Posts by Thomas Anderson6

Harold Martin10 said:The minority is what fills the treasury, while the majority draws from it. If you look at it that way, the small group funding the budget is technically wealthier on average. So, you basically take from the broad base of people—retirees, those on social programs, etc.—and leave it to the "capitalists" (small business owners and entrepreneurs).

It doesn't really feel like that's what people mean when they talk about "stimulating consumption" here in the USA. Usually, when someone mentions stimulating consumption, they imply that the general public should have more money in their pockets, not less.

And regarding that second point—when exactly is this money supposed to appear, and where is it coming from to pay for salaries, pensions, social benefits, and interest on the debt in the meantime? Are you suggesting the budget would be healthier if the government just slashed taxes? If that were actually a viable solution, I'm pretty sure both the Republican Party and the Democratic Party would have done it by now.

The reality is, there isn't any real saving happening in the USA or in Greece—not in any country facing a debt crisis, for that matter, because all these nations still spend far more than they bring in.

Even though this is off-topic...
that is precisely the issue. We spend the bulk of the budget irrationally, yet "stimulating consumption" is treated as if it's the citizens and corporations spending, rather than the government itself. A budget is a cash box that must be balanced; it should always be designed starting with projected revenue, then adjusting expenditures accordingly. Here, we do the exact opposite—which explains the results.

Try planning your own household budget by deciding what you want to spend first and then trying to scramble for the income to cover it—do you see the flaw in that logic?

Regarding filling the coffers, I believe lower taxes would yield a better budget in the medium and long term—it's an empirical fact. Try convincing me otherwise. Just look at the USA: under this current administration, we see increased tax pressure and discipline (which is fine, no argument there), but what’s the result? The deficit is skyrocketing. Why? The drop in business activity outweighs the tax hikes, causing revenue to plummet. That should be obvious to any economist with a high school education.
Without recovering consumption and boosting business activity, there is no progress. Furthermore, heavy tax pressure kills entrepreneurial spirit—who is going to build anything if the state takes everything and leaves you with nothing?
Ultimately, you're looking at a vicious cycle and a government that lacks both vision and the political courage to act...

My response to Nancy Gomez26 (not quoting your entire post):
I still feel like we’re talking about two different things. In principle, what you wrote regarding business operations is how a functional system *should* work—on that, we agree—but reality is a far cry from theory. Take pre-bankruptcy settlements, for example; write-offs happen constantly, and the ones left holding the bag are almost always the small businesses and local contractors. And it isn't even their fault. So, let me ask you again: is that fair? You have to accept the fact that not every small business owner has the luxury of operating the way you described—it’s simply impossible due to the nature of certain industries. Name one B2B partner that can function on a "pay when the sun rises" basis. Now, throw in this crisis, systemic failures, government incompetence, and crushing tax pressures, and what do we get? Waves of people who can no longer cover their obligations—let alone basic living expenses—because a small business owner is a human being who needs to eat just like their employees do. Simply put, the system needs a total overhaul, but it absolutely must prioritize the people involved.
Being an entrepreneur inherently involves risk and reward, but here, it feels like the entrepreneur absorbs all the risk while the state—or rather, the system—bears zero responsibility. How do you justify a scenario where you complete a job, the client goes bankrupt, your receivables vanish, and your "reward" is a tax bill that triggers a bank freeze? That is exactly my point. Then they offer installment plans with 15% interest, leaving you with no way out without being a massive loser on both sides.
The government treats entrepreneurs like a wicked stepmother—actually, worse. Imagine if we had a system that allowed everyone to freeze the government's accounts just as easily as the government freezes ours; the panic in Washington would be instantaneous. Imagine if small family farms could freeze federal funds? If social security recipients could freeze the Treasury? Or look at the recent case of professors who weren't reimbursed for travel expenses per their contracts—why shouldn't they have the right to seize government assets to settle those claims? Or other federal contractors?
To me, this is nothing short of pure coercion against the people...

Nancy Gomez26 said:With all due respect, I have been a small business owner for over 20 years, living solely off my labor in the real sector. In fact, the industry I operate in is about as "real" as it gets.
As for "not knowing the subject matter"—if that were true, I would be facing the exact problems you are describing right now.

Regarding the drop in consumer spending—that is actually a positive development. Consumption cannot, and should not, be an end in itself. No amount of mindless spending will save this economy, whether it's here in the States or anywhere else; only production moves the needle. The system needs to be purged of those who refuse to pay, but also of the naive players who conducted business based on nothing more than a handshake or a verbal promise. At first glance, this might seem unfair, but it is simply basic market selection. It is fundamentally irrational to provide goods or services without receiving payment. Yet, in our current climate, it has become normalized. Some have built entire commercial empires just by failing to pay for the inventory sitting on their shelves. This pattern of non-payment must be eradicated. My hope is that we insist on strict payment terms so we can finally evolve into an economy with streamlined, efficient relations. Only those with actual capital should be permitted to conduct business. One cannot operate using someone else's capital without providing fair compensation, such as interest. When you fail to pay interest on borrowed capital—be it in the form of inventory or cash—there is a natural tendency for repayment timelines to stretch toward infinity. Without interest, the value of what eventually gets repaid is eroded by inflation. If these "creditors" failed to account for the risks inherent in the relationships they themselves established, they must now face the consequences of their own poor business decisions.

First off, I haven't said anything bad about you personally, so let's clear that up.
Second, you've been an entrepreneur for 20 years, but I don't know your field—and there's a massive difference between a jeweler or a baker in the B2C sector and, say, a locksmith or a carpenter in the B2B sector. Those in B2B are the ones hitting the wall here. I'll agree with you that a baker or a tailor, who mostly handles cash transactions at a register, can easily cover their costs within reasonable windows—no issue there. But consider this:
An entrepreneur who supplies semi-finished goods to another firm, working within a long-term contract, might be waiting up to 300 days for payment from their client. Eventually, that client hits a liquidity crisis and leaves the supplier hanging—even through no fault of the supplier's own. What happens next? The client gets hit with an IRS freeze, which prevents them from paying the supplier; then the supplier gets frozen, unable to pay their own bills. See where I'm going? It creates a domino effect started by the government, where everyone sinks, no one gets paid, and the debt pile just keeps growing. That is the reality I am talking about.

And now, someone will suggest we just seize the entrepreneur's assets to settle the debt, right? Is that "fair" to you?
What about the entrepreneur who spent years playing by the rules, turning a profit, and paying taxes, only to build up personal assets from those profits—will they lose everything because of a systemic collapse they didn't cause?

Do you see the complexity of the problem now?

Nancy Gomez26 said:Can someone explain the actual mechanics behind account freezes? Is it even possible for an account to be locked if you’ve been perfectly current with your vendors and the IRS? Look, if a creditor has a claim against you, it is standard practice to attempt collection. If the funds aren't there, the account gets frozen. If the freeze fails to yield payment, then we move toward garnishment. If an institution abuses its power to freeze accounts, that needs a deep, rigorous investigation followed by real penalties. That is how a functioning state operates. Turning a blind eye to corporations that dodge their financial—or any other—obligations does nothing to build a better future. In these matters, speed is everything. A government must be measured, swift, strict, and above all, just. There should be no debt forgiveness, no bankruptcy settlements, and none of those legal gimmicks used to bail out former owners who drove a company into the ground. It is particularly egregious when laws allow that same ownership structure to remain intact after a "restructuring" or debt wipeout. Private corporate debt should never be socialized; owners must be held materially accountable for the failures of their businesses.

Don't take this personally, but your post reveals two things:
1. You have never actually run a business in a real-world economy like ours.
2. You lack a fundamental grasp of the subject matter.

The core issue here is that the account freeze system does more harm than good for both debtors and creditors alike. It is painfully obvious that this leads to mass business closures—triggering a domino effect that eventually cripples everyone involved.
On the consumer side, it also creates waves of people who can't participate effectively in society, which tanks consumer spending, and ultimately, everyone loses.

Frank Nelson2 said:Email is better, though I guess DMs are fine for now. 🙂

To keep us from drifting off-topic, let's talk about account freezes—it’s a disaster. They freeze your business accounts while simultaneously forcing you to run everything through them. A company gets hit with an invoice for raw materials or inventory, then they can't pay because their funds are locked up. If they try to pay some other way, it won't be recorded as a business expense, which just means they'll end up paying higher corporate taxes later. If they don't pay due to the freeze, they might as well close their doors entirely since they won't have anything left to sell. It isn't surprising that the economy has stalled when the system, whether intentionally or not, keeps sabotaging the very people driving it. It doesn't just kill the company being frozen; it hits the suppliers too, since they lose clients who are stuck without access to their own cash.

That is precisely my point—it's baffling that no one in this country has conducted a proper impact study on these freezes. Such an analysis would clearly show they cause far more harm than good. More importantly, when you look at the reality of the situation, these freezes actually distance the creditor from ever recovering what they're owed. It's a tragedy.

Maybe I am a bit of an idealist—I don't go as far as calling the administration traitors—but looking at their track record, they are nothing short of incompetent. That’s really the core issue with this country: everything eventually becomes a political football.

I’m not sure which sub this belongs in—if there’s already a thread on this, mods, please merge them.
http://wsj.com/articles/bank-account-freezes-destroying-small-business-growth

The real question is whether we've reached the breaking point where the seizure laws must be overhauled—specifically regarding account freezes—if we ever want to function as a coherent society again.

This systemic aggression against small businesses, contractors, and individuals—driven primarily by the IRS and public utilities, then fueled by big banks, and finally by private creditors—is effectively gutting what remains of our economy. It pushes private citizens into the welfare system, making everyone else foot the bill.

In my view—and if you look at how things work in more stable Western economies—freezing accounts does far more harm to the creditor than good, while almost certainly destroying the debtor. Is that actually the intended goal?

Consider this scenario:
Take a manufacturing firm that falls behind on its tax obligations this month. They might have been perfectly on track to pay next month, but they hit a temporary liquidity crunch because their cash was tied up in raw materials and payroll—especially with a 60-to-80-day production cycle.
The IRS swoops in and freezes their accounts, essentially backing the company into a corner. The government gets its money today, but the business will likely be shuttered by next month. Case closed.
That is just one example—there are countless others.

Isn't it high time we saw some actual, constructive legislative initiative instead of all this endless bureaucratic maneuvering?

Look, I don't doubt Linic's intentions—they're likely good—but the direction is fundamentally flawed. The economy isn't moving because fixed costs are suffocating us; they make us completely uncompetitive. Linic, there is only one way forward: aggressively scrap EVERY single parafiscal levy—from NBC fees to road tolls—implement massive hiring incentives, put intense pressure on local governments to slash utility burdens (or better yet, abolish them), and streamline all investor permitting...
A significant reduction in healthcare taxes and payroll contributions, paired with a radical slimming down of the federal bureaucracy.
Then, maybe you can actually hope for something.