Thursday, February 03, 2011

Suggestions to raise government revenues

From the founding of our nation up until the establishment of income tax, our country supported itself primarily with tariffs. The real death blow to our national income from tariffs came with NAFTA, CAFTA, FTAA, et al.

Now that the flawed theory of unregulated markets has been shown to be a major contributing aspect of our economic failure, it seems logical that we should reinstitute some tariffs. However, this time we should take advantage of the technology and index labor, health, environment and pension costs.
Here is how it would work: Specific jobs would be assigned a labor index. For example a production seamstress in India earns 10 cents an hour while a production seamstress in the U.S. earns $10 per hour. The import labor index factor into the U.S. could be something like -- 100. That way, the cost of labor would be equal in both countries. Similar index factors could be applied for health, environment and pension costs.

The end result would be a leveling of these variable costs between different countries and thus create no incentive or advantage for corportions to export manufacturing plants. At the same time, we should experience an increase of income from a reivieved tariff program.

Terry Sneller 1/17/11

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