How to rescue the economy, in my opinion.

It's all about jobs, and since the vast majority of jobs are either small business or self-employed, I would - if President of the USA - focus on microeconomic policies rather than macroeconomic ideas. My 6 point plan (again, if I were President of the USA):

1. Restructure the SE Tax. Instead of having self-employed pay forward the following quarter's taxes, have self-employed pay taxes on what they actually earned the last quarter. As a matter of fact, self-employed persons have extremely volatile earnings from one month to another, and one quarter to another. By forcing them to pre-pay their taxes, the IRS creates an environment of punishing those who over-estimate their earnings by over-paying their taxes.


2. Require the coordination between federal, state and local taxing jurisdictions, to bring together all of the separate taxes, into a simple, single structure, to which the self-employed and businesses are able to pay out to a single entity (local jurisdiction) which then distributes the share of taxes to the other jurisdictions (city, county, state, federal, etc). In the case of sales taxes, again, one agency to send taxes to, and that agency distributes the revenue. Simplifying the process of paying taxes would greatly improve the response rate, and encourage people to become legitimate businesses.


3. Ban the Business Personal Property Tax, or at least provide a 5 year window where start ups don't have to pay this tax. This is double-taxation of the worst kind, which only eats away at the ability of small businesses and the self-employed to compete as a start up, when you often have high initial investment costs but few - if any - clients.


4. Give the self-employed and the unemployed the right to fully deduct all medical expenses from the first dollar (as opposed to the IRS 2% rule). In addition to this, allow the self-employed and the unemployed to participate in a federally supported healthcare program at a reduced rate, for anyone earning less than 350% of the poverty level (2009 single person $10,830 x 350% = $37,950), to those who do not qualify for Medicaid.


5. Provide a one time 200% deduction rate for start up expenses, for the first year, usable once per company/person, a minimum of five years between your next eligibility for this start up deduction (for another new business). If you cut the cost of starting up a business, you'll increase the number of people willing to work for themselves, but start up costs are huge, and banks are deaf to the plight of the laid off people who wish to start their own businesses.


6. Provide for continued unemployment compensation while people move to self-employment. To provide an incentive for people to become self-employed, federal and state unemployment compensation would provide up to 150% of an individual's maximum weekly unemployment benefit compensation level. If you were eligible for $300/wk of unemployment compensation and you earned a weekly average over one month of $200, you would be eligible to receive an extra $250 a week from the state/feds, to meet that 150% benefit (($300 x 150%) - $200 = $250).

Tax cuts are nice, and spending programs are swell, but in both cases, generally money has to trickle down to the unemployed via several levels of individuals and require the assumption that these people will spend the money they've just earned, in order to spur job growth. If Congress gives direct assistance to the unemployed, small businesses and the self-employed, they will be empowering job growth where it typically starts from, and with immediate results.