ii iv viii	Merry Christmas and Happy New Year NEW - In 2016 the 2-4-8 Tax Blend will become 2-4-8 Tax Choice The "choice" would allow all taxpayers to choose an income tax rate between 8% and 28% paired with a net wealth tax rate of 2% going down to zero. Wealth taxes paid would reduce Estate and Gift taxes (also set at 28%). This would encourage wealthy individuals to pay some net wealth taxes as a form of inexpensive life insurance.	Wealth 0% 0.5% 1% 1.5% 2%	Income 28% 23% 18% 13% 8%
		Business C - Corp	4% VAT 8% Income

Paul Craig Roberts, former Assistant Secretary of the US Treasury and Associate Editor of the Wall Street Journal, has held numerous university appointments and is Contributing Editor to Gerald Celente's Trends Journal. His columns are at www.paulcraigroberts.org.

... The problem with reading a book to learn economics that is taught in the universities and practiced in Washington is that economics is now a highly formalized subject based on abstract models and assumptions and has been mathematized. It is not that the subject is totally useless and without any applicability to real world problems. ... some of the tools and understanding provided are outdated and incorrect.

...  economists assume that man-made capital is a perfect substitute for nature's capital. This assumption implies that there are no finite environmental limits to infinite economic growth. ... Economists have almost universally confused jobs offshoring with free trade.

... My advice to readers who wish to develop economic comprehension is to begin with the outside-the-box economists who are addressing real issues. For example, Herman E. Daly and John B. Cobb...

... The Bubble and Beyond lets readers see how economic ideas developed in ways that leave economists unable to perceive the real character of the problems that are challenging them. Trapped in the matrix that they have constructed for themselves, economists are unable to devise solutions.

2-4-8 Response

Washington: Fix the Economy or Die Trying

I enjoyed hearing what I suspected about economists - that some “live in the artificial reality of [academics] or shill for corporations and Wall Street”. My own background with psychology and law reveals that these professionals, like economists, may be “trapped in the matrix that they have constructed for themselves, … unable to devise solutions”. When it comes to the hybrid specialty of tax reform it is near impossible to find an advocate that can think out-of-the-box and put aside professional and political prejudice. Washington’s lack of serious study of “all” tax reform options is unconscionable. Given the scope and magnitude of our economic malaise, this scholarship should be pushed with the effort of the 1939 Manhattan Project.

I expect my representatives in Washington to fix the economy or die trying.

Is it too much to expect congress to consider a value added tax to reduce the corporate tax rate (as is used by every developed country in the world)? A 4% VAT would permit the corporate tax rate to be reduced to 8% and eliminate any need for a territorial tax system.

Should congress at least consider replacing payroll taxes with a 2% net wealth tax (excluding $15, 000 cash and retirement funds)? This change alone would create millions of jobs and stabilize Social Security and Medicare for generations. It is tough medicine but it would fix the most important economic problems of our country. A wealth tax also provides a healthy negative reinforcement (“use it or lose it”) to encourage productive use of capital (rather than buying a second yacht, putting gold in a safe, opening a foreign bank account, etc.).

Lastly, does congress appreciate the fact that using net wealth and consumption to broaden the tax base permits reductions in the individual income tax rate to 8% and elimination of capital gains, estate and gift taxes? Together these changes encourage maximum business development.

Let us know at www.TaxNetWealth.com if you can identify a logical, legal or economic reason why this 2-4-8 Tax Blend would not produce a sustainable economic recovery as promised. Otherwise let your representatives in Washington know that the right blend of taxes can create jobs and restore wealth and a stable economy without government spending.

Eugene Patrick Devany, JD, MPA

 

 

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Copyright 1985 to 2015 by Eugene Patrick Devany