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Jewish World Review December 7, 2012/ 23 Kislev, 5773 A simple fact on which every American should meditate By Deroy Murdock http://www.JewishWorldReview.com | Can't we all just get along? This question lately has inspired my friend Tim Browne, a Californian who is active among free-market think tanks. Tim has helped me ponder how both political parties can escape the deteriorating "fiscal cliff" fiasco. Democrats don't want automatic tax increases to hurt the middle class. Republicans don't want tax hikes to prevent the top 2 percent from creating jobs and expanding the economy. Tim suggests: Let's do both! The Republican-led House of Representatives should adopt this proposal and send it to the Democratic-led Senate for its immediate consideration: Cut the 10, 15, 25 and 28 percent tax rates by 10 percent each: to 9, 13.5, 22.5 and 25 percent. Those rates cover single people up to $180,800 and married couples up to $225,550. The two top income-tax rates -- 33 and 35 percent -- would stay the same. So, the GOP would sponsor a middle-class tax cut and leave rates intact for top filers, many of whom own businesses. Deductions would stay untouched, avoiding a Republican-led, back-door tax hike that would siphon the tanks of those who invest in companies, hire workers and purchase products manufactured and marketed by people with more modest incomes. How much would this cost? Experienced Washington budget analysts consulted an economic model popular among Fortune 500 companies. The preliminary estimate is that such a tax cut would cost $332 billion between 2013 and 2022. However, it would trigger dynamic economic activity generating $88.6 billion in federal revenue. This policy's net cost would be $243.4 billion. How would Republicans pay for this? The GOP should finance this reform by welcoming home corporate profits stranded overseas. Even after credit for foreign taxes, CEOs of U.S. multinationals hate paying the balance: up to 35 percent for America's corporate tax. Thus, Bloomberg News estimates that "U.S. companies have more than $1.6 trillion outside the country." Every billion that languishes in Brussels or Bangkok is a billion that is not hiring workers, opening factories, or performing R&D in Buffalo or Birmingham. Bloomberg surveyed 70 top multinationals in March and found that they accumulated $187 billion overseas last year. Extrapolating that through 2022 would add $1.9 trillion to today's $1.6 trillion stockpile. A long-term, 7 percent "welcome home" tax on this $3.5 trillion would finance the GOP's $243 billion middle-class tax cut. This naturalized money would help companies reinvest, increase payrolls or even pay dividends -- all of which would propel economic growth. With this Gordian tax knot elegantly unraveled, Congress and the White House should agree to extend everything else into 2013. This would give both parties breathing room to handle entitlement reform without conducting such heavy maneuvers near a swiftly approaching precipice. If President Barack Obama balks at this GOP-initiated legislation, he can explain to America's middle class why he denied them a tax cut that Republicans authored. Obama once accepted Republican thinking on this subject. As he told NBC on Aug. 5, 2009, "The last thing you want to do is to raise taxes in the middle of a recession." When Obama expressed this economic common sense, America no longer was "in the middle of a recession." While it may feel otherwise, the Great Recession technically ended in the third quarter of 2009. As Obama spoke, output expanded at 1.4 percent. But by that October, GDP advanced at 4 percent. So, if tax hikes were unwise then, they surely are ill advised with GDP growing at just 2.7 percent today. A Republican middle-class tax cut, coupled with importation of marooned corporate profits, recognizes a simple fact on which every American should meditate. A rapidly rising GOP star expressed it beautifully: "The way we're going to move ahead is not by making rich people poorer. It's by making poor people richer," Sen. Marco Rubio, R-Fla., told Bill O'Reilly of Fox News. "The only way forward for us is rapid economic growth. Not new taxes. We need new taxpayers." Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. Comment by clicking here. Deroy Murdock is a columnist with Scripps Howard News Service and a media fellow with the Hoover Institution on War, Revolution and Peace at Stanford University. Previously: • 11/30/12: GOP should hammer Left about racism • 11/21/12: How Squanto became a Thanksgiving symbol • 11/09/12: Obama's re-election bewilders • 11/05/12: Actually, Obama is growing the economy • 10/26/12: Romney's ignored Mitt-zvahs • 10/19/12: Obama's most dangerous disappointment • 10/12/12: About Behghazi, Obama lied, people died --- and few bother to cry (out) • 10/05//12: Obama the exacerbater • 09/28/12: Barack Obama, slacker-in-chief • 09/24/12: Citizens or subjects? Candidates offer choice • 08/17/12: Dems ignore own issues with Medicare • 08/13/12: Speech Romney should give on Bain • 07/20/12: Obama's green projects bleeding red • 07/13/12: EPA, why fine oil firms over fantasy biofuel? • 07/06/12: How about remembering Mexican victims of 'Fast and Furious'? • 06/29/12: Health-care victory will give Obama headaches • 06/22/12: Mitt Romney, get on bus • 06/18/12: The 'racist' Florida vote purge obeys federal law • 06/08/12: Scott Walker's win should propel big reforms, stiffen pols' spines • 06/01/12: Regulators regulate, and that's a problem • 05/25/12: WWII hero Karski to receive U.S. Medal of Freedom • 05/18/12: Not the behavior of normal Americans • 05/18/12: Spacemen to NASA: Cool it on global warming • 05/04/12: Libs want to plunge the penthouse • 04/27/12: Obama and company are pushing hard on the pedal for deadlier cars • 04/20/12: We don't need no stinkin' budget? • 04/14/12: New Reasons to Hate Obamacare • 04/06/12: Team Obama plays energy policy for laughs • 03/30/12: Twitchy Dems need to let workers put tax-cut money in retirement funds • 03/23/12: Why not $100-an-hour minimum wage? • 03/15/12: The real (high) cost of Obama's health care act • 03/09/12: Race-baiting Dems oppose voter ID • 03/02/12: Forget kids --- today's debt hurts adults • 02/24/12: Dems arise against Obamacare • 02/17/12: The voting dead are understated • 02/10/12: Holder takes on 'racist' photo-ID cards: Prejudice is widespread --- even Obama backed them • 02/03/12: On tax plans, Gingrich trumps Romney • 01/27/12: Photo IDs can protect elections, let dead rest • 01/20/12: Romney runs hot and cold on global warming • 01/13/12: Economic freedom declines in U.S. • 01/06/12: Time to yank off Mitt's mask • 12/23/11: Boehner hands Dems a gift • 12/15/11: The U.S. could learn much from Hong Kong • 12/09/11:$687 billion is available to Congress free of strings • 12/02/11: Obama criticizes Wall Street but takes money from it • 11/18/11: Puerto Rico shows Washington the way • 11/11/11: Take heed, America: In Ohio even left-wing unionists voted to repeal ObamaCare • 10/28/11: Thanks, Netanyahu, for surge of hardened terrorists • 10/24/11:The Obama Spend-O-Rama • 10/17/11: Cain stakes his viable claim just by showing up • 10/07/11: Green jobs are national scandal • 10/04/11: Obama proudly declares class war • 09/23/11: Obama wrong about ‘Do-Nothing’ Congress • 09/16/11: Obama needs Ryan's vision on jobs • 09/09/11: Reaganomics trounces Obamanomics • 09/02/11: Labor leaders to Obama: Stop killing jobs • 08/26/11: Pro-market Perry vaults over Romney in GOP race • 08/19/11: Some rich Americans will not rest until Washington boosts their taxes • 08/12/11: Hope, change and free birth control for all • 08/05/11: Debt deal does virtually nothing • 07/21/11: Dems pro-choice on abortion but little else • 07/15/11: Debt deception: If only Dems were honest and GOPers were courageous • 07/08/11: Congress' war on light bulb blows up © 2011, SCRIPPS HOWARD NEWS SERVICE

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