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Posts Tagged ‘consumption tax’

Printing Money Won’t Help

My letter to the St. Petersburg Times was published on Sunday, August 14th.

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Enough With the Economic Stimulus

Here is a letter to the St. Petersburg Times:

The case for “a massive stimulus” is extremely flawed (Think big on economy, August 11).  We’ve tried this same approach in perpetuity, hoping for different results.  The rationale put forth echoes assertions like, ‘the other stimulus wasn’t large enough.’  It didn’t work for Herbert Hoover or FDR, nor has it worked for George W. Bush and President Obama.

Recklessly printing money coupled with “serious tax hikes” will not increase economic output, or create jobs.  Accelerating the rate of growth of inflation is the only outcome of major stimulus.

The mechanism for creating jobs and increasing economic growth is to provide a level playing field, with certainty in the marketplace.  If the federal government truly desires to tackle our economic woes, it can start by eliminating the income tax on individuals and corporations, and replacing it with a consumption tax.

This simple measure will instantaneously create jobs and increase the rate of growth of investment and savings without eliminating the social safety net for those truly in need.

Sincerely,

Craig D. Schlesinger

Economy Takes Center Stage

My letter to the Los Angeles Times on creating jobs by eliminating the income tax and implementing a consumption tax was published today.

Focus on Jobs by Eliminating the Income Tax

Here is a letter to the Los Angeles Times:

President Obama recently declared “it was time again for Washington to focus on jobs” (Now, Congress and Obama need to focus on jobs, August 3).  Having already experienced the recent failures of economic stimulus under Bush and Obama, there is a better mechanism for increasing the lackluster growth rate of GDP and job creation – eliminating the income tax on individuals and corporations and replacing it with a consumption tax. 

Eliminating income taxes will ignite a whole new jobs boom by creating an environment of certainty for businesses, removing the need to seek out loopholes and foreign labor markets.  Corporations will flock to the US, leading to greater competition among industries that will create countless jobs in the process.  

Moreover, eliminating income taxes will increase individuals’ consumption, investment, and savings, resulting in an improved rate of economic growth.  Due to the ensuing rise in consumption, sufficient tax revenues will be collected to fund the federal government.  Most importantly, the removal of unfair tax advantages to politically well-connected corporations, individuals, and interest groups will create a level playing field and certainty for all market participants – fostering and encouraging economic activity.    

Sincerely,

Craig D. Schlesinger

More Taxation is Not the Answer

Here is a letter to the Chicago Sun-Times:

In the wake of the recently passed debt deal, the Chicago Sun-Times asserts, “President Obama’s job is to convince the nation that more tax revenue ­­— not just more spending cuts — must be a part of the two-stage deal”  (Obama must find a way to boost U.S. revenue, August 2).  However, income taxes aren’t the solution, they are the problem.

Simply raising marginal tax rates will accomplish nothing, since tax revenue as a share of GDP is historically 18-20% regardless.  Our lackluster revenue and economic output is due to unemployment, and the best way to foster job growth is by eliminating all income taxes on individuals and businesses.  If the US taxes consumption rather than income, a whole new jobs boom will begin instantaneously.

Absent an income tax, businesses will exist in an environment of certainty without the need to seek out loopholes and foreign labor markets.  Moreover, corporations will flock to the US, firm in the knowledge that this is the best country to start-up and grow business.  As industries realize an influx of new competitors to innovate, countless jobs will be created in the process.  Certainty for business translates to stability for individuals and a prosperous society for all.

Furthermore, individuals gaining the freedom to increase their consumption, investment, and savings will result in an additional uptick in economic output.  Since the wealthy account for the largest block of consumption, they will indeed pay their “fair share” of taxes.  Eliminating the income tax and replacing it with a consumption tax will also remove unfair advantages to politically well-connected individuals, corporations, and special interests – providing a level playing field for all market participants.  How does that translate to a “kick in the gut to the middle class”?

Sincerely,

Craig D. Schlesinger

Wealth Redistribution Does Not a “Capitalist” Make

Here is a letter to the Sun-Sentinel:

Brian E. Little needs to brush up on his economics and American history with respect to taxation and the policies of Alexander Hamilton (Redistribution of wealth is good for social stability, August 1).  Although Mr. Little asserts wealth redistribution “protects capitalism, wealth and workers,” there is no greater threat to a vibrant free market economy than a progressive income tax.

Invoking Alexander Hamilton, Mr. Little seeks to make a champion out of possibly the greatest stain on American economics.  Hamilton is the original top-down central planner in America, whose First Bank served as a template for the Federal Reserve – two organizations antithetical to the principles of free markets.  His policies of accumulating and consolidating debt to establish American credit set a dangerous precedent that currently finds us in a $14.3 trillion hole.

Furthermore, progressive income taxes restrict economic liberty and stifle growth – contrary to Mr. Little’s claims.  Taxation based on consumption proved the best mechanism for enhancing wealth and providing certainty to markets so all could prosper, as inflation was essentially zero from 1783 until 1913.  Is it any coincidence that the value of the dollar is on a steady decline since 1913 – the year the income tax became a permanent fixture in the tax code and the passage of the Federal Reserve Act?

If Mr. Little is so certain that Hamiltonian central planning, redistribution of wealth and progressive income taxes are good for business, social stability and national security, then why is the nation teetering on all fronts?

Sincerely,

Craig D. Schlesinger

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