According to a recent MTV poll, young people are sweating over the state of the economy. And with good reason: The economy has had its share of troubles over the last few years, and many young voters are concerned about jobs after college and outsourcing. To add more fuel to the fire, experts have been predicting for years that Social Security will go broke before 2050, leaving no cash for young people who've paid into the system for years. So what do the two major presidential candidates plan to do to give the economy a kick-start and ensure that there will be security benefits in your future? Here's the quick and dirty:
Don't Mess With Taxes
President Bush believes that tax cuts stimulate the economy and create jobs by giving people more money to spend and businesses more money to expand their services. After taking office, Bush introduced the biggest across-the-board tax cuts since President Reagan. As a result, 111 million Americans and 90 percent of small-business owners are paying fewer taxes today.
But are the tax cuts creating growth? There's no real consensus yet. Alice Rivlin, senior fellow at the Brookings Institution, recently argued that while tax cuts may sometimes stimulate growth, now is not the time: "Extending the full range of President Bush's tax cuts into the indefinite future will create massive deficits that endanger economic growth and load the burden of current spending onto future taxpayers." John Makin, visiting scholar at the American Enterprise Institute, has the opposite take and recently opined that "current tax cuts should be made permanent" in order to keep the economy heading in the right direction.
Senator Kerry supports tax cuts for the middle class, but says that Bush's cuts unfairly favor wealthy individuals and corporations. Accordingly, Kerry would repeal the tax cut for those earning more than $200,000 a year; he plans to use that revenue to finance his health-care plan. Kerry would also close "loopholes" in the tax structure for businesses that outsource American jobs.
Who's Got the Jobs?
Bush believes that when businesses are profitable, they create more jobs. So in addition to tax cuts, he wants to do away with "frivolous" lawsuits (lawsuits which exact exorbitant amounts from businesses) and government regulation that might prevent businesses, big and small, from being competitive in the marketplace.
Kerry's focus is less on big business than on small businesses, which he says create three out of every four new jobs in America. Kerry would offer small-business tax credits and other incentives to help reach his goal of creating 10 million new jobs by 2009. Kerry also wants to raise the minimum wage from $5.15 to $7.00 an hour — an obvious bonus for low-wage workers, but something that critics claim could slow the creation of new jobs.
Less and Less Social Security
President Bush says he'll solve the problem of dwindling Social Security resources by letting younger workers invest a portion of their taxes in private retirement accounts that earn a higher rate of return than the government's current method.
Senator Kerry calls the Bush plan "an invitation to disaster" because he thinks that partial privatization would result in lower benefits for today's retirees. He plans to attack the problem the old-fashioned way: by adding to the coffers through reduced government spending and increased tax revenue.
For more information on the candidates and their positions, check back at ChooseorLose.com this week for more Bush vs. Kerry briefs. And don't forget to vote on November 2!