The President’s speech on Sept. 8th was a welcome change in tone, but disappointingly short on bite. Offering more tax cuts to employers goes nowhere if employers don’t hire. And why should they if they have no need for extra help in manufacturing when demand is still weak? Employers are the supply side of the equation; the consumer is the demand side. And simply, until more people have jobs, demand will remain weak.
All that the president offered was some payroll tax deductions that should offer some increased demand thru increased purchasing power. But when that runs out, where’s the real demand created by those who have jobs?
In the meantime our infrastructure continues to decay and becomes obsolete. This is timeless. On top of that, we need new infrastructure just to keep up with population growth and new technological developments. Airports, highways, broadband, educational and research facilities need addressing in the 21st century. Would you like to read about your child on the school bus that went down on the bridge that collapsed due to lack of maintenance?
Whether we can afford to address these issues is not a concern when we have the ability. The debate over ideology shouldn’t take precedence when it comes to feeding our population. A 20% unemployment level is NOT the norm. So cutting spending to match revenues based on 80% employment skirts the issue. Not to mention the emotional and structural deterioration in our workforce due to being out of work.
The main issue is create jobs so those newly employed can pay taxes; instead of being a burden on the unemployment, social security, and healthcare benefits because they DON”T have jobs. Instead, those in our congress believe it’s more important to balance a budget when a sovereign government has the ability to stimulate and do more benefit for the citizens than inflict pain trying to satisfy an outdated, ideologically disproven tax policy. When the ideological crowd proclaims Keynesian fails in the same breath they denounce evolution and global warming, they only display their ignorance. You gotta believe their disproven theories advancing tax cuts as supply side economics are just as misplaced and self serving. Tax cuts only benefit those who pay taxes. Jobs benefit everyone.
The President should have gone big in the expectations department. He should have challenged the congress to approve a more ambitious proposal rather than try to get a compromised something approved. After the election things will return to a do nothing congress if he gets reelected and congress stays with the same mix. Unless there’s a mandate for this proposal, the stimulus he seeks will once again not be enough. And if he gets the current proposal, then what? We need 15% of the workforce to return to work---not 1%! Those elected officials running against a bolder proposal should be voted out by the electorate in November. Then maybe we can return to getting the country solving problems; not gridlocked by the ideologically controlled minority.
A bolder proposal would have been for the president to offer amnesty for the unpatriated offshore dollars that corporations find themselves awash in. Bringing back those funds to the country would incur a tax consequence. How about making a tax amnesty deal that says you can bring back those funds if they are invested in war type like bonds that were used for financing WWII? How about using those funds for Infrastructure bonds in the amount of trillions of dollars creating MILLIONS of jobs while modernizing and maintaining our country’s competitiveness? Today’s borrowing rates are the most opportune in years. Defer some of the principle via tax gimmicks. Get creative; not rely on outdated dogma. Increased tax revenues from increased employment helps to offset other expenses. Simply cutting expenses will only lead to the demise of the country. Think about it. Don’t just jump on the sound bite of the day. Does decreased spending create jobs, or does satisfying the needs of the country do even more than create jobs?
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