A better way to solve our economic challenges

Published 8:00 pm Saturday, February 7, 2009

There is no question that the U.S. is facing a serious economic challenge and that the people of Alabama and the entire nation are looking to Washington for leadership.

But we also know from the last several months that enormous and unprecedented government interventions in the economy have enormous and unprecedented consequences. In crafting any economic stimulus plan, we must be aware of both the short and long-term ramifications of burdening taxpayers with ever more debt.

Borrowing and spending got us into this problem and more borrowing and spending will not get us out of it. The government cannot solve a problem by throwing money at it, so it is essential that we do not approach this debate with the “fire brigade mentality” that characterized the response to the corporate bailouts.

The “stimulus” bill that the House and Senate leadership have presented to the American people contains twice as much spending as the New Deal. That was over ten years. This is one bill.

It will cost every American household almost $7,000. But instead of promoting economic growth, it has turned into a grab bag for special interests.

For example, the bill passed by the House majority increased funding for the National Endowment for the Arts by $50 million and directed tax dollars to political action groups like ACORN, which is under investigation for voter fraud in 12 states. Incredibly, at a time when we are trying to reduce foreclosures, it expands a $4 billion program that will actually encourage more foreclosures.

While reducing the price of energy is critical to maintaining jobs, the House bill made no mention of nuclear power. We cannot meet our rising electricity needs without nuclear energy.

Political sacred cows have no place in designing a stimulus bill. The provisions must focus on jobs and generating economic benefits specifically. Being a worthy program doesn’t mean it should be included unless it can be shown to offer real and tangible financial benefits.

There are proven ways to stimulate the economy, as demonstrated by President Reagan’s tax cuts during the 1980s.

In fact, applying methodology used by Dr. Christina Romer, who is one of President Obama’s top economic advisers, an approach emphasizing tax relief would create nearly twice as many jobs in Alabama than a bill relying on borrowing and spending.

The reason is simple. Working families and businesses will always spend their money smarter and more efficiently than the government. Therefore, our policies should be geared to helping them spend, save, and invest more of their own money by cutting your taxes.

The American people do not want short-sighted solutions. For too long, Washington seems to have been influenced by the words of that famous philosopher, Daffy Duck, who said, “Consequences, shmonsequences! So long as I’m rich!”

We must avoid the “trial by fire” legislating that has provided little or no opportunity for thoughtful dialogue and discussion and engage people across the political spectrum to find comprehensive solutions to the many challenges facing our great nation. In my view, we have the time and indeed the responsibility to reach a common sense bipartisan compromise that will help grow the economy and benefit all Americans.

If Thomas Paine was with us today, he might again write, “These are the times that try men’s souls.” But we are Americans, and I have no doubt that within us we have the will and wisdom to meet the challenges that lay before us.