Forget about all the increases in Government spending and taxes! President Obama’s rescue package is nothing more than using the economic downturn as an excuse to promote a socialist spending agenda and has little in the way of economic stimulus. All the Government has to do is cut the corporate tax rate to the same rate levied by most of our foreign competitors. By cutting the corporate tax rate from 35% to 25% or less, our products could become more competitively priced in the global market, fewer jobs would be shipped overseas, jobs would be created in the U.S., personal income would increase, inflation would remain at low levels, our balance of payments would improve, the dollar would increase in value thereby increasing the purchasing power of Americans, interest rates would remain low (helping home values), and capital spending on plant and equipment would increase thereby creating even more jobs.
Another benefit from reducing the corporate tax-rate would be an increase in the value of investments that would help our citizens’ retirement plans. Government workers, including politicians, have a defined-benefit plan for their retirements where the employer (i.e. the taxpayer) guarantees the amount of their pensions. So, unlike most Americans, their retirements are not subject to the fluctuations of the investment markets. No wonder the Administration makes light of the “normal gyrations of the stock market.” But, 93% of non-Government workers have retirement plans where their benefits are a function of the level of securities’ prices. The politicians talk about the questionable future of Social Security; meanwhile they have neglected the value of individuals’ primary assets, the value of their real estate and market investments.