By Konrad L. Heid
Special to The Globe
JOPLIN, Mo. —
Someone mentioned the other evening that I have been noticeably quiet in writing and expressing my thoughts in The Joplin Globe.
As we all did, I watched the recent election unfold with hope like many that we would or could finally grab hold of our financial problems. As the rhetoric rose nearer the election, it was pretty obvious this would not be the outcome come Election Day. Who can argue with socking it to the rich? Now the conversations centering on the “fiscal cliff” sound like election rhetoric all over again.
There are many possible responses to spending beyond tax revenue income. Let the tax cuts expire so 47 percent can pay another $2,000 or $3,000 in income taxes each year. And another 15 percent to 20 percent can lose the 2 percent Social Security withholding reduction enacted a couple of years ago.
We could raise taxes on all upper earners. Why not pick $100,000 as the threshold? This would put a lot of dollars in the kitty to spend — not enough to cover the deficit spending, but hey, it’s a good wealth-transfer opportunity.
Or we could eliminate tax deductions (referred to as loopholes) like deductions for interest on home mortgages or health savings accounts or alimony paid or self-employed health insurance or student loan interest or credit for child and dependent care expenses or the child tax credit. Oh, and let’s just eliminate Schedule A itemized deductions altogether. Only about 26 percent of taxpayers have enough qualifying expense deductions and donations to itemize over the standard deduction allowed anyway.
While we’re at it, let’s eliminate most not-for-profits. A lot of those organizations are using the 501(c)3 exemption as a way to skirt paying income taxes.
There’s another solution, and it’s the easy one. Let’s extend all tax breaks and deductions currently in place and add a few more if you’d like.
One might ask a question or two about this spend, spend, spend solution. Not a problem. The Federal Reserve has the printing presses; it will print the dollars needed to spend, spend, spend, then turn around and buy, buy, buy the debt.
So we’ve got 15 million unemployed and $87 trillion in unfunded liabilities. Who cares? After all, we are the leaders of the world. We need to show them how it’s done.
Konrad L. Heid