On one hand, you tell us, let us (the tax payer) decide what is best to do with the excess money the government is collecting, on the other hand, you promote a new tax policy which will form "capital". If MZM was not standing at about 30% of where it was last year, I could understand a "cry for capital formation", my tenet is that the money is there, there just are no economically sound investments for that money (right now, that may change, of course), because in general the whole world is awash in excess production capacity. Why should the government decide that investments in telecoms is what we need now? Let the market determine that. I don't where you get that there is shortage of capital (the fact that there is no such a shortage is what might very well delay the impact on the economy of the consecutive urgent interest rate reductions by the fed). Could it be that the bubble that we have just experienced might have been due, partially, due to excess capital formation, seeking at any cost medium of investments, and finally being sent to money heaven, because, there was no final demand for the "products" (or lack of products) that bubble created? Do we want more of that?
I agree that it is not the government job to "allocate" capital, but if they decide it is their job (and some how congress and both political parties always think it is their job, no, their privilege), maybe alternative opinions should be heard. That is one reason I suggest a more rational method of taxation, and a method that can be used rapidly to adjust taxation without changing the tax structure, within the year when imbalances occur.
Zeev |
