A temporary fix cannot begin to compare with the lasting results of meaningful permanent tax reductions
by Rense Johnson, Chairman
Citizens for Term Limits … for a fresh Congress!
December 4, 2008
When Congress meets for a lame duck session, Rep. Louie Gohmert will introduce his solution to the bailout mess. Gohmert proposes to use the $350 billion left of the $700 billion bank bailout to fund a two-month tax holiday.
Such a scheme can be compared to taking two months “time out” during a war — in this case a life and death struggle for the lasting benefits of meaningful permanent tax reductions, while at the same time going deeper in debt to the tune of an additional $350 Billion to American taxpayers. The life and death struggle is for the continued existence of our nation.
Recently we published an article titled It’s all right there on the record: Tax cuts bring prosperity. In retrospect, we might have found a catchier title. Or not. The point is that tax cuts reduce unemployment by creating jobs, putting people to work, while restoring the self-respect of those who are restored to employment.
Quoting from the Coolidge Foundation Report: “By 1930, there was a sharp increase in the number of Americans who could afford what were then middle class luxuries such as ranges, ice boxes, radios, vacuum cleaners and other household appliances.”
Meaning: A boom for the manufacturers of — guess what? Those same ranges, ice boxes, radios, vacuum cleaners and other household appliances. And the jobs created in their manufacture. It is no wonder that unemployment was reduced in the 1920s to 3.3% [see below].
Also from the Coolidge Foundation Report:
The American people were the beneficiaries of the unprecedented prosperity of the 1920’s. Unemployment was pared from its high in 1921 of 20% to an average of 3.3% for the remainder of the decade. The misery index which is a combination of unemployment and inflation had its sharpest decline in U.S. history under President Harding. The Gross National Product [growth] averaged 7% from 1924 to 1929. Wages, profits, and productivity all made substantial gains during the 1920’s. Harding slashed federal spending by two billion from Wilson’s last year and Coolidge maintained that spending level of 3.3 billion per year for the rest of the decade. The Harding-Coolidge tax cuts produced increased revenue that went to cut the national debt left by Wilson by one-third.
Within the foreseeable future, the Harding-Coolidge cure can happen again.
But it must be accompanied by reduced congressional spending, under presidential leadership, something that President George W. Bush could never bring himself to do.
[President-elect Obama, call your office.]
That means getting rid of the Devil-may-care spending habits of the careerist-dominated Congress we have. These must be replaced with public servants, who go to Washington to serve their neighbors and their nation instead of serving themselves, at the lasting expense of our children’s future. That requires a constitutional amendment limiting congressional terms.
This choice is not even a choice.
It is an imperative, if we are to get our children, grandchildren and their unborn issue out from under the burden of a debt, now in the area of Eighty Trillion Dollars or more.
To accomplish this, we have the blue print before us. We must begin our battle for the future of our youngsters with meaningful tax reduction.
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