While I do not support all the points of view in this post, I do find it a pretty clear reality check and agree with the premise that we need a multi party system rather than our two party system. The revenue source and expenditure graphic at the start of the post is from official budget numbers and does not address the activities of the Fed, which will soon come to more light, or the shadow activities of the Treasury, which claims to have made a profit on TARP, no mention being made of the many banks that are not even paying their TARP Preferred Dividends. Who is trying to collect on those by the way? It smells of a propping up operation. That is enough to tell you that the books are cooked. We do need truthful leaders to address real issues.
In my prior post I linked an article pointing out that multinational companies are not paying their share of taxes. In this linked post, the suggestion is make that Marijuana be legalized and taxed heavily. Illegal drug sales are just one part of an underground economy that does not pay its share of taxes. That puts the narco industry on par with Exxon Mobil. Neither pay their taxes. Not being a tax expert, I don’t know that a VAT is the best solution, but it is from a category of solutions that increase the tax base. That must be done. Hedge Fund managers, multinationals, drug pushers, cash intensive businesses, and general tax cheats are screwing the rest of the tax payers and primarily W-2 employees that are already squeezed. So let’s get a share from everyone by revamping the tax system.
I like John Hussman and agree with both these ideas:
John Hussman had a creative solution to help the housing market. He came up with this idea in October 2008. Of course, the Bush and Obama idiots would never consider such a logical solution:
- Congress can efficiently mute the impact of the mortgage crisis on “Main Street” by allowing a small change in foreclosure law. Specifically, in foreclosure proceedings, judges should have the ability to reduce the amount of principal on a mortgage loan, provided that the original mortgage lender receives a “Property Appreciation Right” or “PAR” from the homeowner. The PAR would be an obligation to repay the mortgage lender out of future appreciation on the home (including property subsequently purchased, until the obligation was relieved). Payment would occur either when the home was sold, or through an equity-extraction refinancing at some later date. In that way, homeowners would surrender some amount of future appreciation in return for an equivalent reduction in the mortgage principal. This would result in an immediate lowering of mortgage payments, yet the original mortgage lender would still stand to be made whole. To account for time-value, the amount of the PAR obligation could be allowed to increase at a small rate of interest. The homeowner would be able to keep the house. Importantly, there would be no need to continue major write-downs on mortgage securities, since only the character of the payments, not the value of the mortgage obligation itself, would change.
John Hussman has a fantastic idea regarding Social Security. This idea would benefit the working class and stick it to the rich. ”Drop the rate substantially, but include all income – wage and non-wage. Three-quarters of Americans pay more in payroll taxes than in income taxes. By reducing the wedge between the hourly amount earned by employees and the hourly cost paid by employers, this strategy would create immediate incentives for employment. Moreover, it would raise more revenue because at present, even Warren Buffett only pays Social Security taxes on the first $106,800 of income.” This idea would be an immediate boost to the economy as the average worker would take home more pay. Revenue from Social Security would increase by $200 billion.
On this one we do need to calculate a break-even point of income and make sure that it is not a tax increase too far down the economic continuum. That Social Security is a savings program is simply a fraud. So while some years ago I would not have supported decoupling payments from individual taxes, now is the time to do that.