Monday, May 05, 2003

The Economy Is on the Move -- Downward

"... Both Alan Greenspan and the Congressional Budget Office agree that the Bush tax plan won't stimulate the economy. The best and the fastest way to get more money into the pockets of people who are likely to spend it quickly is to cut the taxes of average working people. Most people pay more in payroll taxes — primarily for Social Security and Medicare — than they do in income taxes. So a temporary cut in payroll taxes — say, by exempting the first $15,000 of income from payroll taxes — would put an extra $1,200 into most working people's wallets this year alone. And because businesses wouldn't have to pay their portion of that payroll tax, they'd be encouraged to keep more workers on the payroll. Purists will complain I'm endangering Social Security because that's where most payroll taxes go. But they don't understand (or won't admit) that the Social Security trust fund is nothing more than an accounting device, and Social Security is a pay-as-you-go system. The best way to make sure Social Security is there for boomers is to get this economy moving again, as quickly as possible. That's also the best way to get more Americans working. The Bush tax plan won't do it." -- Robert B. Reich, secretary of Labor in the Clinton administration, is a professor of social and economic policy at Brandeis University. Published on May 1, 2003 by the Los Angeles Times Link found at >>Full story...

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