| The signs are pointing to a recession, and that should give us all pause. The government is already engaged
in heavy deficit spending, the Fed has lowered interest rates to a point that
has the dollar in freefall, and consumers are already maxed out on debt. What
further levers can we pull to get ourselves out of the ditch?
The one obvious strategy is the one everyone ignores – stop
penalizing corporations for putting activities in the U.S.
Under current tax policy, a corporation can make 54% more profit operating in
the Dominican Republic
than in the U.S.,
even before considering the much lower wage rates abroad. We can reverse that
incentive, and we can do it in a way that is revenue neutral, that favors the
middle class, that encourages savings, and that reduces rather than increases
corporate power. How? By allowing a deduction for dividends paid to
shareholders, with the revenue offsets explained at www.sharedeconomicgrowth.org. That would also eliminate the hidden 35% tax on supposedly tax free or tax deferred retirement savings.
It’s time to demand that our political representatives
drop their canned speaking points and take real action to improve the long term
health of our economy. |