Monday, July 30, 2012
I said this a year ago...and here we sit caught in the frozen years.
Tax reform is the one sure fire thing that could release us from this fettered and festering sewer we are in economically. John Kennedy did it and we had the second longest expansion ever. Ronald Reagan did it and we had the third longest expansion ever. The president assigned a commission, his commission, that told him he should do it too. What did he do? He appointed another commission. Throw in what the NLRB is doing to Boeing and you should not wonder why we are where we are.
I think we should get out the ax and hack to death every deduction you can think of, and I mean every one of them. Corporate jets, sky boxes at the Bears game, three martini lunches, home interest, charitable deductions, and on and on. Then slam the marginal rate as low as we can on both corporate and personal income. Doing something to increase the efficiency of the allocation of resources and the incentive to work and invest on the margin is the best thing we could possibly do at the moment. Instead I hear about temporary tax cuts which are economic nonsense for thinking they will help growth. More targeted spending and unemployment benefits. Why not let people decide for themselves instead of picking winners and losers?
Not interested. And that's why we will be here, same spot, one year from now.
I said in 2008 that I was in for a "lost half decade" of economic growth. I am ready to make my bet for a "lost decade" just like the Japanese. God help us.