We have all been there, or at least some version of it. That time when we are forced to make the really tough choices. During this recession many families and businesses have been faced with many tough decisions.
- How many people do we lay off?
- What can we sell?
- Can we really live without cable TV?
- No pay increases, again?
- Hot dogs and hamburgers instead of steak and ribs?
- Can we raise our prices, again?
South Dakota went through this earlier this year. There was some very tough and unpopular decisions made in Pierre. Now our federal government is at that place now. There is an August 2nd deadline looming that something, has to be done or the United States of America starts defaulting on it’s loans. (BTW that would be bad)
At the heart of the problem, is quite simple. There is more going out, then what is being taken in. Even my thirteen year old daughter knows the answer, cut expenses and increase income.
The government has one means of income, taxes. Is it a simple means of raising taxes (or like from the gang of six plan) closing tax loopholes?
From Joseph Mason ?Don’t Balance the Budget On the Energy Industry?
Economists have understood for decades that the relationship between tax levels and government revenue is a backward-bending curve, not a straight line. After a certain tax rate threshold, higher taxes have a negative effect on production.
In layman’s terms, tax people too much, and they no longer have the inventive to work. In a perverse feedback loop, decreased production lowers the tax base and federal revenues so that increased taxes result in lower federal revenues.
Instead of raising taxes, they need to be lowered? Instead of adding more regulation, we need to get rid of rules that get in the way?
Our own Representative Kristi Noem put out in a press release a few weeks ago:
As a former small business owner myself, I understand the difficulties in maintaining a business let alone expanding one. That?s why Washington must abandon the path of more heavy-handed government regulations, misguided, wasteful spending and higher taxes. Instead, we need to focus on the needs of small business owners because they create the lion?s share of new jobs both in South Dakota and nationally.
Before a small business makes the decision to hire another employee they need to see several things in the economic climate going forward. First and foremost, job creators need to know that the tax and regulatory environment won?t change for the worse. The looming threat of a tax hike or burdensome new regulation might be enough to stop a small business owner from hiring that new employee. Additionally, small business employers need to know that the government is working to implement policies that are growth-oriented. That means we should focus on enacting trade agreements to open markets and level the playing field with overseas competitors. It also means we should be implementing policies that encourage American-made energy to keep the cost of gasoline and other fuels down.
Do what you have to do to fix the short term problem, then go after the root of the problem
The solution to this problem is simple:
- Cut Taxes.
- Repeal or remove anti-business regulations (Obamacare)
- Take a ‘all of the above’ approach to energy independence
- Drill, baby, drill
- Wind/solar/hydro energy
- Research other fuels
- Get rid of programs and agencies that don’t work and causing problems.
Businesses want to grow, and hire more people. Most Americans want to work, and earn a decent living for their families. Right now what is standing the way is the government and their taxes and regulations.
Ronald Regan said it best:
In this present crisis, government is not the solution to our problem; government is the problem.