Middle Class: Tax Relief and Job Creation

On Tuesday, December 13th, congress will be motioning to pass a new reform bill (most recently titled the “Middle Class Tax Relief and Job Creation Act of 2011”) with hopes to make serious progress on improving the current failing economic policies. This bill intends to create new American jobs, extend the payroll tax break, make reforms to unemployment insurance, and reduce the increase of the federal deficit.

The Perfect Trifecta                                                  

This bill will provide means for the approval of the Keystone XL pipeline project. This pipeline will run from Alberta, Canada to many refineries located in the U.S. By calling for deregulation, this privately run development will create thousands of jobs, add a direct oil supply into the U.S. (thus guaranteeing our country’s energy security), and create revenues for state and federal governments (which can potentially reduce our nation’s enormous deficit.) By accomplishing these three things, one small section of this reform is able to put a dent in cleaning up the mess that years of fiscal irresponsibility is accountable for.

Providing Incentives

This bill will extend the opportunity for corporations to receive tax deductions by purchasing particular capital assets. This motion will provide an incentive for employers to expand their companies by making new investments in capital such as machinery and other equipment. If a rise occurs in nationwide capital purchases, then a rise in demand for workers to operate these new assets will also occur.

Spend Less, Tax Less

Alternatively to imposing tax increases on corporations that are creating jobs, this bill proposes a plan to fully pay for payroll tax relief and unemployment benefits. Spending cuts include; imposing a pay ceiling on federal workers, prohibiting the wealthy from obtaining government benefits, enforcing strict rules to reduce fraud and exploitation of such programs, and reforming entitlement programs to be thrifty and reduce overspending. All of the proposed cuts are projected to eliminate 160 billion just from improving the overall effectiveness of certain government programs.

This bill is mainly Republican endorsed. It calls for a more laissez-faire economic system by decreasing government regulations to help promote job growth. However, this bill includes extensions for federal unemployment benefits. Such a reform would usually be recognized as a liberal standpoint. It appears bipartisan approval exists on a majority of the reforms, yet there are several reforms that lean slightly too far left or too for right for the opposing party’s taste. Regardless, the strongest common ground for this bill is that it provides benefits while using government savings to counteract the expenses of the bill’s proposals.

The significance of this act passing will be that progress has been made towards reaching bi-partisan agreement (at the expense of sacrificing radical political values; all for the sake of bettering our economic and political systems). Hopefully, this bill will be the first step in ending the divergent nature of the two parties. If cohesion between the two parties occurs, congress will eventually allow bills to be passed on much faster timescale, if and only if, time delaying resistance from political opposition is completely eliminated.

What do you think?

There have been many hopeful prospective reform bills, yet the majority of bills are never passed. The few that actually have been passed are quick to become yet another failed economic policy.

Does this act seem to have separated itself from other reforms in the past?

Will bi-partisan divergence ever come to an end? Do you think we will have two completely separated parties before one unified party will exist?

Finally, this bill works in the favor for the middle class. Since most reforms only go towards; tax cuts for the rich, or government handouts for the poor, is it time for the middle class to finally receive a helping hand?



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One Comment on “Middle Class: Tax Relief and Job Creation”

  1. keroboim Says:

    With the American and global economy still recovering, I think this bill like this is needed for society. Based on this post, it seems like this bill will largely stimulate the economy. Also, it does not stimulate the economy by creating jobs and creating an environment that is more business friendly without affecting the least advantaged citizens in a negative way. I believe this bill has made it this far and has gained bi-partisan support because it does not propose cuts on social programs. If it did, I don’t believe many democrats would be in favor. Based on political tradition, I don’t think bipartisan divergence will come to an end. The views of each of these groups differ drastically at both ends of the spectrum. I do believe, however, more people will emerge somewhere in the middle as society continues to evolve.

    In regards to this bill’s benefits to the middle class, I think it is time. With the drastic increase in the income gap over the past decade, if this bill and the proposed benefits are actually realized, it should level the distribution of wealth in society.

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