My ideal economic candidate.
Swoon. Here is somebody I would vote for in a heartbeat. If this was on any candidate's policy agenda, I would pledge my undying love to them and birth their children. I cannot explain how close to orgasm I get just thinking about this ever happening. I'm a pretty standard socially liberal person that wants to help everybody and all that touchy-feely crap, but I also think our economic ideas are really messed up.
Get rid of the capital gains tax. Capital is the best way to help workers, and a tax on capital is the most destructive tax that can be placed on the economy. Getting rid of the dividends tax would also be welcomed.
Milder graduation in marginal tax rates, especially the lower levels. Right now the federal income tax brackets are too steep. The brackets that affect most people are $7,000
, $28,400
, and $68,800
. The three lowest rates are 10%, 15%, and 25%, raising the marginal tax burden by 150% over that range. The three highest brackets are 28%, 33%, and 35%, an increase of only 25% over that range. The lowest rungs have their taxes increase far too fast. Cutting Marginal rates are the best way to encourage work. Flat tax credits have no incentive effect and we need to get away from using them to tweak the tax code.
Get rid of the payroll tax. This is the most regressive tax America currently has, and it quite possibly what is preventing the lower classes from building savings. The Earned Income Credit sees the problem that lower income workers are over-taxed, but then tweaks the system instead of fixing it. Marginal income rates should be brought up a few points to make up for this. It's mostly just an accounting trick that the payroll tax actually goes to Social Security. In reality, all Social Security benefits are paid out of the general fund anyways.
Fixing Social Security. If the entire payroll tax isn't removed, something still needs to be fixed. (If the payroll tax is ditched, social security as we know it could be dropped and just made into a welfare program.) The return on investment of social security for many is even below what you can get by just dumping the money yourself in bonds. The forced contribution to such a low return program prevents the poor from retiring with any sort of susbstantial nest egg, making them reliant on the government. A lowest standard should be kept, but that does not prevent somebody from trying to get a better return.
Simplify the tax code. There are too many credits, deductions, exemptions, and other shelters. This allows the largest companies and richest people that can afford to hire entire platoons of tax accountants to hide earnings in all the little crevices of tax code.
Get rid of tariffs and subsidies. Ever since Richardo we've had a formal model of comparative advantage and an explanation of how free trade builds everybody up. Blocking off our steel, lumber, textile, or food markets does nothing but impovrish developing countries, keep cheap good out of our hands, and reduce our economic soft power. If the US were to take the lead by unilaterally opening of our markets, we would be able to apply tremendous pressure on other countries to support things such as intellectual property rights and environmental standards. Farming subsidies benefit the largest producers. They also have the curious effect of raising the price of farming land, hurting farmers that do not own the land they tend. Foreign aid loans should be reduced too. Trade not aid is the way to develop a poor country.
Right to work legislation needs to be passed. Nobody should be forced to join a union. Part of free association is the freedom to not associate. Labor unions have no incentive to work for the workers when everybody is forced to join and pay union fees. Only when enrollment is not guaranteed will unions once again begin to work for those they represent instead of just trying to stay alive for themselves.
Stronger environment regulations with stiffer penalties. I spend much of my summer time rock climbing. This year I was at Creator Lake, Joshua Tree, and Yosemite amoung other small parks. I don't like seeing forests burst into balls of fire or streams drying up, ruining the fly fishing. Presently companies make economic decisions to violate pollution laws because it is cheaper to get caught than to comply. The only way to fix this is to tip the economic scale against them. For the worst polluters who are caught multiple times, a corporate death penalty should be available.
Bilateral negotiation works best. The IMF, World Bank, and WTO have all proven to be ineffective. The IMF promotes poor fiscal and monetary policy in developing countries and we should not be a part in that. The World Bank saddles developing countries with debt. The WTO has turned into a joke, unable to accomplish anything useful. The best way to develop American soft power is by unilateral action and bilateral negotiation.
Maintain a stable unit of account. The economy runs best when a dollar is worth the same this year as it was last year as it will be next year. Inflation and defaltion both warp the economic field. Loands are best paid back without inflation of deflation and the benefit of risk taking and long-term planning is maximized with stable currency. This would also ensure that the dollar keeps its position as the world's reserve currency. The Fed should work to keep the gold/dollar price stable (not a gold standard), buying and selling bonds in open market operations when the price of gold rose or fell.