From Forbes, our image of the day captures nicely the mainstream media's credibility problem, as their…
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Image of the Day: Mainstream Media's Evaporating Credibility

From Forbes, our image of the day captures nicely the mainstream media's credibility problem, as their cries of "Wolf!" accumulate.  Simultaneously, it captures how three institutions most intertwined with conservative values - the military, small business and police - remain atop the list of public esteem.

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[caption id="" align="alignleft" width="960"] Media's Evaporating Credibility[/caption]

 

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October 04, 2019 • 10:29 am

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Trump's Tax Proposal: An Excellent Framework Print
By Timothy H. Lee
Wednesday, May 03 2017
Liberals' other reflexive criticism is that we can't cut taxes and risk higher deficits. But America's debt problem didn't germinate due to insufficient taxation, but because of out-of-control spending.

Last November, Americans said they wanted change in Washington.  They also said they wanted to get the economy moving again. 

The bold tax reform outline that President Trump unveiled last week shows that he's doing his part. 

Although important details remain unaddressed and subject to negotiation with Congress, Trump's plan offers a remarkably encouraging pro-growth framework to accelerate our economy, reduce complexity and finally make America much more competitive globally.  It also confirms that Trump seeks to honor the supply-side promises of his campaign, just as Justice Neil Gorsuch's nomination did regarding his judicial promises. 

Accordingly, it's now up to Congress not blow the opportunity that Trump has presented, and for American voters to demand that we finally achieve major tax reform for the first time since Ronald Reagan's presidency. 

So what's in the outline, why's it so significant? 

Most importantly, after eight years of unprecedented national stagnation under Barack Obama, Trump's reform will ignite economic growth.  Never in recorded history had the U.S. gone ten years without once reaching growth of at least 3%, until Obama.  Indeed, the U.S. average since World War II had been 3.3%, but we averaged approximately 1.5% over the past eight years. 

Anyone seeking the source of American malaise should look there first.  Too many businesses stopped investing, and too many people simply started giving up. 

The good news is that we can return to faster growth through tax reform. 

To wit, the U.S. continues to suffer the developed world's highest corporate tax rate at 35%, whereas the developed world average is closer to 25%.  The Trump proposal would slash the rate to 15%, and also significantly simplify the code and close myriad loopholes. 

Here's another extremely important reform.  In addition to imposing the developed world's highest corporate tax rate, the U.S. is also one of the only nations that taxes corporations twice - companies pay the applicable rate in the nations where profits are earned, and then again at the high U.S. rate if companies attempt to bring those earnings home.  The Trump plan would finally restore sanity and common sense by allowing income to be taxed only where it was earned. 

In recent years, many corporations have been driven to relocate their headquarters to more hospitable overseas locales, and jobs along with them.  They've also parked their earnings overseas rather than bring them back to the U.S. to spend, invest and hire because of our punitive code.  This reform would constitute a major step in halting that hemorrhage. 

Speaking of business investment, the Trump framework targets stubbornly weak spending on such things as new machines, technology and factories by incentivizing capital purchases.  Lowering rates and ending double taxation would free up billions for that type of investment, which in turn means more hiring and purchases from other suppliers in the chain.  That also improves productivity due to newer and better facilities, which in turn improves businesses' bottom lines and their employees' compensation. 

In that way, tax reform means a pay raise for working Americans. 

Trump's plan would also allow small businesses currently filing under the individual code to benefit from the new 15% rate as well, thus harmonizing and flattening the business landscape and reducing complexity. 

For individuals, Trump's proposal simplifies our maddeningly complex code by reducing the number of brackets from seven to three - 35%, 25% and 10%, respectively.  Although dishonest class warfare cries of "tax cuts for the rich" are inevitable, the plan doubles the standard deduction to $24,000.  Additionally, families with children could qualify for higher tax credits than under the current code.  That's more money in everyday Americans' pockets, and it also reduces the incentive to itemize, thereby reducing complexity. 

Further targeting complexity, Trump's outline ends the current endless litany of deductions, with the exception of charitable donations and home mortgage interest.  That will elicit howls from deep blue states like California and New York, since it ends the existing deduction for state and local taxes.  But high-tax states shouldn't be rewarded for their poor tax policy choices vis-a-vis more competitive states, and the fact is that approximately 90% of those deductions are currently taken by people earning over $100,000.  So much for liberals' class warfare propaganda. 

Liberals' other reflexive criticism is that we can't cut taxes and risk higher deficits.  But America's debt problem didn't germinate due to insufficient taxation, but because of out-of-control spending.  To illustrate, over just the past six months the federal government collected a new record amount of individual income taxes and payroll taxes.  Unfortunately, spending skyrocketed under Obama, leading to a doubling of the national debt in just eight years.  The way to reduce our deficits and debt is to restrain spending, not take more money from Americans' earnings. 

To be sure, many details remain subject to negotiation and Congressional compromise.  But Trump's plan offers an extremely encouraging outline, one that the final result should broadly reflect. 

But that will take fortitude from Congress, as well as from voters who said they wanted precisely this type of change last November. 

Question of the Week   
Which one of the following is still remembered as the most infamous incident in American industrial history?
More Questions
Quote of the Day   
 
"A motion to censure House Intelligence Committee Chairman Adam Schiff, D-Calif., for his 'parody' reading of President Trump's July phone call with Ukrainian leader Volodymyr Zelensky during a hearing last month is gaining steam with House Republicans, as Fox News has learned 135 lawmakers have now signed on as co-sponsors.The resolution to censure Schiff -- who has become a favorite target of Republicans…[more]
 
 
—Andrew O'Reilly, Fox News
— Andrew O'Reilly, Fox News
 
Liberty Poll   

Do you agree or disagree with President Trump's decision to move American troops from northeast Syria prior to a Turkish military incursion into that region?