Equity Investment
- Date: Mon, 3 May 1999 16:05:11 -0400 (EDT)
- From: Ben Glover <alyoshakaramazov@hotmail.com>
- Subject: Equity Investment
When discussing the pro's and con's of private accounts one must
not forget the macroeconomic benefits private accounts have over
other solutions. When a dollar of one's payroll taxes goes into
a private account that is invested in the equity markets it adds
another dollar to the investment pool. A larger investment pool
makes it cheaper for companies to expand and therefore create new
jobs by reducing their cost of capital. This not only lowers
unemployment, but adds to the tax base fractioanly thereby helping
Social Security and reducing our deficit and/or incresing our
surplus. Simply "raising the cap" as Mr Shea suggests creates a
zero-sum economic situation and only acts as an income transfer.
The same is true for rasing the payroll tax and the retirement age.