It seems Romney has similar ideas for a tax relief package as myself. Although, his package is nearly $100 billion more than what President Bush proposes, he writes, ”The cost of a recession to the government is a lot larger than the cost of what I’m talking about.” He’s absolutely right.
Here is an outline of his stimulus package:
1. Allow any business to write off 100 percent of new equipment purchases for the next two years, retroactive to Jan. 1. This totals about $81 billion for 2008.
2. Cut the tax rate on businesses from 35% to 20% over two years, with the first 10-percent cut this year costing $51 billion.
3. Reduce lowest income tax rate from 10 percent to 7.5 percent, which would cost an estimated $28 billion.
4. Institute that rate for 2007 earnings, so that those earning less than $97,500 — the cutoff point for contributing to the Social Security tax fund — would receive a rebate of about $400 when they file tax returns this winter. This is approximately $22 billion for 2008.
In addition, he has already proposed a $32 billion in reduction of taxes on all saving for those individuals making under $200,000 annually.
The total of this is $233 billion or 1.7% of GDP.
Romney addresses both short and long term solutions to the economy in his stimulus package. The $400 rebate will provide a small short term boost, but he realizes the long term importance of capital investment. Because this focuses more on long term, it gives investors in America and abroad the confidence they need in American markets. It is a more stable plan. In addition, liberals like Hillary Clinton cannot argue that he’s leaving out 50 million low income Americans because this rewards all Americans making less than $200,000 annually who wish to save for the future. However, the downside of Romney’s policy is that I worry it would be difficult to get past our Democrat Congress and some of our Republican leaders. It is clearly pro-business, and many of our leaders seem to be anti-business and anti-growth.
Romney is a businessman who has proven that he knows how to manage money and succeed in private enterprises. I have no doubt he would be an asset in Washington and for all Americans.
