- Effective immediately have the Tsy make all FICA payments on behalf of employees and employers. Leave this arrangement in place at least until it is deemed that the economy is growing too rapidly.
These payroll taxes currently reduce income by about $1 trillion per year for employees and employers and are highly regressive.
Removing these payroll deductions will immediately add about $20 billion per week of ‘spending power’ to the economy on an ongoing basis, and all the funds benefit workers and businesses.
- Effective immediately distribute $100 billion in unrestricted federal revenue sharing to the states on a per capita basis.
- Make another $200 billion of federal revenue sharing available to the states for general infrastructure repairs and projects.
This will effectively increase take home pay, remove a cash drain on business, address infrastructure needs, and support employment and income in general.
What Wall St. and Main St. need most are consumers who have the funds to make their mortgage payments and car payments, and be able to buy what the US can produce.
This ‘bottom up’ approach will work, while the current ‘top down’ proposals may eventually show results but will take far longer to reverse the current slowdown.
And while my proposals will result in an immediate recovery, they do not address the energy issue.
Any recovery will drive up energy prices if consumption is not first reduced by both the private and public sectors.
Regarding energy, why not append some kind of gasoline tax to your proposal to try to stave off gasoline demand. Perhaps incrementally raise the gasoline tax as GDP increases. Keep diesel out of it.
that works, but it allocates by price- hi incomes get to drive suv’s while low incomes take the bus.
seems this is counter agenda for the democrats in power.
instead they could mandate my 30 mph speed limit for private transportation, or maybe mandate nat gas powered cars, higher fuel economy standards, pluggable hybrids, etc. and attempt to ration on something other than price.
Trickle up Economics.
I think the energy idea isn’t as important as getting money into the hands of consumers right now. The energy is a long term play, plus the 30mph limit sounds like a dictatorship. it would be like increasing taxes to 80%
One thing that is good about this proposal is the persistent way that it provides stimulus. This will manage the expectations of the businesses that are supplying the products to meet the extra demand in a very positive manner
Yes, that’s the important thing – instead of giving some sort of number for stimulus (and I’ve been hearing talk about $300B, as if it’s a big number! More like a down payment.), just skew the tax structure steeply into deficit, and keep it there until things improve. And I bet Repubs would even vote for it, since it’s a tax cut (even though it does go to the “wrong sort of people”, from their perspective…)