special wartime expenditures. The Greeks are one of the few societies that were able to rescind the tax once the emergency was over. When additional resources were gained by the war effort the resources were used to refund the tax. there comes borrow - leaders borrowed money as tax from citizens, and they refund it back when they got from war.
In modern world, when war are considered taboos, the only way to generate revenues, are left to be tax their own citizen. They decided well they are rulers, they have responsibilities towards the group, why not to charge them with taxes in return, almost like the bully in the school, you have to do homework for him, give him food from your lunchbox for the security. And as time passes the greed of the ruler grow more and more just like that bully in school, once he knows he can get his way, he increases his demands...

Do you see the trend now in history of taxes?

Thought on Health insurance issue at Traffic Light

few days back i was driving at 2 AM in morning and came to stop at traffic light. Looked around, i was the only one at that intersection. Waited for few minutes for it to turn green, and headed on to my destination.

While driving a sudden thought had strikes me. Why do we have to stop at red light? it took me back when i was kid and living in small city called Vadodara in state of Gujarat in India. And i do remember my very first encounter with Traffic police, he was old man and neighbor where we used to live. That means i am talking something that is less than 30 years old story. There used to be human police man, also known as traffic police, standing in center of intersection and guide the traffic.

I did little research and found this information for some one who might be interested:
Even during the horse and buggy days, traffic in big cities was often heavy. Police officers had to be stationed full time directing traffic at busy intersections.
On 10 December 1868, the first traffic lights were installed outside the British Houses of Parliament in London, by the railway engineer J. P. Knight. They resembled railway signals of the time, with semaphore arms and red and green gas lamps for night use. The gas lantern was turned with a lever at its base so that the appropriate light faced traffic. Unfortunately, it exploded on 2 January 1869, injuring the policeman who was operating it.
The modern electric traffic light is an American invention. As early as 1912 in Salt Lake City, Utah, policeman Lester Wire invented the first red-green electric traffic lights. On 5 August 1914, the American Traffic Signal Company installed a traffic signal system on the corner of East 105th Street and Euclid Avenue in Cleveland, Ohio. It had two colours, red and green, and a buzzer, based on the design of James Hoge, to provide a warning for colour changes. The design by James Hoge allowed police and fire stations to control the signals in case of emergency. The first four-way, three-colour traffic light was created by police officer William Potts in Detroit, Michigan in 1920. In 1923, Garrett Morgan patented a traffic signal device. Ashville, Ohio claims to be the location of the oldest working traffic light in the United States, used at an intersection of public roads until 1982 when it was moved to a local museum.

Traffic light technology I am sure has been invented and is constantly evolving with the aims of improving reliability, visibility, and efficiency of traffic flow. The very latest on the line is Red light cameras... an automated camera is connected to the triggering mechanism for the corresponding traffic light, which is targeted to photograph any vehicle which crosses against the light. The driver or owner (depending on local laws) of a vehicle so photographed can then be fined for violating traffic laws.

Someone will say, thanks for the information but what it has to do with health care, coming back to the point:

the thought that had stricken me was, if there was human police at 2 AM(???) standing there, what he would have done... let me stand for those 3 - 4 minutes?

its not important at this point, that the only time waste was 3 to 4 minute. If I count so many people like me those minutes will grow exponentially, and add the cost to the car, breaks, gas so and so on... but that is not the point i am trying to make....

So what is the point
people needed to travel and were traveling for thousands of year, before any government even existed. Government thought a brilliant idea, let us devise system where we will control the traffic. So , suddenly from individual, or citizen you became Traffic. not human but traffic that needs to be governed. first came the system where some government official, with power to stop or let you go, with mere flick of hand. What worse..., well we can not pay those employees let us replace them with machines. Control those Traffic with machines. Oh and what is worst, economy is bad, we have deficit in our budget... let us put some camera and charge the Traffic for not obeying. I still remember the ticket i got with picture of my car, front and back in color, showing - I have ran the red light for 0.01 second. Can human reflex be accurate up to 100th of a second???

Now let us talk health care... people needed the access of health care, and getting health care before any government even existed. Medicine was considered holy profession, doctors were respected as some one who comes next to god. I still remember when i was kid, we had one doctor and he was treated as celebrity in my village. I still remember going to doctor and tell him what i am going through (symptoms) and he used to listen carefully, listen to the heart bits... go mix some medicine in mystery liquid and give in bottle that i used to carry from home. Just like those cloth bags, which later replaced by poly-thin plastic bags, the system of carrying your own medicine bottle is replaced by prescription. In my last visit to India this year, i met our family physician, who surprisingly still gives medicine not liquid but tablet forms (yellow, Red, Orange, White - unbranded) in paper packets. you go to him every day, he will listen, and if needed change the medicine tablet and so and so on... this things goes on until you are cured. For last few years i had found myself in position (in India) while taking medicine in front of someone, they look at me strange way, and sometime even asks, is still your doctor, gives medicine this way? I can see very clearly in their eyes written, Your doctor is old fashion - old is bad - change your doctor.

Let us see the new fashion doctors - go to doctor, he runs several tests, prescribe you the medicine for X days. Come back once the dose is over and you still needs me. No continuous monitoring, no doctor / patient relation... and worst, lost the respect.. While my work with Lab System company, I came across the other side of the profession where they had to be business man... even if i don't like it, it is what it is.

looks like i got side tracked again... My point is the profession of medicine has changed over the period instead of charging Rs 20 for home visit 10 years back, or Rs 5 for office visit which includes diagnosis and medicine. we are at Rs 1500 per office visit and forget about home visit. Who does that these days? (any one who knows what were the doctor office charges in US 20-30 years back please comment)

Health Insurance:

My curiosity lead me to this website where i have found the history of health insurance:
http://www.neurosurgical.com/medical_history_and_ethics/history/history_of_health_insurance.htm

Some highlights:

In 1929, the first modern group health insurance plan was formed. A group of teachers in Dallas, Texas, contracted with Baylor Hospital for room, board, and medical services in exchange for a monthly fee.
1932 nonprofit organizations called Blue Cross or Blue Shield first offered group health plans. Blue Cross and Blue Shield Plans were successful because they involved discounted contracts negotiated with doctors and hospitals. In return for promises of increased volume and prompt payment, providers gave discounts to the Blue Cross and Shield plans.
Employee benefit plans proliferated in the 1940’s and 1950’s. Wartime (1939-1945) wage freezes imposed by the government actually accelerated the spread of group health care. Unable by law to attract workers by paying more, employers instead improved their benefit packages, adding health care. Strong unions bargained for better benefit packages, including tax-free, employer-sponsored health insurance.
During the 1980’s and 1990’s, the cost of health care rose rapidly and the majority of employer-sponsored group insurance plans switched from “fee-for-service” plans to the cheaper “managed care plans.” As a result, most Americans with health insurance were enrolled in managed care plans by the mid-1990s

The things i have highlighted in highlights:

• Health Insurance is the contract between two parties where one party agrees to provide monitory help agreed in the contract to another party in case he need health care services.
  
• Group health plan was first offered by not for profit organization (BCBS), yes that's how it was started.
  
• Employer provided health insurance was started by employers as benefit package to attract workers since government was not allowing them to pay more.
  
• Unions have made them even sweeter for the employees
  

So basically Health insurance is nothing but business and is agreement between you and the insurance company of your choice. You are agreeing that Insurance company will pay towards the health care expense at agreed terms if you pay them fix payments every agreed period. And like any business transaction, no party should be forced to enter in business transaction.

And with what is going on by government, what i feel is, government is intervening in this business transaction with another system of theirs, just like they have done for the Traffic.

Let us talk back about the Traffic light system, here are the words of transportation engineers:
According to transportation engineers, traffic lights can have both positive and negative effects on traffic safety and traffic flow. The separation of conflicting streams of traffic in time can reduce the chances of right-angle collisions. But also the frequency of rear-end crashes can be increased by the installation of traffic lights, and they can adversely affect the safety of bicycle and pedestrian traffic. They can increase the traffic capacity at intersections, but can also result in excessive traffic delay. Hans Monderman, the innovative Dutch traffic engineer, and pioneer of shared space schemes, was sceptical of their role, and is quoted as having said of them: "We only want traffic lights where they are useful and I haven't found anywhere where they are useful yet".

Shared space is a traffic engineering concept involving the removal of the traditional separation between motor vehicles and pedestrians and other road users, and the removal of traditional road priority management devices such as kerbs, lines, signs and signals.

The reasoning behind the idea is that it will result in improved road safety by forcing users to negotiate their way through shared areas at appropriate speeds and with due consideration for the other users of the space, using simple rules like giving way to the right.

Here are some Results:
United States
In West Palm Beach, Florida planners are reported to have removed traffic signals and road markings and brought pedestrians into much closer contact with cars. The result has been slower traffic, fewer accidents, and shorter trip times.[20]

Sweden
Since the zebra crossings and traffic signs were replaced with a spacious fountain, benches and other street furniture, the Skvallertorget square in Norrköping has experienced no accidents, mean traffic speeds have dropped from 21 to 16 km/h (13 to 10 mph) and liveability has increased.[14]

Netherlands
There is a traffic sign at the entrance to Makkinga which reads "Verkeersbordvrij" meaning "free of traffic signs". The town has no road markings and no stop signs or direction signs visible in the streets. Parking meters and stopping restrictions are also absent.[4] Drachten is one of the pioneer towns for such schemes. Accident figures at one junction where traffic lights were removed have dropped from thirty-six in the four years prior to the introduction of the scheme to two in the two years following it. Only three of the original fifteen sets of traffic lights remain. Tailbacks (traffic jams) are now almost unheard of at the town's main junction, which handles about 22,000 cars a day.

Learning:

In answer to a direct question about the role of local legislation, a member of the Shared Space Expert Team replied:
“ To understand how shared space works, it is important to move away from reliance on "rights" and laws, and to recognize the potential for conventions and protocols. ”

“ Such conventions and protocols evolve rapidly and are very effective if the state does not intervene through regulation. ”

OBAMA's Foreign policy - Honduras

Lot of people now a days talk about Acorn and health care policy and how it's affecting President Obama, so i though i talk little different...

Foreign policy:
The biggest PR campaign ran effectively by then candidate Obama's Campaign against Republican VP candidate Sarah Palin was, her Foreign Policy experiance. Remember the famous comment "I can see Russia from my house."
Well no one took effort even to check out, what really had happened in the interview, well it's past, but let me put it here for some one who is interested.


Not trying to defend Sarah Palin or anything, but that time i had posed question, we are questioning the experience for VP candidate on one side, why are we not questioning the other side for Presidential candidate???

Incident at Honduras has actually uncover the big issue what i had tried to raise.

U.S. President Barack Obama said on Monday the coup that ousted Honduran President Manuel Zelaya was illegal and would set a "terrible precedent" of transition by military force unless it was reversed.

"We believe that the coup was not legal and that President Zelaya remains the president of Honduras, the democratically elected president there," Obama told reporters after an Oval Office meeting with Colombian President Alvaro Uribe.

Here is the problem, he didn't do the fact check - the Honduran military did NOT arbitrarily take power. Unlike former Honduran president Manuel Zelaya, it followed the rule of law and obeyed the highest court of Honduras.

The Honduran congress and supreme court rejected Zelaya's proposed referendum as illegal.

Then Zelaya confiscated the referendum ballots and tried to proceed with the vote.

Upon receiving an order from the highest court of Honduras, the Honduran army arrested Zelaya before the referendum could take place.

Yet the Obama administration was outraged that the Honduran army followed Honduran law and is backing the power-hungry Zelaya.

I think this is bigger blunder and foreign policy disaster. The Obama administration has effectively turned Zelaya into a symbol of democracy" while Zelaya "is exactly the opposite." The Obama administration does not believe that the highest court of Honduras is entitled to order that the constitution of Honduras be enforced.

So how confident should Americans be that Obama will respect the United States Constitution?
Thats my view - You decide....