New Year's resolutions for President Bush
By W. James Antle III
Typically, one makes New Year's resolutions for themselves rather than for others. But since I already know I am too fat, drink too much beer and don't attend church services enough, I say nuts to that. President-elect George W. Bush is going to have a tough year ahead of him and he ought to have a few New Year's resolutions to guide him.
First, Bush needs to resolve to fulfill his campaign promise on taxes. The economy is slowing and he can ill afford to be the second Bush president in a decade to preside over a recession. Reducing marginal income tax rates across the board will increase incentives to work, save and produce. His tax plan can increase after-tax incomes sufficiently to raise incentives by 12 per cent, yielding greater productivity throughout the economy. The economy-wide marginal tax rate is fast approaching 30 per cent, compared to 21 per cent during the Reagan years. Gross tax receipts are climbing to record levels and soaking astonishing amounts of money from the national GDP. This drag on the wealth-producing private sector must be lifted.
In addition to the unprecedented peacetime tax burden and the coming economic contraction, the budget surpluses are the direct result of the American people's hard work. The American people who create the wealth and own the money that comprises the federal budget should thus be compensated by the return of these surpluses to them in the form of tax cuts.
The private sector spends a dollar far more efficiently than the public sector, thus far too much of our nation's wealth is being squandered due to the amount of money in government hands. Restoring this money to the private sector will encourage capital formation, job creation, business expansion, entrepreneurship, technological innovation and economic growth that will raise the living standards of nearly all Americans. If we want to continue to experience the high-tech boom of the Internet economy and see a flourishing Investor Class with rapid income growth, marginal income tax rate reduction is critical.
Bush will need to compromise. He may not get the precise tax cut he wants from this divided Congress. Ronald Reagan ran on a 30 per cent across-the-board marginal rate reduction during the 1980 campaign, lifted verbatim from the 1978 Kemp-Roth bill, and ended up scaling this back to a 25 per cent rate cut in his 1981 Economic Recovery Act. Income taxes were not indexed to inflation, thus obviating CPI-induced bracket creep, until 1985. The Reagan tax cuts still triggered a fantastic economic boom, adding the equivalent of West Germany's economy to our GDP, increasing per capita income by 18 per cent, creating 21 million net new jobs and 4.5 million new businesses and tripling the rate of manufacturing productivity growth. The economy has grown 97 per cent of the time since their enactment, compared to two-thirds of the time historically.
Reagan's tax cuts remain the largest in history, to date saving taxpayers $2.5 trillion and still adding incentives to the economy. Bush has the opportunity to follow suit, igniting the economic activity that followed the Harding-Coolidge tax cuts of the 1920s, the Kennedy-Johnson tax cuts of the 1960s, the Reagan tax cuts of the 1980s and even the Clinton-Gingrich tax cuts (with the capital gains rate reduction yielding the greatest pro-growth effect) of 1997. We are at the point where an "insurance policy" against recession desperately needs to be adopted and pro-growth measures to get the economy back on track are advisable.
At the very least, Bush should be able to roll back the indefensible marriage penalty and gut the estate tax. Even the indefatigably liberal Rep. Charles Rangel (D-NY) favors a lower tax rate. Bush should heed Steve Forbes' dictum of "no taxation without respiration" while working for a tax cut that unites supply-siders and pro-family activists, two key parts of the conservative coalition. Both are tax cuts with strong bipartisan appeal that would have become law but for Clinton vetoes.
Further evidence that bipartisanship need not entail surrenders to the left can be found on that vexing abortion issue. Bush must resolve to win passage of the partial-birth abortion ban, thereby criminalizing a procedure Hillary Rodham Clinton's Democratic predecessor (the estimable Daniel Patrick Moynihan) rightly called "three-fourths infanticide." Members of the Democratic leadership in both houses of Congress, including Thomas Daschle, David Bonoir and Patrick Kennedy voted to ban partial-birth abortions. This is a Clinton veto that under Bush can become law.
Republicans should also revive the Born Alive Infants Protection Act, to clarify whether the law protects children who survive abortion attempts. There have been many reports that they are often killed by neglect or direct acts, with the legality of these circumstances made even less clear by the Supreme Court's abominable Stenberg v Cathcart decision. Gianna Jessen is among the survivors who have provided eloquent testimony on their behalf. Retired Rep. Charles Canady's (R-Fla.) bill should pass and Bush should sign it.
Obviously, the nation's most divisive social issues should not take the forefront of the beleaguered Bush administration. The new president should work to bring about free-market reform of Social Security and health care, mindful of the fact that Democrats will be unlikely to offer sufficient cooperation to produce a legislative achievement. In particular, Bush should work with high-profile Democrats like John Breaux and Joseph Lieberman, who have in the past endorsed Social Security reforms along the lines of his own plans. The objective should be to be bolder and more proactive than the Clinton administration on Social Security and other entitlements, even if it doesn't immediately lead to a legislative victory. The goal should be to demonstrate his commitment to reform and build public support transferring payroll tax revenues to personal investment accounts. This will contribute to bipartisan support - or possible Republican congressional gains - later.
Bush must resolve to take on the issues that have cast doubt on the legitimacy of his presidency. He should appoint a presidential commission on ballot reform and affirm his commitment to the Voting Rights Act of 1965. He should work to end the disenfranchisement of our servicemen and to curb fraudulent voting by convicted felons. Although the Democrats would be skeptical of the former efforts and reluctant to participate in the latter, the end result would ultimately compel bipartisan assent.
Another resolution should be to tackle issues he was not associated with during the campaign. President Bush should put corporate welfare on the chopping block. The Democratic Leadership Council's Progressive Policy Institute has catalogued more than $111 billion in special benefits and tax breaks for big business. The Cato Institute has pointed out $85 billion in direct federal subsidies to business.
Not only are these payments outrageously inequitable and blatantly unconstitutional, they are massively unpopular. Cutting back on corporate welfare would not only distance Bush from the corporate contributors many feel "own" him, but it would gain support from the left and the right. Although he would have to fight key people from his own party, Bush could have Sen. John McCain lead the charge and can count on the support of leaders as varied as Sen. Paul Wellstone (D-Minn.) and House Majority Leader Dick Armey.
"Compassionate conservatism" can continue to be a Bush buzzword, with the new administration resolving to look for creative ways to tackle issues like poverty and drug abuse through tax credits, market-based incentives and faith-based initiatives. Bush has demonstrated a desire to confront problems liberals lament with conservative solutions. The biggest challenge is to be more practical than those who have attempted similar policy goals before. Nevertheless, Bush can only advance national unity if he is perceived as being serious about racial reconciliation and urban renewal.
Another resolution should be that a Bush presidency stays true to family history by being serious about world affairs. This is likely, given the presence of Dick Cheney, Colin Powell and Condoleeza Rice. But the our military involvement abroad needs to be more limited, our use of force more powerful and focused and our foreign-policy pursuits less idealistic and more realistic than the Clinton-Albright years.
Finally, Bush should resolve wherever politically possible to: appoint strict constitutionalists to judgeships, hard-money proponents to the Federal Reserve and people who will be loyal to him to administration posts. If Bush can go through with even a fraction of these resolutions, both he and America will have a Happy New Year in 2001.
W. James Antle III is a former researcher for the Rhema Group, an Ohio-based political consulting firm. You can e-mail comments to email@example.com.
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