Interesting perspectives

[audtatious]

* In just eight years, U.S. federal spending has ballooned from $2 trillion to $3 trillion—a 50 percent increase at a time when the average private income increased only 28 percent

* At 35 percent, the United States now has the second-highest corporate profits tax in the world—absolute insanity in a time of intense global competition when Congress should be doing everything in its power to help domestic employers compete against foreign companies.

* At a time when formerly communist countries in central and eastern Europe have adopted flat-rate personal income taxes less than 20 percent, and are booming as a result, the United States clings to an outdated Marxian, growth-retarding, class-warfare, graduated income tax, and at least one presidential candidate wants to raise those rates even more.

* Last fall, Congress decided that financial institutions were making too large a profit on student loans, so they mandated lower returns on such loans. As a result, many private lenders have dropped out of the student loan market entirely, and Congress is now trying to bail out such lenders by empowering the Department of Education to purchase student loans directly from private lenders. Where will the Department of Education come up with the necessary funds? From higher tax revenues, of course.

* Congress recently passed a $307-billion farm-subsidy bill. President Bush tried to get Congress to limit subsidies to those making no more than $200,000 per year, but Congress rejected that proposal, paving the way for subsidies to those with annual incomes over $2 million. Some senators solemnly intoned that they were doing this to prevent bankruptcies. Apart from the fact that the centuries-old trend is toward fewer agricultural producers (i.e., farm bankruptcies) as a result of improved efficiencies and economies of scale, and in spite of the fact that many farm prices are at multi-year highs, we should ask why Congress, instead of the marketplace, should decide which businesses survive and which do not? Central planning, anyone?

* Congress’ recent denunciation of private oil producers include comments that perhaps Congress should “socialize” these companies, or at least increase taxes on them. Apparently, some members of Congress subscribe to the school of thought popularized by that eminent political philosopher, Jane Fonda, who has long felt that the cure for Big Oil’s alleged oligopoly is to create a federal monopoly. Does anybody seriously believe that monopolies are good for consumers? And another question: if Congress confiscates more profits from Big Oil, who will make up the resulting reduction in spending on discovering and developing oil reserves?

* Congress is currently working on a multi-trillion-dollar plan to impose a cap-and-trade system on carbon dioxide emissions. The Wall Street Journal and others have already explained what a colossal boondoggle this would be, but the fundamental question is this: Why, at a time of record energy costs that are imposing great hardship on many Americans, does our government want to make the use of hydrocarbon energy sources even more costly?

- Dr. Mark W. Hendrickson is a faculty member, economist, and contributing scholar with the Center for Vision and Values at Grove City College