If We were Emperor!

[“If We were Emperor” is the style I am using in order to frame my opinions. 
I do not advocate the overthrow of the current US government or the Constitution.]

 There are several things We would do in order to get the country and economy back on track:

Taxes: 

1.                 Repeal the two big tax cuts instituted by President Bush, in 2001 and in 2003.

2.                Stimulus plan:  A cheque for $5000 to everyone who has filed a 1040-based tax return in 2011.  [Assuming 150 million taxpayers, corporations NOT included, this would cost $750 Billion.] This would put the money into the hands of those who would give a boost to the economy, the consumers, by buying durable goods, paying down mortgages, etc. It would do what The President Bush said we should do, just after Sept 11, “go out and spend money”; it was said to individuals, not to corporations.

3.                Boost for Lower and Middle-classes:  Raise the personal deduction to $7500, indexed to the Cost of Living.

4.                Cap the amount of taxable deduction for interest on home mortgages to $25,000 to $50,000 per year.  The interest cap could be indexed to the Cost of Living Index for that area

5.                Cap other governmental agencies at current spending levels for 5 years.

Education:

1.                 Grants: We would expand grants to students attending accredited institutions of higher education.

2.                Loans: Students would pay off the Federally Funded Student Loans either:

a)     by paying a percentage of  their GROSS income, 1%, 2%, or other suitable percentage. This allows graduates to accept a lower paying job of their choice rather than be forced to accept a job that will not advance their careers.

b)     or a standard loan agreement over 10 years at the Prime Rate plus 1%, payment to start one year after graduation.

3.                Tuition Rebates: We would set up tuition rebates for students in Mathematics, Sciences, and Engineering at accredited institutions of higher education who achieve a cumulative 3.5 GPA or better by the end of their 3rd academic year.  The rebate would be up to $10,000 or $20,000 in tuition rebates for the 3rd and 4th academic years.  This tuition rebate would also apply to Graduate Students.

Energy:

1.                 Energy Production: Accelerated depreciation [5 years on a plant designed to last 40 years.] on the Capital Costs of creating non-fossil fuel energy production assets, e.g., Wind turbines, Photovoltaic cells, Solar Updraft Towers, Hydrothermal plants, etc.

2.                Equipment Installation: 100% deduction, depreciated over 3 years, for equipment and installation of alternate energy producing units by individuals and businesses in the tax year of installation.

 

Transportation:

1.                 Increase Federal gas tax: Add a10 cent a gallon increase in the Federal tax on petroleum products with the money going to maintenance and repair of existing infrastructure. NO NEW CONSTRUCTION! The Federal tax is earmarked for existing roads and bridges. We would add up to10 cents every year for 5 years.

Each one cent [0.01] increase brings in about $1 billion dollars in revenue.  This is equivalent about 25,000 new jobs.  Each new job will bring in about 2 or 3 additional jobs into the market.  The 10 cent a gallon or equivalent increase in the Federal tax on petroleum products could result in approximately 500, 000 and 1 million new jobs.

2.                State gas tax fund: Require states to put state gasoline taxes into a separate fund, to be spent on roads, bridges, and other transportation infrastructure. Most state gasoline taxes go into the General Fund and never get spent on infrastructure.

3.                State funding: All states would be required to spend, not allocate, a minimum of 90% of the previous year’s road transportation budget or lose ALL Federal DoT funding the following year.

The cost of the increase in the tax is about $48 a year to the motorist who drives 12,000 miles a year and gets 25 mpg.  If one drives less and or has a more fuel efficient vehicle, the cost would be less.  What is the cost of a new tire, wheel alignment, wheel balancing, shock absorber, ball joints, etc.? The US’s poor infrastructure costs motorists $67 Billion a year.  [From an ad by Audi.]

Social Security:

Raise the taxable limit for Federal Insurance Contributions Act (FICA) tax to $250,000.  Increase this to $500,000 24 months after the previous increase.

Currently, someone who earns $102,000 pays 6.2%.

Someone who earns $250,000 pays 6.2% on the first $102,000, and pays 0% on the remaining $148,000.

Someone who makes $500,000 pays 6.2% of the first $102,000, and 0% on the remaining $398,000.

The first change would mean:

Someone who earns $250,000 pays 6.2%.

Someone who makes $500,000 pays 6.2% of the first $250,000, and 0% on the remaining $250,000.

6.2% of that $148,000 is significant. When the limit moves to $500,000:

Someone who earns $500,000 pays 6.2%.

Someone who makes $750,000 pays 6.2% of the first $500,000, and 0% on the remaining $250,000.

If someone currently making $102,000 or less can pay 6.2% of their income to FICA, certainly someone making $250,000 or more can manage.

Health:

  1. Medicare/Medicaid: All Medicare, Medicaid, etc., payments would be frozen at current levels for 5 years.
  2. Health Insurance: Any US citizen would be allowed to sign up for The Federal Employees Health Benefits [FEHB] plan, the plan that is available to all federal government  employees. (It’s the same one members of Congress use.)  This would be a “Public Option.”  The Federal Government would pay approximate 75% of the premium and the individual-family would pay the other 25%.  The insured would be free to choose any of the several private insurance plans in the insured’s area: Blue Cross/Blue Shield, Kaiser Permanente, or in my case for example, the Capital District Physician’s Health Plan [CDPHP].  I get to choose my doctors [I easily switched urologists recently]. 

Department of Defense

1.                 A 5% across the board increase in pay and benefits for all Military Service personnel.  They don’t get anywhere near what they deserve.

2.                The DoD budget would be frozen for 5 years.  While research would be encouraged, development would be limited to proof of concept prototypes.

3.                DARPA would be encouraged to expand  its challenge programs: Set standards and let private inventors meet the challenge.  Sort of small X-Prize offer.

4.                Decrease the DoD budget, potentially 5% a year or more, for 5 years:

a.     by evaluating the necessity of building expensive equipment simply because it’s “new”, when existing equipment is more than adequate for current and near-future projections of enemy capabilities (we’re not fighting the Soviets any more);

b.     by evaluating the necessity of building more of the expensive equipment that no longer meets the operational needs against current and near-future enemies (how many aircraft carriers do we need to fight, or support fights, in small towns in the Middle East?);

c.      and by bringing our service personnel and materiel back home. The ability to mobilize quickly, to transport personnel and materiel needed for quick strike missions, no longer requires the tremendous expenditures of overseas bases.

X-Prizes:

We would set up a series of Federally funded X-Prizes in areas of  need, i.e., energy, space exploration, engineering challenges.  The money would go to the winning teams, not to the institutions for whom they may work.  X-prize funds are not paid out until the established goals are met!

 [This is my opinion.  I encourage you to write your own screed.]

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