Bring Back Reagan Economics
There has been a lot of print dedicated to our economy, taxes, the war on terror, immigration and. most recently, tax cuts affecting benefits, health care, welfare programs, and the like. Many of these issues have swirled around the upcoming presidential election and the candidates’ respective positions. Frankly, none of the GOP candidates, nor Barack Obama, seem to have all of the solutions refined. I would like to hear our incumbent, or one of the Presidential hopefuls, state realistic policy positions and perspectives on our current state of affairs as viewed by the majority of the citizenry.
At the core of a number of issues is America’s tax code, which frankly is an industrial mess. The code is needlessly complex because of deductions, credits, exceptions, date enablers, and loopholes. As a result, our government’s huge size is a direct result of this burden of administering the complexity of the IRS code and its subsequent enforcement (tax courts, attorneys, judgments, liens, garnishments, etc.).
Speaking as an ardent fan of former President Ronald Reagan, I would like to suggest that the candidates reconsider elements of the Economic Recovery Tax Act (ERTA) of 1981, the Reagan tax cuts. As some of us will recall, the core proposal was a 25% decrease in personal marginal tax rates. The Reagan tax cuts showed that reducing excessive tax rates stimulates economic growth, reduces tax evasion and tax avoidance schemes, and can actually increase tax revenues from the rich. We absolutely need tax reform that is fair, simplified, flat, low, and easy to administer.
Incorporating elements of former candidate Herman Cain’s more aggressive 9-9-9 plan as well as the proposed Flat Tax plan is pivotal to reforming a tax system that simply no longer works. We need to collect flat taxes from all U.S. citizens above the poverty line, eliminating income taxes for those below the poverty line; drastically reduce entitlements and entitlement programs; and lower the corporate tax rate so that the U.S. can regain its competitiveness in the global markets, while reducing our unemployment. We currently outspend on foreign military activities more than the actual net income of all U.S. corporations combined.
Let’s continue to invest heavily in our country’s security, shoring up our borders and deporting illegal aliens found guilty of criminal activities, while withdrawing our military occupation of other countries. We can then begin enjoying a more prosperous era of economic growth, whether led by an incumbent president or by a GOP candidate.
Igor Sill studied Economics and Political Science at UC Berkeley, and received his Masters from Oxford University as a Merton College fellow. He is a member of the Royal Economics Society, and the Oxford Finance & Investment Society, and studied Reaganomics. He founded Geneva Venture Management and resides in Santa Barbara, California.