In the past, readers of this column received reports about the real causes underlying the problems affecting the credit markets, the housing situation, the general economy, and more.
But, during that time, instead of taking appropriate action to lighten both the tax and regulatory burdens on job-creating businesses, political machination was the choice of the Administration and Congress. As a result, trillions of taxpayer dollars have been wasted on stimulus packages and government intervention into what is supposed to be a private, free-market US economy.
Now, Washington incumbents are talking about yet another stimulus package.
Make no mistake: What is being planned is one giant political earmark targeted to keep unionized public employees collecting paychecks beyond the November elections, while also subsidizing state spending programs that are long overdue for review and either cost reduction or cancellation.
Such an approach is not a fix. Nor is it an innovative idea. Simply put, it is politics as usual.
For many months, we urged readers to stop unnecessary personal spending and increase savings: immediately and persistently.
That is what individuals should be doing, and it’s what the government should be doing.
Government at all levels must go on a diet voluntarily; or be put on the strictest of diets by taxpaying citizens.
Specifically, the stimulus Americans need is across-the-board cuts in all tax arenas: payroll, income, dividend, capital gains, inheritance, as well as sales, excise and fees.
That is the best way to stimulate both the general economy and every individual citizen’s personal economy.
The feds must cut payroll taxes for individual wage-earners — all employees. Pick a percentage for your own thought process here.
Want to throw a bone to Washington politicians and controller-types populating federal bureaucracies? Let them decide whether to cut the employer side of payroll taxes. If they don’t that tells us they are not fully cooperating. Personally, I would cut the employer side by the same percentage. And perhaps tie it to reinvestment in hard assets that support job growth inside a domestic company, or, alternatively, specific new employee job slots for citizens.
That would not be hard for government to track at all. It would give government workers something to do: track how many employee Social Security numbers each company has.
Want bureaucrats to control it further?
Have the company declare specific new employees as “reinvestment job slots” periodically. That would give government workers more to do.
You might say, “Wait just a moment, Rich. There are too many government employees. We could insist government use computers to do the tracking.”
And I would respond, “You’re right. It would take just seconds to do the same thing using computers!”
You get the picture.
As for state governments, consider the following:
What would happen to your personal purchasing power if either the feds or your state government — or both — would cut, drop, or even suspend gas taxes?
Nationally, the combined burden of federal, state and local gas taxes costs American drivers an average of 45.9 cents on every gallon purchased, according to data from the Tax Foundation. Using this data, the federal tax on each gallon is 18.6 cents per gallon, so the average state tax added to each gallon is 27.3 cents.
How much tax does your state add to the per-gallon cost of gasoline? Check into it. You likely will be shocked.
And be aware that many state officials are now “working the public” to accept even higher state taxes on gasoline. Have you heard or read media reports about that in your state?
So, if you need personal motivation, imagine the sound of all those quarters returning to your pockets after each fill-up.
We can cite more examples, but taxpaying citizens get it. Government spending is excessive and must be cut back…way back.
In summary, each of us can stimulate our personal economy by taking action now “cold turkey” to rein in personal consumer spending, increase personal savings and pay down existing personal debt.
Citizens can help each other and our country by insisting that government at all levels immediately go on a diet…because government is obese.
There are two aspects to the diet required for government: shedding spending and reducing taxes.
The feds can start by cutting payroll taxes. States can start by cutting gasoline taxes.
Indeed, this is a better stimulus.
Still think you have a viable alternative?
The politicians may not want to hear either yours or mine.
You’ve heard mine; I’ll listen to yours.
Richard Olivastro is president of Olivastro Communications; a professional member of the National Speakers Association; and, founder of Citizens for Change. He can be reached via email: RichOlivastro@gmail.com or by telephone at 877.RichSpeaks.