Now into year two of the Obama Administration's economic recovery plan, it is clear to the one in five Americans who are either unemployed or underemployed that President Obama doesn't have the firepower to get the job done. Mr. Obama's initial stimulus package of some $787 billion might have been well constructed, but it is obvious that it has been far too slow in creating or saving jobs. In the belief they need to inject billions more into the recovery effort, Congress is reluctant to even describe the jobs creation bill as another "stimulus package," while the President speaks of the $33 billion plan that would include tax incentives and eliminating capital gains taxes.
Invariably, Washington's well intentioned strategies designed to spark a recovery fail to achieve their goals because massive public debt and modest incentives can't alter the mindset of shell shocked consumers. There needs to be a solution other than racking up hundreds of billions of dollars in new debt. There needs to be a strategy that harnesses the enormous underlying strength of the American economy, the power of free enterprise and the trillions of dollars in consumer savings sitting unused if we expect to create the type of economic growth that puts people back to work.
At the heart of a successful strategy is the willingness to make the American citizen a personal partner in the recovery. Far more effective than another government bailout and without the staggering burden of more public debt, Americans investing in our economy once more would prime the pump far faster than anything being considered by Congress. And the investment money is there. At a time of historically high unemployment there is enormous investment capital in private hands sitting in savings banks. It is Washington's challenge to convince taxpayers, on all levels, to invest in new businesses or in expanding business sectors. To do so would require a tax credit program aimed at the typical American who would like nothing better than to get a better rate of return on his or her savings while watching those dollars create jobs and reconstruct our economy.
Convincing people to invest their capital would involve federal legislation that would permit the IRS to offer taxpayers a 20% income tax credit on several conditions:
Taxpayers must certifiably invest a like amount (or more) in a new or expanding business. This tax investment belongs solely to the taxpayer. It is not a loan and is not repayable to the IRS. The revenue shortfall from this incentive program would be a projected $360 billion, or approximately half of the current economic stimulus debt, in the unlikely scenario that as many as half all taxpayers in the nation participate in this effort.
The IRS would recoup this shortfall since each taxpayer (investor) would pay income tax on his/her new investment when it becomes profitable. Each new or expanding business would pay its income tax on profits. Each newly created job would generate income tax on its compensation. Projected total new taxes from this economic growth and job generation would far exceed the $360 billion lost from the IRS 20% tax credit. That intangible ingredient which many economists tout but few can quantify - namely investor confidence - would encourage additional consumer confidence and result in even further job creation. Now, investment tax credits are not new, but harnessing them to a concept designed to act as a firewall against a recession that continues to create an unstable economy would be unprecedented, effective and expedient in creating jobs, especially since they would be revenue neutral.
Standing before Congress during his State of the Union Address the President challenged the joint session that if anyone had a better idea to help create and sustain job growth they should contact him. What he may find is that the better idea isn't to be found on Capitol Hill, but with hundreds of millions of Americans who can be convinced to invest their savings in a nation that wants to balance its books.
President of Eugene M. Grant Company, New York, a Manhattan based real estate company.
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"Convincin
More tax cuts for those that still have money, which is mostly the rich.
Don't you have any real estate in Florida you can sell us?
It would be an easier sell, but then nobody i know is buying any of it.
A few weeks ago, in a statement typical of his party’s propensity for propaganda
The problem with Brown’s declaratio
One year on, the Recovery Act is well on its way to accomplish
Read more @ http://arm
Before any problem can be fixed the root cause must be identified
In our case free trade rhetoric has detroyed domestic jobs and the economic ladders that job experience creates. There is no way that $20/hr labor can compete with $2/hr labor. Factories have been moved. People graduating from college cannot find work. The people in charge of our Government
Back to the people, huh? The American taxpayer has
already invested it's money, where's yours?
...and most people I know aren't as concerned about ROR's on investment
How many people really believe that "power of free enterprise and the trillions of dollars in consumer savings sitting unused" is all that is needed to save America.
True American capitalism is dead. The old American work ethic is dead.
Our business leaders sold out American workers and their families a long time ago, and it is still continuing unabated. Yes, we have a right to "blame business". We have a right to be down right angry with our business leaders.
American Capitalism is not dead, is was stillborn.
But note: until Eisenhower
A few years later, and the upward tick of workers' wages had ceased Their buying power over the last 3 decades has actually decreased in constant dollars. Meanwhile the average CEO's salary and bonuses climbed to many multiples of what it was 30 years ago. American businessme
This economic situation was driven by excessive debt. This escessive debt worsened when the economy began to slide. Learning from that mistake, people are becoming reluctant to begin that cycle again.
Also, they are wary of the next tax hike and fee increase as has been advocated by the administra
Individual spending and investing will obviously do more good that government spending. But the climate of the current financial system is one that does not invite that spending or investing. This climate is one that tells people to spend as little as they can, to hold on to as much as they can. Individual
Two issues follow:
1. Skilled labor will be very expensive, because it'll be too skilled even for robots.
2. What to do with the unskilled labor?
Yet today, major social issues stems from lack of 'unskilled labor'. Example:
Teachers in unison complain, "Parents don't care for and participat
Ample data suggest that lot of health-car
The paradigm shift started after WWII; when joint-fami
It may not hurt to return to Good Old Days; living within limits of single-inc
The incentive to invest in America should be directed at banks, not at individual savers, and there must be some amount of regulated asset transparen
Deposit banks are federally insured, so it's reasonable for the federal government to expect the banks to serve the public interest in the domestic economy. Perhaps there should be a tax on foreign investment or tax breaks for domestic investment