Rasmussen Reports published today that for the 3rd straight month, Democrats have a 16 point edge among non-investors on the question which party is better at handling the economy. The GOP continues to have a lead that is about half that among investors. See www.Rasmussenreports.com. That’s about a 20-25 point gap at any time, and the simple lesson to make more Republicans here is get more middle class folks to invest in the market.
My idea is simple: Let’s grow the investor class by creating incentives for more people to invest in the economy. There are probably a thousand ways to achieve this aim, but here are a few concrete measures that may work (others may generate more effective measures, but this is a start):
1. Provide tax incentives for investing that make sense for those in lower income brackets.
2. Provide an across the board tax credit equal to a fourth of the money people invest in the market up to a thousand dollars. This would be huge to get middle class folks not yet in the market into the market. Once they’re there, its a lot harder to ignore the Democrats nonsensical positions on capital gains taxes and general antipathy to “big business.” This would also be a great way to direct stimulus funds towards successful businesses that just need investment rather than failed businesses being kept on life support by utilizing the wisdom of the market.
3. Reward successful investing by lowering the capital gains tax on the first $3,000/yr to 0%. This should also help move a lot of middle class folks into the market.
4. Make investment losses fully deductible with no exceptions up to $3,000/yr.