Essay 22- The Middle Class (Part 2)

The evaporation of the middle class has happened over the course of the last 70 years. The exporting of our jobs to cheaper lands of labor, the hollowing out of the dollar with massive deficits and endless spending, and the removal of a meaningful political solution with the installation of the uniparty has left a brutalized landscape more in line with the dystopian futures from literature than the bright promises that seemed inevitable in the early 50's. If the loss of the middle class has been intentional, then the resurrection of it can be fought for. The bright flame of individualism and liberty is a veracious flame that if ignited again, could place this nation again at the center of prosperity and freedom. The solutions won't be easy, but they can be diagnosed and undone with work.

Certainly there could be dramatic sweeping changes that could accomplish a similar outcome - but inevitably would result in violence. I think instead, there are good, tempered solutions that will make America an amazing place again. There needs to be a recognition that the degradation and changes that we are living in did not happen overnight.

They have been a precipitously designed incline, advancing agendas and removing the power of the middle class one small step at a time. The recovery could be faster, but a steady effort at good solutions will bring a bright future for our children and the change of power without violence.

Here are some possible solutions - they are not intended to be comprehensive, nor linear. They may not ultimately be the best solutions once certain data is obtained, but in the current world we find ourselves in, these would be powerful suggestions that would start to move the needle of tyranny in the opposite direction.

1. A home mortgage plan that stabilizes interest rates for first time home buyers. Being in the midst of fluctuating interest rates that are really no fault of the American individual is a difficult world to live in. The spending and borrowing of money results in the raising of interest rates to cure inflation - the true reality is that because of that response to government spending the people just breaking into the housing market are always a day late and a dollar short. They find themselves either on the wrong side of a ultra competitive market filled with cash or one that is unobtainable because of interest rates impact on payments. If there were a way for a permanency in interest rates in the first time home buyer market it would give a competitive edge against a crony system. In an ideal world, the federal reserve would not have the power to establish interest rates, but until they become a less influential organization, the home buyer will be subject to their whims. Some kind of program, either governmental backed bonds or a private donation mechanism should be established to allow for qualifying home buyers to get a competitive edge against a cash transaction. Similarly, sellers should be incentivized to sell to first time home buyers rather than large corporations or investors. If a home seller were to sell to a person that qualified for this program, they should not be taxed on their gains. If they are selling an "income property" to an occupant and removing it from the rental pool, they should be exempt from capital gains without having to put it into the tax deferment menace of a 1031 exchange

2. Legalization of Bitcoin and etherium as legal tender for purchasing and income for stable, decentralized money and secure housing title on the block chain. Bitcoin should be legal to use and pay wages with. If workers had the option to be paid in bitcoin rather than fiat currency, we might see a dramatic rise in adaptation. The current system of conversion from fiat to crypto is arduous and filled with fees. People resist that because they are barely making ends meet currently. If they had the chance to be paid in bitcoin or etherium, they could begin to make their choices with purchases that might be a wealth driven decision.

3. Equalization of imports with use taxes for wage gaps in importing countries. If a company imports from a land with cheap labor, there should be some kind of equalizer. They should be taxed to try to level the playing field. American business is subject to unionized workers, high taxes, fierce regulation and fierce competition from imported goods form places that are one step better than slave labor. That unfair advantage should be burdened upon the company distributing their imports. If that were leveled off, business might again look at re-shoring American jobs. American goods have always been some of the highest quality items on the market, but the disparity in wages and regulation make the goods unaffordable to the average person, regardless of their feelings about it.

4. Eliminate the income tax and replace with a consumption tax. The income tax is punitive to the poor and middle class. The upper class have tax accountants and lawyers that help them find every loophole in the tax code so that they pay the least amount possible. If the income tax were eliminated and everyone had to pay a consumption tax, the entire tax accountant industry would be eliminated. Of course there would be items like clothes, food and transportation that would be excluded from this consumption model, but everything else would be taxed based upon your consumption. The more you traveled or bought luxury goods, the more you would pay in taxes.

5. Incentivize community business with streamlined entitlement processes for expansion and sales tax equalization for delivery. The federal government has a very heavy say in localized affairs because of the tie between Washington money and local government. The dirty secret is that over the years, the federal government has required that any advancements in a community for infrastructure, education, or energy, was to be first pushed through the federal government for funding. Nixon required this movement in the 70's and the results are pathetic. Most communities would prefer to solve their own issues, but because the federal government provides this circular opportunity at funding, the local areas rely heavily on them for their issues. This has massive impact on small business. When towns are beholden to the federal government and their rules, the bureaucracy stagnates the progress and slows growth to a halt. Localized, small business bears the brunt of this burden.

6. Eliminate all government subsidies for energy so that new advancements can be made in the market. Currently our energy policy is subsidized beyond recognition. There is no free market for these items. Ethanol, solar, wind, oil and gas, all receive some compensation through tax breaks or subsides so that no clear picture can ever be ascertained as to what the real market might be. If everything is subsidized than there is no chance at ever getting to true innovation or environmental choices. We will forever be subjected to Washington's whims on what is most influential on their next re-election. Make Washington a subsidy free arena where no one gets any leg up. The results will be market driven and in the hands of the consumer once again.

7. Reduction of bureaucracy by 50% - capping government employees to 5% of the total workforce. We are over staffed and bloated. There is no need for government to be the size it is, particularly within the  bureaucratic realm. The payment of this behemoth institution causes a drag on the economy and an ever present reliance upon deficit spending. The federal government should be able to do its job with a workforce no larger than 5% and that workforce should be paid no greater than the average salary for the American worker. Working in government should not make you wealthy. Secondly to that, all jobs in Washington should have a limitation on time. No one should work for the federal government longer than 10 years. Anything longer, they will lose touch with their communities back home and spend their energies on self preserving their positions. Working for the federal government should be a sacrifice of service, not a pathway to perpetual wealth and comfort.

8. Balanced budget amendment - the people of this country should demand that the government balance its budget every year regardless of circumstance. If they dont have money to pay for their wish list, they should not be able to spend beyond their means. Of course there can be limited exceptions, including an invasion, or a war on American soil, but all other wars, military spending, social programs, healthcare amongst others, needs to be paid for with the revenue that the government is allowed by the consumption tax and tariffs. Everything else should not be allowable. If the amendment is broken, all congressional offices should be automatically term limited to the next November and their positions should not be renewed.

9. Phase out the federal reserve by creating gold/silver/ bitcoin backed Treasuries. The money we have is worthless. If the federal government encouraged the purchasing of Treasuries by the people of the country or business that were backed by stable money, gold, sliver, bitcoin, etc. then the people could decide what kind of currency they actually believe in. Once that started to move that way, it would be easy to eliminate the shadowy world of the federal reserve and get an honest, stable currency back in the hands of the people. The federal reserve has decimated the value of the money - make the market decide what kind of currency they want and what will ultimately be most desirable.  The elimination of the fiat system would happen rather quickly.

10. Term limits. All elected representative officials AND all bureaucratic offices should be term limited to no more than 10 years in Washington.  Senators should be limited to 2 terms of 6 years for a total of 12 years of service. Anything beyond that will not enable the people to have connection with their representatives. People should be willing to serve their constituents, not be interested in their longevity. The argument is always posited that Washington works because of tenure. That argument is always made by the those that have a lot to lose. In the mean time, the American people have been beaten up and abused by a system that is entrenched and lightly subjected to election cycles. If people knew that they only had a maximum number of years allowed to serve, they might actually be less averse to risk and more open about their hopes for their districts and people.

None of this is easy, and any one of these choices would take a dramatic shift in thinking about how government works.

In the end, without these kinds of choice, the middle class will cease to exist and their control over their own human capital will be at the whim of the more powerful and elite. We can make these harder choices with the hope that the future is one where the middle class has been restored to its rightful station in society, and the country is a healthy, aspiration filled land where the people are back in control.