Tax Cut 28, On Trump's planned 15% income tax

These are some news reports and my brief notes last January 11-12, 2017, posted in my fb wall. 

"if the Trump administration follows through on a pledge to cut the corporate income-tax rate from 35 percent to 15 percent, and slash individual rates..." https://www.bloomberg.com/news/articles/2017-01-10/trump-s-tax-cuts-could-jumpstart-global-economy-world-bank-says 

That's huge. Tax competition, not tax harmonization, is the way towards higher global growth.

"The first Trump tax cut will be the repeal of most or even all of the nearly 20 tax increases that funded Obamacare, which total about $1 trillion over the next decade. These are taxes on your health insurance, hospitals (both charitable and for-profit), medical devices, drugs, capital gains, your Health Savings Accounts and Flexible Savings accounts, out-of-pocket medical bills, and even a steep “indoor tanning tax.” https://medium.com/.../the-trump-tax-cuts-will-be-huge...

"The trillion dollars in higher taxes have restricted health care choice, increased costs, made saving more difficult, and granted government more control over care at the expense of individual control. Below are just some of the tax wins that will come from repealing ObamaCare:

1. Individual and Employer Mandate Taxes

2. Taxes on Health Insurance, Prescription Medicine and Medical Devices

3. High Medical Bills Income Tax ... http://www.foxnews.com/.../grover-norquist-why-repeal...

"When I walk down the street, and a mugger ... doesn't take my wallet, he didn't give me my wallet," Norquist analogized. "This idea when the government fails to steal your money ... and tax it, that it gave it to you is nonsense. It's not a gift."

Grover Norquist also highlighted a reduction in the corporate tax rate as a major pillar of GOP tax reform efforts. "We're going to take the corporate rate from 35 percent to either 15 or 20 [percent]. I like 15 better." http://www.cnbc.com/.../heres-why-trump-and-gop-leaders...

"The incoming administration should expand its tax package when it formally takes office. As Ronald Reagan did with his tax reform in 1986, it should reduce the brackets to two: in this case, 25% and 10%; it should also cut the levies on capital gains from 23.8% (this includes a 3.8% ObamaCare add-on) to 15% or less." -- Steve Forbes, http://www.forbes.com/.../why-trumps-tax-cuts-should.../...

"His plan would significantly reducemarginal tax rates onindividuals and businesses, increase standard deduction amountsto nearly four times current levels, and curtail manytax expenditures. His proposal would cut taxes at all income levels, although the largest benefits, in dollar and percentage terms, would go to the highest-income households. The plan would reduce federal revenues by $9.5 trillion over its first decade before accounting for added interest costs or considering macroeconomicfeedbackeffects. The plan would improve incentives to work, save, and invest. However, unless it is accompanied by very large spending cuts, it could increase the national debt by nearly80percent of gross domestic productby 2036, offsettingsome or all of the incentive effects of the tax cuts." -- AN ANALYSIS OF DONALD TRUMP’STAX PLANJim Nunns, Len Burman, Jeff Rohaly, and Joe RosenbergDecember 22, 2015, http://www.taxpolicycenter.org/.../analysis-donald.../full

Now, what if the budget deficit balloons?

Good question. It's tax cut + spending cut. Lots of federal agencies are planned to be starved of excess funding

I think this is part of the "drain the swamp" program. Too many regulations, too many regulators, too many consultants and lobbyists, now they are uneasy or angry. http://www.reuters.com/.../us-usa-congress-regulations...

"an agenda that cuts regulations across a broad swath of critical sectors, enacts tax reform that slashes personal and corporate taxes, and calls for at least $1 trillion in improvements for bridges, roads and other public projects...

In raw numbers, that would push 2017 growth to 2.4 percent and 2018 up to 3.6 percent. By way of comparison, the economy has grown an average of about 1.6 percent a year under President Barack Obama, the worst recovery since the Great Depression. Obama is the first president since Herbert Hoover not to see at least 3 percent growth for a calendar year." http://www.cnbc.com/.../donald-trump-plans-will-double... 

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See also:

Tax Cut 25, Presentation at Ateneo Ignite's Tax Exchange, June 04, 2016 

Tax cut 26, Excise tax on petrol products should be reduced/abolished, not increased, September 12, 2016 
Tax Cut 27, The Furusato tax in Japan as possible model in citizen empowerment, October 14, 2016

Pork Barrel 13: Executive-Legislative Honeymoon and Presidential-Parliamentary Forms

This is my article today in thelobbyist.biz.

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Last Monday, before President Aquino delivered his State of the Nation Address (SONA) 2014, I noted that facebook was peppered with so many anti-government, anti-PNoy posts and complaints. Was it good? Maybe yes, maybe no. But one thing is sure: Government is force and coercion. No matter how much we complain about the government or a particular administration, we are forced, coerced and arm-twisted to contribute to its annual funding via taxes, fees, fines and mandatory social contributions.

Next time, people should NOT support new programs that expand government. Like new tax hikes unless a tax cut somewhere else is made. Like a new subsidy and welfare program unless some existing subsidy programs that do not work are shrank or abolished. Or creating a new agency or bureaucracy unless an existing agency or bureaucracy is drastically shrank or abolished.

Government has three levels -- local, national and multilaterals (UN, WB, IMF, ADB, etc.). All of them share the same characteristics. Generally wasteful, tax-hungry and always saying that "things are bad, we need more taxes and subsidies to solve them." They said that 3 or 5 or more decades ago, they say it today, they will say it 2, 4 or more decades tomorrow.

There is also an observation that Filipinos are “puro angal pero walang aksyon” (all complaints, no action). Right. We should have less government responsibility, more personal and civil society responsibility. Yan ang tunay na "aksyon". But for many activists and "reform-oriented" groups, they want "more/bigger but good government".

I think they are setting the public for more deception and disappointment. When government expands, at least 50-60 percent of the total budget and funding goes to salaries alone. Plus offices and office supplies, electricity and gadgets, vehicles and fuel, travels and trainings, etc. Very little can be expected to go to the supposed beneficiaries, like actual roads. And we are not talking about corruption and robbery yet.

People who are advocating similar campaigns are selling an idea, not individuals or politicians. The idea of less government, more personal and civil society responsibility. If many people will buy that idea, the supply of politicians who will articulate that idea will come in. I doubt though that many people want more personal responsibility. Gusto ng mga tao, painom-inom, pa tambay-tambay, at hingi lahat sa gobyerno. Pag di nabigay or kulang binigay, magagalit, susuporta sa oposisyon, at uulitin panghihingi. Many civil society leaders also support this mentality. That is why they keep lobbying for "more but good government". More government, we got it. Good government, I don't know. When Marcos was kicked out in 1986, or even in several administrations before Marcos was elected in 1965, "good government" has been the battlecry of almost all groups and political parties.

Meanwhile, this news report,  PARA DI NA MAULIT DAP | Speaker seeks creation of oversight committee to examine govt spending, referring to House Speaker Sonny Belmonte is “naku naman.” The whole legislature is created by the Constitution mainly to be the oversight body of the Executive branch. Each Committee and special Committee is supposed to perform oversight function over each Department and bureau in the Executive. To create a separate committee means the other Committees will not do their oversight function seriously?

A lawyer friend, Rey Reyes, shared bright comments. He wrote,

two ideas i wish to share ... first, the inherent powers of the State. With or without legislation, these powers are a given to any State otherwise, it will not function as such. In political theory, they are 3: taxation, police power and eminent domain. Second. In parliamentary systems, the Cabinet is made up of legislators (MPs or Member of Parliament) belonging to one party, the ruling party) The legislative and the executive are merged. In presidential forms, they are separate. Tripartite, which includes the judiciary. Oversight committees are de riguer in presidential forms. In parliamentary forms, government is dissolved and a new one elected. No need for oversight.

Bright contribution, I thanked Rey for it. And I agree, that is why parliamentary governments tend to expand much faster than those in presidential form. The Prime Minister can talk and debate with himself and along with key leaders of the parliament, they can discuss and quickly implement projects, which almost always are about new and expanded welfare/subsidies, and high taxes and huge borrowings to finance these endless subsidies. A really independent Legislative in a Presidential form should result in frequent gridlock between the Legislative and Executive, and this results in slow expansion of government. o minimize or even prevent such gridlock, pork barrel -- hard or soft, explicit or implicit -- is invented by the Executive, essentially a bribe to the Legislature to prevent gridlock and tolerate the wastes and fiscal irresponsibility of the Executive.

Rey added,

In theory, parliamentary forms work well with strong political parties which unfortunately we do not have. Parties with strong ideological underpinnings. We imported American democratic institutions hook line and sinker without the necessary basic fundamentals of party politics. The 1987 Constitution further bastardized the presidential form with the introduction of the European party list again without the basic fundamentals in place. Sad but true. That is the story of our politics in the Philippines over the past decades. Ever wonder why some are advocating for a constitutional convention to change the charter.

Personally, I like the two-party system in the Philippines before, after the adoption of the US-style constitution. The Nacionalista Party means nationalists-protectionists while the Liberal Party means globalists-free traders. Similar to the Democrat-Republican rivalry in the US. Thus, it was an ideology-based political system in the Philippines then, although many Liberals were as populists as the Nacionalistas in getting voters’ support.

I remain agnostic on the Presidential vs. Parliamentary debate. I am only interested in small and limited government, whether it is a Presidential or Parliamentary form.

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See also:

Pork Barrel 9: Are PH Government Institutions Ready for Cleansing?, April 09, 2014

Pork Barrel 10: Bloated Budget, Wasteful Government, June 02, 2014

Pork Barrel 11: Impending Arrest of Sens. Enrile, Estrada and Revilla, June 19, 2014

Pork Barrel 12: Why DAP is Wrong, July 29, 2014

Armageddon, crackpots and governments

Life is colorful, but not necessarily wonderful. And that is how crackpots in both the private and public sectors arise. Some people simply have the talent to paint the most morbid future scenarios, so morbid and graphic that many people and followers believe them. Like the May 21, 2011 apocalypse-armageddon-doomsday-judgment day.

I did not pay attention to it the past few weeks and days. I a blackhole for all those chain emails (send this to XX number of people, you will have luck; ignore this and you will have bad and despicable future), meaning all such mails that enter my inbox do not see any day of resurrection anywhere else. So I can also be a blackhole for such Armageddon scenarios.

The chief architect of the May 21, 2011 hoax is an 89 years old crackpot in the US, Harold Camping. He was somehow successful in fooling several thousands of Americans and other people abroad, that his "predictions" gained traction in various media and social networking outlets.

But he was the first crackpot to make such doomsday scenario. There were many others in the past. And there will be many others in the future. The UN IPCC, FCCC and other governmental and environmental bodies also have the same crackpot predictions of a planet under heavy flooding, but their predictions are still far away, some 90 years from now, by the end of this century.

If crackpots at the UN and many governments can do it, so crackpots in the private sector can successfully emerge too. The key, I think, is the ability to scare the public first, to provide what they call "science-based" doomsday forecasts. Once they have fooled and scared the public enough, then the public are easy prey for what those crackpots would tell them what to do.

There is huge fame, international fame, and huge money too, involved in making such doomsday scenarios. While the crackpots at the UN and many governments are more shrewd, making forecasts on a period where they will be long dead, the private crackpots are less shrewd. They set and predict the date of Armageddon just a few years, even a few months ahead. So they are still alive when their holocaust scenarios are disproven.

So it's the search for international fame, global power and even huge money, that drives those crackpots. Many governments, with UN and other multilaterals' prodding, have succeeded in creating a distorted world and national economies, where a huge army of non-productive, even destructive bureaucrats, armies and monarchies, siphon off so much resources from the productive people. The economic and social distortion, if not destitution that occurred after, is a good environment for such doomsday crackpots to "swim" and fool more people.

It is impossible to stop those crackpots because they just emerge from somewhere and anywhere, from sometime and anytime. People can only protect themselves by relying on their individual capabilities, talents and ambitions. To save oneself from destitution, one must work hard and be responsible always. Religious crackpots and government bureaucrats have nothing to do with delivering us from destitution.