Recession-Depression Fed-Gov Stimulus Solutions

In response to an article published by Edward Harrison:

Recession Is Over; Depression Has Just Begun

http://seekingalpha.com/article/164452-recession-is-over-depression-has-just-begun?source=article_sb_popular

There are numerous systemic problems with the all of the "systems", which limitations are built into their core foundations. Here are some ideas to remedy these problems.

1. Tax consumption rather than income, savings, investment and business profits. Everyone consumes, everyone pays. It works for nine (9) states with no personal and low business income taxes (TX, FL, NV, TN).

2. Shrink the IRS from over 150,000 employees to 15,000. The IRS employs more people than the 25 largest corporations in America. They just chase money from people who try to avoid paying taxes.

3. Reduce the $10 billion annually needed to operate the IRS,

4. That will also drastically reduce the $250 billion annually it costs to complying with the tax code. Massive amounts of our national wealth are consumed merely by measuring, tracking, sheltering, documenting, and filing our annual income.

5. Instead of the US Gov revenue looking like this:

     Individual income taxes: 50.4%

     Payroll taxes (FICA): 31.4%

     Business income taxes: 14.6%

     Excise+ other taxes (tobacco, gas, etc.): 3.6%

It would look like: VAT/sales tax: 99%

All Financial Transactions must be taxed as well.

6. Instead of worrying about where the increased taxes will come from to repay the debt, it will automatically happen when sales and wealth increase; which it will.

Currently from the IRS website here is the breakdown of taxes:

     50% of taxpayers pay 96% of all taxes

     5% of taxpayers pay 54% of all taxes

     1% of taxpayers pay 34% of all taxes

The current system must rely on those top 10% of taxpayers to support and to pay off the debt; and that is a bad bet.

7. Fed Gov (and hopefully the legislature) must make investments and establish policies that have:

     a) immediate impact on jobs/products

     b) long term future benefits

Some examples might be:

(1) Renewable energy on site: solar panels last 25+ years generating electricity. Current payback is 10+ years, but if manufacturing and R&D were "subsidized", costs could drop just like computer costs.

(2) Provide tax credits and SBA loans for renewable energy product manufacturing. We need to create more jobs in a new industry. We do not need more service jobs, we need product manufacturing jobs.

(3) Until the tax code is fixed, give tax deductions and credits for buying renewable energy products, including electric cars. Make it available to businesses.

(4) Buy renewable energy products for DOD, including building improvements, electric vehicles - train DOD to install, support and service all products. Most of DOD is support, not fighting.

(5) Provide tax credits for all Green Building. Change commercial and residential building codes to require Gold/Platinum Green Building standards. It will increase the cost of the buildings, but reduce our overall consumption of energy and water. It will re-stimulate a new sector of the economy for building. In TX our electric bills can hit over $500/month, so if that were reduced to $100/mo it means real cash savings, less new electrical transmission, less electrical generation, reduce CO2 emissions (less coal, less natural gas).

(6) Require all detention facilities to be self-sustainable (energy, water, food). Use GSA project managers to identify solutions and manage implementations. Use local companies for construction.

(7) Fund building of new reservoirs, and dredging older ones

(8) Increase funding/projects for Public County Health facilities - use "Green Prefab" medical buildings to replace, add-on, or create new facilities. Plan for 50-100% increased patient load.

(9) Fund replacement of pubic transportation to electric vehicles. Smaller, lighter. Provide grants for new public transportation services using electric vehicles.

(10) Convert USPS vehicles to electric power.

The executive branch of the government is the nation's largest employer. It owns and manages the most buildings/facilities. It has the largest fleet of vehicles. Once it mandates "green building" and "electric vehicles" - all purchasing will begin requiring those products, which directly stimulates new business, new products, innovation, more services, etc. The direct benefits are lower cost of ownership, meaning lower operating costs. Let the government be the test case and provide the funding.

I believe these are concrete examples of how the Fed can turn this economy around, and they could begin in 90-days.

It would only take 30-days to produce the executive order letter. Then people would see hope...

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in response to article:

On Oct 02 03:50 PM Socialism cannot compete! wrote:

I wholeheartedly agree with the conclusion (depression vs. recession), and that too much debt (both personal and governmental) is the factor that will prolong and deepen this situation.

However, debt is not the root cause, but a symptom!! It is a symptom of too-large government, and the resulting tweaking of the system to allow for excess debt; the lack of personal responsibility caused by entitlements encourages free spending with the thought that the basics are taken care of in any case; the excessive, onerous, and immoral level (and type/mode) of taxation to pay for such entitlements also deprive the producing segment of their just fruits and encourage a psychology of futility -- the notion that it is futile to be able to wait, save for "it" (whatever "it" is), and buy a bit later on savings, since net income does not allow for that -- too much of the earnings are gone to pay for large bureaucratic government and entitlements.

Hence, the lower class lives off entitlements and spends freely, being unafraid of debt and knowing how to game the system; the middle class says "to hell with it", I'm not gonna save 2 years before getting the big screen, or 10 more years before buying a home; and the upper class, being taxed at massive rates has incentive only to look for loopholes and shelters.

The root cause is government that is *far* too large, and well beyond its just purpose...well beyond what is *good* for free market economics...and well beyond what is allowable by a free people. And the unjust tax scheme(s) that pay for such is costing us both our present AND our future!!

There are no shortcuts to prosperity: personal responsibility and real freedom beget prosperity...the lessening of them lessen the opportunity to do so. Take back control of YOUR income and property rights:

fairtax.org