An argument for a MASSIVE tax increase

[jmowreader]

Everyone knows Republicans like basing their economic planning around tax cuts. It's time to go the other way--tax increases.

Huge tax increases. As in...oh, how about doubling the current rates?

Allow me to explain.

The American economy only works properly when this cycle is followed:

Step 1: The government buys really expensive things, like moon rockets or interstate freeways, from an American company.
Step 2: The company that wins the contract to supply said things employs and hires Americans, builds or uses factories in America, and purchases American-made parts for the end item the government bought.
Step 2a: The companies the parts are purchased from also employ Americans, work from factories in America and buy American materials.
Step 3: The workers buy American-made things with their money. (The companies that supply those things execute Steps 2 and 2a.)
Step 4: Everyone who touched some of that money pays taxes on it, and the government restarts the cycle when it's got enough money.

I know it works--the longest period of sustained plenty in America was between 1946--the end of World War II--and around 1964--the first year after JFK's death. Taxes were about 93 percent back then...and NO ONE was discouraged from working; more new businesses opened in that era than at any time before or since.

The private sector can't do this. No firm in America can buy 57,000 vehicles on one receipt, but that was the Army's initial order of Humvees.

Breaking away from this time-proven cycle requires the government to borrow money to fund its operations. This has two problems: it cuts down the amount of spending they can do immediately--they can't borrow as heavily as they can tax--and it screws the nation in the long run because servicing the debt becomes prohibitively expensive. (The third problem is that foreign governments like to buy American debt instruments.)

So it's time to return to pay-as-you-go economics.