Libertarians don’t just complain about socialists; we offer practical solutions to the problems they create. Here are a few deceptively simple ones you will hear more about in the campaign.

Social Security. Eliminate all taxes on wages at age 65. Work as long as you like and keep everything you earn, or retire - your choice. This costs absolutely nothing and there is no downside. If nobody chooses to keep working, there would be no change to the status quo; each person that does keep working reduces the amount of benefits that have to be paid from borrowed money, and eases the stress on the system. The taxes “lost” to the government would not have been collected anyway if the person retired at 65. I think we would be surprised how many of us would continue to work if we didn’t have to give it over to the state.

Banking Crisis. Less than half of the bank losses reported last year were real defaults on loans. Most of the losses that triggered a global meltdown were caused by an accounting regulation called mark-to-market. This requires banks to write down the value of loans when market prices drop, even if the loan is still being serviced on schedule. President Roosevelt suspended mark-to-market in the 1930’s, and we should do it now. If we only wrote down loans that were defaulted, we would instantly stabilize the banking system, something our Treasury Secretary hasn’t figured out how to do now in four months since he was announced for the job.

Stock Market. Cut the capital gains tax to zero and leave it there. The minute we do, the value of stocks (and real estate for that matter) increases by 25%, because the same return on investment can be obtained on a stock at a 25% higher purchase price once the tax on its gains is eliminated. Stock prices will soon reflect the new higher value and half of the money you lost in your 401(k) will be restored. Mr. Obama promised to raise capital gains on stocks by 35%, and when he won the election the market dropped 11% - the exact amount I predicted based on the tax rate increase. Guess what, the math works in reverse, drop the rate to zero (matching Hong Kong and many other investment magnets) and the elevator goes back up. Besides, what gains are there to tax, anyway?

Jobs. Cut the corporate income tax in half and leave it there. We have the highest corporate income tax rate in the world. You can’t be for jobs and against the corporations that create them – corporate taxes kill jobs, and we have lost enough. Corporations would invest the money they save in taxes, or pay out dividends to people who invest them – either way jobs are created. And American-made products would cost less, making us more competitive in the global economy. The increased profitability of firms would cause their stocks to rise, and that would recover the other half of the losses in our 401(k). 17% of trillions is a lot more than 35% of nothing, so tax revenues would increase, not decrease, with a rate cut. This has been proven so many times it is not necessary to explain it again.

Stimulus. Between the capital gains cut and the corporate income tax cut, there would be a bonanza of foreign investment in this country, and Americans would invest here too, rather than putting their capital overseas to avoid excessive taxation. The amount of this capital inflow would exceed what the government plans to borrow and spend on its so-called stimulus. The big difference would be private investment would seek out projects that are economically viable, and create 4-5 times as many jobs. The recession would be over in a month and the full recovery would be faster than anyone would think possible. And we would not bury our grandchildren in debt.

Any one of these could be done with a single vote of Congress, followed by a single executive order to a single agency to implement immediately. All four could be done in a week and the turnaround would be statistically visible within a month. Unlike Treasury Secretaries, markets respond immediately to sound economic ideas.

Do those four things and our economy would not just be recovering by the 2010 elections, it would be recovered - everyone back to work; money back into our 401(k); businesses expanding and infrastructure being upgraded. Can you beat that, Mr. Obama? Barney? Nancy? Tammy? If you got it, bring it - I will post your plan on this very blog and endorse it publicly.

It is not likely that any of these simple solutions will be embraced by the current administration, because these are market-based solutions that reduce the power of government over the economy. They work precisely because they remove government and let markets work.

The choice is simple: economic recovery and prosperity for individual citizens, or expansion of power and control of the government. Tammy has made her choice; I have made my choice. What is yours?

Vote Libertarian. Vote for Tim, Not Tammy