Every day more and more of Americans are getting laid off and the burden is falling on the Obama Administration to fix the economic problems that was left by the Bush government. The recent stimulus plan that is circulating in the senate and house floors has some good additions. As it stands now, tax cuts account for about $252 billion of its $885 billion total cost, according to an analysis of the Senate bill released by the Congressional Budget Office on Monday.
The plan also comprises of a tax cut for everyone, Of this, $142 billion would go for Obama’s “Making Work Pay” tax credit for individuals. This credit – up to $500 a year for individuals and $1,000 for two-income couples – would fulfill Obama’s campaign pledge of tax relief for low- and middle-income workers. The full amount would be limited to individuals who make $75,000 or less and couples making $150,000 or less. Other individual income-tax provisions contained in the Senate version of the stimulus package include an increase in the earned income-tax credit, estimated to cost $4.7 billion; a $13 billion education tax credit; the first-time home buyer credit, which would cost at least $2.6 billion; and the $70 billion AMT adjustment.
The stimulus package also includes general business tax breaks that would total more than $35 billion.Small businesses would be able to increase the dollar amount of expenses they could write off from $125,000 to $250,000 for 2009 and 2010, for instance. Businesses would have an increased ability to apply recent losses against past and future tax bills.
All these are good news but on the spending side. There are some provisions of tax cuts that will also cost the governement around $70 billion.
The tax cut and spending can and might do good for the economy but the more pressing and long term needs must be accounted for. As an example and for more selling of our goods we should also think about the followings:
1. Open up the Aircraft market specially Boeing for China and Iran to procure. They have recently shown interest to buy American made aircrafts.
2. Bring back the soldiers from Iraq as soon as possible. US can bring at lease 50% now and rest by next year. US is spending arount 20/30 billion dollars each month to support its soldiers and this will free up those money for productive use.
3. Stop issuing new H1 visas for 2 years for that the companies can hire laid off American workers and not mis use the H1 quotas. The H1 quotas can be given to the immigration family category, so that American Citizens can bring relatives fast instead of waiting year after year. Average American have to wait 5/6 years to be united with their sibling family members, which is ridiculous.
4. Give lelalization to millions of illegals who will pour in millions of dollars in the American economy. Study showed the last lagalization by Reagan increased US economic GDP by coulple of points.
5. Stop economic embargo on Cuba. Cuba can be a closer and eager market for American products.
6. Employ Export Import Bank of America agreesively to promote American products abroad specially cotton, wheat and others. There are lots of American products that have prospective markets abroad and we just need to explore them.
There might be other things that can be added to this list. However if we also include these lists to it, I am sure the economy of USA will rebound to a great extend.
