Leave it to mini-Marxists George W. Bush, Henry Paulson, and Ben Bernanke to saddle American taxpayers with $8.35 trillion in bailout commitments, yet not spend one thin dime on incentives to revive the U.S. economy. In fact, the faintest echo of an incentive these days is not a Reaganite act of commission, but a Reagan-lite act of omission. Barack Obama — rated in January as the Senate’s most liberal member — seems to have side-stepped his statist ways long enough to scuttle his speedy end to Bush’s first-term tax cuts on upper incomes. Obama reportedly will let them expire naturally in 2011 rather than euthanize them in 2009. The Tax Foundation estimates this will leave $100 billion in private hands, where it will do some good.
It is outrageous that a nominally Republican administration, even in its dying days, would fight a financial crisis with every socialist gun blazing and not fire even one bullet in the name of supply-side tax reduction, regulatory relief, litigation reform, or anything else that would stimulate private-sector risk taking. How sad (and oddly encouraging) that only Obama — not the self-styled heirs of Ronald Reagan — has bothered to consider tax-hike repeal as one cure for the current unpleasantness.
To marvel at the bailout’s sheer scope, look for a while at the nearby chart from the November 30 New York Post. Chicago economist James Bianco compared major federal expenditures throughout U.S. history and adjusted them for inflation to today’s dollars. Bianco low-balls the bailout’s total price tag at $1.5 trillion (vs. the $8,349,120,000,000 in commitments and $3,147,120,000,000 in actual outlays that the Washington Post reported November 25). But even by that measure, the bailout already stands at thrice the cost of the New Deal alone! (For a detailed bailout breakdown, click here.)
Now that the Bush Administration has devolved into a sad, spent shell, Obama would be wise to embrace and promote these and similar incentives for Americans to work, save, invest, and produce:
Turbocharge innovation by letting anyone granted a new patent enjoy the revenues it generates for, say, five years tax-free. Watch inventors from Google to garages across America trip over themselves to create new products while Uncle Sam leaves them unmolested for half a decade.
Offer “Emerald Cards” to the planet’s 6.7 million non–North American millionaires. Without closing the Golden Door to those less fortunate, these high-end Green Cards would go instantly to any successful, law-abiding immigrant who could deposit $1 million in a U.S. bank, open a business, and hire at least five employees. One million such millionaires would pump $1 trillion into America’s economy and create 5 million jobs.