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CALLS GROW FOR 15 percent FLAT TAX TO HELP BRING JOBS BACK TO USA
Gary B. Smith: Since 1994, 24 countries have adopted a flat tax. It's interesting-no one has adopted our complicated tax system. That should tell you something. What happens in countries like Russia, for example, tax revenues increased 25 percent the first two years. Granted, that's partly a compliance issue, but that's exactly what we want. We want everyone participating. You can carve out exemptions for people below, or at the poverty level. However, 15 percent across the board has a fairness. 13 countries among those 24 showed a GDP growth of 10 percent. What was our GDP growth last year? Flat. Up maybe 1 percent or 2 percent. Every time we've seen a big GDP growth like that, it leads to increased jobs. I can't see a reason not to do it.
Tobin Smith: It has brought jobs for every country where it has been used. It works for two reasons. Number one, it simplifies things. If you think about the average we spend in the United States, $90 billion every year, to comply with this, it unleashes that. It creates capital. When you create capital, you create investment. Unbeknownst to people in the Democratic Party side, more capital creates more jobs. It's one to one correlated. This is exactly the type of outcome you get with the flat tax. The only people out of jobs are going to be tax attorneys.
Jonas Max Ferris: Conceptually, it would be good to create jobs up to the point where America went bankrupt because they're not taking in enough money with a 15 percent across the board tax rate to pay for all their spending. It's not enough. If we were going to go to a system like that, which I'm not against, it would have to be at least 20 percent, including cap gains, Mitt Romney and Buffet tax rates. That's how we spend money in this country. Unless there were major cuts across the board, far more than anyone has talked about, it's just not financially feasible. When you have different tax rates, you have game play. This income earns this rate, another income earns that rate. Companies change the way they do their balance sheets. All that behavior goes away when every kind of income is taxed the same way. So, there are benefits to it, it's a fantasy to talk about everybody paying this Mitt Romney, Warren Buffet tax rate because that's impossible the way we run our country.
John Tabacco: I think there's some historical success in this and Americans should stand up and cheer the Presidential candidate who says 'I'm going to give you a big, fat, flat tax and I'm going to give you the same tax rate that Mitt Romney has.' People are vilifying Mitt Romney for paying 15 percent on the investments that he's made in the past, but I think Americans should be looking to that. Presidents from Kennedy, to Reagan, to Clinton, to Bush have cut taxes and saw stimulation of employment and lowering of unemployment. One of these candidates should take hold of that.
David Mercer: This is a conceptual framework and those that have embraced it in the past-Phil Graham, who ran for President, or Steve Forbes-we all know where those campaigns went. Romney has said the flat tax would be a tax for the middle class. I'm glad Romney was raised so we can put that point there.
REPORT: CHINESE-BUILT RIG SET TO PUMP OIL 60 MILES FROM FLORIDA COAST
Gary B. Smith: The energy policy of this administration is baffling. The President has said he wants energy independence. He obviously wants higher employment. We obviously have the resources offshore. China is coming in there and drilling on resources we could be taking advantage of where we'd increase employment, lower energy prices and we'd assure in the future a step toward energy independence. It's baffling.
Tobin Smith: If offshore drilling was starting tomorrow at every place we could drill, it would be eight to ten years before that oil would come out. I think the greater point is somehow Cuba has figured out they're sitting in a fabulous oil zone. The United States is right next to it and somehow we have decided that these assets are not valuable. If we were serious about job creation, we would not only be pushing this, but we would be working in Alaska and, of course, we would have a pipeline coming down to move all this oil. We would probably have two to three hundred thousand more jobs. We would have much higher royalties coming to pay off our debt. But, somehow this doesn't get through to them.
Jonas Max Ferris: Whoever thinks that America doesn't go after our energy sources forgets that we basically went through all our energy sources in oil in the lower 48 states a long time ago. In fact, right now we are currently drilling for natural gas to the point where it's at ten-year lows. No one has stopped that. In fact, the President talked about more offshore drilling right before the British Petroleum leak and then he had to change his attitude about it. But, no one in this country stops you from going after energy in land. As far as riskier, offshore stuff, this is Florida as much as it is the Federal Government who don't want the Chinese leaking oil over their $80 billion tourism industry.
John Tabacco: When we have oil within our reach and we're able to get it and we let Cuba claim it and then bring in one of our arch enemies and largest debtors to pump it out for them, the supply that's going into the global supply has a tax on it from both China and Cuba. So, it comes back to us at a higher price. Why would we allow China, our greatest debtor, to set up an offshore post one hundred miles off our shore, pump oil to one of our enemies and then we pay royalties and taxes on it when we should be capturing that and lessening our dependence on enemies like the Middle East and China and Venezuela.
David Mercer: Anybody, whoever it is, who bring more oil resources online increases supply so by virtue of that they're actually helping to lower the prices. The President is looking for a diverse energy policy, which is not to be reliant on just fossil fuels, but on clean energy so that in the future we are in a better position not only for a cleaner environment, but for reduced pricing and for a diversified source giving us independence from the likes of the Middle East.
PRESIDENT SHOWING NO SIGNS OF LETTING UP ON "GREEN PUSH"
Gary B. Smith: 60 years of investing in the energy sector and we have zero results to show for it. It's clear that the Obama administration is certainly no Bane Capital when it comes to venture capital.
Tobin Smith: This is not Ener1-we're at bummer number three here. This is a long list of trying to pick winners and losers. The government doesn't do that well because, frankly, no one in there has been in these businesses. What they're really good at doing is military RND. How about businesses supporting the infrastructure? All those things work, but they have proven they can't do it and there are about six more of these that will blow up in the next year.
Jonas Max Ferris: Many of these companies have venture backing, so it's not just the government. However, you are getting involved in the winners and losers game. We've done that before. We saved the airline industry from not being sued into oblivion after 9/11. So, there's definitely been handouts before. However, in this particular case, this is not an industry we can win from the Chinese. They are, incidentally, giving loans from their state-owned banks to their alternative energy companies. We can't compete on price with them and I don't know why we have to. We don't make iPods here and no one freaks out about that.
John Tabacco: The government, at this point, is starting to act like a taxpayer investment fund where they can go out and there and use taxpayer dollars to invest in companies that suit their political needs. We're finding out time and time again that the investments they're making are going bust. My example is the Chevy Volt where we put out about $3 billion in subsidies and they sold 6,000 cars. That's just another example of where the government is paying about $500,000 per car.
David Mercer: The government has always been a partner in advancing American interests. They did it with tax dollars in rebuilding Europe after World War II. Why? That was to create markets for our automobile industry, which was gaining dominance to sell more cars. We supported the nuclear energy rebuilding here, which led to jobs. The government has always tried to support its corporate and commercial interests. It's doing so with a future and a vision forward on clean energy. As in private business, there are winners and losers. We do that in collaboration with the private sector, not in isolation of them.
Gary B. Smith: Chesapeake Energy Company has a 50 percent profit this year
Tobin Smith: Honda up 20 percent by June
Jonas Max Ferris: Fidelity Export and Multinational has 15 percent gain in one year
John Tabacco: Lululemon up 30 percent in one year