Writing in the December 1 Huffington Post, Kenneth N. Davis, former US Assistant Secretary of Commerce and IBM CFO proposed an actual solution to our economic problems which would get to the heart of the problem. He wrote:
Legislation For a "Level Playing Field": Effective legislation is the surest way to force action on any big national problem. The best plan developed for fairer competition with foreign importers in our domestic market is draft Senate bill S.3899 "The Balanced Trade Restoration Act of 2006", sponsored by Senators Dorgan and Feingold. It lacked enough support to pass when the economy seemed O.K. in 2006. But now with our jobs and deficit situation so serious, updated legislation could attract wide bipartisan support for fast enactment.
Passing S.3899 is especially important if more stimulus money is spent to foster new "green" industries. There's no avoiding foreign competition. For example, Brazil is already supplying many of the large metal blades used in wind power turbines here. S.3899 will assure a competitive market where US producers can reopen and new companies thrive, with both providing good jobs. It will also cause US companies to reconsider the off-shoring of work to supply the US market. Under S.3899, all items brought in from abroad would have new import costs to enter the US that they won't incur if the work is done here.
Not "Protectionist" or "Anti-Globalization" and is Self-funding: No one should view S.3899 as "protectionist" or "anti-globalization". Instead, it's the fairest way to keep our huge market open to all by "leveling the playing field". No industry or country is targeted or favored in S.3899. All imports having the required import certificates are welcome. Certificates of a value equal to our exports will be issued by the U.S. each year and sold in open trading. It's also important that S.3899 is self-funding. It's the only plan being proposed that won't require more government deficit spending, and it will create many thousands of jobs while reducing our trade deficit and excessive borrowing from abroad.
I can't figure out why nobody is debating the idea of import certificates today. Could you imagine a cain 9-9-9 plan and an import certificate structure? Foreign producers would be opening shops here, having their supply chain add all the "value" on the american side of the border, especially if these foreign corporations only get taxed at 9% in the USA.
ReplyDeleteInstead then importing a widget for 100 dollars from china.
Chinese companies would start importing the same 100 dollar widget for 50 dollars to their american subsidiary, do a minimal final assembly in the USA and then sell the widget for agreed upon 100 to the american company. The big difference... chinese subsidiaries in the USA would pay US taxes, not chinese taxes.