One simple tax cut to grow the economy & shrink the rich/poor Gap

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It takes only two things to keep people in chains:
The ignorance of the oppressed
and the treachery of their leaders.

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The following should come as no surprise to you who see news from other than Breitbart and FOX:

Why the GOP Tax Bill Is So Unpopular
The Atlantic • November 25, 2017

President Donald Trump says he doesn’t want to cut taxes on the rich. His Treasury Secretary Steven Mnuchin said he doesn’t want to cut taxes on the rich. The Democratic Party says they don’t want to cut taxes on the rich. Americans say they don’t want to cut taxes on the rich.

Right. Billionaire Donald Trump, widely known for caring more about his money than about people, says he does not want to cut his own tax bills. And yes, billionaire Steven Mnuchin says he doesn’t want to increase his own income, either.

Fortunately, most of America (about 2/3) is smart enough to recognize a con when they hear one.

Trump, Mnuchin and the rest of the Republicans, aka “the Party of the Rich,”  always are ready to vote against the 99%, as their hideous “health care reform” attempts demonstrated.

Their tax “reform” bills are true to form. Continuing the Atlantic article:

The House and Senate Republican tax bills cut taxes on the rich—significantly.

Their plans would slash the corporate tax rate by almost half, cut taxes on pass-through income for smaller businesses, eliminate the Alternate Minimum Tax, and erode the estate tax, all of which disproportionately help rich families.

This comes at a time when post-tax corporate profits as a share of GDP have hovered at a record-high level for the last seven years, and the top 1 percent’s share of total income is higher than any time in the second half of the 20th century.

Nearly 50 percent of the benefits of the Senate tax cut would go to the top 5 percent of household earners in the first year of the law, according to the Tax Policy Center.

By 2027, 98 percent of multimillionaires would still get a tax cut, compared to just 27 percent of households making less than $75,000.

Other than Republicans, all party, gender, education, age and racial groups disapprove of the bill.

Despite the unpopularity of both the House and the Senate bills, the GOP is plowing ahead with their pro-rich, anti-middle, anti-poor programs, just as they did with their anti-poor, health care bills.

Here is why, in the words of The Atlantic. 

“My donors are basically saying, ‘Get it done or don’t ever call me again,’” Representative Chris Collins, a New York Republican, told The Hill.

The “financial contributions will stop” if the GOP fails to deliver corporate tax cuts, Senator Lindsey Graham, a Republican from South Carolina, told NBC News.

“The donor class … has concluded that the inaction of this administration and Congress is totally unacceptable,” Josh Holmes, the former chief of staff to Senator Mitch McConnell, told CNN.

“(Donors) would be mortified if we didn’t live up to what we’ve committed to on tax reform,” Steven Law, the head of Senate Leadership Fund, a super PAC, told the New York Post.

In summary, the GOP tax plans, like the GOP health care plans constitute a taking from the 99% and giving to the 1% “donor class.”

Now here is the interesting part. According to The Hill, the House GOP tax bill would add $1.4 to the deficit. And Politico says the latest Senate tax plan would add $1.9 trillion to the deficit.

So, for all of you who are concerned about deficits — (you shouldn’t be, but that’s another issue) -the GOP bills benefiting the rich, add between $1.4 trillion and $1.9 trillion to the federal deficit.

What else could we do with that same $1.4 trillion – $1.9 trillion in deficit spending?

We could eliminate FICA.

According to the Tax Policy Center of the Brookings and Urban Institutions,  the government collects about $1.2 trillion in FICA taxes.

If the FICA tax were completely eliminated, the federal government simply could deficit spend to pay for Social Security (retirement, survivor, and disability) benefits and Medicare benefits.

This directly would benefit you salaried people of America, particularly you who earn less than $127,200 per year.

It also would be an excellent tax cut for businesses, a tax cut which would be used to increase profits, business growth investment, or salaries.

In any event, it would be an annual $1 trillion stimulus to economic growth.

You can read a more detailed description of this recommendation at: “Step 1. Eliminate FICA of the Ten Steps to Prosperity. 

Eliminating FICA would be simple to accomplish, requiring no additional labor (less labor, actually), no new loopholes, and no complications. Just stop collecting it.

The government would continue to pay the bills, as it already does. No change there.

We can grow the economy and shrink the Gap between the rich and the rest, all with one quick, simple tax cut.

With the current talk about tax cuts and tax reform, this is the time to end FICA, the most regressive, least fair tax in America. Even if we make no other changes, this one change will have a profound positive effect on our nation and us.

Our opportunity is now. We have only to demand it.

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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The most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich can afford better health care than can the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Economic Bonus)) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONE Five reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefitting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and business taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.

MONETARY SOVEREIGNTY