Two visions

If you want to understand what this election is about, all you have to do is look at the proposals we received yesterday from two very different politicians, Barack Obama and Tom Emmer.

Obama offers a $50 billion plan to build infrastructure:

"Today, I am announcing a new plan for rebuilding and modernizing America's roads, and rails and runways for the long term," said Obama, who spoke on Labor Day in Milwaukee, Wisconsin -- a state with competitive gubernatorial and U.S. Senate races.

"We used to have the best infrastructure in the world. We can have it again," he said to loud cheers from a crowd of union workers.

The proposal envisions -- over a six year period -- rebuilding 150,000 miles of roads, 4,000 miles of rail and 150 miles of airport runways. It also would include modernizing the nation's air traffic control system in an effort to reduce delays and travel time.

Hmmm. I thought we had done all that already -- given the number of signs I've seen in my travels this summer, touting the traffic jams caused by construction sites that almost invariably had no one working on them at the time, one could draw that assumption. But hey, what's another $50 billion, right?

Meanwhile, Tom Emmer, running for the office of governor in Minnesota, offers an idea to reduce the tax burden on the private sector. Mitch Berg provides a summary, with helpful explanations of the rationale behind Emmer's proposals:

Emmer is going to…:

Lower The Corporate Income Tax. This will enable new businesses to get profitable faster, and allow large companies to stay that way – forestalling layoffs, enabling job additions, and addressing business’ #1 complaint about doing business in Minnesota, our top-in-the-nation business and corporate tax rates.

Increase The “Angel” Investor Credit. “Angel” investors - people who are willing to take long shots on new companies that don’t yet have established sales, assets or revenues. They are what get new companies off the ground, and allow them to survive and make payroll until they turn a profit – are in many ways the lynchpin of the new economy. Of all “new economies”, really. Angel Investors were the underpinning of much of the high-tech revolution that transformed our economy, and our lives really, for the past fifty years. Currently, investors can deduct 25% of their investment (up to $125,000 from a $500,000 investment); Tom Emmer will increase that credit.

Accelerate The Refunds From The Sales Tax Exemption On Capital Purchases. Minnesota allows a refund of sales taxes on capital equipment – in
the tax cycle after the equipment is purchased. Emmer will front-load that – essentially lopping sales taxes off of capital equipment, making it easier – 7% easier – for companies to buy the equipment they need, when they need it to be easiser, when they buy the equipment; freeing up 7-and-change-percent of the company’s revenue to do more important things – like hire people.

The Obama approach keeps the power in the hands of the government. The Emmer approach frees private sector entities to take chances and build something new. We have a clear choice in this election.