About Me

My photo
Jack is a graduate of Rutgers University where he majored in history. His career in the life and health insurance industry involved medical risk selection and brokerage management. Retired in Florida for over two decades after many years in NJ and NY, he occasionally writes, paints, plays poker, participates in play readings and is catching up on Shakespeare, Melville and Joyce, etc.

Sunday, May 22, 2011

The Budget, Deficits, Debt and Taxes - Latest Thoughts on Israel

We Do Get Around!  During the seven day period from May 15 to May 22, 101 viewers checked out this blog.  Of these, 83 were from the United States, 5 were from Germany, 3 were from Israel, and 2 each were from Iran, Russia and Singapore. We had one viewer each from Canada, France, India and Romania.  I suspect that most, if not all, of the overseas “hits” result from someone looking for something on a search engine and being referred to this blog.  I know that this week someone checked out an item I posted on May 10, 2010 entitled “Pogonotrophy in the White House.”  They could have found that this item was on the blog after doing a Google search, for example.  If you check out Google for the words “White House” and “Pogonotrophy” (which means growing hair on your face), the very first listing is this blog.  Conceivably, someone did this and others initiated similar searches on other subjects and ended up visiting Jackspotpourri.  By the way, viewers from Iran have been almost a “constant” on this blog, while other countries come and go from the listing with which I am provided.  Could an ayatollah be keeping an eye on me?
JL

                                      *****          *****          *****          *****

Surprise!  After my lengthy diatribes concerning the Real Estate Crisis and the Wall Street Crisis, offering a solution to the Budgetary Crisis is going to be quick and easy.  


Despite what the politicians say, most of the services the government provides are necessary.  These include funding the military, Social Security, Medicare, Medicaid and innumerable other things.  These are things the government does better than the private sector can do them.  The government didn’t just start doing these things out of the blue.  They were voted on and approved by Committees and the members of the House of Representatives and the Senate because the people and their representatives saw a need for them.  This happened over the years in Congresses controlled by both Democrats and Republicans.   They are what the people want. That’s why legislation providing for them was passed.  So let’s not run around cutting them out, willy-nilly!


Unfortunately, because we don’t collect enough revenue each year to pay for these government expenditures, we borrow each year to make up for the deficit in our revenues.  We borrow from anyplace we can, ranging from the Social Security Trust Fund to the Chinese “state capitalist” system, which loves to purchase our government’s bonds.  Servicing what we owe (interest payments on our debt) adds to the annual shortfall.  Over the years this debt has grown into the trillions of dollars.  


The answer to this challenge is not the simple solution of giving in to the shrill demands to reduce what government spends and what government does.  At one time or another as I have said, we passed laws authorizing that spending.  Elimination or reduction of programs to bring about reduced spending might reduce the deficit a bit but it won’t do much to reduce the debt.  And such reductions would be painful to some Americans somewhere in the nation.  


So, if we are not going to make cuts in spending, the only way to go is to increase revenues significantly.  Then we’ll have enough to avoid having an annual deficit and we will be able to begin to reduce the debt.  


To increase revenue, we must bite the bullet and greatly increase personal income taxes.  This should be done in the higher brackets, above $300,000, where it can be more readily affordable.  Those earning above that amount have been treated well by our economy and they should not resist paying higher taxes.  I do believe that Warren Buffett and Bill Gates agree with this position (even though most of what they earn is not taxed as personal income).  From the revenues thereby generated, we may be able to avoid an annual deficit, without reducing government spending, and to begin retire the national debt.


As for corporate taxes, I propose they be cut to a level where no company would ever use high taxes as a reason to base some of their operations outside of the country.  This will create millions of jobs in this country.  If necessary to reach this goal, corporate taxes can be eliminated entirely.  And if outsourcing of jobs still remains prevalent, taxation of corporate profits resulting from that practice should be instituted. (See an earlier posting on “The Outsource Tax." You can find it by clicking on the February listings to the right.)  The new jobs thereby created will also bring about additional tax revenue and as businesses prosper, their individual stock holders will be paying personal taxes on their gains.  These will be, as I previously indicated, higher in brackets above $300,000, so the revenues thereby produced will more than make up for the drastically reduced corporate taxes.


Okay:  Let’s look at our three legged stool one last time.
  1. My ideas for solving the Real Estate Crisis will ultimately turn many strapped homeowners into satisfied renters and revive the construction industry, a major source of jobs.
  2. My ideas for solving the Budgetary Crisis will enable the government to continue to spend for necessary services and create jobs as corporate taxes are decreased or eliminated and personal taxes are increased for the wealthy, measures which will eliminate the deficit and significantly reduce the national debt over the years..
  3. My ideas for solving the Wall Street Crisis will enable the economy to heal itself through the mechanisms of the free market system without it being pilfered by the greed and speculation of the banks, brokerage houses and “other players,” whose self-serving and occasionally dishonest activities will be eliminated.
If we don’t fix all three legs of the stool, what do you think will happen?


As always, your comments are welcome.  If you don’t have any to make, I suppose you are part of the problem and not part of the solution, which in some small way, I have been trying to be, over the past few postings.
Jack Lippman



                                   *****          *****          *****          *****


Israel in the News 

President Obama’s recent comments about solving the Israeli-Palestinian impasse have raised a lot of hackles among supporters of Israel.  In particular, the President mentioned using the 1967 boundaries as a basis for negotiations.  Israeli Prime Mininster Netanyahu immediately pointed out that those boundaries were indefensible, a fact which resulted in the 1967 attack on Israel by surrounding Arab states.  Israel ended up, after winning that war, with more defensible borders.  

President Obama mentioned “land swaps” in connection with those 1967 boundaries.  While most observers feel this was intended to refer to Israel being able to keep contiguous West Bank land on which there are established Israeli settlements and in exchange, give up equal amounts of land elsewhere along the boundary, such “swaps” might also involve West Bank (and Gaza) territory which Israeli needs for defensive purposes.  The West Bank area bordering the Jordan River and the Philippi corridor between Gaza and Egypt are such areas.  With this in mind, I suggest you re-read my March posting (Thoughts on Israel) which can be accessed by clicking on “March” to the right.

A point which should be made is that it is entirely possible to be a devout Jew and/or a committed supporter of the State of Israel while still supporting a “two-state” solution to the Israeli-Palestinian impasse.  Unwavering support of Israel is not exclusively limited to those who are against such a solution.  While this idea is readily accepted among Israelis, some American Jews have trouble with it.
JL

No comments: