The Law of Love

Tag: economy

  • Wealth and Income Tax Reform

    Modest Wealth Tax (1–2%) on Top 1–2%

    A wealth tax of 1–2% on the top 1–2% of Americans would generate hundreds of billions in revenue annually, targeting dormant capital while avoiding disruption of productive investment. With the top 1% holding more wealth than the bottom 90% combined, this tax would help counterbalance systemic inequality without discouraging entrepreneurship.

    Income Tax Hike (2–4%) on Top 10–20%

    Increasing income tax rates by 2–4 percentage points on the top earners ensures those who gain most from the system reinvest in its health. This group currently benefits from historic wealth appreciation, globalization, and tax avoidance schemes. Modest rate hikes restore balance and fund essential services.

    Targeted Spending Cuts

    Cap Non-Essential Cuts at 10%

    A 10% reduction in discretionary spending (excluding Social Security and healthcare) would streamline government without harming the social safety net. Defense, corporate subsidies, and bureaucracy can absorb smart cuts through modernization and oversight. Social Security and healthcare should be treated as independent programs with their own sustainability paths.

    Close Wealth Borrowing Loophole

    Tax Personal Consumption Borrowed Against Assets

    The ultra-wealthy often borrow against investments to avoid capital gains tax. A progressive consumption tax on borrowed funds used for personal spending closes this loophole, ensuring wealth consumption is taxed fairly, just as working-class consumption is.

    Fiscal Discipline Through GDP-Based Budgeting

    Anchor Spending to GDP Ratios

    Fixing discretionary spending categories as percentages of GDP stabilizes government finances. For example, defense might remain at 3.5% of GDP annually. Congress retains override power during recessions or emergencies. This mechanism minimizes debt-ceiling brinkmanship while allowing automatic fiscal discipline.

    Targeted Support for Low-Income Americans

    $100 Stipend + $100 in Food Aid

    Individuals earning below the median income would receive $100 monthly in cash and $100 in food assistance. This modest supplement reduces economic pressure without bloating the budget. It also avoids the inefficiency of universal basic income by targeting those most in need.

    Work Requirements

    Requiring part-time work, job training, or volunteer service reinforces the principle of mutual responsibility and maintains political support across the ideological spectrum.

    Student Loan Reform

    Income-Based Repayment System

    Replace student loans with a policy where graduates pay 5–10% of their income for 10 years. The government provides colleges with the net present value of future graduate contributions, incentivizing institutions to prioritize economic value.

    Curriculum Reform

    Require basic foundational courses while encouraging colleges to align degree programs with real-world economic needs. This avoids overproduction in low-demand fields and raises the value of postsecondary education.

    Health Care Reform

    Cost Containment Before Expansion

    Other nations cover everyone at half the U.S. cost. We must first adopt cost control via:

    • Expanding Medicare-style price negotiation to all payers
    • Capping administrative costs
    • Converting insurance companies into regulated nonprofits

    Universal coverage is only feasible if we address these root inefficiencies first. Without cost control, expansion could bankrupt the system.

    Election Structure Reform

    Replace Plurality Voting with RCV or STAR

    The current winner-take-all voting model fuels polarization and discourages new ideas.

    • Ranked Choice Voting (RCV): Voters rank candidates, and instant runoffs ensure winners have broad support.
    • STAR Voting: Voters score candidates, and the top two enter a runoff where majority support prevails.

    These systems reduce spoilers, empower moderates, and foster coalition building.

    Campaign Finance Reform

    Restore Voter Trust and Reduce Corruption

    • Publicly finance campaigns to reduce big donor influence
    • Cap political donations and independent expenditures
    • Close loopholes for Super PACs and dark money
    • Require real-time disclosure of political spending

    These measures are essential to ensure democratic legitimacy and reduce regulatory capture.

    Housing Access and Regulation

    Boarding Houses and Micro-Housing Development

    Encourage the development of communal housing with private rooms and shared amenities, priced at 1/3 of residents’ income. This model supports workforce housing in cities and dignified shelter for low-income individuals and families. Government can support via zoning reform, low-interest loans, and public-private partnerships.

    Limit Property Accumulation

    • Primary residences are tax-exempt
    • Second homes taxed at 10% of income produced
    • Third at 20%, and increasing to 90% for excess holdings
    • Foreign ownership of residential real estate prohibited

    These measures prevent speculative hoarding and prioritize housing for residents.

    Incentivize Vertical Development

    Apply per-building taxes to apartment complexes to encourage vertical over horizontal development, improving density and affordability.

    Illegal Immigration and Labor Reform

    Rational, Humane, and Enforceable Framework

    • Raise minimum wage to $12.50/hour—a historic average that balances inflationary risk with humane compensation
    • Cap undocumented worker pay at the same minimum wage
    • Grant two-year window for undocumented immigrants to register as guest workers
    • Allow employers to house and provide medical care to guest workers
    • Enforce E-Verify nationally
    • Defer wall construction, but keep the option if enforcement fails
    • No constitutional rights or voting privileges for guest workers
    • Maintain birthright citizenship, unless legally reconsidered

    This balances market need, compassion, and enforcement. It stabilizes immigration flows and protects American labor.

    Conclusion

    This policy framework reflects a comprehensive and integrated approach to 21st-century governance. It emphasizes:

    • Fiscal sustainability
    • Economic fairness
    • Regulatory discipline
    • Political reform
    • Social safety without dependency

    It bridges partisan divides by rooting each proposal in practical benefits, fairness, and systemic integrity.

    We cannot address 21st-century challenges with 20th-century thinking. Restoring the “policy” in politics starts with vision, courage, and a return to principled pragmatism.

    -### **Treat Guns Like Cars – Within Reason**Treating guns like cars offers a regulatory framework that balances rights with responsibility.*

    **Driver’s License = Firearm License**: You need a license to operate a car after passing written and practical tests. Requiring gun owners to pass safety and competency tests could reduce accidental shootings (approx. 500 per year in the U.S.).*

    **Vehicle Registration = Firearm Registration**: Cars must be registered and renewed periodically. A similar model for firearms could help trace weapons used in crimes—important since over **200,000 guns are stolen each year** in the U.S.*

    **Insurance**: Auto liability insurance incentivizes safer behavior. Firearm liability insurance could create market-based pressure for secure storage and safe use.>

    **Note**: We don’t register cars solely because they’re dangerous but because they’re used in public and have major third-party risks. Guns kept at home for self-defense may not need the same oversight as concealed carry.

    —### **Social Security Reform – Shared Sacrifice, Smarter Strategy

    **1. **Lift the Payroll Tax Cap** Currently, only income up to **\$168,600 (2024)** is taxed for Social Security. This means someone making \$1M pays the same Social Security tax as someone making \$168k. * **Effect**: Removing the cap could **eliminate 73%** of the projected long-term Social Security funding gap (CRFB, 2023). * It also helps restore fairness; over 90% of earners pay on all their income while the top 5–10% do not.

    2. **Modest Benefit Cuts for High Earners** Cutting Social Security benefits by 10% for the top 20% of earners would save money without harming low-income retirees. * Top earners typically have other retirement income streams (401(k)s, IRAs, investments). * The Social Security Administration estimates that **higher-income retirees rely on Social Security for only \~20%** of their income, compared to **90% for low-income seniors**.

    3. **Increase Payroll Tax by 2 Percentage Points** The current combined payroll tax rate is **12.4% (6.2% employer, 6.2% employee)**. Raising this to **14.4%** would gradually and broadly shore up the trust fund. * Cost for median income worker (\~\$60k/year): \~\$600/year more. * Would **close around 44% of the solvency gap** if phased in slowly (SSA data).

    4.**Invest in Real Estate Rental Funds** Currently, Social Security Trust Funds are invested solely in low-yield Treasury bonds. * Real estate, particularly residential rentals, provides **3–5% annual returns**, plus inflation protection. * A **diversified investment strategy** (like Canada’s pension plan) could yield higrher long-term returns, improving sustainability. * For example, **the Canada Pension Plan Investment Board (CPPIB)** invests in infrastructure and global real estate and earned an average **10-year return of 9.6%** (as of 2023).—

    ….

    The Correlation Between Union Power and Income Inequality

    In contemporary American political discourse, the issues of income inequality and the role of labor unions are often debated, with a growing number of voices arguing for a stronger correlation between the two. As illustrated in a recent social media post from Robert Reich, historical data suggests a powerful inverse relationship: as union membership in the United States has declined, the share of national income held by the wealthiest 10 percent has steadily increased. This trend suggests that the weakening of labor unions has been a significant factor in the widening of the wealth gap.

    Historically, labor unions served as a crucial counterbalance to corporate power. By organizing and bargaining collectively, unions were able to secure higher wages, better benefits, and safer working conditions for their members. This collective action not only benefited union workers but also exerted upward pressure on wages in non-unionized sectors, as companies sought to remain competitive in the labor market. The graph in question shows that during the period when union membership was at its peak—from the mid-20th century into the 1970s—the share of national income going to the top 10 percent was at its lowest. This period is often referred to as the “golden age” of the American middle class, characterized by broad-based prosperity and reduced income disparity.

    However, starting in the latter half of the 20th century, union membership began a long-term decline due to a combination of factors, including political opposition, anti-union legislation, and shifts in the American economy from manufacturing to services. Coincidentally, as union power waned, the share of national income captured by the wealthiest Americans began a sharp ascent. This parallel trend suggests that without the negotiating power of unions, a larger portion of the wealth generated by the economy has flowed to the top, rather than being distributed more broadly to workers.

    The argument, therefore, is that a robust union presence is not merely a matter of protecting workers’ rights but is essential for maintaining a more equitable society. If the goal is to address the growing issue of income inequality, then rebuilding and strengthening labor unions may be a critical step. Advocates of this view argue that empowering workers to bargain for a fairer share of profits could help reverse the trend of widening disparity, re-establish a strong middle class, and create a more balanced and just economic system. The graph serves as a powerful piece of evidence in this argument, suggesting that the path to a more equal society may lie in a return to the principles of collective action and worker solidarity that defined a previous era.

  • federal debt may not be that bad, just an accounting thing

    i personally believe too much debt is bad. but this guy below has another argument. it’s over my head. i think there’s some truth to what he says, but i don’t know. i know there are a lot of people smarter than me here, so maybe one of ya’ll can argue with what is posted below.

    Is the natinoal debt and deficit bad?
    Nowhere do these CRFB folks define what the National DEBT is.

    They don’t know.

    Yet, they screed about it as if they do.

    Our national debt is comprised of Treasury securities purchased by individuals firms and governments domestic and foreign who wish to preserve the value of their dollars.

    Ergo, the transfer their non-interest bearing dollars from checking accounts to purchase interest-bearing Treasury securities.

    The dollars used to buy the T-securities go into reserve accounts at the Federal Reserve and the T-securities are kept in security accounts at the Federal Reserve.

    In no way can these purchases (exactly like your purchase of a CD) be construed as debt.

    Interest is credited to T-security accounts by debiting the aforementioned Reserve accounts. No tax dollars are ever involved in paying interest on these SAVINGS ACCOUNTS.

    The DEBT CLOCK on 6th Ave, NYC is pure fraud. It does, however, record all the dollars that have been spent by the Federal government since 1778 and not yet taxed. The $20 trillion-plus represents our National Savings.

    Government debt is a private asset. You and I do not OWE government debt, we OWN it. Indeed, the only source of net dollar-denominated financial wealth is Federal government T-securities.

    Here’s a solution. Once the federal T-security sales reach $21.1 trillion, the Treasury would be prohibited from selling any more bonds. Treasury would continue to spend by crediting bank accounts of recipients, and reserve accounts of their banks. Banks would offer excess reserves in overnight markets, but would find no takers—hence would have to be content holding reserves and earning whatever rate the Fed wants to pay. But as Chairman Bernanke told Congress, this is no problem because the Fed spends simply by crediting bank accounts. (L. Randall Wray) https://goo.gl/m9hdQW

    https://goo.gl/NCKV1E
    https://goo.gl/nTxJRH
    https://goo.gl/FQanLC

    As for the Federal Deficit, they WRONGLY believe the Federal deficit is a bad thing.

    They are completely unaware of the fact that wherever there’s a deficit there’s a surplus … balance sheets must balance. A sovereign government deficit is nothing to fear. It is simply the mirror image of the non-government sector’s saving. As the US private sector retrenched to rebuild its balance sheet, the government’s balance moved toward deficit. There is an unrecognized identity at work. Domestic Private Balance + Domestic Government Balance + Foreign Balance = 0.

    In the case of the Federal budget deficit, it is equal to the penny to net financial surpluses in the non-government sector.

    That’s money in our checking accounts.

    When the gov spends that becomes income to individuals and firms in the private sector. It’s the new money that enters the economy interest-free and is essential in its contribution to economic growth. https://goo.gl/Fq9fKD

  • balanced budget amendment – spending as a percentage of GDP

    balanced budget. congress should set every item in the budget, except social security and health care, to be the same percent of GDP every year. like defense spending might be twenty percent of GDP, and it will stay that way every year even as our GDP rises.

    the exception, is that congress can always pass legislation on a case by case basis that deviates from this norm. by having this overall balanced budget approach, we will avoid the yearly debt ceiling fights that we see every year. those are risky, and they’re not sustainable. 

    of course, someone will complain that GDP shrinks during recessions. historically and practically, though, that’s not a big deal. as was said, congress can always pass legislation on a case by case basis to deficit spend even more so. but just as importantly, though, is the fact that GDP doesn’t shrink much during recessions, usually just a few percent. even during the great recession, GDP only shrunk 5 percent…. so, a 5 percent spending cut isn’t that big of a deal. of course, during the great depression GDP shrunk 30 percent… so congress would need to use its case by case power to deal with that sorta situation, cause there are no good options during those times other than to deficit spend to stimulate the economy but maybe not too much, it’s their judgment call. 

    the reason social security and health care are exempted, are because those are expected to change over time, given the government has been borrowing against medicare and SS and currently is trying to pay them back and demographics change over time. the thing is, with these debt ceiling fights, republicans are trying to cut say spending on say food stamps, in order to have enough money to pay social security back. that’s the way our accounting is structured. that choice shouldnt exist… social security should just do its own thing and rise and fall on its own merit. it shouldn’t come at the cost of other programs, such as food stamps. forcing a choice between paying seniors more and paying poor people less (or giving less food to hungry people) shouldn’t be a thing that politicians do. social security can be figured out on its own and congressmen will be forced to reckon given by 2033 the trust fund is going to run out of money and can only pay 80 percent of benefits. maybe taxes on the rich can go up on their payroll tax, benefits for the rich can be cut, retirement age can go up, maybe everyone can chip in a little more on their pay roll taxes. point, solutions are out there, but it shouldn’t be intermixed with other governemnt spending. one of the biggest mistakes ever congress made was borrowing against social security and medicare. and on that point, healthcare spending needs to be tackled on its own just like social security, for many of the same reasons.