[HT: TaxProf Blog]
I like this idea, I really like it. The gist of it is that rather than having the idiots in Washington decide who to “bail out” and how much of our money to throw at them, including new levels of statist controls on those companies, let the taxpayers handle it directly by stopping income tax for two months, no FICA withholding for two months. This would put at least a couple thousand extra dollars (remember, those are already my dollars) in my pocket.
This means that if you need a new car, spend it on that. If you have credit card debt, spend it on that. If you are behind in your mortgage, spend it on that. It is your money, let’s not forget that key point.
The hardcore (lowercase L) libertarian in me loves this idea. The self-important idiots in Washington will only screw things up with their huge bailouts and I think that we all know that, plus they will add strings to make the bailed-out companies do business in the way that they (the self-important idiots) want. Classic central government control and planning. Anyone who posseses the power of observation knows that central planning always fails when compared to the wonderful anarchy of the free market.
Newt Gingrich has a good column on this concept, put forth by Texas GOP congressman Louie Gohmert. Newt’s point:
For the $350 billion second bailout installment Treasury Secretary Henry Paulson is going to request, every American taxpayer could have a two-month tax holiday from both income tax and the Social Security-Medicare (FICA) tax.
That means that for all of January and all of February you would pay no federal income tax and no FICA tax, which–for most Americans–amounts to about 33 percent of your gross income.
Call your representatives (202-224-3121) and urge them to support this bill. The Democrats will not like it, as it involves economic freedom, which they despise, but like most things they oppose it would be good for us regular folks. We can all predict their response: people who do not pay taxes (40-something percent of Americans) will not get anything out of it. But I think that we all know that when those people get a stimulus-type check the only parts of the economy that get stimulated are beer/liquor/tobacco companies and the state lotteries.
UPDATE: Correction: even the people who do not pay income taxes still pay the FICA Social Security/Medicare tax, so they would get something out of this as well.