The real unemployment rate, including those forced to work part- time, is at 16 percent. The U.S. Census Bureau said last month that the number of Americans in poverty has risen to 15.1 percent of the population and includes 22 percent of all children -- the highest its been since 1993.
Obama's job approval polls are stuck in the 40-to-41 percent range, and no president since FDR has won a second term with unemployment as high as it is now.
All of this has opened up a much-needed debate on tax cuts among Republican presidential candidates who've proposed tax incentives to unleash capital investment that will trigger stronger economic growth and job creation.
Business executive Herman Cain has his 9-9-9 flat tax plan that would impose a 9 percent national sales tax on top of existing state and local sales taxes. For millions of mid-to lower income Americans who are living paycheck to paycheck, it would mean higher taxes, according to many economists and the Wall Street Journal.
Texas Gov. Rick Perry, a late-comer to the presidential sweepstakes, has hastily thrown together a 20 percent flat income tax plan in an attempt to rescue his sagging bid for the nomination.
Perry would give taxpayers the option of taking the flat rate or filing under the existing system with its loopholes, credits and tax giveaways. Most of the wealthy of course "don't pay 20 percent now, so don't count them to volunteer for Mr. Perry's plan," economist Peter Morici says.
Neither will the 40 percent of lower income Americans who now pay no income taxes.
To his credit, Perry's plan calls for slashing government spending to 18 percent of GDP, but the bipartisan "super committee"
can't seem to agree on a $1.2 trillion deficit-cutting savings package, let alone the sizeable spending cuts he's called for.
There is much appeal to the flat income tax idea among a lot of Americans who think it would insert fairness into our tax system, but the unmoving political reality is that it stands no chance of passing Congress, now or in the foreseeable future.
What can pass Congress is a fullscale overhaul of this monstrously complex, inefficient and inherantly unfair tax code. A simplification plan that eliminates costly special interest tax breaks and other loopholes and lowers the tax rates accordingly.
Mitt Romney, the presumed frontrunner has proposed a far broader plan that calls for expanding trade, domestic energy, and deregulation reforms, cutting corporate taxes to 25 percent, and erasing capital gains taxes on incomes under $200,000, and ending the estate tax.
He'd keep the Bush income tax rates for now, while developing a lower-tax rate reform plan that can muster a majority on Capitol Hill.
Obama wrongly thought he could spend his way out of the recession by doling out borrowed tax dollars on parts of the economy, i.e. public sector jobs, and infrastructure projects here and there.
He failed miserably.
The formula for growth and jobs is to free the economy from oppressive taxation and regulation and unlocking trillions of dollars in private risk capital that is the life blood of a prosperous nation.
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