Feb 26 2009
To President Obama, After Your Speech
The following letter was sent via USPS mail to President Obama this morning. Please read and add your comments below. If you wish to support our efforts to get this message to Congress and the President, please sign our petition. By signing, you are not endorsing every aspect, only asking that these ideas be considered as a creative solution to a difficult problem.
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February 26, 2009
The President of the United States
Mr. President:
You have asked for ideas from the public — I have a detailed Financial plan based on the Micro-Finance paradigm that many agree will work. This proposal can work hand-in-hand with everything else you are accomplishing.
How do I get confirmation that someone you trust, has taken the time to review the Fiscal Monetary Policy Proposal and outlined Tax Initiative called FUND AMERICA available at
Creating 5 Million jobs in 18 months, this plan provides for a budget neutral $1 Trillion Cash Infusion into the banking system and on into the economy without $1.00 of direct government funding. FUND AMERICA will fully fund a Code Green Economy (Thomas Friedman); Medical, Alternative Energy, and other R & D; infrastructure; vocational training; higher education; urban renewal, low income housing, and micro-finance. Jobs, jobs, jobs. In fact, FUND AMERICA will fund so many necessary projects (your stated priorities!) that the Budget can focus on the more difficult tasks - the proper domains of government intervention. Best of all, on top of the government not directly funding $1.00 this funding mechanism becomes Renewable and Sustainable.
I keep spending (my family’s) money, time and effort to create public awareness. I’m tired! I’m alone! I’m just 1 person! Mr. President, all I want is to know that someone has seriously looked at the proposal. I do not seek compensation (other than my personal satisfaction that I contributed), you are welcome to “take over” the idea, I don’t have to be associated with it, perhaps better that I am not, and I never wanted to run it!
PLEASE, Mr. President, look at the proposal and you decide to use it in part or in whole, or not.
Hoping to hear back,
Neal H. Katz
Founder, The Prosperity Mandate
Yamhill, OR
P.S. I am and will continue to be a contributor and active participant, just as you ask.
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NOTE: If you have looked over the proposal and have a way to improve on it, or improve the way it is presented here, please enter your comments below. We have already modified the program twice based on reader feedback. This is a grassroots movement, and a model of democracy in action, using social media and word of mouth to spread the word. Though started by one guy in Oregon, it really belongs to everyone, including YOU. Please contribute any additions you would want included in your own Prosperity Mandate program. Thanks!
2 responses so far
I took a look at the program. It makes a little sense. It ignores the complexity of what the tax code is trying to cover. That’s the problem with most of these “simple” tax plans. The world is much more complex than that. People are always creating loopholes to get out of paying taxes and then new laws are created to handle the loophole. Each new law on it’s own is simple but when taken together as a whole the law becomes complex. Throw out the tax code and it will be larger and more complex in a few short years.
Mortgage deductions are already limited. If you make over a certain amount you can no longer deduct mortgage interest. I’m not sure how much that is.
Limiting capital gains makes no sense. Limiting tax free capital gains makes a lot of sense and is already done on real estate up to 250k.
John C
Hard to disagree with someone named JC! However, I will.
Let’s just assume as axiomatic that we have a huge crisis on our hands and the greatest imperative and most critical focus is to create several million new jobs. Just assume this for arguments sake!
How does the lower tax bracket for Capital Gains create jobs. Unless you buy into either one of these two concepts:
1. The Reagonomics “trickle down theory” — which has proven not to work , or
2. if you believe the Keynsian theory of increasing propensity to consume is equal to increasing disposable income — which is simply not possible after the first $1 million and certainly not possible after the second - or $2 Million; then
You are left giving a huge tax incentive that makes wealthy people wealthier - without any direct impact on creating jobs and the economy.
Example 1: When a wealthy individual buys an existing public share of stock and later sells it — not $1 of the transaction (let’s exclude the commission to the broker) goes into the economy — not $1. Why does this get a 60% subsidy in income tax through the Tax Code.
Exception to #1 would be any shares that are purchased at the Initial Public Offering Window — about 86% of that money goes to the company offering its shares to the public and then into the economy — THAT should receive the subsidy - but only then!
Example 2: You own a home that you purchased as an existing home — you sell it after a number of years (having received a subsidy for the cost of owning it via a mortgage deduction) — and make a profit (A) and buy another home for a greater value (B).
The profit on A above receives a 6-% subsidy on income tax - why? It did not create any jobs, income tax deductions through he mortgage have already subsidized the purchase — the home existed and no one went to work — why the subsidy?
If B occurs then the greatest absurdity is that no tax is paid if the seller conducts a 1031 exchange. WHY? If they buy an existing home for equal or greater moneies — no one got any work! Not one job - yet this entire transaction if tax free and there is no limit to the size of the profit. I know I’ve done it — and in today’s economy it is obscene!
Exceptions to # 2: If one of the houses was of new construction - the the tax code should incentivize the transaction — because building new homes create jobs.
Today’s tax code - penalizes an owner for changing the nature of real estate - as in filing a condo map and building condominiums on a apartment building. How idiotic to make a conversion that creates many many jobs in construction and selling of the new homes taxed at normal income tax rates — whereas if you sell it as is, you get both or either Capital Gains or 1031!
Again, if the assumption is job creation, I don’t understand how any of the above is so complex that we cannot change the tax code — albeit somewhat radically for the wealthiest 5% of our nation. But really, they can afford it — AND if they invest in a Fund America Program and create jobs, they WILL get almost an equal benefit - but for really creating jobs.
OK I’m off to LA to meet with my Elementary School Class - should have access to a computer by evening and VERY MUCH want to hear your thoughts, John. You are clearly sophisticated, so I am greatly troubled and need to understand if you do not accept the logic of the above.
Neal Katz