Posts Tagged ‘credit’

t r u t h o u t | Yes, We Can Make the Stimulus More Stimulating

    President Obama could not find any economists who were able to see the housing bubble for his economic team. Fortunately, he indicated that he would be willing to listen to those of us who did in designing his stimulus package.

    In response to his request for ideas on how to make his economic recovery package more effective, I have put together the following list of seven proposals. This is a mix or match list, intended to be added to the list of items already suggested, although given the severity of the downturn, all of them could probably be included without causing concern about excessive deficits.

    1) Extend Health Insurance

    Offer a $2,000 tax credit for any firm that gives health insurance to employees not currently covered. Match at a 70 percent rate any improvements in health care coverage (e.g. lower employee premiums) up to $1,000. If 20 million workers get coverage, this will cost $40 billion a year. If another 50 million workers get added benefits that average $800 per year, this will cost the government another $28 billion for a total cost of $68 billion a year.

    This would be a great first step towards universal coverage. If President Obama also allowed employers and individuals to buy into a Medicare-type public plan, then he will have gone a long way towards reforming the health care system.

    2) Publicly Funded Clinical Trials

    Start a system of publicly funded clinical trials. The point would be to take the conduct of trials out of the control of the drug industry so that doctors and researchers would have immediate and full access to all research findings.

    As a quid pro quo for paying for the trials, the government would get control of the licensing of the patent. The drugs developed through this system would all be sold as generics costing somewhere near $4 apiece at Wal-Mart. The payback from this would be enormous, instead of spending $330 billion a year on prescription drugs in 2012, we might spend closer to $30 billion. We’ll be paying $30 billion a year or so for clinical trials, and maybe close to that much in licensing fees, and getting much better medicine.

    And, as a side benefit, people in developing countries would get cheap drugs too. We could put an end to “free-trade” agreements that try to jack up drug prices in poor countries through stronger patent protections. Total cost: $30 billion a year.

    3) Cash for Clunkers

    Princeton economist Alan Blinder recently argued in the NYT for a program of buying back older, more-polluting cars at a premium over their book value. This would get the most-polluting cars off the road (raising average full efficiency) and put some money into the pockets of the people who own them. Most of these car owners will have low and moderate income, so we will be putting cash into the hands of people who need it and will spend it. Blinder calculated that we get 5 million older cars a year off the road for a cost of less than $20 billion a year.

    4) Subsidies for Public Transportation

    People in the United States take more than 10 billion trips on public transportation each year. This has enormous environmental benefits. Not only are these people consuming much less energy by using public transit, by not driving themselves, they are reducing congestion, and therefore reducing the amount of energy wasted in traffic jams.

    The government can encourage public transit and get money into the pockets of the people who use it (disproportionately low- and moderate-income people), by giving a $1 subsidy for each trip that gets directly passed on in lower fares. For someone taking a subway or bus twice a day, this will amount to savings of $500 a year. The government can include some additional funding to buy more buses and train cars. The cost would be approximately $13 billion a year.

    5) Funding for Writers/Artists/Creative Workers

    In the New Deal there was both a federal arts project and a federal writers project. These programs employed thousands of young artists and writers. A creative stimulus package can extend this idea for the Internet Age. Suppose that President Obama made $10 billion a year available for state and local governments to support various types of creative and artistic work. This could include music, movies, writing books, even journalism. The one condition for support is that all material be made freely available in the public domain. (Better yet, it could have copyleft protection.)

    This funding would be sufficient to employ 200,000 people a year at an average of $50,000 each. This would put an enormous amount of creative work in the public domain that people all over the world could download at zero cost. In the first year or two, we could have this program administered through public agencies, but in later years we can have people choose for themselves which work they want to support through a tax credit. The cost would be approximately $10 billion a year.

    6) Funding for the Development of Open Software

    In the same vein, the government can spend $2 billion a year to develop open source software. This money can be used to further develop and simplify open source operating systems such as Linux, as well other forms of free software. The payoffs from this spending would be enormous. Imagine that every computer buyer in the world would be able to get a computer for which the operating system was free, as was almost all the software that they would ever use.

    This would surely save consumers an average of at least $200 per computer. With sales at close to 20 million a year, the savings in the United States alone could easily exceed the cost of supporting software development. Adding in the benefits (and presumably some contributions) from the rest of the world, we will be way ahead by going the route of publicly funded open software open software. The cost would be $2 billion a year.

    7) Pay for Shorter Workweeks and More Vacations

    The United States lags the rest of world in that its workers are not guaranteed any vacation time, sick leave or family and parental leave. In Europe, five or six weeks a year of paid vacation is standard. Also, all West European countries guarantee their workers some amount of paid sick leave and paid parental leave.

    The stimulus gives us a great chance to catch up with the rest of the world. The government could give make up the pay for two years for any paid cutback in hours, up to 10 percent of total hours worked in a year and $3,000 per worker. This means that if a firm offered workers who previously had no paid vacation, five weeks of vacation a year, the government would provide a tax credit to pick up the tab, up to $3,000 per worker. Similarly, if they extended 10 days of paid sick leave, the government would provide a tax credit for the amount actually used. If employers of 70 million workers (half of the labor force) received an average tax break of $2,500, the cost would be $170 billion a year.

    There are undoubtedly other items that should be added to this list. As President Obama’s chief of staff, Rahm Emanuel, said, we should not allow this crisis to be wasted. We should not be trying to just bring the economy back to where it was before the housing bubble crashed. Rather, we should be looking to create a cleaner, fairer, better country. Not all of it will be accomplished with the initial stimulus package. Not everything will even be accomplished in President Obama’s first term.

    The real question is whether the country can do better than the modest stimulus package that has been laid out thus far. President Obama knows that we can.

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What political catogory do I belong in? Republican? Democrat? Other?

I support unborn rights and would support a pro-life amendment to the constitution, with the only acceptation for the mother’s life.I would abolish the department of education because it’s a local and state level responsibility. I support the right to bear arms, concealed weapons licenses, hunting, stand your ground laws, etc. I support a 2 strikes and your out drunk driving law.I support a his body his choice law banning infant circumcision unless it is to treat a legitimate medical condition.I support the decriminalizing of marijuana because it is less harmful than alcohol. I think the drinking age should be 18 to match the age of adulthood.I think it is of the highest urgency to become and stay energy independent. I support nuclear power and increasing the number of nuclear power plants across America.I would push the auto makers to make electric cars available for drivers who want them.I would set and push for goals of energy independence, curing cancer, and paying down the nation debt.I oppose the endangered species act because it has failed to protect one species and has only given government control of people’s land.I would raise the levels of fines on employers hiring illegal aliens.I don’t believe there is such thing as a gay marriage and think we should give them the same privileges that comes with marriage but call it something else.I think capitalism is the greatest antipoverty tool the world has ever seen and encourage the economy, not put outrageous taxes on it.I don’t believe humans are warming up the Earth but I think we need to clean up some of the messes we are making such as air quality.I believe in a small federal government. I don’t think the general public should even notice the federal government unless they visit their local military recruiter or post office.I support the rights of nudists to live their lifestyle on their privately owned property without the government telling them they must put clothes on. I am a Christian but don’t think it’s the government’s job to push morality, I think morality must come from the people up. Not the government down.I support net neutrality, and oppose bandwidth caps. I would revert our copyright laws back to that of the Webster and Benjamin Franklin years: An item can be copyrighted for 14 years, renewable once, then falls into public domain.I think smokers should be required to pay their own way when they get cancer and heart disease. Not get public money to fight a self imposed condition.I would make it illegal for credit card companies to raise interest rates, at will, with no delinquent activity: banning universal default.I believe terminally ill patients should be allowed to take experimental drugs that have yet to receive FDA approval. I oppose taxes on broadband internet access, sales tax on in items bought online, and regulation of online content. I don’t believe our government is up to the task of providing national heath care and it’s much better off left in the hands of the private sector. I think daylight savings time should be expanded to a year round project.I oppose the government regulating the content of literature, films, video games, etc.So what am I? And how far our my beliefs from yours?