Over the course of nearly a half-century following World War II, America built and enjoyed the most prosperous economy in the history of the world. Rising incomes, low unemployment, and steady long-term growth were hallmarks of this extraordinary period. On a personal level, we all felt that America was a land of limitless opportunity — where some talent, a solid idea and a lot of hard work would pay off with a good and maybe even great quality of life.
Over the last few years, however, something has changed. Today many Americans live paralyzed in fear of losing their jobs and not being able to make ends meet. Experts now tell us to expect high unemployment and a slow-growth economy for years to come. Worse still, Americans are not optimistic that things will get better; a recent Gallup poll found that only 54% of Americans believe that today’s youth will have a better life than their parents — the lowest number since 1983. They are justified in this belief — projections from the Free Congress Foundation indicate that a family of four under the new economic reality will earn nearly $100,000 less over a period of 15 years than they could have expected to earn a few years ago (please see the chart below).
Clear and decisive pro-growth policies are the solution to our economic challenges — not new taxes or tax increases, not class warfare, not punishing the small businesses that serve as the economic backbone of our country, and not betraying promises made to America’s seniors by changing Social Security or Medicare for those at or near retirement age. The Growth Code, at its core, argues that we do not need to accept a dim and stagnant economic future as our destiny. Our country can grow again and thrive again and revitalize the economic engine that was once the envy of the world and the thrust of the American dream.
THE GROWTH CODE
Made up of five steps, The Growth Code is simply, squarely and precisely focused on the tax code and restoring America to a sustainable economic growth trajectory:
- A simple unified 15% rate on all business income, regardless of the type of entity;
- Tax rates of 10%, 15% and 25% on individual income as currently defined under the IRC;
- Immediate expensing of capital equipment;
- Elimination of the abhorrent practice of double taxation;
- Any household living in poverty will receive a family tax credit of $4,300.
What will these steps mean to people, businesses, and the economy? Under The Growth Code:
- Small businesses will no longer be taxed as individuals. Instead, they will be taxed as entities and pay no more than 15% of their revenue in taxes. All businesses will pay the same rate.
- Tax brackets will be lowered and dramatically simplified for individuals across the board, including the middle class.
- Profits made abroad will no longer be taxed when brought home for reinvestment. This will bring an explosion of capital investment in America.
- Taxes on dividends, distributions, and capital gains will be eliminated.
- Every American will pay taxes. Americans living in poverty will pay less.
- The mortgage deduction and charitable giving deduction will be protected.
- American companies will finally be able to compete on a level playing field against our biggest competitors, such as Japan, China and the largest economies in Europe.
Independent economic modeling studies by former Treasury Department officials have projected that enactment of The Growth Code will lead to:
- A dramatic drop in the unemployment rate from 9.1% to 4.7%;
- A 14.5% increase in GDP;
- A 14.8% increase in federal tax receipts;
- A 35.3% boost in capital investment.
Americans have always looked at our country as the “city upon a hill” from the time of the Puritans to John F. Kennedy to Ronald Reagan. The Growth Code is our way back to economic prosperity so we can all again see a brighter future where the American Dream is secure and thriving.
We invite all of our friends to read “The Growth Code” proposal in full here