“Our country’s problem is not primarily economic. It’s political. Globalization is a competition among nations to attract investment and production as each nation builds its economy. But the United States is not competing, not building its economy. Corporate America, the principal entity to create jobs, is offshoring jobs faster than we can create them.
The job for the president and Congress is to have Corporate America create jobs in America. We must return to our roots.In his first message to the Congress, George Washington emphasized manufacturing to build the nation’s economy. And the United States built its manufacturing and economy on protective tariffs. We didn’t pass the income tax until 1913.”…
…“Today we need a value added tax that’s rebated on exports. The corporate income tax is not rebated. All the president and Congress need to do is to take the tax break the government gives to offshore jobs and give it to Corporate America to onshore jobs — cancel the corporate tax and replace it with a 6 percent value-added tax.
Since there are no loopholes in a VAT, we have instant tax reform — and the tax lawyers will howl. It puts them out of business. We can eliminate most of the tax lawyers and lobbyists in Washington and give control back to the people’s representatives.
A VAT is easily implemented with computers. One hundred and forty-one countries compete in globalization with a VAT and don’t find it regressive or a “money machine.”
Last year, the corporate tax produced $194.1 billion in revenues. A 2010 VAT would have produced $700 billion. Exemptions of $70 billion for the poor leaves $630 billion to pay down the debt. Canceling the corporate tax permits Corporate America to invest $1.2 trillion in offshore profits to create jobs in the United States.
Since the VAT is self-enforcing, we can eliminate much of the Internal Revenue Service and cut the size of government. So rather than a jobs bill that is little more than welfare, the president should submit this tax cut with a VAT that takes the government off steroids, allows Corporate America to make a profit in the United States, stops the hemorrhage of offshoring jobs, promotes exports, gives instant tax reform, gets rid of the tax lawyers, cuts the size of government, provides billions to pay down the debt and creates millions of jobs.”