Washington needs to stop viewing the tax code as simply a way to raise money, and instead use taxes to create jobs and prosperity. The U.S. tax code needs to be designed in a way that spurs American investment and job creation, not prevent it as it currently does. What we're talking about here is the simplest kind of economics: if you lower taxes on something, you will always see more of it come into being. The principle also works in reverse, and here's a great example: the cigarette tax. Back in 2008, New York raised its cigarette tax by more than a dollar to $2.75. The result: consumption fell and the state's smoking rate dropped by 12%.
If rewriting the tax code can reduce smoking by 12%, then by altering the tax code in other areas we can also make investing in America grow by 12, 15, even 20%! Raise taxes on companies that build and invest overseas and cut taxes on those that build and invest here. That would add jobs by the millions! We can reverse this flow of money out of the country by using the tax code to make investing in our own country more profitable. It would certainly be much more profitable for all of us than continuing to send that investment cash and those jobs overseas, or using that cash for nothing more than financial speculation.
Of course, another issue with the tax code is corporate loopholes. Every year you and I send a check to Washington to pay our taxes, while large corporations, like GE, don't pay a dime! No need to demonize big business, however -- they're simply taking advantage of tax loopholes set up by their friends in Congress. And it's all legal! But we need to close those loopholes and somehow stop the practice of large corporations using money and power to gain favorable tax treatment.
3. Ending Rigged Banking Would Also Mean Many More Jobs
Our banking system right now is like a leaf blower in that it can either inject capital and spread it around through lending, which when done right creates jobs -- or it can suck way too much money out of the larger economic system in which it operates. And right now we're stuck in that reverse position where, with all that vacuum sucking, banks are taking potential investment money out of play. (With the trillion dollar bailouts we gave away the farm and in return got virtually no changes in the way banks do business!)
President Bush then passed the problem on to Barack Obama, and like a good Republican, Obama obligingly doubled down on the Bush plan, leaving banking and Wall Street to go on, still largely unregulated, as if nothing of any consequence had just happened. The President, Treasury Secretary Geithner and Fed Reserve Chairman Bernanke threw ever more of our cash at the big banks to keep them afloat in spite of all the toxic waste they had accidently accumulated in the form of worthless CDOs that were based on liar's loans and underwater mortgages. Problem was, the trillions then thrown at the banks by the Fed was created out of thin air and will sooner or later cause rampant inflation across the US.
Throwing trillions at the big banks is like pouring water into a bucket with a hole in it. How so? Because current banking laws, and for that matter trade laws, both make it more profitable for banks to:
(a) engage in financial speculation, loan the money right back to our own government, or invest it overseas . . rather than to . .
(b) focus on domestic lending.
In other words, before the money ever gets to domestic lending, it leaks out the hole in the bucket and ends up either overseas or in the gambling casinos of Wall Street (i.e. the markets for stocks and derivatives).