The Effects of the Economy in my Neighborhood

Since tax day is rapidly approaching and how much you paid affects your own personal economy, I thought I'd discuss my observations of the effects of the economy in my own neighborhood. What does this have to do with tax day you ask? Well because the more taxes you paid last year, the less disposable income you had to save, pay off debt, or spend, which affects your own personal economy. And if you didn't pay any taxes, perhaps your family didn't earn enough to pay which may be abnormal for your family, which may have made your own personal economy very very tight.

So every holiday around my neighborhood you can walk through or drive through the various streets and see all kinds of decorations out in the yard. Easter is no exception. The one that floored me was the year I saw Valentines decorations out at one or two houses. Not everyone decorates their yard, but a few handfuls do including some of our neighbors surrounding us. Yesterday in really hit me that no one has decorated for Easter. Usually a few people have some kind of blow up monstrous easter bunny out in their yard with who knows what else.

You may be thinking what I was thinking at first, they just didn't put out their decorations from last year. Maybe they got lazy. My father was quick to point out that most of these people don't store their decorations, they have garage sales all spring and summer to get rid of all their crap so they can buy new crap for the next holiday. You might be able to conclude from that statement that our household doesn't waste money to put crap outside in the yard for every holiday. But those that do are more than welcome to. I just hope they aren't going into debt for it or already drowning in debt.

That may not seem like much, and to be honest Texas is one of the better places to be during this economic slowdown. But there are random foreclosures around here and there are people getting layed off. But Dell is always laying people off so you know you will get it if you don't leave first. There are jobs to be had here and it's not nearly the painful blow that some states are experiencing. Nonetheless, you do see people pinching their pennies and restraining their spending. Which most probably should have been doing all along.

So how do you see the economy affecting your neighborhood, office, or city? Do you think tax policies increasing taxes on income or goods and services that you consume will help your personal economic situation? Will that help you and your neighbors pay their mortgage, pay off their credit cards, or perhaps buy their next meal? Will it help employers add a job that perhaps you or your neighbor would love to have? Remember tax day isn't about refunds, it's about all the hard earned money that the government takes from hard working people to spend as they see fit. I'm not saying all functions of the government are bad. But how much is too much? What percentage did you end up paying? Are you ok with it? Are you ok with your employer's taxes going up? What if that means he has to let one person go as a result? Are you ok if that person is you?

There are alternatives to current tax policy, but that includes taking power away from the government and putting it back in the hands of the people. How do you feel about that? Would you just prefer the government take care of all your wants and the loss of your power and money? or would you prefer they not have as much power and you have more money?

Of course I support the Fair Tax at this point. But their are other solutions out there that I would be ok with. You can't just whine and complain about tax policy. You have to have a plan you can support. Then you have to nag your representatives and let them know what you support and what you want them to support. Let them know current policies are unacceptable to you and commit to voting them out of office if they support them.

My Tax Plan

My tax plan is simple. Many of you may have heard about it by now, and one Republican candidate actually ran with it as a plan he would push for. He was the only candidate on either side offering something legitimately different than the status quo i.e. "tax cuts" or "raising taxes on the wealthy." It is the Fair Tax. I will do my best to summarize here but you can read up on it in more detail at http://www.fairtax.org/. There are a few changes I would like to make to it, but it's a good starting foundation for now.

Basically speaking, it eliminates the income and payroll taxes and replaces them with a national sales tax. There are states now, like Texas and Florida, that utilize this general philosophy on the state level to collect and manage their general revenue. They don't collect income taxes in addition to property and sales tax. What this means at the national level is that you only pay taxes when you consume. You get to keep 100% of your paycheck!! It also means that people that don't pay income taxes now would pay taxes when they consume in our country. This includes illegal aliens, tourists, anyone paid in cash now that doesn't file income taxes.

This is a solution that is beneficial to everyone as it takes care of social security, Medicare, Medicaid, and other popular welfare programs that everyone doesn't want to see go away, but no one wants them to bankrupt the country either. The Fair Tax solves this problem since it increases the pool of people paying taxes.

There is one other benefit to the Fair Tax so that basics needs are met by all. All families will receive a prebate each month based on the number of people in your house hold for the amount of tax for the basic necessities of the household regardless of income. Anyone who can't afford more than the basic necessities will in essence pay no taxes unless they consume above and beyond your basic needs. Sorry Christmas presents don't count as basic needs, but with more spending power created from not paying taxes on your needs, Christmas presents might not be so difficult to swing each year.

Oh and there's a bonus, it eliminates the need for IRS (not the need to keep collecting on back owed taxes). But April 15 will no longer be the dreaded tax day, it will be just another day. And before you worry about all those government employees out of work, think of all the jobs that are now shipped overseas to countries considered more of a tax haven than the U.S. is now. With no income and payroll taxes, companies will be bring operations back here and/or move operations over here. So there will be plenty of jobs for them to get, as well as for all the other people who are unemployed.

While free market competiton takes care of the price of goods, one other thing I should mention is that only new goods are taxed. If you buy a used home or a used car, no taxes. If you buy used clothes, furniture, or anything else not new, no federal sales tax. You may still be subject to state taxes, but who cares if you understand this concept, you can make decisions based on this knowledge of when and how much you'll be taxed.

Again for more detailed information, check out http://www.fairtax.org/. It's a valuable source of information. There is also a link on there that tells you which of your Senators and Representatives support it or not. http://www.fairtax.org/cgi-bin/scorecard.cgi
Once you make up your mind that it's a good thing for our country, write your Senators and Representatives and let them know your thoughts on it even if they support it, but especially if they don't. The more voices they hear on this subject, the more they are likely to take a closer look at it. This isn't a partisan solution in my opinion, it's a win win solution for everyone, except for purist who are opposed to all taxation. It's better than a flat tax as it taxes consumption. So all those rich people buying cars and mansions and clothes and whatever else they buy will now be taxed on their consumption, not their earnings or capital gains as much of it sits in. You basically get to choose when you want to pay taxes or not based on the consumption decisions you make.

Meet My Vice President

This is Riley. My Vice Presidential running mate. She's tough on security and won't hesitate to take down anyone posing a threat to America. She agrees with me that there is too much wasteful spending in the government and as president of the senate, she would vote against any bills filled with wasteful spending should her vote be needed. She will also use her voice of reason to discourage elected senators from passing bills that will waste the tax dollars of those that elected them.

She's a strong proponent of personal responsibility and will do everything she can to promote the personal responsibility of each and every American, and work to inhibit government interference in their attempts to take personal responsibility for themselves.

Together we want to help teach every American to take pride in setting their priorities straight to rely on themselves rather than the government. One way we plan to do that is to privatize social security. The government will no longer take ownership of your social security. You will own that money and it will go into an account for you to invest. It will still come out of your check every time you get paid, but you get to direct the investment of it, and if you die before you retire, the total balance belongs to you to pass on to your family. Once you reach the age of 50 or the balance is $300,000, whichever comes first, you can have access to it. You can also contribute more of your income to it each pay period if you wish. But the point is you can decide how much risk you want to take or not and you will own your money, not the government.

Another plan we have is to reduce the corporate tax rate to 10%. The United States currently has one of the highest corporate tax rates in the world. That's not what this country is about. We want America to have one of the lowest corporate tax rates in the world to encourage American companies that have sent operations overseas, to bring them back to the U.S. which will provide more jobs to Americans that want to work. This will also encourage other countries to come and do business within our borders. This helps you as a consumer because corporations pass the cost of those taxes on to you the consumers. The lower the cost, the less you have to pay for goods and services as long as you the consumers are prudent and the free market is allowed to operate freely to compete against each other.

We'd also like to replace the income tax, that hard working families pay,with a national sales tax. This is currently known as the fair tax. We propose a few modifications to the Fair Tax to impede government growth and takeover in your daily lives and to encourage personal responsibility rather than discourage it. All you need to know now is that you pay taxes when you choose to consume. Each family will receive a prebate every month based on family size to cover the taxes on necessities like food and clothing. Those who consume the most, pay the most taxes. It also means we will now be collecting taxes on tourists, illegal immigrants, organized criminals, and anyone else not currently carrying their fair share in the tax burden. Feel free to read up on the fair tax and ask me specific questions on what I'd do differently.

Finally, we'd like to eliminate the ridiculous death tax. It's government robbery to take money that has already had taxes paid on it once. We'd like to end that horrid practice.

These are just a few of our proposed economic changes to help stimulate the economy by increasing jobs, increasing the purchasing power of you, and giving back social security ownership to the people.