Real ideas to give middle class more money and create jobs

[deck77]

Much of the talk in Washington related to helping the economy is focused on either funding of infrastructure from the left or deregulation from the right.  I agree that we need infrastructure improvements, and this will create some jobs, but most people looking for jobs do not have construction experience, so it does not help them. Deregulation is a joke.  That is what caused these problems in the first place.  

What will help to restore our economy is to address specific  issues that would give middle class families more money to pump into our economy and create demand. I would like to see some simple solutions to help accomplish this.  I would offer the following, as a start:

1.  Allow mortgage refinancing of existing mortgage balances, regardless of appraised value.  Too many homeowners looking to refinance and save money by taking advantage of current interest rates are turned away because their homes are no longer worth what they paid for them, by a long shot.  Current policies allow refinancing of up to 125% of appraised value.  Too many families have mortgage balances equal to 130%, 140%, even 150% of appraised values.  If these homeowners were able to refinance, it would free up hundreds of dollars per month, which would then get pumped into the economy.  

 

2. Remove the $2500 tax deduction cap on student loan interest.  The people paying more than this are mostly recent graduates who pay more in interest than principal.  Many recent college graduates are finding no jobs in their chosen fields, and are forced to settle for jobs wherever they can find them.  Alleviating some of the burden by allowing all student loan interest to be tax deductible would give them a few extra dollars come tax time.  These are the people that need help the most! 

 

Please contribute more ideas that Washington can implement now to help get the middle class going again.  The engine of our economy is the collective wallets of the middle class.  That is what will bring back jobs that are sustainable.

[LibertyFirst]

I have said this elsewhere and I will reiterate here.

 

In demanding that the current government create or change policies, you are trusting the foxes to guard the hen house.  You are not dealing with an honest broker.  Our corrupt government and its corporate puppet masters have been enacting legislation for decades that looks like it is going to be good for the people, while in actuality, it benefits only the 1%.  You may get them to reinstate Glass-Steagall, for example, but I guarantee they will create new loopholes and/or other new legislation to ensure the status quo.  There is a reason that legislation is so voluminous and complex you need a law degree and a staff to understand it–this is how they hide the loopholes and they are very good at it.  If the movement's demands end up being a list of policy changes, at some point they will agree to change policy, the movement will rejoice, disban and they will promptly fuck us over anew.

In order to get any real change, we need first to have a legislature we can trust.  This is an enormous challenge and I am not exactly sure how this can be accomplished–maybe we can figure that out together. 

So as not to get caught up in too many details now, run with me for a minute on the big picture.  Let's say we fire the entire congress–like a nationwide recall.  We ensure an honest election system for their replacements, including ensuring their is no corporate, big money or dem/rep influence.  There is an equal playing field for all candidates, etc. and it is clear to them that if they get into office and even talk to a lobbyist, we will yank them back so fast their heads will spin.  If we could make this happen, then we would have an honest legislature whom we could trust to enact the will of the people.  Then we can demand policy change and have a reasonable shot at getting actual reform.

Right now, we are just arguing about which deal to make with the devil.

[Chopin]

Besides the fact that you have voted against close to every measure at general assembly because of this belief and have been pushing your extreme ideal, I move for a compromise:  you actually allow some measures to pass through general assembly or you actually propose something to general assembly to do such a thing.  

[BackSeatEconomist]

On point 2, why not just make all student loan payments tax exempt?  Why just interest?  This would make education more affordable.  Also, it would put more money in the hands of young people who tend to spend it.  One thing the economy is missing right now is more people going out and spending.  That's not going to happen until the current deleveraging (read: paying off debt) cycle completes.  Anything that make it easier to pay off debt will help to reach the end of our current economic problems.

[deck77]

@BackSeatEconomist, I agree that that would be a much better step to get more money in the hands of young people.  I was starting with removing the cap on interest payments, because it would be a good first step, and does not seem to make sense.  We allow for student loan interest to be tax deductible, but set an extremely low cap on it, especially considering the cost of higher education.  Mortgage interest is tax deductible, and student loan interest should be as well.  As a comparison, up to $1,000,000 of mortgage interest is tax deductible.  $2500 is a joke.

[Adam K]

I ask of the extreme, total-revolution abstainers, what is your plan for toppling the mightiest military plutocracy in history? Childish Utopian thinking has never accomplished anything, as suffering and misery are intertwined with the human condition, and cannot be avoided. This repulsive, academic laziness, in hiding behind a dusty, revolutionary repose, serves nobody.

WE WILL NOT SUCCEED IN BUILDING A NEW SOCIETY. Think realistically. We are not gods. We are a necessary shift in momentum. Don't get a big head.

[BackSeatEconomist]

@Deck77 this discussion, I think, really highlights the need to return to demand-side economic policy.  We need to call out the taxes and regulations kill jobs nonsense for what it is.  Although, clearly too much tax or too much regulation is a bad thing, neither is what's preventing hiring now.  Lack of sales is.  If I own a restaurant and the tables are empty, the government can cut my tax rate to zero and I'm not going to hire any more staff.  The only thing that will make me hire more staff is customers at the tables. 

The same is true of the banks.  The banks are in trouble because they have a lot of bad loans.  The loans are bad because people can't afford to pay them.  If there is one thing that would really help the economy right now it would be cutting the payroll tax to zero.  Just eliminate FICA.  Substantial infrastructure spending would help too; in fact I would suggest both.

[occupyguy]

Everybody has valid points here.  As stated in previous posts, I suggest that we evaluate what has worked for us, examine our assets and liabilities, set clear goals, and start playing offense.   My vision involves using the massive labor resources that have been donated to our movement to mine public records and expose fraud in real estate and the financial markets.  

 

Remember these  things; the rich make their money from fraud, deceit, obfuscation, and our inability to connect the dots on a macro level.  What we have is a dedicated work force at our disposal and the technology to connect the dots, untangle their mess and expose their fraud.  Think of this as an interactive version of Wikileaks that uses state of the art business and social media technology to expose fraud.

 

http://occupychi.org/forum/gen.....-movement/