So I just started this blog and I was thinking, how best to kick it off? Well, I know! How about I tell you all how the USA can pay down its 21 trillion dollar debt? I hate to say it, but it's so damn easy. And no, it does not require cuts to any social programs. Not a penny. So how do we do it?
Well, let's see. The U.S. annual deficit tends to be somewhere in the hundreds of billions. I've seen numbers as low as 400 billion and as high as over 900 billion. This means that if Uncle Sam brought in an extra trillion dollars, we would go from deficit to surplus and could then pay down the debt.
Well, let's look at tax loopholes. No, I don't mean tax deductions that are meant to benefit everyday Americans. I mean rules in the tax code that can only benefit the rich. They cost the US, wait for it.......trillions of dollars! I'll provide some sources below, but here are just three of the biggest examples:
- Hiding Money Overseas: When you hear Bernie Sanders talk about companies who "stash their money in the Cayman Islands and don't pay a nickel in income tax," he's not lying. Big corporations save a lot of dough by hiding their profits in offshore bank accounts. Sometimes, they'll set up a subsidiary in a place with little or no corporate taxes and insist to the IRS that they really are from that place. I remember being in Ireland and seeing a Twitter office there, and my tour guide hinted to me what that was all about. This is nothing more than legalized money laundering, and this loophole alone costs the federal government trillions of dollars.
- The Carried Interest Loophole: Money earned from investments, known as capital gains, is taxed at a much lower rate than normal income. Some say that this policy is good for the economy as it encourages investment, others do not agree. However, the carried interest loophole simply goes too far. Currently, when you invest in a hedge fund or other private equity fund, you normally put in a sum of money to be invested, and you take a share of the investment profits while the investment fund manager takes a cut. The manager's cut is known as carried interest, and it is taxed at the lower capital gains rate. In other words, the manager takes a fixed cut of the profits, even if it vastly exceeds the amount of money that he or she invested in the fund, and all of it is considered capital gains. Doesn't matter how much you personally invested, if you're the manager, you get to claim a cut of everybody's contributions and call all of it capital gains. This means that hedge fund managers often get to declare virtually all of their income as capital gains, and pay a lower rate on it. Warren Buffett, Mitt Romney, and others have all brought attention to this loophole by how they have benefited from it. It has become one of the most popular loopholes for bashing, and even Donald Trump has spoken out against it and promised to close it in his big tax bill. Alas, however, the loophole remains popular among all the fat cat investors in Washington, and so it remains.
- Tax Deductions On All Homes: As most people know, you can get a tax deduction when you buy a home. This seems fair. We want to help people afford to buy homes, especially as they only get more and more expensive. However, did you know that you can get a tax deduction on a second home? A vacation home? Sometimes, you can even get a tax break on a yacht. This, to me, is one of the most embarrassing of all the tax loopholes.
And there's plenty more!
So let's say that we close all of these loopholes. That should get us from deficit to surplus, no problem. Add on by cutting our massive, bloated military budget, and Uncle Sam should be loaded.
Everyone, please write to your elected officials and ask them to make these changes. Hell, show them this blog post! Not just to help this blog get famous, (though that would be nice), but to show them the truth. Let them show the country the truth. I dare any member of congress to stand on the floor and tell us why these tax loopholes make sense. And spare me the argument of, "we just need to lower taxes, and then people would no longer use these loopholes." Yeah, right. If we lowered the corporate tax rate, and there are still offshore tax havens where there is none, do you really think companies won't still store there money where they won't have to pay a penny? Of course they will. And the fact is, we shouldn't have to give the rich more in order to crack down on legalized cheating. We can debate tax rates all day long. But loopholes are indefensible.
So write to your officials, and share this post around on social media as well! If there's one piece of mine that I'd love to viral, it's this one.
Who says liberals don't care about the national debt?
-Jack
Sources:
https://americansfortaxfairness.org/tax-fairness-briefing-booklet/fact-sheet-offshore-corporate-tax-loopholes/
https://www.bankrate.com/finance/taxes/tax-loopholes-mainly-benefit-rich-1.aspx
https://www.accounting-degree.org/accounting-tricks/
No comments:
Post a Comment