Terrorism, Gay Marriage, or Global Warming bigger threat? A: None of the above. It’s debt that’s more likely to have a negative impact on your way of life. Both personal and government debt are likely to drag the economy down and cost you your job if changes aren’t made to tax policy and credit practices.
Gary Shilling discusses the coming recession in Forbes. I’m not sure I agree completely with his emphasis on the housing market – I think credit card debt is as much an issue. But either way, much of our apparent prosperity is built on a shaky foundation of debt and inflated real estate. I don’t propose direct government intervention in the consumer credit market but tax policy shouldn’t shield creditors from the risks inherent when they extend credit to questionable cardholders. If they extend credit imprudently, they should have to bear the risk of that loss without tax offset. That’s at least one of the reasons we need to get away from a system of income taxation, and go to a system of consumption taxes. Likewise, our government debt is dragging us all down. At roughly $30,000 of debt for every man, woman, and child, just the interest could fund health insurance for us all. We need to make sure that the money we take from Americans, from whatever tax source, is used productively, not merely to provide investment income to the big-money investors (many foreign) who finance our frivolous government. Michael Previous: Can I Take a Spin Around the Track? -- Next: Xcel-lent! GOP 2008 Convention in St. Paul MN. Comment from John Eyler: A consumption tax is a great idea. I’ve joined the Fair Tax group. They have an odd but at least workable proposal listed as HB 25 and S25. Further why would I want to use that money to provide health care. Fix the system don’t throw money at it. Posted by John Eyler Sep 26, 06:05 PM # Comment from Michael Smith: You’re absolutely right John. If “we” had the money back from the interest on the national debt it should be the taxpayers to decide how to spend it. I might buy health insurance, you might invest for retirement, and my neighbor might buy cigarettes and bourbon. The choice should be ours individually, not by government committee. Posted by Michael Smith Sep 26, 07:53 PM # Comment from Paul Davis: The comments about health care are a bit surprising to me. I’m going to argue that we not give any more tax money to insurance companies. Between Health Savings Accounts and the new medicare drug scam, I think the insurance companies are getting enough government subsidies. Ok, on to my real comment ;-) Eliminating/reducing the national can fix the social security crisis and the economy. Bonus point for long terms economic strength. Now for a politician that can see further than the next election cycle…. Some interesting bits, Even though we have the highest debt of any country, we rank number 35 in debt/GDP. So, its not all bad. Posted by Paul Davis Oct 2, 05:41 AM # |
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