I was watching Fareed Zacharia on CNN this morning. For those of you who don't know him, he is an Economist who was born in India. He is also very intelligent and has a grasp on economic issues that keep on surprising me. He seems to cut to the meat of the situation or problem every time.
One of his guests this morning was John Huntsman - one of the Republican contenders for the Presidential nomination. If I were Obama I would more worried about John Huntsman than I would be about most of the other candidates. He made a lot of sense. There were still some problems, in my mind anyway. For one thing he supports cutting taxes, which I think is a mistake. It seems to me that we are way under taxed. Pretty obvious really when you consider that we borrow 40% of all that we spend! You couldn't keep that up at home for long, could you. But of course it is an easy vote getter to say "I want to cut your taxes".
The facts, as Zacharia pointed out, are that our tax rate at present is the LOWEST that it has been in more than 60 years! It is also the lowest of the top 28 world economies. In other words our tax rate is the lowest of the top 28 economies in the world. And it doesn't seem to be helping does it? He then pointed out that growth in all areas has historically been better when taxes were higher! Under Reagan and under Clinton for example.
Our infrastructure - roads, airports etc - standing in the world has dropped dramatically as had a long list of standings, not least of which was from number 1 in University graduations to number 14. Our output of graduates in the scientific areas was even worse.
Seems to me that we need an increase in taxes. And we should use the money to pay down our debt, to rebuild our roads, airports etc, and to help our young people to go into the maths and sciences at university. We should also encourage saving - remember when we used to be encouraged to save? I do. Those savings were used to loan money to businesses.
And while I'm at it, when you go to war you need to ask everyone to help and to sacrifice. That has always been the way. Now we just sit in front of the TV and watch the wars happening, like it was some sort of "Reality Show". I'm sure people would respond if we were told "Hey we are at war, we need everyone to pitch in. Cut your use of electricity, gasoline, or whatever is necessary. Oh and by the way, there will be a 'war tax', an across the board tax of 5% of every ones income to pay for the war (or whatever amount is deemed necessary)" That would bring home to everyone that we are at war. And it might bring it to an end earlier.
Just a few common sense thoughts.