On January 31, 2013, Lisa Mascaro writes in the Los Angeles Times that Congress has agreed to raise the debt ceiling, but the parties are still far apart on how to avoid across-the-board spending cuts due to start in March.
With agreement to lift the nation’s debt ceiling secured, Congress now turns to the next budget showdown: the deep automatic spending cuts due to start hitting the economy in March, which lawmakers appear unwilling — or unable — to stop.
The Senate sent legislation to temporarily suspend the $16.4-trillion debt limit to the White House on Thursday forPresident Obama‘s signature. The vote was 64 to 34, with mostly Republicans and one Democrat opposed.
Now, Congress must decide whether to stop the $1.2 trillion in spending cuts that are scheduled to begin March 1. Those reductions were once considered so severe they would force lawmakers to the table to negotiate a more balanced deficit reduction compromise.
With a month to go, both sides admit there is little hope they can reach agreement.
The cuts, called a sequester in Washington parlance, would slice equally across defense and domestic programs, drawing government spending out of the already sluggish economy.
Going down the path of austerity will certainly crash the economy. We need aggressive economic growth while simultaneously broadening private, individual ownership of FUTURE productive capital formation, enabling EVERY American to acquire via self-payment loans a viable income-producing capital estate over time.
Democrats and Republicans need to represent the well-being of ALL Americans with a priority on strengthening the economy and significantly generating income for ALL Americans.
Most Americans are not earning enough income to properly support themselves and their families. The country is experiencing a widening divide between an elite income class with well-paid salaries and dividend and capital gain income from stock ownership and low-pay wage earners and those dependent on taxpayer-supported government welfare funded by extracting taxes and incurring national debt. This situation will continue to worsen. Americans need to WAKE UP and realize that the FUTURE is one of technological unemployment. Private sector job creation in numbers that match the pool of people willing and able to work is constantly being eroded by physical productive capital’s ever increasing role. And as a result, most American incomes will decline, which will result in a downturn in the economy as there will be fewer and fewer “customers with money” to purchase the products and services society needs and wants. The result: no or significantly reduced opportunity for income.
This new reality is the result of technological innovation and invention, tectonic shifts in the technologies of production, and an obsolete union movement stuck in job creation and “more pay for less work” instead of bargaining for employee ownership and increased incomes resulting from dividends earned as stock owners in corporate America.
There is a solution, which will result in double-digit economic growth. The Just Third Way Master Plan for America’s future is published athttp://foreconomicjustice.org/?p=5797.
The solution to broadening private, individual ownership of America’s future capital wealth requires that the Federal Reserve stop monetizing unproductive debt, including bailouts of banks “too big to fail” and Wall Street derivatives speculators, and begin creating an asset-backed currency that could enable every man, woman and child to establish a Capital Homestead Account or “CHA” (a super-IRA or asset tax-shelter for citizens) at their local bank to acquire a growing dividend-bearing stock portfolio to supplement their incomes from work and all other sources of income. As well national debt needs to be focused on growing the private sector of the economy simultaneously with facilitating private, individual ownership of FUTURE productive capital formation. Policies need to insert American citizens into the low or no-interest investment money loop to enable non- and undercapitalized Americans, including the working class and poor, to build wealth and become “customers with money.” The proposed Capital Homestead Act would produce this result.
The fundamental economic solution is to create income for EVERY American by simultaneously broadening private, individual ownership of FUTURE productive capital economic growth and fully paying the profit dividends to the new American owners of the income-producing capital assets of our corporations.
Support the Capital Homestead Act athttp://www.cesj.org/homestead/index.htm andhttp://www.cesj.org/homestead/summary-cha.htm
Under the Just Third Way more just and simple tax system, the following is proposed:
• Eliminate all tax loopholes and subsidies,
• Provide an exemption of $100,000 for a family of four to meet their ordinary living needs,
• Encourage corporations to pay out all their profits as taxable personal incomes to avoid paying corporate income taxes and to finance their growth by issuing new full dividend payout shares for broad-based citizen ownership,
• Eliminate the payroll tax on workers and their employers, but
• Pay out of general revenues for all promises for Social Security, Medicare, Medicare, government pensions, health, education, rent and subsistence vouchers for the poor until their new jobs and ownership accumulations provide new incomes to substitute for the taxpayer dollars to fill these needs.
• The tax rate would be a single rate for all incomes from all sources above the personal exemption levels so that the budget could be balanced automatically and even allow the government to pay off the growing unsustainable long-term debt, but the poor would pay the first dollar over their exemption levels as the hedge fund operator and others now earning billions of dollars from capital gains, dividends, rents and other property incomes which under some tax proposals would be exempted from any taxes.
• As a substitute for inheritance and gift taxes, a transfer tax would be imposed on the recipients whose holdings exceeded $1 million, thus encouraging the super-rich to spread out their monopoly-sized estates to all members of their family, friends, servants and workers who helped create their fortunes, teachers, health workers, police, other public servants, military veterans, artists, the poor and the disabled.
• The Federal Reserve would stop monetizing unproductive debt, including bailouts of banks “too big to fail” and Wall Street derivatives speculators, and
• Begin creating an asset-backed currency that could enable every man, woman and child to establish a Capital Homestead Account or “CHA” (a super-IRA or asset tax-shelter for citizens) at their local bank to acquire a growing dividend-bearing stock portfolio to supplement their incomes from work and all other sources of income.
• The CHA would process an equal allocation of productive credit to every citizen exclusively for purchasing full-dividend payout shares in companies needing funds for growing the economy and private sector jobs for local, national and global markets,
• The shares would be purchased on credit wholly backed by projected “future savings” in the form of new productive capital assets as well as the future marketable goods and services produced by the newly added technology, renewable energy systems, plant, rentable space and infrastructure added to the economy.
• Risk of default on each stock acquisition loan would be covered by private sector capital credit risk insurance and reinsurance, but
• Would not require citizens to reduce their funds for consumption to purchase shares.
http://www.latimes.com/news/nationworld/nation/la-na-debt-sequester-20130201,0,1516666.story
