Saturday, November 14, 2009

“Mr. Obama: Tear Up Your ‘Stimulus Package’!”


 The Berlin Wall fell 20 years ago which liberated Eastern Europe from centralized planning and control (sound familiar?).

President Obama has announced a ‘jobs summit’ to be held at the White House later this year.  We think it is painfully clear what needs to be done to create the millions of jobs we all want and need here in America:  “Tear up the rest of the first stimulus package!”; don’t spend any more money on the TARP program and cut corporate income taxes in America to zero.

Perhaps a brave staffer at the White House will send the following memo along to President Obama:

“Mr. President:

Calling for an economic ‘jobs summit’ at the White House next month is not going to create any more jobs just because you say so.  You are a great orator but you can't just speak and create jobs out of thin air.

Your economic stimulus package has failed to stimulate anything, no matter how much spin your press office puts on it.  It did save teachers jobs in states such as California that were under tremendous financial stress and might build some new bridges and roads over the next several years. However, most businesses are sitting tight on their cash and not expanding or creating jobs due to all the uncertainty out there today.

Government can not ‘create jobs’ any more than it can ‘create wealth’. It can only redistribute wealth already created by the private sector first.

This economy needs an economic jolt unlike any other we have seen in modern times so that business people will be energized, motivated and incentivized to make the capital investments necessary to expand their business which will create the jobs we all want and need right now.

To do that, we suggest the following, bold and yet disarmingly simple solution:

-Eliminate the corporate income tax code from American business.


There. We said it.  Millions of jobs will be created from 2010 to 2012 and you will be re-elected in a landslide of monumental proportions akin to President Reagan in 1984.

Without the onerous yoke of corporate income taxes on American business to pay, corporations with hundreds of thousands of employees on down to companies with only 10 people will see a magnificent window of opportunity open up before their every eyes to expand their businesses and make more money for their stockholders. After all, Mr. President, that has been the primary objective of any profit-making entity since the dawn of time.  Without making a significant profit, there is no reason for any sane person to invest their capital and take the risks necessary to bring a service or product to market.

Once they see that, they will start hiring people right and left and drive the unemployment rate back towards zero where it belongs.

Corporations do not pay taxes; people pay those taxes.  They pay them in the form of higher prices for goods and services each time they consume them.  Consider this a secondary tax cut for 310 million of your fellow citizens, 200 million or so of them who are registered to vote either for you or against you in 2012.

Cancel the rest of the first stimulus package, of which close to $400 billion remains yet to be spent on infrastructure projects. When Mr. Gorbachev allowed the Berlin Wall to crumble in 1989 without a shot being fired, even they recognized that old-style, centralized, top-down government spending programs do not work to create the jobs and lifestyles everyone wants in today’s world.

By repealing the first stimulus bill, and canceling what is left of the TARP package, we could eliminate the corporate income tax and not affect the future budget deficits at all. This approach would cost far less on an annual basis that all of the plans you have put forward so far, like maybe 70% less.

Did you hear that India recently purchased 200 tons of gold which is driving gold prices through the roof?  (see Indian GoldLike the Chinese, they are growing increasingly more concerned that the US does not have a grasp on its economic situation (we don’t) and that the dollar will continue to fall in value.

Mr. President:  All we can conclude with is this statement:  If you and Congress passes nothing else but this one single one sentence bill tomorrow, all of this economic gloom-and-doom will evaporate into a morning mist of fresh air optimism immediately.

Do it for yourself, if you want to get re-elected.  But more importantly, do it for your country.  That is what you were sworn into office to do anyway, sir.”

Respectfully submitted,

Telemachus"

2 comments:

  1. according to OMB, corporate taxes will bring in $174 billion in FY2009 (down from over $300 billion in 2008). If I'm not mistaken, thats just about what is in the 'unborrowed, unborrowed" ; TARP account. It's a fine idea, but frankly, in a $14 trillion economy, $174 billion wont make much of a difference as stimulus. I wonder what the take is on capital gains (not that anyone has any gains), or the taxation of dividends and interest?

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  2. Exactly! When has a government ever spent its way into prosperity? Mr. Obama, please study history and take note of what nations have prospered, when they've prospered and what characteristics are constant of such. Socialism DOES NOT WORK.

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