Fixing the economy

I don’t think the economy is that hard to fix. I am in the financial services industry and have been for about 13 years. I say that to say that it seems the "professionals" keep doing the same ineffective stuff and thus getting the same ineffective results. The market is 80% perception and the lack of trust in the market is really a lack of trust in those who make it move. And those who make it move aren't the little guys - they are those "Professionals." The market can be fixed in six months by doing three things –

1) Make personal interest deductible again. Give it a maximum of $10-15k per year. If personal interest (interest on loans, cars, credit cards, payday loan places) was deductible, the rate would fall as the government wouldn't want to subsidize the profits of big business. (The subsidy being the write off.) Bankruptcies would fall, more loans would be taken out and the prime rate would be a real number that positively benefited the little guy rather than just big business. Besides, with all the tax programs and incentives given to big business or foreign entities that are stacked on the backs of the taxpayer, it is about time that he is the beneficiary of one.

2) Impose a hefty tax or tariff on foreign imports while making Social Security and Medicare voluntary. Although fair trade increases competition, the tax would level the playing field in costs of goods in relation to inexpensive foreign labor vs. costly domestic labor. In addition, making SS and MC voluntary could lower the cost of labor for employers for those employees who opt out. This would bring home manufacturers and would create a disincentive for outsourcing and moving plants, offices and services overseas.

3) Raise the business mileage to $1.50 for companies and businesses with gross income of less than $5million. Since a significant part of the price of oil is speculative and big business is profiting from it while severely affecting small businesses, give small business owners a break. This will ease the effect for small businesses while not making the government subsidize all businesses.

Implement these three changes and the economy will bounce back immediately. If economists are serious in saying that the consumer and mom and pop businesses drive the economy, then give the consumer and mom and pop the break they really need to drive the economy. If the economists don't do this, then be prepared for an eternal financial purgatorial limbo.

Stay tuned for my solution to the mortgage crisis.