Open Letter to Sen. McSally: Real Help for Arizona Recovery and America Reopening

 

Senator McSally, I deeply admired your real courage when we were both young field grade officers, you in the Air Force and me in the Army. Your stand for the Constitution against the House of Saud and the Pentagon was principled and made a real difference. I greatly worry that you are on track to become a two-time loser in races for the US Senate. You can win big by returning to your roots and doing the right thing for millions of Arizonans. You must persuade Sen. McConnell to make personal and real small business “COVID-19 debt” 100% tax credit refundable on the next two quarterly tax payment dates: rent, mortgage, lease, and car/truck payments between the end of March 2020 and 1 July 2020.

The national and state executives, with the complicity of the Congress and state legislatures, crushed at least tens of millions of Americans’ lives, driving them into massive debt from which they cannot reasonably recover. All the federal programs so far have been good as far as they went, but did not get at the basic problem.

People are falling hopelessly behind on apartment/home rent, mortgages, business property leases, and car/truck payments. Make the property managers, mortgage holders, and vehicle note-holders an offer they cannot refuse. Make every dollar they forgive between the end of March and the end of June immediately 100% refundable on their quarterly tax payments at the end of June and September. This will be massive, but it is the actual cost of the decisions made by President Trump, affirmed by you, and the governors, affirmed by the state legislatures’ non-objection.

Sweeten the deal further for each state by also ordering the Department of Treasury to fully honor all state requests for 100% reimbursement for each state and local property tax payment documented as forgiven between the end of April and the end of September 2020. This will go a very long way to stabilizing the states’ finances, while pushing them to help their citizens.

Keep it simple. Add two provisions to encourage good behavior: create federal penalties for any credit agency accepting any such debt/delinquency report for the time period. Prohibit any attempt to collect any such debt for the relevant period, beyond a request or communication without threats. Everyone with good intentions should be happy to collect from the IRS instead of looking bad by pressuring people hurt by the government’s orders.

In short, decisively act on the side of the people of Arizona. Ask Senator Sinema to cosponsor this legislation. That way lays victory for Arizona, America, and you.

You are welcome:

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  1. Bob Thompson Member
    Bob Thompson
    @BobThompson

    I think President Trump will again seek at least a suspension of the payroll tax to help small business and self-employed individuals. I have a very small opinion of the income tax but nothing is lower in my esteem than the payroll tax of 15.3 % being applied to the very first dollars of earned income even for those living out the year at incomes below poverty levels. I support a permanent revocation but a temporary suspension during this crisis will help.

    • #1
  2. Aaron Miller Member
    Aaron Miller
    @AaronMiller

    Clifford A. Brown: People are falling hopelessly behind on apartment/home rent, mortgages, business property leases, and car/truck payments. Make the property managers, mortgage holders, and vehicle note holders an offer they cannot refuse. Make every dollar they forgive between end of March and end of June immediately 100% refundable on their quarterly tax payments at the end of June and September.

    Good idea. 

    Clifford A. Brown: make it a federal criminal offense, per instance, for any credit agency to accept any such debt/delinquency report for the time period. Make it a federal criminal offense to attempt to collect any such debt for the relevant period.

    Not such a good idea. This treats all cases the same, whereas creditors have better information and already have an incentive to seem generous and flexible: marketing. 

    If government involves itself further in corrections, helping lenders should be enough. But a tax writeoff might be insufficient. Lenders, like borrowers, form plans around expected income and might need assistance sooner than later. 

    • #2
  3. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    Bob Thompson (View Comment):

    I think President Trump will again seek at least a suspension of the payroll tax to help small business and self-employed individuals. I have a very small opinion of the income tax but nothing is lower in my esteem than the payroll tax of 15.3 % being applied to the very first dollars of earned income even for those living out the year at incomes below poverty levels. I support a permanent revocation but a temporary suspension during this crisis will help.

    That is a good idea as well, but does not have near the size and speed of effect as this proposal. When people are not earning in the first place, or seeing only a fraction of their usual income, removing a big chunk of debt, directly linked to the governments’ orders, has a massive, immediate effect. 

    • #3
  4. The Reticulator Member
    The Reticulator
    @TheReticulator

    For this to work, there has to be some way to route the money through the government or increase the power of the government. Lacking that it doesn’t stand a chance.

    • #4
  5. Rodin Member
    Rodin
    @Rodin

    I hate blowing a hole in the budget, but in reality this has been a massive government taking and I see no way of rectifying it other than massive payments.

    • #5
  6. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    Aaron Miller (View Comment):

    Clifford A. Brown: People are falling hopelessly behind on apartment/home rent, mortgages, business property leases, and car/truck payments. Make the property managers, mortgage holders, and vehicle note holders an offer they cannot refuse. Make every dollar they forgive between end of March and end of June immediately 100% refundable on their quarterly tax payments at the end of June and September.

    Good idea.

    Clifford A. Brown: make it a federal criminal offense, per instance, for any credit agency to accept any such debt/delinquency report for the time period. Make it a federal criminal offense to attempt to collect any such debt for the relevant period.

    Not such a good idea. This treats all cases the same, whereas creditors have better information and already have an incentive to seem generous and flexible: marketing.

    If government involves itself further in corrections, helping lenders should be enough. But a tax writeoff might be insufficient. Lenders, like borrowers, form plans around expected income and might need assistance sooner than later.

    I generally agree, but the point is to make it an offer they cannot refuse, to get ill-motivated people/organizations to see the light. There is no “sooner” when you are trying to squeeze blood out of a turnip. Getting all the money owed by early July is far better than absorbing very bad publicity plus incurring costs of trying to collect, plus eviction, foreclosure, repossession costs.

    • #6
  7. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    The Reticulator (View Comment):

    For this to work, there has to be some way to route the money through the government or increase the power of the government. Lacking that it doesn’t stand a chance.

    Fair point, but in the time of Trump, we have seen things that were supposedly impossible for decades suddenly pass and get signed into law.

    • #7
  8. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    Rodin (View Comment):
    I hate blowing a hole in the budget

    <Giggles uncontrollably>

    but in reality this has been a massive government taking and I see no way of rectifying it other than massive payments.

    Sadly so. The thing, then is to make at least the least bad decision on what the massive payments should be. I really think this is the best call, the most effective at putting almost everyone back to somewhere close to where they were before President Trump and the governors crashed the economy. I got strong agreement from a couple Mesa small business owners, who are looking at the debts over their businesses and their families and their employees and the people they need to come back in and start spending money. People will thousands of dollars in new, unexpected, debts are not in a position to suddenly start eating out or buying coffee drinks.

    • #8
  9. The Reticulator Member
    The Reticulator
    @TheReticulator

    You mean if I quick loan each of my kids a few thousand they can’t/won’t pay back, I can write it off as a deduction against income? (I’m just trying to beat the rush through the loopholes.)

    • #9
  10. I Walton Member
    I Walton
    @IWalton

    Lets be clear.  If the government collects taxes it spends it doing government things, some of which may be useful and productive but it takes the money away from folks who would buy things, invest or save.  If it doesn’t collect taxes, those folks will buy things, invest or save and the government will spend doing government things that may be useful.  What ultimately decides the outcome is how much new money is printed to cover the  spending especially now that there is so much less to spend on.  So just tighten; interest rates will go up, more folks will save, maybe the government would even reduce useless spending.  What is the grater threat,  inflation or interest rates so high we can’t function?  Interest rates are not a threat in this economy but inflation is.  Tighten and cut taxes.  We may learn something very important we forgot several centuries ago.

    • #10
  11. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    The Reticulator (View Comment):

    You mean if I quick loan each of my kids a few thousand they can’t/won’t pay back, I can write it off as a deduction against income? (I’m just trying to beat the rush through the loopholes.)

    No, as should be obvious from the OP. The fed and state governments forced tens of millions out of work, took away, at gun point, their ability to pay largest monthly bills. That debt is owed but will be near impossible to repay or to effectively collect. So it is proper for the same government to eat the cost, turning it into long term federal debt, real cost of decisions.

    • #11
  12. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    I Walton (View Comment):

    Lets be clear. If the government collects taxes it spends it doing government things, some of which may be useful and productive but it takes the money away from folks who would buy things, invest or save. If it doesn’t collect taxes, those folks will buy things, invest or save and the government will spend doing government things that may be useful. What ultimately decides the outcome is how much new money is printed to cover the spending especially now that there is so much less to spend on. So just tighten; interest rates will go up, more folks will save, maybe the government would even reduce useless spending. What is the grater threat, inflation or interest rates so high we can’t function? Interest rates are not a threat in this economy but inflation is. Tighten and cut taxes. We may learn something very important we forgot several centuries ago.

    Agree. And. My OP stands.

    • #12
  13. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    I have since sent the core of this message to:

    • President Trump at Whitehouse.gov
    • Congressmen Gosar and Stanton of AZ
    • Senator Sinema, my state’s senior senator, and
    • Senator Ted Cruz

     

    • #13
  14. The Reticulator Member
    The Reticulator
    @TheReticulator

    Clifford A. Brown (View Comment):

    The Reticulator (View Comment):

    You mean if I quick loan each of my kids a few thousand they can’t/won’t pay back, I can write it off as a deduction against income? (I’m just trying to beat the rush through the loopholes.)

    No, as should be obvious from the OP. The fed and state governments forced tens of millions out of work, took away, at gun point, their ability to pay largest monthly bills. That debt is owed but will be near impossible to repay or to effectively collect. So it is proper for the same government to eat the cost, turning it into long term federal debt, real cost of decisions.

    But you need to write the law in a way to specify which debts would qualify, no?  And there might be a lot of mischief in those specifications.

    • #14
  15. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    The Reticulator (View Comment):

    Clifford A. Brown (View Comment):

    The Reticulator (View Comment):

    You mean if I quick loan each of my kids a few thousand they can’t/won’t pay back, I can write it off as a deduction against income? (I’m just trying to beat the rush through the loopholes.)

    No, as should be obvious from the OP. The fed and state governments forced tens of millions out of work, took away, at gun point, their ability to pay largest monthly bills. That debt is owed but will be near impossible to repay or to effectively collect. So it is proper for the same government to eat the cost, turning it into long term federal debt, real cost of decisions.

    But you need to write the law in a way to specify which debts would qualify, no? And there might be a lot of mischief in those specifications.

    Quite so.

    I thought I was being fairly clear. The biggest monthly bills and the greatest threats to people are the cost of keeping a roof over their and their family’s head (rent or mortgage payment) and having the mobility necessary to work and shop in our society (car/truck monthly note). The relevant period is end of March through June, as that is the obvious time period during which President Trump and the governors forced people not to earn the money they must have to meet their bills so that they are not facing down eventual eviction/foreclosure and waking up to find the repo man snatched their vehicle back. Yes, there has generally been a period of forbearance, but that will pass and the twin threats are hanging over millions’ heads.

    • #15
  16. The Reticulator Member
    The Reticulator
    @TheReticulator

    Clifford A. Brown (View Comment):

    The Reticulator (View Comment):

    Clifford A. Brown (View Comment):

    The Reticulator (View Comment):

    You mean if I quick loan each of my kids a few thousand they can’t/won’t pay back, I can write it off as a deduction against income? (I’m just trying to beat the rush through the loopholes.)

    No, as should be obvious from the OP. The fed and state governments forced tens of millions out of work, took away, at gun point, their ability to pay largest monthly bills. That debt is owed but will be near impossible to repay or to effectively collect. So it is proper for the same government to eat the cost, turning it into long term federal debt, real cost of decisions.

    But you need to write the law in a way to specify which debts would qualify, no? And there might be a lot of mischief in those specifications.

    I thought I was being fairly clear. The biggest monthly bills and the greatest threats to people are the cost of keeping a roof over their and their family’s head (rent or mortgage payment) and having the mobility necessary to work and shop in our society (car/truck monthly note). The relevant period is end of March through June, as that is the obvious time period during which President Trump and the governors forced people not to earn the money they must have to meet their bills so that they are not facing down eventual eviction/foreclosure and waking up to find the repo man snatched their vehicle back. Yes, there has generally been a period of forbearance, but that will pass and the twin threats are hanging over millions’ heads.

    OK, you’ve covered the loophole I was trying for, but it isn’t hard to imagine others within the criteria you mention. Some people pay for their houses through contracts for deed between private parties, for transactions that didn’t have the imprimatur of the FHA. Are  you going to leave them out?  Then I’m not so enthusiastic about your proposal. But if you include them, you’re allowing for arrangements that might stretch the definition of what is intended to be covered.  And on and on. 

    • #16
  17. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    The Reticulator (View Comment):

    Clifford A. Brown (View Comment):

    The Reticulator (View Comment):

    Clifford A. Brown (View Comment):

    The Reticulator (View Comment):

    You mean if I quick loan each of my kids a few thousand they can’t/won’t pay back, I can write it off as a deduction against income? (I’m just trying to beat the rush through the loopholes.)

    No, as should be obvious from the OP. The fed and state governments forced tens of millions out of work, took away, at gun point, their ability to pay largest monthly bills. That debt is owed but will be near impossible to repay or to effectively collect. So it is proper for the same government to eat the cost, turning it into long term federal debt, real cost of decisions.

    But you need to write the law in a way to specify which debts would qualify, no? And there might be a lot of mischief in those specifications.

    I thought I was being fairly clear. The biggest monthly bills and the greatest threats to people are the cost of keeping a roof over their and their family’s head (rent or mortgage payment) and having the mobility necessary to work and shop in our society (car/truck monthly note). The relevant period is end of March through June, as that is the obvious time period during which President Trump and the governors forced people not to earn the money they must have to meet their bills so that they are not facing down eventual eviction/foreclosure and waking up to find the repo man snatched their vehicle back. Yes, there has generally been a period of forbearance, but that will pass and the twin threats are hanging over millions’ heads.

    OK, you’ve covered the loophole I was trying for, but it isn’t hard to imagine others within the criteria you mention. Some people pay for their houses through contracts for deed between private parties, for transactions that didn’t have the imprimatur of the FHA. Are you going to leave them out? Then I’m not so enthusiastic about your proposal. But if you include them, you’re allowing for arrangements that might stretch the definition of what is intended to be covered. And on and on.

    Yes, and. Good versus perfect. I see a large scale issue for the people hit hardest by government action here. The PPP and the one-time cash payment and unemployment are all patches on the gaping holes blown in the bottom of the boat. This is another plank, another patch, to partially address the taking by government.

    • #17
  18. Bob Thompson Member
    Bob Thompson
    @BobThompson

    Clifford A. Brown (View Comment):

    Bob Thompson (View Comment):

    I think President Trump will again seek at least a suspension of the payroll tax to help small business and self-employed individuals. I have a very small opinion of the income tax but nothing is lower in my esteem than the payroll tax of 15.3 % being applied to the very first dollars of earned income even for those living out the year at incomes below poverty levels. I support a permanent revocation but a temporary suspension during this crisis will help.

    That is a good idea as well, but does not have near the size and speed of effect as this proposal. When people are not earning in the first place, or seeing only a fraction of their usual income, removing a big chunk of debt, directly linked to the governments’ orders, has a massive, immediate effect.

    I understand your point. I have a strong revulsion to our whole approach for federal taxation so I keep rooting for a foot in the door for change and the payroll tax levied on low income individuals, self-employed or working for small business, is the best opportunity. 

    • #18
  19. Clifford A. Brown Contributor
    Clifford A. Brown
    @CliffordBrown

    Bob Thompson (View Comment):

    Clifford A. Brown (View Comment):

    Bob Thompson (View Comment):

    I think President Trump will again seek at least a suspension of the payroll tax to help small business and self-employed individuals. I have a very small opinion of the income tax but nothing is lower in my esteem than the payroll tax of 15.3 % being applied to the very first dollars of earned income even for those living out the year at incomes below poverty levels. I support a permanent revocation but a temporary suspension during this crisis will help.

    That is a good idea as well, but does not have near the size and speed of effect as this proposal. When people are not earning in the first place, or seeing only a fraction of their usual income, removing a big chunk of debt, directly linked to the governments’ orders, has a massive, immediate effect.

    I understand your point. I have a strong revulsion to our whole approach for federal taxation so I keep rooting for a foot in the door for change and the payroll tax levied on low income individuals, self-employed or working for small business, is the best opportunity.

    Completely agree.

    • #19