Wednesday, April 01, 2009

Washington solutions of more money for more government, more power for politicians, more debt, and more bureaucrats will not lead to real growth in jobs and prosperity.

We need a clear and decisive alternative that creates jobs and rewards work, saving, and investment.

1. Payroll Tax Stimulus. With a temporary new tax credit to offset 50% of the payroll tax, every small business would have more money, and all Americans would take home more of what they earn.

How about eliminating payroll taxes? There has been a call to place a temporary moratorium on payroll taxes for a period of three to six months. 

2. Real Middle-Income Tax Relief. Reduce the marginal tax rate of 25% down to 15%, in effect establishing a flat-rate tax of 15% for close to 9 out of 10 American workers.

See my comment above, except eliminating payroll taxes permanently. Go here for more information. 

3. Reduce the Business Tax Rate. Match Ireland’s rate of 12.5% to keep more jobs in America.

See above commentGo herefor more information. 

4. Homeowner’s Assistance. Provide tax credit incentives to responsible home buyers so they can keep their homes.

See above commentGo here for more information. 

5. Control Spending So We Can Move to a Balanced Budget. This begins with eliminating Congressional earmarks and wasteful pork-barrel spending.

See above commentGo here for more information. 

6. No State Aid Without Protection From Fraud. Require state governments to adopt anti-fraud and anti-theft policies before giving them more money. 

See above commentGo here for more information. 

7. More American Energy Now. Explore for more American oil and gas and invest in affordable energy for the future, including clean coal, ethanol, nuclear power and renewable fuels.

See above commentGo here for more information. 

8. Abolish Taxes on Capital Gains. Match China, Singapore and many other competitors. More investment in America means more jobs in America. 

See above commentGo here for more information. 

9. Protect the Rights of American Workers. We must protect a worker’s right to decide by secret ballot whether to join a union, and the worker’s right to freely negotiate. Forced unionism will kill jobs in America at a time when we can’t afford to lose them.

See above commentGo here for more information. 

10. Replace Sarbanes-Oxley. This failed law is crippling entrepreneurial startups. Replace it with affordable rules that help create jobs, not destroy them.

See above commentGo here for more information. 

11. Abolish the Death Tax. Americans should work for their families, not for Washington.

See above commentGo here for more information.  

12. Invest in Energy and Transportation Infrastructure. This includes a new, expanded electric power grid and a 21st century air traffic control system that will reduce delays in air travel and save passengers, employees and airlines billions of dollars per year.

See above commentGo here for more information. 

(Ya think there might be something out there that covers all of this?)

I can't stress how important it is for each and every one of us to understand that the American economy is in trouble. I'm not really sure anyone knows how bad the situation really is. Some days I think it's not as bad as it's being made out to be, other days I wonder if we're being told all the Administration knows. On those days I also wonder if we really want to know how bad it is. Growing up, one of the things I learned was don't ask if you don't want to know the truth. Attorneys learn in law school, don't ask questions you don't already know the answers to. That's because they might get an answer they don't want the judge or jury to hear. 

I also think that the Government doesn't tell us all it knows for several reasons. One, that they feel it's too stressful for the public to know everything. Complete knowledge would lead to an economic meltdown that may be avoided. There is always that old bugaboo, that if the public knew what was really going on, there would be a massive recall movement against public officials. And honestly, I think some officials might be in fear of their very lives if the whole truth came out. There are people out there who are not necessarily holding onto sanity with both hands. Some news could cause some of the less tightly wrapped among us to decide it's the fault of this one or that one and "something must be done."

We've been finding out for over a year that there are serious problems our economy is facing.  Here are some possible solutions:

Ignoring it: That's what the Bush Administration basically did when the cracks started showing. Let Free Trade work and the economy will eventually heal itself. That was also what the Hoover Administration did in the late 20's. That lead to a depression. 

Throw money and resources at the problem: that's the solution the Obama Administration has chosen. It's too soon to say it's working or not. History shows that's not the best solution. Economists point to the Great Depression and say that the economy was beginning to pull up and that FDR's tactics only lengthened the Depression. It's generally agreed that WWII is what finally ended the Depression. People were needed to fill jobs that were created by war time needs - defense factories were started, factories already in existence got government contracts to provide military equipment, women replaced men in factories and jobs when the men were called to military service. 

I know I don't have the answers. I'm not an economist, just a citizen with a brain. I have to think about one definition of insanity: doing the same thing over and over again and expecting and different result. Why does the Administration think that throwing trillions of our tax dollars at the economy will work when it didn't stop the Great Depression of the 1930's?

Look at your own personal economy. If you are in economic crisis, your house is about to be foreclosed, your car about to be repossessed, credit card companies breathing down your neck, do you go out and spend more money? Can you buy your way out of debt? That's essentially the national economy. The government is borrowing money from China and printing money like crazy. 

Most of the programs the Obama Administration has proposed to help won't begin for more than a year. The economy and the taxpayer need help now. We have to do something that will have an immediate effect.

The Government gave the public money last year, but doesn't think it worked. They expected us to use that money to buy "stuff" - tv's, cars, clothes, and so on. Instead, many people used it to pay down debt or to save. The taxpayer realized that the economy was poor, so they banked the money in the event it would be needed later. Other people used it to pay for gasoline so they could go to work, or to buy groceries - remember last summer when gas prices hit record highs? 

The Government says that because we didn't buy "stuff", the money didn't go into the economy and the stimulus plan failed. I beg to differ. Any time money leaves my hands it goes into the economy. It's not sitting in the bank, with a sticky note on it with my name on it. It becomes a figure on a ledge sheet saying that the bank has this much more money available to me or to other customers. Sure, the amount I put in the bank is still available to me. But combined with the thousands of others who have made deposits to this bank, my deposit can do a lot - in the economy. It might be part of a loan to buy a house, or a car. It might become part of some one's paycheck or retirement pension. The only time money doesn't go into the economy is when it's not spent - when it's buried in a mason jar in the backyard or kept under the mattress. 

In any case, check out the American Solutions site and see what you think. 

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