Both halves of Congress are trying to create a more fair tax plan that will promote growth and simplify the code. I am skeptical that anything will get done though as it appears that this Congress is incapable of doing anything significant.
Since Congress will almost certainly fail, I thought I would put my suggestion on the table. As I analyze it, it is probably the most likely plan that I have ever seen to encourage employment growth.
The first step is to not change anything for individuals except to increase the amount of money saved in long-term savings without tax penalty. This should be doubled from its present rate. The government is in the retirement business, and it isn’t doing a sufficient job of managing it. The government needs to get out of the retirement business because the government can rarely do something well. Social Security is a broken plan, and we all know it – we just need to transition out of the retirement business slowly so that we do not screw up the American workers that depend on Social Security.
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Don’t let the current partisan bickering on corporate taxes make it seem like both sides of the aisle don’t want this. It is good for America and everyone that understands economics understands this. The issue is that when the Democrats held power, they couldn’t effectively do this because their liberal wing (i.e. the people that do not understand economics) would crucify them in the election booth.
Suddenly, an idea that has been accepted by economists and by policymakers on both sides of the political aisle—that high taxes on business hurt investment, workers, and the economy—is considered “absurd.”
In 2012, President Obama and his advisers proposed lowering the corporate tax rate because it “creates good jobs with good wages for the middle-class folks who work at those businesses.” In 2013, Lawrence Summers, President Clinton’s Treasury secretary and chairman of Mr. Obama’s Economic Council, argued that the tax on corporate profits creates a burden without commensurate revenues for the government and that changing it “is as close to a free lunch as tax reformers will ever get.”
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If you pay attention to the news, you have heard Warren Buffet claim that he pays a lower tax rate than his secretary. This pronouncement has prompted President Barack Hussein Obama to propose new taxes, affectionately nicknamed “Buffet taxes” or the “Buffet Rule.”
The “Buffet Rule” is going to get a lot of press attention in the coming weeks and it will get more attention if Mitt Romney successfully wins the nomination of the Republican Party.
At this writing, Mitt Romney is running for the Republican nomination and at some time he is probably going to have to divulge his finances more fully than he has already. Mr. Romney doesn’t appear to have a wage-earning job, therefore, his daily spending on clothes, food, mortgage, and hair-styling products comes from interest, capital gains, or dividend income from his earned fortune. It appears that Mr. Romney paid less than 15% on his income where a wage earner would pay a much higher rate.
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Now that it appears that the Democrats and Republicans agree on how to increase our US deficit by $500B-$1T, it is time to talk about throwing out the old tax code. With the passing of the unemployment extension, the Bush tax cuts and other deficit growing measures, we have succeeded in making our tax code even more unwieldy and unfair.
Eliminate the loopholes and eliminate the tiered system. Make it fair and make it easy. Here is a great video explaining one way that this might be possible.
President Barack Hussein Obama has been talking about his new plan to invigorate the economy and move us out of a double-dip or very long recession. I have to admit that I am confused by his logic.
First, a bit about myself. I hate taxes. I know that I need to pay them. I know that I make a good living (not from this blog mind you) and I need to pay into the system more than some others that don’t work as hard as I work. I get all of that.
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