I won’t even tease you with the fabulous new speakers that we are adding every week. The lineup just keeps getting better and better.
By the way, I was looking through the list of attendees. There are almost 100 people from outside the US already registered. I see a lot of familiar names, and we could easily put together a fascinating conference just from the attendees. We are evaluating two different computer apps that will, among other things, significantly enhance attendee networking.
One of the comments I have heard over the years is that people would like to be able to network more effectively with other attendees, but they do not always know whom they want to meet. Whichever app we choose, it is going to allow you to find and grow a network of people who share your interests. This is one time you really want to be in the room if at all possible. Now to our letter.
An Open Letter to the President, Part Five
Let’s summarize where we are. Last week I showed you where to find $2 trillion for infrastructure development by repurposing the Federal Reserve’s balance sheet. What I didn’t mention was that, while the whole trillion obviously cannot be put to work the first year (given the nature of infrastructure timelines), it is not unreasonable to expect that $400 billion in annual expenditures could be reached within three years. There are 122 million people working in the US today, in an economy of roughly $20 trillion. We could easily expect that our $400 billion a year to translate into more than two million jobs and perhaps even more, as infrastructure development is generally more labor-intensive than many other activities are. And these jobs would generally be higher paying than most service jobs, so this initiative could deliver a serious stim ulus for the economy, helping us steer clear of recession.
And if you do the authorizing legislation correctly, it could be the gift that keeps on giving. As these bonds are paid back to the Federal Reserve, the Fed could use the money coming in to fund even more infrastructure construction. Your presidential legacy might well include leaving the country’s infrastructure in its best shape in 100 years and continuing to improve. Not a bad day at the Oval Office.
Then I showed you how restructuring the corporate income tax – about which there is already quite a lot of bipartisan agreement – would offer a radical boost to US business, especially export businesses, and generate modestly more revenue by eliminating all deductions. Of course, a lot of K Street lobbyists would have to look for new jobs; but they are reasonably well educated, and I’m sure they could find something to do that would actually be more constructive .
The Need for More Revenue
But we come to a real sticking point as we begin to figure out how to navigate the budget. Taxing foreign-earned revenue and growing the economy will only modestly increase the revenue stream from taxes in the short term. To offset the trillion-dollar deficits that the economy will be racking up in just a few years, you’ll need more than modest revenue growth.
There are really only three ways to deal with the deficit. You can increase taxes, cut spending, or borrow money. You will notice that there is at least one party in Congress generally opposed to two out of those three. It’s an existential dilemma for Republicans to allow taxes to increase or for Democrats to cut spending, especially on entitlement programs. Yes, Republicans would be willing to cut some entitlements, and Democrats would be willing to cut some defense spending, but both parties are just tinkering around the edges and won’t get you to where you need to be.