Townhall.com ^ | February 26, 2014 | Donald Lambro
WASHINGTON - Louisiana Gov. Bobby Jindal came up with the perfect name for
the Obama economy that you'll be hearing a lot in this year's midterm election
campaigns.
"After more than five years under this administration, the Obama economy is
now the minimum wage economy," the Republican governor told reporters after a
meeting he and his gubernatorial colleagues held with Obama at the White House.
With his anemic economy still unable to produce enough jobs to put millions
of unemployed Americans back to work full-time, Obama is offering a old,
threadbare idea to raise the nation's minimum hourly wage to over $10.
Congress's budget analysts say it could result in the loss of at least a half
million jobs, and possibly a million.
The nonpartisan Congressional Budget Office said that forcing small
businesses to raise their hourly wages would result in layoffs to keep their
payroll costs down, or cause employers to hire fewer low- wage workers in the
future.
In a nation with a workforce of 160 million people, many of whom are jobless
or can only find part-time work, this is a poor excuse for an economic recovery
program. In fact, it is pathetic.
Making struggling businesses in a weak economy pay higher wages is not a plan
to get America growing again.
"I think we can do better than that. I think America can do better than
that," Jindal said. If this sounds vaguely familiar, it is almost word for word
what John F. Kennedy told voters in the 1960 presidential election as he touted
his plan for cutting income tax rates for everyone to boost economic growth and
job creation.
Surely we can do better than this, but don't hold your breath believing that
this do-nothing president will put the American economy back to work anytime
soon.
What could we do right now to jump start the engine of a stalled economy? For
starters, Jindal suggested that the president could approve the Keystone XL oil
pipeline "if he was serious about growing the economy."
That would create thousands of jobs and give the U.S. energy industry a
booster shot that would send a signal to the economy that we're serious about
boosting the growth rate beyond its anemic 2 percent range.
But Obama has been dithering over this issue for the past two years because
he fears his approval will anger his party's radical environmental allies in a
critical election year that could put Republicans in charge of the Senate. His
reluctance is holding back the economy and stronger job growth in the process.
But that's not the only pro-growth initiative he has been blocking.
Congress's tax-writing committees have been at work since 2011 on overhauling
our costly, dysfunctional tax code that is also hurting our economy, slowing
down job creation, and making us less competitive in global markets.
House Republicans, led by Ways and Means Committee Chairman Dave Camp of
Michigan, were expected to lay out their plan Wednesday. It would simplify the
tax code by slashing its seven tax brackets down to two: 10 percent for lower
income workers and 25 percent for the top rate.
The plan would be revenue neutral because it calls for eliminating a number
of tax loopholes and exemptions that now litter the tax code.
This is what the co-chairmen of Obama's deficit-cutting commission proposed
in his first term in a report that the White House has ignored ever since.
But the idea took hold in Congress where Camp and his Senate Democratic
counterpart, Finance Committee Chairman Max Baucus, were working together on a
tax reduction bill.
But as their work was bearing fruit, Baucus decided he would retire from the
Senate at the end of of his term. Still, it appeared a deal between the two was
possible. That is, until Obama suddenly offered Baucus the prestigious post of
ambassador to China, getting rid of one of tax reforms' most enthusiastic
supporters.
It certainly wasn't because Obama decided that Baucus was head and shoulders
the most qualified candidate for the post. Indeed, Baucus said at his nomination
hearings that he knew next to nothing about China.
The timing of Obama's offer to Baucus raised eyebrows in and out of Congress
since it meant that any possibility of tax reform was dead in the Senate for
this year. That's because the chairmanship of Baucus' committee fell to liberal
Sen. Ron Wyden of Oregon who has since focused on other issues that he considers
higher priority.
It's unclear whether House GOP leaders will take up tax reform this year,
though they haven't ruled out doing so in the months to come. Congressional
reformers think that if Speaker Boehner puts it on a fast track, it would send a
powerful political signal to voters that the GOP is serious about a pro-growth
initiative that would strengthen our economy and put Americans back to work.
And where's Obama in all of this? The Washington Post wrote Tuesday that "the
White House continues to show little interest in a comprehensive tax overhaul."
The newspaper went on to say that "administration officials have dismissed
reform of the individual code, saying it would be mathematically impossible to
lower the top rate paid by the wealthy, protect the middle class and achieve
Democrats' goal of raising fresh cash to shrink chronic budget deficits."
This was to a large extent what critics said of President Kennedy's
across-the-board income tax cuts: They would worsen the deficits, endanger
middle class programs, and benefit the rich. But in the end, his tax cuts led to
business expansion, created jobs and it didn't worsen the deficit. By the end of
1960s, we had a budget surplus.
Obama says he wants to lift the middle class as well as those below the
poverty income line, but he's opposed to pro-growth, pro-job policies to do
that. Instead, he and his party have become the champions of a jobless, minimum
wage economy.
What a contrast in economic policymaking. Kennedy defended his tax cuts for
all incomes by saying, "A rising tide lifts all boats," while Obama and the
Democrats say raising the minimum wage is the best we can do.
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