John Cena - SAS CLASSIC

Transcript

When you choose to earn your degree online from Southern New Hampshire University, you're saying yes to new opportunities and to new adventures. You're saying yes to something big, something you've always wanted to do. If earning your degree is one of your goals this new year, SNHU can help you get there. With low online tuition, no set class times, and multiple term starts per year, you can set the pace that works for you and save money along the way. Visit snhu.edu today to get started. This isn't your average business podcast, and he's not your average host. This is the James Altucher Show. So last week, we spoke about running for president Right. With the problems facing the country today. Yeah. And I mentioned how I'm running for president Yes. Officially on the federal election commission. It's half joke, half serious, and I didn't say what I stood for. But, Jay, what else did we speak about last week? We speak about the difference between prime minister and president. Oh, yeah. And fascism and all that kind of stuff. And we spoke about what happened if president and vice president died. And then we also spoke about how government organization is kinda mafia like. Yeah. That's right. Although it's not, we concluded. But then Yeah. We also talked about inflation last week and what's causing it, where the Federal Reserve might be wrong. And we talked about how I hate to sound like a libertarian or any particular party, but really, when government interferes in things, it kinda messes things up. And we looked at extreme examples like the difference between Stalinist Russia and Maoist China and the United States, which are sort of the most extreme examples. But today, I promised I would talk about the most important issue and what I feel like is a unique stand on it, and I figured I would talk about it today. Let's say they did a poll of everybody in the country, and they asked me, well, what are the 5 most important problems you would like to see the president address? What do you think the answers would be? Okay. I I would think if I would think the first one would be, the student loan. Right? Because people would just want more money. So that was a that's that's what 300,000,000 people in the US. Let's say 200,000,000 after kids and stuff. It's only 33,000,000 people with student loan debt, so it's not gonna be the most important issue of the country. No. But that's what I've been reading for the past 3 years. Yeah. Yeah. Student loan. I agree. It is a massive problem. You're right. But it's not the most important problem facing the US. Yeah. So 5. Right? You you said 5? Yeah. And, gun control and then, the economy, the the, you know, the price hike, the Federal Reserve, you know, interest rate. But from what I understand, government has nothing to do with it. Right? Because Federal Reserve's supposed to be neutral. Right. But it is the government, though. Federal Reserve is federal. Right. It's the it's part of the it's part of the government. It is the government. Okay. That and I mean, the president appoints the head of the Federal Reserve. And the war. Like, how would president handle the war outside of United States? Personally, I think they put too much money in the Ukraine. You know, whether whether it's money or whether it's equipment and stuff like that. By the way, it's a it's an interesting thing. Like, let's just take Ukraine as an example and war as an example. I think in the modern world, it's really hard. It might be impossible now to invade another country and win. Like, look at the US and Afghanistan. We were in Afghanistan for 18 years, and basically, we were defeated. Like, we put we didn't, you know, maybe we got rid of Al Qaeda, but the Taliban is just as bad as they ever were, and they're gonna take control of Afghanistan. Yeah. Like, basically, we I don't wanna say we did nothing because we did a lot and and a lot of lives were lost and on both sides, and it's a sad thing that had to happen in 911, of course. We had to have some retribution for that, but we couldn't fully invade basically the one of the weakest countries in the world. And Russia is Russia invading Ukraine, It it appears Russia is not going to 6 be successful, and countries just shouldn't invade other countries anymore unless I don't know. Unless what? Like, it just seems like it's a very hard thing to do. Unless they break, was it the the agreement? That's a peace treaty, then that's the excuse to invade. Right? Or to have a war with, like I don't know. But but then again, you're never gonna win. What's the last time a country invaded another country and they won? No. I didn't was it Russia? Russia was the last country to invade the other country, but I do know if they win. Yeah. I mean, they invaded Ukraine, and they didn't win. They they haven't been winning yet. Right. But before that, was it Crimea or whatever? Well, that was part of Ukraine, and this is still kind of Right. You know, I guess, yes. You know, sometimes with diplomacy, you know, some country doesn't wanna fight, and they say, here, just take this, and then it's over. But let me ask you this. Why why is it impossible to win now? Is it because the war is Because it's more sophisticated technology and equipment. You have Mhmm. You have antiaircraft missiles that actually hit aircraft or, like, guided missiles that hit aircraft. They're anti tank missiles. Tanks are so strong, but now there are missiles that could destroy tanks. And Right. You know, it's very hard no matter what equipment you have. It's very hard to fight the anti equipment. Right. And no matter what, like, you could say, oh, we we should or we shouldn't give money to Ukraine. And, look, it's been a very good thing that Ukraine hasn't been, you know, taken over. It sends a message to anybody trying to invade anyone else. But even if the US didn't give money to Ukraine, a lot of other countries did and were. And it's unclear if Russia had the resources to begin with. Like, right now, they're sending people who have just no skills at all in the military to be in the military. But I wanna say the most important issues, number 1, is the economy. 33% of people care about the economy, and they care about recession, taxes, inflation, lack of money, unemployment, gap between rich and poor, oil prices. The money is the most important thing. Number 2 is sort of a BS one. The government slash poor leadership, that just seems like a partisan issue. Like, no matter who's in charge, the other half is gonna say that's a big problem. Number 3 is immigration. 11% of people care about immigration, and that includes all the immigrants like you, Jay. And and then also all the people who care about, you know, immigration and so on. And then after that, there's 3% who care about crime and violence, and only 3% think the most important problem is foreign policy, foreign aid, focus overseas. What? Only 2% think the most important problem in the US is situation with Russia. 2% think abortion is the most important problem. Situation with China, 1%. I think that Robin is that entire 1%. So Well, let me let me ask you this, James. Let me ask you this. I would think it's a good idea to have a president just for the state and then a president that deals with foreign policy. Because I felt like it's hard for 1 person. Obviously, one person can wear multiple hats. But isn't it better if you have 1 person focused like family? You know? That is a very good point, Jay. In fact, there's almost but not quite a precedent for this, which is to start off, Richard Nixon, resigned as president in August of 1974. He was about to be impeached. He decided to resign instead. And Gerald Ford, who was his vice president, took over. And so from 1974 to January 1977, Gerald Ford was president, one of the shortest terms of presidency ever. He did not win reelection, so he lost to Jimmy Carter. And then in 1980, Ronald Reagan was the Republican nominee for president, and he was strongly considering Gerald Ford to be the vice president. So the former president almost became the vice president. That had never happened before. And Gerald Ford's terms were, he said he would do it, but only if he was virtually president for all things foreign relations, and Ronald Reagan would remain president for all things domestic. And Reagan said, get out of here. I don't even need you. What? And Ford did not become vice president. A young man and former director of the CIA named George Bush became vice president, and the rest is history. But but, yeah, it's an interesting thing. You know, typically, what happens is the secretary of state is sort of the main person in charge of all foreign relations, but he still has to report to the president. He can't do anything without the president. So it is the case I mean, we have another precedent, which is that George w Bush, he brought on Dick Cheney to be his vice president. Dick Cheney was roughly almost in terms of power, almost it was at the same level as w and particularly on foreign issues. Like, it was Dick Cheney who mostly encouraged, like, the invasion of Iraq, for instance, in part because he had worked for the older Bush and it was, you know, the older Bush had a grudge against Saddam Hussein and and, you know, and and so on. But it's never it's it's an interesting idea, but you still need one person to kind of sit like, Truman makes it as a famous quote, the buck stops here. Like, you you always have to you know, the president is in charge. So you so if someone is to blame, it's always the president. Gotcha. A lot of people regardless of value people, whether Trump is a good guy, a bad guy, a fascist, a greatest president, like, some people have extreme views on either side when it comes to Trump. There was an issue that I really cared about in the pandemic, which was I don't think we should have locked down the businesses. It's unclear if any lives were saved. You could have done it in a better way that didn't put the economy into a situation which created the economy we're in now. And Republicans will blame the Democrats. The Democrats will blame the Republicans. Like, what The Democrats wanted and and voted for businesses to be shut down, but ultimately the buck stops with the president. Some things I would say they're in the positive column for Trump, but this thing is very much in the negative column. And there's never one president that does everything bad and everything good, and that includes Nixon, that includes Trump, that includes Jimmy Carter, who may many think was an awful president. That includes Lyndon Baines Johnson, that includes possibly the worst president ever, Warren g Harding or Herbert Hoover. Everybody does some good and some bad. And so definitely one of the bad things, maybe the worst thing in Trump's administration was the lockdown in the economy. Even though he would say it's not his fault that the democrats pressured him into it, that was a negative thing. I could say positive things too, but then we get into this area where people are religious about the positive and negative of Trump, and I don't wanna get into that. But I will tell you the most important thing, I agree with the people who say the economy is the most important problem facing the country Yep. Facing any country because there's a saying, when a country is developing, you either trade bullets or dollars. And, you know, if a country can't develop economically, they're gonna end up going to war in order to get at the economic benefits of war, like taking over another country's resources. This was the historical reason for war always is that, oh, they have more food in that country. Let's invade them and take over all their food. Right. Isn't, US also, like, the leader of the economy. Right? Like, everyone's looking at US for economy leadership and economy guidance. Right. Like, here's the thing. Every country has their own currency. And if people demand your currency because they trust your economy, that's the best way to avoid inflation. The best way to avoid real inflation is when other countries want your stuff. Right. And, you know, that makes the economy grow faster than it's not that inflation's bad. It's that that wages need to grow faster than inflation. The economy needs to grow faster than inflation. So people always say, well, inflation's x and that's bad. There's no black and white to this, but you basically have to figure out a way to give more people money, and this is where a lot of people get it wrong. You can't just say, oh, we're gonna do a bailout of blah blah blah. You have to have a justification for it that will make the economy grow or else there will be inflation. Now the US is the most trusted economy. 1, because we take for the most part, we take private property rights very seriously. If you have an idea and you patent it, then you make money when someone steals your idea. If you own a home, somebody else can't just go in your home and say this is my home now. The government can't even do that, I mean, unless you didn't pay your taxes or whatever. You know the other thing about economies, the United States just is where all the innovation happens. It's the biggest economy because not because we sell a lot of toilet paper, we don't, it's because we sell our inventions like biotech, now AI, you know, robots, all these things. Even if we outsource to China the development of these things, all the iPhones are built in China, but the US is the one that sells the iPhones. The Apple is located in the US. They're not located in China. They buy the components and and the pieces they put together into the iPhone, but Apple's the one that actually sells the iPhone. So the US by far is the biggest economy. 20 people say, oh, China's grown faster. They're gonna beat us. Maybe. But the US is at $23,000,000,000,000 in national GDP. China is at 17,000,000,000,000,000, and Japan, number 3, is at 5,000,000,000,000, and Germany is 4th. Gotcha. So, like, the the difference is pretty huge. And India, by the way, growing fast, is 5th. Oh, wow. That's great. Also, just now when you mentioned toilet paper, you said, you know, toilet paper doesn't really make money. I just look it up. In 2023, do you know how much revenue in toilet paper segments, amount to? No. $107,400,000,000. Wow. Toilet paper? Yeah. Are you saying there were a $107,000,000,000 worth of toilet paper was sold? Apparently so according to, what's called Statista dotcom. And the market is expected to grow annually by 5.92%, c a r g r, 2023 to 2027. Well, there you go. So toilet paper is an important part of the economy, but I would argue that technology is a much bigger part of the economy. Yeah. Because, like, technology actually push the civilizations forward. Right? Yeah. And, also, technology is something that you can't beat us on because we're so far ahead in terms of research. Like biotech, we are so far ahead of everyone else on biotech that it's hard for anybody to catch up. So it's really important to create an economy that supports technological innovation. And this is related to immigration too. Like, if more and more, let's say, Asian people decide to go to graduate school in India or China and then stay in India and China and build their businesses there, that hurts the US economy because traditionally the smartest people in these countries would come to the US for graduate school then move to Silicon Valley, start a company, make tens of 1,000,000 of dollars, hire tens of 1,000 of people, create inventions that we sell around the world and and so on. But fewer and fewer Asian people are going to graduate school here, which means fewer and fewer people, Asian people are starting companies here and so on. But immigration is not the most important issue. As I mentioned, it's one of the most important issues. Right. But the economy in general, that's one part of the economy. Sorry. I just want to add something on the immigrations real quick. So in 2011, doctor Michio Keku remember doctor Michio Keku? Did he come on with Yeah. We had him on with he we had him on when when William Shatner came on, and we surprised William Shatner by having Michio Keku come on and come up on the stage and tell us how to use quantum mechanics to make teleportation. Right. But then Michio Kaiko I did ask him, and Michio Kaiko admitted that if you do teleport, probably you die and just a replica of you Yep. Is teleported. So it's not really worth it. Right. So in 2011, Doctor. Michio Kaiku on stage did mention that, you know, America has a secret weapon. America's secret weapon is h one b. That's how, you know, the innovations because of the H1B. Because people stay here, they get the H1B. H1B is a visa for immigrants. And that's how they make all the innovations in science and, you know, technology. But like you mentioned, like, more and more people decided to leave the US to go to India and China to get, you know, get degrees and to start a business there. Even Dubai and was it Israel has a huge start up, initiative? Yeah. Right. Right. So look. And that's a good thing too, though. It's better for the world if the entire world develops. But, you know, it's still important for the US to remain first. Again, that's why look. That's why people buy oil with US dollars. That's why the US dollar is the most trusted currency, and it's why our inflation in the US is not even greater than it is now despite all the money that's been printed during the pandemic and the great recession and so on. But so that that that's a part of the picture, but I kinda think the biggest part of the picture is just give people more money. So but but not in a way not through bailouts, and I'm gonna describe what I mean. This is gonna be related to to taxes. Here's the problem with taxes. Is that let's say, Jay, I decide, okay. You know, I'm gonna take 10% more. I'm gonna raise your taxes 10%. And what am I what am I, the government, gonna do with that extra money? I have to do something with it. Right? The US spends more than it makes, so every dollar that's taxed is spent every year. So I'm gonna do something about let's say I I give that money to the Department of Education. Oh, okay. You say, well, here here's 10% more of my salary. It's going to a good resource education. Here's the problem, and I just say the Department of Education randomly but I could say this about any department, since the Department of Education started the quality of American education has gone down. Like student loan debt has gone up faster than inflation every single year since the Department of Education started. Tuitions have gone up faster than inflation every single year since the Department of Education started. Literacy rates compared to the rest of the world have gone down every single year since the Department of Education started. Doesn't mean everything they've done is bad, it just means you, Jay, could have probably spent this money in a more useful way than the government. So why do the government need to raise your taxes 10%? The government is not the best decision maker. We already know we we already know the importance of growing the economy. That's what keeps Right. Your currency strong and it what keeps inflation down. That's the importance of a growing economy. We know that the government spending does not grow the economy as much as technological innovation, and that in general, politicians and bureaucrats are not entrepreneurs. Like you look at Federal Express, Federal versus the post office. It used to be the post office would be the primary way you would send packages, but now Fred Smith, so, this business school graduate, he had this idea that he can find cheap planes and have hubs all around the country, he could find cheap planes to send packages in one day, and he created a more efficient service than the US government. It's a classic example. So taxes are a real important issue. And for every dollar, either private industry gets the dollar or the government gets the dollar. Either you get an extra dollar, Jay, to spend or the government gets your dollar. When you get an extra dollar, you buy a newspaper with it. The newspaper guy buys a flower with it. The flower guy, maybe it's part of his Netflix subscription. So a dollar moves around the economy many times before it kind of dies out. So it's very important. We we we always complain about the gap between the rich and the poor, and that is an issue because people get angry when they see other people making so much money. But the real important issue is corporations and individuals like you, Jay, if you had you know, everybody who has more money, they get entrepreneurial, particularly more startups are starting than ever. Startups create inventions and innovations, like nobody no. Like, the okay. The government made the Internet, but the Internet didn't become used until basically 25 or 26 years after the Internet was created. You know, people started making websites on this new thing, the web, and that became this huge part of the economy. That was done by private industry. It was not done by the government. Let me ask you something. But before I ask you something, I just wanna tag on to the post office one. In February 2023, USPS is closing 40 post offices. Yeah. I mean, the post office is just I'm losing money. It's because people can't afford to send simple letters. But by the way, when was the last time you sent a letter? You sent email. Yeah. So, again, a private industry, by the way, did not invent email. Okay? It was invented in universities, and it was government funded. But, you know, AOL, let's say, was the first big public use of email, and this was in the early nineties. And that was created by private industry. Steve Case, he actually wasn't the founder of AOL, but he was one of the he was the one of the first he was the second or third CEO there, and he was the one who really made it huge. He basically popularized use of email. That was done in private industry. Now let's say AOL, was taxed 90%. 90% of their profits were taxed. Well, they would never have been able to hire a Steve Case or to build the tools they needed to do to make email popular. And what would have the government have done with that money? Well, a big chunk of the government budget is defense, so it would have gone into, like, you know, war and tanks and things like that. So so, again, the market is a better decider of what to do with dollars than the government is. Just like we discussed last time Okay. Russia couldn't feed its population because they tried to plan everything from beginning to end. Whereas, New York City also can't feed its population, but that's okay because, oh, some people wanna buy food from Walmart, some people wanna buy food from this place, from that place. The market decides how supply and demand are met as opposed to one government leader. Right. So, again, private industry having money. So so let me tell you. Here's my plan to drastically reduce and simplify Right. Taxes in a way that's fair to both poor and rich. I have one question. Real questions. This could be a really dumb questions or a silly question. There there are no dumb questions, as they say. Although, sometimes, you know, maybe you ask dumb questions. But Can taxation be privatized? You know, that's an interesting question. Like, meaning, make the IRS like a business that the government hires. Oh, like our tax. Right? At least so we have like, how I don't even know how much percentage that we give to federal. At least a percentage of the percentage that we give to federal on federal tax maybe should go to be privatized and to have more start ups or to have a better amenities for the country or stuff like that. Well, it still depends whether it's privatized or not. What percentage the the goal would be to lower the percentage of taxes people pay. So whether it's privatized or not, it doesn't matter. Right. What if the whole tax taxation is privatized? But what do you mean? Like, would people pay less taxes? So let's say if you privatize. Right? Like, so let's say if the country make profit out of this, eventually, it will lead to the the lessons of the tax. Right? Because if the economy grow, then the tax will go down. Well, it's it's unclear. Maybe if it's you know, we don't know. We have no idea. Like, you would have to have a plan to reduce taxes. So whether it's privatized or not doesn't really matter as much. It might be more of here's the problem with with taxes, and this is related to your question, is that the higher taxes are, the more people avoid taxes. The more people the more tax evasion there is is a big problem. Like, there's 1,000,000,000 every year, maybe 100 of 1,000,000,000 that are not collected in taxes because the higher taxes are, the more people avoid paying taxes either through some loopholes or just illegally. So the goal would be, again, privatized or not, the goal would be to reduce taxes so that the government actually can collect more taxes and maybe not lose so much money, and people don't have to spend as much on their taxes. So again when people don't spend as much on taxes they either buy things like food, shelter, technology, and so on, or they start companies and hire people and give people money by creating jobs. So let's just discuss I would say the big issue is how to reduce taxes. Oh, wait, Jay. You had a second question. No. That that's the only questions. Oh, okay. That was the only questions. The other one is like a silly like a throwback because the post office issue sort of, was in Seinfeld. I don't know if you remember. No. There was a Seinfeld episode where Kramer just goes around and says, let's stop using the post office. And we start using faxes and, and email instead. And then new Newman is like, Kramer, what are you doing here? You're you know, you're you're making me out of jobs or something like that. Yeah. No. It's funny. I mean, the post office used to be, like, one of the most reliable, places for a job. Like, it was total job security. You got a great pension. By the way, great book to read. Charles Bukowski's first novel called post office Right. About his life as a mailman, and it's a great novel. Alright. No based on his life. Now back to your, policy on taxes. Yes. So first off, how much does the government actually collect from taxes? So right now, like, last year, the government collected about 4 and a half $1,000,000,000,000 from income taxes, corporate taxes, payroll taxes, and estate taxes. So if you lower this amount, if you lower the amount peep of taxes that are collected, you have to somehow replace that amount. So 4 and a half trillion, keep that money money in your mind. That's how much we collect from income taxes, corporate taxes, payroll taxes, and estate taxes. Now how much does the government spend? We spend about $6,000,000,000,000 per year. So we borrow money every year, almost every year. There are a few years where we don't borrow money because the government's doing very well, but in general, the government spends about 6,000,000,000,000 dollars per year. Okay. Do you mind explaining how does government borrow money? Is it the same as printing money? No. The government can print money. We have the power to do that, but we have to be very careful about that because we're in a we printed a lot of money in 2020, and now we have inflation that's higher than it's been in a long time. But but the government just basically, the biggest lender of the government, I think, is China. Okay. So China lends the US a lot of money. So China has something like $2,000,000,000,000 of American money in our banks because you can't keep American dollars in other banks. And so China is the the biggest holder of US I think China probably has more dollars than the US has. So why does China buy dollars is because they were constantly buying American products, and they're also buying a lot of oil. And you have to buy oil with dollars. And, again, demand for the dollar is what keeps inflation down. But, again, we spend 6,000,000,000,000 a year. This is why the debt ceiling has to be raised all the time. Now how much do consumers spend? Consumers spend and this is very important. This is very important for because it's related to my solution. Consumer spending is about $16,000,000,000,000 per year, not counting home buying. So, look, we buy our iPhones, our iPads, our Teslas. So here's here's what my solution is is reduce taxes. Right now, taxes are about 30 to 40% depending on what your income bracket is, depending on how much you make. You pay about 30 to 40% in federal taxes and then sometimes up to another 15 or 16% in state and city taxes. I think it's the great economist 50 Cent who said that he doesn't earn a dollar of his own money for himself until September or or October every year because he pays federal New York State and New York City taxes up to, like, 70% almost. That's why he only had 50¢. That's why he only has 50¢. And he is a great economist. Like, no other economist just says it as simply as that. Like, Paul Krugman writes all these, like, 50,000 word articles about the economy that I can't understand, and then 50¢ just says something simple. I think he's called 50 Cent because he is a great economist, actually. Yeah. But that he he was first a a Nobel level economist, and then he'd be decided to become a rapper. Yeah. But so here's my solution. You reduce income taxes, and I'll say the exact numbers that I think work in a little bit. You reduce income taxes to a flat level. Let's just pretend for a second it's 10%. This is some some people have proposed reducing it to 0%, but I don't think that's realistic. There's a congressman in Georgia right now who basically is saying, get rid of the IRS, no income taxes at all, and make a 30% national sales tax. So when you buy, like, a newspaper for a dollar, you have to actually spend a dollar 30 because the sales tax would be 30%. And that would be much easier to collect. There's no loopholes to avoid the sales tax, and everybody just has to send their sales taxes in to the government. And so but I think that's a a little too high. 30% sales tax Right. I think that would make the prices of everything go up. It would feel like inflation. I don't think it would work. It seems too much. So I my goal is make a very small income tax, again let's say 10%, that's just standard for everyone so it's not complicated to calculate and it could practically eliminate IRS if you just simplify, like you don't charge for Social Security, you don't charge for FICA, all these weird little taxes that you have to pay in your paycheck, you just have 1 10% flat income tax and then make a 10% national sales tax. Now you just say to yourself, oh, I already pay sales taxes. Well, no. You don't pay any nationals. There's 0 national sales taxes. It's sales taxes are state taxes are state sales taxes. So you might have to pay if your state sales tax was 4 or 5%, now you have to pay 14%, but prices wouldn't necessarily rise since it's small enough. Let's just go over a few things. Some people say well that hurts the poor and adds to the rich because the poor, they spend their entire income on food, shelter, clothing, the things they need. When I say poor, I mean, you know, they make below a certain amount, you know, the average salary, so they'll have to spend a bigger portion of their income on sales taxes. But then again, they have to spend less on income taxes, but I have a a big solution for them. The solution is is that you get a rebate. Basically, the first $20,000 you consume, you get a rebate at the end of the year for all your sales taxes. So if the sales tax was 10% and you spent more than 20,000 a year, you would get $2,000 back at the end of the year. So you're not charged any sales tax at all, basically, for the first $20,000 you consume. So I think that makes it so that anybody making less than $50,000, they'll end up paying much less in taxes than they pay now. You know, would some people still benefit and some people not benefit? Sure. But this I think that solves 99% of the problem. The other thing is tourists, people who aren't US citizens, who we can't we we get no money the federal government gets no money from them because they don't pay US income taxes. Right. Tourists spend $1,100,000,000,000 per year in the US. So so now instead of getting instead of the federal government getting $0 from tourists, the federal government would get a $110,000,000,000 from tourists. So this would remove some of the burden of US taxes to foreigners who visit the US. Would this stop people from visiting the US? No. Of course not. Like, peep maybe more people would visit the US than ever because companies would have more money to spend, so they would create more advantages for tourists to come here and see the United States. Yeah. And 10% is not that big, to be honest. Right? No. I mean, particularly if you're not paying any as much income if your income tax goes from 40% to 10%, you have a lot more disposable income. So it's a huge, huge, huge cut. The other thing is now this is not a big amount compared to the federal budget of 6,000,000,000,000, but the IRS budget is about $200,000,000,000. They spent $200,000,000,000 collecting the 4 and a half $1,000,000,000,000 in income taxes because it's hard to collect and so many people there's so many loopholes and tax evasions they have to do, you know they're passing a law right now where they wanna, give $80,000,000,000 more to the IRS to hire more people to collect money. 80,000,000,000? Yeah. So my solution is just eliminate the IRS and save on all the money that's used to collect income taxes. Don't you still need some sort of body or some sort of some people to go for those to still try to avoid taxes or try to escape taxes? If there's a 10% flat income tax, there's almost no incentive. Okay. Right now, about 15% of taxes in this country are unpaid. People just don't pay or there's tax evasion or whatever. So that's equivalent to $600,000,000,000. So if if by reducing the income tax to 10%, people say, screw it. I'm not gonna go through the headache of trying to avoid taxes. I'll just pay. It's only 10%. You'll actually end up collecting, potentially collecting almost as much money from income taxes and collecting a lot more from this national sales tax. So that's why this hybrid tax, maybe you make it a 5% of flat tax and 10% national sales tax. This would again I don't know if it would collect 4 and a half trillion. We'll get to the numbers in a second, but it would drastically increase the number of doll here's the thing too about collecting taxes. It's not like the country has one level of income, and then we just collect the same amount every year. You wanna do things that grow the economy. It could be the case that doing a strategy like this grows the economy so fast that you end up collecting much more in taxes very quickly. Because, again, what grows faster? The tech industry or government? The tech industry grows much faster than government. So if you give more if you let companies that are entrepreneurial and are doing a lot of like, let's say health care companies are doing a lot of good for the world, tech companies doing a lot of good for the world, if you let them keep more of their money, they will hire more people, they will create more medicines, they will create more I mean, government doesn't create medicine, the companies create medicines. They'll create more, automation which improves productivity, which creates more industries and more jobs and more companies and so on. So you want them to you want the companies that grow the economy to retain more money because they are they are smarter at allocating money. Who would you rather allocate money? A smart allocator well known allocator like Warren Buffett or congress, which is, you know, I don't wanna call them corrupt, but they do everybody's got their own political agenda. They they all have what's called pork, which is they, you know, they try to get funding for their own districts. And so they, you know, the mon the money is not allocated in a rational way. It's not allocated in a market driven way. It's allocated in a very political agenda way. And, again, a lot of taxes are unpaid, so it's not like the income tax is that efficient. So personal income is something like $22,000,000,000,000, and corporate profits before taxes are something like 3,000,000,000,000. So $25,000,000,000,000, that's the number we use when we collect the 4 and a half trillion in taxes. Right. And that 4 and a half trillion is a big number. If society had an extra 4 or 3 and a half $1,000,000,000,000 to spend, so many jobs would be created, so many new things would be invented, so much more would be created every single year, that the economy would grow faster than ultimately, even if taxes were 10% or even lower, you'd end up making a lot more money. So a flat tax of 10% would generate about 2 and a half trillion. I mentioned there was 2 and a half trillion in profits, and income. So a flat tax of 10% would generate 2 and a half trillion. A national sales tax, I've call it 12 a half percent. Okay? It would create 2 trillion. So if you did that, it would completely create replace the 4 and a half $1,000,000,000,000. Now I know I said 12 and a half percent for a national sales tax. Okay. Make it 10%, and my assumption is the economy would grow so fast that you can either lower the national sales tax pretty quickly or you could lower the national income tax pretty quickly because the the the first benefit of reducing taxes is that people and companies would have more money, but then the second benefit is that they would spend more money. And when they spend money, that means businesses grow faster. Now don't be anti business because anti business is what hires all the jobs that everybody has. So there are more jobs would be created. The economy would grow faster than inflation, and all would be good instantly. So again and, again, by the way, we would put some of the burden on the tourists that visit the US, so that relieves the burden somewhat. Now here, again, let's say the lower tax rate plus a rebate. If you have a 12 and a half percent sales tax and you're letting people get money back for the first $20,000 they consume, that means the one purpose of a new IRS would be to give back $25100 per year to a family of 4 that needs the money to survive. So on average, people making up to from 0 to $200,000 per year would make more money, significantly more money, under this plan. There would be less headaches and stress and suicides and anxiety around tax season, which is happening right now. Everybody just paid their taxes April 15th. Corporations would hire more people. The economy would grow much faster, and if the economy grows faster, we could then reduce income taxes and sales taxes much more. So would this encourage people to spend less since prices paid would go up because of the sales tax? I don't think so because there would be higher take home pay. Yeah. People will spend more. Right? Like, I know if if that happened, I would definitely spend more because there's a lot of stuff that I wanna buy, or I might want a healthier food because it's it's crazy because it's so much more expensive to be healthy than go to a McDonald's or go to a Little Caesar's to buy pizza. Is that what you do? You go to Little Caesar's. That's a very particular pizza place. It is. Because I when I was in New York, right, New York is expensive. Right? So when I was in New York in Florida, I used to live across the street from Little Caesar's. And I was I had no money. I had no money even though my rent was like $600. But I still, like, you know, I just graduated. I have no income or whatsoever. I would go to Little Caesar's, Get a $10 pizza bundle for $10 to give you a large pizza, breadsticks, and a bottle of Pepsi. You know, I would ration my pizza for 3 days. So $10 for 6 meals, I would just eat pizza. 2 pizza per meal and some breadsticks. So 2 pizza per meal and 1 breadsticks. Yeah. Well, it's definitely like you see this. In poor neighborhoods, the rates of diabetes and obesity are much higher because, a, it's hard to get healthy food, like, they don't have whole foods or health food stores in in poor neighborhoods. You know, I think this I think this would solve a lot a lot of those issues as well. And again, speaking about areas with lower income, the first $20,000 gets rebated to you anyway, so you're not being charged at all anyway. The first $20,000 for anybody, including you, me, Jeff Bezos, and somebody who makes no income, the first $20,000 of consumption of your sales tax gets rebated to you. So, again, right now, there's a bill going through congress which would eliminate all income taxes and put a national sales tax of 30%, which also, by the way, would replace the 4 and a half $1,000,000,000,000 completely. But my gut tells me that 30% is too high. It just feels high. Yeah. A low flat income tax does we're we're used to income taxes. We don't mind we we're we'd be happy. We'd we'd do a dance in the streets if you made a an income tax of 10% instead of 30 or 40%. And because this is designed to make the economy grow, if the economy grows, you need to have fewer taxes so you could reduce that sales tax or income tax as you decide eventually anyway, maybe even in just a year or 2. Now the other thing you can do, you can either the economy can either make more money or the government could spend less. So the other thing I would do is spend less. Now the 2 biggest expenditures of the US government are social security and defense. Now I don't we need social security and we need defense, but let's just take a look for a second. Social Security, you know, kicks in. You you can opt to kick in your Social Security at the age of 62 years old, and 65 is usually when it starts. But when Social Security was developed in 1935, I mean, the average life expectancy was 8 years less 8 years lower than it is now. So it makes sense that the age and this is gonna be a very unpopular opinion, so it's probably why it's never been proposed. So maybe there's a way to do this, maybe there isn't a way, or or I'll get to that in a second. But my the initial proposal is don't let Social Security kick in at 62, started at the age of 70. Life expectancy has increased 8 years, so add 8 years to when Social Security kicks in. Isn't that what hap sorry. Isn't that what happened in Paris? Isn't that that's why the protest happened in Paris? Maybe. That makes sense. See, that's the thing. It's very unpopular decision, but here's how I would do it so there's no protest. Is, a, don't kick it in immediately. Have it phase in. So anybody who's, like, 50 years old right now, you know, you can argue I'm saying this because I'm over 50, but whatever. Make it any age, an arbitrary age. Pick an age where anybody above that age, there's no changes to when they can get Social Security. But if you're 25 years old now, okay, now you have to wait till 70 before you can get Social Security. Remember, you're not paying Social Security tax anymore in my plan. It's just a flat income tax. So someone who's 25 will say, okay. I'd rather have money make the money and save the money now than keep contributing to something for when I'm 70 years old. So younger people are gonna be more okay with this and won't protest. So we just have to phase in, and, we don't punish the people who've already been contributing so much to Social Security. If you do this, if you just raise the age by which people could take Social Security, you would save $800,000,000,000. Wow. That that's a huge number. So you go from 6,000,000,000,000 to 5,200,000,000,000 in spending. Now let's talk about defense. Reduce manpower, like, we're in we're in, like, a 100 countries. We have military bases, and obviously there are a lot of wars we could avoid and maybe we need to think a little bit about more about what wars we get involved in. Like, we were in Iraq for 18 years, in Afghanistan for 18 years, and it was just a disaster. Yeah. If you have a baby then, your kids will probably grown up as teenagers now. Actually, that's true. Molly was born the the month we invaded Iraq, and now she's, you know, an adult. So, but, anyway, you if you reduce manpower by 20%, and, again, all those people could easily find jobs in the private sector, particularly if the economy is growing. But you would basic or if you force our allies, which depend on our military budget, you know, like NATO is largely funded by the United States. You force allies to put some in the bill, you US could save about a trillion a year. So that gets us that actually those just doing those two things. And by the way, I'm just picking those things because they're the largest expenses, but you can start going line by line through the department of education, the department of agriculture, the department of, you know, housing and urban development, and on and on. Each each area has huge expenses that could be cut, But I'm just saying that those two things would reduce the federal budget enough that that the tax plan I'm proposing would completely feed the you know, you would you would not have a a a deficit every year like we have now. Now a deficit is not so bad if you could borrow money and print money. In fact, there's so much demand for US dollars. We don't mind lending money at 0% interest rates, particularly if there's a little bit of inflation. That means when people have to pay us back or that means when we have to pay back, sorry, when the US has to pay back, the money is worth less than when we borrowed it. So it's not so bad to have debt, by the way, if you're a country. It's different than individual debt where it's much more painful. Countries is better to have long term debt. So it means the government could actually spend more money in this plan, and spend it more wisely and then allocate it better. So, again but just those two initiatives, defense and Social Security, you could balance the budget. And in the tax plan with a 10% flat income tax and then a 10 to 12 a half percent national sales tax with the plan to bring it down as the economy grows, this would more people would have money in their pocket. There would be more jobs, more inventions. The economy will grow faster. The budget would be balanced. People would trust the US more as a reserve currency, you know, as a so that would keep inflation down. All these things. And this is the problem that is biggest on people's minds. If you ask anybody, a third of people say the the money in their bank account and their wallet is their biggest problem, you know, and then next is immigration at 11% compared to 33%. So this is this is the biggest problem facing this country, and yet we do nothing every single year. We do nothing at all to solve it. We spend more money. We tax more people. Poor the rich, by the way, don't get taxed. Like, yes, Elon Musk says he's paid the most taxes of any individual in history, but in general, like, someone like Warren Buffett, he doesn't really make an income. He keeps his money in stocks, you only get taxed when you sell the stocks. Now someone like AOC who's has the worst knowledge of the economy of anybody on the planet and by the way she is perhaps the greatest politician on the planet because she's used her voice so powerfully at such a young age. She's she's so talented at that, but she is literally the worst person in the planet for understanding the economy. She thinks you could tax when unrealized gains, meaning, let's say, Jay, you own Apple stock and it goes up. Even if you don't sell it, you should get taxed. Well, what if it goes down next year? You don't get your money back. So you that's why they only tax when you sell the stock. But people like AOC are proposing you tax unrealized gains. That's called unrealized gains when you don't sell it and you're still taxed. That's ridiculous. That would destroy the economy because nobody would then be interested in funding. The the whole reason for the stock market is not for gamblers to make money, but it's for companies to to have incentive and potentially raise money to fund more hiring more people, starting new companies, inventing new products, and online. That's the reason for a stock exchange, hedging risk and so on. So so you can't just use everything people people are trying to hire more people and embed more things because there's incentives to do that and you can't do that if you're constantly fighting with people who wanna tax every little single little thing you do. So so the system I proposed, a, it would keep more money in people's pocket, it's the biggest problem in in the country and nobody is trying to solve it except in these ridiculous ways like a 30% national sales tax, which is going in the right direction but just as a weird crazy way to do it and they know it's not gonna pass anyway so that's why they're proposing it. My system is more rational. It keeps an income tax and introduces a sales tax, and it has rebates. It's not a regressive tax. It doesn't hurt just the lower income versus higher income. And if on top of it, you reduce spending in these very obvious ways, but might not be politically, you know, satisfying, you would balance the budget. And, again, I describe the Social Security in a way that would be politically satisfying. Like, just don't hurt people who have already paid Social Security taxes because they're expecting it at 62. Pick an age. I don't care what age. Anyway, that is the first and most important issue. I would deal with it. I don't think anyone's ever proposed a hybrid sales income tax like I'm doing. Like, why not? I'm just curious. Why not? Because people take extremes. And also because peep there are I would say a good 30% of the country is probably, like, has the economic knowledge of an AOC. She she represents the worst of the worst in terms of economic knowledge. And then there's a whole group of people who think higher taxes are good because the government is good. But you have to ask yourself, how is the government spending the money? Do you approve of how the government is spending the money? Like, Jeff Bezos is not everyone's favorite billionaire, but he created the largest store in the world that all of us use every day and it helped the world so much during the pandemic and it's created so many jobs and it's it's also created side hustles and more income for tens of millions of people. Like forget about Jeff Bezos. Don't be don't somebody very smart told me, don't ever look at what in someone what's in someone else's wallet. Look at what's in your wallet, and let's just focus on making your wallet fatter and bigger. And don't worry so much about the people who are inventing the new economy. And every year is a new economy, so don't hurt those people and just ask yourself, would you rather, you know, smart, creative, entrepreneurial people allocate the money? And, of course, we would, you know, keep all the law enforcement, no corruption, nothing illegal, regulate industries if you need to, but don't inhibit the most creative people in the economy and give money to the post office. The you know, nothing against the post office. I'm just using it as an example, but don't give it to the least creative bureaucrats in the country. Give it to the creatives to figure out how to grow the economy, and it'll work. That this plan will just work. And every dollar that the government doesn't spend is spent in private industry, and that's what keeps people alive. So that's it. That's policy number 1. Probably the most important. It's so important. You don't even need practically any other policy. Okay? Now, you know, you could look at immigration in the context of will it help grow the economy or not. Now you have to also be, you know, humanitarian and and help people who work hard in this country and, you know, who came in legally. You have to really think about all the nuances on the illegal immigration. It's a very complicated issue. You know, there's a lot of issues that are are much smaller in people's minds that are very complicated and very nuanced. This one is so big and so important and yet nobody deals with it, and that's what's disturbing to me. And that's why this country could fail is because no one's dealing with it. Like, right now, we're solving higher inflation by raising interest rates so much that it's gonna cause a recession. That's not the way to solve this problem. But, anyway, that's all I have to say about this issue. Altitude 2024. Let's go. Make it not a joke. Make it real. But, you know, for now, it's a joke. But the issues are real. Yeah. And if anyone has more questions to ask James, go to jamesoutitureshow.com/askoutiture. You will greeted by a Google form, and then just, you know, input your your questions, and then we will answer it. Or you could tweet it. Just tweet it at j altiture. Like, follow me and then tweet the at j altiture, and I'll I'll be able to see it. This is a good one. Yeah. And would I be a I can't be any I can't hold any government positions, can I? Yeah. You could hold everything except, president and vice president. Oh, maybe I would be, vice speaker of house or whatever. You could, or that's hard because you have to get elected. I'll just appoint you like a supreme court justice. That's it. You know, you don't have you don't even have to be a lawyer. You don't have to be a lawyer to be a Supreme Court justice. Is there any Asian Supreme Court justice? I don't think so. Because they're they're I don't think there's ever been an Asian supreme court. I think you need to be on the supreme court, Jay. You're a very fair person. I'm pretty fair. I'm I you know, if if I have a dollar, I would give someone a 50¢, another one 50¢. Yeah. Even on the federal judges on the US Court of Appeals, only 10 are Asian Americans, and there's no Asian who's ever been Supreme court. Supreme court. Not? Or People like, hey. You know, we have to have diversity and equality. And also, there's so many good benefit to have an Asian Supreme Court justice. Right? Like the great comedian Ronny Chieng said one time, if you have an Asian president, we work for you guys on Christmas. We even cook for you guys on Christmas. Yeah. Ronnie Chang, very funny. C h I e n g. I highly recommend everybody listen to his stuff. So alright, Jay. Thanks so much for organizing this podcast, and until next time. There's a lot of great questions that are left to be answered by in the Ask Altitude queue. Thank you so much, James, and have a wonderful day.