Another great article from As A Mom website...
TANSTAAFL: The FIRST (and most important) Rule of Economics
Whether you consider economics boring, intimidating or just not your thing , there is at least one concept that you need to not only understand, but apply. TANSTAFL - there ain't no such thing as a free lunch.
I am sure that you have heard the term before, and probably gave it cursory thought, laughed it off and moved on about your life. But let's give it just another few minutes of consideration - and then evaluate how much of your life this simple rule affects.
Any product or service that is offered FREE of charge costs someone, something at some time.
Consider this every day example. You are shopping and you see a promotion that offers a free item with the purchase of a specific product. Because of the first rule of Economics, you know that the company offering the deal must have a plan to regain the costs in some other fashion. Costs can be buried within the price of the item you are purchasing. They may be disguised as "handling fees" or the company may be taking a calculated risk that investing in the gift will secure future sales or retain your patronage in order to cover the cost of the free item. Whatever the method, the gift-giver must account for the cost in some way or they will not be able to remain in business.
NOTHING of value is free.
Promotions for free stuff are rather easy to spot when they come from retailers vying for your business. Most people innately understand this simple rule of economics when it comes to things that you purchase voluntarily. And, generally speaking, we make our choices to buy or not to buy based on our perceived value added to the transaction and on which product package will best serve our needs. This is a good example of the Free Market at work.
But what about involuntary transactions?
The Government takes our money, involuntarily, through taxes, both directly (income tax or tax on profits) and indirectly (taxes on goods and services). It is very important to understand that no government has any money of its own. Government officials are charged with the duty to be the stewards of our money taken in taxes and to provide us with an order of society that allows equal opportunity and equal protection for all.
All government spending is the spending of YOUR money.
Our elected representatives (city, state and federal) spend our money. According to the US Constitution, money collected in Federal taxes can only be spent on things that benefit EVERYONE in society equally. Over the years, however, this "rule" has been left by the way side. Our government boasts of all the services it offers - whether we want them or not – and continues to add more. Most of us are not eligible for most of the services that we pay for. Welfare programs give our money to poor people and subsidy programs give our money to corporations.
The practice of taking money unequally from some members of society (through our progressive taxation system), and then returning that money unequally to other members of society (through welfare and subsidy programs) is known as "redistribution of wealth." The Government is constantly scheming to create programs that they portray to us as "free stuff," but since we know that TANSTAAFL, we must also know that these programs have to be paid for.
If the Government does not have any money that they do not first take from us, it follows that we must, in fact, pay for the programs, involuntarily, through taxes. Following this logic further, if you are not poor and receiving welfare, or a corporation that receives subsidies, a large portion of the "free stuff" is being given to other people, but paid for by you.
The myth of "free" ends here with the bulk of American workers in the Middle Class.
It is our absolute duty as American citizens to be aware and to actively participate in our Government. We must be diligent. We must pay attention. We must make informed decisions and insist that our friends and family do the same. We are where we are today because as a country, we have become complacent. We have fallen for the Government's Marketing Campaigns and have allowed Government to grow consistently larger. Larger Government requires more money to maintain itself and the only way for the Government to get more money is to market more products that we, through our own inaction are forced to purchase. By our apathy we have perpetuated the cycle of collection and redistribution of our individual wealth - resulting in nothing less than the continuous loss of personal liberty and the voracious strengthening the collective agenda.
We must stop the cycle.
©Copyright Diana Learn & AAM 2009
And to that I say, AMEN!