| Tax Rebates Are a Losing Proposition Part 1 (2008-05-12) |
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marotta
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| Tax Rebates Are a Losing Proposition Part 1 (2008-05-12) |
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Tax Rebates Are a Losing Proposition Part 1 (2008-05-12)
by David John Marotta
Beginning this month until July, the government will issue over $100 billion in tax-stimulus checks, the equivalent of about 1% of annual consumer spending and some 70% of the country's $14 trillion gross domestic product (GDP). The assumption is that we can spend our way out of a recession by boosting third-quarter GDP growth over 4%.
Read the complete column at http://www.emarotta.com/article.php?ID=283
David John Marotta
Marotta Asset Management, Inc.
Fee-only Financial Planning
http://www.emarotta.com
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Mon May 12, 2008 2:29 pm |
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Brent Crouch
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I'm not smart enough to have an opinion, but if we really want to stimulate the economy why don't we
1. Lower the top rate for corporations to 25% that meet certain standards for increases in U.S. jobs
2. Lower the top personal tax rate to 25%
3. Double the number of nuclear plants in the U.S. over the next 10 years
4. Start drilling in Alaska this afternoon
5. Give General Electric the thumbs up they need to invest $350 Billion creating 40 coal to gasoline plants that will reduce our oil imports by 30%
6. Scrap the idea of giving the $600 rebates that most will spend at Wal-mart that ultimately goes to China for more cheap merchandise.
Just a start, but I like my ideas better than the rebate checks.....
Investing in Government Secured Tax Lien Certificates | Brent Crouch - My Online Journal
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Thu May 15, 2008 6:03 am |
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coaster
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Sounds like a good plan to me. 
Tim
The Bill Sebastian Forum
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Thu May 15, 2008 1:08 pm |
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Avino
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quote:
Originally posted by Brent Crouch
4. Start drilling in Alaska this afternoon
5. Give General Electric the thumbs up they need to invest $350 Billion creating 40 coal to gasoline plants that will reduce our oil imports by 30%
6. Scrap the idea of giving the $600 rebates that most will spend at Wal-mart that ultimately goes to China for more cheap merchandise.
Just a start, but I like my ideas better than the rebate checks.....
Hi Brent,
I agree with items 1-3, but as 4-5 I do have my own opinions.
(4) Drilling in Alaska isn't going to provide any immediate relief to oil prices, and all it does is put a patch on our real problem: reliance on a limited natural resource.
(5) Pretty much the same as above, there is an abundance of coal, but how clean is this process? I'm not too excited about putting more pollutants in the air than we already do, I have known people in the Northeast who suffer of asthma, but once they go to a less polluted part of the country, they are miracously fine, until they return. Perhaps there is no real link, but for my peace of mind I rather get rid of coal plants not create more.
(6) In a way I agree with you here. My rebate check just simply went to paying my bills and gas, I did no new shopping or investing with it.
As for stimulating the economy, I would like to see more money go into research and development of alternative renewable sources of energy. If our energy prices were less, we would have more money to spend on other things.
One example, we could have taken the $100 Billion and started a program to subsidize homeowners who put solar panels on their properties and then sell this energy back to the grid. We get income for the homeowner, and if enough people do this a cheaper electric bill without having to spend another couple of billion to create a new nuclear plant. I believe they started a program like this in Ontario, Canada, some parts of Germany and maybe a few other places.
~A.
Also blogging @ avinos2cents.blogspot.com
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Thu May 15, 2008 7:51 pm |
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Brent Crouch
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quote:
(4) Drilling in Alaska isn't going to provide any immediate relief to oil prices, and all it does is put a patch on our real problem: reliance on a limited natural resource.
(5) Pretty much the same as above, there is an abundance of coal, but how clean is this process? I'm not too excited about putting more pollutants in the air than we already do, I have known people in the Northeast who suffer of asthma, but once they go to a less polluted part of the country, they are miracously fine, until they return. Perhaps there is no real link, but for my peace of mind I rather get rid of coal plants not create more.
(6) In a way I agree with you here. My rebate check just simply went to paying my bills and gas, I did no new shopping or investing with it.
As for stimulating the economy, I would like to see more money go into research and development of alternative renewable sources of energy. If our energy prices were less, we would have more money to spend on other things.
One example, we could have taken the $100 Billion and started a program to subsidize homeowners who put solar panels on their properties and then sell this energy back to the grid. We get income for the homeowner, and if enough people do this a cheaper electric bill without having to spend another couple of billion to create a new nuclear plant. I believe they started a program like this in Ontario, Canada, some parts of Germany and maybe a few other places.
Hi Avino,
4. Drilling in Alaska will not provide immediate relief, but we would already have that relief in Bill Clinton wouldn't have vetoed a bill that would have allowed it in the 90's. Most estimates say if we start drilling today, we will have oil within 3 years. The U.S. Energy Department estimates we can get 25 million gallons of gas a day from Alaska. This is the equivalent of what we get from Saudi Arabia.
5. I'm not really sure how clean the coal to gas process is. The coal isn't burned it is converted to gasoline. I would think it would be much cleaner than a traditional coal plant.
GE's is one of the largest companies in the world with a market cap of 320 billion. The cost to build 40 of these plants is $350 billion. This is a huge investment for even GE. But could you imagine the benefit to the U.S. economy? Just think of the jobs that would be created. Best of all, we wouldn't be sending so much money to countries that hate us.
If OPEC believed we were serious about this idea, I believe we would see $2 gasoline overnight.
6. I'm all for a clean environment, but I take issue with those that want to impose all the restrictions on U.S. companies and then shop at Wal-mart that sells 99% Chinese products that have NO environmental standards.
I'd love to see new sources of energy that make sense as well. I really thought E85 was a good alternative, but it has had a terrible effect on food prices. Maybe hydrogen? Checkout Youtube and search for salt water fire. Very interesting the method this guy is using to extract hydrogen from water instantly.
Investing in Government Secured Tax Lien Certificates | Brent Crouch - My Online Journal
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Fri May 16, 2008 5:57 am |
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coaster
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I'm really interested in coal gasification. The US is called the "Saudi Arabia" of coal. It's technically a proven and fully-developed method. There's the expense of start-up costs of course. But I think Brent makes a good point that just the knowledge that the US is on a crash course to build these plants would immediately knock the price down a significant amount.
Tim
The Bill Sebastian Forum
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Fri May 16, 2008 1:58 pm |
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Brent Crouch
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Location: Nashville, TN
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David Neeleman, former CEO of Jet Blue, has really been pushing this. A couple of years ago, there was a PDF you could download that outlined his proposal which involved GE.
There is actually a Bill in a House Subcommittee to provide funding for this project. It has been there since sometime in 2006.
http://thomas.loc.gov/cgi-bin/bdquery/z?d109:h.r.06249:
I think the big issue is clear. There are solutions to these gas prices. For some reason, the people we put into power are not pursuing them.
Investing in Government Secured Tax Lien Certificates | Brent Crouch - My Online Journal
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Mon May 19, 2008 3:12 am |
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