by Stephen Moore • The Washington Post
It was 40 years ago this month that two of President Gerald Ford’s top White House advisers, Dick Cheney and Don Rumsfeld, gathered for a steak dinner at the Two Continents restaurant in Washington with Wall Street Journal editorial writer Jude Wanniski and Arthur Laffer, former chief economist at the Office of Management and Budget. The United States was in the grip of a gut-wrenching recession, and Laffer lectured to his dinner companions that the federal government’s 70 percent marginal tax rates were an economic toll booth slowing growth to a crawl.
To punctuate his point, he grabbed a pen and a cloth cocktail napkin and drew a chart showing that when tax rates get too high, they penalize work and investment and can actually lead to revenue losses for the government. Four years later, that napkin became immortalized as “the Laffer Curve” in an article Wanniski wrote for the Public Interest magazine. (Wanniski would later grouse only half-jokingly that he should have called it the Wanniski Curve.) Continue reading
How often have you heard a Democrat prattle on and on about how well Barack Obama has done with the economy, given the mess he inherited? Usually, it’s some version of, “Things are getting better, but the economy the President started with was so awful, so he’s done as well as anyone could expect.”
When Ronald Reagan took over from Jimmy Carter in ’81, things were actually worse economically compared to when Obama took over from George W. Bush in ’08. Continue reading
While the 2000s may have been a lost decade for the American dream, a revival of our model’s advantages is still a real, worth-desiring possibility.
Because it was tax day recently, because he mentions me and because I’m easily provoked, below the quote you’ll find three rejoinders to Jonathan Cohn’s admirably forthright argument that American society would be much better off if most of us were writing larger considerably larger checks to Uncle Sam:
Maybe you don’t like tax day … [because] it reminds you of how high taxes are—and you think that, because of those high taxes, the economy grows more slowly. That would mean fewer jobs and less pay for you—and the country as a whole. It’s not a crazy argument … But the evidence for this point of view turns out to be thinner than you’ve probably heard. Relative to other countries, tax rates in the U.S. are relatively low, even when you throw in local and state taxes and add them to federal levies. Overall, according to the Tax Policy Center and Center on Budget and Policy Priorities … taxes in the U.S. are among the lowest in the developed world. The average for countries in the Organization for Economic Cooperation and Development, an organization of rich countries, is higher. And in countries like Sweden, Norway, and the Netherlands countries, the average is much higher. In those nations, taxes account for more than half of total national income. Continue reading
Our corporate tax rates are far too high. The rate kills investment and job creation and it makes us less competitive with other nations who have had the good sense to lower their tax rates. Germany has cut its rates almost in half in the last 25 years. Socialist Sweden has cut its by more than one half. And Ireland has cut its rates by almost 75%. We, on the other hand, have raised our corporate tax rates over that time period — leaving us with the highest rates in the industrialized world.
It is no coincidence that our unemployment rate is historically high and our labor participation rate is historically low. It is also no coincidence that our economic growth rate is painfully slow and far too low.
We realize that there will not be any meaningful tax reform or lowering of the tax rates this year. But the idea that the Senate Finance Committee might consider extending some legitimate tax deductions for manufacturing that actually make profits and employ people, but killing others means that the Senate plans to raise taxes on some american corporations at a time when the economy is weak, employment numbers are bad and taxes are already too high. This is bad policy! Continue reading
While October numbers show auto sales continuing on their path to pre-recession levels of 15.5 million annually, the good news should not be read as an indicator of the overall strength of the economy. The country can’t rely on one industry to aid its lackluster recovery. Rather, tax reform and deregulation must be priorities for long-term growth.
A new Michigan economic study finds that the implementation of the Affordable Care Act will be a drag on the economy next year. Small businesses have resisted hiring under the uncertainty of Obamacare’s costs, and consumers are feeling the shock of higher health care premiums and canceled policies entering the holiday buying season. That’s not what the economy needs.
In the fourth year of sluggish growth, the twin federal policies of increased regulation and stimulus spending have brought diminishing returns. Continue reading
I am here today because I believe the public policy status quo in Washington – and in particular, within the Republican Party – must once again be challenged and transformed. The focus of my remarks will be the new tax reform proposal I will soon be introducing in the Senate.
But before I get into the specifics of the legislation, I think it’s important to explain the problem it has been designed to solve.
On this Constitution Day, allow me to begin with thoughts from perhaps the two most important constitutionalists in American history. The first, from James Madison, is that the “object of government,” is “the happiness of the people.” The second, from Abraham Lincoln, is that the role of government is: “…to lift artificial weights from all shoulders, to clear the paths of laudable pursuit for all, to afford all an unfettered start and a fair chance in the race of life.” Continue reading
“This whole controversy: Are you entitled to the fruits of your own labor or does government have some presumptive right to spend and spend and spend?”
by Scott L. Vanatter
Ronald Reagan is well known for his multi-decade devotion America’s purpose and promise. By returning to these lofty ideas America would fulfill its destiny.
His July 27, 1981 speech was President Reagan’s main public effort to educate the nation on the benefits of a bipartisan bill to cut taxes and spending. He taught America, once again, how and why cutting taxes and spending (cutting the rate of growth of government spending) would make for a stronger economy — and help restore America’s latent greatness.
It was Reagan’s habit to speak on large themes. In this particular case he used a two-letter word to illustrate one of the largest of political themes. He stated that the people in electing him wanted to make a change from ‘by’ to ‘of.’ Succinctly put, “It doesn’t sound like much, but it sure can make a difference changing by government,’ ‘control by government’ to ‘control of government.’” Continue reading