Tax and Spend
Jul 07, 2009
We have a long list of serious problems that the President and Congress need to address. Pointing fingers and blaming President Bush won’t fix anything. If the politicians would spend more time doing their job and less time passing the blame, we might be able to find some answers. The American public is smart enough to know that we got in the mess we are in today because of many mistakes made by many politicians – Members of Congress and former Presidents – both parties.
Here is how I see the situation. We have an economy in recession with unemployment over 9 percent. We are providing a big shot of stimulus. Will it help? We all hope so.
At the same time, we have a budget deficit of more than a trillion dollars. It’s twice as large as any President Bush ever had. Most economists would say deficits of that size are not sustainable.
A side bar problem is that our entitlement programs of Social Security, Medicare, and Medicaid are going broke, and that just makes the deficit situation much worse.
Under these dire conditions, wouldn’t it be wise to not dream up some new big spending plans – like wild new healthcare spending? Sure, we do need to control the costs associated with healthcare. I don’t think most Members of Congress are really serious. Since they are beholden to the trial lawyers, they are unwilling to cap health-related lawsuits. How much do you think doctors have to pay for insurance? Try 100,000 dollars. Try 300,000 dollars. Doctors are so afraid of being sued that they order all kinds of extra tests for their patients, running up the costs. We do need to cut the escalating cost of healthcare, but spending another trillion dollars is going in the wrong direction.
Another priority for Congress and the President is the Cap and Trade bill. Everyone has to acknowledge that it is effectively a big tax increase. A big tax increase will serve as a heavy drag on our weakened economy.
I would like to remind everyone that in the early 80s, we experienced unemployment of 10.8 percent. The unemployment rate in my home county of Knox County, Illinois was 15.8 percent.
President Reagan didn’t raise taxes. He cut taxes. President Reagan didn’t announce big spending entitlement programs. He cut spending. He cut regulation. He expanded trade.
For some reason, the Reagan policies worked to lift us out of recession. Why do we think doing the opposite is the best idea today?
Until next week, I am John Block from Washington, D.C.