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If you have family in the US, moving to India is not necessarily a viable option.
I understand it being a less viable option if your significant other is working here (in which case, there's money coming in). Otherwise, they can accommodate families in India as well.
On the one hand it is better to take a 20% pay cut than 100%. On the other, the laid-off usually get unemployment pay for a while. Since the "lucky" ones get to keep their full paychecks, their spending power equals the entire amount that the entire workforce would get under the reduced hour scenario, plus the not-so-lucky spending their unemployment pay. Of course that is no excuse for politicians to sit on their fat congressional seats while failing to address the problem.
I'm not an economist or a Ivy League graduate so excuse me if what I say makes no sense. What if the government did the following to lower the unemployment rate:
1.) Shut off ALL and ANY loopholes that companies have as far as tax avoidance goes.
2.) Offer companies that higher an X amount of workers a certain percentage in tax reduction depending on how many people they hire (the more they hire, the bigger the tax reduction).
3.) Lower the corporate tax rate to keep it competitive with the rest of the world.
4.) Give tax cuts to companies who bring back outsourced jobs in addition to #2.
Yes, these are broad and probably have holes in them but if we can get people hired and working, the government can tax those incomes and offset the tax revenue losses from corporations.
I'm not an economist or a Ivy League graduate so excuse me if what I say makes no sense. What if the government did the following to lower the unemployment rate:
1.) Shut off ALL and ANY loopholes that companies have as far as tax avoidance goes.
2.) Offer companies that higher an X amount of workers a certain percentage in tax reduction depending on how many people they hire (the more they hire, the bigger the tax reduction).
3.) Lower the corporate tax rate to keep it competitive with the rest of the world.
4.) Give tax cuts to companies who bring back outsourced jobs in addition to #2.
Yes, these are broad and probably have holes in them but if we can get people hired and working, the government can tax those incomes and offset the tax revenue losses from corporations.
I agree with number 3 and 4. Don't know enough about 1 and not so sure I agree with 2.
I'm not an economist or a Ivy League graduate so excuse me if what I say makes no sense. What if the government did the following to lower the unemployment rate:
1.) Shut off ALL and ANY loopholes that companies have as far as tax avoidance goes.
2.) Offer companies that higher an X amount of workers a certain percentage in tax reduction depending on how many people they hire (the more they hire, the bigger the tax reduction).
3.) Lower the corporate tax rate to keep it competitive with the rest of the world.
4.) Give tax cuts to companies who bring back outsourced jobs in addition to #2.
Yes, these are broad and probably have holes in them but if we can get people hired and working, the government can tax those incomes and offset the tax revenue losses from corporations.
The thing is the tax credits would have to be equivalent to how much cheaper it is to hire Asian and Mexican workers to do the same work.
The fact of the matter is a person in a factory making $25/hr in America can't possibly compete with someone who's willing to work for $2.50/hr or less in Mexico or China.
Beyond that, there's the issue of how these companies will be penalized if we do give them these tax cuts and they don't create any jobs, because that'll mean less tax revenue for the federal government to maintain all of the very expensive infrastructure it has in place.
I'm in complete agreement with suggestion #1 of course, Suggestion #2 and #4 aren't practical.
As for Suggestion #3, no corporation in America pays the marginal 35% rate. The corporate tax in America is choke full of so many loopholes that many corporations end up either having no tax liability at all (which is BS) or an effective rate lower than what corporations in most other countries pay.
Honestly, as much as major shareholders of these large corpraotions whine about taxes and regulations in America, at the end of the day it's all baseless rhetoric because they would never want to live in hellholes such as New Delhi or Mexico City, where the air/water is deadly, everyone's cramped on top of each other and crime is rampant. Those places make America's major cities Americans whine about look like paradise in comparison. That's why even today all of the world HQs are still in America.
Last edited by 313Weather; 09-15-2012 at 09:52 PM..
The thing is the tax credits would have to be equivalent to how much cheaper it is to hire Asian and Mexican workers to do the same work.
The fact of the matter is a person in a factory making $25/hr in America can't possibly compete with someone who's willing to work for $2.50/hr or less in Mexico or China.
Not true at all. The $25/hr factory worker simply has to produce 10 times more than the one in China. Being that we manufacture 18% of the world manufactured goods, businesses are doing what they have to do to adapt. That also requires the factory worker learn new skills that are relevant in this changing world. Apply that logic to every profession, and that is how economies as a whole adapt. America is going to have some growing pains, and we may have to contend with systemic high unemployment for a period of time, but you have no choice. Economies have always had to adjust. Sure, it was hard on the buggy whip maker when people started buying cars, but that just meant he was free to utilize his time in another more relevant occupation.
Trying to stop this transition with tax incentives only stalls the drive to innovate better and more competitive ways to get the job done.
I'm not an economist or a Ivy League graduate so excuse me if what I say makes no sense. What if the government did the following to lower the unemployment rate:
I am a double major (one of which is economics) graduate from an Ivy League university and I'll add my two cents here.
Quote:
Originally Posted by RedRage
1.) Shut off ALL and ANY loopholes that companies have as far as tax avoidance goes.
The tax code is full of loopholes. These loopholes exist for both corporations AND INDIVIDUALS. ALL these loopholes should be closed. This includes everything from the farm equipment deductions that businesses use to purchase large executive SUVs to mortgage and child tax deductions individuals use.
Quote:
Originally Posted by RedRage
2.) Offer companies that higher an X amount of workers a certain percentage in tax reduction depending on how many people they hire (the more they hire, the bigger the tax reduction).
No. Tax incentives for hiring is not going to solve the real problem... which is demand. This is a loophole in the making.
Quote:
Originally Posted by RedRage
3.) Lower the corporate tax rate to keep it competitive with the rest of the world.
Absolutely agree.
Quote:
Originally Posted by RedRage
4.) Give tax cuts to companies who bring back outsourced jobs in addition to #2.
This is silly. Insourcing everything is a very inefficient way to operate. If we want to remain competitive on both, a micro and macro level, we need outsourcing.
Quote:
Originally Posted by RedRage
Yes, these are broad and probably have holes in them but if we can get people hired and working, the government can tax those incomes and offset the tax revenue losses from corporations.
I'm in complete agreement with suggestion #1 of course, Suggestion #2 and #4 aren't practical.
As for Suggestion #3, no corporation in America pays the marginal 35% rate. The corporate tax in America is choke full of so many loopholes that many corporations end up either having no tax liability at all (which is BS) or an effective rate lower than what corporations in most other countries pay.
I'm pretty sure that he intended for #1 to be a prerequisite to #3. Thus the loopholes would no longer exist.
This is silly. Insourcing everything is a very inefficient way to operate. If we want to remain competitive on both, a micro and macro level, we need outsourcing.
He meant offshoring.
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