Dispatches, fiction

Dispatches: A New Way to Fight Recession

In light of recent financial news, Steve Finch files an interesting report that he asked us to file under, “I wonder if that would work.”

Chris Phan (flickr)No Sales Tax

WASHINGTON — The Secratery of the Treasury today announced a interesting plan to combat the economic slowdown that has led many to speculate that the country is in the midst of a recession: a sales tax holiday.

The plan, which would require a great deal of legwork to get off the ground, is rather simple: to stimulate spending and recharge the economy the federal government would eliminate all sales taxes across the country for an entire week.

The problem, which critics were quick to point out, is that the federal government has no jurisdiction to lower sales tax rates. Sales tax in the country is controlled by states and municipalities.

To these critics, the secretary was quick to offer this solution: the federal government will reach agreements with all states–who are then responsible for reaching agreements with municipalities–to reimburse them for all income lost during the holiday. Speaking frankly, the secretary said, “We feel this system will be faster and more beneficial than the tradition plan for a tax rebate, which takes a great deal too much time to create and then reward to citizens.

“We must always remember those words repeated to the point of meaninglessness: targeted, temporary and timely. We feel confident that this plan meets all of those criteria better than any alternative.”

Asked about states and municipalities without sales tax, Treasury’s response was that they’d made the decision that making special exceptions for these cases was impractical, and so they would simply maintain the goal of keeping sales taxes at zero for one week across all the states.

Economists’ views on the topic were mixed. Some felt that the plan was innovative and as likely to work as anything else. These “optimists” made the point that all stimulus plans fail, and this one’s failure is likely to as insignificant as all the others.

Others made clear that the plan would be a logistical nightmare. “Not only must the states and municipalities reach hurried agreements with rough projections of earnings for what is meant to be a week of extraordinary spending. But the headache it will be for businesses whose computers are built to assess sales taxes automatically is hard to imagine,” offered Bob Davis with Americans for Simplified Taxation.

As with all such plan, this must be approved by Congress. Both the Speaker of the House and the Senate Majority Leader are hopeful that they will be able to quickly pass the program without much hassle. Speaking frankly, the speaker admitted, “But I don’t know the last time that happened.”

american society, USA, world

“There is almost no problem we can solve all by ourselves”

Source: cursedthingBill Clinton

Former President Bill Clinton was on Charlie Rose last Friday. He said a lot of interesting things, and though they also did a fair bit of rehashing tired arguments about the presidential campaign, it is a pretty good interview to watch.

Without question, the line that most caught my attention was this one: Mr. Clinton said, making what felt like a rather precarious jump, that the American people now know as they never have before that “there is almost no problem we can solve all by ourselves.” That America’s citizenry recognizes that the problems we face as a country: terrorism, nuclear proliferation, climate change, health, and immigration, are all outside of the control of any single government, even the most powerful.

Though Clinton wouldn’t have been a good politician if he regularly denigrated the intelligence of the American people–as I sometimes think is appropriate–I do think he’s overstated the case. One doesn’t have to look very hard in this country to find people as convinced as ever that America has the right to impose its will upon the world. That its policy can and should be to unilaterally do whatever it wants, whenever it judges itself justified.

I have no doubt that those who easily forget that the United States is merely one country in a much larger world is shrinking and continues to shrink. But I find it incredibly hard to accept the argument that the whole populous has come to this revelation.

To be fair, Mr. Clinton is doubly right. More Americans than ever realize that their government doesn’t run the world, and every day a few more do. Further, he’s right in that the world is indeed a less “Amerocentric” place than at any other time since the Second World War.

Certainly, the attacks on September 11, 2001 shook a number of people out of the delusion that they lived in an impenetrable fortress from which they can run roughshod over the whole world and never face any consequences. Unfortunately, from there they went on to allow Mr. Bush to convince them that the wisest course to restore their illusory security was to depose Saddam Hussein–a hideous man no doubt, but hardly a grave threat to American security.

It is in Mr. Bush’s nearly-unilateral, (now known to be) misguided, and poorly executed invasion of Iraq that many Americans realized that they cannot persist as a hegemon. So too has Iran’s nuclear ambitions, Bush’s intransigence on climate change, and the many failed attempts to reform America’s broken immigration laws.

All of this has made clear that Americans do not have sole control over their own destiny. Though I hate the over-simplistic term, “the emergence of China” has clearly changed the world. For one, America’s recent economics hardships have been far more localized than many expected.

There was a time when a devaluation of the American dollar was an absolutely terrifying scenario for world economics, but it hasn’t had the expected debilitating impact. As the world slowly decouples from the formerly-all-important American economy (and thus its government), this country, like Britain before it, will have to recognize that it is not the king of the world.

Love or hate the former President, he is right about that.