Economic Solutions Thread

[PtldPlatypus]

We're all great at listing things that we think contribute to the down economy; how about we have a thread dedicated to various ideas on what could improve it?

My thought--for any "idea" post, list a significant issue that affects the economy and your idea for some solution that might help address that issue. Let's try to keep it to a single idea per post, for simplicity's sake. Then for any subsequent posts discussing the merits of a particular idea, try to also suggest what you think would be better, rather than just critiquing the initial post. Let's try (as much as possible) to leave partisan bickering at the door.

Anyone care to give it a shot?

 

[PtldPlatypus]

My first "idea"--I think consumer debt is a huge problem. I think financial institutions have too much incentive to promote consumer debt, and consumers perhaps need some more assistance in addressing the problem.

What if we had a "reduction deduction"--so that reduction in a consumer's overall debt load could be deducted from taxable income? Obviously, it would have to be a multi-year measurement to prevent someone from running up a ton of debt at the end of one year to then pay it off at the beginning of the next. And it would have to not apply to corporations, because it's often good for the economy for them to carry debt. I'd also suggest legislation to significantly reduce the fees that lenders can charge on debt, since those seem to exacerbate the problem.

Thoughts?

 

[magnifier661]

That's a good idea. Some sort of tax relief for those reducing their leveraged investment. Maybe some sort of tax incentive for being in the certain debt to income ratio. Seems like a complicated process though.

 

[PtldPlatypus]

Another idea--and please pardon me if my admittedly rudimentary understanding of economics is completely bass-ackwards on this. If the economy benefits from money moving around, then does that mean that corporations who hoard liquid assets are hurting the economy (as well as themselves by not using their assets to earn a return)? Would it be possible to have an additional corporate tax on year-over-year increases in cash on hand? What would be the negative repercussions of something like that?

 

[Mediocre Man]

[video=youtube;3iGm4dl0Ys4]

Bill Burr has a great idea. Probably half way through this, but do yourself a favor and listen to the whole thing

 

[magnifier661]

My idea is to find a program that can earn or have benefit for all income levels. My proposed program would be a tax deduction schedule that gives an updated grouping of write offs; used for purposes of investing (be it housing, stocks or small businesses).

I would target personal item write offs that every income level can take advantage of. It would have to be items that can't be easily "fudged" or "abused" like loan principle % write off. This % can reflect income scale; which would go towards the left wing philosophy of more incentives for the poor and less for the upper income bracket. Maybe a sliding scale of 10-30%. Insted of just being able to write off the mortage cost of a loan; maybe a certain portion of the principle can give credit to the individual.

Example 1: Let's say Joe Smith, who earns 80k per year, buys a house. He has 100,000k saved for a down payment. If he puts all 100k into the down payment; 10% of that principle payment can be written off his income tax (10,000). If he makes 80k per year; that's a tax savings of $2,000. It would be an incentive for Joe Smith to add more of his savings towards the principle; which can boost the deduction of perpetual debt. Also, if more people are more invested into a house or business; they are more unlikely to default on their loans. This could create a chain reaction of housing cost inprovements.

Example 2: Let's say Jane Doe, who makes 25k per year, doesn't have 100,000k to put down on the house; but is able to afford $200 extra per month payments (towards principle). She would be able to put in $2,400 towards the principle tax credit of 30%. That would be a tax savings of $720.

Win win for both the rich and lower class.

 

[magnifier661]

Another idea--and please pardon me if my admittedly rudimentary understanding of economics is completely bass-ackwards on this. If the economy benefits from money moving around, then does that mean that corporations who hoard liquid assets are hurting the economy (as well as themselves by not using their assets to earn a return)? Would it be possible to have an additional corporate tax on year-over-year increases in cash on hand? What would be the negative repercussions of something like that?

Well corporations are taxed on left over equity; like inventory. Liquid money is needed for a fiscal company. There are dark days that the corporation I work for was so happy they had liquid reserve; because our sales dropped 30% for 6 solid months. Our budget had a 12% net income; and losing 30% in sales actually had us in the red for those 6 months. Without our cash reserve; we would have had to make drastic cuts to stay in business.

That means many people would have lost their jobs or we couldn't take advantage of inventory purchases for the entire year for a discount.

 

[PtldPlatypus]

Well corporations are taxed on left over equity; like inventory. Liquid money is needed for a fiscal company. There are dark days that the corporation I work for was so happy they had liquid reserve; because our sales dropped 30% for 6 solid months. Our budget had a 12% net income; and losing 30% in sales actually had us in the red for those 6 months. Without our cash reserve; we would have had to make drastic cuts to stay in business.

That means many people would have lost their jobs or we couldn't take advantage of inventory purchases for the entire year for a discount.

Oh, I'm not saying that companies should not have any cash reserves, but there's a point at which they're no longer truly beneficial. Maybe if there were a % of assets line over which liquid reserves would be taxed, or something like that.

 

[PtldPlatypus]

[video=youtube;3iGm4dl0Ys4]

Bill Burr has a great idea. Probably half way through this, but do yourself a favor and listen to the whole thing

I think I missed it. What were you talking about? Auditioning to keep your job? Reinstating bullying? Telling people what to invent and locking them in a room until it's done? Help me out here...

 

[BLAZER PROPHET]

1) Balanced budget. No exceptions, period, except for times of war.

2) Replace the individual income tax with a flat tax. No deductions of any kind. Whatever money from work comes to a person, gets taxed at the same rate.

3) A 5% national sales tax with every penny going against the national debt until it’s paid off. Then the tax is eliminated.

4) Defense- cut 60% via attrition.

5) Medicare- Aggressively go after fraud and make the punishment so severe, no one will want to try.

6) Social Security- eliminate all forms of SSI for what people do to themselves (booze, drugs, over eating…), review all other reasons why people can get this and make it be better proven. Make penalties for all involved very severe. Then, increase retirement benefits a bit.

7) Obamacare Tax Plan- repeal. Keep better parts and then have a more realistic heal plan.

8) Legalize and tax marijuana.

9) A careful review of every social program for 35+% cuts and increased fraud investigation.

10) Reduce taxes on American investments to 10% if held for 2 years, 5% if held for 4 years and 0% if held for 6 years+. Offer this for a buy in period of 4 years to bolster investments in US companies.

11) Allow startup companies to be free of union take over for a period of 15 years so they can build a solid base and eliminate unions in companies of less than 50 employees unless ownership approves. HOWEVER, those companies must pay a minimum of 90% to union scale.

 

[barfo]

Your ideas are intriguing to me and I wish to subscribe to your newsletter.

barfo

 

[Mediocre Man]

I think I missed it. What were you talking about? Auditioning to keep your job? Reinstating bullying? Telling people what to invent and locking them in a room until it's done? Help me out here...

Auditioning to keep your job. His plan is for 1/3 of the American population to walk into the ocean

 

[Denny Crane]

Companies accrue cash for good reasons. Like to fund expansion, to acquire complimentary businesses, or to smooth out cash flow between good and slow times.

I cannot think if a good reason to take their capital. Nobody else, period, will put it to better use.

 

[magnifier661]

1) Balanced budget. No exceptions, period, except for times of war.

2) Replace the individual income tax with a flat tax. No deductions of any kind. Whatever money from work comes to a person, gets taxed at the same rate.

3) A 5% national sales tax with every penny going against the national debt until it’s paid off. Then the tax is eliminated.

Numbers 2 and 3 would be the biggest turn around for this country. I've alway been a supporter of the nationwide "flat-tax" plan. That program would eliminate the multi-trillion dollar yearly expense of the IRS. You could cut back about 70-80% of that department for regulation of the flat tax.

The federal sales tax is another great idea trimming the national debt down quickly!

 

[PtldPlatypus]

Companies accrue cash for good reasons. Like to fund expansion, to acquire complimentary businesses, or to smooth out cash flow between good and slow times.

I cannot think if a good reason to take their capital. Nobody else, period, will put it to better use.

OK, if the consensus is against me, then I'll rescind that one.

 

[BLAZER PROPHET]

Numbers 2 and 3 would be the biggest turn around for this country. I've alway been a supporter of the nationwide "flat-tax" plan. That program would eliminate the multi-trillion dollar yearly expense of the IRS. You could cut back about 70-80% of that department for regulation of the flat tax.

The federal sales tax is another great idea trimming the national debt down quickly!

Did I also mention making breast implants for beautiful girlfriends tax deductible?

 

[magnifier661]

Did I also mention making breast implants for beautiful girlfriends tax deductible?

ZIIIIIIING!!!!!!

The tax code is "MakeTheWorldSexyCode 301.23.567 DC"

 

[bluefrog]

Tax long-term capital gains and dividends at the same rate as regular income and eliminate the corporate-income tax.

 

[BlazerCaravan]

http://www.dolekemp96.org/main.htm

 

[Eastoff]

[video=youtube;3iGm4dl0Ys4]

Bill Burr has a great idea. Probably half way through this, but do yourself a favor and listen to the whole thing

I didn't like his sense of humor at all. But maybe because I'm a nerd, and he comes across as a bitter jock.

 

[Eastoff]

I'm waiting to hear from our economic powerhouses, BlayerBoy and Maxie!

 

[PtldPlatypus]

I'm waiting to hear from our economic powerhouses, BlayerBoy and Maxie!

That makes two of us.

 

[jlprk]

This is a useful list of upper class fantasies. And perfectly-timed, a week after you lost the election big-time, when the conventional wisdom is that you guys live in your own mythology.

 

[HailBlazers]

We're all great at listing things that we think contribute to the down economy; how about we have a thread dedicated to various ideas on what could improve it? Anyone care to give it a shot?

Network Marketing. It's the cheapest way for each and every american to start their own business. An additional $500 a month for a lot of Americans would do wonders, for them and the country as a whole.

[video=youtube;57WNZVWpwqg]

 

[blazerboy30]

I'm waiting to hear from our economic powerhouses, BlayerBoy and Maxie!

IMO, the three biggest issues facing our economy are:

1) Mental / attitude / entitlement / etc
The mentality in this country has become one of assuming somebody else should or will take care of us, and there is no shame in not taking care of ourselves. We can not have an environment where somebody would actually choose to take what the government is handing out instead of taking a job they feel is "beneath" them. Safety nets are fine, but there has to be strong incentives to get away from taking and depending on government hand-holding.

There needs to be a drastic shift in the mentality of the people in this country or else no other tax breaks or government spending will help.

Related to that, the entitlements in the education sector are out of control. It has gotten to the point where we can't improve our education in this country because the majority of increased funding will go to pensions and waste. We need to fix this so that we can get our non-university education system back to the best in the world. Pensions need to be tied to the markets, just like everybody else. There is no way pension values should be guaranteed value while the private sector is laying off millions.

2) Medical costs

There is a near-inelastic demand function for healthcare. This has lead to skyrocketing costs in the sector. We really need to figure out a way to get the accelerating costs under control while keeping the system in the private sector. These costs are really hurting small and medium sized businesses.

I would propose a couple ideas:
- Make basic, fundamental, catastrophic health insurance available for anybody that truly needs it (making less than $x / year). This can be done for ~$1000/year/person instead of Obamacare's $6000/person/year.
- Tort reform
- Better understand where every dollar of a health / doctor bill is going. We need to understand WHY a night in a hospital costs $15,000. At this point, those of us that have insurance have no incentive to try to get lower prices for healthcare. So we don't care that a doctor charges $400 for a 10 minute visit, or a night in the hospital costs $15,000.
- We should incentivize individuals to negotiate for better prices. Perhaps we can provide a stronger tax break for paying for healthcare costs out of pocket instead of with insurance. I guarantee if people have a reason to shop around, they could see a doctor for less than $400 for a 10 minute visit.

3) EVERYBODY needs to pay state and federal income tax. Every single person needs to have some skin in the game, even if it is a little amount. We've reached the tipping point where the majority can vote to take what they want from the people that have more then they do. If the public wants a service, EVERYBODY needs to feel some consequence of that spending. If we don't implement this, voting for more spending will never stop and the percentage of those voting for services paid by the minority will continue to grow which is unsustainable.

 

[HailBlazers]

There needs to be a drastic shift in the mentality of the people in this country or else no other tax breaks or government spending will help.

Agreed. We need to promote a new form a business, one that each and every American can partake in ie: Network Marketing. It has the ability to take the power away from the Corporations and into the hands of the people.

 

[EL PRESIDENTE]

www.fairtax.org

 

[Denny Crane]

Cut unemployment benefits to 26 weeks. People are able to work, just not willing to work for 25% more income. I have great faith in people, and when faced with being cut off from the govt. teat, they'll find work. If they want higher wages, they'll find a way to earn those, too.

This is not a knock on anyone - it's human nature. Some may not make it, and that's what welfare is for.

I like the skin in the game suggestion. I also think they should raise or lower everyone's taxes so we all feel the pain or benefit.

Obama is too hostile to business. The pipeline is a perfect example. Jobs killed. We are no less dependent on A-rab oil. It would be good for business. Just a visible example... His cronies at EPA and every other regulatory body "legislate" against business constantly.

Shrink the debt to what we owe for money spent to build roads, bridges, or other infrastructure. Only borrow for these things.

 

[Mediocre Man]

Here are a few radical ideas

Eliminate the penny. While it is still cheaper to make 5 pennies instead of 1 nickel, pennies do cost more to manufacture than they are worth. The US made approximately 5 billion pennies last year, so eliminating that would save the country a little more than that each year.

Staying with my penny theme, businesses would be required to raise prices to accommodate sales tax so pennies were not needed. The bump in price would be used for hiring workers, with a tax break for doing so

Legalize marijuana and tax the shit out of it. Apply the same tax to tobacco and alcohol. Also set a minimum health label on foods, with companies forced to pay tax on anything that comes in above that

Only borrow money for infrastructure

Make social security a private business. Eliminate the social security admin and save billions (not sure how to transition that one)

Place all convicted rapists, murders and other lifers on an island and let the people of the US pay per view to watch real "survivor"

 

[BlazerCaravan]

Here are a few radical ideas

Eliminate the penny. While it is still cheaper to make 5 pennies instead of 1 nickel, pennies do cost more to manufacture than they are worth. The US made approximately 5 billion pennies last year, so eliminating that would save the country a little more than that each year.

I never really understood this argument; pennies are used more than once, so their cost being more than their value is kind of a moot point, right?

Staying with my penny theme, businesses would be required to raise prices to accommodate sales tax so pennies were not needed. The bump in price would be used for hiring workers, with a tax break for doing so

Not a huge fan of sales taxes as they seem to target people whose savings rates are the lowest (not intentionally, but rich people aren't rich because they spend all their money, yeah?). But really a sales tax would only change the world in Oregon, so I guess we could just get with the times...

Legalize marijuana and tax the shit out of it. Apply the same tax to tobacco and alcohol. Also set a minimum health label on foods, with companies forced to pay tax on anything that comes in above that

I can dig this idea. Even if MJ was taxed as much as cigarettes are, it'd still be way cheaper than the standard "hookup" price from a dealer.

Only borrow money for infrastructure

As long as defense spending doesn't get bucketed in as infrastructure through loopholes.

Make social security a private business. Eliminate the social security admin and save billions (not sure how to transition that one)

The welfare of mankind is not in private business's wheelhouse. Inclusion is not their strength; exclusion is. I'm not sure I want to rely on a business that sees me as a cost center for my safety net.

Place all convicted rapists, murders and other lifers on an island and let the people of the US pay per view to watch real "survivor"

Part of me wants to be more savage: maximum sentences of 10 years for non-violent crime. Any violent crime with a conviction and two lost appeals (trying to avoid frying the West Memphis 3) would result in capital punishment.

Part of me wants to be less savage: maximum sentences of 10 years for non-violent crime, 20 years for violent crime. A lot of good money goes after bad housing criminals for so long.

At the same time, those are private sector jobs in a "Big Prison" market with a huge lobby. Where are all those not-good-enough-to-be-a-cop folks going to get their jobs after half the prisons close? Those folks are on the cusp, with low education levels and no other marketable skills.

There are a lot of private industries that are being paid for by the government, lots of fools gold employment out there if government were to shrink to the point of being unable to pay them. No matter who started that expansion, we're living with the effects now.