01 November 2009
Bottoms Up! Revisited
[Please note: This is a revision of an earlier posting in November 2009 due to comments I received from one of my cousins with years of family farm experience. Thanks, Mike.]
It is time for some solutions, practical ones that can help the majority of Americans now. First, we need a tax deduction for interest and fees charged by the banks for our credit purchases. Second, we need small business enterprise regions supporting the restoration of local merchants and services to boost local employment. Third, we need to create much smaller, fully funded, family farms to produce the food we eat locally, not as determined by an international agricultural conglomerate.
It is time for some solutions, practical ones that can help the majority of Americans now. First, we need a tax deduction for interest and fees charged by the banks for our credit purchases. Second, we need small business enterprise regions supporting the restoration of local merchants and services to boost local employment. Third, we need to create much smaller, fully funded, family farms to produce the food we eat locally, not as determined by an international agricultural conglomerate.
How do we do it?
- A Tax Cut. As a temporary boost to taxpayers' net income, Congress should approve an additional tax deduction on their tax returns, beginning with 2009 IRS rules, for 45 percent of money spent on credit card interest rates and fees. For me, that would be the minimum level for deduction. This approach would allow consumers to manage their retail debts within the stagnant income levels most have. Further, it would lessen the depletion of personal savings just to pay bills and income taxes. The loss in tax revenues should be funded by unallocated Stimulus Funds or from recovered TARP loans. Such a deduction would benefit the largest number of taxpayers this year. Congress might want to have a defined period for this deduction, but in the meantime there will be help for those not seeing any benefit from the trickle down approach of the Wall Street bailout.
- Small business enterprise regions, rather than zones. In the just recently passed legislation for small business administration, there was no requirement for applicants to provide business plans for assessment by the Administrator. Perhaps individual Administrators would require such documentation, but it should be a universal requirement following FASB accounting principles. The business plan should include all years for which federal funds are borrowed and repaid. Thus, a one-year business proposal will not suffice if the purpose is to rebuild the small business portion of our economy. There also were no provisions for standardized audits of borrowers under this plan. The GAO lacks the resources, just as do most federal audit agencies. Each region should have enough independent, financial and operations auditors to periodically assess the user of borrowed federal funds for the Administrators. Optimal use of SCORE volunteer consultants could help many small businesses to succeed.
- Rebuild the family farm infrastructure for domestic food needs. With the implementation of corporate agricultural combinations and NAFTA, the small family farmer industry has been decimated. Using Stimulus Funds, regional Administrators should establish requirements for lending federal funds to small farm applicants. As with the small business loans, each applicant should have to provide business plan covering the years that include federal funds. For the purpose of this federal action, a small farm cannot exceed two sections in size and with no restrictions on the number of farmers included in that limit. [Note: 1 section = 1 sq. mile = 640 acres] In the US, a township measures 36 sections. The intent for these small farms would be to provide local produce, meat and produce for local retail grocers, especially near major urban centers. The corporate agriculture companies can focus on exports and packaging. The funding process would extend for a year: upon receipt of an eligible application and business plan, a Regional Administrator would grant the applicant the prospective year's capital and operating expenses and family support income to establish a sustainable farm business. In Year Two, the Regional Administrator would evaluate the grantee's family farm business and offer recommendations for improvements or for additional grant funds if the initial grant could not succeed due to natural disasters, including storm damage, floods, infection of crops. If the recipient of a full grant for establishing and maintaining a family farm business fails, then the Regional Director will oversee the sale of grantee assets to another applicant.
Sherfdog
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