4. Hold the line on taxes. Given the massive federal deficits, there is little prospect for any tax cuts that might contribute significantly to economic recovery. Even if there were, such a program would likely not be comprehensible to the public. Consequently, the emphasis must be on deregulation as the key strategy for enabling economic growth. At the same time, however, economy-depressing tax increases must be avoided. In particular, now that the issue of general income-tax rates has been settled, ideologues associated with the Democratic party are advancing proposals for collecting new government revenue through carbon taxes. These need to be opposed not just as efforts to continue to fund the cancerous growth of economy-strangling government bureaucracy (which they are) but as ultra-regressive measures that place a disproportionate burden on the poor, the working class, the middle class, and businesses that produce real things. Carbon taxes are much more regressive even than sales taxes, because high-priced prestige items, such as high-fashion dresses, generally involve no more carbon in their production than their low-priced counterparts. Furthermore, while sellers of junk stock or real-estate derivatives need use no carbon, those who make their money producing steel, food, plastics, paper, fabrics, cars, airplanes, buildings, or energy — in short, nearly everything making up the material basis of society — do indeed use carbon. In short, there could be no worse taxes than carbon taxes, nor any better means conceivable by which to harm the economy and the average American.
Barack Obama claims that his policy of reckless deficit spending is the key to growth. Nothing could be more false. While it is true that federal spending on technological research and development can significantly assist economic growth in both the near and long term, it is precisely such funding that has been put in danger by the administration’s profligate waste elsewhere. For example, the $535 million the administration chose to give away to the president’s campaign supporters at Solyndra exceeds by 30 percent the entire $400 million FY 2012 budget for U.S. research into controlled fusion. And Solyndra is just the tip of the iceberg. According to the detailed and itemized exposé presented by Peter Schweizer in his book Throw Them All Out, under Obama over $16 billion in federal cash that could have been used to fund important energy research was given away in scandalous kickbacks to companies either run or primarily owned by “individuals who were bundlers, members of Obama’s National Finance Committee, or large donors to the Democratic Party.” Federal research into new advanced technologies, particularly in energy, can and should be expanded, but not at the expense of the taxpayers. Instead, Congress should cut off the gravy train to the president’s profiteering followers, who have diverted the required funds from their proper purpose.
In any case, the central issue is not research but the freedom to use technology — new or old — to create wealth. At every turn, the administration’s policy is to restrict such freedom, thereby constricting the nation’s potential for economic growth. Such a “limits to growth” strategy is not just an attack on enterprising businessmen. It is a betrayal of the hopes of all, but most particularly the poor, who counted on Obama to lead them to the Promised Land. The president says he wants to raise the minimum wage, but at the same time he is destroying the capacity of the economy to pay higher wages. The pressing need facing the poor is not to have the wages of entry-level positions raised to $9 per hour, but to have many more real job opportunities that pay $25 per hour. That is what is needed for working-class families to support themselves in dignity, and that is precisely what Obama’s program would deny. Limits to growth means limits to hope.
Our policy must be the exact opposite. Growth is the tide that lifts all boats. Growth is the program that opens all doors. Growth is the magic that gives all hopes their chance to become real.
Growth must be our cause.
– Robert Zubrin is president of Pioneer Energy, a senior fellow with the Center for Security Policy, and the author of Energy Victory: Winning the War on Terror by Breaking Free of Oil. His newest book, Merchants of Despair: Radical Environmentalists, Criminal Pseudo-Scientists, and the Fatal Cult of Antihumanism, was recently published by Encounter Books.