Economic Stimulus, Jobs Crisis, Specific Problem Areas and Specific Solutions Ideas
First consider the following problem areas.
A. Problem Area Taxes are Lower for Rich People:
1) Capital Gains, 2) Dividends, 3) Carried Interest, 4) Deferred Wages,
B. Problem Area Taxes for Social Security, Medicare not paid by the Rich (These social programs are under funded).
C. Problem Area Most People Don't Work - although women did join the work force and increase the number of people competing for jobs. These 4 types of people require others to take care of them whether family or social programs:
1) Children, 2) Elderly, 3) Infirm, 4) Spouses at home
D. Problem Area The Alternative minimum Tax doesn't work for Rich who still have "Loop Holes", Pay "Non Wage Tax Rate", and No Definition of "effective tax rate" except for the tax in the IRS tax booklet. Taxable income and earning is reduced by some calculations, then deductions are put through further manipulations, tax credits are added in, and so on. The original concept of the AMT was for the rich to pay more, but seems they were excluded from the final law when it was passed.
E. Problem Area Congress Spends Funds that We Don't Have.
1) War over 500 Mile from this Country is Questionable, 2) There is No Trust Fund for War Spending, 3) Taxpayer's Borrow Money for War, 4) Much of Spending is a transfer of Taxpayer money to industry, 5) Too much Spending for Prisons for nonviolent crime, 6) Over 1600 Federal Subsidies, 7) Social Security Funds Stolen for War Funding.
F. Problem Area Banks Are Predatory, engage in dishonest and Criminogenic activity, One Idea: "Banks should become a Utility" managed like a the water company. It seems like a good idea, because they function to lend money and with Fractional Reserves - they are really making money "out of thin air" (transparency and regulation goes without saying if banks become a "Utility").
G. Problem Area Borrowed Money which brings up Mondern Monetary theory, central banking, borrowing money for government operations, getting loans from banks as the preferred method and not considering other alternatives than creating this massive federal deficit:
1) MMT (Modern Monetary Theory) has some different ideas. If we are the government, we own the treasury, why don't we create money and institute monetary policy, and why should we pay back money borrowed, or ... even borrow money to begin with???? Unless we borrow or lend to foreign entities we can create money without borrowing it.
2) Monetary Policy is all about making sure there is enough money in the system. If businesses can be born, and grow...if people can borrow and use credit,... then the system works. But today with dishonest deals driving out honest deals ... like the No Document Mortgages, packed and resold within hours or days. Money supply should be tied to changes in population to prevent money from getting tight as it is now. Small businesses can't get loans today (I am told). And people that want to refinance homes can't refinance.
3) Monetary Policy is supposed to work for both Main Street and Wall Street. And it has nothing to do with "pulling yourself up by your bootstraps". Today the money system is Broke. And the Economists in charge are "Neoliberalist".
"Neoliberalism is a contemporary form of economic liberalism that emphasizes the efficiency of private enterprise, liberalized trade and relatively open markets to promote globalization. Neoliberals therefore seek to maximize the role of the private sector in determining the political and economic priorities of the world."
H. Problem Area Job Creation is Really Creating an Environment For Starting Small Businesses (Small Businesses are the heart of the USA, employ the most people, and manufacture the most products - it is a myth that big giant corporations are the heart of the USA).
I) Problem Area We are transferring large amounts of funds from the taxpayer to industry through spending, through tax abatements, through public private partnerships, and through federal subsidies that number over 1600 to agriculture, oil industry, and many others like Walmart.
J) Problem Area Taxpayer funds transferred to the defense industry doesn't provide the economic stimulus that another manufacturing industry would. The economic multiplier effect of producing goods and sending them to the market for other producers to utilize and sell as a component of their product is much less. War material is often controlled and kept out of the common market, it is often damaged or destroyed, and resale after obsolescence is often to foreign countries outside of our markets.
Now here are some potential solutions or ideas:
1) Get rid of the Central Bank (since we know they are in bed with the people that they are supposed to Regulate, the Revolving Door from the Treasury to Big Banks to the Federal Reserve proves this is one big "Club"). No one knows why the FED was created in secrecy without congress anyway.
2) Break Up All Banks that are too big to fail with Antitrust Laws (separate commercial banks, investment banks, and savings banks).
3) Stop Foreign War over 500 Miles from any one US State.
4) Stop asking the Government to Create Jobs.
5) Stop asking Businesses to Create Jobs.
6) Fully Fund Social Security and put money behind a Firewall (that is why we called it a "Trust").
7) Extend Unemployment benefits another year
8) Bring Army Troops back to permanent stations in the USA from Japan, Korea, and Germany. This means building (Stimulating) more housing, barracks, training facilities, and maintenance facilities. It also WILL Stimulate the US Economy as their money is spent in the US.
9) Create Incentive programs in K-12 through small Grants of $2000 - $4000, and in Colleges and Tech Training Schools of $5000 - $6000 to test new inventions, create contests in science, agricultural labs, greenhouses, etc.
10) Close the Department of Education since it has failed.
12) Scrape the current federal income tax scheme in favor of a progressive tax that only allows 5 deductions, recognizes wages and earnings the same way, investment dividends and short and long term profits and loses are treated with an exclusion for the first $15K earned, then taxed at 24%, interest rates for two mortgages can only be deductible up to $100K per house, there would be no such thing as a lower tax rate for "carrying fees" earned through business. This tax plan will get Lawyers, Tax Lawyers, Accountants, Tax Accountants into other economic activities that could be helpful to the GDP and may have a multiplier effect on the economy (hopefully we can get more financial managers into manufacturing also). This may also reduce the number of IRS employees needed to review tax forms. Outlaw Deferred Wages since they erode tax base and obstruct visibility of Executive Wages Earned (nontransparent).
A) Progressive tax with few deductions from 14% ($1-$22K per year) 16% ($23K-30K per year) 18% ($31K-38K per year) 20% ($39K-$49K per year) 22% ($50K-$60K per year) 24% ($61K-70K per year) 26% ($71K-82K per year) 28% ($83-$95K per year) 30% ($96K-120K per year) 31% ($121K-$1.5M per year) 32% ($1.6M- infinity)
B) All wages, tips, carry fees, income treated the same
C) Rich people pay full Social Security and Medicare taxes
D) Allowed to own two houses and deduct up to $100K per year per house, additional houses are called investments and you can't deduct the interest paid from income taxes
E) Head of Household and those with dependents can deduct health insurance premiums, copays, drug costs, and medical bills
F) Investments are encouraged, loses and gains are only calculated when actually sold stocks, bonds or other financial instruments.
G) Pensions are not taxed by the federal government unless they exceed $100K per year in which case they would be taxed at the lowest rate or 14%
H) Personal deduction allowed, plus deduction for dependents and spouse
13) Overturn NAFTA and CAFTA
14) Stimulate manufacturing with "Economics Free Zones" in states and cities across the USA which would remove barriers to businesses, reduced taxes, reduced licenses, reduced certification requirements, no unions, reduced sales tax, reduced production tax, reduced capitol investment tax, maybe customers would not have to pay sales taxes either.
15) Stimulate manufacturing by providing small grants to trade schools and to students toward teaching them about business and how to start a manufacturing enterprise (laboratories, agricultural plots, energy and alternative energy testing projects, chemistry projects, hazardous waste control technology).
16) Stimulate manufacturing by identifying banks that would lend to new businesses, establish new small business federal loan programs at federal loan rate of 6% or 8%, identify technologies that will be trends in the future and will be focus of federal loan program (waste disposal, recycling, energy, autos, mass transportation).
17) Stimulate business creation with additional public works programs, and energy technology programs grants, loans, reduced production tax, sales tax, capitol investment tax, for businesses with capitalization below $10 Million Dollars that will produce energy or manufacture capitol equipment utilized in the energy industry.
18) Make Health Care Portable across State Lines ending monopolistic Insurance Programs.
19) Make all Student Loan Interest Rates go down to either 6% or 8% to end the predatory rates from financial organizations who get their money for free or nearly free (Fractional Reserve Lending) and who now use profits to Lobby Congress.
20) Break up the TV/Cable Monopoly with Antitrust Law. No media owner/corporation/cabal should have the power to advertise talking points and call it news.
21) Outlaw Lobbying Congress and Gift Giving to Congress (i.e. free hotels, free dinners, free vacations, free conventions, free plane rides). And accepting gifts/contributions from foreign entities by congress is treason. Campaign contributions shall be set at the same limit for all US Citizens, but corporations and PACs shall not contribute to congressmen/women. Congress shall raise money through books and speaking, but can't sell books to PACs or corporations or some rich entity.
22) SEC must be bolstered with full backing of US Treasury if it is to face big banks in court to discourage criminogenic behavior.
23) SEC probably needs manpower of 200 additional agents to investigate Fraud and Criminogenic environment.
24) Corporations need to be rated not only on their risky behavior, and for hiring unqualified personnel to create mortgage loans or other financial instruments, but also for the amount of leverage they use and lack of reserves they keep on hand (transparency is key).
25) Corporations need to be Rated for all consumers, investors, or potential business partners with regard to transparency and independent audits of Off Balance Sheet Transactions. GAAP rules are the goal for US Businesses and should be mandatory for transparency.
26) Politicians should be Rated and Evaluated when they intervene/pressure Federal regulatory offices and agencies. For Instance it is said that congress interfered with the IRS audits of Rich people in the past. The real danger is that political pressure can allow regulations to be bent without the politician knowing the full context of the US regulations or the Lobbying Entity's Activities (Context is crucial to all US systems).
27) Make Banks become "Utilities" like water or electric with profit controls, leverage controls (less than 10 to 1), fractional reserve controls (minimum on hand assets), Interest Rate controls (Student Loans at either 6% or 8%, Small Business Loans either 6% or 8%), Off Balance Sheet transaction controls (to make explicit what is allowed and what is prohibited), and transparency of credentials for bank loan officers and mortgage specialist.
28) End the Revolving Door Between Federal Regulators and the Industries they Regulate. There are rules that exist that prevent government employees from working in industry jobs for a period of 5 years under certain conditions and circumstances. Disclosure Forms can be used to keep up on job changes of government employees that want to move from the Treasury or another agency to work for the entity or industry they were sworn to regulate (this forces people to chose their careers and stick to their decisions).
29) There should be a US congressional program to monitor, control, discover, and eliminate slave labor and child labor used in foreign countries for cheap labor. If US textile and manufacturing jobs have gone over to foreign countries, then we should have certainty that the labor rate is not a slave labor wage. We should not lose manufacturing to slave labor.
http://www.truth-out.org/have-super-rich-seceded-united-states/1326127151
http://www.youtube.com/watch?v=36kizAjPmuo&list=PL0F4ACDBAAD6AA9CA&index=2&feature=plpp_video
Brief 17 minutes run down on current environment: http://www.youtube.com/watch?v=u9Qe0HlKKfw
Teaching session 56 minutes: http://www.youtube.com/watch? feature=endscreen&NR=1&v=6YT84CokUsA Controversy about firing US AG: http://www.youtube.com/watch?v=I12oDVr2RZQ&feature=related
http://www.bloomberg.com/news/2010-06-29/banks-financing-mexico-s-drug-cartels-admitted-in-wells-fargo-s-u-s-deal.html
http://www.mediafreedominternational.org/2012/01/26/wachovia-bank-laundered-money-for-latin-american-drug-cartels/
http://www.nakedcapitalism.com/2011/04/wachovia-paid-trivial-fine-for-nearly-400-billion-of-drug-related-money-laundering.html
http://www.npr.org/rss/podcast/podcast_detail.php?siteId=7495773 Robert Reich
and here is the Blog from Robert Reich on Truthout.com
http://truth-out.org/opinion/item/8214-break-up-the-banks-says-the-dallas-fed
http://www.pbs.org/wgbh/pages/frontline/money-power-wall-street/
http://en.wikipedia.org/wiki/Savings_and_loan_crisis (1980s and 1990s) ( total cost for resolving the 747 failed institutions was $87.9 billion)
http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%932010
http://www.dallasfed.org/assets/documents/fed/annual/2011/ar11.pdf
http://www.neweconomicperspectives.org/2011/09/william-black-why-nobody-went-to-jail.html
http://therealnews.com/t2/index.php? option=com_content&task=view&id=31&Itemid=74&jumival=7926
http://en.wikipedia.org/wiki/George_Akerlof
http://en.wikipedia.org/wiki/William_K._Black
http://en.wikipedia.org/wiki/Yves_Smith
http://en.wikipedia.org/wiki/Subprime_mortgage_crisis
http://ideas.repec.org/a/bin/bpeajo/v24y1993i1993-2p1-74.html
http://www.walmartsubsidywatch.org/
http://en.wikipedia.org/wiki/Accounting_scandals
http://en.wikipedia.org/wiki/Accounting_scandals#Notable_accounting_scandals
http://news.brown.edu/pressreleases/2011/06/warcosts
http://billmoyers.com/episode/full-show-how-big-banks-are-rewriting-the-rules-of-our-economy/
http://en.wikipedia.org/wiki/Neoliberalism
http://www.commondreams.org/view/2011/04/02-5 link on neoliberalism
Banking Reform, Economy, Globalization, Unemployment, US Budget, US Banks, US Congress, US Debt, US Politics, Federal Reserve, Lobbying, Revolving Door,
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