Posted on January 26, 2009
You can tell that the Democrats are now in charge. In their view, any stimulus package should include millions of dollars for contraceptives buried in money for unemployment insurance and food stamps. As Speaker Nancy Pelosi put it on George Stephanapolous’s show yesterday, “you get back more bang for the buck” for that kind of spending.
Talk about bang for the buck. The worry is that it will be the taxpayers who will get screwed in the long run. Most of the money from this so-called stimulus will go to states and local governments, not to job creators in the private sector.
There is no evidence that these politicians will spend the money very efficiently on job creation. Think Rod Blagojevich. What will Hot Rod or his successor do with billions of dollars in federal largesse? Probably give it to their cronies or campaign contributors, not to successful businesses.
Republicans keep talking about additional tax cuts, and while they make a compelling case, it is falling on deaf ears. Most Americans don’t pay that much in taxes, and they certainly don’t have sympathy for wealthy Americans who seemingly got us in this mess to begin with.
I have a different idea. Instead of tax cuts, Republicans should talk about tax certainty. A whole batch of tax rates are slated to go back up in less than two years. Included in that bunch are the death tax, taxes on dividends and capital, and taxes on research and development. Nothing bothers small and medium businesses more than uncertainty, especially when it comes to the tax code.
While most Americans know that, like death, taxes are certain, they don’t know how much they will pay because of the political dynamics of the new leadership in Washington. For example, Nancy Pelosi has said that she wants to raise taxes on the rich (better known as the job creators). How much better it would be for the business sector if they knew that their taxes wouldn’t go up dramatically in the next couple of years! How many more jobs would be created because these entrepreneurs could count on their tax rate being a certain, low rate? That would give the job creators more certainty in the they have money in the bank to hire new workers.
Nancy Pelosi has a different idea. She wants to give out condoms so kids can get busy, while raising taxes so business can stay quiet. My worry is that future taxpayers will ultimately be the ones who really get screwed.