The Best of US Tax Act and Stimulus Program

By Kerry Grinkmeyer
Last year our government spent $150 billion on a Stimulus Program in an effort to increase consumer spending and hopefully bring our economy back into a growth mode. In fact consumer spending did increase by 5% in May 2008 but most of that can be attributed to escalating fuel and food prices. Those Stimulus dollars that didn't go to fuel and food went towards flat screen TV's or other foreign made merchandise, resulting in more of our American dollars leaving our shores.In late 2008 we that tax payers agreed to give the financial industry $700 billion to clear up their bad debt and put them in a position where they could get back into the lending business thus stimulating the economy. We now know that the $700 billion was a drop in an ocean of bad loans and the banks are still in trouble, thus unable to extend credit to others because of their own financial problems.

The talk is that possibly the banks need to be nationalized which means that we the taxpayers will assume all of their self manufactured bad loans and our children and grand children will be faced with bring the U.S. banking system back to solvency. In the past week we the taxpayers stepped forward again to fund a new recovery program with a price tag of $1 trillion. This time we are told that these funds will not go to the banks, they will go to create jobs. This is certainly something that our country needs, as jobs have been leaving our shores for decades only to be accelerated as industry, retail, sales and construction have come to a stop in the United States over the past quarter. Over the past six months we have recognized that the financial structure of the best capitalistic system know to mankind is failing. It's hard to understand because of its size and scope, but if you think of the problem relative to your household it's simple. You've been spending more then you've been bringing in, you've been using credit like you've been using water; as if there was no end to the supply.

Now the tap has been turned off, you lay off the gardener, the maid, and the cook. The bank is at the door and your cars have been repossessed. What do you do? You get a second job and mom goes to work. Simply put you cut your expenses and you maximize your income.This is exactly what our government has to do. Cut all the pork out of the federal budget and raise taxes. The budget is being addressed and President Obama says he is going to raise taxes on anyone making over $250,000 per year.

This is a start but will not get us out of debt; but there is a way. The Best of the U.S. Tax Act will increase the federal tax on gasoline by $3.00 per gallon, put a $2.00 per pack tax on cigarettes and a $1.00 per six-pack of beer and fifth of whiskey. We consume 390 million gallons of gasoline per day, 50 million packs of cigarettes per day, and 21 million gallons of beer per day. In one year a $3.00 gas tax would generate $427 billion a year ($.4.7 trillion in 10 years), a $2.00 cigarette tax will generate $36 billion a year ($3.6 trillion in 10 years) and a $1.00 six-pack beer tax will generate $7.4 billion per year (7.4 trillion in 10 years). This is a total annual increase in income of $447 billion. These funds should be allocated to payoff our debt, and get our nation back on its feet.

We could address, national health insurance, we could have the best schools in the world, fund renewable energy research and we could fund cancer, Parkinson's, and stem cell research. In conjunction with the increase in these taxes we need fund The Best of the U.S. Stimulus Program. A $150 billion program offering consumers a free U.S. made automobile that gets 36 MPG or better when they turn in their gas guzzler for destruction. This program would take 7.5 million gas guzzlers off the road reducing fuel consumption by up to 833 gallons per year per auto or 6.25 billion gallons total. This would eliminate our need for 320,512,800 barrels of oil resulting in $45 billion not leaving our country each year; thus the program investment would be recouped in just over three years.

The auto replacement program represents 6% of the U.S.'s passenger cars and would reduce our nations overall fuel consumption by 4%, each year the program is in place. The Best of U.S. Stimulus Program, over 10 years, would reduce our oil consumption by 40%; we currently produce 25% of our need. With the added drilling in Anwar and the Gulf we could be producing 50% of our need within 10 years leaving less 10% needed from offshore; which we could get from Canada and Mexico. These figures do not account for the millions of Americans who would switch to more fuel efficient vehicles outside of The Best of U.S. Stimulus Program as a result of purposely pushing the price of gas up above $5.50 per gallon. U.S. auto makers sold 17 million cars in 2007 and sold 11 million cars in 2008 resulting in the probability of bankruptcy for one or more of the three. Under The Best of U.S. Stimulus Program each manufacture would be challenged to produce a four passenger auto and a six passenger mini van that achieved 36 MPG or better. The winner of the challenge would be guaranteed the sale of 7.5 million vehicles each year of the program.

The Best of the U.S. Stimulus Program will also address national health care. Today only 60% of U.S. citizens are covered by health insurance and yet our hospitals are over crowed. The current health care industry employs 14 million of us and accounts for $2.6 trillion of our gross national product. With national health care, which would provide health care for the other 40% of us, we could easily create another 5 million jobs. National health care is estimated to cost $36 million a year which could be paid for with our cigarette and beer tax. If this falls short we can put a tax on obesity by putting a federal tax on fast food. Join me in encouraging President Obama to increase the federal gas tax by $3.00, the cigarette tax by $2.00 per pack and the beer tax by $1.00 per six-pack and to create The Best of the U.S. Stimulus Program. Let's take control of our economy, our energy needs and our health care; it's easy if we have the will power to take control of our lives.