America cannot work if Americans are not working.
President Obama's pledge " We should reduce the tax burden on working people. The middle class needs a government that is working to create jobs."
But two Sundays ago, Obama's advisors began laying the groundwork for a middle class tax hike that will end up killing more jobs. One more campaign promise broken.
Failing to defend President Obama's pledge not to raise middle class taxes, White House economist Larry Summers said "it is never a good idea to absolutely rule things out no matter what." This was echoed by Treasury Secretary Geithner, saying the administration is "going to have to do what it takes" to decrease the deficit. The White House has begun to backtrack. But their determination to pass a $1 trillion healthcare bill that the majority (and growing) of Americans do not want and a $1 trillion energy tax that will affect every American makes it pretty clear how unconcerned the liberals in Congress really are with raising taxes on the middle class continuing on with their tax and spend policies.
With almost 10 percent unemployment, we must stop these tax increases and focus on creating jobs. "Jobs First" should be the prime directive to oppose a job-killing tax increases, and concentrate on enacting policies that will help create jobs here and jobs now.
It begins with using unspent stimulus and TARP funds to pay for a two year, 50 percent cut in the payroll tax. This will immediately increase the take home pay for every working American, and free up money for every small business to invest, save, and create jobs. But that is only the first of four simple steps. If there is one truth we should keep in mind, it's that America cannot work if Americans are not working.
The Federal Reserve predicts will that we'll reach 10 percent unemployment by the end of 2009, and that it will likely take five years before we are creating a substantial number of net new jobs. Presidents Bush and Obama tried to fix our economy through bailouts of big companies and big government stimulus packages. This approach has failed.
We must propose a plan for job creation aimed specifically at those who create jobs; small businesses and entrepreneurs. Cut the payroll tax in half for two years. Every single working American pays the payroll tax. In this economy, many people may not get a pay raise, but this would immediately give every working American a take home pay raise. This would also immediately increase the liquidity of every small business, because there would be more money available to put back into the business and create more jobs.
Social Security and Medicare funds will not be affected. We would pay for this proposal by redirecting all the TARP and $787 billion stimulus money that has been allocated but not yet spent.
We should abolish taxes on capital gains. If we want to compete with China and have the most productive factories in the world, the best jobs, and the highest take home pay, we should match China's capital gains rate of zero. This would dramatically increase investment in America.
We should reduce the corporate tax rate. When you combine state and federal taxes, America has the highest corporate tax structure in the world. By matching the Irish corporate tax rate of 12.5 percent, America would be the most desirable economy in the world to open new factories, create new jobs, and develop new products.
Finally we should abolish the death tax. If we want to be pro-work, pro-savings, and pro-family, we should not punish, but instead reward people who have worked, saved and created wealth all their life. We should not punish success with wealth redistribution and by giving it to lazy illegals that come to America for a free ride.