Give Americans an income tax vacation
Where is Ronald Reagan in today’s GOP? A lot of Republicans evoke Reagan, but none has his courage, boldness or chutzpah. Reagan was a Western gunslinger as well as a politician. He was Sheriff Wyatt Earp daring the bad guys to draw. Reagan was not afraid to ruffle feathers and put dramatic, even radical plans on the table. That is how he created the Reagan Revolution that revitalized America.
Today’s GOP doesn’t have the same zing. It is boring and pedestrian. President Obama wants to raise taxes dramatically. What is the GOP answer? “Let’s keep taxes where they are.” How pathetic is that?
Today’s GOP is filled with funeral directors rearranging deck chairs on the Titanic. In the face of massive deficit and debt, economic collapse, chronic unemployment and a misery index rivaling the Great Depression, the GOP’s answer is to recommend either the status quo or tax and spending cuts so small it takes a microscope to find them.
The boldest plan of the bunch comes from Tim Pawlenty, who has proposed a flat tax that isn’t flat and doesn’t cut taxes. The media calls it “bold.” Do you think “revenue neutral” is bold? Try winning an election with this slogan: “A tax plan that is revenue neutral.”
Here’s the problem: Mr. Obama is a socialist who wants to raise taxes and punish business owners; the alternative is the GOP, which wants to keep things where they are or nibble around the edges, at best. Neither is the right answer. That puts America in a lose-lose scenario.
We need the new vision of a contrarian — a modern-day Reagan with a bold plan. We need a capitalist evangelist who is not afraid to state his goal — to dramatically and radically cut taxes to encourage entrepreneurship and spark an economic boom.
With America facing economic Armageddon, leaving taxes where they are just isn’t enough. “Revenue neutral” is not going to excite anyone, and it’s not going to reverse the economic slide both parties have put us in.
As a true fiscal conservative, a Reagan Libertarian, let me outline a game-changing, conversation-changing tax plan.
Reagan boldly cut top tax rates from the 70 percent range to 28 percent, driving the Reagan Revolution, which created 20 million jobs and turned Jimmy Carter’s bust into a boom, creating the greatest economic expansion in world history. Economic growth filled tax coffers as never before.
The current Obama Great Repression is even worse than the Jimmy Carter malaise. It requires even bolder action. It requires political leaders who are not afraid of their own shadow. I hope the GOP is taking notes. Here is Reagan on steroids: Create a one-year income-tax vacation.
That’s right — an income-tax vacation. For one year, you keep 100 percent of what you earn. Your money belongs to you.
Of course, liberals will scream that Mr. Obama already gave America a giant “tax cut.” But Mr. Obama only rewarded his voters — those who pay little income tax in the first place. That’s not a tax cut, it’s a welfare check. The group he left out just happens to be the economic engine of the U.S. economy — private-sector taxpayers and business owners.
This plan aims the tax cut at the innovators and entrepreneurs. Certainly, Mr. Obama’s socialist cabal will find it audacious to give tax cuts to people who actually pay the taxes. Perhaps that’s why we have 1.9 million fewer Americans working today than when the president’s “stimulus” started. This plan incentivizes the financial risktakers, investors, producers and job creators. This plan doesn’t just refill their fuel tanks — it puts racing fuel into a turbocharger. Stand back and watch the economic explosion when taxpayers and small-business owners capitalize on a once-in-a-lifetime opportunity. They will do what all smart entrepreneurs do with money — spend it, invest it and risk it to start up new businesses or expand old ones.
Mr. Obama and his socialist cabal will scream, “How can we run government without taxes?” That question never bothered him when he spent almost $1 trillion on his stimulus plan. The cost of this plan is about $1.2 trillion — the total revenue from Americans’ annual income taxes. Give or take a few dollars, it’s the same amount Mr. Obama wasted on his stimulus plan to nowhere. The difference is that the president’s trillion dollars created nothing, inspired no one and added $1 trillion in debt for our children to pay.
Desperate times call for outof-the-box thinking. Allowing people to keep 100 percent of their income for one year is the jump-start the economy desperately needs. Simply put, taxpayers will be so excited they will begin an investing spree that will create millions of jobs and ultimately increase tax revenues. If critics are worried about the cost, they should find corresponding spending cuts.
Note to the GOP: That is how you change the conversation. That is how you use boldness and courage to turn a historic bust into a boom. That is how you inspire voters. Reagan gave us the greatest tax cut in history to save us from Mr. Carter. Today we need to cut taxes to zero to save America from Mr. Obama. An income-tax vacation would be the start of a rebellion to save capitalism and take back our country.
I can feel Reagan looking down from above and smiling.
Wayne Allyn Root is the author of “The Conscience of a Libertarian: Empowering the Citizen Revolution With God, Guns, Gold, Gambling & Tax Cuts” (Wiley, 2009).