Ditch the flawed case for lower taxes and less regulation.

Ronald Reagan rode into the White House on this horse.  Our federal debt, however, soared under his reigns. Under President Bill Clinton, labeled a “tax and spend liberal,” we achieved the first federal government surpluses in the memory of most living Americans.  Then George W. declared a new war on taxes and regulations.  His legacy: the worst recession since the Great Depression.  Today, Kansas faces an economic crisis because of another misguided trip down this road. Gov. Brownback slashed taxes to stimulate economic growth.  The results?  Its rate of growth now significantly trails the national average, revenues have shriveled up, government spending is being slashed, and Brownback’s political career is over.

So why do politicians continue to tout lower taxes?  Why do they continue to condemn “big government?”  Why does anyone criticize sensible government regulation in the wake of the economic debacle after Wall Street financiers were turned loose to create new and toxic “investment” products in the last decade?

The answer may lie in the fact that economics are complicated and widely misunderstood while simple statements are inviting.  It’s easy for politicians to persuade people to vote against their own self interests.   George W. argued for lower taxes saying it was our money and we knew better than the government how to use it.  The Koch brothers, Carl Rove and friends argue today that lower taxes for “job creators” stimulates the economy.   But any economist will tell you that the most significant driver of economic growth is consumer spending, followed closely by government spending.  Investment does not lead spending.  It follows spending.  The person ahead of you in the check-out line is driving growth, not the Kochs. 

It’s time to give those in the highest income brackets a turn at paying their fair share rather than cutting public spending on education to reduce their taxes.  Not many politicians have the courage to make that case, but they should.  Gubernatorial candidate Jack Hatch made just such a recommendation in his first televised debate against incumbent Iowa Governor Terry Branstad.  Their relative standing in recent polls suggests that his wisdom fell on deaf ears, but it’s not too late for Iowa voters to wake up and realize that they should vote for candidates like Hatch who are willing to give government a chance to work.  Let’s support those willing to provide government with sufficient revenues, for a change, by restoring the progressive tax rates that worked so well for us in the past.  In the 1950s, when marginal tax rates were in the stratosphere, people still went to work.  They still consumed food, clothing and shelter.  They still invested in businesses.  It worked just fine.  We should try it again.