Reforms needed quickly

The stock market, both in the U.S. land internationally, took a major hit this week amid fears that the United States could be entering a recession.

The President, Congress and the Federal Reserve took action to put some quick fixes in place. The prime interest rate was cut and a tax rebate to taxpayers, which would be welcomed by middle-class Americans, was in the works.

But both of those fixes are really just band aids. The problem is much deeper and will require a much more extensive set of solutions. Americans understand this, as the economy has become a more important issue than the war in Iraq (which is bankrupting us and contributing significantly to our economic problems).

Both the housing and banking industries are in crisis, and American consumer debt is at record levels.

For the average American, the issue is quite simple. Costs for just about everything have been rising rapidly, but paychecks haven't.

We've always believed that the economy is driven as much by psychology as it is by money. Right now, the mindset is that we are heading for a recession and that belief could very well become a self-fulfilling prophecy.

Several things need to be done.

First, we need an energy policy that will send prices for oil and other energy services down -- significantly. The folks in Washington, D.C., have been promising us a comprehensive energy policy since the first oil embargo of the 1970s, but no one has really put one together. There is very little time left to do so. It doesn't help that our recent foreign policy has been so poor that we've managed to anger half the major oil producing nations in the world, who, because of the industrial growth of third-world nations, don't need the United States as a buyer as much as they did before.

Second, we need a comprehensive reform of the tax code, which has gotten out of hand in its complexity and has become clearly designed to aid the rich. When Bill Gates pays less personal taxes than the average blue-collar American, you know things are wrong. Listen to the presidential candidates this year. How do they plan on funding their multi-billion-dollar proposals for say, health care or education reform? By simply ending the tax cuts Bush gave the rich during his term in office. We're talking $150-$160 billion a year by repealing those cuts alone.

There are simply too many deductions that the rich can take advantage of and that aren't available to the average American. If you can afford to buy a $100 million yacht, you really don't need to get a tax deduction/credit for it. Where we do need deductions are for medical and education costs, with greatly reduced "minimums" for a citizen to qualify for them. But overall, there should be very few deductions in the tax code, a move that would actually reduce the tax load on middle-class Americans by a significant amount.

Action on those two fronts would go a long ways toward restoring the economic health of this country.

-- Kelly Everitt