Reform Platform for 2016

Premise: The party with the best plan to increase jobs, and reduce inequality and corruption will take the White House in 2016. Vague promises for change will not work. Voters are looking for a Teddy Roosevelt type candidate who separates himself from the pack with bold new plans to reverse America’s downward slide.

Facts: The United States is still the world’s strongest economy, but a majority of voters are angry that their quality of life is deteriorating compared to other developed countries, that 95% of the economy’s gains since the last recession have gone to the top 1%, and that the middle class is growing poorer because of unfair laws and regulations passed by our political representatives who spend 60% of their time seeking money from the rich. Too many (not all) of the rich cheat by hiding assets offshore (46,000 came in under IRS amnesty programs after the UBS Swiss banking revelations), and large corporations are still evading billions in taxes with dodgy offshore schemes. Voters do not want a war against the rich – they want fairness and progress. Here are the numbers:

Corruption: 73% of Americans believe that corruption is widespread in our government, and internationally the US ranks #17 in a 4-way tie with Barbados, Hong Kong and Ireland.[1]

Education: US is #33.[2]

Health: US is #37[3]

Income Inequality: US is #44 of 86 (below every other developed society).[4]

Infrastructure: US is #23. Traffic congestion alone costs the country $121 billion/year and adds 56 billion pounds in CO2 emissions to the atmosphere.[5]

Labor Force Participation Rate: 63.2%; Employment-Population Ratio 58.9 percent. These ratios are the lowest in 35 years, and the problems are worse for young job seekers.[6]

Median Household Income: $51,017 in 2012, down 8.3% from 2007.[7]

Median Net Worth: US is #27 ($45,000; lower than Greece at $54,000).[8]

Solution: Theodore Roosevelt confronted similar problems 125 years ago; his response is just as compelling today as it was then:

 I do not believe that it is wise or safe for us as a party to take refuge in mere negation and just say that there are no evils to be corrected. It seems to me that our attitude should be one of correcting the evils and thereby showing that, whereas the populists, socialist and others really do not correct the evils at all, or else only do so at the expense of producing others in aggravated form, that we Republicans hold the just balance and set our faces as resolutely against improper corporate influence on the one hand as against demagoguery and mob rule on the other. The Republican Party should be beaten and badly beaten, if we took the attitude of saying that corporations should not, when they receive great benefits and make a great deal of money, pay their share of the public burdens.[9]

No matter the party, the TR approach is the only way for politicians in 2016. They are doomed if they try to deny today’s problems or government’s complicity. There may be any number of ways to get the country out of the ditch, but most are too complex to grab the public’s attention. Here is a four-point plan that is easy to explain and more importantly, can put the entire country, both the 99% and the 1%, on a “path for prosperity.”

1. Fix our corrupt system of campaign financing and gerrymandering. It is criminal that we force our legislators into a system where they must spend 60% of their time trying to raise funding from rich contributors. This largess has no other purpose except to bend power for private benefit at the expense of the public good. This would be called bribery under the Foreign Corrupt Practices Act if it happened overseas, and lobbyists could get up to 20 years in jail.

2. Lower the top corporate tax rate from 35% to 21% in exchange for passage of legislation to stop tax haven abuses like the former S. 1533 sponsored by retired Senator Carl Levin. In the past 20 years, tax havens have become the most destructive financial force in history, quietly robbing vast sums from municipalities, small businesses and ordinary taxpayers, while allowing US corporations to stash $2 Trillion offshore awaiting Congress to grant a tax holiday. In 2012, Pfizer, the world’s largest pharmaceutical earned 40% of its profits in the United States, but paid no federal taxes. We need laws to shut down “legalized corruption” like special purpose entities (Enron) and transfer pricing gimmicks(GE, Apple, Starbucks, etc.). Sen. Levin calculated this would generate $220 billion in new tax revenue over 10 years.

3. Americans hate fraud, waste and abuse. Institute concrete management reforms by implementing the 66 reforms recommended by the GAO in its 2015 Annual Report.[10] Examples include: the gap between what taxpayers owe and the amount the government collects reached $450 billion in 2006; every $1 invested in the IRS generates $4 in revenue, and the IRS Commissioner argues that Congressional cuts to IRS enforcement staff amount to “a tax cut for tax cheats”; “improper payment estimates” for entitlement programs like Medicare reached nearly $125 billion in FY 2014; DOD and Veterans Affairs are developing two separate electronic health-records systems, even though they will basically serve the same population; etc.

4. Apply as much as possible of the billions recovered to restore our dilapidated infrastructures, such as water and sanitation systems, roads, transit systems, bridges, harbors and schools. The savings from alleviating traffic congestion alone offset the loss of corporate America’s tax gimmicks. For every one of the hundreds of thousands of blue-collar workers reemployed, 1.3 additional jobs are induced nationwide. The overall result is a significant decrease in unemployment and inequality, and an increase in tax revenues that reduces our national deficit. There is a reason that China is investing billions in its new Asian Infrastructure Investment Bank – it believes that infrastructure is the key to surpassing the U.S. The Reform Platform for 2016 provides immediate relief for Main Street, helps Wall Street by juicing the economy from the bottom up and keeps U.S. competitiveness ahead for generations to come.

[1] http://www.gallup.com/poll/165476/government-corruption-viewed-pervasive-worldwide.aspxhttp://www.transparency.org/cpi2014/results.

[2]http://www.geographic.org/country_ranks/educational_score_performance_country_ranks_2009_oecd.html.

[3] http://www.photius.com/rankings/healthranks.html.

[4] http://www.washingtonpost.com/blogs/worldviews/wp/2013/09/27/map-how-the-worlds-countries-compare-on-income-inequality-the-u-s-ranks-below-nigeria/.

[5] http://www.infrastructurereportcard.org/grades/; http://mobility.tamu.edu/ums/media-information/press-release/.

[6] http://www.bls.gov/news.release/pdf/empsit.pdf;

http://online.wsj.com/news/articles/SB10001424052702303532704579477380159260374.

[7] http://money.cnn.com/2013/09/17/news/economy/poverty-income/.

[8] https://publications.credit-suisse.com/tasks/render/file/?fileID=1949208D-E59A-F2D9-6D0361266E44A2F8.

[9]Goodwin, Doris Kearns, The Bully Pulpit  (Simon & Schuster 2013), p. 248.

[10] http://www.gao.gov/assets/670/669613.pdf