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Independent Institute Senior Fellow William F. Shughart II‘s new article, “We must cut taxes, curb spending and crimp regulations,” is being syndicated by McClatchy-Tribune Information Services to newspapers across the United States and Canada, including the Sacramento Bee, Lexington Herald-Leader, Standard Times (Bedford, MA), Bellingham Herald, Albany Times-Union, Guelph Mercury, Kitchener Record, etc.
“The failure of Keynesian pump-priming seems to be lost on recent White House occupants. George W. Bush twice tried to stimulate the economy, once after 9/11 and again in the early days of the recent financial crisis
. . . .
“President Barack Obama has tried more of the same—with no greater success.
. . . .
“Economic activity remains moribund, as it did during the Great Depression, because President Obama’s policies, like those of President Franklin D. Roosevelt before him, are working at cross-purposes.
“While FDR was pumping huge amounts of money into government to finance the New Deal, he was simultaneously increasing federal income tax rates, adding new payroll taxes to fund Social Security, enacting minimum wage laws, and saddling the economy with other measures that raised the cost of doing business for those who otherwise might have employed the unemployed.
“Today, President Obama also is combining “stimulus” with tax increases: putting one foot on an out-of-control government accelerator and the other on the brake. Allowing the so-called Bush tax cuts to expire alone would amount to one of the largest tax increases in history.
“On top of this are the costs of the new national healthcare regime, the recently enacted financial market “reforms,” and talk of a new value-added tax, similar to a national sales tax.
. . . .
“The only sure way to perk up the job market is to cut taxes permanently and rein in public spending and excessive regulation. This would encourage the private sector to start hiring again. It would also help stanch the unacceptable flow of red ink.”