Saturday, June 26, 2010

Get off the Deficit-Spending Treadmill

As the G-20 meets in Toronto, I want to make a point: Stop the crazy spending and borrowing and stocks will start rising again while economies pick up recovery speed.

In the U.S. and around the world, stocks have fallen about 11 percent this spring. It’s a signal of lost confidence. Out-of-control deficit spending has swept the world toward a leftist vision of big government. We need a return to free-enterprise incentives in order to speed up recovery.

My simple point: Get off this left-wing Keynesian treadmill of deficit spending. Get off it. In fact, cut spending and borrowing, hold down tax rates, and try restoring confidence in private enterprise for a change.

Team Obama will give the G-20 that old-time liberal religion of more and more spending. It’s wrong. Meanwhile, the new Tory government of David Cameron in Britain is cutting $170 billion out of the deficit. In Germany, Chancellor Merkel is cutting $100 billion. They’re not taking our advice. Good. Japan is slashing its corporate tax rate to 25 percent. Why don’t we do this?

Create investment and jobs rather than deficits and welfare. Instead of mangled multipliers, let’s have some new economic-growth incentives to spark real world economic recovery.