The following is a replication of a letter that I sent to all of my Congressmen and to President Obama on December 18, 2012.
December 18, 2012
Senator Michael Bennett
458 Russell Senate Office Building
Washington, DC 20510
Senator Bennett:
John F. Kennedy said, "If a free society cannot help the many who are poor, it cannot save the few who are rich."
You are among our leaders and bear at least a portion of the guilt for bringing us to the "fiscal cliff." The idea that to raise taxes on the very rich would hurt the economy is moronic on its face. The former president of Brazil, Luiz Inácio Lula da Silva ("Lula"), with only a fourth grade education understood that economic recovery is better fueled from the bottom than from the top. Our economy is retail driven. A per-son making $1M per year, whether given more OR less disposable income, is not likely to raise or lower his/her consumer spending.
It is imperative that the plan to continue the tax reductions for just the lower 98% be implemented. In the spirit on which this country was founded, put your country first and find a compromise. Maybe the breaking point should be $500,000. Maybe as much as $1M. Find a compromise.
With respect to capital gains, I would suggest some level of exemption ought to be in place ... maybe as much as $200,000 ... to encourage in-vestments in new businesses (including IPOs) and real estate. Capital gains from passive investment in publicly traded stocks should be at the full tax rate for income. These investments do not provide capital for business expansion.
If you truly want to lower "welfare" costs (so-called entitlements, i.e. food stamps, housing subsidies, etc.) then raise the minimum wage.
Fast food workers, for example, aren’t just teenagers looking for a little spare cash. The typical fast food worker is 28 years old, and many of them have children of their own. Most cannot provide for themselves even the barest necessities of life on the minimum wages being paid.
Fast food workers are so underpaid that many rely on food stamps, Medicaid, housing vouchers, and other forms of public assistance to make ends meet while employers like Wal-Mart, and fast food giants like McDonald's and Burger King are costing taxpayers millions every year.
On the other hand, the top six CEOs — for McDonalds, Wendy’s, Burger King, Dominos, Papa John’s, and Yum Brands (KFC, Taco Bell, Pizza Hut) — earned $58 million in 2011 ($9.67 million average).
Overall, CEOs are paid 231 times more than average workers are. The average rate for CEOs is 733 times current minimum wage.
An alternative paradigm is possible. I read that Cosco pays its employees $17 and hour and benefits and the CEO earns a base pay of $500,000 per year ... a 20 to 1 ratio typical in the 1950s and 60s. UPS also has the reputation of treating its employees well.
Social Security is NOT an entitlement program ... we have paid for it. Failing to provide appropriate cost of living increases is to penalize those who have already served. Ditto Medicare. I am not opposed to eliminating benefits for people over a particular income level, say $250,000 and possibly reducing benefits between $150,000 and $250,000.
It's also really important to leave Medicaid alone. To cut this program will hurt the people least able to bear it.
If you (collectively) would open your eyes, you might see that something as simple as removing the FICA income cap would insure the viability of the Social Security system well into the future. As it stands now, the FICA is a regressive tax ... the type of tax to which we as a nation have always been opposed. In a concession to the wisdom of Lula, maintain lower rate(s) at the bottom levels of the income scale.
Behind retail, real estate and building is a preeminent driving force in our economy. Please do not tinker with the interest and property tax exemptions. While they may be subsidies to the real estate market, they are no more so than subsidies given other industries and to revoke these ex-emptions would be catastrophic to an already weakened real estate market and might possibly put the final nail in the coffin of the "American Dream."
I am in full agreement that federal government spending needs to be reduced. Ending the wars in Iraq and Afghanistan would contribute significantly to that end as would further reductions in military spending that could certainly be accomplished without jeopardizing our security.
John Kennedy also said, "Liberty without learning is always in peril and learning without liberty is always in vain." We are no longer leaders in education and that must change.
To summarize, (1) continue the Bush tax cuts for the 98% and raise tax rates for the upper 2%; (2) raise minimum wage to a level at which someone might have at least a glimmer of hope for providing the necessities (peo-ple should be rewarded for working, not penalized) and leave Medicaid alone; (3) Remove the FICA income cap; and (4) don't tinker too much with the tax code as it applies to the middle class (particularly real estate interest and property tax deductions).
"The future belongs to those who give the next generation reason for hope." -Pierre Teilhard de Chardin
Don't be contributory to the reason that Congress' performance rating is less than 10%. To paraphrase Ghandi, YOU must be the change we need to see in this country, and in the world.
Respectfully,
______________________________
Ben C. Alexander
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