http://www.nytimes.com/2011/09/07/opinion/a-capitalist-idea.html?_r=1&re...

Op-Ed Contributor

A Capitalist Idea

By WILLIAM M. WALKER

Published: September 6, 2011

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Chi Birmingham

 

Related in Opinion

• Op-Ed Contributor: Invest in Workers (September 7, 2011)

• Op-Ed Contributor: Not More of the Same (September 7, 2011)

• Op-Ed Contributor: Freeze Public Wages (September 7, 2011)

Room For Debate

Can the Middle Class Be Rebuilt?

Should the government strive to create middle-paying jobs? If that is a lost battle, what is the alternative path to recovery?

Significantly reduce Sarbanes-Oxley regulations for public companies with revenues under $500 million. My company went public last year and spends $3 million to $4 million a year in additional insurance, accounting and legal costs stemming from compliance with Sarbanes-Oxley financial reporting.

Reinstate Glass-Steagall and eliminate Dodd-Frank. Get commercial banks back to being banks, and get investment banks back to raising capital and trading. Reinstating Glass-Steagall would force the “too big to fail” banks to divest assets, something Dodd-Frank does not address.

Raise rates on short-term capital gains and lower rates on long-term capital gains. Hedge funds and private equity investors should not be rewarded for short-term capital gains that produce enormous market volatility. Raise the short-term capital gains rate to 35 percent, and lower the long-term rate (over one year) to 10 percent.

Provide companies with the confidence that if they invest in the United States, they aren’t going to face increased wage and benefit costs. Businesses will not invest if they don’t know the actual cost they will bear to comply with health care, consumer protection, banking and environmental regulations. The president has created a regulatory landscape that scares investors and is making chief executives hoard cash.

Require any mortgage originator who sells a mortgage to Fannie Mae or Freddie Mac to take a first-loss position, meaning that if the loan goes bad, the originator, not Fannie or Freddie, is responsible for the first 5 percent loss, and then shares losses with Fannie or Freddie up to 20 percent.

Means-test Social Security. Many wealthy Americans do not need benefits. Give them a tax deduction to the value of their estate for their accumulated contributions.

Make serious cuts in Medicare and Medicaid. The health care bill sent the message that we will insure every American and cover every disease. We cannot afford that type of health care. Americans need to take responsibility for their health and realize that life choices (smoking, overeating, etc.) may produce health conditions that are not covered.

Identify 100 major infrastructure projects that will put this country ahead of our competition and put people to work building high-speed trains, highways, water pipelines, irrigation canals and alternative energy sources. Borrow as much money as the government possibly can to fund this investment. At 2 percent interest, it’s a good investment.