Economics

The Grand Bargain

David J. Putman's Vision for the American Economy

What are taxes for?

Taxes are for the people. Taxes are intended to pay for the necessary functions of a government that itself exists to serve the people. But our current system is badly broken and only a bold and bipartisan solution can hope to repair a system that no longer makes sense within the current economic landscape.

What happens when the tax laws no longer serve the best interests of the people?

Then those laws must be changed.

The Grand Bargain

I am proposing what I like to call The Grand Bargain - a plan that I believe can work even in our divided political climate. For those on the right the bargain would eliminate corporate taxes and give a common sense income tax structure. For those on the left the bargain would address concerns of fair and equal wages and reduce or eliminate the need for the social programs that so many Americans have come to rely upon. 

The truth about corporate taxes

Corporate taxes are high, but due to loopholes and the all-too-common practice of moving American jobs outside of our country, these taxes often go unpaid. In 2013 alone only about 10% of the federal budget was comprised of taxes actually paid by corporations. And corporate taxes are money that is difficult and expensive to collect. Corporations do everything in their power to hold on to every dime.  They move overseas. They make foreign investments.  They lay off American workers.

Make no mistake: Corporations do not intend to pay their fair share of American taxes.

So, we do away with corporate taxes altogether.  

At first glance it seems a radical proposal, but in doing so we create an environment where corporations no longer have an excuse to leave for foreign shores. In fact, I believe that under my plan many corporations will have great incentive to bring manufacturing jobs back to America that have previously been taken elsewhere. Imagine that - American jobs coming home to America.

In return we ask America’s corporations to pay their employees a living wage.  We immediately raise the federal minimum wage to $15.00 an hour.  We require employers to provide a minimum of paid sick leave, paid vacation, and paid maternity leave for both mothers and fathers.

The people get more jobs, better jobs, better paying jobs and the corporations get what they have wanted all along. No taxes.

But we must not stop there.

For personal income tax, we establish four flat rate steps, treating every dollar earned in that year the same no matter what the source; treating all large gifts, inheritance, or other unearned income as taxable income for the year when it is converted into cash.

For hard working women, we must act. Whether they be single women looking to establish themselves in a career, mothers trying to feed their children, or wives trying to help keep their families in a home they have come to love, they make 21 cents on the dollar less than their male counterparts.  This is a situation that is not only unjust but is inherently un-American. We must insure that equal pay for equal work is not just an ideal but the reality of every working man and woman in this country by signing the Paycheck Fairness Act.

For those citizens who have worked hard all of their lives, we must secure the future of Social Security by asking everyone to pay their fair share by removing the cap on taxable income.

For all of us burdened by the increasing costs of health care and the confusion of the system, we must reform the system.  We must no longer be bound by the whims of the insurance companies.  We need a clear and straightforward single payer system.

We must secure the future for those generations that come behind us and are even now ready to take their places as citizens and leaders.

We must provide a sufficient education for them.  We do this by establishing and providing funding for voluntary childcare and mandatory age 3-4 pre-kindergarten programs for the all important early years. For those not bound for college, we provide a fourth year of high school that is focused on vocational training so we do not leave them unprepared for the world we have left for them.  For those who are college bound, are in college, or are still staggering under the burden of student loans, we allow them to refinance for lower interest loans based on the market and we get the government out of the student loans for profit game.

What will these changes do? Who are they for?

They are for all Americans.  They are for the corporations and for the single mothers. They are for the kids in school who are just starting out and for the retirees who have given their lives for this country and deserve our respect and care.

The America we get from these plans is an America where we not only see corporations reinvesting in America but one in which other companies move back here or to here for the first time. Because of this increased prosperity and the economic security,with these plans tax revenues will rise as incomes rise. We will see over 300 billion dollars in the first year. We will move away from deficit spending and toward a balanced budget.

Sometimes a bargain really is a bargain. Sometimes change really is change for the better.

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