From the US Chamber of Commerce:
U.S. Chamber of Commerce President Tom Donohue warned the U.S. faces a double-dip recession because of the taxes and regulations under consideration by the Democratic Congress and President Barack Obama.
“Congress, the administration and states must recognize that our weak economy simply could not sustain all the new taxes, regulations and mandates now under consideration. It’s a sure-fire recipe for a double-dip recession, or worse,” Donohue said in a speech providing the Chamber’s outlook for 2010.
It is my contention, of course, that we haven’t really emerged from the recession. GDP numbers don’t impress me – its all smoke and mirrors fueled by fiat money and accounting which makes Enron look honest. Be that as it may, the facts are ever more clear – Obama’s policies not only aren’t helping,they are making things worse.
The big hits to come this year – ARM mortgages, commercial real estate collapse, likely stock market bubble burst, etc – will be capped off by the fact that the Bush Administration tax cuts will expire at the end of the year. Unless Obama and the Democrats decide to renew the cuts, we’re in for a massive tax increase on what is, at best, an economy in weak recovery. Even the most dyed-in-the-wool Keynsians will tell you this is bad policy – but Democrats are unlikely to move on it because they love the idea of a tax hike they don’t have to actually vote on (though we GOPers simply must find a way to hang this on them – there’s no excuse for inaction).
We need policies which will encourage wealth creation. What that means is not just tax cuts, but regulatory reform to make it easier for people to start or expand farms, factories and mines. We can’t build our economy on windmills, road maintenance and government bureaucrats. We need to actually make money – and that means making, mining and growing things.
Here’s just one idea to get things rolling – in Detroit, there are vast swaths of city land unused. Using eminent domain, the federal government should seize the land (thus taking it out of Detroit’s impossible tax and regulatory environment) and offer it, as it were, under a form of “Homestead Act” to anyone who will start a business on the land – and tax free for the first ten years. This would cost only a trivial amount (the land to be seized in Detroit is largely abandoned and those parts which have an identifiable owner would be compensated at, let’s face it, fire sale prices); it would not require the destruction of any farm or wild lands; it would encourage business formation and expansion right here in the United States (perhaps even with foreign money coming in to open up business which will be non-union and temporarily tax free, ya dig?) and it would provide jobs in one of the worst hit areas of the United States. And it would create wealth where none exists today – and thus, in the long run, provide far more tax revenue than the land is currently generating.
Is this idea the cure-all for what ails us? By no means – its just something I thought of. The point is that we have to think anew and act anew. The tired, old statist policies of liberalism won’t work. And we need leaders who are willing to try any idea provided the cost is little or nothing and the driving force would be the creative effort of regular folks. Do this, and we can get out of our economic mess – do otherwise, and we’ll be sitting here 10 and 20 years from now in the same condition.
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