As to the appropriatenmess of the absolute magnitude of public expenditures, I suspect that we have already cut too far in non-defense spending to maintain a position of economic leadership. We have stripped our educational systems, under-invested in infrastructure, and allowed free market philosophies to degenerate into support for corporate monopolies and oligarchies that stifle competition, rather than enhancing it. If we are looking for ways to modify our tax structures to enhance competitiveness and job creation, we should:
- eliminate preferential treatment of certain types of income such as dividends, capital gains, inheritances, and non-cash employee benefits.
- eliminate corporate taxes
- get employers out of the business of subsidizing health benefits
- either fund social security, medicare, and unemployment from general taxes or eliminate income caps for existing taxes, while eliminating employer contributions to these programs -- employers should not be taxed for providing jobs.
The most recent proof of this is the last 3 years. The government has created all kinds of tax breaks and incentives for capitalists (those who control capital) to start or increase business activity. Net result- little to nothing in job creation. In a capitalist system jobs are just another reflection of supply and demand. If strong demand exists for a product, someone will figure out how to acquire the capital necessary to produce that product. Without demand there will be NO investment.
Economic theory asside, the elephant in the room squashing US jobs is Globalization. We have to figure out how to participate in globalization while still creating and protecting job growth in the US.
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David Didier, GA
"the government (at any level) adds nothing to the GNP" - That would certainly be a surprise to economists since government spending is a major part of GDP, reflected both in spending by consumers employed by the government , spending by people who work for companies producing their goods under government contract )e.g., the entire defense industry), and the majority of the health care industry which is financed through government funding, among many others.
"As Julie said, when was the last time a poor person hired someone?" - Like the rest of us, poor people "hire" by creating demand for goods through their purchases. Very few people are hired directly by individuals regardless of wealth. They are hired by companies.
"History has clearly shown that when small businesses pay more taxes, jobs are eliminated." - If you read my initial post, you will see that one of my recommendations was that all business taxes be eliminated. Business taxes make no economic sense and only serve to make our goods and our workers less competitive in a global market.
BTW, I've been a business owner since 1984, of both large companies and small, and am well familiar with the economics involved.
Also above, you included capital gains & inheritance as categories of income while neither is income.
Then while implying the wealthiest 1-2% don't pay enough tax, you then say eliminate corporate taxes. Since the wealthiest persons own & direct the wealthiest multi-national corporations this would provide them a means of no income tax consequences at any level in the US???
I'm assuming instead of companies paying for employee health insurance, you'd have everyone on the government health rationing system that will surely result.
Since the vast majority of our politicians are more concerned about being re-elected that actually passing needed legislation, we have no one in Washington willing to cut anything where they have created an "entitlement" - welfare, medicare/medicaid, unemployment compensation & debt service. I'd advocate returning ss to its original purpose to provide a safety net of essentials for the poor who cannot provide themselves shelter & food in their old age. I'd eliminate welfare as it currently exists, making some productive form of work mandatory in order to receive benefits (meaning no direct welfare for able bodied persons unless they work). I'd limit unemployment compensations to 90 days, no exceptions, no extensions (we'd find this would eliminate our illegal alien problem because there would be no jobs for them). I'd take the savings from these entitlement cuts and pay down/eliminate the national debt. Once eliminated, the saving from national debt service would allow an orderly increase in ss & medicare limited to funds received to fund it.
As for education, you are also mistaken. The current government contribution to education (fed & st) is higher per student than ever before in actual dollars, rising much higher annually than the rate of inflation over the last 40 yrs.
Remember reality is that small businesses provide the majority of jobs in the US, not large corporations that you seem to want to benenfit with no corporate taxes.
And for the comment someone made 'that rich men don't create jobs, demand for goods & services creates jobs". Sounds good, but it's incomplete. Demand for goods and services come from people being gainfully employed. Therefore, jobs create demand for goods and services. The question is who creates these jobs, it's small businesses in the US (small business employs over 70% of all employed in the US). It's time our government understands this & provides small businesses with lower taxes (meaning lower income taxes on small business owners who are currently labeled as the rich - making over $200K per yr). Instead our government bales out large inefficient businesses, provides these large inefficient businesses with tax breaks all the while advocating higher taxes on the small business owner through raising his income tax rate.
David Didier, GA
Where does the government get its funds? The answer is elementary, by collecting taxes from those who actually produce goods and sevices. Therefore the net effect of the government jobs, services, etc is a subtraction (not a multiplier) from those who actually produce goods and services -the same that pay the taxes the government collects...Econ 101. The government portion notation of the GNP is only to provide identification of the various sectors of the economy involved, not who creates GNP.
David Didier, GA
Great post, Dave. Too many facts however. Hard to convince ANY libs with that much common sense.
I'd also eliminate the welfare baby bonus...and all the anchor babies, regardless of their current age. They were either born by bona fide registered citizens of the USA, or they are undocumented immigrants.
As to my first comment...it was prompted by this:
Bread Winner of the Family...Making Babies!
I was speaking to an emergency room physician this morning. He told me that a woman in her 20s came to the ER with her 8th pregnancy. She stated, "my momma told me that I am the breadwinner for the family." He asked her to explain. She said that she can make babies and babies get money for the family. The scam goes like this: The grandma calls the Department of Child and Family Services and states that the unemployed daughter is not capable of caring for these children. DCFS agrees and states that the child or children will need to go to foster care.
The grandma then volunteers to be the foster parent, and thus receives a check for $1500 per child per month in Illinois . Total yearly income: $144,000 tax-free, not to mention free healthcare (Medicaid) plus a monthly card entitling her to free groceries, etc, and a voucher for 250 free cell phone minutes per month. This does not even include WIC and other welfare programs. Indeed, grandma was correct in that her fertile daughter is the "breadwinner" of the family.
This is how the ruling class spends our tax dollars.
Sebastian J. Ciancio, M.D. Urologist,
Danville Polyclinic, LTD
And liberals wonder why the TEA party got started???
When the one you love becomes a memory, that memory becomes a treasure.
Surely if you had read the initial post, you'd understand the circumstances unique to small business.
Last edited by Granddaddy; 01-30-2011 at 01:48 PM.
David Didier, GA