Taxes

First, a little history. Originally, income taxes were only for the top tier of earners. It’s still mostly that way. The Top 20% of wage earners pay 90% of the taxes. After every tax rate reduction (under Kennedy, under Reagan, and under Bush II), revenues went up due to the economy being stimulated. When the government increased tax rates (Herbert Hoover, F D Roosevelt, Johnson, Nixon, Carter, Bush I, Clinton), within two years revenues decreased due to a downturn in the economy. And contrary to current popular wisdom, Bush II’s tax cuts shifted a larger burden of the tax collection from the poorer to the richer. In 2006, the top 5% of U.S. taxpayers, those with gross annual incomes of at least $153,500, paid about 60% of all income tax collected, while reporting only about one-third of the total income of the U.S. This is up from 55% under Clinton. The top 20% pay 80% of the taxes.

The current tax rates are about right and should be extended before they expire in 2010. Some minor adjustments can be made to optimize revenue. Raising taxes on the rich only ensures that they will not be able to hire as many people, spend as much on goods, or take as many vacations. This is disastrous to the middle class, since the money would go to them. The poor shouldn’t be paying taxes—however, neither should we use “tax rebates” to “redistribute wealth.” This only encourages laxity.

Let’s get one thing straight—corporations don’t pay taxes, consumers pay them. Before you think about “soaking the corrupt corporations,” ask yourself, “Do I want the cost of everything I buy to go up?” Let’s leave corporate taxes where they are.

Inheritance taxes destroy small businesses, which employ half of all private sector employees, pay nearly 45 percent of total U.S. private payroll, and have generated 60 to 80 percent of net new jobs annually over the last decade (according to the SBA). Even if let the current inheritance tax holiday expire, we must eliminate all inheritance taxes on small businesses to keep our economy strong.

Pollution

Since 1960, we in the U.S. have reduced the pollutants making it into our environment by over 90%, even though we have nearly doubled our industrial output. How? With higher technologies. High-tech doesn’t pollute nearly so much as low tech. The biggest remaining polluters are China, India, and Russia. Smaller third-world countries are polluting correspondingly. We must freely share our clean technologies with the new emerging industrial bases and insist through treaties that they responsibly enter the manufacturing world. The major portion of our foreign aid should go to this end.

We still have some problems: illegal dumping, new pollutants from the electronics industry, and farming runoff. One thing will stop rampant illegal dumping: heavy enforcement. Polluters must be fined more heavily and jailed longer—these are crimes against many people as well as against our plants and animals.

Energy Policy

We must keep energy cheap and available for our people. We must not burn our food supply, as we are currently doing! Instead, we must follow a three-step program:

(1) Short term (1 - 5 years). Drill here. Drill now. With the technological improvements in drilling techniques, the danger of spills like we saw in the past is almost gone. We must drill in ANWR and off our coasts to supply our oil and natural gas needs. We must continue to mine coal and to use our best, cleanest methods of burning it to generate electricity.
(2) Medium Term (5– 15 years). Build more nuclear power plants based on French technology. Long-term storage of nuclear waste is not a problem. In the past it was believed that we would have to store the waste products for thousands of years. We now know that is not true: a mere one or two hundred years is all that’s needed.
(3) Long Term (15 – 30 years). Encourage the development of wind, tidal, recyclable waste, no-food bio-fuels, solar, and other technologies through both direct government investment and tax incentives. We don’t know what the next breakthrough will be. Therefore, we must start a myriad of small investments in many potential technologies, then weed out those that show no promise after a few years.