Reading, Writing, & Helping

Sep 1st

Brian Clark highlights various levels of reading, and how many bloggers fail to go beyond scratching the surface.

Improved data visualization technologies are making it easier to transfer knowledge.

I few posts back I mentioned that Amazon's Mechanical Turk would be good for some SEO processes. It looks like people are already using it to spam social media. As sock puppets rise up many of the broad/general social media sites will get polluted by increasing amounts of spam.

My latest column on SEL was about how you have to give your SEO as much information as possible if you want them to solve your problems in an efficient manner, equating a broken website to a sick patient.

New Killer Keyword Research Ebook!

Aug 29th

I recently worked with the fine folks at Wordtracker to create an ebook titled 50 Kick-Ass Keyword Strategies. Coming up with 50 unique and creative keyword research ideas was a bit more work than I thought it would be, but it was great fun to work with the Wordtracker crew - the feedback they gave to improve the content and the formatting they did were phenomenal.

So far the guide has been getting pretty good feedback

They quietly announced the launch to some of their newsletter subscribers, and I have been getting bombarded with emails asking about the ebook. If you are interested in buying it, the $12 off discount is here, but you have to get it by August 31st, because after that date the price goes from $27 to $39.

Why Alert Competitors to Your SEO Strategy?

Aug 28th

Recently a SEO working for a lead generation network sent me a letter in the mail alerting me that I could improve my website by linking to their site. They mention some of the large brands they send leads to and state that the link to their site from my site would improve my site's credibility, user experience, and offer our site visitors security since their lead generation form was secure. :)

Where this letter went astray was

  • recommending a really aggressive and spammy long anchor text (they should have just gave me an easy short option and perhaps a link to a page on their site with linking FAQs and banners)
  • for the most part their site is just a lead generation form (so they give me little real reason to link at it)
  • in the tip where they tell me the transaction is secure they tell me the third party provider (so if I was going to link I might link to the 3rd party provider rather than through their thin affiliate site)
  • they included a business card for their SEO firm in their letter (if I didn't know what SEO is, then that might make me research it)
  • they sent it to me (if you know the field of SEO well, you probably have heard my name once or twice, and would not want me shadowing your new site's link building efforts on my older and more authoritative directly competing website)

As a result of the letter they sent out a few weeks ago it looks like the strategy yielded 0 organic links, but I found a couple easy link sources that I have not thought of in the past. I will spend some time further researching that SEO to see what other easy link sources he can find for me. :)

Hidden Risks of Promoting Your Marketing as "SEO"

If you call something marketing or promotion then it is seen as clean and above board. But as soon as you attach the SEO label then eyebrows raise, someone talks about it, and it gets nuked. It gets nuked because if the search engine does not do so then people assume it is a fair strategy, and the search engines have Google has to make examples out of the sites or many people will start doing it.

And it doesn't have to be that way, as big brands benefit from semantic differences which should be used in their everyday marketing. Smaller brands can also enjoy the same benefits by avoiding the SEO discussion.

Findlaw recently came under scrutiny for trying to sell links to local law firms. Make the pitch to a few thousand lawyers and only one of them has to say no and out you (as a public relations and link building strategy). That discussion works its way into the SEO field and trouble happens. They may only get an aesthetic toolbar PageRank reduction. But they could have simply avoided the risks by talking about boosting exposure rather than SEO.

Free SEO Tips for Google Search Suggest

Aug 26th

Google announced that over the next week they are going to implement their Google Suggest search suggestion feature on Google.com. This change will help searchers find popular keywords that other searchers recently searched for.

Short Term Influence on Search

When this search suggest change is coupled with the recent launch of automatic matching and the new quality score update it may consolidate PPC competition against a smaller set of core industry keywords. Some outlier keywords, like misspelled terms, are going to be much harder to build a traffic stream from.

This will also likely have the effect of focusing organic search attention on a smaller set of well defined queries. And the extra competition in the PPC space will drive yet more competitors to adopt SEO practices. But as an SEO smarter than 99.9% of other web publishers, you have some profitable drafting opportunities you can use to build a profitable search traffic stream. :)

SEO Drafting Tips

  1. Search Query Drafting: If you can create a brand that starts with and industry keyword and drive search volume on it then your brand can show up for some people looking for the broader topic. For example, a webmaster may not have enough PageRank/link authority to rank for seo, but if they can create enough hype around their brand then maybe people search for it and their brand related search query shows up as a suggestion around the broader search queries. This is something that should also be taken into consideration when coming up with official names and page titles for leading resource oriented linkbaits.
  2. Brand Drafting: If SEO Book is a decently strong brand and a fairly generic keyword, and SEO Books is the second most popular term suggested right below it then you might be able to pick up some of that search volume by ranking at or near the top for that alternate version. An April Hitwise blog post showed that in the US nearly 15% of brand related queries were intercepted by third part websites, and that was *before* Google launched search suggest directly on Google.com.
  3. Brand Coupon/Discount Drafting: This is an extension of the above type of drafting, but rather than creating a compilation of sorts you focus on getting an affiliate commission for offering consumers a discount on the core brand. Many consumers will be reminded that there are coupons, discounts, promo codes, and reviews to find and read through when reviewing popular brands.
  4. Media Drafting: This technology is already live on Youtube, so Youtube presents 4 ways to draft popular media.
  • create a video optimized for a phrase that is already popular on YouTube
  • create a video optimized for a phrase where you think the video has a good chance of ranking high in Google results
  • create a video that has a title similar to other popular YouTube content that is watched by hundreds of thousands or millions of people
  • create a relevant video that is a video reply to a video that is already well received

Long Term Influence on Search

  • For websites and businesses that have no intent of building a real brand and intend to run primarily as an organic search arbitrage player the significance of domain name may be lowered significantly.
  • As people get more acclimated with using search to navigate the web (as many people already do) then some brands and domain names that seemed too long and not viable may become viable marketing platforms.
  • Conversely, short acronyms may lose some of their value as people become acclimated to having the search engine help complete their search queries.

Your Turn

How do you see search suggestion influencing how we search and how we write?

The Secret Book/Movie/DVD Scam: Blindly Seeking Material Wealth = Tragic Failure

Aug 26th

A lot of wealth consultants and self help snake oil hucksters, the type who publish books and movies like Rhonda Byrne's The Secret, would like you to believe that if you believe something it will come true. This Amazon.com review sums up The Secret book/DVD nicely:

Byrne's book is problematic on many levels. On it's face, it's a manipulative marketing tool meant to flatter, confuse and deceive. It's also pseudoscience at its best, the last thing we need to encourage in an increasingly technological world which requires healthy skepticism and critical thought. Most damaging, though, is how the book perverts reality by encouraging people to equate a positive outlook on life with a childish, idiotic narcissism.

Negative thoughts can be a roadblock to growth. And positive thoughts do bring positive influences into your life, but material wealth is hollow, and it never makes you happy if you judge yourself based on it. Unless you print and control the money supply, someone else is richer than you are, and they will systematically eat your wealth via inflation.

In the last 20 years people in the UK became twice as rich but are no happier. Why?

Many of the pyramid scheme marketers will teach that you simply need to visualize yourself owning something and you will get whatever you wish for. They do so because if you have enough intellectual sloth and/or greed to believe that, they know they can keep selling you more worthless crap at higher price points. I only find it fitting that the people who created The Secret, selling the garbage story of limitless wealth, are stuck in legal turmoil. Hey, they must have wanted to waste 5% or 10% or 20% of their earnings on legal fees. They simply closed their eyes, thought of spending lots of money on lawyers, and the lawsuits magically manifested. :) :) :)

The Secret is drivel, The Secret is slimy, and The Secret is a scam. If The Secret teaches you anything, it should be that if you work with greedy people willing to lie to make a dollar, they will eventually show you that they are sleazy and morally deplorable on other fronts as well. Just give them time to manifest that experience for you.

Almost everyone I have known who has become successful online has worked 12+ hour days, learned for years, took big risks, and had a few lucky breaks. By networking, learning your market, investing, and being around for a while, you put yourself in position to have a big lucky break...that lucky opportunity doesn't manifest itself when you close your eyes and think of sports cars. It is hard to daydream your way to happiness and success.

Planet Earth - like the Cosmos - is beautiful, rich, deep, and diverse. But our little planet is not an infinite resource and is not infinite garbage can.

New Google SERP Changes

Aug 23rd

Google has been changing the code used to display their search results a number of times over the past couple days. We recently updated SEO for Firefox and Rank Checker. Both should work as of now, and if any more SERP changes happen we will try to update the extensions as soon as possible.

If you need to update these tools you can do so within the Firefox browser by clicking on Tools in the top Firefox menu, then from the Tools menu click on Add-ons. This will pop up the Add-ons / extensions window. At the bottom of this window there is a Find Updates button you can click. That will bring in the new updates and then when you re-start the browser the extensions should be fully functional again.

Video Content Tips

Aug 20th

I love writing, especially when compared to speaking. If I make a spelling error or need to pause and think...no problem, but with video I notice my awkward pauses and voice inflections and cringe, and then I worry about sounding like the Fox weatherman with coprolalia

I recently came across Chris Martenson's Crash Course and appreciated the clarity of the message and presentation, which got me to thinking I should try to get better with video stuff.

I saw Brian Clark mention Web Video University. Andy Jenkins is quite good with video stuff too. Have you done much audio and video recording? What are some of your favorite tips, and what courses/books/products/etc. would you recommend?

Anyone Doing Political SEO?

Aug 20th

Most the attempts at political SEO I have seen this year have been grassroots GoogleBombing or half-thought out campaigns asking fans to comment online (and the occasional robotic sounding request for viral content creation).

Obama was estimated to have spent over $2 million on Google ads, and Google political ad man Peter Greenberger claims that limited and inconsistent search ad spend hurt Hillary Clinton, going so far as saying

The McCain campaign was the savviest among the Republican presidential primary campaigns. We think it's not a coincidence that the two savviest primary campaigns with Google are the winning ones.

How well rounded was their search engine marketing? How savvy were they with Google? Were they doing organic search optimization as well? Does anyone know a SEO working for one of their teams? Are any SEOs working for other political candidates like the Senators or members of the House of Representatives?

Decisively Average

Aug 18th


Seth Godin recently published a post about the dead zone between being real and being polished: "It's the banal stuff in the middle that people don't read. And yet, 95% of what I see is precisely in the dead spot of the middle zone. "

I firmly try to stay in the "real" category (largely because I can't tolerate the polished up fake stuff), though someone sent me an anonymous email today telling me I need to polish it up

You know a lot, but

  • it needs to be made far simpler for laymen
  • cut back on the jargon
  • skip the rare profanity. It’s is a real turn off for traditional people
  • you could take a more professional picture

If I tried to take their advice I would end up with a watered down brand in the dead zone. Years ago one of my mentors gave me this advice

I think the best brands, the best sites have a large portion of their founders personality in them. Never be afraid to be yourself, after all there are 1/2 billion people on the www, not all of them have to agree with you. Concentrate on the ones that share your views, concentrate on making their experience the very best it can be, the rest forget them.

Or to put it another way, the best sites say - this is what we do, this is how we do it, if you don't like it go somewhere else.

Interviews & News

Aug 14th

I got mentioned in the media 3 or 4 times last week and just finished my last interview (at least for a while). It is hard when you get used to doing interviews with friends or talking to the media because it is easy to be unprepared for the other. With reporters you have to be guarded because they often aim for a misquote because that sounds more interesting, whereas you can be really open with friends.

Anita Campbell recently interviewed me about SEO and business stuff on the Open Forum, and Augusto Ellacuriaga interviewed me about SEO on his Spanish SEO blog.

Kim Krause Berg recently interviewed Sugarrae.

In Leonard Klaatu's article about Bassackwards Business Model he mentioned me a bunch, but did not interview me...he didn't need to though as I think he understood my philosophy and strategy, perhaps better than I do. :)

On Search Engine Land I wrote tips on how to rank a new site quickly.

If you are going to SES please support Todd Malicoat's IM Charity Party on the 18th. I won't be attending SES, but I should be at the IM Charity Party for an hour or two.

David Mihm did a great rundown of SMX local and mobile.

Microsoft Live Search upgraded their webmaster tools, so if you want to dig into details but were afraid to give Google any more data this is a great opportunity. Rand recently interviewed Live's Nathan Buggia.

Amazon's Mechanical Turk fully launched. It has to be good for a lot of creative publishing ideas...the most obvious are spamming opportunities, but I have not tested the upper limit of quality yet. Have you?

Google is showing more data about when and how they customize and personalize search results...claiming greater transparency. Meanwhile, they have begun blocking some automated rank checkers and sending bad data to users of their API.

Zappos is practicing the ugly anti-marketing art of line extension, by selling laptops. Did you know that before ketchup Heinz was a leader in the pickles market?

Emotionally Engage or Enrage

Aug 12th

I just got done talking with a pretty sharp reporter about some SEO stuff. He had done far more research than most reporters I talk to, but still had one big misconception about the field of SEO...thinking it was largely about mechanical processes, hidden text, and other such tricks.

Market research, site structure, and on page optimization are important. Doing them well can double or triple the earnings of a site, but when you get into the big fields where people are deeply passionate or interested links are needed to win. And those links are often a reflection of our emotions.

When you look at your site do you find anything that is emotionally engaging? enraging?

As the web gets more efficient and search engines gather more data, those who evoke emotional responses will keep gaining marketshare while bland webmasters fall quietly into the abyss.

Buying & Selling Websites

On Sitepoint Clinton Lee wrote a 6 page high quality web site valuation guide.

The New York Times recently published a great article about flipping websites, quoting my buddy Peter Davis.

Shane Pike recently blogged about selling one of his sites to Internet Brands. The site he sold was the one that let him quit his job. I gave him some tips on how to build traffic and increase monetization during a 15 minute chat at Elite Retreat in December of 2006. He quickly took my advice to heart and is a richer man for it. Here is his revenue graph from that site

But where he really made a killing was when he found investment bankers to help him sell on a nice multiple of that

If you believe your site could sell for more than $100,000, you’re throwing money away if you don’t use an experienced broker or investment banking firm to help you sell it. Because they’re much more adept than you at running an efficient process, finding potential buyers, and maximizing the bids from those buyers, they make up their fee many times over.

For example, this whole process started when I received an unsolicited bid for the site. Before all was said and done, though, my representatives had secured not just one, but two final bids that were ten times that initial offer. I couldn’t have gotten half that on my own.

Paying Competitors to Beat You & Steal Marketshare

Aug 9th

Because of the low cost of online distribution a company can quickly grow from being one of your affiliates, to one of your leading sales channels, to being the leading competitor. And once they grow into a destination you can't just cut them off without hurting your customers or your brand, as Ryanair will soon find out.

The strategy of starting off with a harmless consumer focused service that can spread far and wide is what allowed Google to create a system where its leading competitors paid Google to market the Google brand across the leading web properties. It is the same set up that benefits new bloggers...most companies don't see them as competitors until after they dominate the market.

In a recent interview Microsoft's Brad Goldberg said:

Today, if you look at search behavior, search actually isn’t good around verticals. In many respects it is not in the economic interest of a lot of vertical sites to expose more and more of their content to search engines because then they risk being aggregated in terms of traffic.

At some point Google will reach a logical upper limit. Google OneBox is encroaching on many large verticals, and Google merchant search is not far behind.

At the other end of the spectrum, many marketing companies offer to help you get traffic cheaper than you can get it from Google, but only at the expense of creating competition subsidized by your own pocketbook! Years ago Article Insider was selling traffic for pennies a click, but you had to buy years worth of clicks upfront, and then when they published your content the clicks you were buying were below the fold while they placed Google AdSense ads above the fold - so if you wanted real exposure you were stuck paying Google anyhow. More recently John Andrews pointed out a new Marchex strategy where publishers pay Marchex to develop a domain name that offers them low cost traffic, at least temporarily.

By “partnering” with Marchex, these small business men have handed over a portion of their web presence to a company that has invested heavily in their own market. Marchex acquired — and prepped for local business success — a collection of domains like DentalCareIssaquah.com. Today that domain is offered to this dental practice, but tomorrow when they stop paying Marchex’s preferred rate, that domain will indeed be offered to the next bidder. Thanks to Issaqua Dental’s continuing investment in Marchex, that hyperlocal domain owned by Marches has increasing asset value in that local market. Clearly Marchex is a competitor. What a great business strategy! Compete with local small businesses while marketing yourself as their partner, collecting a share of their revenues!

If you are going to make a big online marketing investment make sure your site has reached the point of diminishing returns before looking elsewhere. And make sure that when you look elsewhere you are not diminishing your longterm returns by subsidizing a new market competitor.

Social Media Free For All Pages

Aug 9th

It is fun to watch Tamar Weinberg and John Andrews write about social media. Largely because they are both firm in their beliefs, and they believe polar opposites. Tamar's piece covering the definition of social media marketers is uplifting and paints social media as friendships to be won rather than games to be played and people to be fooled. But bots and ad networks are amoral, and they control the production of much of the free content.

John's view of social media is a bit more cynical - highlighting quotes like this one:

In an age when most major media outlets are providing outrage-of-the-hour content, one should not be surprised that the community built around that is also comprised of illogical, emotionally charged drivel flavored with a smattering of generally useless regurgitated trivia posing as genuine information.

Digg is full of fake profiles, and so is MySpace. Early promoters of social media ask if it is becoming a vast wasteland. But at the core the questions nobody is asking are

Some animals are smart, but assuming a user is real why would they spend hours a day on a general purpose social media site unless they were getting something out of it? Entertainment has value, but trading votes gets old on day #2 (at the latest)! How low must a person value their time (or how poor must their self image and identity be) for them to spend so much time on sites painted by a collage of spam? If they are poor they are probably easy to buy off, so social media is just another way to buy exposure.

The news companies are fighting back against the free content by turning newspapers into something Jerry Springer would write, with a few advertorials sprinkled in to help offset lower ad revenues. A recent survey revealed "Nearly one in five (19 percent) of senior marketers admit their organizations bought ads on a news site in exchange for a news story."

It is hard to create a destination, become an icon, or build a brand if you are stuck on a large anonymous network. And spending too much time on such a network can warp your perception of reality by showing you the nasty side of anonymity. Add in a bit of desperate attention whoring coupled with endless reams of free recycled content and you have the perfect storm for creating The Tragedy of the Commons.

At best most large social media sites are an Amway-like pyramid scheme. Sure you can count uniques, but what's the point? Social media sites are a transitory vehicle used by newbies hoping to gain status and recognition, while professionals use them for marketing and link generation. Those who realize the game rarely waste time on social media sites beyond satisfying the criteria needed to manipulate them to achieve their goals.

The only difference between most social media sites and a traditional free for all page is votes. As social network spamming programs get cheaper and bots get smarter look for that difference to narrow.

Which is Worth More: SEO.ME or SEO.CO.NZ?

Aug 7th

When the .ME landrush began I thought it would be possible to get a couple fun names like SEO.ME and QUIZ.ME for about $200 each. Boy was I wrong! Look at these .ME domain auction prices...

I have seen far better .info (and sometimes .net and .org) names with far more resonance go for prices far below these prices. Many international CCTLD names are dirt cheap. It is hard to find an online market more saturated than the search engine optimization field, and yet SEO.CO.NZ is already well ranked in Google New Zealand for SEO while having a buy it now price of $10,000 NZD, which amounts to $7,251.78 USD.

The .ME prices bode well for strong launches of future extensions like .web and .blog...but most new extensions will be at best marginal successes, especially given that Google is not likely to trust most of them.

Google Insights for Search

Google recently added search volume estimates to their keyword tool. They also recently launched Google Trends, Google Hot Trends, Google Trends for Websites, and the Google Ad Planner. And now Google hits the competitive research market with yet another product - Google Insights for Search

Insights for Search shows the following search data

  • relative keyword search trends for keywords (and A/B comparisons between keywords)
  • top related keywords and hottest rising related keywords
  • category based top keywords and category based hottest rising searches (and overall top 10 rising searches)
  • category based keyword search volume trends, and the relative growth of a keyword compared to its category
  • countries, states, and cities where a keyword query is popular
  • you can also mash up many data points, like celebrity searches in New York in the last 30 days

Keywords are weighted such that their top volume day is anchored at 100, and other days are represented as a relative percentage of that search volume.

Just like their Google Trends tool, by default Google Insights for Search defaults to the broad matched version of a keyword, so a word like credit will show more volume than credit cards, even though credit cards gets more search volume (because terms like credit cards and credit reports count as search volume for the word credit). Credit vs credit cards pictured below:

This type of tool can also be used to see how related some generic concepts are to more specific related concepts, and how much news coverage and marketplace changes move the relative importance of different keywords in a marketplace. Public relations experts will be able to use graphs like the following to say "hey our brand is catching up with the market leader."

Rather than brand lift and PR lift being an abstract concept, we can compare brands in real time and see which markets resonate with our brands and marketing. When marketing is working *really* well you can consider boosting early success in the most receptive markets via offline advertising, social interaction, and live events. If I wanted to hold an offline seminar guess what state is most receptive to my brand? The one I live in. That's pretty cool. :)

And the problem with such tools? It is easy for me to lose days or weeks playing with them. What are your favorite search data tools? What creative ways do you use them?

Robots.txt vs Rel=Nofollow vs Meta Robots Nofollow

Aug 6th

I was just fixing up our Robots.txt tutorial today, and figured that I should blog this as well. From Eric Enge's interview of Matt Cutts I created the following chart. Please note that Matt did not say they are more likely to ban you for using rel=nofollow, but they have on multiple occasions stated that they treat issues differently if they think it was an accident done by an ignorant person or a malicious attempt to spam their search engine by a known SEO (in language that is more rosy than what I just wrote).

Crawled by Googlebot?
Appears in Index?
Consumes PageRank
Risks? Waste?
robots.txt no If document is linked to, it may appear URL only, or with data from links or trusted third party data sources like the ODP yes

People can look at your robots.txt file to see what content you do not want indexed. Many new launches are discovered by people watching for changes in a robots.txt file.

Using wildcards incorrectly can be expensive!

robots meta noindex tag yes no yes, but can pass on much of its PageRank by linking to other pages

Links on a noindex page are still crawled by search spiders even if the page does not appear in the search results (unless they are used in conjunction with nofollow on that page).

Page using robots meta nofollow (1 row below) in conjunction with noindex do accumulate PageRank, but do not pass it on to other pages.

robots meta nofollow tag destination page only crawled if linked to from other documents destination page only appears if linked to from other documents no, PageRank not passed to destination If you are pushing significant PageRank into a page and do not allow PageRank to flow out from that page you may waste significant link equity.
link rel=nofollow destination page only crawled if linked to from other documents destination page only appears if linked to from other documents no, PageRank not passed to destination If you are doing something borderline spammy and are using nofollow on internal links to sculpt PageRank then you look more like an SEO and are more likely to be penalized by a Google engineer for "search spam"

If you want to download the chart as an image here you go http://www.seobook.com/images/robotstxtgrid.png

Thirty Day Challenge: Why Must Traditional Email List Internet Marketers be so Sleazy?

I recently saw Ed Dale teaching thousands of Internet marketing newbies how to use Market Samurai, a paid tool promoted through their free course. Which, it turns out, is another good example of why many free information sources are worth less than they cost.

As their B case video (showing the free alternative that justifies the month-long sales pitch for various products pitched as free help) they used a poorly configured version of SEO for Firefox to make it look worse than what they were trying to sell. The video reviewing SEO for Firefox was given the title of SEO Competition The Old Way, and concluded that for SEO for Firefox

I am sorta hoping that you never have to use this, but if you do, it is there, and it is available.

Thanks for the faux recommendation. Pretty sleazy stuff there Ed Dale. Thumbs down for you.

For anyone who wants to see how SEO for Firefox actually works with all its features enabled, please check out the following video...and compare what you see to what you saw in that other video (while noting that I took half the time to show a much more comprehensive picture of the actual features).

Populism to Kill the US Economy?

Aug 5th

Yesterday I finished a monologue by Manuel F. Ayau titled Not a Zero-Sum Game in which he explains the basis of economics with common sense passages like:

Understanding that in a market economy a person can only get rich by enriching others torpedoes claims to the moral high ground of those who propose that government redistribution of wealth is a means to alleviate poverty.

and

[In a market economy], one cannot "make a fortune" at the expense of others, but only by offering others a better deal and, thereby, making them richer.

On some levels some type of wealth is built through fraud (see the mortgage industry over the past 5 years), cronyism (see Iraq), and other nefarious means, but on average most entrepreneurs create wealth through efficiency improvements. Google makes so much money because they make advertising more targeted and automated. I do well because I help people get more exposure on Google at a rate much cheaper than what it costs to buy that traffic directly from Google.

You can take wealth creation and distribution as a concept and move it away from our own industries to everyday trade and consumption. For example, I had an eye appointment and just got my prescription today. Rather than paying retail in the store I decided to hunt online to save money. And that worked out well because

  • I found a discounter
  • that offered free shipping on a bulk purchase
  • there was no sales tax
  • I ordered enough that I got a $60 rebate coupon from the manufacturer
  • I found an affiliate link for a coupon that got me another 15% off my order (before the $60 rebate)

The net result is that I saved hundreds of dollars today due to the efforts of the above people. But if the government takes away their incentive to take risks in the hopes of profit (through higher taxes), then those cost savings to me as a consumer disappear. Thus I pay more to get less. Worse yet, as government spending increases it drives up the costs in most marketplaces it touches because it is not as efficient as individuals are.

Brian Provost highlighted a WSJ article about Obama's tax plan.

As ugly as that chart is, the situation is even uglier than that. If I am only taking home ~ 37% of my earnings and many of my customers are only getting 37% I get hit both directly and indirectly...I get a smaller piece of a smaller piece.

The WSJ article also highlights 2 more frighting issues

While Mr. Obama also proposes an alternative minimum tax (AMT) patch, he could instead wind up with the permanent abolition plan for the AMT proposed by the Ways and Means Committee Chairman Charlie Rangel (D., N.Y.) -- a 4.6% additional hike in the marginal rate with no deductibility of state income taxes. Marginal tax rates would then approach 70%, levels not seen since the 1970s and among the highest in the world.

And the article also states that Obama is a protectionist who dislikes free international trade.

Mr. Obama has also opposed other important free-trade agreements, including those with Colombia, South Korea and Central America. He has spoken eloquently about America's responsibility to help alleviate global poverty -- even to the point of saying it would help defeat terrorism -- but he has yet to endorse, let alone forcefully advocate, the single most potent policy for doing so: a successful completion of the Doha round of global trade liberalization. Worse yet, he wants to put restrictions into trade treaties that would damage the ability of poor countries to compete.

All trade is from individual to individual. When intermediaries exist it is typically because they lower cost and/or make trade more efficient (like the use of cash does). If we block foreign trade we increase the cost of goods and services to our poor because they will not be able to benefit from the division of labor driven by lower overseas labor costs. Read Underdeveloping Indiana to see how absurd blocking free trade is as an international economic strategy.

The true reasons the US economy is so screwed up right now is because the government is already too big, we use our military in an attempt to force our view of the world onto other countries (economically inefficient and ineffective), and the average American feels entitled to consume more than they can afford while suffering from uncompromising intellectual sloth.

  • I can't vote for McCain because I would feel like I was promoting the spread of unjust wars, torture, and murder.
  • But I can't really vote for Obama if he wants to kill both my incentive to work and the economy.
  • I wish Ron Paul would have been nominated. :(

If you live in the United States, at what point would a tax hike be high enough to make you work less or move overseas? A 65% to 70% tax rate would probably do it for me!

[Update: a reader pointed out a couple other tax charts that did not look as scary as the above charts. You would think you could trust the WSJ, but I probably should have done more research before posting this...too often I let emotions get the best of me.]






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