Simple Tax Plan

America is in Financial trouble for the same reason that anyone gets in trouble. We don’t take in as much as we spend. There isn’t anyone who disagrees with this.

Republicans say that the answer is to run the government like a business, but no business prospers or even survives by taking in the least money for the fewest possible services. It’s a business plan that has no chance of success, and the Republicans prove that every time we allow them into power.

The Democrats at least try to create services that are popular because that’s how they get into office, but the Democrats aren’t very good at coming up with a plan to make those services affordable. Perhaps the most accurate criticism that the GOP makes is that the Democrats aren’t even thinking about the government like a business.

The Government As a Business

When you start a business, you really need to know what is going to make people want to give you money. You can do all kinds of cool things, but until you have fostered the voluntary transfer of cash from customers to you, it’s a project rather than a business. Our government is still a project.

Political Stability

What have we got to sell? How about political stability? If you don’t think that’s a reason to do business in the US, try running your Subway shop in Uganda. What’s it worth to you as a business owner? More importantly, as the provider of this very valuable service, what will the marker bear? We don’t want to cripple business in any way, but we need to remember that they are the customers for the government of the people. They are not the people.

Every business should be very happy to pay 33% of their profits for political stability alone. If you are not making a profit, we’ll carry you until you do because new business is the lifeblood of capitalism while old businesses are frequently hardening arties. A robust economy is an economy with lots of new businesses. Big business is brittle.

This is the Political Stability tax. It’s not much different than the current corporate income tax, but it answers the main complaint of those idiots who say they don’t get anything for their taxes. This what you get. This is what costs you. We’ll negotiate because that’s the way business works, but negotiation means you need to sweeten the deal for us in some way for us to even consider some alteration. Otherwise, you can take you business to Uganda if you don’t think this is a good business opportunity. We only want happy customers, but we’re not going to ruin our business model by making every customer happy.

Infrastructure Taxes

Infrastructure is the difference between a First World country and a Third World country. It always has been. It always will be. Our infrastructure is still one of the best reasons to locate a business here instead of somewhere else. Businesses should pay direct usage fees (pre-tax income) for use of infrastructure, and a five percent infrastructure expansion tax out of their profits. We can only win in the world to come by having the best possible infrastructure.

We’ve been one of the rich countries in the world because we have always invested in infrastructure. Look at the infrastructure we’ve created. Note that the government was the driving force in all cases. Railroads, highways, the electric grid the Internet are all critical pieces of our infrastructure that only work because of the government’s direct participation. Just 75 years ago, most of the United States used outhouses and had no electricity. Infrastructure is civilization.

Our education system, schools, libraries, public water and sewage, and our health care system are all part of the vast and wonderful infrastructure that we provide. Companies will only keep starting here if we continue to be the best place to start them by providing the best infrastructure.

Again, this structure provides a bit of corporate welfare for new and struggling businesses by not charging an infrastructure tax until a business makes a profit.

Monopoly Taxes

Everybody talks about too big to fail when it is obvious that these morons are going to take the whole world down with them when they go, but once the crisis has passed, too big to fail becomes too big to screw with. This has to change or we will inevitably collapse.

‘Big’ is the key word in too big to fail. You avoid too big to fail by keeping companies from getting too big. The problem here is not the steepness of the intellectual challenge. The problem is having the guts to face up to the monster companies who have their tentacles in every aspect of our lives.

I propose a sliding scale monopoly tax where you pay more tax based on our market share. Is that fair? It’s our market. They can sell their widgets elsewhere if they don’t like this deal. I don’t think we’ll lack for customers who want a piece of the action.

Again, the monopoly tax will only be charged on profits. If a company is a monopoly and not making a profit, we’ve got a problem tha cannot be solved by tax policy.

How much is the monopoly tax? A profitable company is paying 38% of its profits for political stability and infrastructure. If we charge them a one percent monopoly tax for each two percent of the market they control, they will be able to keep twelve percent of their profits.

Is this a capitalist disincentive? Of course. That’s the whole point. We want to structure the tax code so that companies try to stay small and nimble so they don’t become a danger to the overall economy.

Individual Taxes

No individual taxes on the first million each year, and 38% on the remainder. After you make the first million, you are as dependent as a business on the government to protect your wealth. Furthermore, it is likely that your large income is due at least in part to our fabulous infrastructure. Please send us the money with a thank you recognizing that we the people made all of this possible.

There will be investment incentives, but only for those who invest in small business. Anyone who invests in a true startup can exclude up to five times the amount of their initial investment if the project explodes in value. Capitalism is gambling so we need to encourage people to gamble.

Is it fair to charge higher taxes to the rich? Of course! No one’s coming to steal what we’ve got. If they are coming at all, they’re coming for the rich. They’ll probably want our help when this happens.

Summary

Individuals who make less than a million and business that don’t make a profit will pay absolutely no taxes.

We will do everything possible to make businesses successful because successful businesses will pay our bills, but we don’t want businesses to get so big that they become a threat to the system.

All successful business pay a flat 38% on profits. Any exceptions to this must have a one-year sunset clause.

Companies owning more than two percent of their designated market will pay the monopoly tax.

This plan should generate all of the tax revenue that America needs to get out of debt while removing the crippling burden that our current tax structure places on our economy. Inside of five years, this will pay off the national debt without having to sacrifice any investment in infrastructure. Beyond that, we will have the money we will need to deal with the certainly bigger problems of the future. Trouble is coming because it always does. Let’s be ready.

More opinions based on a lifetime of citizenship, whatever that means, can be found at my Twitter column at http://www.twitter.com/alanbcorwin