Wednesday, June 29, 2011
Why not tie the upper income and corporate tax rates to the percentage of unemployment?
Setting up the corporate tax rates so that they become lower as the unemployment rate decreases and they become higher as the unemployment rate increases should provide a strong feedback mechanism that will self-motivate the business community to extremely rapidly create jobs -> at the same time it will allow them to increase profits, and it will increase the taxable income and taxable trade at both the state and federal level.
It would reestablish the concept that we are all parts of a whole and that we all have a responsibility and an interest in the success of the country.
Rather than conceptually backing high income people into a corner where they will fight for their right to profit - it would give them a way out (bring others up to a fair level of prosperity and then you can profit more).
It would calm the potential class division (income division) social stresses from both the lower income/unemployed and the upper income people/business perspectives.
It should directly and indirectly cause massive reinvestment in this county of sufficient capital to rapidly create jobs - which should feedback to the local economies and therefore increase the stability of not just the taxable income but also the taxable trade (so both the federal and state tax bases should increase).
It ought to be more successful than the old "look for the union label" campaign in directing the flow of money back into the United States (without the international trade social problems).
It ought to provide a common framework for the more rational members of both political parties because it gives them each something that would positively benefit all of their constituents (rather than having to chose one group to benefit and one to suffer).
By moving the guiding framework from the decisions of the government to the self interest of the business there should be a long term motivation for all businesses to hire as many people as possible.