Skip to comments.Jason Lewis: There are better economic tools in the box
Posted on 01/26/2008 3:21:01 AM PST by rhema
What we need is more production -- real production. And what encourages that is permanent tax reduction.
In any economy, growth is a function of people and productivity. An increase of labor or capital will always result in higher levels of output. Unfortunately, the stimulus package being fast-tracked by Washington these days provides little incentive for increasing either.
One would have thought by now that the mere escalation of government transfer payments -- whether in the form of rebates (the key element of a tentative agreement announced Thursday) or larger food-stamp and unemployment checks (a Democratic idea that's out of the plan for now) -- would be seen for what it is: an old-fashioned Keynesian attempt to inflate the economy without increases in real production.
Of course, in the case of tax rebates, it's always a good idea when government returns money to its rightful owner. But this can only be done if rebates are matched with spending cuts. Otherwise, government simply taxes (or borrows from) one set of individuals in order to subsidize another, as in the Democratic plan denying rebates to taxpayers earning more than $85,000 per year. Moreover, no one is suggesting the $140 billion scheme be paid for. So much for the deficit. It's the spending that counts anyway, whether part of it is financed by borrowing or not. And in this way, not all deficits are alike. Those that come from spending increases are bad; those temporary deficits that result from permanent tax reduction are generally quite harmless.
Permanent tax reduction rewards both labor and capital; government spending does not. No doubt, federal borrowing diverts capital from more productive uses in the private sector, but taxes are worse. While they consume scarce resources, just like deficits, they also crowd out labor by reducing its rate
(Excerpt) Read more at startribune.com ...
The Strib’s op-ed staff holds its collective nose, suppresses its gag reflex, and prints a Jason Lewis editorial.
Give us your poor -- if you can find them. Dig into the numbers, and poverty doesn't look as bad as the gloomier among us say it is.
You mean printing money does not create wealth?
First, Mr. Bush should call for a substantial and permanent cut in both capital-gains and personal-income tax rates.
Next, he should insist on a large reduction in federal spending, including elimination of all agricultural subsidies. While he's showing such courage, he might as well unconditionally endorse free trade.
Cutting taxes is, of course, a good thing, but it's important to know why. The goal would not be to increase consumer spending. Instead, it would be to raise the returns on investment and work.
By letting investors and workers keep more of the fruits of their risk-taking, creativity, and efforts, the economy will enjoy more risk-taking, creativity, and effort. Businesses that would otherwise not be started would be created. Likewise with machinery and training that increases worker productivity. Investors worldwide would flock to take advantage of these lower tax rates, further increasing productive investments.
Cutting government spending would result in more of the economy's resources being used by wealth-creating businesses rather than being siphoned away to special-interest groups and boondoggles such as bridges-to-nowhere and Woodstock museums.
Committing to free trade would assure global investors that Americans refuse to turn inward that producers in America will not be stymied in their efforts to buy inputs from low-cost foreign suppliers and that investments and entrepreneurial ideas from abroad will continue to be welcomed.
Finally, Bush should assure the Board of Governors of the Federal Reserve that he neither expects nor wants them to use monetary policy politically. Reminding them of the wisdom of Milton Friedman, he should strongly urge them to keep a tight rein on the money supply.
Sound money, low taxes, and free trade might not "stimulate" the economy today, but this combination will surely increase its vigor over the long-run.
These tax rebates have nothing to do with economics, and everything to do with election-year politics.
Yeah, but how much am I going to get? ;-)
I’d like to see Jason Lewis sub for Limbaugh 1-2 times a week from now on. I’ve been getting a little burned out on Rush lately and Lewis is like a breath of fresh air.
In the meantime, though, Jason's fans in the other 49 states can listen online as many Minnesotans do.
He says this like there's some doubt it won't happen. I don't know of one Dimocrat who has said they wouldn't let the cuts lapse. Hillary is on record as saying: "The more fortunate may have to sacrifice so the less fortunate may benefit." This whole concept of rewarding non-productive members of society at the expense of the productive sector has my whitey-tidies in a knot. Giving out $800 to people who make less than $85,000 is a case in point. My feeling is that, if you paid more than $800 in federal taxes, you can have the $800 back. If you didn't pay that much, you don't get anything. And I would have no upper income cutoff. It's the people making more than $85,000 who create jobs and make this economic engine work, but almost every gov't plan seems to be one that penalizes hard work. Come on, GOP, be the champions of the sector that makes your job possible...the business sector.
sssshhhhhhh!!! Don't tell anybody. We wants our $$$$$
This silly stimulus package seems to be the latest attempt to increase aggregate demand at the expense of long-term saving. Government’s task should be to encourage the factors of production, not to hand out checks in the hopes that someone might still produce something in spite of diminishing investment and incentive.
What’s really had the markets spooked lately is the ominous specter of massive tax increases on the horizon if the 2003 tax cuts are allowed to expire, which would wipe out any stimulus-package relief in the span of a few months.
Great election year gimmick to show deficit spending isn’t going to end the world, now let’s outlaw double digit tax rates.
Well, Jason didn't throw a wet blanket on that idea, either: "Of course, in the case of tax rebates, it's always a good idea when government returns money to its rightful owner."
You've got it all wrong. People making more than $85,000 per year are the gun-toting white racist oppressors who are destroying our country. They have to be stopped. Unless they're government or non-profit employees making that kind of money.
/brain damaged Marxist DU rant
It goes over well with the "gimme" crowd so they will vote demoncrat. No permanent fix so next election cycle the dims can do it again.
Lewis is really good until he loses his temper and starts yelling at the callers and calling them stupid dolts.
For a huge percentage of the Democrat base, the opposite is true.
[American Chesterton Society president Dale Ahlquist's view of why and how conservatives should fight: excerpted from "A Decade of Deep Delight," an editorial in, and commemorating the 10th anniversary of, Gilbert Magazine, the publication of The American Chesterton Society.]
. . "By being devoted to Chesterton and his ideas, we have often faced the accusation -- as did the man himself -- of being narrow or of being on the fringe. But our defense is the same as his: we are not eccentric. We represent the central ideas of civilization: family, faith, and friendship. The normal and human ideals remain birth instead of contraception or abortion; natural death instead of suicide or physician-assisted murder; marriage instead of a revolving door of divorce or homosexual mockery; freedom instead of coercion; self-government instead of Big Government; taking care of one's own property instead of taking care of someone else's property; science as a tool or a toy instead of a materialistic philosophy; education as truth passed from one generation to another instead of as state-sponsored indoctrination; beauty instead of ugliness; tradition instead of faddism; laughter instead of sneering; hope instead of despair, and finally, faith in God and Christ instead of endless doubt, relativistic tolerance, or nirvana.
"These normal things are worth fighting for. And one of the things we have learned in our own battles is that fighting is fun. Fighting does not mean one cannot be courteous. But courtesy does not mean praising the errors of our opponents or celebrating the defeat of everything we believe in. Courtesy means treating our opponents with respect despite our disagreement, and maintaining the fight with them because their victory would mean even worse things for them than for us. We fight as a matter of charity.
"We fight the feminization of the culture that tries to suppress fighting. We fight the mechanization of the culture that tries to suppress creativity. We fight the sexualization of the culture that tries to suppress creation itself. We fight the secularization of the culture that tries to suppress the Creator.
"And sometimes we may even fight you. Sometimes you might disagree with us. We hope on those rare occasions that you will stay and argue rather than run away. Come, let us reason together. 'Always arguing, never quarreling.' " . . .
Really? And your evidence is...what?