We are 1.2 trillion a year falling into fiscal disaster with debt. And it’s going to swallow us up whole.
What is the solution? Certainly that 750 billion defense budget has to get trimmed back. But let’s do some simple cutting math. If we cut defense by 100 billion, cut back welfare 100 billion, and somehow cut wealth handouts 100 billion, that’s only 300 billion. so basically, we can’t get there by cutting alone.
The biggest GAP and most unfair situation in our taxation plan is were huge megacorps get to have tens, hundreds of million, nei billions in sales, yet pay zero taxes. This is the big gap. so the dollars flow into the 150 billion dollars that Bezos et al etcetera all those too rich bozos who really aren’t that smart.
There is a simple solution. We have an AMT tax on individuals. Alternative minimum tax. We need to add one for business. If you have OVER 100M in sales, then you must pay at least 4% tax. These are net sales not profit. So the percentage doesn’t need to be so high.
Let’s do the Amazon math. Current taxes paid 2018 = 0. 2018 net sales = $25.7 BILLION. That’s One billion in taxes we’d take in from Amazon, GE, Microsoft, and other huge companies that paid no taxes. Projected revenue = 300 billion.
OK so we are getting close but we aren’t quite there. Next, since they have moved to financialization which rips dollars away from real producers and puts it into fantasy financial land, it makes sense to have a very low tax – 0.01% – on financial transactions. That would bring in another $300 billion.
Finally, we need a bit more to pay down the deficit. Well that should come from tariffs. A 25% tariff on Chinas 600B would generate 125 Billion. Tariffs should be based on rules. Do they cheat, do they steal, whats their highest tariff on our products?
BUT if we accept these new taxes then there have to be strict spending controls on government expansion. In any year where the government spending exceeds 4% growth then the taxes would be reduced by 50% in the following year. If they do it again, the new revenue streams would reduce to 25%. So if they don’t stick with it, if they march us to financial armageddon rather than follow fiscal responsibility, then it’s really going to get bad fast.
The interest on our debt is pushing 500 BILLION dollars a year, and we only take in 3,500 billion a year. That’s one seventh our tax base being wasted.
It will only end when people start feeling the bite of the inflation that is getting worse and worse. Dollar devaluation. Bond rate collapse. It’s probably just five or ten years away. Then we all starve to death. Is it worth doing something before then? Yes. Will Trump act? No. It’s sad really.