There’s a lot of talk in Washington about yet another so-called “stimulus” package. If the next one is anything like the last one it will simply be a mechanism for taking money away from people who aren’t spending it the way politicians would like, and transferring it to people who will. Our soon-to-be ruler feels like adding some grandiose public works projects (raking leaves in a National Forest) to the list.
Let’s break away from these political stimulus ideas for a few minutes and study an absolutely brilliant idea from Texas Republican Congressman Louie Gohmert. Now Louie hasn’t been around the halls of congress all that much (just three years) so he is not yet all that acclimated to the Washington lust for absolute power. If he were, he never would have come up with this idea.
You’ve heard of K.I.S.S., haven’t you? This acronym is a standard for sales weasels everywhere. Keep It Simple, Stupid; and that’s exactly what Gohmert has done to the stimulus idea. He kept it simple. The problem is … government doesn’t do simple.
Here’s the deal. The Imperial Federal Government of the United States collects about $167 billion a month in income and withholding taxes. The Congress has already passed a $700 billion stimulus bill, and about a half of that is gone, leaving $350 billion of your money in the pot. Some have suggested that this $350 billion be left as some sort of a bailout/stimulus slush fund for the incoming Obama Administration. In other words … let the politicians figure out how to spend it. Gohmert thinks it might be a better idea to allow the people who actually earned this $350 billion to spend it as they see fit. OK, if you have any appreciation at all for the concept of economic freedom that sounds like a good idea; but how do you make it work in this instance.
First, a math problem. Divide $350 billion, the amount of the bailout bill not yet spent or promised, by the $167 billion per month our government collects in income and payroll taxes. I know … government educated. So we’ll make it easy and round it off to two. The $350 billion is just a bit over two times the amount of income and payroll taxes our government seizes in one month.
OK .. here’s where the K.I.S.S. comes in. The government simply absorbs the remaining $350 billion from the stimulus bill and suspends the collection of all income and payroll taxes for two months. Even trade. This means that for two months you get your entire paycheck (well … less any State withholding). The government ends up with the same amount of money in its coffers, and the income earners in this country have some extra money to spend – an average about $2,000 per taxpayer – over the following two months.
First let me tell you why this is such a great idea. This plan puts the economic stimulus money right into the hands of the people who actually earned it in the first place. Can you imagine that? The people who earned the money get to decide how it is spent! The people who are driving our economy by working and earning enough money to pay income taxes get to pick the marketplace winners and losers as they spend their stimulus dollars! The politicians don’t get to chose who will have stimulus money to spend, and they don’t get to decide how that money will be spent. Isn’t it wonderful to just think about taking power away from politicians!
Now that I have you all charged up, let me give you two good reasons why the Gohmert plan is doomed from the start. Actually, I’ve already given you one reason. With the Gohmert plan the politicians don’t get to decide who gets to spend the stimulus money. This doesn’t thrill politicians. Somehow the very act of getting elected to high office seems to imbue politicians with some sort of a supernatural power to know exactly how every dollar in our economy is to be spent. The Gohmert plan would take that right away from them. Those Washington creatures are mostly Democrats. They want people who vote for Democrats to spend that money, not evil entrepreneurs and high-achievers who show this nasty little tendency to vote Republican.
The second reason this Gohmert plan (as brilliant as it is) is toast would be because for two months it would allow income-earners to see exactly how much they earn. Up until now these people have been operating on the basis of their “take-home” pay. Ask them what they actually made in any pay period and they wouldn’t have a clue. When they get four bi-weekly paychecks with no withholding their eyes are likely to bug out like a stomped-on bullfrog. Can you imagine what happens after two months and those income tax, Social Security and Medicare tax figures show up on their paycheck stubs again? Well, the political class surely can; and it has something to do with pitchforks, baseball bats and a march on Washington. Tax Revolt.
Could something like this actually make its way through our Congress? Sure it could … if the voters demanded it. But hey …let’s get serious. I wonder what sort of celebrity dirt they’re going to dig up on Entertainment Tonight this evening?