If you listened to the recent Republican debate, you heard some pretty dumb ideas when it comes to job creation and deficit reduction. Cain wanted to cut the capital gains tax to zero. Santorum wanted to allow offshore drilling. Pawlenty was big on tax and deregulation as were all the others. And, of course, they all wanted to repeal health care reform, abolish or privatize Medicare, Medicaid, Social Security, and end food stamps, the EPA, the National Labor Relations Board, the Federal Emergency Management Agency, and NASA. They all made it clear that they opposed a woman’s right to abortion and gay marriage but they were all in favor of forced prayers in public schools and using tax dollars to fund religious schools. And, of course, they all rejected any kind of tax increases or reduction in tax expenditures.
There wasn't much new in their proposals, just a rehash of a lot of really stupid ideas that either had nothing to do with job creation or would make the economy and deficit worse, not better, if adopted. Practically all of their ideas would create more income inequality by making it easier for the rich to get richer and would place additional burdens on middle-income and poor working families.
So, are there any new and truly creative ideas about how to fix the economy, create jobs and lower the deficit without making conditions even worse for those who have suffered the most from the recession? You betcha as SP would say. Here are a few of the most promising--all of which Republicans are blocking.
Shortening work hours to create jobs
Paul Krugman and Dean Baker have suggested that employers be given a tax credit to shorten workers’ hours in the form of paid sick leave, paid family leave, shorter work weeks or longer vacations. Workers would receive paid time off so their salaries would be the same. Employers would have to hire more workers to make up for the lost labor input. Michigan Congressman John Conyers has introduced a bill called the SHARE act that would accomplish this by offering employers who shorten hours a $3,000 tax credit. Would this work? Germany has had in place a similar program that is credited with helping it keep unemployment during the recession to 7.6%.
21st Century Civilian Conservation Corps
Ohio Representative Marcy Kaptur has introduced legislation to create a Civilian Conservation Corps patterned on the successful New Deal program launched in 1933. During that program, which lasted for nearly a decade, thousands of Americans who had lost their jobs due to the Depression were put to work building bridges and dams, planting trees in national forests and public parks, putting out forest fires, building roads and hiking trails in the nation’s parks, and so on. If you visit a national park today, you will see and use the product of their efforts. The new Civilian Conservation Corps would put unemployed and underemployed Americans to work on useful public works projects aimed at safeguarding natural resources and developing new transportation and infrastructure. This is something that should have been part of the original stimulus package but with unemployment still high, it is not too late for such a program to have an immediate impact.
Extra tax on millionaires/billionaires
House Democrat Jan Schakowsky (D, Illinois) and twenty other House Democrats have co-sponsored a bill to add two additional tax brackets one for those with incomes starting at $1 million and another for those with incomes starting at $1 billion. The idea is that it is not fair for billionaires to pay the same top tax rate as people who make 2,500 times LESS than they do. It is estimated that the Fairness in Taxation Act (FTA) could bring in $78.9 billion in 2011 alone, more than enough to cover the GOP-proposed cuts to Pell Grants, community health centers, high speed rail, Head Start, NIH funding, housing cuts and Title X family planning. Note: Not only would these highly useful programs be save but so would the jobs they fund. An alternative to the FTA is to simply impose a temporary surtax on millionaires/billionaires until the deficit reaches a certain level.
Financial transaction (speculator’s) tax (FTT)
This proposal would impose a small tax (for, example 0.25%) on stock purchases and sales, futures, options, or credit default swaps. The Center for Media and Democracy says that an FTT would have the following benefits:
- A FTT would raise over $100 billion per year in badly needed revenue or one trillion over the course of a decade that could be used to create jobs, help our states weather the financial crisis and support critical public services.
- A FTT would reduce dangerous financial market speculation. Since the tax would hit high-volume, high-speed trading the hardest, it would serve to discourage short-term speculation in financial markets as well as the proliferation of ever more complex derivative instruments. More complex derivatives could be subject to the tax many times over, substantially reducing the potential profits from complexity.
- A FTT would encourage longer-term productive investment. By reducing the volume and profitability of short-term trading that serves no productive purpose, the tax would encourage Wall Street to find new ways to make money off of longer-term productive investments.
These are all good ideas that would have a big impact on creating jobs, reducing the deficit over the long term and saving critical programs that are endangered. Unfortunately, the Republicans are fighting all of these innovative ideas and insisting on the same old things they have been proposing for decades—cut taxes (especially for the rich), reduce the size of government, and privatize, privatize, privatize (even though it usually costs more for the private sector to do almost any job.)
Click on the links below to read more about the REAL deficit reduction/job creation ideas I’ve discussed and many I have not discussed.