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Ten Fair Ways to Reduce the Deficit and Create Jobs -- Senator Bernie Sanders


Society & Culture  (tags: abuse, americans, children, corruption, dishonesty, education, family, government, health, Jobs, media, politics, safety, society, Taxes )

Kit
- 264 days ago - sanders.senate.gov
At a time when we are experiencing more wealth and income inequality than at any time since the 1920s, and when Wall Street and large corporations are enjoying record breaking profits, I believe that we should be asking the very wealthiest people-->



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Kit B. (277)
Friday November 8, 2013, 11:56 am
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Ten Fair Ways to Reduce the Deficit and Create Jobs


Republicans in Washington, D.C. want to balance the budget by slashing Social Security, Medicare, Medicaid, food stamps, education and other federal programs that millions of Americans rely upon.

I have a better idea. At a time when we are experiencing more wealth and income inequality than at any time since the 1920s, and when Wall Street and large corporations are enjoying record breaking profits, I believe that we should be asking the very wealthiest people in this country to start paying their fair share of taxes. That way, we will not only lower the deficit but we will bring in enough revenue to invest in our economy and create the millions of new jobs we desperately need.

From both a moral and economic perspective, we must not balance the budget on the elderly, the children, the sick, working families, and the most vulnerable.

Here are 10 examples of how we can raise revenue and reduce spending in a fair way.

1.) Stop corporations from using offshore tax havens to avoid U.S. taxes. Each and every year, the United States loses an estimated $100 billion in tax revenues due to offshore tax abuses by the wealthy and large corporations. The situation has become so absurd that one five-story office building in the Cayman Islands is now the “home” to more than 18,000 corporations.

The wealthy and large corporations should not be allowed to avoid paying taxes by setting up tax shelters in Panama, the Cayman Islands, Bermuda, the Bahamas or other tax haven countries. The first bill that I introduced in the Senate (the Corporate Tax Dodging Prevention Act) would raise more than $580 billion over the next decade by eliminating the most egregious corporate offshore tax haven abuses.

2.) Establish a Robin Hood tax on Wall Street speculators. Both the economic crisis and the deficit crisis are a direct result of the greed and recklessness on Wall Street. Creating a speculation fee of just 0.03 percent on the sale of credit default swaps, derivatives, options, futures, and large amounts of stock would reduce gambling on Wall Street, encourage the financial sector to invest in the job-creating productive economy, and reduce the deficit by $352 billion over 10 years, according to the Joint Committee on Taxation.


3.) End tax breaks and subsidies for big oil, gas and coal companies. If we ended tax breaks and subsidies for big oil, gas, and coal companies, we could reduce the deficit by more than $113 billion over the next ten years. The five largest oil companies in the United States have made over $1 trillion in profits over the past decade. Exxon Mobil is now the most profitable corporation in the world. Large, profitable fossil fuel companies do not need a tax break.


4.) Establish a Progressive Estate Tax. If we established a progressive estate tax on inherited wealth of more than $3.5 million, we could raise more than $300 billion over 10 years. In 2010, Sen. Sanders introduced the Responsible Estate Tax Act that would reduce the deficit in a fair way while ensuring that 99.7 percent of Americans would never pay a penny in estate taxes.


5.) Tax capital gains and dividends the same as work. Taxing capital gains and dividends the same way that we tax work would raise more than $500 billion over the next decade. Warren Buffet has often said that he pays a lower effective tax rate than his secretary. The reason for this is that the wealthy obtain most of their income from capital gains and dividends, which is taxed at a much lower rate than work. Right now, the top marginal income tax for working is 39.6%, but the top tax rate on corporate dividends and capital gains is only 23.9%.


6.) Repeal all of the 2001 and 2003 Bush tax breaks for the top two percent. In January, Congress finally repealed the Bush tax breaks for the top one percent – households making more than $450,000 a year. But the Bush tax breaks have been continued for the top two percent – households with incomes between $250,000 and $450,000 a year. Repealing the Bush tax breaks for all of the top two percent would reduce the deficit by about $400 billion over the next decade. After President Clinton increased taxes on the top two percent, the economy added over 22 million jobs. After President Bush reduced taxes for the rich, the economy lost over 600,000 private sector jobs.


7.) Eliminate the cap on taxable income that goes into the Social Security Trust Fund. If we are serious about making sure that Social Security can pay all of the benefits owed to every eligible American for the next 50 to 75 years, we don’t do that by cutting benefits, we do that by scrapping the cap on taxable income so that a millionaire and a billionaire pays the same percentage of their income into Social Security as someone making $40,000 or $50,000 a year. Right now, someone who earns $113,700 a year pays the same amount of money in Social Security taxes as a billionaire. This makes no sense. Applying the Social Security payroll tax on income above $250,000 would ensure that Social Security remains solvent for the next 50 years. This plan would only impact the wealthiest 1.3 percent of wage earners; 98.7 percent of wage earners in the United States would not see their taxes go up by one dime.


8.) Establish a currency manipulation fee on China and other countries. As almost everyone knows, China is manipulating its currency, giving it an unfair trade advantage over the United States and destroying decent paying manufacturing jobs in the process. If we imposed a currency manipulation fee on China and other currency manipulators, the Economic Policy Institute has estimated that we could raise $500 billion over 10 years and create 1 million jobs in the process.


9.) Reduce unnecessary and wasteful spending at the Pentagon, which now consumes over half of our discretionary budget. Much of the huge spending at the Pentagon is devoted to spending money on Cold War weapons programs to fight a Soviet Union that no longer exists. Lawrence Korb, an Assistant Secretary of Defense under Ronald Reagan, has estimated that we could achieve significant savings of around $100 billion a year at the Pentagon while still ensuring that the United States has the strongest and most powerful military in the world.


10.) Require Medicare to negotiate for lower prescription drug prices with the pharmaceutical industry. Requiring Medicare to negotiate drug prices, similarly to what the VA currently does, would save more than $240 billion over 10 years.
****

By: Senator Bernie Sanders |

 

JL A. (272)
Friday November 8, 2013, 12:22 pm
A very equitable list that would restore much that is out-of-balance economically and help restore our economy to where it was when everyone shared in the country's economic growth and prosperity.
 

Kit B. (277)
Friday November 8, 2013, 12:30 pm

Yep, that would go far to fixin' what's broke. I love Bernie Sanders, and it didn't take 3,000 pages to get to the point.
 

Gene Jacobson (247)
Friday November 8, 2013, 12:33 pm
Bernie makes so much sense and is so right, it almost makes one wonder what he is doing in politics because those qualities are so rarely found in most politicians. He is one of my heroes. And always a breath of fresh air, just when it is needed most.
 

Lois Jordan (55)
Friday November 8, 2013, 3:53 pm
Noted w/many thanks, Kit. I sent this list out to several people. So many are so unaware.
 

JL A. (272)
Friday November 8, 2013, 4:28 pm
I sometimes think Bernie chose as his model what was called 'the best and the brightest' in the days of JFK where people viewed public service as a privilege and honor not to be abused and when Congress wrote bills themselves (didn't take them from corporations, industries or their PR minions) and agencies hired experts in the issue area and wrote regulations to flesh out the details that would meet the intent of the law as stated by Congress--now it seems to be to set up corporations to receive contracts for the public who do not have reason to care whether what they do met the intent of a law or not, etc.
 

Shailja Mukhtyar (80)
Friday November 8, 2013, 6:50 pm
what happened to FDR's workfare, not welfare??
An incentive in the great depression that built the Empire State building, at the rate of nearly 1 floor ( size of one city block) per week, and building the worlds tallest building for 1/2 a century.

Workfare is for those willing to work, learn skills, succeed. Those who want to sit on their asses, collecting free services, who choose to do nothing... will never approve. .... sad sad world after all, its a sad world ,

when hard working majorities must give others a free ride... for years on end.
 

Robert K. (31)
Friday November 8, 2013, 7:31 pm
You don't really think the Republicans would allow A new WPA, CCC or NRA (National Recovery Act, not National Rifle Association) to ever get out of congress, do you? It's a great idea, and I believe you would find millions of people out of work would love it if it happened. The big lie of the lazy welfare recipient is still right wing policy and talking point.
 

JL A. (272)
Friday November 8, 2013, 7:39 pm
For more accurate view of who gets welfare see:
http://www.utexas.edu/depts/ic2/et/learner/general.html
National Studies and Statistics

In general, the reviewed national research finds welfare-assisted families moving in and out of the labor market. Many welfare recipients report only qualifying for jobs in low-wage, secondary markets; jobs that are often temporary, seasonal and/or part-time; jobs offering unstable work hours and neither healthcare nor family leave benefits. The need for basic supports such as child care and transportation assistance further limits their employability. (Nightingale)

"In an ongoing series of public policy reports, the Urban Institute in Washington, D.C. has collected data and research profiling the U.S. welfare population. The welfare population is characterized as mostly single mothers in their 20s and 30s with one or two children. The population is fairly distributed among the major ethnic groups and covers a wide range of educational attainment. Most welfare recipients have some work experience. "
"A General Profile of the Welfare Population – Urban Institute
90% of welfare parents are single mothers

10% married

36% divorced/widowed/separated

54% never married

Most welfare mothers are in their 20s and 30s

6% under 20 years of age

24% 20-24 years of age

22% 25-29 years of age

35% 30-39 years of age

13% 40 years of age or older

Welfare mothers are distributed among the major ethnic groups

37% White

36% African-American

20% Hispanic

6% Other

Academic levels of welfare recipients cover the full range of educational attainment

16% some college

42% completed high school

42% less than high school

Most welfare recipients have 1 or 2 children

41% 0-1 children

33% 2 children

16% 3 children

10% more than 3 children

Majority of welfare recipients have recent work experience

30% no recent work experience

70% some recent work experience

4.2 years average work experience

43% have worked in past 24 months

Average weeks worked in 24 months is 24 weeks"

You are quite right Robert.


 

Bill and Katie Dresbach (79)
Friday November 8, 2013, 8:49 pm
Thank You for the Interesting Article Kit
 

Jonathan Harper (0)
Saturday November 9, 2013, 2:16 am
noted
 

Kerrie G. (135)
Saturday November 9, 2013, 2:24 am
Noted, thanks.
 

Jennifer C. (172)
Saturday November 9, 2013, 4:04 am
Thanks.
 

Carmen S. (606)
Saturday November 9, 2013, 4:19 am
Thanks Kit.
 

Michael Kirkby (83)
Saturday November 9, 2013, 7:02 am
I love Uncle Bernie. How about reinstituting Glass-Steagall; repealing the Monetary Control Act and repealing and closing the Delaware tax loopholes? Then you can pursue offshore banking.
Then a tax on the rich and their corporations would have meaning.
 

Michael Kirkby (83)
Saturday November 9, 2013, 7:05 am
Until we eradicate the influence of lobbyists who petition our leaders relentlessly our legislation will always benefit the large corporations and investment bankers and other speculators such as foreign nationals.
 

Anne P. (245)
Saturday November 9, 2013, 7:21 am
Bravo, Bernie. I have such respect and admiration for you. In a perfect world. you would be our president.
 

Terrie Williams (762)
Saturday November 9, 2013, 8:49 am
Dawg how I LOVE that man! Common sense policies. But will the congress/senate ever, EVER go along with those....hell nooooooooooooooooooooooooooooooo. Because it would INCLUDE a lot of THEM.

Wish Bernie were 20 years younger and could run for Prez. I think he'd get 80% of the vote.
 

GGmaSheila D. (134)
Saturday November 9, 2013, 10:26 am
Seems to me tat Obama tried to get something set up to put the jobless back to work rebuilding our infrastructure but it was shot down...he hasn't done anything since.
Love: The Buck Stops Here - too bad the buck seems to always go to whoever in Congress can be bought.
 

Past Member (0)
Saturday November 9, 2013, 12:57 pm
11. Establish a state public bank in every state.

12. Eliminate the criminal enterprise known as the Federal Reserve, and print our own money at 0% interest.

 

Theodore Shayne (56)
Saturday November 9, 2013, 1:36 pm
Noted & posted
 

Debra Tate (17)
Saturday November 9, 2013, 1:43 pm
Noted! Good points!
 

Birgit W. (140)
Saturday November 9, 2013, 2:39 pm
Thanks for sharing.
 

Kathleen R. (138)
Saturday November 9, 2013, 3:58 pm
noted & read
 

Kit B. (277)
Saturday November 9, 2013, 6:11 pm

Thanks J L for clarifying who does receive the little welfare that is given. The number of people that sit a home and do not want a job is infinitesimal, not really worthy of comment. Nearly one million of troops in need of SNAP have just had that very small help taken, along with the children and elderly.
 

Bryan S. (98)
Saturday November 9, 2013, 7:37 pm
A Republican: Someone who demands the "lazy bums" get jobs while demanding that nothing is spent to create jobs, and he is fine with cutting existing jobs.
 

GGmaSheila D. (134)
Sunday November 10, 2013, 3:18 pm
Very sad to say Both MN Senators, Franken and Klobuchar, voted Against a bill of Saunders...very disappointed. Can't remember the exact bill, but was just this last week and a half...and was against every Liberal bone in my body.
 

Anne F. (17)
Monday November 11, 2013, 7:29 pm
Federal tax on estates of more than 3 million dollars makes sense. Hooray for Senator Sander's Responsible Estate Tax Act
 

Bryna Pizzo (139)
Tuesday November 12, 2013, 3:41 pm
If only they would listen to Sanders, the country could be restored. Unfortunately, I don't believe they listen to him. My dearest wish would be to have Warren for President and Sanders for Vice President. Thank you for sharing, Kit!
 

Stephen Brian (23)
Tuesday November 12, 2013, 11:10 pm
I like some of these in principle, but I am concerned by the practical problems in implementing the needed changes.

Estate-taxes always run into problems associated with farms and other high-asset-to-profit businesses. Attempts to get around such problems often produce loopholes which can then be exploited. I think such a tax may be appropriate, but care would have to be taken to make it work without doing something like jeopardizing the country's food-supply.

The biggest tax-breaks for oil companies are the breaks for manufacturing in the U.S. (of which oil-refinement is a part) and energy-production from non-officially-listed reserves. The first is important to maintain manufacturing economic cores while the second is actually the tax-break that promotes cleaner energy-sources. Again, trying to make this work in a legal way without destroying valuable industries is a serious challenge.

The swap-fee looks good, but there is a game-theory problem: Not all stock-traders fall under U.S. jurisdiction, and those able to trade quickly will prosper a the expense of others. If they could all be regulated in the way that Sanders wants, then the markets would be stabilized and they would actually benefit (along with everyone else), but doing this only to U.S. traders could pose a problem for the country without really stabilizing the market much. Cutting income and revenues from income tax would at least partly offset the revenues from the fees, potentially even driving the net-revenue negative. (I have not seen any research on how large the effect of the fees would be on income and directly on revenues that take into account expected changes in trading patterns made in response.)

The biggest problem with addressing the tax-shelters and the currency-manipulation is that it involves dealing with things beyond U.S. jurisdiction and invites reciprocity. That, and it may be unworkable. How exactly would the U.S. collect fees it imposes on China? China is a sovereign country, and starting a fight over trade-practices with a country that holds so much of the U.S.'s debt may not be the best plan. The same problems arise with the tax-shelters: They are in other countries. Shitting them down amounts to limiting foreign investment by U.S. companies and invites undesirable trade-practices from others. It is very, very difficult to do without causing trouble. If Sanders really found a way to handle 5% of the U.S. deficit like this, I applaud him for it.

Taxing capital gains an dividends the same as work would actually lead to lower tax-rates overall, I think: The problem is that these sources of income are the primary ones for investors who own shares in corporations and get applied after corporate taxes. The rates are lower to account for the double taxation. Combined with corporate taxes, we are talking about roughly 50% federal ax-rates (50.535%). I know what Sanders means, but taxing capital gains like that is tricky business: The dollar drops with inflation, but much of the value of a company is in real wealth, so capital gains protect investments from inflation. How many pension-funds use this fact to protect themselves from inflation? Speaking of inflation, consider how long people live in houses before selling them when they move, and the fact that capital gains taxes apply to those too. An increased capital-gains tax-rate might work well if it is applied only to gains after inflation.

Eliminating the cap on axes that go to Social Security would severely damage it politically. Right now, Social Security is, at least officially, a retirement-plan to which people contribute with some equalization. If people are regularly told to contribute more than they could possibly use in retirement, then it will be seen as straight income-redistribution and many of its current moderate supporters may consider cutting it.

Cutting unnecessary spending by the Pentagon is popular with everyone outside the Pentagon, and even some in it. However, politicians cannot micromanage the military and maintain anything close to a functional armed force. Those in the Pentagon ultimately decide where their funding goes, and those bureaucrats are not giving up their pet-projects so fast.

I think I've written elsewhere on Care2 about the trouble with Medicare negotiating for lower prices for pharmaceuticals. I am actually in the middle of developing a tool to allow it to do this without severely damaging medical research (a dramatically more efficient engine for computer-simulations than is currently used for research in the U.S.) and I have some other mitigation-ideas, but without those fully implemented, this could effectively shut down at least half of the world's medical advances.

In short, Sander's ideas are a mixed bag, and most of the good ones are far more difficult to implement than they seem. I would normally want to see work go ahead on them so that people could try to fix the deficit, but with today's U.S. federal congress, I expect such work to lead to more harm than good.
 

. (0)
Sunday January 5, 2014, 1:21 pm
tell your govts to stop allowing companies to use offshore slave labour http://action.sumofus.org/a/haiti-hanes/?sub=taf
 
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