Tuesday, April 6, 2010
Volcker: Raise Taxes to Curb the Deficit
Paul Volcker says that the U.S. will probably need to raise taxes to curb the deficit.
Specifically, at a speech to the New York Historical Society, Volcker said that America should consider imposing a "value added tax" - a type of national sales tax used in Europe - and also carbon or other energy-related taxes.
Of course, Herbert Hoover raised taxes in 1932, with disastrous results for the economy.
More importantly, instead of raising taxes or cutting services, why don't we just stop unnecessary wars, unnecessary bailouts and unnecessary interest costs - and claw back the ill-gotten gains from the too big to fails?
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And if taxes are really needed, why not impose a STET tax or a Tobin tax?
ReplyDeleteA consumption tax defeats any economic stimulus, but the STET and Tobin tax target the looters.
Even if we could stop the wars and end the bailouts, neither of which is politically feasible, we still would not be able to produce enough of a surplus to push the economy out of recession. We do need an increase in taxes. I would favor a repeal of the Bush tax cuts and the Reagan tax cuts, exempting only those taxes that would affect Americans earning under $100,000/year.
ReplyDeleteIf we are going to create permanent, well-paying jobs in this economy, the government is going to have to spend a lot of money that it does not currently have. The most prudent way to do this is to raise taxes on those who have benefited most from the bubble economy, while ending bailouts, nationalizing and breaking up the TBTF financial institutions, getting health care costs under control, and ending our imperial ambitions and reaping the peace dividends we never received after WWII or the Cold War. Of course, we must recognize that none of these things is going to happen. Our government is so corrupt and dysfunctional that it cannot even bring itself to discuss any of the measures that actually have a chance of working.
No surprise here. Hit the consumer before he can get back up. Make him need you for his daily bread. Get out of debt asap people.
ReplyDeleteand claw back the ill-gotten gains from the too big to fails? -- Because there is a reason they are too big to fail. They call the shots in the US gov not the other way around.
ReplyDeletewhy are people not in the streets *demanding* an end to the unnecessary wars, bailouts, costs etc.??!!
ReplyDeleteit's high time to overthrow the corporations including banks and pentagon related companies who actually call the shots. the government should work for us, it's time to make it so. 'operation mayhem' will just be the beginning.
to withdraw from our two wars is completely politically feasible. it worked just great for vietnam, and the same will be said for iraq and afghanistan when we finally drag out 20 years from now....unless people get into the streets NOW.
what's everyone so afraid of??!! afraid to get to know your neighbor a little? afraid of having to sacrifice luxury or things or perhaps your life?!?
I thought there were NO more earthquakes than normal. Who said that?
ReplyDeleteIf that's true, then, why are so many people lying on the ground under all this rubble?
Life is but a dream... Or, at least, if it's not just a bad dream, that's as close as anyone has come to describing it adequately -lately.
thank you charles D! yes taxes are too low, and just wanted to add that corporations *must* be taxed exactly the same as individuals, if not more since they are more than one.
ReplyDeleteHow about hitting "luxury" items only with higher taxes. high end items (cars, boats, jets, luxury homes, etc.)
ReplyDeleteAlso, nail fast food and make it more expensive than staple food, fruit and vegetables. Make food stamps only applicable on the latter items to curb lower income people to healthier foods.
and institute a value-added tax of 1-2 % across the board - paid directly onto the deficit - no monkey work allowed for pet projects.
Our country is blazing towards a "critical mass". A moment where we can not retreat from the edge and are forced to loosen our toehold on the edge and simply free-fall. We will pick ourselves back up but we will be a country fragmented. We will be something new and dramatically different. Our country must apply the brakes immediately and deliberately.
ReplyDelete