How do we revive the US Economy?
As the Election Politics takes the center stage, a burning question looms amongst all the candidates as to how to revive the US Economy. I agree there are no quick fixes, but the process has to begin we need to address this critical question sooner rather than later.
We have noticed that the US has economy started its downfall in the 90's starting with the decline in manufacturing that saw large Multinational Corporations (MNC's) moving its operations to China, Indonesia, Malaysia, Singapore and South Korea. We need to focus on a return to Manufacturing in the US, this will only happen if the US seriously creates a competitive environment to set Manufacturing in US.
We need to start offering competitive low interest loans to Corporations that manufacture in the US and offer accelerated depreciation for deduction of manufacturing costs, hence the Tax Policy is an effective instrument for encouraging Manufacturing activity in the US.
At the same, we need to reduce the Corporate Tax Rates in the US to remain competitive in the G7 and the G20 bloc of countries. Currently, the US has the 2nd largest Corporate Tax Rate in this group. No wonder MNC's are moving their operations out of the US.
Even, Britain is committed to reducing its corporate tax rate to remain competitive with other G7 and G20, as evidenced by the Chancellor of the Exchequer making the goals of his budget as follows;
"the Chancellor published a whole section of The Plan for Growth , a companion document to the Budget produced by HM Treasury on how the United Kingdom was able to achieve these objectives and it even contains measurable benchmarks as follows;
1. The lowest Corporate Tax Rate in the G7 and among the lowest in the G20
2. The best location for corporate headquarters in Europe.
3. A simpler and more certain Tax code.
It is said that the "Chancellor has tailored his policies to address these three criteria."