The Candidates 2016 and the Economy
When it comes to economics, my bias lies in the free market. I'm a believer in people, not central planning, a guy more likely to be found reading Thomas Sowell than Paul Krugman. The push to regulate all aspects of life in an effort to make things "fair" is often misguided and counter-productive, and if there's one thing the Twentieth Century should have taught us, it's that capitalism, free trade, and Adam Smith's Invisible Hand lead to greater prosperity for everyone than socialized central planning, big government, and bureaucracy. Of course, business and politics are much too intertwined these days, but rather than complain about the undue influence of the one percenters and lobbyists, I complain about how much influence the government has on them. If it weren't for government meddling in the market through tax subsidies, mind-numbingly complicated regulatory structures, and the unintended consequences of attempts to control the economy, businesses would have no incentive to get in bed with our politicians. Rather than spending so much money convincing a Senate subcommittee to vote for a tax increase on its competition, a big business would instead spend its money on its own profit motive, improving itself and the quality of whatever good or service it provides in order to compete on level ground. My prefered candidate must be an advocate for free market economics, smaller government, and less intervention between businesses and their customers. This country would flourish under a greatly simplified tax code, more open trade, and fewer regulation-created monopolies. Jobs, cheap energy, and wealth would inevitably follow.
For much too long, the government has tried to control industries it likes with tax subsidies, influence foreign nations with tariffs and sanctions, punish those it doesn't like with increased tax enforcement, and rely on a tax code so enormous, contradictory, and bloated that it can be bent to the will of whomever is in power without anyone else being able to protest it. As such, I absolutely support fewer taxes, a much, much simpler tax code almost anyone can understand, and doing away with all subsidies, tariffs, and sanctions. These anchors are weighing down our economy and hurting those they purport to help, and it's time to cut them loose.
Hillary Clinton wants to implement the Buffett Rule, which would raise taxes for the wealthiest Americans to at least 30% of their income, to force them to "pay their fair share." She also wants to close tax loopholes, end the practice of "inversion," and offer tax relief to businesses that stay in the country. She also wants to cut taxes for small businesses and working-class families, but wants to spend tax money on "ambitious, progressive investments in good-paying jobs, debt-free college, and other measures to strengthen growth, broaden opportunity, and reduce inequality."
Favoring a simpler tax code, Gary Johnson wants to eliminate all federal income and payroll tax schemes, replacing them with a universal sales tax, thereby ensuring that people are equally and fairly taxed according to how much they spend rather than how much they make. He also calls for the "elimination of special interest tax loopholes," and stopping the practice of double-taxing small businesses.
Jill Stein also wants to "close tax loopholes" and cut taxes on small businesses by 50%. She champions a heavily progressive tax structure, arguing that sales tax unfairly targets lower-income Americans. She wants to increase estate taxes (which she would call the "Aristocracy Tax"), and drastically increase taxes on capital gains.
On the other hand, Donald Trump has called for decreased taxes across the board. He wants to simplify the tax code by having only three tax brackets instead of seven and, of course, by closing corporate loopholes. He also talks about the need to end inversions. However, he supports extremely high tariffs to restrict free trade, which he calls "a bad deal" that sends jobs overseas. He also wants to raise the import taxes from Mexico, along with weilding new and inventive tariff policies against other nations like China and Japan.
All four of these candidates talk about simplifying the tax code, but three out of four of them are still talking about how they'd make taxes different for different groups in order to influence the economy. Hillary Clinton wants to implement the Buffett Rule, which would do severe damage to actual investment in the country, and I am highly skeptical of her "ambitious, progressive" spending plans. Jill Stein is pure class warfare and progressivism, and as such, her definition of "fair" is very different from mine and her explicit desire to raise capital gains taxes to extreme degrees is akin to declaring war on economic prosperity. Then there's Trump, who talks about simplifying the tax code out of one side of his mouth while promising a multitude of economically ruinous tariffs out of the other. I think it's time to go back to square one, to treat people with fairness (meaning they are treated equally, no matter their income) under a tax code so simple it fits on one sheet of paper, and as such, the only candidate I can support on the issue is Gary Johnson.
Federal Minimum Wage
At the federal level, the law requires employees around the country (not including "tipped" employment and several union exemptions) to be paid a minimum of $7.25 an hour, although many states have a higher minimum requirement. Basic, simple economics of supply and demand dictate that, if an employer has to pay more, he or she is likely to hire less, and the controversy around whether minimum wage increases raise unemployment rages on in academic and political circles. I tend to think the whole thing is a pandering smoke screen designed to garner votes rather than a legitimate economic policy designed to improve the country, and my reading of the evidence suggests that higher minimum wages makes it much harder for young people and the disadvantaged to find a job, as employers tend to get pickier about their choices when forced to pay more for them. As with any other form of price control, it is counter-productive and hurts those it purports to help. Having said that, I'm willing to compromise, as most people want the minimum wage around and higher, even though such a change would only affect a very small percentage of the population. Where I don't see the purpose of it, though, is at the federal level. We should let states and cities decide whether or not to raise their minimum wages--as they are doing--and then we'll have more data to parse and argue about. If higher minimum wages lead to better economic conditions, competition will spark change, and the federal government need not step in at any point.
|Cheaper than $15 an hour|
Hillary Clinton has long been a supporter of higher minimum wages, and is calling for a federal increase to $12 an hour. She insists that minimum wage should be a "living wage," and that companies should be punished for "taking advantage" of workers.
Gary Johnson does not believe there should be any federal wage standards. He opposes the very idea of minimum wage on principle, arguing that it is an unnecessary intrusion into free market contracts between employers and employees.
Adding to the list of things she'd like to declare a basic human right, Jill Stein would have living-wage jobs accessable "for every American who needs work." Though she hasn't gotten too specific, the Green Party Platform indicates that the federal minimum wage should be "at least $15 an hour" and indexed to inflation.
Despite early indications during the campaign that he would not support an increase in the federal minimum wage, Donald Trump has since demanded a $10 federal minimum wage.
If we're talking ideologically, I agree entirely with Gary Johnson's take on the issue, and would happily vote for him if this were the only issue. I'm giving him a point, but I worry about his unwillingness to compromise, given how deeply a large segment of the American public have dug their heels on it. The only person who seems willing to compromise, though, is Donald Trump, whose statements--just in the last couple of months--have been contradictory and confusing. First, he acknowledges the damage a wage increase would cause, but then he says we need a wage increase. Which is it, man? Clinton's plan is too dramatic (and rapid), but at least it approaches some semblence of reality when compared to Jill Stein, who seems to think she can magically give everyone a $15 an hour job just because she has declared it a basic human right. Both make a critical mistake, however, in conflating "minimum wage" with "living wage." They are not the same thing, nor should they be.
-e. magill 9/8/2016