Changes to our tax code and what we spend on entitlements like Medicare, Medicaid, and Social Security are necessary to set the table for long-term economic growth.
Our tax code is unbelievably restrictive to entrepreneurs. If you want to start a business, you face an avalanche of paperwork in your tax return.
In addition, we need to eliminate markups in our tax code that give special treatment to large companies, often at the expense of small entrepreneurs.
We need a tax code that’s clear, understandable, and reasonable. Here’s my idea. It’s the 15-25-0 plan:
- The first so many dollars of income you earn would be taxed at 15% (or 10%) — the exact number would depend on economists doing math to see which rate would generate enough tax to be neutral with our tax levels today.
- If you are a big income earner, your income will be taxed at 25% after a certain point.
- There would be no corporate tax at all.
- No deductions, no credits, no exemptions. Not for mortgage interest, not for donating to charity — nothing. Just a plain, simple tax.
After we get the tax code revised, then we’ve got to do something about spending in America. We have to attack how we provide healthcare to seniors and the poor. Congressman Paul Ryan was courageous in the past in co-leading a bipartisan effort of two to have a realistic conversation about how to reduce the obligations of the federal government for healthcare.
Next we have to balance the budget. As longtime listeners know, I have always been obsessed about government, individuals, and businesses having their books in balance. I’m a believer in a federal balanced budget amendment with real teeth, where the feds would be required to keep a balanced budget, barring an outbreak of war.
Then, finally our nation’s spending priorities need to be established. If you just let Medicare and Medicaid run as they are currently, the numbers won’t work.