Jeffrey L. Scribner at American Thinker presents a radical, crazy, almost unheard of plan for economic recovery: cut spending and lower taxes. Unlike the current plan of the Obama administration to spend the nation into debt to save it economically, cutting spending and reducing taxes actually makes sense, and has actually been effective in he past – every time it has been employed.
A Radical Recovery Proposal
We cannot go on and on with deficit spending. We are already at the point where we cannot tax our way out of the debt trap, and even with a relatively robust recovery, the current level of government spending will still create deficits. There is only one way out that prevents monetizing the debt and creating inflation that will make us a banana republic: Drastic cuts in spending.
The misguided Keynesian-style, prime-the-pump approach hasn’t worked. The current recession has lasted too long and caused too much trouble for most of us (and untold misery for some). Recessions as corrections for bubbles and other artificial inputs to economic performance need not be long, drawn-out affairs.
Drastically reduced government spending and lower taxes would leave money in the economy in private hands (remember that even now, a large proportion of the workforce, approaching 90%, is gainfully employed) that will take advantage of the deflating housing and other bubbles when the excesses have been wrung from them. Whatever asset-deflation there is would happen quickly rather than slowly. Stability would come faster, and recovery would take place sooner. This would benefit the economy as a whole and the large majority of the people. It would also raise tax receipts sooner without enacting any new taxes.