Lawmakers have recently paid lip service to cutting the corporate tax rate to help boost economic growth. Doing so would be good policy, but it’s important to know why. Information disseminated by both political parties, think tanks, government organizations, media outlets, and political pundits has confused the issue, leading many to believe that reducing the corporate tax rate would have little effect on the economy. This is because most discussion surrounding the utility of tax cuts is filtered primarily through the “demand-side” lens—that is, it views tax cuts as effective …
If you’re following the evolving terms of the budget debate, the hip new phrase is “new revenues.” It sounds so much cooler than “tax increases.” Both parties are massaging their rhetoric in the debt ceiling fight, and the media are using the phrase “new revenues” to describe proposals to reduce the U.S. deficit. Samples: Washington Post blogger Greg Sargent tweeted, “Can someone please settle the question of whether GOP is also saying No to new revenues?” Reuters reported that Senator Max Baucus (D–MT) “said new revenues had to be part …
The Keynesian policy of trying to increase total i.e. “aggregate” demand – either by having government spend, or by cutting taxes just to leave more money in people’s pockets in hopes that they’ll spend – to revive the economy, never works. The latest installment of Keynesian failure is the payroll tax cut. Predictably, like its predecessors, this “stimulus,” which aimed at putting money in people’s pockets, failed. The economy was unmoved, and indeed appears now to be slowing again, as today’s bleak jobs report underscores. This wasn’t the first time Keynesian …
One month ago today, millions of Americans voted to reject big-government and the backroom deals that defined the Obama presidency. Now, some of the same Senate Republicans who rode that momentum to electoral victory appear to be on the verge of ignoring that message by striking a deal to trade passage of the dangerous New START treaty for an extension of the current tax rates. To be crystal clear, we will view any deal on the extension of the current tax rates followed by Senate consideration of the New START …
Today’s New York Times editorial on President Obama’s Cleveland political diatribe-cum-economic speech got one point right — Obama “took too long to engage this debate.” The rest of the editorial was little more than an epilogue to Obama’s political speech. One can see why the Times would avoid talking about the economic substance of the speech, the debate to which the president is so tardy: because there was precious little in the speech to talk about, despite an economy showing “widespread signs of a deceleration,” according to the Federal Reserve’s authoritative Beige Book. …
Faced with predictions of staggering losses for his party in November’s midterm elections, President Barack Obama today appeared on ABC’s “Good Morning America” and said, “If the election is a referendum on ‘are people satisfied about the economy as it currently is,’ then we’re not going to do well, because I think everybody feels like this economy needs to do better than it’s been doing.” The prospect of that referendum is casting a long shadow over Washington as the President and candidates alike wrestle with America’s frustration over a still-stagnant …
Alan Greenspan recently gave a Bloomberg News interview with Judy Woodruff. His agenda was redemption. Hers was politics. She got what she wanted. In the course of the interview, Greenspan acknowledged the economy was slowing, a more modest appraisal than that recently signaled by his former colleagues at the Fed who see a significant chance of a downturn and deflation. He also acknowledged that “this is not going to be a full-blown recovery.” He noted one reason for the weak recovery is that “an ever-increasing part of the American economy …
Carnegie Mellon University economics professor and American Enterprise Institute visiting scholar Allan Meltzer has a must read op-ed in today’s Wall Street Journal titled: Why Obamanomics Has Failed: Uncertainty about future taxes and regulations is enemy No. 1 of economic growth. It is re-posted in its entirety below but as an added bonus we have added links supporting many of his factual and theoretical claims: The administration’s stimulus program has failed. Growth is slow and unemployment remains high. The president, his friends and advisers talk endlessly about the circumstances they …
Earlier this year, after Congress passed an increase in the debt ceiling, was deliberating over a trillion plus health care package, and the President’s Budget promised new record deficits, the American people started to see a worrisome trend that pushed fiscal responsibility to the forefront of the public’s priorities. President Obama responded by creating the National Commission on Fiscal Responsibility and Reform, a bipartisan commission tasked with submitting a solution to the nation’s fiscal woes by the end of the year. Problem solved, right?
Tomorrow is the one-year anniversary of the American Recovery and Reinvestment Act, or as it is more accurately described, President Barack Obama’s Failed Stimulus. When President Obama signed the now $862 billion deficit-spending bill into law, the unemployment rate stood at 7.6% and the U.S. economy employed 133.5 million people. At the time President Obama promised the American people that, thanks to his stimulus, unemployment would never go higher than 8.2% and the U.S. economy would support 138.6 million jobs by December 2010. At the one year mark unemployment is …
