Karl’s economic stimulus plan
It seems that the government is dead set on spending somewhere in the neighborhood of $825 billion to “stimulate the economy.” With a hearty hat-tip to Louis Gohmert (R-Texas), let me propose the following. In 2007, the federal government collected $1.1 trillion in individual income taxes. Why not just declare a tax holiday for nine months and let people keep their own money? The cost would be approximately $825 billion in unseized revenue and would immediately place that money in the hands of consumers. Even better, into the hands of consumers who have earned it.
There are two reasons why this plan will never be adopted, let alone considered. First, if the American people were ever allowed to keep their own money, it would reveal to them the extent of government thievery. When the holiday ended, there would undoubtedly be clamoring for reduced spending in Washington and what elected official wants that? That’s where all their power resides – in the ability to take money by force from those who have earned it to reward those who haven’t.Plus, the boon that such a plan would have to employment in this country would immediately be reversed upon the expiration of the holiday.
The second reason is (get ready to cry), some people who are unemployed would miss out on the holiday. Neal Boortz made a very similar recommendation on his radio show and, I swear, this was the leading criticism of the plan. People who are unemployed, who are not producing, would be left out of the goodies. Maybe that would provide them an incentive to get a job. Just a thought.


February 2nd, 2009 at 11:45 am
I think a 9 month holiday is a great plan. In fact, let’s make it a year! This has the double benefit of increasing liquidity in the market and eliminating the AMT!
The Fed would still get theirs through the estate tax, excise taxes, licensing taxes, etc…. Plus, what do they care about having enough money? They have demonstrated a propensity to spend regardless of their bank statements. And it’s not like the party in power pays any tax. A la Daschle, Rangel, Geithner, etc…
February 2nd, 2009 at 11:58 am
Well now, Bill, you’re busting the budget. Let’s not get crazy, shall we?
February 5th, 2009 at 6:38 pm
This reminds me of Bob Murphy’s recovery plan, posted on mises.org a couple of days ago: Eliminate all personal and corporate income taxes, cut federal expenditures by $1 trillion per year, cancel all bailout packages, abolish the minimum wage.
Might be a bit challenging to sneak it through Congress, methinks. But a worthy ideal!
http://mises.org/story/3316
February 5th, 2009 at 7:22 pm
Outstanding. I suspect he may have borrowed a bit here and there from my proposal, but he rounded it out nicely with new proposals and, while I can’t say they were original to him (he may have borrowed them from others), they were not borrowed from me. I’m happy to have been able to contribute in whatever small way.
February 6th, 2009 at 10:47 am
We can refer to it as the “Karl-Murphy Plan”.. or “Austro-Karlian economics”