The Economic Imperative

THE post—September 11 spirit of bi-partisanship was suddenly shattered during a House Ways and Means Committee meeting, when Republicans suggested a capital-gains tax cut as an emergency economic stimulus. Charlie Rangel of New York, the ranking Democrat on the committee, embarked on a fist-pounding tirade denouncing the Republicans for exploiting the tragedy of terrorism to advance their “right-wing tax-cutting agenda.” A few days later, John Spratt, the ranking Democrat on the House Budget Committee, lambasted the capital-gains discussion as “unconscionable” in a time of national crisis. Senate majority leader Tom Daschle piled on, advising the White House not to cave in to the “extreme voices” advocating a “divisive approach” to the stimulus bill. Translation: Even in a plunging economy, congressional Democrats will never abandon their quasi-religious opposition to capital-gains cuts.

Unfortunately, to preserve the veneer of bipartisanship, the White House has succumbed to these tirades. President Bush’s economic advisers have always— inexplicably—been unenthusiastic about capital-gains cuts anyway, so the passionate opposition by liberal Democrats has convinced the Bush political team that it’s now doubly wise to shelve the idea. In a meeting with investment icon Charles Schwab, Treasury secretary Paul O’Neill rebuffed Schwab’s plea for a capital-gains cut, calling it a “deal-breaker.” But it’s only a deal-breaker because the Bush economic team, representing a president with an 85 percent approval rating, refuses to endorse the idea.

About the Author

Stephen Moore

Stephen Moore is a co-founder of Unleash Prosperity, a senior visiting fellow at the Heritage Foundation, and a senior economic adviser to the Trump campaign.

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THE post—September 11 spirit of bi-partisanship was suddenly shattered during a House Ways and Means Committee meeting, when Republicans suggested a capital-gains tax cut as an emergency economic stimulus. Charlie Rangel of New York, the ranking Democrat on the committee, embarked on a fist-pounding tirade denouncing the Republicans for exploiting the tragedy of terrorism to advance their “right-wing tax-cutting agenda.” A few days later, John Spratt, the ranking Democrat on the House Budget Committee, lambasted the capital-gains discussion as “unconscionable” in a time of national crisis. Senate majority leader Tom Daschle piled on, advising the White House not to cave in to the “extreme voices” advocating a “divisive approach” to the stimulus bill. Translation: Even in a plunging economy, congressional Democrats will never abandon their quasi-religious opposition to capital-gains cuts.

Unfortunately, to preserve the veneer of bipartisanship, the White House has succumbed to these tirades. President Bush’s economic advisers have always— inexplicably—been unenthusiastic about capital-gains cuts anyway, so the passionate opposition by liberal Democrats has convinced the Bush political team that it’s now doubly wise to shelve the idea. In a meeting with investment icon Charles Schwab, Treasury secretary Paul O’Neill rebuffed Schwab’s plea for a capital-gains cut, calling it a “deal-breaker.” But it’s only a deal-breaker because the Bush economic team, representing a president with an 85 percent approval rating, refuses to endorse the idea.

About the Author

Stephen Moore

Stephen Moore is a co-founder of Unleash Prosperity, a senior visiting fellow at the Heritage Foundation, and a senior economic adviser to the Trump campaign.