The key of Eisenhower Economics is the psychology of choice and targeted deductions.
What we have today is VooDoo economics or rather, post Reagan income tax rates that Trump is still lowering and thereby steadily increasing the national debt.
Today, through the infamy of fiat currency we spend all of our income tax revenue on the Military (MIC) and Defense contractors and then the government has to borrow money just so cover its operational costs.
This part of my blog entry is dedicated to President Eisenhower and his wisdom to warn us of the dangers of the Military Industrial Complex.
With that said, a system that taxes income must also require a scary high tax rate. Key word, “Scary” (If you’re not a progressive, please Stop Laughing). But should also offer liberal deductions.
Scary High Income Tax must include real choices and multiple tax deduction mechanisms which result in business owners being able to choose from a range of tax policies which can make the their overall taxes fair in a regressive income taxed based system.
For a happy income tax payer (if there will ever be one) must include choices that best benefits their particular types of needs. Ie. Big business, small business and start-ups. They all need different tax options. These tax benefits are for the employees of the businesses, not for the needs of government or society at large.
All society needs in the current tax paradigm is a healthy velocity of money and the inflation it causes regulated by the tax policy itself and Not the inflation caused by controlling fiat money supply. (Ie. Manipulating Interest Rates or Arbitrarily adding or contracting money from the market in a faux attempt to control the uncontrollable).
It is the natural constant velocity of money and the inflation of both salaries and expenses caused by tax policy and deductions that eliminates the need for massive government programs of the welfare state. People work their way to financial independence because Eisenhower tax policy uses psychology rather Voodoo to encourage businesses to pay good salaries and to fund job creating expansion.
With the encouragement of scary tax rates that offer real deductions, Businesses will avoid paying the government and pay their employees properly instead. The employees will then earn their own way out of welfare with pride, as the tax incentive is there to entice businesses to pay well. Not via a minimum wage but though the different tax policies they can choose, except the choice not to pay anyone, either the government nor their employees. Hence the need for scary high tax rates as I already stated.
Due to the implementation of Income taxation, It takes a government willing to tax all businesses and high income earners heavily because they do not automatically grow their companies and expand solely because their wallets get fatter from not paying high taxes. They do serious market research and their reports never say..... ‘if you raise salaries consistently, people will buy more of your products because they’ll then have the money to do so’. No, They only expand when they see lots of people with money buying things in their stores.
Unless consumers have real disposable incomes, the elites will not have any reason to expand their companies to serve a non-existent customer. But instead the Voodoo has caused stagflation, and has resulted in progressives attempting to find more dystopian ways to provide a governmentally sponsored universal income.
The Voodoo Economics that we have today and that Trump wants to continue, results in a slowly shrinking economy, as the elite, because of low taxes, hoard wealth causing consumers to band together and take it back through the power of consensus and misguided welfare taxation.
Giving Business owner’s a choice by creating competing economies through tax policy is the key to unlocking and unleashing a healthy velocity of money and healthy, semi-organic economy which takes people from welfare to a self sustainable income.
Formerly called Eisenhower Economics 101: Scary High Income Tax Rates combined with scary liberal and variable deductions, targeted at the three types of businesses discussed earlier, encourages tax free startups or reinvestment, growth and expansion or simply encouraging the behemoths of industry to hand out bonuses to get into a lower income tax bracket.
Variable tax policy and targeted deductions causes economic growth organically by giving business owners choices as to where their “Tax” Obligation lays.
Placing Higher “tax rates” on business owners while allowing deductions for self retooling, asset purchases and/or re-investments in their own business will either create jobs or higher salaries for the current employees. It will encourage owners to spend on expansion and grow; so as to grow equity rather than liquid wealth. (This tax structure encourages tax deductible spending and increases the velocity of money, which is good for the economy.).
Thus, creating tax deductions that cause growth based spending and investments on oneself and his employees to avoid paying the government is a good thing for America.
Reaganimics Or Voodoo Economics penned by Bush Sr. Or trickle down economics assumes people with great personal wealth automatically expand and grow to hire people but as we can see that hasn't really happened.
The current upward trending is a bubble and will burst just like it did at the end of Bush Jr.’s presidency. The cycles of boom and bust since Reagan took office are self evident.
When Carter was president we had high inflation and high taxation but limited deductions caused by the New Deal progressives.
Johnson’s policies tries to balance the scales of racism but instead continued the racist policies of American Apartheid, providing the poor (predominantly black at the time) with regular slave like income. Also, Johnson’s regime funded the Korean & Vietnam wars, so heavily that by the time Nixon was elected, the treasury was so bankrupt we had to fully leave the gold standard and created the petrodollar by agreement with OPEC; causing the deductions loss of our sovereignty to OPEC and the FED.
The businesses eventually revolted and resulted in implementing Reagan’s voodoo. But, back before then, single income homes were the norm. (Except for minorities). Now everyone has to work and rent out the spare room to enjoy the same life styles we had when Carter was in Office.
Today, however, we have legislated integration and affirmative action, but still have the legacy of the New Deal consumer creation machine, expanded to HMOs and further to HMO’s on Steroids known as Obamacare; and expanded wars to the Middle East, that we almost have no hope of getting back to sound tax policy and incentivized deductions to eliminate the need for the New Deal.
A look farther back when Eisenhower was president it was the hay-day of comfortable living. (We had scary high taxes, spawning tax shelters, but also fair and targeted deductions).
The key word though, of the voodoo, is trickle down. That slows the velocity of money to a trickle and we need it moving pretty quick to get the regular Joe into paying taxes rather than expecting to collect earned income credits.
Remember when Bush Jr. had the treasury give everyone an advance on their tax return? He was causing velocity to stimulate the Economy.
Remember when Obama changed the Tax Policy to temporarily allow a choice to take the full deduction of the cost of recently purchased business assets or choose the current way to depreciate them over time? That was targeted to stimulate the economy during the 2008-2014 recession.
VooDoo Economics with no regulatory controls, wrongly recommended by Neocon think tanks, places control of expanding the economy in an the stock market rather than where it should be; on an intelligently designed semi-organic system that encourages self expansion and growth that organically Creates Jobs; But again, doing so requires a scary high income tax rate that exempts specifically this type of spending... growth and expansion creating jobs.
The current voodoo encourages taking on debt to expand a company because currently direct spending of un-mortgaged Capital on growth isn't deductible like it was under Eisenhower.
Eisenhower Economics VS Voodoo Economics. We have seen the results of both.
Scary High income tax rates with targeted deductions that stimulate growth using psychology rather than Wishful Voodoo; Voodoo which ends in the stagflation we saw happen to Bush causing businesses to lobby for even less taxation.
There are other regulatory factors which negatively affect the economy but none more-so than how taxation works against business expansion; which expand only when profitable to do so. Again, When large amounts of consumers have real disposable wealth they earned from their actual labor they cause organic Velocity; not the kind caused by government handouts which progressives have been so intent on creating since the year they created the HMO under Nixon.
Again, The key of Eisenhower Economics is the psychology of limited choice and targeted deductions.
