I’ve been thinking about recipes. Actually I’ve been thinking our economic/ financial messes, unemployment, the coming elections, free trade, innovation, taxes, stimuli, and a “new” plan of action. It is time that the United States of America buckled down and seriously got to work. I am not just talking about the loss of jobs. Our government needs to take off the gloves and deliver some one-two punches that will turn things around. We are in the midst of what could become a total global dislocation, that is, if this pending worldwide depression has not already passed the point of no return?
You see we are not looking at a coming second dip in a double dip recession/ depression. We have NOT experienced a turnaround – period! The bulk of businesses, families, and individuals here are hurting. They are hurting badly. Let’s face it the TRILLIONS spent on stimuli thus far have not made it to main street. The bailouts, the MEGA BILLIONS, and the “cures,” have not fixed one thing. Oh, it is true that a very few of the biggest banks and investment houses have received a temporary stay of execution, but just what have all the packages from our elective officials accomplished? The vast bulk of the initial TRILLION dollar “fixes” merely transferred temporary ownership of worth-less and worthless investment paper to be warehoused at the FED until the turnaround comes and the “Wall Street” financial sector buys them back. I seriously doubt such actions are ever going to happen, not in my lifetime, anyway. Their actions thus far have transferred the losses from the balance sheets of the few to the Federal government – meaning to the US taxpayers and generations to come. We are even printing the fresh money to buy our own debt. The US Treasury and the Federal Reserve Bank sectors have only bought some time. The costs of these bandages have been staggering, but nothing has really changed.
With elections roughly six weeks away, we are hearing all about the candidates marvelous plans. We are starting to hear about the real problems (finally). But where are the solutions, I mean where are the nuts and bolts plans to correct the crimes and abuses which got us here? Criminal actions at the highest levels need to be prosecuted. The movers and shakers behind the greed and misdeeds need major penalties. They need to serve hard time in jail. We need to send the word that there will be a cost to such aberrant behavior. There needs to be a stick, but there also needs to be a carrot!
Free trade today is a joke. The USA has become the dumping ground for the world’s production. Hey, Americans will buy anything if it is cheap regardless of the quality. We let hundreds of thousands of products in without restriction or constraint. Meanwhile the rest of the world levies a plethora of limits, requirements, restrictions, and restraints on the goods and services made here. Where is the reciprocity? It is high time the US responded tit for tat. Just TH*NK of what was invented here - the must have/ gotta have “stuff” that the world wants (and maybe even needs). How much of these goods are still made here? You would be surprised by the long list of products that we invented that are no longer manufactured here at all. This situation can (and must) be turned around. This can become our salvation and our carrot. Taxes are now the stick which has forced much of our production overseas. These, too, can be transformed into carrots.
Innovation, product creation, and product development are part of the American tradition, a part of the American adventure, a part of the excitement of America. Use this fact to our benefit. We need killer applications and goods that the WORLD must have and will buy - but buy from the American factories and assembly lines. How do we accomplish this turnaround? Well, TH*NK about it???
Our laws and taxes need to stimulate creativity and keep the jobs created in the making of these new products here. We need a comprehensive overhaul of the oppressive tax laws that are killing US/ us as an economically viable nation. Give immediate (and substantive) tax credits for research and development here. That has worked for US/ us before, but tie these created products to a “made at home” limitation. Get America TH*NK*NG! Get America WORKING! Give US-based (and taxed) corporations a pass on all profits from the goods as far as income taxes are concerned at the Federal AND the State level --- IF AND ONLY IF the goods and products are manufactured here! END the tax freebees to those companies who shift their manufacturing operations abroad. (Example: why is a lion’s share of our pharmaceuticals now manufactured in Puerto Rico?) Making these changes will right our disastrous negative trade imbalances. It will put Americans back to work. We must also enforce intellectual property rights and patents to circumvent “the idea thievery” that has gone on far too long.
When will our government realize (and acknowledge) that we have the solution within our grasp. Require that if you want to sell here, you manufacture here. If you innovate here and make it here, you are tax exempt on the profits from products that meet these criteria. Seriously look at the power of tariffs and exclusions against those nation states which levy their requirements and limitations against our American made products. What is OK for the goose is OK for the gander! It is high time this global one- way street is closed.
I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.
Copyright 2010 Questions, Inc. All rights reserved. Fred Cederholm is a CPA/CFE, a forensic accountant, and writer. He is a graduate of the University of Illinois (B.A., M.A. and M.A.S.). He can be reached at firstname.lastname@example.org.
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This story was published on September 20, 2010.