Posted on 02/15/2013 6:03:41 AM PST by Kaslin
By far the best line from this weeks dueling State of the Union messages came from Florida senator Marco Rubio. Nice and simple, and right to the point:
Presidents in both parties -- from John F. Kennedy to Ronald Reagan -- have known that our free-enterprise economy is the source of our middle-class prosperity.
Thats a brilliant summary of pro-growth policies, on the supply-side and in a free-market context.
Kennedy slashed tax rates and held down the budget. So did Ronald Reagan, who borrowed Kennedys ideas: smaller government, lower tax-rate incentives, and a thriving middle class, where the economic pie grows ever larger.
In short, the Kennedy-Reagan policies were growth policies.
On the other hand, while President Obama quotes John F. Kennedy, he doesnt draw the dots to Kennedys supply-side tax reforms. He does mention the phrase tax reform, but hes not talking about lowering rates across the board while broadening the base to reduce deductions. Rather, he means penalizing companies that operate overseas and favoring companies at home that do what he wants them to do.
Think of it as taxation as a form of industrial policy, replete with tax targeting. This is decidedly anti-growth. And while opposing the sequester spending cut, Obama wants another $800 billion in taxes. More anti-growth.
Even with my low expectations for the speech, I had hoped President Obama would follow through on his occasional pledge for corporate tax reform. But he didnt. As a result, he missed a great growth opportunity. In fact, the presidents State of the Union message had no growth elements at all. No growth message in a precarious economic recovery that is averaging 2 percent, grew only 1.4 percent last year, and actually contracted in the fourth quarter.
Wheres the growth, Mr. President?
He could have proposed lowering business tax rates from 35 percent (really 40 percent when you figure in the states) to 25 percent. He could have suggested that small businesses, now paying 40 percent, be made eligible to become C-corps, so that their tax rates also drop to 25 percent. He could have proposed repatriating roughly $1.5 trillion of corporate profits overseas, bringing them back home with a tax holiday, or even better, a permanently lower rate. Doing so would be like putting free money into our domestic economy for new investment and job creation.
But he didnt do it. Instead he wants to penalize companies operating overseas and somehow reward manufacturers who create jobs at home.
But what exactly is a manufacturer? Define it, Mr. President. And does Obama actually think he can overturn the entire interrelated global economy? I dont think so.
Former Obama economist Austan Goolsbee tells me again and again that the president is for a full-fledged tax reform. Well, youd never know it from his latest State of the Union message.
Instead of real tax reform, we got an incredible array of government intervention, spending, and regulating: More green energy. More housing subsidies. Another $50 billion for infrastructure. A higher minimum wage. Manufacturing hubs. And more money for the education unions, where the compensation goes up and school scores go down.
It was a liberal wish list that will expand the government reach deeper into the private economy and society.
You know, if this stuff would have worked to promote growth over the past four years, well, it would have already worked. But obviously it hasnt worked, given the weakest recovery in modern times going back to 1947.
Obama even threatened Congress with a new Energy Security Trust, funded by taxing oil and gas companies. He also pushed for climate-change legislation, along the lines of Lieberman-McCain cap-and-trade (and tax). Failing that, hell unleash the EPA -- which means energy costs will skyrocket and the coal industry will be destroyed.
And where was the Keystone pipeline, Mr. President? Thats an easy growth- and job-creating measure. And what about high-tech drilling and fracking for natural gas on federal lands? Another easy growth- and job-creating policy.
No, this was not a growth speech. This was a government-planning speech. And it was completely unlike the growth message delivered by Senator Rubio.
Heres one more from Rubio: Raising taxes wont create private-sector jobs. And theres no realistic tax increase that could lower our deficits by almost $4 trillion. Thats why I hope the president will abandon his obsession with raising taxes and instead work with us to achieve real growth in our economy.
Rubio delivered an economic primer on the quest for life, liberty, and the pursuit of happiness. President Obama outlined his scheme for government collective action to transform the country into his liberal progressive vision. Its a wonderment that a freshman senator can get the story so right, while a second-term president can get it all wrong.
Maybe Limbaugh is right, they will never hold him accountable - for anything.
I'll wager they continue to support Dear Leader even while they are lined up in front of a ditch.
Prior to his SOTU speech, did Obama file a FINANCIAL IMPACT STATEMENT ?
State of the Union = ICU
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.