The Horizon Project

You have probably never heard of the Horizon Project or even Ralph Gomory and William Baumol and their book on Trade and Conflicting Interests..

But, these policy proposals are unique, innovative and deserve strong consideration and discussion.

The Horizon Project's Agenda:

Project members believe we need to act now - on economic & trade policy issues, education, health care and public infrastructure investment - to stave off the rosion of our competitive advantages and the loss of the nation's middle class base

Here is a PDF (large) of the Horizon Project Policy recommendations, from February 2007.

They call it a Marshall Plan. A call to immediately change policy in critical areas.

In their overview statement the concern for the United States economic future is blunt:

Concerns about Trade & Economic Growth mostly manifest themselves in the nation’s record – and still growing – trade deficit, and in the disappearance of valuable chunks of its economy due to offshoring.
Underlying these highly visible phenomena is the growing divergence between the national interests of the United States and the interests of many U.S. multinational corporations which, if given their druthers, seem tempted to off shore almost everything but consumption.

I hope you will read this entire document (linked above). It is clear they view strategic policy direction change holistically, as multi-area focused. That multiple policy areas must be changed to save the US both from a national perspective and a middle class focus. For this post, I want to highly some of the innovative policy proposals contained within.

Trade

  1. Legislate a Trade deficit cap.such as 0/congress/bills/109/s355"> S.355, Foreign Debt Ceiling Act of 2005
  2. Taking actions against unfair trade practices. Listed are unfair trade written into current agreements as well as enforcement.
  3. Reorganize the government’s trade structure to separate trade negotiations from trade agreements enforcement. (This could also isolate trade policy from special interests).
  4. Special deals with individual companies through carefully designed changes in the corporate income tax. Many unique suggestions are detailed in the report with statistical data to justify the proposal.
  5. Government funded redeployment worker agency. The policy details acknowledge:

    • There is no skills or worker shortage in the United States
    • Skills adaptation is a key goal which incorporates the reality Americans are highly skilled and experienced

Education

  1. Eliminate federal income taxation for K-12 teachers in accredited schools (wow!)
  2. Hold teachers accountable for student performance
  3. Significant expansion of government support for high performing students from low- and middle income families.

Health Care

  1. Propose steps to extend basic healthcare coverage, including steps that make it hard to avoid becoming insured and steps that provide tax penalties for being uninsured
  2. Propose capping the healthcare deduction and applying the resultant tax
    savings to expanded coverage for low- and middle-income individuals and families
  3. Reimbursements to Medicare and Medicaid providers for services be based on the extent to which such providers obtain good medical outcomes and adhere to best practices, as measured by shared outcomes data.

Infrastructure

  1. Form a federally sponsored National Investment Corporation to help regions, states and municipalities finance vital
    infrastructure projects that require federal participation in order to be completed
  2. Amend the federal tax code to allow for much-accelerated depreciation of
    investments in the key areas of alternative energy, energy savings, and broadband
    access deployment
  3. Enact measures to encourage timely, universal deployment of the high-speed
    broadband access networks which are vital to the functioning of the nation’s future
    economy and to helping reduce income inequality.

I strongly suggest reading the entire paper. Many of these ideas are aggressive, yet unique and also based on statistical reality, which they note.

I must end this overview with a line from their report which should become a classic:

U.S. multinational corporations which, if given their druthers, seem tempted to offshore almost everything but consumption

Meta: 

Comments

NAFTA is Not the Main Problem

Does it make any sense at all to tax American workers for working, American investors for investing and not tax imports?

NAFTA is Not the Main Problem
Early in our nations history, states were not allowed to place tariffs on goods produced in another state. This was done because it was believed that free trade would benefit the entire country.

Most states then wisely instituted sales taxes and derived income from all things purchased in their state. This way the state gained income from all businesses selling things on their turf. It is somewhat like, if a neighbors cows are going to graze (sell things) on our farm, we should share in in the profits.

It is obvious that all of our income taxes and Social Security taxes paid by workers, investors and corporations have to be embedded in the prices charged for American goods and services making us less competitive. Prices of imported items and out-sourced jobs do not include these taxes. Foreign corporations are doing business and earning money in our country and are contributing little or nothing for the privilege. In a global economy, this is insanity!

Replacing our present national income tax and Social Security taxes with a progressive national sales tax would have many benefits. It would:

Only tax things over the poverty level
Tax imports too, instead of only American labor and investment
Also tax things made with outsourced labor
Lower the cost of hiring American workers
Improve our balance of payments
Get more income from industries that hire few workers
(i.e. Athletics, Rock Stars, Movies, CD’s. TV, drugs, etc.)
Ones that earn huge profits & Pay outlandish salaries
Save Social Security & Medicare
Maybe fund healthcare
Eliminate the IRS - audits, loopholes, forms, time & expenses
Make US a partner of every business selling things in the USA
Get taxes off of the top, not after questionable deductions.

All industries (foreign and domestic) would then start contributing their share of the costs of our infrastructure, from which they benefit when doing business here.

***********************

It is complicated. Supply and Demand determines the price of things.
The cost (price plus tax) of things would stay about the same. On our products the tax would be added at the end instead of being embedded in the price. Importers would have to adjust their prices because customers are apt to buy fewer items when the tax is added. Consumers will think of the total cost when deciding upon a purchase.

Ralph R. Layman Sr.
Heritage511@gmail.com

You must have Javascript enabled to use this form.