Change You Can't Believe In!
Change You Canât Believe In!
To the Editor:
As a follow-up to my 2/20/09 letter, âChange We Can Believe In?,â I want to reiterate my opposition to reckless Democratic spending, evidenced by their $787 billion âstimulusâ bill, a supplemental $410 billion earmark-laden spending bill, and a proposed $3.5 trillion budget that increases spending to nearly 35 percent of GDP (versus the historical average of around 20 percent) pushing the deficit to $1.75 trillion, or roughly 12 percent of GDP, levels not seen since WWII. Again, is this the hope and change people expected â unprecedented wasteful spending, higher taxes, long-term multitrillion-dollar deficits, and European-style socialism which will prove impossible to pay for in the years ahead for my children and future generations??
Richard Englishâs 2/27/09 rebuttal, âFlawed Argument,â exposes his lack of understanding of basic economic theory and the events that led us here. He finds it curious that my major concern is that Obama is leading us down a path of failed economic policy, known as Keynesianism. Instead of Googling âWhat is Keynesian Economics?â I suggest he study the consequences of this theory as it relates to fighting recessions. He may find it disheartening, and not label my concern a ânice conservative sound bite.â
However, rather than debate complex macroeconomic policies, Iâll address some of his âflawedâ assertions. Firstly, all deficits are not created alike. He correctly asserts Reagan ran up the deficit in the 1980s. However, overspending, not his pro-growth initiatives, including tax cuts, led to deficits. In fact, tax revenue surged under Reagan, but Democratic compromise prevented him from achieving his balance budget initiatives â a regret he later acknowledged. His pro-growth policies, though, launched a 25-year period of economic prosperity which was instrumental in creating Clintonâs surplus. Moreover, unlike Reagan, Clinton had a Republican-led Congress to control spending.
Secondly, he incorrectly asserts Bushâs deficits were caused by tax cuts for the âwealthy.â In contrast, a large drop in tax revenue from the tech-induced recession, and 9/11, reversed Clintonâs surplus. Bushâs tax cuts for everyone brought in record revenue, spurring the economy; unfortunately, both Republicans and Democrats recklessly overspent, prolonging the deficit! Deficits are caused by declines in tax revenue induced by recessions and/or overspending in good times and bad, not lower taxes â a salient point Mr English doesnât understand. Interestingly, one former President did comprehend this: âEvery dollar released from taxation that is spent or invested will help create a new job, and a new salary. And these new jobs and new salaries can create other jobs and other salaries, and more customers and more growth, for an expanding American economy.â âJohn F. Kennedy, August 13, 1962. Yes, Obama inherited the worst economic crisis since 1980, but there are better, proven ways to combat it. A history of cutting taxes â beginning in the 1920s, followed by Kennedy, Reagan and Bush â led to higher revenues and improved economic growth.
Lastly, whether Iâm for or against deficits is irrelevant. Like most Americans, Iâm for fiscal responsibility, less government, low taxes and free markets â the necessary ingredients to fix this crisis!
31 Russett Road, Sandy HookÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â March 2, 2009