Rick Kelo asks "Has Our Economy Gone Off the Rails?"

America was founded on the Classic Liberal principles of a limited federal government, with most decisions reserve to the states, and a list of clearly defined rights that could not be infringed.  Has the growth of the State as a proportion of America's economy taken us off track from the structure under which America enjoyed most of the growth our quality of life now rests upon?

These are important questions to consider as election season begins.  Rick Kelo has a few thoughts on this topic.  Rick Kelo is a small business owner, and a former economist and financial analyst.  Educated at West Point in his undergraduate studies, then later in Chicago, Rick Kelo's range of formal education in engineering, finance, and economics coupled with working experience in corporate finance, then later as a Chicago tax recruiter, gives him a unique perspective on these issues.

We should consider every election cycle if our government has gone "off the rails" from its original intent.  We now have a political class that rules under the guise of capitalism, but is increasingly fascist: it rules to the benefit of itself and its big business backers at the expense of most Americans (in their capacity as tax payers).  When a big business backer takes a loss, a normal part of the profit & loss system of capitalism, then the political class bails them out or declares that business "Too Big To Fail."

Meanwhile, remember to consider the plight of small businessmen like Rick Kelo, the President of TaxScout, Inc.  Small businesses, and most vulnerable of all - startups, now have an outside chance of making it big as that has become increasingly harder under the huge regime of government regulations in place.  Regulations exist to prop up the profits of existing big businesses at the expense of the entrepreneurs.  For example, it is obvious that under the Affordable Care Act no clever entrepreneur could ever navigate the regulatory hurdles necessary to enter the health insurance field.  Only the existing mega-insurers with departments of lawyers already on staff can figure out how to navigate it.

Richard Kelo

Rick Kelo on the Collapse of Venezuela's Co-Op Socialism

American Socialists like Bernie Sanders often claim they merely want workers to own part of the business.  Profit sharing, etc.  For that reason they often state publicly that they merely want a society made up of co-ops.  Of course these statements should be obvious lies since workers are free to buy stock in most of the large companies in this country already as they are publicly traded.

Rick Kelo

Still, we should examine co-op Socialism says Rick Kelo.  Kelo is a Classic Liberal thinker, and like most Classic Liberals, a Pacifist.  "Americans are already able to voluntarily and peacefully choose to go work at a co-op, found a co-op of their own, or buy stock in most large companies," says Richard Kelo.  "The fact many workers don't do those things is discounted by Socialists, but to the economist those are rational human actions.  People are very good at finding ways to buy things that are important to them.  If they don't prefer to own parts of the various major employers then they should be free to make that choice."

American Socialists had long championed Venezuela because the Venezuelan Constitution mandates worker co-operatives.  To Rick Kelo though these are nothing more than the proverbial Animal Farm, "Buying into a worker co-op in America is completely voluntary and peaceful.  A co-op in a Socialist economy isn't the same thing.  Workers are mandated to work at the co-op and have a portion of their pay seized to fund its ownership," Kelo points out.  "You can't really compare voluntary co-ops in capitalist economies with the forced co-ops in Socialist ones," he concludes.

Turns out Kelo is right.  In the summer of 2016 Venezuela began forcing the "worker-owners" in the nation's co-ops to work... at the barrel of a gun:

A new decree by Venezuela's government could make its citizens work on farms to tackle the country's severe food shortages.  That "effectively amounts to forced labor," according to Amnesty International, which derided the decree as "unlawful."  In a vaguely-worded decree, Venezuelan officials indicated that public and private sector employees could be forced to work in the country's fields for at least 60-day periods, which may be extended "if circumstances merit."
Source: CNN

Rick Kelo Discusses Religious Freedom

Every individual person makes their own moral decisions.  However, says Rick Kelo -  a West Point graduate, tax recruiter and social thinker - there are really two types of morality.

"There's the morality people use to govern their own individual choices as they go through life," says Richard Kelo.  "Then separately there's the morality that pertains to our interactions with other people.   The problem is when people try to take things they've settled on as personally moral and force other people to adopt their choices as the way we all interact with one another in society," he continues.

The Wedding Cake
Consider the now-famous example of the prejudice wedding cake baker who refuses to make cakes for same sex weddings.  What is the proper way to view this?

According to Kelo if we use force to compel the cake baker to make a cake, then we are imposing our own personal morality on him.  Instead, says Rick Kelo, "In the relations between people we have to remember to view our fellow man as someone to be persuaded.  To be reasoned with and convinced, but not to be coerced and forced to live his life by our personal code of morality."

In interactions between people we must remember not to steam-roll people who don't think like us.  The world is big enough for more than one wedding cake baker.

Rick Kelo

Rick Kelo on the 2 Ways to Organize Society

None of us is an island.  We all spend every waking moment of our lives as an individual, but also living in a society of individuals.  This is an unavoidable aspect of human existence.  So how should we best organize our interactions with one another?

Rick Kelo, a West Point graduate and outspoken liberal philosopher notes that there are ultimately only 2 ways to organize the economic activity of huge groups of people.  They're either:

1. The voluntary way, named Capitalism
2. The coercive way, named Socialism.

In the voluntary way, says Rick Kelo, consumers voluntarily choosing which entrepreneur most meets their needs.  The consumer decides which business owner will become rich and successful and which will fail. 

The only other way to organize society is by violence, coercion & force as the substitute of peaceful, voluntary cooperation.  For a government to seize private property and declare it their own as Venezuela did to their nation's oil or the USSR did to Russia's farms.

Rick Kelo

Rick Kelo Considers Economic Mobility

Rick Kelo is concerened that most Americans are unaware, due to the problem-inventing / fear-mongering from politicians who need something to promise to fix in order to get votes, that economic mobility in our country is very high.

Rick Kelo

Someone born into the lower class, which in economics refers to the bottom quintile of income distribution, is more likely to reach a higher income quintile than they are to remain in the lower class they were born into, notes Richard Kelo.

Rick Kelo also noted that many of the persistent & gripping effects of inter-generational poverty stem from interventions against the market.  The governmental welfare apparatus has become literally a machine for producing poor people & keeping them poor due to the fact it is loaded what public choice economists call 'perverse incentives.'  The government monopoly on schools is just as bad.  Ask yourself this: when you go into a poor neighborhood you will see many fancy cars.  You will not see any fancy schools.

The difference?

Cars are provided by markets, schools by government.

Rick Kelo - Market Socialism

Ever heard the term "Market Socialism"?  It is a method Socialists invented to try and show their system could work.  Under "market socialism" citizens are given rationing tickets to redeem for extra goods whenever an excess develops.  Socialists believe this will allow shop managers to adjust the number of rationing tickets needed to buy a certain good.  The premise behind this argument was that it would establish a functioning market where the availability of goods was governed by a market with supply & demand.'

Market Socialism in action in Venezuela

Socialist Venezuela is using this method right now.  In 2014 they began issuing food cards to be used for all grocery purchases.  Rick Kelo, an outspoken advocate of human freedom, has examined Socialist's claims that this system can actually implement a market economy inside a Socialist system.

He responds that rationing tickets don't replace money because in a free market economy money is earned by satisfying the needs of others.  Also prices are not set by trial and error, as in Market Socialism, but rather by entrepreneurs who own businesses anticipating the price.  The way entrepreneurs anticipate prices is by already knowing the cost of all of their inputs.  In a Socialist economy where the State owns all the means of production there is no market for raw materials and factories and all the things that go into making a finished good.  So the grocery store operator in Market Socialist Venezuela has no way to approximate his cost of goods sold to decide what price to set for the things on the shelf.

Richard Kelo - the real trickle down in politics

Ever heard the term "trickle down economics"?  It was a pejorative, kind of a high-brow insult, aimed at those during the Reagan administration who advocated reducing tax rates on the wealthy on the grounds eventually the benefit would "trickle down" to everyone.

However, the real theory of trickle down is what's advocated by Socialists. They claim that giving all money & resources to the control of a government will create a benefit that trickles down to the middle class and the poor.

Both are equally absurd says Rick Kelo, a public finance expert.  Instead of advocating policies aimed at redistributing private property from one group to another he suggests leaving people in peace.  Then they can voluntarily cooperate with one another.  An entrepreneur can invent a way to better people's lives, and if consumers feel they're made better off by purchasing it they will.

Rick Kelo

Rick Kelo - A Thought on Starvation

The state of nature is scarcity.  If any of us wandered off into the woods it would only take a few hours until our stomachs started complaining about the absence of our fellow man.  That's because we rely on doing the work we're the most productive at for a wage, then trading for things we produce less efficiently than specialists in other areas.  For most of us that includes buying food from experts at food production.

In the 20th century we saw numerous mass starvations that killed well into the tens of millions.  Many people haven't stopped to consider though that they all occurred in socialist countries.  The two most notable were in China & the USSR.  However, India also suffered chronic famines through much of the last century while it was socialist.  Somalia the same.


Where did starvation go extinct?  In the freest market, most capitalistic countries first.  The US and the other liberal western countries with relatively free markets & relatively free trade.

Capitalism has lifted more people out of poverty than any force in all of human history.

Rick Kelo, a father, a pacifist and an entrepeneur

Rick Kelo, an advocate of peaceful cooperation, has noticed this trend.  In countries where force is the central value in organizing society, like in all Socialist countries, the forces of supply and demand stop signaling how much food should be produced. But, as Rick Kelo also points out, in countries where the State doesn't obstruct people trading peacefully & voluntarily with one another society is able to pool the total knowledge of every single consumer, through prices, to signal how much of each thing should be produced.

Rick Kelo- Understanding Tax Rates on a Deeper Level

Rick Kelo is an Authoritative Economic Voice, Who Helps Others Understand How Ideas Have Shaped Our Modern World

Nothing quite sparks heated debate in the US as does the subject of taxes and what we should and shouldn't be paying. On the one hand, many see taxes as an important part of civilized society- providing the government with the money to spend on things we can all benefit on- schools, roads, hospitals and other aspects of infrastructure. For others, taxes are the government greedily deciding how our hard earned money should be spent, and taking the power into their own hands. In many ways it also explains the partisan political divide in the US, as many of these ideas fall on either side of the Republican/Democrat fault line.

Rick Kelo is a head tax adviser, and also prolific economic thinker. He is a member of the academic question and answers forum Quora.com, where he helps answer users questions about economics and explain them in context of the real world. A recent question posed was as to Why the US has the Highest Rate of Business Taxes in the World. IN a short and informative response, Rick Kelo answered as follows.

''Firstly there are Marginal Tax Rates, or the maximum amount on paper that a corporation may pay before deductions. Secondly comes the Effective Tax Rate (called ETR in taxation). This is the amount that a firm actually does pay after deductions. The other point I’d clarify is you say “Businesses.” Really in an American context we’re talking about C Corps, and in the context of the answer I am about to give you it is publicly traded C Corps. It is impossible to verify or truly know the tax rate of private companies. America's Effective Tax Rate, that our large corporations actually pay, is the second highest in the world. Our multinationals (MNCs) pay an average ETR of 30%. Only Japan is higher at 37%.''

Rick Kelo has seen himself become an important member of the Quora community, where he has been able to use it as a platform to share his ideas on classic liberal economics, and the importance of keeping old ideologies such as socialism at bay. His educated mind is one of many which is most welcome on forums such as Quora, which are helping shape the way people think in the age of the internet.

Rick Kelo – The Right Way to Handle Finances as a Small Business

For small businesses, and large businesses for that matter, there are few things more important that correctly managing finances. When just starting out, the scale of a business’ financial structure is typically such that the average individual can handle the organization and filing on their own. As the business grows, however, it becomes increasingly important to bring in a professional. This is for two reasons. The first reason is the sheer volume of tasks that must be handle as they relate to a company’s finances. This is not something that one single person has the time to do on his or her own. Second, as a company grows and becomes more complicated, so too do the taxes and other financial matters for that company. The consequences of incorrectly filing your taxes or making a mistake in the record keeping for your company can result in fines or even jail time. That is why for any business that has its feet underneath it and is starting to develop serious revenue and a serious client base, it is important to find an expert who can help you manage your assets.

According to recruiter profile, Rick Kelo (inChicago, IL) that is exactly the type of service that TaxScout brings to their clients. TaxScout is the largest tax professional placement service in the country. They offer the best candidates and continue to work with clients after placement in order to manage retention of the professionals they have placed. What TaxScout and Executive Recruiters such as Rick Kelo specialize in is helping bring together tax experts looking for employment with businesses that need financial support. Rick Kelo and other professionals help with this by creating company candidate databases to comply with OFCCP, promoting diversity, developing client bases, advising on retention policies, and advising on fair market compensation for the experts that they place.

One of the company’s biggest accomplishments is their impressive 70% retention rate. This means that roughly 70% of the financial experts they place in companies stay with that company in the long run, more than double that of other firms. This is because TaxScout continues to work with clients after placing them with a suitable company in order to manage the retention of the professionals they have placed.

For more information about Rick Kelo, TaxScout, or the services that they can provide to you or your business, visit his professional website, LinkedIn, or any of the various blogging platforms that publish his articles.

Rick Kelo – Bubbles

As a tax expert with a degree in economics, Rick Kelo knows (and has written more than one article) about economic bubbles. A bubble, to put it one way, occurs when any asset is traded for a price that far exceeds that item’s intrinsic value. A bubble is far from a new phenomenon; as a matter of fact, the first bubbles occurred in the 17^th century, well before real-time information on any asset was available.

Bubbles, of course, lead to economic crashes, which lead either to recessions (bad enough), or outright depressions (far worse). The British South Sea Bubble, which occurred in the years 1711 to 1720, gave us the term we use so often today. Previous bubbles (including the Dutch tulip bubble, which caused widespread economic devastation) were known as “manias”.

Some economists are of the opinion that a bubble cannot be identified before it begins, and thus, that a bubble cannot be prevented from starting. They believe that any measures taken to prevent the formation of a bubble will create a crisis; therefore, it is best to let a bubble form and burst – which, also, will cause a crisis. Not only that, but the subsequent crash can cause long-term economic problems, as shown by the Great Depression of the 1930s, and the housing bubble of earlier this century.

When a bubble has formed, owners of the assets that are the subject of the bubble have the tendency to spend more. Given that their assets are seriously overvalued, these owners feel that they are richer. The housing bubble is one such example. Then, when the bubble bursts, spending is cut and economic growth slows considerably.

Economists have yet to agree on what causes bubbles in the first place. One theory puts forth the idea that they are driven by sociological factors. Another theory is that excessive monetary liquidity creates banks to lend money under unfavorable terms. This, in turn, creates markets that are vulnerable to inflated asset prices driven by speculation. To quote Axel A. Weber, formerly the president of Deutsche Bundesbank, “The past has shown that an overly generous provision of liquidity in global financial markets in connection with a very low level of interest rates promotes the formation of asset-price bubbles.”

In other words, when assets are highly appreciated, economic bubbles tend to occur. When the bubble bursts, as it must, assets fall in price and confidence sinks, which may lead to a financial crisis.