I want to talk about things in-order-of-importance to turning our country around. Making that choice is not a perfect science. Our financial stability is crucial, it is paramount to create more jobs — and this hinges on tax reform — yet the existential threat from Iran could be considered most crucial by some. So forgive me that I had to make a choice where to start — and I have chosen the broad category of “needed amendments to our constitution.” In dealing with this broad of an issue, we will initially leave out the small issues/details.
The 4 New Amendments
* Term Limits Amendment — a lack of Congressional term limits is perhaps the greatest cause of corruption and over-spending. We were never meant to have permanent politicians. Our founding fathers made that clear. If they had known over 230 years ago how massive our debt would be due to our congress “spending to buy votes,” they would have written term limits into the constitution. While there is something to be said for the value of “experience” in our politicians, we need to settle for private sector experience. We simply can’t afford getting “spending experience” via re-election. It is imperative that we eliminate “buying votes” as a means to getting re-elected. Congressmen/women (that is the last time we will worry about being politically correct with gender) must not be allowed to spend/borrow more money in order to get people to vote for them — and continue the cycle. I am convinced that our current massive debt (over $18 trillion in just current federal government overspending; not including unfunded future liabilities from Medicare and social security for those who already contributed into those systems; not including state or municipal debt; not including personal/credit card/mortgage/student loan debt; not including business debt) would not exist if we had term limits. This could be the single most effective component in returning to fiscal responsibility. What should those term limits be? I am not married to any numbers. A common limit described is 12 years maximum in combination of house and senate. Thus, those people would need to have a “real job” before and/or after their congressional job.
* Balanced Budget Amendment-— self-explanatory. Our DEBT is killing us. This amendment would include a clause that until our current debt is paid off, at least 1% of the balanced budget goes toward paying off the principle on the debt. [Thus the budget would balance after including a 1% paydown in current debt]. ALL surplus tax collections must immediately go toward debt reduction.
* The Fair Tax — Eliminating the IRS — Amendment. This will result in a financial boon! While The Fair Tax can be created by congress, we need a simultaneous constitutional amendment to eliminate the IRS, so that we do not end up tempting congressional spenders with two tax systems. What is The Fair Tax? It would take a while to do a description justice, despite its simplicity. You can check it out at FairTax.org or at FairTaxPlan.org. These are basic components and effects:
- Replacement of our current FEDERAL income tax with a national sales tax
- This eliminates all current FEDERAL payroll taxes as well … such that your Medicare and social security taxes would be paid through the sales tax
- This eliminates the time/expenses wasted in filing your taxes; it eliminates the expenses of the IRS and the intimidation by the IRS; all taxes would be collected by the states, just as they currently collect sales taxes; the only added expense is electronically submitting the tax to the federal government
- This essentially eliminates the tax cheating as well as the tax avoidance by drug dealers and prostitutes, for example; this lowers YOUR component when everyone else is paying their fair share
- This eliminates all business taxes, as there is only tax paid at the final sale; it therefore lowers the pre-tax price of all things by eliminating all of the used-to-be taxes at each step of creating the final product [it is calculated that initially the sales tax would be 23% — compare this to a tax bracket of 15% PLUS a payroll tax of 7.65%; it is estimated that product prices will be reduced by 20% due to eliminating business pre-sales taxes
- By eliminating business taxes, our businesses immediately become more competitive in world markets — creating a massive amount of new jobs; this component is the part that saves our country; and with more jobs, more people buy things, and our tax rate can eventually decrease (if we control federal spending with term limits and a balance budget amendment).
- the “pre-bate” needs to be described; rich people buy more boats than poor people, so the rich continue to pay the vast majority of taxes; however, due to concern for the very poor needing to be taxed on the purchase of basic needs, everyone in America is mailed a check each month (a “pre-bate”) to cover the sales tax on their first “X-amount” of expenditures (that X-amount represents the poverty level income, and will therefore change over time and with inflation; currently $23,800 for a family of 4).
The net effect is that all people pay into the tax, except those living below the poverty level. Everyone “has skin in the game.” While the rich still pay much more due to being able to afford to buy more … we will all be armed with the ability to lower our taxes by choice — choosing to save rather than spend. Your “financial success” is not taxed … your spending is taxed. To reiterate the best component: How does The Fair Tax make our country great again?The Fair tax will save our country almost overnight by eliminating corporate income taxes (even under our current system “corporations do not pay taxes — consumers pay those taxes”), thus making us immediately competitive with foreign countries and resulting in the greatest massive job creation in history.
* “No New Taxes” Amendment — A constitutional amendment stating that any/all increased taxes/fees or any new taxes/fees require a 60% majority in both houses of congress. This will put needed shackles on the big spenders. Unless they have a 60% majority, congress will have to eliminate something if they want to spend on something else. We all know that there is much pork to be cut.
We will stop here. Feel free to make comments. Our next blog, to complete the topic of law, will be regarding needed legislation (non-constitutional amendments) to return America to greatness!
– NATHANIEL ADAMS MARTIN, M.D.