Letter 2 America for December 31, 2015

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Dear America,

We are coming up on the end of another year, and after at least fifteen years of partisan, internecine political maneuvering, we, the American people, don't seem any closer to rectifying the dysfunction than we have been for the past decade and a half.  We continue to be encamped ideologically, and I must confess that I am no closer to voting to accommodate those of the opposite camp than they are to voting to accommodate me.  Frankly, I don't know where it will ever end, or even if it ever will.  The Republicans continue to take positions that seem inimical to the life, liberty and happiness of the vast majority of us, Republican and Democrat alike, but the party loyalists insist on putting party affiliation before reason.  For example, American corporations continue to ship our jobs over seas and the consequence is an employers labor market, which in turn keeps wages down.  The solutions are few, but simple.  First, tax profits taken by American corporations abroad.  Second, impose tariffs on goods imported to this country, even if they are made by American companies.  Third, disallow deduction of labor costs if they are incurred overseas.  Fourth, we can eliminate the R&D tax credit.  Note the word credit...not deduction, but credit.  Corporations that engage in research and development can deduct their expenses, just like any other expenses: payroll, advertising, improvements of physical plant and the like.  But in addition, they can take a portion of their R&D costs off their tax liabilities as well.  In other words, they get to double dip on some of their R&D expenditures by subtracting them from income before calculating their tax liabilities, and then subtracting a portion of them again after that calculation from the amount of taxes they owe.  An analog for the individual might be that if you pay medical expenses in excess of 7.5% of your adjusted gross income (you used to be able to deduct everything over 3%, but St. Ronald increased it to 5% in 1982 and in 1986 to 7.5% when he supposedly gave us all tax relief in what he called "a second American revolution") you get to deduct all or some of that overage from your adjusted gross income before figuring your tax.  But if medical deductions were treated like R&D expenses, you would then be able to subtract some of that deduction from your tax bill as well.  You would get to reduce your tax liability in two ways instead of just one, but no one is proposing that we individuals get such a boon...only corporations, and according to the IRS, mostly corporations with $250 million or more in gross income...the big guys.  We little guys get bupkis.  And last, but certainly not least, we could treat capital gains like ordinary income and get rid of the deficit right quick.

With just those measures, we could balance the federal budget, begin paying down the national debt, specifically the debt owed the Social Security and Medicare trust funds, and reductions of benefits would be obviated for even longer than the two and a half decades for which the Social Security Trust is currently funded.  The value of the  American worker would be enhanced, and as a result, many of those jobs delegated to foreign labor forces would come home, maybe even making the minimum wage unnecessary as we approached full employment because workers could command more pay.  There will always be a need for a minimum wage to protect workers in the service industries--$15.00 an hour in todays currency at least--but otherwise, the market itself might bring workers to the point that one job per household would be enough to provide what was needed to at least stay out of poverty.  In addition, we could stop letting hedge fund operators pay only 15% income tax and make them pay what the rest of us pay on what we take home, and we might generate enough of a surplus that we could actually begin to relieve the tax burdens of us ordinary Americans.  All of that together is nothing short of leveling the playing field so that the rich are less powerful and the rest of us at least can live decent lives in peace in exchange for the wealth we generate for the lucky few.  It all seems so imminently fair...and obvious...that I don't know why we American voters don't see it and insist that our politicians act on the inequity in our division of wealth in these ways, or even in some others.  But instead, we keep electing the same people who keep doing the same things.

I used to tell my kids when they were little that mistakes were like sticking your finger in a fan.  If you are at all reasonable, you don't stick your finger in it a second time.  But the way in which our government--currently dominated by conservatives, and Republicans in particular--operates, we are guaranteed to be required to keep swimming upstream for the rest of our lives.  To put it concisely, allowing conservative Republicans to prevent a progressive course for our nation--and when not in the majority, they did so with procedure even when they were in the minority, at least until recently--is like a whole nation sticking its collective finger in a huge fan...over and over again.  But it's about to be 2016, and we get another shot at it.  Maybe the majority of us will see to the heart of all this by November and turn it off instead.  Happy New Year...I hope.

Your friend,

Mike

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This page contains a single entry by Michael Wolf published on December 30, 2015 1:33 PM.

Letter 2 America for December 24, 2015 was the previous entry in this blog.

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About this Entry

This page contains a single entry by Michael Wolf published on December 30, 2015 1:33 PM.

Letter 2 America for December 24, 2015 was the previous entry in this blog.

Letter 2 America for January 7, 2016 is the next entry in this blog.

Find recent content on the main index or look in the archives to find all content.

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