How Do You Spell Relief? 1099

The infamous 1099 requirement of the health care law has been repealed.  Thank heaven for small favors.

For those not familiar with this issue, a recap.  Buried within the blazing stupidity of the health care bill was a provision that business transactions totaling over $600 per year with any other businesses must be reported.  For small businesses, this would have been a nightmare.  One wonders what could possibly have motivated it in the first place.

I have my suspicions.  As inflation erupts here and there in the global economy (just wait–we’re next), many of our leaders are worried that some of us might start acquiring a significant amount of real money–gold and silver.  Right now, we only need report transactions over $10,000.  That is wrong in my view, but it beats $600.

Further, we only pay taxes if we sell our precious metal.  That is, a tax is assessed on the capital gains.  What would such a stringent reporting requirement as the now-repealed 1099 provision have done?  It would have paved the way for a value-added tax.

A value-added tax is levied on the estimated increase in value of a product as it goes through manufacturing.  A tiny stretch and you have taxes levied on the appreciation of precious metals before they are sold. This would not only rake in tax money, it would also discourage investments in precious metals and shore up the fiction that is our currency.

Don’t think it can happen?  Gold really hacks off big-government types.  It shows the world how worthless paper money is becoming and how hopelessly inept they are at managing anything more complicated than a bowel movement.  FDR just plain took everyone’s gold at one price and then turned around and revalued it.  Don’t think for a minute Obama would not do the same or worse.

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Terry has received numerous complaints from Dunces United Hereafter (DUH) about his references to members of Congress as “dunces.”  DUH members resent being associated with politicians of any stripe.  Terry sympathizes with them, but is pretty sure they’ll forget all about it this afternoon.

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About Terry Noel

I am an Associate Professor of Management and Quantitative Methods at Illinois State University. My specialty is entrepreneurship.
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