RichardAWilson
19th September 2011, 20:53
Infrastructure Spending
The traditional Keynesian Multiplier shows that $1 billion in spending will create between 10,000 and 18,000 jobs. (The range is based on if the infrastructural financing is being used for repairing existing infrastructure or building new)
According to the American Society of Civil Engineers, we will need to appropriate $2.2 trillion on infrastructure within the coming decade.
Solution
Infrastructure spending should be front-loaded to maximize job creation in the here and now. Furthermore, T-Bond yields have fallen below 2%. (I.e. Borrowing for financing infrastructure spending has never been more affordable and wise)
Corporate Taxation
I hate to agree with Conservatives and right-wingers on this matter.
However:
1. Corporations are institutions.
Profits aren't the problem. The problem is how those profits are distributed. Corporate income taxation is a form of double taxation in the sense that it reduces the net-earnings that are available for distribution to shareholders.
It'd make more sense to slash the corporate tax and increase tax rates on individuals (I.e. Dividends, Stock Options and Capital Gains).
Nonetheless, corporate tax reduction should be longer-term.
In the short-term, we need to induce business spending and job creation.
The Fortune 500 are sitting on over $1 trillion in surplus cash. Historical evidence has shown that tax incentives and deductions for new capital spending are effective toward inducing businesses to spend more money.
(I.e. We should make expenditures tax deductible dollar-for-dollar with no limitation)
2. America's corporate tax rates are higher than Europe's.
There's a reason Microsoft and Pfizer have invested so much in Ireland.
There's a reason we're running trade deficits with the Europeans, even though European labor costs are higher than our own.
To the degree that capitalism is a zero sum game, it'd make sense to abolish our corporate income tax to attract foreign (I.e. European, Asian and Latin) businesses to our nation. Mainstream macro-economists have estimated that we could create millions of new jobs by abolishing the Corporate Tax.
Solution
Introduce a dollar-for-dollar capital spending tax deduction with no limitation. In the longer-term, begin reducing Corporate Income Tax Rates and purging write-offs, useless deductions and perverse incentives.
Meanwhile, tax rates on personal stock income (I.e. Dividends, Capital Gains, Etc.) should be increased in proportion to the reduction in corporate income tax rates.
International Trade
We're running unsustainable trade and capital shortfalls with the Arabs, Asians and Latins. The problem is that protectionism isn't a viable solution to the problems affecting the global working class.
NAFTA is immoral and unethical because it does make it easier for multinational corporations to enslave the working men and women of Mexico. The same can be said of our trading relations with China.
Nonetheless, free trade has provided men and women in those countries with millions of jobs that they otherwise wouldn't have in the absence of trade. NAFTA, for instance, was worse for America's workingmen than for Mexico's. The same holds true for China, South Korea and Vietnam.
Instead of resorting to traditional protectionism, we need to look elsewhere for solutions to our trade imbalance. Congress should be embracing the Warren Buffet Act, which would institute non-discriminating trading certificates that'd require importers and exporters to reach equilibrium (balance).
The traditional Keynesian Multiplier shows that $1 billion in spending will create between 10,000 and 18,000 jobs. (The range is based on if the infrastructural financing is being used for repairing existing infrastructure or building new)
According to the American Society of Civil Engineers, we will need to appropriate $2.2 trillion on infrastructure within the coming decade.
Solution
Infrastructure spending should be front-loaded to maximize job creation in the here and now. Furthermore, T-Bond yields have fallen below 2%. (I.e. Borrowing for financing infrastructure spending has never been more affordable and wise)
Corporate Taxation
I hate to agree with Conservatives and right-wingers on this matter.
However:
1. Corporations are institutions.
Profits aren't the problem. The problem is how those profits are distributed. Corporate income taxation is a form of double taxation in the sense that it reduces the net-earnings that are available for distribution to shareholders.
It'd make more sense to slash the corporate tax and increase tax rates on individuals (I.e. Dividends, Stock Options and Capital Gains).
Nonetheless, corporate tax reduction should be longer-term.
In the short-term, we need to induce business spending and job creation.
The Fortune 500 are sitting on over $1 trillion in surplus cash. Historical evidence has shown that tax incentives and deductions for new capital spending are effective toward inducing businesses to spend more money.
(I.e. We should make expenditures tax deductible dollar-for-dollar with no limitation)
2. America's corporate tax rates are higher than Europe's.
There's a reason Microsoft and Pfizer have invested so much in Ireland.
There's a reason we're running trade deficits with the Europeans, even though European labor costs are higher than our own.
To the degree that capitalism is a zero sum game, it'd make sense to abolish our corporate income tax to attract foreign (I.e. European, Asian and Latin) businesses to our nation. Mainstream macro-economists have estimated that we could create millions of new jobs by abolishing the Corporate Tax.
Solution
Introduce a dollar-for-dollar capital spending tax deduction with no limitation. In the longer-term, begin reducing Corporate Income Tax Rates and purging write-offs, useless deductions and perverse incentives.
Meanwhile, tax rates on personal stock income (I.e. Dividends, Capital Gains, Etc.) should be increased in proportion to the reduction in corporate income tax rates.
International Trade
We're running unsustainable trade and capital shortfalls with the Arabs, Asians and Latins. The problem is that protectionism isn't a viable solution to the problems affecting the global working class.
NAFTA is immoral and unethical because it does make it easier for multinational corporations to enslave the working men and women of Mexico. The same can be said of our trading relations with China.
Nonetheless, free trade has provided men and women in those countries with millions of jobs that they otherwise wouldn't have in the absence of trade. NAFTA, for instance, was worse for America's workingmen than for Mexico's. The same holds true for China, South Korea and Vietnam.
Instead of resorting to traditional protectionism, we need to look elsewhere for solutions to our trade imbalance. Congress should be embracing the Warren Buffet Act, which would institute non-discriminating trading certificates that'd require importers and exporters to reach equilibrium (balance).