The essential component of the
disaster recovery plan than being outlined here is the formation of a American Citizens Trust (ACT). This
would be a similar institution to Fannie Mae or Freddie Mac which would invest in a basket of companies
traded publicly in the stock market. Each citizen of the United States
would be a shareholder in this investment trust. The trust would be initially capitalized through one or more of the
following options.
•
A revision of the
income tax system to reflect a flat rate for every individual.
•
A revision of the
corporate tax rate system whereby every corporation with pay a minimum of 20%
of revenues regardless of the location in the world where these revenues are
realized.
•
A Federal Reserve fundinging
structure
Are the tax rate revisions described
above the best ones? Further study on this would be required. I contacted the
Congressional Budget Office and asked them to research this. They wrote back
telling me that they would be delighted to do so as soon as they finish
straightening out Washington DC.
(Another option
for generating the investment trust is to adopt the American Monetary Act
whereby the power to create “Green” money is transferred from private banks to
the US Government. http://www.monetary.org/amacolorpamphlet.pdf)
Given that a substantial amount of
money could be raised by the vehicles described above, the question then
becomes what to do with all this money. The traditional option is to write every citizen a check for whatever
amount of money is required to share in the trust equally. I do not favor
this approach.
A better approach would be to invest this ACT in a basket of companies,
particularly those that are judged to be more advanced in automating their
processes. This of course opens up a
Pandora's box of political chicanery since it would be up to the directors of
the ACT to choose, and thereby perhaps
favor, some companies over others.
An alternative to this might be to
require the ACT to be invested in all companies in the S&P 500 list in
proportion to their size. Other schemes could be developed for ensuring that
the ACT is invested in a wide variety of companies in an equitable manner. I'm
sure this CBO will be delighted to take this project on also, once they finish
straightening up Washington DC of course.
So what do we have so far? A large
amount of money will be generated through tax code revisions and federal
reserve type investment to be reinvested equitably in a wide variety of
American companies. Every American citizen would be a shareholder in this trust
and receive quarterly earnings from it. I the next post, we will deal with our second question:
On what basis will the income generated by
the ACT be distributed?
1 comment:
A revision of the income tax system to reflect a flat rate for every individual.
This is very bad idea!! The rich will reap a large tax decrease! The poor will have a large tax increase. This is a red herring proposal supported by rich people. Let's say the flat tax is 20%. You then have a 100% increase for those who pay 10% today. And for those who pay 40% today, you have a 50% reduction. Don't fall for this false straw man.
A revision of the corporate tax rate system whereby every corporation with pay a minimum of 20% of revenues regardless of the location in the world where these revenues are realized.
Very bad idea!! Caterpillar has sales of 56 Billion in 2013 and paid 1.3 Billion in Income Tax or 2.3% of sales. With a tax of 20% of sales, the tax would be 11.2 Billion. This would entirely wipe out after tax profit of 3.8 Billion. You would force the company into Bankruptcy.
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