If you can fog a mirror you are certainly aware of the Obamessiah’s grand plan to save jobs in America. If you are so inclined you can read the full 199 page proposal here.
For those of you not inclined to read the musings of Barry O and his legal minions, let me summarize his $447B plan for you.
- Cutting the payroll tax for employees and 98% of businesses
- Payroll tax holiday for adding workers or increasing wages for small businesses
- Expanding the SBA backed loan limits
- Tax credits for hiring unemployed veterans
- State funding for preventing layoffs, modernizing schools, improving infrastructure, and expanding broadband access
- Extending unemployment benefits
- Tax credits for hiring long-term unemployed workers
- Mortgage refinance programs
- Fully paid for by the President’s long term deficit reduction program
Well folks, doesn’t that make everyone feel better? The Obamessiah rode in on his white stallion to save the day. We are lucky to have him…
I don’t want to go into all of the details since you can find that on the site mentioned above or on any number of other news sites, but there are many fallacies in his logic here.
For example, $35B is targeted towards saving the jobs of 280,000 teachers. Simple math tells me that taxpayers are paying $125,000 for every teacher job saved. While I certainly value the work that teachers do, the price seems a bit high.
Another point of interest is the President’s plan to cut payroll taxes in half. Considering that the Social Security Administration is now paying out more in benefits than it collects in revenue, does it really make sense for the President to propose a plan to cut its primary revenue source in half?
Based on the average estimate of several top economists, the jobs plan will create about 1.4M jobs. Again, my simple math tells me this comes out to be over $300,000 per job. Considering the median income in the US hovers around $40,000, where is the remaining $260,000 going to end up?
As I review the Obamessiah’s jobs plan, the thought that keeps sticking in the back of my mind is, “This is like putting a band-aid on a bullet hole.”
The US, as well as the rest of the modern world, is bleeding. The bloodshed is coming from unscrupulous politicians looking to save their own asses and the asses of their campaign donors. The free money era is coming to an end ladies and gentlemen.
Do you really think it’s a coincidence that Barry O proposes a jobs plan aimed directly at the middle class with one year left before the presidential election? He is trying to buy political goodwill with the weak minded masses.
I am all for tax cuts and helping small businesses, but every proposal by this administration just increases the amount of red tape and thus the size of government. Sure, it sounds nice to give tax credits and payroll tax cuts to small business, but who do you think is going to regulate this?
Voila, looks like the IRS is hiring again. In addition, small business owners are now going to have to hire more accountants and lawyers to maintain compliance which increases their own cost of doing business.
Maybe I’m a naïve simpleton, but why not give a tax holiday for repatriating offshore profits held by US companies? There is over $1.2T in profits held by US companies in offshore entities that will remain there as long as the US penalizes companies for creating efficient structures to compete globally.
Of course a big argument here is that the big corporations won’t actually use this money to hire new workers, but instead give it back to shareholders in the form of dividends or share buybacks.
My view is that even if corporations refuse to use this money to hire one single worker and use the money instead for shareholder enrichment, they would now feel richer and spend money more freely. This would create an increase in consumption and companies would then need to hire anyway to meet demand.
But again, maybe my simple mind just doesn’t understand the way the world works.
Here’s another idea for the government – get the hell out of the way. Eliminate agencies and departments that offer no increases in economic productivity and completely revamp the tax code.
In business, you want to create incentives for your workers to do the right things. You pay operational people incentives based on profitability, you pay sales people incentives based on sales, you pay production people incentives based on productivity, and so on.
If you want to provide the right incentives as a nation, you need to start with a tax code that provides the right motivation. Right now the tax code is so overly complex, it effectively makes all of us criminals by default. It is virtually impossible to be 100% tax compliant. Read Barry O’s jobs plan and you will see what I mean.
America became the world’s superpower because it was an innovative place where people could come and be free to run their businesses as they chose and not be restricted by oppressive government regimes.
America has now become what it was originally rebelling against.
We need to start at the foundation with a tax code that provides the right incentives. A consumption based tax in the form of a national sales tax used alone or in conjunction with a low flat tax would immediately put this country back on the path to prosperity.
I would propose either a national sales tax of 25% alone, or a 15% sales tax in addition to a 10% personal income tax. Eliminate the corporate income tax, capital gains tax, investment income tax, death tax, and nearly every other tax that we probably aren’t even aware of.
Ahhhhhhhhhhhhh, ok – back to reality. That was good to get off my chest. But we all know the likelihood of this utopia becoming a reality is nil.
I would encourage you all to assess your own personal situation. Are you well positioned for the world in the ‘Great Reset’? Do you have the skills necessary to thrive in today’s economy? Are you living the life you dreamed of as a kid?
Today is the day to take responsibility for your life. Sure, I rant about governments and stupid politicians every week, but I am a firm believer in using this knowledge to improve your life and increase your wealth.
The quality of your life depends on how you react to what the world throws at you. Are you living life on your terms?
Call today to schedule your free 30 minute asset protection consultation. Until next week, live extraordinary.