Quote:
Originally Posted by Rggr
I'm curious to hear your thoughts on the stimulus proposal made by Congressman Gohmert.
"There is currently "$350 billion of the $700 billion bailout still available to Paulson pending Congressional approval."
"According to American Solutions, a conservative think tank founded by former Speaker of the House Newt Gingrich, Americans pay $101.6 billion per month in personal income tax and $65.6 billion per month in FICA tax."
"Gohmert is currently preparing a bill to declare a tax holiday for January and February of 2009 and is also gathering support at the same time. He said, “We can save more home mortgages, increase employment, and boost economic growth for a lower price tag with this plan than with any centralized bureaucratic program, all by giving the power back to the taxpayers. I am demanding that not another penny goes to executive bailouts, but these billions of taxpayer dollars should go to the taxpayers who earned them."
"Americans could take and invest their own money where they believe it should go - to paying down mortgages, buying a new car, making credit card payments. The economy would get relief where it is needed the most. Why try to decide how to prevent foreclosures? Just give taxpayers their own money to catch up on their payments. Those in lower income brackets who are hit the hardest by the FICA tax would see huge money back, and then THEY could choose who should benefit from their hard earned money. Even the self-employed and small business owners would receive a fantastic amount of their own much-needed money, and they will be able to invest that back into their businesses and even create the ability to hire more people.”
Press Release from the Office of Congressman Louie Gohmert - 1st District of Texas (http://gohmert.house.gov/Article.aspx?NewsID=1355 - broken link)
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: ponders deeply : Just as in life, if a deal sounds too good to be true, then something is wrong with that deal. What would I be endangering, risking or giving up to enjoy my 2 month tax holiday?
: talks to himself for a moment : As a responsible Christian (value system), my duty is to the innocent children and the elderly.
How would my holiday impact the State Children’s Health Insurance Program, Social Security, Medicare and Medicaid? Would my holiday affect the Safety net programs (SSI, food stamps, school meals, programs for abused children, etc.)?
And my next concern would be the effect on Military, Public Education, Benefits for Veterans, etc. Could I enjoy my tax holiday if any of these things are adversely affected? I know I could not.
Where Do Our Federal Tax Dollars Go?
Now if I am asked if I believe Rep. Louie Gohmert's assertions that people would spend and stimulate the economy, I would say no. He also knows that's not true with the last stimulus package mailed to the populace. People tend to save when insecure about home and job. Also they tend to pay bills which would not stimulate the economy.
Therefore to find commonality with Rep. Gohmert, I would have to have a meeting of minds on another level. He states, "Why try to decide how to prevent foreclosures? Just give taxpayers their own money to catch up on their payments."
Press Release from the Office of Congressman Louie Gohmert - 1st District of Texas (http://gohmert.house.gov/Article.aspx?NewsID=1355 - broken link)
I find that assertion simplistic, if not for the simple reason that poor people have very little taxes given to the government and any FICA taken from their checks surely couldn't catch them up on lapsed mortgage payments. That is also true for the middle class. So knowing he knows this, I suspect this isn't his motivation.
Going back to the beginning of the article, he states "We need to give this money to the people who earned it. I am sick of Washington millionaires (Senate, Paulson?) trying to decide which of their cronies (Wall Street?) should get the next wad of taxpayer money,"
So the resentment is toward Wall Street. Will my tax holiday solve the problem of bankers bailouts? And the answer is no. In fact, the bankers are holding to the bailout (funds) because they can't get rid of CDOs on their balance sheets. There are no guarantees that small businesses would spend any relief funds they have either.
washingtonpost.com (link from UpperPeninsulaRon in another Thread)
So at a time like this, my tax holiday does not solve the problem and, in fact, would exacerbate conditions in the country toward a possible depression. At present we still have post office, forestry and land management, and the multitude of federal services extended to our neighbors and our state.
Also while the majority of working people are enjoying their two-month holiday, the wealthier inhabitants are finding ways to move large sums of money from off-shore, sell stocks, and all properties to avoid paying taxes. This would be devastating for the market and the economy.
If I were in the service of a foreign global business, I would push this idea since it presents a great scenario for guaranteeing future economic weakness, which would allow me to further exploit policy making in Washington, D.C. America would need me (China, Saudi Arabia, Japan, etc.) to buy more debt thru bonds, and future policy creation would benefit me overwhelmingly.
So as a Christian Patriot, I would have to decline Rep. Gohmert's seemingly benevolent offer. Maybe I'd find it a little too "Keynesian".
"... if the poorer segments of society are given sums of money, they will likely spend it, rather than save it, thus promoting economic growth."
A simple explanation of Keynesian Economics.
What is Keynesian Economics?
More Advanced History of Keynesian Economics.
Keynesian economics: Facts, Discussion Forum, and Encyclopedia Article
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