Balancing the Budget

[udx]

So what should congress do to balance the budget? Obviously we need to cut spending and while at the same time raise revenue, but what does that look like? Can we tax or way to prosperity?

If you could provide some source links with your responses it would be much appreciated. I think sometimes, regular people can actually arrive at better solutions than the ruling elite of either party.

In the Cayman Islands, none of the citizens pay any taxes. Tax revenue comes from tourism and tarriffs. The standard of living in the Caymans is very high.

To raise money we could place tarriffs on goods coming in from overseas..no matter what the nationality of the exporter is. This tax should be made high enough that it would be cheaper for companies to locate and hire here than to ship it here. This would increase our own tax base by putting our people back to work. Along with cutting wasteful spending this would work to balance the budget. An added bonus would be that the bigger the tax base, the less each individual taxpayer would need to be accountable for.

tarriffs is a bad idea that prevents competition and ultimately hurt the people in the end. Having tariffs is against the WTO free trade regulation in which US is a member. If you raise tariffs on foreign items, they would do the same to you in retaliation, ultimately the people would just pay more taxes and standard of living be lower because you have to pay more for everything now.

In today's world, in order for country to rise its standard of living it must have a trade surplus with foreign countries, you can't do that through tariffs.

Tariffs ultimately lead to higher tax burden on everyone as US is a net importer of goods.

I think we should pull out of the WTO.

Companies all over the globe want our business and will do whatever it takes to get it, including moving their businesses here to save on tarriffs. We consume and do it big time. Sony would come here if they thought they would lose out to someone else if they didn't. My husband works at a foreign owned company who is located here in Tn because it is cheaper for them to produce here than it is for them to ship it here. That combined with what is happening in the Caymans is enough to convince me.

Yes we are a net importer, what I am talking about will stop that. Companies will come here to avoid tarriffs and we would become exporters AGAIN. We were doing great before we joined the WTO and entered into all these trade agreements.

There's another suggestion Shiloh..we need to get out of NAFTA and all the other job killing treaties we have signed on to.

I doubt that would happen, US isn't the only market that people could do business with. I don't see much compelling reason for companies to come to US to sell exclusively to the US market (that is what they are limited to if they come to US because of retaliatory tariffs). US labor cost too much, unstable political bickering and uncertainty of national debt.

Chinese market is increasing at a rapid rate and would probably be on par with the US in a decade or two. Tariffs would hurt US competitively.

From macroeconomics we know that, free trade leads to the most efficient production and benefit for both parties involved. Having to produce everything and being entirely self-sufficient isn't really a good idea, although it sounds good.

Here is an article about tariffs.

"In almost all instances the tariff causes a net loss to the economies of both the country imposing the tariff and the country the tariff is imposed on."

http://economics.about.com/cs/taxpolicy/a/tariffs.htm

[udx]

So what should congress do to balance the budget? Obviously we need to cut spending and while at the same time raise revenue, but what does that look like? Can we tax or way to prosperity?

If you could provide some source links with your responses it would be much appreciated. I think sometimes, regular people can actually arrive at better solutions than the ruling elite of either party.

In the Cayman Islands, none of the citizens pay any taxes. Tax revenue comes from tourism and tarriffs. The standard of living in the Caymans is very high.

To raise money we could place tarriffs on goods coming in from overseas..no matter what the nationality of the exporter is. This tax should be made high enough that it would be cheaper for companies to locate and hire here than to ship it here. This would increase our own tax base by putting our people back to work. Along with cutting wasteful spending this would work to balance the budget. An added bonus would be that the bigger the tax base, the less each individual taxpayer would need to be accountable for.

tarriffs is a bad idea that prevents competition and ultimately hurt the people in the end. Having tariffs is against the WTO free trade regulation in which US is a member. If you raise tariffs on foreign items, they would do the same to you in retaliation, ultimately the people would just pay more taxes and standard of living be lower because you have to pay more for everything now.

In today's world, in order for country to rise its standard of living it must have a trade surplus with foreign countries, you can't do that through tariffs.

Tariffs ultimately lead to higher tax burden on everyone as US is a net importer of goods.

I think we should pull out of the WTO.

Companies all over the globe want our business and will do whatever it takes to get it, including moving their businesses here to save on tarriffs. We consume and do it big time. Sony would come here if they thought they would lose out to someone else if they didn't. My husband works at a foreign owned company who is located here in Tn because it is cheaper for them to produce here than it is for them to ship it here. That combined with what is happening in the Caymans is enough to convince me.

Yes we are a net importer, what I am talking about will stop that. Companies will come here to avoid tarriffs and we would become exporters AGAIN. We were doing great before we joined the WTO and entered into all these trade agreements.

There's another suggestion Shiloh..we need to get out of NAFTA and all the other job killing treaties we have signed on to.

I doubt that would happen, US isn't the only market that people could do business with. I don't see much compelling reason for companies to come to US to sell exclusively to the US market (that is what they are limited to if they come to US because of retaliatory tariffs). US labor cost too much, unstable political bickering and uncertainty of national debt.

Chinese market is increasing at a rapid rate and would probably be on par with the US in a decade or two. Tariffs would hurt US competitively.

From macroeconomics we know that, free trade leads to the most efficient production and benefit for both parties involved. Having to produce everything and being entirely self-sufficient isn't really a good idea, although it sounds good.

No one would have to sell exclusively with the U.S. market. Tariffs would not hurt us competitively because companies would come back home to avoid it. Already companies are beginning to due to tariffs.

My husband works in the tire industry. Due to tariffs against China on tires a new plant is being opened in S.C. One already there is being expanded and the 2 plants here in Tn are hiring. China can't afford to ship as many tires here as before with the tarriffs so Americans are going to work to take up the slack.

I don't know how old you are, but I am old enough to remember when we made our own goods and sold the leftovers overseas. Free trade has not benefited The U.S. We went from being a major exporter to being a major importer. We went from being a manufacturing economy to being a service economy. I can't even find a decent pair of socks anymore.

There are plenty of empirical evidence showing that tariffs don't work. You should read that article i posted. Yes tariffs could be beneficial to certain parties, but overall it is harmfull.

[udx]

"The gains from tariff policies are a lot more visible than the losses. You can see the sawmills which would be closed down if the industry is not protected by tariffs. You can meet the workers whose jobs will be lost if tariffs are not enacted by the government. Since the costs of the policies are distributed far and wide, you cannot put a face on the cost of a poor economic policy. Although 8 workers might lose their job for every job saved by a softwood lumber tariff, you will never meet one of these workers, because it is impossible to pinpoint exactly which workers would have been able to keep their jobs if the tariff was not enacted. If a worker loses his job because the performance of the economy is poor, you cannot say if a reduction in lumber tariffs would have saved his job. The nightly news would never show a picture of a California farm worker and state that he lost his job because of tariffs designed to help the lumber industry in Maine. The link between the two is impossible to see. The link between lumber workers and lumber tariffs is much more visible and thus will garner much more attention.

The gains from a tariff are clearly visible but the costs are hidden, it will often appear that tariffs do not have a cost. By understanding this we can understand why so many government policies are enacted which harm the economy."

http://economics.about.com/cs/taxpolicy/a/tariffs_3.htm

[udx]

That is the problem with government. Benefits are privatized while harm is socialized. Everyone try to get the most out of the government without regard for anyone else. Legal robbery.

[udx]

"The gains from tariff policies are a lot more visible than the losses. You can see the sawmills which would be closed down if the industry is not protected by tariffs. You can meet the workers whose jobs will be lost if tariffs are not enacted by the government. Since the costs of the policies are distributed far and wide, you cannot put a face on the cost of a poor economic policy. Although 8 workers might lose their job for every job saved by a softwood lumber tariff, you will never meet one of these workers, because it is impossible to pinpoint exactly which workers would have been able to keep their jobs if the tariff was not enacted. If a worker loses his job because the performance of the economy is poor, you cannot say if a reduction in lumber tariffs would have saved his job. The nightly news would never show a picture of a California farm worker and state that he lost his job because of tariffs designed to help the lumber industry in Maine. The link between the two is impossible to see. The link between lumber workers and lumber tariffs is much more visible and thus will garner much more attention.

The gains from a tariff are clearly visible but the costs are hidden, it will often appear that tariffs do not have a cost. By understanding this we can understand why so many government policies are enacted which harm the economy."

http://economics.about.com/cs/taxpolicy/a/tariffs_3.htm

Just a few example of how tire tariffs have provided jobs in my area.

Bridgestone plans to expand the plant in order to increase total capacity to 37,750 tires per day or 13.4 million tires annually. The expansion areas are slated to begin production during the second quarter of 2013, and will create more than 300 new full-time and contractor jobs in when fully completed in 2015.

http://www.tirereview.com/Article/97048/bridgestones_aiken_plant_marks_100_million_milestone.aspx

Bridgestone Americas' existing plant expansion and its new 1.5-million-square-foot plant,

http://www.aikenstandard.com/story/021312-economic-dev--3745261

Warren County Tennessee

http://www.truckinginfo.com/news/news-detail.asp?news_id=74785

Anyway, it is my contention that doing this in other industries as well would help us get out of debt. Everyone is free to agree or disagree. God Bless

Like i have said. Tariffs certainly may help few parties, but it hurts the economy as a whole. Economic studies would tell you that it is so.

Yes you are 'saving' jobs, but have you consider at what costs?

"The essay on Free Trade at The Concise Encyclopedia of Economics looks at the issue of international trade policy. In the essay, Alan Blinder states that "one study estimated that in 1984 U.S. consumers paid $42,000 annually for each textile job that was preserved by import quotas, a sum that greatly exceeded the average earnings of a textile worker. That same study estimated that restricting foreign imports cost $105,000 annually for each automobile worker's job that was saved, $420,000 for each job in TV manufacturing, and $750,000 for every job saved in the steel industry."

"In the year 2000 President Bush raised tariffs on imported steel goods between 8 and 30 percent. The Mackinac Center for Public Policy cites a study which indicates that the tariff will reduce U.S. national income by between 0.5 to 1.4 billion dollars. The study estimates that less than 10,000 jobs in the steel industry will be saved by the measure at a cost of over $400,000 per job saved. For every job saved by this measure, 8 will be lost."

"The cost of protecting these jobs is not unique to the steel industry or to the United States. The National Center For Policy Analysis estimates that in 1994 tariffs cost the U.S. economy 32.3 billion dollars or $170,000 for every job saved. Tariffs in Europe cost European consumers $70,000 per job saved while Japanese consumers lost $600,000 per job saved through Japanese tariffs."

[udx]

"The gains from tariff policies are a lot more visible than the losses. You can see the sawmills which would be closed down if the industry is not protected by tariffs. You can meet the workers whose jobs will be lost if tariffs are not enacted by the government. Since the costs of the policies are distributed far and wide, you cannot put a face on the cost of a poor economic policy. Although 8 workers might lose their job for every job saved by a softwood lumber tariff, you will never meet one of these workers, because it is impossible to pinpoint exactly which workers would have been able to keep their jobs if the tariff was not enacted. If a worker loses his job because the performance of the economy is poor, you cannot say if a reduction in lumber tariffs would have saved his job. The nightly news would never show a picture of a California farm worker and state that he lost his job because of tariffs designed to help the lumber industry in Maine. The link between the two is impossible to see. The link between lumber workers and lumber tariffs is much more visible and thus will garner much more attention.

The gains from a tariff are clearly visible but the costs are hidden, it will often appear that tariffs do not have a cost. By understanding this we can understand why so many government policies are enacted which harm the economy."

http://economics.about.com/cs/taxpolicy/a/tariffs_3.htm

Just a few example of how tire tariffs have provided jobs in my area.

Bridgestone plans to expand the plant in order to increase total capacity to 37,750 tires per day or 13.4 million tires annually. The expansion areas are slated to begin production during the second quarter of 2013, and will create more than 300 new full-time and contractor jobs in when fully completed in 2015.

http://www.tirereview.com/Article/97048/bridgestones_aiken_plant_marks_100_million_milestone.aspx

Bridgestone Americas' existing plant expansion and its new 1.5-million-square-foot plant,

http://www.aikenstandard.com/story/021312-economic-dev--3745261

Warren County Tennessee

http://www.truckinginfo.com/news/news-detail.asp?news_id=74785

Anyway, it is my contention that doing this in other industries as well would help us get out of debt. Everyone is free to agree or disagree. God Bless

Like i have said. Tariffs certainly may help few parties, but it hurts the economy as a whole. Economic studies would tell you that it is so.

Existing examples do not support what you are saying. The Caymans have the highest living standard and per capita income in the Caribbean.

AND

There is no income tax, corporate tax, sales tax, capital gains tax, wealth tax, inheritance tax, property tax, gift tax or any other kind of direct taxation in Cayman Islands. This is one of the most significant reasons that Cayman Islands has attracted the registration of many offshore businesses (about 50,000) from all over the world.

An import duty of 5% to 20% is levied against goods imported into the islands. Some items are tax exempt like baby formula, books and cameras. Tax on automobiles depends on the class and make of the model. Tax can reach up to 40% for expensive car models. Financial institutions that operate in the islands are charged a flat licensing fee by the government. A 10% government tax is placed on all tourist accommodations in addition to the small fee each tourist pays upon getting on the Caymans. The Cayman Islands government charges licensing fees to financial institutions that operate in the islands as well as work permit fees for expatriate employees ranging from around US$ 500 for a clerk to around US$ 20,000 for a CEO.http://www.taxrates.cc/html/cayman-islands-tax-rates.html

If you do business in the Caymans, you pay them. They do not subsidize you. A good model for the U.S.

This works for them because they have low taxes to start with. They have light weight government that could live only off tariffs. The tariff is low enough level that is equivalent of import tax in the US. What i am talking about are protective tariffs design to keep import to a country higher than domestic cost to produce them.

This case study does not show how protective tariffs are beneficial. Tariff impose on imports in this case is simply a import tax, which every country has.

Did you know US used to live off of tariffs only also without taxes when the government was very small? US used to be able to live off of import taxes and sell of liquor only until the government grew out of control.

The lesson we could learn from Caymans is that the less government intervention with businesses the better, and more prosperous the people would be.. They are prosperous because the government stay as far away from influencing business decision as possible by having no income, sales taxes.

[udx]

http://www.foxnews.com/us/2012/03/06/congress-approves-punitive-tariffs-against-china/

March 06, 2012

Excerpts....

Congress on Tuesday overturned a court decision and reaffirmed that the government has the right to impose higher tariffs on goods from China and other state-run economies that subsidize their exports to the United States.

The House voted 370-39 to pass the measure .......

"By passing this law, Congress has taken a clear stand against the unfair trade practices that have put countless American jobs in jeopardy," Vice President Joe Biden said in a statement.

The Commerce Department has been applying these "countervailing" duties since 2007. The legislation ensures that 24 existing higher tariff orders and six pending investigations against imports from China and Vietnam will continue to be valid. Of those 24, 23 are directed at Chinese subsidies.

The Ways and Means Committee said the existing tariff orders provide relief for more than 80 American companies in 38 states. One of the larger cases involved Chinese tires: in 2009 the government imposed a three-year tariff, starting at 35 percent, on U.S. imports of low-grade Chinese tires.

The National Association of Manufacturers welcomed the congressional votes on countervailing duties, saying that failure to act "would leave manufacturers in the U.S. defenseless against rampant deep-pocket Chinese and other government subsidies."

Tariffs designed to prevent foreign exports from 'dumping' into the US market is different from Tariff design to allow for less competitive/efficient domestic companies to survive . The reasons you provided for tariffs give indication that you are talking about the latter kind.

[Guest Butero]

I don't have a link to provide, but I would think the best place to start cutting is government agencies. Look how many beurocracies we have, and how many people the government employs. We could save a ton of money by eliminating or drastically cutting agencies. Then we could cut off all foreign aid, except to Israel. When we have a surplus, I have no problem with reaching out to other nations, but we can't borrow to give money away. Repeal Obamacare. That will save billions. We spend way too much on education, not only on the federal level, but on the state level. I would like to see the federal government out of edcuation entirely, and at the state level, I would like to see everyone getting their education on-line. Then we can eliminate all the money spent on school buildings, and school busses. We already have places to attend school over the internet. Why not set up a public system on-line? You would eliminate all that money for teacher salaries as well. My state spends more than half it's budget on education. Drastic cuts there will more than take care of the financial strain. Eliminate all government grants. Sell off a large portion of government land. The federal government has too much property, a lot more than they need. I believe that there are enough cuts to be made in these areas where we could leave Social Security, Medicare and Medicade alone, and keep military spending at current levels.

[udx]

I don't have a link to provide, but I would think the best place to start cutting is government agencies. Look how many beurocracies we have, and how many people the government employs. We could save a ton of money by eliminating or drastically cutting agencies. Then we could cut off all foreign aid, except to Israel. When we have a surplus, I have no problem with reaching out to other nations, but we can't borrow to give money away. Repeal Obamacare. That will save billions. We spend way too much on education, not only on the federal level, but on the state level. I would like to see the federal government out of edcuation entirely, and at the state level, I would like to see everyone getting their education on-line. Then we can eliminate all the money spent on school buildings, and school busses. We already have places to attend school over the internet. Why not set up a public system on-line? You would eliminate all that money for teacher salaries as well. My state spends more than half it's budget on education. Drastic cuts there will more than take care of the financial strain. Eliminate all government grants. Sell off a large portion of government land. The federal government has too much property, a lot more than they need. I believe that there are enough cuts to be made in these areas where we could leave Social Security, Medicare and Medicade alone, and keep military spending at current levels.

I agree with getting rid of government agencies and cutting government worker pay. Government workers get paid on average a lot more than industry for an equivalent job. I disagree that education should be online only. E-learning is not for everyone especially young kids and there are some things that couldn't be replaced online such as lab work and physical education and you still need teacher to teach online as well. There would always be demand for teachers online or not. I do think public education should be privatized so there are more competition in creating the best education experience. How an average citizen could pay for private education would have to be considered though.

Eliminating all government grants would be unwise, as much research is funded with grants. My university professors gets a lot of funding from grants from NASF, DARPA, etc, if funding isn't there... all these researchers would go elsewhere. This would deminish technological lead that US currently enjoys and reduce possibility of the next big innovation that revolutionize the industry would occur in the US.

Cutting off all foreign aid because we are borrowing money for the aid, but still give aide to Israel is contrary to the idea. Either the country gives foreign aide or not at all, with borrowed money. No country should be afforded special treatment.

Everything the government does should be funded on tax dollars only, anything that doesn't fit within the budget should be cut.

[jasoncran]

So what should congress do to balance the budget? Obviously we need to cut spending and while at the same time raise revenue, but what does that look like? Can we tax or way to prosperity?

If you could provide some source links with your responses it would be much appreciated. I think sometimes, regular people can actually arrive at better solutions than the ruling elite of either party.

In the Cayman Islands, none of the citizens pay any taxes. Tax revenue comes from tourism and tarriffs. The standard of living in the Caymans is very high.

To raise money we could place tarriffs on goods coming in from overseas..no matter what the nationality of the exporter is. This tax should be made high enough that it would be cheaper for companies to locate and hire here than to ship it here. This would increase our own tax base by putting our people back to work. Along with cutting wasteful spending this would work to balance the budget. An added bonus would be that the bigger the tax base, the less each individual taxpayer would need to be accountable for.

theres no icome tax in florida so please visit florida as you pay for my benefits