With every new administration there are always different issues that need to be addressed. But one issue that continues to be a hot topic, the economy its current state.
By J.T. White
Acting Chair of the SHU College Republicans
With every new administration there are always different issues that need to be addressed. But one issue that continues to be a hot topic, the economy its current state.
Over the course of many years there have been many theories proposed by different individuals as to what is the most effective and appropriate way for an economy to be run. Many say raising taxes on the people, to provide more funding for the government is the best way to run it. Others believe there should be a flat tax and everyone pays the same taxes. Some believe the complete capitalist system is flawed and needs to be done away with. In conservative fundamentals, none of these are the answer to the constant question of the economy.
If we get down to the roots of conservative fundamentals for the economy we will see the most basic principle is tax cuts. This is possibly the most effective way to stimulate the economy for growth, more so than creating a stimulus bill to jump start the economy. Essentially, tax cuts are cutting down on the cost of taxes for the American people, giving back to them and putting more money in their pockets so they can go out and spend it. John F. Kennedy, the 35th president of the United States and a lifelong democrat, was a staunch advocate for tax cuts. But today’s Democratic Party wants nothing to do with the idea of tax cuts.
A tax that could be done away with to help stimulate the economy is the Capital Gains Tax. In essence the Capital Gains Tax is a tax that is a tax charged on capital gains where the profit realized on the sale of a non-inventory asset that was purchased at a lower price. The most common capital gains are realized from the sale of stocks, bonds, precious metals and property. This means small businesses are taxed on profits they make which could be put towards growing their business, and hiring more people, which in turn would expand the tax base by having more people pay taxes to the government. This way the burden would not be put on the upper class.
The stimulus bill was completely unnecessary. If the economy was given a little more time to work the kinks of the recession out, then we would be fine. So far sources have stated the stimulus bill promised that the unemployment rate would not rise above 8%, when in reality it has risen to 10% with no sign of stopping. The stimulus bill also promised to shove ready jobs for many Americans in this country, but so far these jobs have not been materialized. The stimulus bill was supposed to be the solvent to America’s economic crisis, which in truth, has only worsened the situation at hand.
There are proven methods on how to run an economy without overtaxing its citizens. If the current administration would focus on tax cuts, then they would be surprised as to how fast it could stimulate the economy. When money is put back into the hands of the people, it makes them want to go out and spend it. The same is for small businesses, if the government taxes them on their profits then how can anyone expect them to even make a profit in the first place? They won’t be able to get new employees and expand their business, so essentially they are destined to be a small business for the rest of their existence.
If the current administration would give money back instead of taking it away, they would see the recession fix itself a lot faster.