Too little information has disseminated to the American people as to the severity of what will occur if the Federal government fails in its' resolve to put a long-term end to this crisis. What began a political football often tossed back and forth, by whatever party occupied the White House in the past has become far more serious than a game of touch on the West Wing lawn.
The political wrangling and positioning on the Debt Ceiling and a delay in a Vote to raise Ceiling in order to prevent the USA from default has now become the equivalent of a group of kids tossing back and forth a deadly bomb. As Congressional members (particularly naive freshmen) treat the debt ceiling as the Holy Grail while economic policy experts such as Alan Greenspan view it to be an unnecessary political (evil) symbol of debate for whatever side wishes to blame the other for uncontrolled and wasteful spending. Congress fails to see or accept that are other vested players in World Cup competition who have somewhat congealed the U.S. to join in the tournament. They pay close attention and with growing alarm as days of delay, then weeks where we are counting down to what some perceive as an artificial deadline drawn in the sand. Europe, Asia, Africa, South America and the Global Economy have been observing our behavior with a micro-economic eye and they are seeing only what they suspected before this debacle of debate begun.
The global community is increasingly tiring of U.S. domination of the world’s economy by holding them hostage by the U.S. dollar. The European Community, members of OPEC and now the robust transformation occurring in Eastern Asia namely India and China becoming less tolerant of U.S. narcissism and what they view as the self-centered nation who can no longer tout its outstanding production, quality in the competitive marketplace. Yet the U.S. continues to flex its (military) muscle as a super power enjoying all the benefits that the dollar affords, as it is the currency of reserve and is the universal standard for most trade around the world. These investor nations tire of our persistence in touting the good old American Eagle as “strong” unshakeable, solvent, “good as gold” in value by inherent merely on the basis of the day the Franklin is printed. For too long the predominant presence of the dollar in the world market is increasingly views us as “suspect” at best and “counterfeit in the worst scenario” as it is the only export edge we hold! (We propagated the belief of all members of the dollar’s intrinsic and inherent value to the degree when it became clear that there was not enough gold in the universe to support the number of bills printed. Thus, the Nixon administration carefully and with little attention dissolved all ties to gold standard back in the seventies).
The other advanced economies have in past decades developed from third world or second rate into top-notch economies that have seen remarkable growth while the U.S. has remained relatively stagnant.
The rise in economic influence of the global community now surpasses us in production cost margins, exports, market growth. Many of these same players hold our trillions of dollars in debt in the form of bonds, securities, and stock investments increasingly concern our debtor nations. When our debtor nations learn before Congressional Hearings how our banking and financial institutions “bundle a multitude of suspect mortgages” as investments and “knowingly sell this junk” to foreign investors. Our debtor nations then suffer a collapse of monumental proportions when their investment in “safe securities” is nothing short of a “con game.” Worse yet, they observe how the perpetrators of criminal behavior go unscathed for their overt acts of piracy on Wall Street.
I had some ideas to offset the largest discrepancy that is the outrageous and unnecessary tax breaks and cuts for the wealthiest Americans. This item in itself is one to make you stand up and holler! When one researches the facts how these lower tax rates exist as a (welfare) benefit for the rich and has no bearing on economic stimulus or bettering job opportunity for those with little or no income. The unmitigated gall that some who Speak for the House that removing these tax breaks or raising taxes is off the table! Members of the GOP and the Tea Party Poopers seem resolute to propagate this lie to the American public. It is too much for anyone with any degree of intellect.
In my research, I found that some of my arguments and suggestions that follow stand as sound policy. They contain a fair amount of vision, creativity, a paradigm shift it all centers on cutting waste, stimulating the economy, keep taxes as is with a new twist and it is centered on what is most apparent. It is about Jobs and the Economy! We need jobs and more jobs to put people back to work and have wherewithal to care for their families.
This issue of jobs is an area of miserable failure of three Republican Administrations and I hope to offer some ideas where jobs created to “repair America’s crumbling infrastructure can put hundreds of thousands to work in good paying jobs, primarily funded by the Federal Government with Tax Revenue they collect from the most wealthy. They will do so in order to retain a fifty-percent incentive in paying taxes as every other wage earner. The difference is they pay a fair and appropriate rate of tax and can receive an immediate tax credit if they perform their duty as a privileged citizen of a great democracy. If the wealthiest among us cannot or will not “pay” and earmark taxes toward job creation, they will receive no reduction in tax, no credits and no special treatment.
At the same time, wage earners under $250,000 will receive their own tax credit, not a deduction. As the IRS tax, law is right now and for some time, Medical Expenses as an Itemized Deduction can only be applicable if the total of all of your expenses exceed 5% of your adjusted gross income. With ever-increasing health costs, threats to cut Medicare payments and eligibility, a confused and an often confusing and waste-filled prescription program it is time to toss out the current rules governing Medical Expenses. My suggestion is every citizen, especially our seniors with high co-payments, annual deductibles, Rx co=pay amounts, doctor visits and other items not covered by insurance now be an allowable medical expense. Individuals and Families with incomes less than $250,000 will now track and keep all receipts of their expenses, including shared or paid insurance coverage.
At tax time they will total all of their expenses, retain receipts as proof of payments made and report the Total Amount on Form-1040, 1040-A. It will not appear anywhere on Schedule A of Itemized deductions that only reduce the percentage rate of taxes paid. Under my plan, you will now use the flip side of the 1040 where it lists Foreign Tax Credits, Taxes paid to another country, money sheltered in the Cayman Islands, etc…all the items where 95% of Americans ask “what is that?” and “I guess I enter zeros!” The zeros appear all down the center portion of the form on the far right. These “foreign” or applicable for the rich” entry is made but only after computing the total amount of tax, you owe. However, now every American can play the flip side of the 1040 with the inclusion of a line where one enters your Total Medical Expenses! In my situation, I estimate that co-pays, deductible expenses, co-pays for skyrocketing drug costs would total somewhere in the area of $1500 per year. Now I can have this life saving deduction as a direct “credit” against my total tax bill and the Federal Government reimburses the $1500 in expense. I am not certain as to how this may affect current RX programs and the recent Health Reforms passed a few years ago, but it is my belief the cost savings in the entitlement programs will equal or exceed what is given as a credit to every taxpayer.
The re-creation of a New Deal WPA is the best and possibly the only way to stimulate the economy, provide jobs, self-esteem as well as the other benefits in that these new wage earners will pay their “fair share of taxes” and unlike the rich they will need to spend their income in order to survive. This in turn will generate a cadre of other jobs related to reconstruction, bridge building, road and highway redesign, environmental programs. The construction industry requires large equipment to undertake a nationwide overhaul of our infrastructure. Thus, companies such as Elgin may need to triple the production of huge earth movers, which means they need more workers. Highway, bridges and roads require a great amount of concrete, cement, gravel, sand, asphalt and hard hats and orange barrels. What happens? Again, private industry will happily come forward to produce and sell the necessities to maintain a modern civilization before we are all in the woods visiting an outhouse because our Cities sewer and water systems have failed.
It only makes sense! These jobs must go forth and soon so, we are not forced to start from scratch by building the Roman aqueducts. These infrastructure projects have to start sometime and there will be a deadline in getting it done. There is absolutely no reason to hesitate, to revitalize and improve our roads, highways and bridges. The one obstacle may be that the banks may not garner all of profits of interest on loans they are not now issuing anyway. Government uses the wealthiest as well as all other taxpayers to “choose” or opt on their Tax Return the amount and projects they wish to be undertaken. The people call it a referendum. It is communities organizing in common not counter purposes. It is also something the large banks, biggest corporations and wealthiest individual’s no long place any priority. It is DEMOCRACY in Action!
This blog is likely to be continued!