Flake's Banking Crisis Bailout Alternative: Capital-Gains Tax Holiday

businessandmedia.org ^ | September 24, 2008 | Jeff Poor

[Rufus2007]

Now that Congress has a proposal before them to bail out beleaguered investment banks in the wake of the subprime mortgage fallout, there is one way to pump liquidity into the markets almost no one is talking about – cutting the financial obligations of these troubled firms by cutting taxes.

That was one proposition Rep. Jeff Flake, R-Ariz., suggested when he spoke to conservative bloggers at the Heritage Foundation in Washington, D.C. on Sept. 23. He was promoting his new grassroots activism Web site PorkParade.com.

But even Flake, a staunch earmark reform crusader, admitted that issue is trivial compared to the current debate going in the U.S. Senate about whether or not to give the Treasury Department the authority to bail out the financial industry to the tune of $700 billion.

...more (w/video)...

[Rufus2007]

Tax cutting sounds like a sound means as opposed to writing a series of checks.

[what's up]

Tax cutting is great.

But do you think the Dems are going to cooperate? Really?

[edpc]

Flake's Banking Crisis Bailout Alternative: Capital-Gains Tax Holiday

Based on the first word of the headline, I this was an Obama plan.

[ari-freedom]

what it does is make all the money that’s out there more useful.

[edpc]

I this = I thought this

[ari-freedom]

do the dems really want to go behind a very unpopular bailout?

[Rufus2007]

It’s just an idea.

Of course they won’t cooperate.

[unixfox]

wow

[RayChuang88]

Or better yet, dump the entire current income tax system and replace it with the consumption-based FairTax system, where everybody gets to keep their entire paycheck or dividend payment check.

[refermech]

Seems like there won’t be any capital gains this year anyway so it’s a moot point.

[what's up]

Of course they won’t cooperate.

Exactly. So I don't know why I keep seeing this as some kind of viable alternative.

Something has to be done immediately before the money markets go under.

[Oldexpat]

Reform of our capital gains tax and corporate tax rates would help to support US business. Right now there are all kinds of advantages to multi-national companies to be non-US companies. So we will see a lot of take overs of US companies..large and small. The result will be to reduce the amount of corporate tax paid in the US.

[RayChuang88]

The switch to FairTax means that even foreign companies would find it advantageous to build products in the USA. Suddenly, building even economy cars make sense in the USA, and that could be the incentive for even Ford and GM to build the Ford Fiesta and the next-generation Opel/Vauxhall Corsa at a US assembly line, and Mercedes-Benz might even build the next-generation B-class hatchback at its Alabama assembly line!

[Rufus2007]

It’s all how you frame the debate. It deserves mentioning.

[what's up]

It deserves mentioning in the context of longer term tax reform. It may have a good hearing in a McCain Presidency.

But as far as happening in time to help the current crisis it's useless, especially with the Dems in charge.

[HighlyOpinionated]

I joined up. I like Dave Ramsey's Plan the best and am promoting it. But what do I know, I only took Micro and Macro Economics and I'm now retired.

I'm an opinionated DixieCrat and I approve of this message.