Anyone who has a stake in exponentially restoring and growing our economy needs to read Peter Ferrara’s truly excellent piece The Timeless Principles of American Prosperity. And I truly mean that: read the whole article. It will crystallize history of the last one-hundred years with amazing clarity.
Without reiterating the wealth of factual support cited in the piece, the most significant area that emerges is the idea that true prosperity-proven policies have not been instituted since the Reagan era. The boom we saw in the 1990s was a farcical facade that disguised the dangerous bubble-and-bust cycle that has held us hostage in the last two decades. And that when all the factors Ferrara mentions are implemented, the economy time after time has soared. Republicans today need to be clear: real tax reform and real economic policies were not encompassed in George W. Bush’s presidency.
Throughout history, a simple combination of monetary regulation and tax policies have emerged that have proven time and time again to grow the American economy, generate wealth, and create private sector jobs. The Bush tax cuts were only one part of this amazing combination, but they were unfortunately paired with bad regulatory and monetary policies that led to the lethal crash of 2008. Instead of solving the rest of the equation and changing these regulatory and monetary policies, Obama has moved the country further and further from the solution itself. As a true believer in Keynesian economics, the Obama administration sees this solution as false, and instead has doubled down on the destructive redistributive policies of The Wilson, Roosevelt and Carter eras of the past. Yes, the administration has issues with the policies of these presidencies, but only because Obama believes they did not go far enough. In the mind of the current administration, Keynesian economics have only failed because they were not instituted in a large enough way. That the resulting failure in creating prosperity was that the government did not spend enough taxpayer money. As a result, we are now seeing levels of spending and debt that would make even Keynes turn in his grave.
So instead of instituting tried-and-true policies that would fairly quickly reform our economy and create jobs for millions of out-of-work Americans, the Obama administration is making the dangerous bet that the government–which runs and operates on the backs and wallets of the taxpayer–can somehow create wealth and grow the economy. That an entity that creates nothing by its very nature can somehow create wealth. This misguided sentiment, emerging mainly from an ideology that wealth must be spread to the poorest among us, is at best a stagnating force holding the American economy hostage with the chains of uncertainty.
The last twenty years have been a confounding era. for some reason, we have now reached a point when people in power believe that the most equalizing and moral force in this world is the government. That only the government can ensure a fair and equal life for the American people. This is simply untrue. After the financial crisis, when individuals in this nation acted with no sense of responsibility or restraint, I can see how it may be difficult for many to have lost faith in their neighbors and in American entrepreneurs. But what we need, now more than ever before in our history, is to unleash the ingenuity of American minds on this world. We need to put faith in the idea that people above all want to succeed and improve their lives, and in doing so will improve ours as well. We need to implement a set of policies that not only stabilize our monetary system, but also cut taxes across the board (most importantly on capital gains). We need to stop regulating based on ideology, which only leads businesses to act in ways that are not directly connected to their natural success, but rather regulate only where absolutely necessary. When people have faith in our currency, when businesses feel inspired to go out and risk their own capital (with the true, present threat that they may fail), when entrepreneurs act only in the interest of growing and expanding their business to make money, not to placate the farcical ideologies of politicians seeking re-election, will our economy take off so that the quality of life of all Americans will improve.
I can see how some may be concerned about transferring power from the government to the American entrepreneur. Our current system of government boosting up certain companies that act in their own interest can only inflate these fears. But this is crony capitalism, not true capitalism. Government needs to have no hand in the success and failure of business. “Risk” needs to truly return to being Risk, and not a pale assurance that an administration will protect a company from having to face the consequences of their actions.
So we are left with only one rope out of this hole that has left us nearly six feet under. To move forward, we must have faith in one another, and allow the only entity that has the possibility of growing to do just that: the private sector.