The Deficit Reduction Trap

By Dick Bishirjian

This is a warning to those in Congress who want to raise taxes, not cut spending. In 1984, Cong. Newt Gingrich called Sen. Bob Dole, a “tax collector for the welfare state.” That phrase resonated with the Republican faithful and ultimately led to GOP control of the House of Representatives. The “Contract for America” was the culmination of years of labor by supply-side advocates who argued that dropping tax rates would lead to economic growth. The supply-side movement had its day and now the U.S. faces budget deficits - and Obama Administration’s regulatory policies - that threaten to destabilize the American economy, reduce employment and increase inflation to levels that led to the collapse of the Weimar Republic and launched Adolph Hitler’s murderous career. [more…]