by Kitty Testa
1. Deregulate the Subsistence Economy
The IRS and the state Departments of Revenue are adamant about tracking financial transactions so that they can wet their beak every time money changes hands. This is especially true of those who make ends meet by working odd jobs or have micro businesses, such as daycare or itinerant computer repair. These are often cash businesses with marginal incomes.
The federal requirement for companies to collect a W-9 for every payee who is paid over $600 in a fiscal year is ludicrous and bars subsistence entrepreneurs from commercial markets. If you hire someone to wash your store windows for $50 per month, that vendor is required to supply you with a W-9 with his tax ID so that you can issue a 1099 at the end of the year, putting that income on the IRS’s radar.
Those who provide daycare in their homes are put under enormous regulatory burdens in many states, and the federal child care credit has ensured that the income daycare providers receive is taxed as personal income because you can’t take the credit without a receipt from the daycare provider.
Micro-business start-ups must deal with the same burdens as small and middle-sized businesses. They need to get an FEIN number, choose whether to be a sole proprietorship, partnership, LLC or corporation. For most people, this requires hiring accountants and lawyers. Why should this be necessary for someone who wants to babysit, mow lawns or fix fences? The regulations discourage entrepreneurship in micro-businesses that can sustain a family, or grow into a larger business that employs others.
If the laws were changed to exempt businesses grossing less than $50K per year on services, it would be a boon to the subsistence economy and help people graduate out of the poverty cycle without being penalized with fees and taxes.
2. Repeal the ACA and Interstate Insurance Regulations
As the Affordable Care Act has proved itself to be the Unaffordable Care Act, Congress should act to repeal that massive overhaul of our healthcare industry and instead embrace an alternative that had been proposed years ago: repeal the interstate insurance regulations that disallow people from forming groups across states and bargaining with insurance companies directly.
Not only could free people organize themselves into bargaining groups, they could form groups that self-insure, sidestepping the health insurance behemoths like Aetna, Blue Cross and United Health Care. Think of all the money those groups would save by not having to subsidize the enormous overhead of corporate health insurance providers.
A free market in insurance and health care would give people more choices, spawn health care and health insurance alternatives, and give people the freedom to choose from among a variety of products that meet their needs.
3. Repeal the USA PATRIOT Act
The USA PATRIOT Act and associated legislation passed after 9/11 have restricted Americans’ freedom and privacy in ways unimaginable before the September 11 attacks. Supporters of the Act claim that it has made our country safer, but there is no evidence to support the claim. It is in fact a web of espionage against Americans wrapped in a web of security theater.
Why does this matter? Studies show that people behave differently when they are being watched. They are more likely to engage in behavior that elicits public approval and refrain from behavior that might get them in trouble. Jonathan Penney, a Ph.D. candidate at Oxford discovered a “chilling effect” in a variety of Internet searches after Edward Snowden broke open the government’s metadata collection operation.
Free people should not have to worry about who is watching their Internet searches, reading their emails or listening to their telephone calls. This inhibits research and discussion into topics that might be construed as subversive or unpatriotic, even if your motivations are completely the opposite. For example, let’s say you were an Islamic-American parent interested in how Islamic-American youths are radicalized by ISIS so that you could protect your children from radicalization. Would you feel free to get on the Internet and study the phenomenon? I certainly wouldn’t. In fact, I might fear that I could be arrested and held without trial under the National Defense Authorization Act.
4. Stop Using the Tax Code to Manipulate Behavior
Our income tax code is a complicated mesh of rules, exemptions, credits and adjustments hobbled together over the years to encourage some activities and discourage others. Home mortgage interest is tax deductible to encourage us to own expensive homes. Bonus depreciation encourages businesses to buy new equipment. You can get tax credits for opening a business in a certain location or for performing certain kinds of research and development. In some years, you could get tax credits for upgrading to energy efficient windows and appliances.
The problem with this manipulation is that it adds variables to what would otherwise be rational market decisions. Should you own an expensive home? Not necessarily, and the income tax code should not reward people simply because they do. In fact, after the housing crisis, the government was literally paying first-time home-buyers $8,000 if they purchased a home.
When the government picks winners and losers, we are less free. Our market choices should be made with our own needs in mind and without government interference or influence.
5. Shut Down the Department of Education
The Department of Education was created in 1980 to “promote student achievement and preparation for global competitiveness by fostering educational excellence and ensuring equal access.” Now ask yourself how that has worked out.
The quality of American public education was already on decline when the Department of Education was created, and the decline has continued, and perhaps even accelerated, in the years since it began its mission. According to Forbes, the decline in education is even jeopardizing national security.
The United States invests more in K-12 education than many countries, about $10-$14K per pupil annually, but that investment is not so much in the children themselves, but in administration, teacher pensions, and facilities. Education spending has been increasing, while the quality of education is decreasing.
The Department of Education has strong-armed states into accepting Common Core in an effort to shore up educational standards, but the curriculum is extremely unpopular with many parents and teachers. Common Core is unlikely to achieve the educational gains it claims, and will further provide an excuse for schools that fail to provide an adequate education.
It is no wonder that homeschooling has surged over the last several years, up 62% from 2003–12.
The federal government has proved that it cannot improve education, yet its Education Department budget for 2016 provided $70.7 billion in discretionary spending.
Our collective intellectual decline is more than humorous fodder for Mark Dice videos. An uneducated and uninformed populace is inherently less free. Dismantling the US Department of Education is a first step in returning education back to communities and individuals who have a true, vested interest in the education of their children.