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DeMint Outlines Economic Growth Plan
Posted September 25, 2008 in Blog, Economy & Jobs
Today, U.S. Senator Jim DeMint (R-South Carolina) outlined a plan to stimulate real economic growth for American businesses and families through lowering taxes, reforming government failures, and immediately expanding domestic energy production.
“The proposed bailout is a trillion dollar band-aid that does not contain a single item that will stimulate our economy,” said Senator DeMint. “Now is the time to cut taxes on American investment, reform government failures, and expedite energy exploration so we can grow our economy. We must enact pro-growth economic solutions that will create jobs, open up our vast energy resources, encourage investment, and pave the way for long-term prosperity. Instead of giving government more power after its past failures, this plan provides our economy the tools it needs to work through this crisis and gives Americans the freedom to succeed. Given the serious problems we now face, we should all agree that a bold pro-growth economic plan is urgently needed with or without a bailout.”
REFORM A TAX CODE THAT DISCOURAGES CAPITAL FORMATION
• Suspend Capital Gains Tax for 2 Years, Index it for Inflation: Immediately suspend the capital gains rate from 15% for individuals and 35% for corporations on assets, including stocks, homes, and commercial real estate investments. This provision would unleash funds and materials to create jobs and grow the economy. After the two-year suspension, capital gains rates would return to present levels but assets would be indexed permanently for any inflationary gains.
• Reduce the Corporate Income Tax Rate: Reduce the corporate income tax rate, which discourages job creation and investment in the U.S., from 35% to 25%. For over a decade, the U.S. corporate tax rate has been 50% higher than the average among our counterparts in the industrialized world and nine key trading partners cut their rates during 2007. According to the Tax Foundation, the corporate tax quietly taps family pocketbooks for nearly $370 billion per year, over $3,000 per household, in the form of higher prices, lower wages and poorer return on investment.
REFORM FAILED GOVERNMENT REGULATION
• Suspend “Mark to Market” Accounting: Suspend the mark-to-market regulatory rules for long-term assets. These rules require financial firms to mark assets at current market levels, even where no market exists and any immediate transactions would result in fire-sale prices. Instead of allowing firms to mark these assets to their true economic value, these rules contribute to a downward spiral as firms have to evaluate their assets not on the basis of their long-term investment but rather on a short-term panic.
• Reform Section 404 of Sarbanes-Oxley: Make voluntary the duplicative reporting requirements under Section 404 of the Sarbanes-Oxley Act, allowing companies to comply with standards that better fit their size while still insuring that they protect their investors. The average compliance cost for a business under Section 404 is $3.8 million, with smaller businesses paying over twice as much in percentage of revenue as large businesses. Relieving this burden will reverse a policy that is chasing capital offshore and encourage more companies to go public in the United States.
• Repeal federal mandates for risky loans: Repeal the Carter-era Community Reinvestment Act, which requires banks to make loans available to borrowers who would otherwise be deemed as too high a credit risk, and who often cannot afford to repay the loans. Under this law that contributed to our current crisis, if banks don’t make enough risky loans, community organizers can take financial institutions hostage during regulatory proceedings when banks try to merge, acquire or otherwise alter their status.
EXPAND ENERGY EXPLORATION
• Repeal Bans on Energy Exploration and Expedite Production: Expedite offshore and oil shale exploration, ensure states share in energy revenues, and prevent endless litigation from frivolous environmental lawsuits. American reserves offshore are estimated to hold over 20 billion barrels of oil and 97 trillion cubic feet of natural gas. In the West, oil shale is estimated to be between 800 billion and 2 trillion barrels of oil — that is more than three times the proven oil reserves in Saudi Arabia alone. Permanently ending these bans on American energy will help fuel our economy and stop sending billions of dollars overseas for foreign oil.
REFORM FAILED GOVERNMENT INSTITUTIONS
• Schedule the GSEs for Privatization: Transition Fannie Mae and Freddie Mac over a reasonable time period to truly private companies without special government privileges and expose them to real market competition. This reform would 1) establish commonsense limits for their capital requirements and portfolio holdings relative to their size, 2) focus their mission on affordable housing only, not profit making, 3) require them to pay an appropriate risk-based amount for the government guarantee they enjoy, 4) subject them to state and local taxes and accurate SEC filings like every other private for-profit corporation, and 5) ultimately provide for the phase out of their GSE charters once their conservatorship has ended.
• Stabilize the Dollar: Repeal the Humphrey-Hawkins Full Employment Act, which diverts the Federal Reserve’s attention from long-term price stability to short-term economic growth. In an effort to fuel the economy, this additional mandate has encouraged the Fed to keep rates artificially low, leading to economic booms and busts, a rise in inflation and the decline of the dollar. This reform would require the Fed to establish a numerical definition for price stability and maintain a policy that promotes it over the long-term.
21 Comments to “DeMint Outlines Economic Growth Plan”
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Your proposals make too much sense and would save the taxpayers too much money.
This plan is right on. Me and my family are fully behind you.
Heard on Rush Limbaugh that you exposed Harry Ried’s attempt to hide his plan to restrict off-shore drilling the this economic recovery bill they are working on. Proud to have you as out Senator from the great state of South Carolina.
Respectfully,
David C Smith
Columbia, SC
Keep forcing accountability at all governorment levels.
Makes sense to me!
You’ve been talking to Newt
… and that isn’t a bad thing!
At last! A proposal that makes fiscal sense and correctly identifies the origins of this financial disaster; the CRA. Credit is due also to the Clinton administrations change in the banking rules which has resulted in a high percentage of foreclosures and credit defaults by those living illegally in our country. A fact which I have not heard mentioned by anyone except Michelle Malkin.
I support your plan completely and will promote it on my blog at Townhall.com. Unfortunately, I fear it will not have the support of our candidate in this cycle since Senator McCain seems more committed to illegal alien’s rights than to the citizens of the United States. You can count on me for support of this critical issue.
My husband (Eric) and I also don’t believe this government welfare program for Wall Street is the answer to the financial problem. The answer is to have factories and jobs here, not in China, and then people would have money to pay their mortgages. The government needs to insure this happens if they want to be involved and be helpful. China is poisoning its children and ours. Large companies have too much money invested overseas for this to be stopped. Ordinary people in the U.S. know this. Let the BIG deal people fall, and come back to earth. They are going to destroy America. Fight for us all. Thank You, Frances and Eric Merrell Sr.
thank you so much for remembering who you work for; it is truly refreshing to see someone who has not become corrupt, living in that city. We the people are tired of fixing everything with our pocketbooks. If Chris Dodd , Barrack Obama, etc that got our tax dollars to finance thier campaigns, should in good consciounce, return the tainted money. When people like Charlie Wrangle can defraud the people and see nothing wrong with keeping his job, shows us, how little they think we pay attention to their taking of our money; and mostly they were right. But now with what is going on with our money and this bail out everyone wants answers and assurrance that it won’t happen again. These things need to be made public because the regular media won’t do it. It would be nice if your counterpart in our state would remember that mavericks may be appreciated in Washington but not in the real America. If regulations aren’t put in will this happen again in five years………..THANK YOU FOR FIGHTING FOR THE PEOPLE WHO KEEP AMERICA GOING…………. Deb
We are behind you 100% on this! Makes a lot more sense than the government plan!
Senator Demint,
As a constituient of SC and an American citizens I request that you fight like hell for your outlined plan above. Do not quit. Do not waiver. You represent us in this fight for our nation.
Senator Demint,
As a constituient of SC and an American citizen I request that you fight like hell for your outlined plan above. Do not quit. Do not waiver. You represent us in this fight for our nation.
Smart and for the People. Can the people expect anything less from this particular group of House Republicans? No – they’ve been with us on oil, and now they are with us once again. There are limits to what the people can and will bear – never mind the media – Barney Frank has enough skeltons in his closet vis a vis this entire mess – hoping his chickens come home to roost soon.
Thank you for your thoughtful proposal on the economy. As a real estate agent, I have seen this coming for years. The Community Reinvestment Act has allowed gross missuse of loans. Please continue to stand strong and have courage. You are doing a remarkable job and really represent how most in SC feel about accountability. Thank you for all you do. Nancy C. Anderson, Chester, SC
Senator, I appreciate your aggressiveness in office and the plan is good. Just like all Americans have to do, the bailout plan should dictate a loan, with an interest rate over a period of time. In this way, there is a commitment, just like all Americans have, to repay this back and the financial worth will not be depleted. Your proposal to eliminate capital gains tax is also viable.
Struggling to be obedient to the laws of our land, I implore the leaders of this country to not make any decision over the weekend without addressing the plan to the American people to reach an overall agreement, however tough it may be. We all need to come together to confront this and be united with the direction we’re going to take.
Our nation was founded on the principals of trusting God. Our forefathers and leaders of our country always sought His wisdom over any decisions. Our country had prospered. Over the decades, the “political correctness” has taken away this foundation and we are facing its destruction. God breathed his warnings, greed is a sin. The political power of today is injected by this greed. We need to pray for the sake of our country.
Jim, I want to congratulate you on this, I really think that you need to be running for President!!! You have a handle on the real issues and problems and you are a person I believe we can trust with telling us the honest truth. Thank you and please don’t become one of the good ole boys in Washington…Keep doing what you are doing.
Senator:
I enjoyed meeting you at my Rotary Club prior to your election and have been following you since.
I appreciate your efforts and I feel that you are the only SC Senator I know that represents the views of myself and so many of my business and estate planning clients.My older clients are very concerned about the failure our elected representatives to REPRESENT us. You are our voice.
RE Baxter,CLU,ChFC
Your proposals will do more to solve the situation in the long-term but the real issue is America’s debt load at every corner. Baby boomers have been too self-indulgent and purchase-driven. It may almost be too late for our generation to learn better behavior patterns even if we change the tax codes etc. The banking sector is in crisis now because our generation is too undisciplined. They have become dependent on government to rescue them from irresponsibility. Now, we are soon approaching a period of tremendous wealth transfer between the generations, and I am concerned that baby boomers will “blow” the money. The bailout plan is very distasteful to me but there may not be another realistic way out in the short term. Right now, I am more in agreement with Presdient Bush.
Senator,
Your plan simply makes good sense. It’s hard for me to understand why any (other often insane) plan would even be considered.
I would add, however, that we go a bit further on the tax issue. I propose that we go to a form of the “fair tax” as immediately as possible. A tax plan that includes no payroll taxes and no more IRS would save billions for the government NOW and put cash in every working person’s pocket instantly. Do I hear someone saying “stimulus package” under their breath ? A national sales tax with no forms to fill out would fund the government . (Just have no taxes on food, clothing or shelter and limit tax amounts on automobiles.) Making sure that there were no taxes on savings and investment would flood our economy with all the Kennedy type money that is now parked offshore. This would surely loosen up the current credit situation.
Thank you for showing the country and South Carolina that there is a senator that does his job of representing we, the people. It is my hope that others will follow your example.
We’re with you 100%! Let us know if there is anything we can do to support you.
Senator DeMint,
Thank you for being on the side of the people! This plan makes so much sense… much more sense than a blank check!
I’m proud to call you my home state Senator!
Dear Sen. DeMint,
My husband and I like this plan very much. It’s the best one we’ve seen or heard about. I know some of the Dems who voted NO on the bailout came out today with an alternative plan that was better than the other one. We ask that you fight for this bill in the Senate and talk to Sen. McCain about supporting it. We do NOT want a bill that the taxpayers have to pay for! Thanks for listening to us and our prayers will be with you. We knew there was another way.
Janice Cargile