Tornado Alley (PROG)

[wbmw]

What we need is a game changer for all citizens and small business NOW! and the FICA Tax Holiday would do it. And it would be 100% for small business and average citizens. FICA drops off at what 106k so the "rich" would benefit proportionally much less than average Joe and Jane and Bill Small Business.

Let's spawn this one out in a separate discussion, since it's interesting.

Based on the 2011 budget, there are $934B in revenues expected from Social Security and retirement taxes - so that would be roughly the cost of the bill, and the addition to our deficit, in order to enable this tax holiday.

http://www.whitehouse.gov/omb/budget/fy2011/assets/tables.pdf

Meanwhile, we should compare how that would be different than the $787 billion stimulus bill passed last year, which is also money that was injected into the economy, except that it was specified to fund projections such as infrastructure and research grants that not only contributed to the economy and created jobs, but also funded projects that the country needed.

How much of the $934B in tax cuts that you are proposing will do the same thing, compared to how much people will just leave in their bank account, which is not stimulative at all, and merely contributes to inflation?

I'm not trying to be negative on your idea, but you claim that some people will use the money to create jobs, and some people will use the money to get out of debt. Well, that's all great, but the $934B price tag on your proposed tax cut is more expensive than the stimulus bill, and so I'm trying to hold it in contrast to it, to see if your idea would have actually been superior.

And by the way, I'm sure you're familiar that 1/3 of the stimulus bill went towards state aid that - if not implemented - would have resulted in budget shortfalls in many states, that would have had to result in budget cuts, leading to reductions in employment in positions like teachers, police officers, and other government jobs. Your $934B tax cut would not have saved any of those jobs.

Lastly, I'll just point out that another 1/3 of the stimulus bill was in fact a tax cut for most middle and lower-middle class Americans. Of course, Obama hardly got much credit for it, probably because it only showed up as $40 of additional money in a person's monthly paycheck (which was $140B worth of lost revenues) - but it was in fact a tax cut to stimulate the economy in a time of need, that the taxpayer is eventually going to be responsible for paying back.

So again, if we increased that tax cut to $943B, how would it stack up against the $787B bill that was passed last year? In all fairness, if you think it's such a good idea, then you ought to be able to stack it up against the stimulus bill and explain how it would have been better.