Taxes and debt are also relevant issues for our current Scorpio hotspot. The GFC that appeared in full force by 2008 coincided with the arrival of the current Scorpio hotspot. Scorpio is a “contracting” sign, and as a general rule, periods associated with Scorpio will see the equivalent of the Biblical seven years of emaciated cows. The GFC achieved this admirably well. However as the Scorpio tempo increased from 2010 onwards, some additional serious financial calamities have appeared. By early 2010 a number of Eurozone countries were experiencing debt problems including Greece, Ireland, Portugal, Spain, and Belgium. Greece had to be bailed out in 2010, and later in the year Ireland found itself in the same situation with Portugal falling in line in early 2011. More countries with a debt crisis can be expected.
However the fringe European countries suffering debt crises pale to insignificance at the prospect of the USA going virtually bankrupt. This situation developed primarily due to the mainly conservative US government in the first decade in the 21st century lowering taxes at the same time as engaging in new and expensive wars and increasing government expenditure. It is one of the ongoing political ironies that the conservatives (Republicans) in the USA shout the loudest to reduce government expenditure and reduce taxes but whom when in office increase government debt the most. The American voting public seems unable to understand this nebulous aspect of their political culture. This is unlikely to change much as the prime sign for the USA is Pisces, and clarity is nearly always absent when Pisces is strong.
Laurence Kotlikoff in February 2011 states that the current state of finances in the USA is worse than Greece when it had to be bailed out in 2010 by the European Union. One of the reasons the USA is in such a parlous situation is that it has adopted ENRON styled accounting and for several decades has kept future social security liabilities “off the books”. To correct this situation, the US government needs to raise all federal taxes by two-thirds the current levels.[i] Not only are the rich in the USA currently paying reduced taxes, the tax take from corporations in the USA has plummeted in recent decades. By 2002 and 2003 it was reported that US companies were paying their lowest proportion of taxes since the Second World War. In the 1950s, corporations paid over 25% of all taxers collected in the US, which dropped to 20% in the 1960s. By the second half of the 1990s it dropped further to 11% and by 2002/3 corporate taxes provided a mere 6% of the US tax base. Apart from corporate tax reductions provided by the US government, major US corporations take undue advantage of various tax reduction schemes to minimise their taxes. This includes paying massive bonuses to their leaders and employees, much of which they claim as a tax deduction – but not shown as expenses in their financial accounts to their shareholders.[ii]
The prime zodiacal sign associated with both the USA and corporations is Pisces, which may explain why the USA deifies corporations and capitalism – and thus honouring them with paying far lower taxes as the years roll by. The Roman senators in the Roman Republic were equally short-sighted in their approach to tax. In the 2nd century BC they outlawed taxes. This is understandable as the Roman senators represented the same rich constituency as the American Republican Party, and people that have financially benefitted from society due to their enterprise or ingenuity, seem to dislike paying taxes to the same society they benefit from. This folly by the Roman Senators resulted in an ongoing lack of funds for government expenditure, especially for their armies. As a consequence, the Roman generals had to find other financial means to pay their soldiers, either from the booty of war or other means. This slowly tied the loyalty of the soldiers to their generals rather than the Roman state. It was only a little more than a century after this taxation change by the Roman senators that generals with their armies usurped the Roman Republic and moved to the dictatorial end of the political spectrum.
What will be the short, medium and long-term trend in the USA if corporate taxes are kept significantly below their real taxation responsibilities and the rich continue to pay minimal income taxes? It will not take long to discover. The next Cancer micro-age overflow (2015 – 2029) will bring out all of the dirty washing in the USA. Previous Cancer micro-age overflows experienced in America does not paint a pleasant picture.
The worse countries in the world for debt are basically the western nations of Europe, North America, Australia plus Japan.[iii] The richest countries in the world are accumulating the greatest debt indicating a significant fault line. From a rational point of view, the poorest countries should have the greatest debt in an attempt to try and catch up with the developed nations. Ultimately debt means bringing forward expenditure than normally would have to wait. Bringing forward expenditure also means bringing forward the associated pollution. The mainly western-developed nations are behaving like the old medieval aristocracy, demanding a far higher material quality of life and lording over their serfs (Third World countries) – but throwing them some crumbs from time to time. We live in the delusion of a progressively democratising world, but in reality, democratic countries do not behave as equals on the world stage.
As an example of the relationship of (Scorpio) debt to economic well-being, there were only two years in recent history when the US household debt was the same as the GDP – in 1929 and 2007. The first coincided with the Great Depression, and the second with the GFC. In response, Columbia professor David Beim stated that the economic problem may be blamed on the banks and financial institutions, but the real culprit is the general public. People are living beyond their means and are borrowing far too much money to support their dreams.[iv]
However it is the banks and financial institutions that are getting the bulk of the bad press. From the astrological perspective this is understandable as banks are ruled by Taurus, and Taurus is opposite Scorpio. In a Scorpio period Taurus banks will be in 7th house mode. They will either be in attack mode or under attack. With some significant bank failures and problems around the world and the perception banks resorted to exotic financial instruments that caused the banking collapse associated with the GFC, the status of banks have plummeted in the last few years. This is entirely in accord with the current Scorpio hotspot.
As of May 2011 many smaller banks continue to fail each month in the USA.[v] It is instructive that the cause of bank failures for the most part relate to the massive drop in real estate prices associated with questionable loans linked to questionable collateralized debt financial instruments. Everything to do with real estate is associated with Cancer, and it must be remembered that the current Scorpio hotspot is the Scorpio micro-age decan and overflow (2005–15) within the Cancer micro-age (2000-15). Scorpio debt is the problem sitting within the context of the Cancer real estate market shake-down.
The result of over-borrowing is default and bankruptcy for individuals, businesses, banks and countries. The fact that a number of European nations plus the USA are currently experiencing the downside problem associated with debt is due to the previous over-reliance upon excessive debt. Debt is one of the scourges of the modern world, and may be one of the Four Horseman of the Modern Apocalypse. If the world was run by a world government that acted rationally, permanent steps would be put in place to counter debt in the same way steps have been put in place in many nations to limit other scourges such as cigarette smoking and AIDS. This is not the case so whatever patchwork approach is taken by governments to offset mounting debt is unlikely to prove effective in the short term at least. There remains four more years until 2015 when excessive debt will cause further problems.
A number of conservative governments and other governments that have fallen foul of their debt have significantly changed the ratio of their taxation to spending levels. For conservative governments they mainly try and keep taxes low and reduce services. For other debt-ridden countries, they not only reduce services but must increase taxes. Taxes will be in the march in a Scorpio period. This is the source of social unrest in some countries like Greece and Spain where the populace are venting their displeasure at their falling collective wealth. Taurean wealth will always be in detriment in a Scorpio period.
The banking and GFC are further convincing evidence that the world is currently under the influence of Scorpio – the sign of our times. Taxes will continue to be an issue and the rich plus banks will be aggressive in trying to defend their turf. This is a time of seven-emaciated-cows so temporarily at least, the world must tighten its belt, reduce its consumption, pay more taxes and therefore exist with less money and wealth – all the hallmarks of Scorpio.
[i] Laurence Kotlikoff, “America is bankrupt”, Feb 11th 2011, http://www.economist.com/economics/by-invitation/guest-contributions/america_bankrupt, downloaded 22 April 2010
[ii] Robert McIntyre and T.D. Coo Nguyen, “The Gap Between Statutory and Real Corporate Tax Rates”, First published by the Multinational Monitor, Vol 25, No. 11, http://reclaimdemocracy.org/corporate_welfare/real_tax_rates_plummet.php, downloaded 22 April 2011
[iii] “World debt comparison – The global debt clock”, http://www.economist.com/content/global_debt_clock?page=6 , downloaded 23 april 2011
[iv] Household Debt Vs. GDP, http://www.npr.org/blogs/money/2009/02/household_debt_vs_gdp.html , downloaded23 April 2011
[v] “Bank Failures in Brief”, FDIC (Federal Deposit Insurance Corporation) http://www.fdic.gov/bank/historical/bank/index.html downloaded 28 May 2011