I’d suggest the following:
1) Simplify the tax code by eliminating all corporate taxes. With this change go all the special tax credits and other hidden subsidies that distort the economy. The tax code will no longer distort the allocation of capital in the US. For those US businesses that pay the full corporate rate tax rate, their “profits” now increase by over 30% and they have more to invest in the US.
2) Sensible regulation. History has shown the invisible hand will not necessarily protect the health and safety of workers or consumers. Witness Mattel importing lead contaminated toys from China — clearly the company is avoiding the cost of inspection to maximize “profit”. Given the long history of business failing to self police, government inspection is needed to ensure safety of workers and consumers. The way to make the government inspection neutral as far as capital allocation is concerned is to provide the same level of product inspection to both domestic production and imports. Plus, the cost of regulation should be charge on a per unit basis equally to domestically produced products and imports. Instead of all taxpayers subsidizing the cost of inspection, the cost is allocated to the product and the consumers of product pay the regulatory cost.
3) In the same way, allocate the cost the state bears for imports to the unit cost of imported products. Institute a per container charge to cover the cost to the government of the customs service, Coast Guard, and other taxpayer subsidies of imports such as the Army Corps of Engineers dredging of harbors and channels and agricultural inspections. Again, why should the taxpayer subsidize the cost of imports by paying for the infrastructure?
4) End local government subsidies for business. Property tax abatements and worker training incentives distort the efficient allocation of capital.
5) Through fuel tax increases or licensing fees, charge the trucking industry for the real cost of building and maintaining the taxpayer financed road and highway system that it uses. Tolls might be more efficient than licensing fees to ensure the government is not subsidizing truck transportation of goods while railroads are forced to fully fund and maintain the rail lines. In the same way, the full cost of building and maintaining airports as well as the cost of operating the air traffic control, TSA and the FAA should be funded through user fees, not the general revenue.
6) Shift from income to consumption taxes to fund the federal government.
I have mixed feelings about tariffs. During the latter half of the 19th century, the US government was primarily financed through tariffs, not income taxes. This was a period of tremendous economic growth for the economy. Perhaps user fees and inspection fees levied on importers to cover the true economic cost of imported goods on the publicly financed infrastructure are more appropriate in the 21st Century and would contribute to economic neutrality.
One of the key issues in the US regarding the allocation of capital is the short investment horizon. Manufacturing plants are productive assets with 20+ year lives. Wall Street is fixated on 3 month financial performance not 20+ year. In the era of Carneige, Rockefeller, Ford, and Edison when the industrial backbone of our capitalist economy was developed, Wall Street gladly funded the long term investments required to build the economy. Today, these long term investments are being made in other parts of the world where the government subsidizes these investments through tax policy, financing, absence of regulation, or worker incentives such as government paid health care. US capital is flowing to parts of the world where its “risk” is mitigated by government policy. It is also fleeing the US market where public policy favors imports at the expense of domestically produced products. Having worked in US industry for 30+ years I do believe US workers and capital can be competitive if the playing field is truly level. Unfortunately it is not level.
It is in the strategic interest of this country, and our long term economic health to have a productive manufacturing base. Manufacturing jobs provide the economic support for a vibrant middle class essential to our republican form of government and social stability. Without it we will become a third world country of elites and the low skilled masses.
I would eliminate all import tariffs. True free trade is unilateral.
I would eliminate all business taxes. Why do we tax the most efficient?
Eliminate the income tax. Apart from being a form of slavery it taxes the very things we should be encouraging.
I would eliminate class action lawsuits. Class action is just a mechanism to circumvent the constitutional requirement for standing.
Every state should have the same rights over their public lands that Texas got when it joined the union. That would effectively neuter the EPA and the Interior Department.