Perspective | Keep It Simple: Just Cut Taxes

Higher wages, GDP growth will help U.S. move forward

By Pat Freibert

PatFreibert 2Mother Nature in all its fury recently visited Houston, the entire state of Florida, mid-Atlantic states and Puerto Rico, creating widespread devastation. Besides loss of life, the hurricanes, storms and floods created massive loss of services and destruction of infrastructure that will take months or years to restore.

Nevertheless, the images of Americans helping each other out are truly inspiring – local citizens rescuing by boat helpless children, elderly people, family pets and farm animals; police, firefighters, National Guard and other first responders helping others to safety. Rescuers included neighbors and volunteers from local communities and other states who willingly committed acts of kindness and downright heroism. These wholesale rescue efforts of bravery serve as a graphic lesson about humanity.

Kentucky, like numerous other states, acquitted itself beautifully with its help in sending its National Guard, energy workers to restore power and first responders for first aid. University of Kentucky basketball coach John Calipari used his energy and popularity to raise significant funds to help victims of the disaster. Evangelist Franklin Graham of North Carolina also vigorously took on the challenge to successfully raise funds to help victims. Disasters many times bring out the best in us and can call forth our humanity – neighbor helping neighbor. If only this display of spontaneous action would spread to Congress to attack the nation’s most urgent problems, Americans could experience more hope for changes to benefit the entire society.

It is now October – the year is three quarters gone – and Congress has barely touched the critical issues facing the nation. Repeal and replace Obamacare as promised? Energy? Tax reform and cuts? Illegal immigration? Yet, Congress took a longer August break away from Washington than in most other modern years. Foreign affairs and national defense issues are merely simmering, going nowhere. America’s foes notice things like that.

On the paramount issue of tax reform, three of the president’s notable advisers on tax policy – Steve Forbes, Larry Kudlow and Stephen Moore – are urging Congress “to keep the debate focused on three simple reforms: (1) Cut tax rates for large and small businesses to 15 percent to make America competitive and to create jobs. (2) Repatriate $2.5 trillion of money held by American companies back to the U.S. at a 10 percent tax rate. (3) Double the standard deduction for every family and individual filer.”

These three well-known economic experts say “stop there” – no border tax, no carbon tax, no surtax on rich people. No end of popular tax deductions. Keep it as a jobs bill that cuts taxes. According to a recent Investors Business Daily poll, 55 percent of voters support the 15 percent business tax rate, 66 percent support the tax cut for families and 75 percent support repatriation. Polls also show majority support for a tax cut. Similar tax-rate cuts under Ronald Reagan and JFK resulted in job creation and revenue growth. These experts believe the business tax cut is a middle-class tax cut – since the Congressional Budget Office concluded that more than 60 percent of the gain from a business tax cut goes to workers in the form of higher wages.

Basically, the advice from these three experts is: “Don’t try to rewrite the 80,000-page tax code. Cut taxes now. Then build political momentum for a tax reform and simplification agenda in 2018 and 2019.”

After the Reagan tax cuts, the economy jumped to 4 percent growth. That sounds like a good plan and one that can be enacted.

In the spirit of helping Americans restore a healthy economy with better pay for workers, Congress should get to work and take the necessary steps to help American workers’ real income rise. “Keep it simple,” says Moore. Just cut taxes for now and move forward. Like the neighbors, officials and first responders in Houston, Florida and the mid-Atlantic States, Congress can do something that will help neighbors and fellow citizens.

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