CEOs asking for Tax Cuts

President Obama and 100 CEOs of top companies in the nation recently had a meeting to discuss methods they could use to create more jobs and get the economy going. In this article, some of the potential ideas brought up in the meeting are shared and analyzed.

The current corporate income tax is at 35%, and the CEOs said that they wish for it to be dropped down to 25%. They also wish for health care taxes and wall street regulations to be completely cut out. They claim that if these demands are made that they will be able to create a large amount of jobs and help out the economy quite a bit. As we discussed is class, there are generally only two things one can do to improve the economy. One is to cut the amount of taxes people must pay and the other to cut government spending. CEOs of the business seem to have already decided which method they wish to use, which is cut there taxes (leakage) and they'll get more work done with the money they get to keep in their pockets/companies. Another tax the CEOs wished to remove was the tax on overseas earnings. As of right now, as long as the earnings are kept overseas the government wont touch it, but as soon as they enter the country they are taxed. The CEOs claimed that if this tax and a few others were excused, that they could get a lot more done, and ultimately bring in more and create many more jobs.

Student Loans

In this article from 2009, the author suggests that the methods being used at the time to stimulate the economy would only be effective in one small section of the class system. The author talks about how the rich generally get richer, and when they get poorer, they get bailed out. This partially makes sense, because with the rich richer, they will have more money to spend to stimulate the economy. But, the problem with this is there are many more of the working class in America than there are rich, and the only way to affectively stimulate the economy is to get them to spend money. The author suggests a way to get the working class spending again is to get ride of their Student Loan debt. He suggests that if that is forgiven, then a huge portion of the population will have more money in their pocket and will have a drastic effect on the economy.

In this article some years later, President Obama has passed a bill that is supposed to help people with student loan debt either get them completely forgiven or lower the payments per month from 15% of the house hold income to 10%. None of the programs will forgive students loans immediately but a majority will forgive after either 20 years or 10 years for a public service worker. The forgiveness plans work differently for different types of jobs and loans, and doesn't apply to everyone with student loan debt. But based on the state of our economy, getting any portion of the population to spend more than usual will have an obvious positive effect on the economy, and hopefully give us that push we need to get into recovery (if we aren't already there).

In this article the author, David Francis, expresses a concern that even though we are likely headed into a recovery, it will likely be what is considered a "jobless recovery". Jobless Recovery basically means that the economy is improving, but there aren't many jobs created/available in the process.

As the economy improves some new jobs will become available but some of the old ones, such as manufacturing jobs, will no longer be available in such large numbers as before. These manufacturing jobs for the most part have been shipped over seas or their pay has been dropped so much that no "American" would be willing to take the pay cut. Francis explains that since many old jobs are disappearing and different ones are being created, the only way to keep up with the growth of the country is education. He explains that people must go back and "retrain" (go to college) so they will have marketable skills that can get them a decent job. The people currently preparing to go into the workforce also need to make sure they equipped them selves with skills that are necessary to get a job in the near future, and hopefully get them by the rest of their lives. Francis also points out that as college become more important, the cost has gone up significantly. So, for those who can't afford the big universities, community college is a decent plan B that can still help these unemployed get back on their feet. Other wise, people will remain unemployed and keep this cycle of recovery from reaching it's full potential.

According this article, the super bowl was bigger than ever. Generally, the Super bowl brings in the most money in a calendar year, but this year it brought in more than money than ever in history. But why?...During Super Bowl the food, beer, and tv sales tend to go up since so many people raid the stores at that time. This year, the same thing happened, but even more people did it!

During black friday and the holiday sales, it was expected that tons of TVS would be sold, so the supply went up. But, the normal demand for TVS just didn't happen, leaving the companies with a surplus of TVS. Because of that, the were forced to drop their prices a big more to get rid of the left overs. When Super Bowl came around, people took notice in TVS again, and a record amount went out and bought new TVS. This is one factor that led to making this Super Bowl the biggest in history.

Oil Demand

In this article, the rapid rise in gas prices is explained. It is believed that sometime during this year, the price of gas will reach atleast $100 a barrel, and $5 a gallon. Main factors that have led to the rising prices include growing/improving economies around the world, and Americas lack of being able to drill.

In Asian countries such as China, major economic growth is taking place, thus causing a substantial increase in the demand for oil. With more people wanting more oil, the price is forced to shoot up because the supply is rapidly decreasing. It is unfortunate, but it seems that as more countries thrive, the worse off the countries that are already established are. If everyone starts demanding as much oil as the US, the world as a whole will be in a VERY bad position. Environmentally and Economically.

Generally, to off set this huge inflation of oil prices, America would just drill for it's own oil. But, because of the disaster in the Gulf, a majority of drill has ceased. Even though companies have been given the ok to start drilling again, because of regulations, the main oil wells of the Gulf are inaccessible, this making drilling in the Gulf nearly pointless at this point. The amount of oil that would come from the Gulf wouldn't even come close to lower our demand for foreign oil.

Welfare

While there a lot of things I don't agree with in this video, there are still a few that do. The video explains that there are people who have learned to milk the welfare system, while they sit at home on their butts doing nothing to change their financial position. Yes, I do agree that reasons like that are why welfare comes off as a complete failure, and the working tax paying Americans feel it should be disposed of completely. But, we must all keep in mind that it's not only the lazy people of our society that are on welfare. There are people who once worked their tails off to make ends meet every month, and could not help losing their jobs, and once the unemployment checks run out they have no other option to take than welfare. So before we sit back and say welfare needs to be disposed of, we need to keep in mind that there are people who honestly need it and aren't sitting around having more and more kids just to collect a check. I feel that we need to find a way to fix the system where it's not as easy for those non deserving people to steal from the rest of the tax paying citizens. How? I don't know, but there has to be a way, and we need to find it soon. Or else our country will continue to be in a bad place, financial wise.

In this video, Homer has one peanut that he considers of great value because it's the last one that remains. But once he drops it and finds the $20 he is faced with a choice. He can get the peanut that he was longing for off of the floor and eat it, or he can use the $20 and go buy a few bags of peanuts. Homer chooses to take the $20 instead, but the opportunity cost is that even though he will get more than one peanut, he will have to wait a few minutes because he has to go all the way to the store, and there is always a chance that the store won't have any.

In this video the theory that "There is no such thing as a free lunch" is proven. Jerry's friend "gives" him a brand new suit and says he wants nothing for it, but then suggests that he is taken out to dinner at a nice restaurant. As a result Jerry has to take the man out to eat twice, and has likely spent a large portion of the cost of the "free" suit, on the man's food. When companies have sales like "buy one get one free" or "buy one get one half off" the consumer is never really getting that great of a deal. Yes, they are paying a few less dollars, but since the prices are already higher than production costs, the companies still receive a profit, and the consumer is still paying more. Thus proving, "There is no such thing as a free lunch".