Amity Shlaes writes in the Wall Street Journal about the dangers of a New Deal-style spending program that emphasizes temporary job creation and other exploding-deficit stimulus packages by the next administration. Shlaes has written a well-received scholarly book about the Great Depression and the New Deal, The Forgotten Man: A New History of the Great Depression. Artificially high wages and high taxes make for high unemployment, as the statistics from the 1930s show. While you may have a job, and a not badly-paying one at that, companies cannot afford to hire and may have to lay off workers. This keeps unemployment unnecessarily high. High taxes inhibit capital formation. Of course, if taxes aren’t raised, and the deficit is allowed to balloon, that raises its own serious dangers of dollar collapse and at least “real” inflation.
“The facts of life are conservative.” - Margaret Thatcher
Recent Articles
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NPR and the “tyranny of constituency”
I have been re-reading quite a few of the Federalist Papers for the constitutingamerica.org project and for a summer class I am teaching on the Foundations of the Constitution. A recurrent theme therein is the…
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Daily Briefing 06/26/10
First Alvin Greene in South Carolina; now this. A Congressional candidate in Texas wants to impeach President Obama and, during the campaign, carried an oversized picture of the President with a Hitler-style moustache. Obviously, this is the type…
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Laugh it off!
Iowahawk’s occasional guest columnist T. Coddington Van Voorhees VII returns, somewhat chastened over his earlier gushing and fawning over Barack Obama. “Each day seems to introduce some new crisis on the world scene with hint…
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Alexander Hamilton on tax policy
Why are certain basic economic proposition known to everyone but Democratic (and unacceptably many Republican) politicians? Here is Alexander Hamilton, writing more than two hundred years ago about the usefulness and limitations of consumption taxes. Hi…
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Daily Briefing 06/24/10
The Supreme Court has unanimously decided three federal “honest services” fraud cases by (rightly) limiting such cases to bribery and kickbacks, as intended by Congress when the law was drafted, rather than the more…