Now that the pandemic is starting to subside and states and municipalities are starting the process of reopening their economy and their societies it is time to start talking about ways that we can jump start the economy and put it on the path to recovery. These last couple of months have been a very trying time and very stressful for a lot of people, the least of which have been the small businesses in this country that make up about half of the job creators in our society. These small business owners are members of our communities, pillars of the society, and our neighbors. We need them to be successful and we need them to come back if we’re going to have any chance of recovering this economy. Here’s a few ideas I have that can help accomplish that goal and put us back on the path of economic solvency
Every state, every municipality, and Congress needs to create an economic regulatory review task force. The purpose of each one of these task forces needs to be to review every single regulation on the books at the local, the state, and the federal levels and determine if they are necessary to continue to implement. Regulations that are inherently designed to reduce the competition in a particular industry or make it harder and raise the cost of entry into an industry either needs to be eliminated or modified to ensure that the most number of people possible can compete in their chosen industry. Why does a plumber need a special license from the government giving them permission to root out Your pipes? Why does a barber need permission from the government to cut your hair? Why does a car salesman in Louisiana need permission from the government to sell you a car, and I’m not even talking about the car dealer, I’m talking about the actual sales person that you interact with?
Same thing needs to happen at the business level. If there’s a regulation or a license requirement for something that can effectively be handled, managed, and regulated with insurance requirements, why do we need to go further and require them to get a permission slip from the government? The overarching guiding question that the economic task forces need to ask themselves is the value of this regulation greater than the cost of this regulation? If the answer is no then the regulation needs to be done away with, even if it’s only temporarily to help jump start the economy.
There needs to be a massive restructuring of the tax code and the tax structure in this country even if it’s only temporary. First and foremost, there is no greater resource of credit in this country than the investment of individuals into the economy. What better way to encourage that investment in the small businesses and even the bigger businesses in this economy then cutting capital gains taxes in half? Cutting the capital gains tax in half would encourage Americans to invest in the stock market, or make investments in their businesses, or open up new businesses. The current capital gains tax structure is either 0%, for the least income earners in this country, 15 or 20%.how much more money would the American people be willing to invest in this economy if they knew they could keep more of the profits from their investments? Liquidity in the credit markets is the grease that moves the wheels of the American economy. Getting more private investment into the credit markets will help bring back this economy to prosperity and growth much faster than government investing in the credit markets. If governments invest in the credit markets, that is money that is borrowed from the American people and has to be paid back, money that the government doesn’t currently have, therefore supercharging inflation, lowering the value of the American dollar, and stifling growth in the economy.
The government should also consider slashing business income taxes in half as well as suspending corporate contributions to the social safety net programs of Social security, Medicare, and Medicaid, for a period of at least 2 years. This will make it cheaper for businesses of all sizes to hire new employees, or bring back laid off employees, therefore providing jobs and income to the consumers that will then go out and spend that money in the economy to grow the economy towards it’s once former strength.
States should also consider restructuring their license and fee structures to a more fixed cost structure, if not permanently at least temporarily. This will allow businesses to better plan for and better budget for their cost of doing business, therefore allowing them to better plan, manage, and grow their businesses in a more controlled environment while we are getting this economy back on its feet. states and local municipalities should also consider cutting their sales tax rates. If you can make the products and services that consumers buy cheaper by lowering the sales tax rate, you encourage more people to buy more products, which is ultimately going to be what revives this economy and makes it stronger once again.
We should also consider doing a massive personal income tax cut at both the state and federal levels.This will free up more income at the individual level to become disposable income that consumers will then turn around and go out into the marketplace and spend therefore driving economic activity which will grow the economy and strengthen it back to its pre Corona virus levels.
There are many more actions that the federal and state governments can do to get out of the way of the private sector to bring this economy roaring back to its former glory. These are just a few ideas that I’ve listed above. But one thing is for certain if we continue to stifle this economy and it’s growth with burdensome regulations and taxes that discourage competition, it’ll take longer and it will be more painful for this economy to come back and more people will suffer in the long run,making it more likely that my prediction that more people will die from the economic depression due to this pandemic then will actually die from the pandemic itself to come true.