Step One:
The government should reduce taxes to people to give them money to spend. This will cause the government to run a 'temporary' budget deficit. People will spend this money and cause products to run low in stores, then stores will have to buy from wholesalers, then wholesalers will have to buy from factories, then factories will have to hire people to make more products.
People will then earn money to buy products to keep the economy running. The government will tax the worker's earnings to eliminate the budget deficit.
Step Two:
Reduce taxes to companies, to reduce their overhead, so that they can improve their operations, in order to hire more people.
Step Three:
Find every way possible, to help entrepreneurs who need capital and other assistance, to start new businesses so that they can start employing people. When any city, state or country wants to attract companies into their area, they must offer as many 'incentives' as the can to attract new businesses. For any company to move to another location, there is considerable expenses involved, let alone all the new laws they must abide by.
That is the 'positive way' to stimulate the economy.
The 'negative way', to stimulate the economy, is to take money from the rich and 'give to people' or borrow money and 'give to people' or print money and 'give to people.'
When the government takes money from the rich and gives to the poor, you punish the rich for being successful, which discourages them and other people from striving to become successful. This is called 'Robbing the Rich to Enrich the Poor.'
Theodore Roosevelt, Jr. said: “To say that the thriftless, the lazy, the vicious, the incapable, ought to 'have the reward' given to those who are farsighted, capable, and upright, is to say what is not true and cannot be true. Let us try to level up, but let us beware the evil of leveling down.”
It is not 'progressive' to give anything to anybody, who did not earn it, unless the receiver is helpless or disabled.
When the government gives money to people, that they have 'never earned', they make them lazy, dependent on the government and those people just want the government to give them 'more'. The more the government does for people, the more they want.
When the government borrows money, this throws the government into debt, which people will have to pay back in taxes, which takes away the money people would spend to keep the economy growing.
When the government prints money, this causes inflation (when and if that excess money is put back into circulation), which reduces the buying power of the people, which hurts the economy.
Concerning Social Security:
Social Security was supposed to be set up as a retirement system for those workers who 'paid' into the system but has been expanded into a general welfare ponzy scheme which is doomed to fail. The money put into this system should have been set up in a trust fund, collecting dividends, that was 'untouchable' by the government and 'paid out' to those who 'paid in'. Those dividends would come from companies that gain economically from increased purchases of their stock and enhanced loyalty from their stock holders.
Concerning Medicare:
Medicare should be a Health Care System set up for those workers who paid into the system and not for any other person who did not pay into it.
A 'General Welfare and Health Care System' should be set up as a charitable system, which would be funded by the rich, who would get generous tax deductions for their contributions, giving them a much desired tax shelter. This is the positive way to get money out of the rich. The negative way is to tax them so much that they leave the country. The people who benefit from this system would also have a co-pay depending upon their able to contribute.
A 'General Welfare And Health Care System' would work just as effectively as numerous charities work successfully all over the world.
Concerning Unions:
Unions are important only in those companies or governments that do not treat their workers fairly. However, when unions get so strong that they demand more than what they deserve, then eventually they destroy their very sources of income.
Concerning the Depression:
President Roosevelt failed to bring America out of the depression because he was using money, from various sources, to fund 'work programs' that produced 'nothing'. When the war started, he then used that money to hire companies to fund the war, which gave people real jobs instead of fake jobs. During the war, products and commodities were scarce and rationed, especially gasoline. Because of this American savings went up. When the war ended, along with shortages and rationing, the pent up buying power of those savings was what brought America out of the depression. So to give Roosevelt credit for ending the depression is ignorant.
Concerning Borrowing:
No person, no company and no government should ever borrow money for any purpose whatsoever unless the result of that borrowing will produced positive economic results, meaning a positive ROI,(return on investments). Borrowing money to purchased things to satisfy desires or to buy things you want and don't really need, is economic stupidity and the pathway to economic destruction.
Concern Income Taxes:
All income taxes must be very simple for the average person to understand. All taxing on people must be fair to everybody. All taxing must be done so that it actually stimulates economic activity instead of a way to control everything people do do by government bureaucrats.
Concerning Big Government:
Concerning the FED:
The Federal Reserve Board is an illegal organization, started in 1913 by big banks. Our constitution does not allow any other body to print money outside of the US Government.
The FED should be auted
To sum up: Any economic system that is going to work must make 'economic sense', to all persons involved, for it to be a sustainable system.
This is the 'Economic Cycle of Perpetual Economic Growth,' which no nation on earth practices in any consistent pattern at all and that is the reason why the world right now faces serious economic problems.
Copyright (c) 2010 Donald Richard Ballard
