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A Thought on the Shutdown & Growing the Economy

In an American Spectator column this week providing their five-step solution for economic growth and job creation, Lewis Uhler and Peter Ferrara introduce their plan by writing:

"The ongoing battles in Washington over the government shutdown and the debt ceiling are merely symptoms of a raging disease wracking the body politic: terminal government obesity. The sheer size and power of the federal government constitute a threat to our liberty and economic survival.

"It wasn’t always this way: Fewer than 100 years ago, as recently as 1929, federal, state, and local government in the United States taxed and spent only 10 cents out of every dollar, seven cents at the state and local level and three cents in Washington. Today Washington taxes and spends 25 cents out of every dollar (though 40 percent of this money is borrowed), and state and local government takes 15 cents, for a grand total of 40 percent of GDP. Add in compliance and out-of-pocket costs of federal regulations, estimated at $1.8 trillion annually, and government is costing us 50% of our income.

"Fifty percent of GDP is well in excess of the 18 to 20 percent that economists and researchers worldwide consider the target for a nation that wants to maximize economic growth and job creation. The well-being of every citizen is enhanced and assured when economic growth is maximized: The larger the pie, the more there is for everyone."

The five steps in their solution included:

  1. A flat tax.
  2. Hearings throughout America "so that taxpayers and local media can see . . . how out of control spending is."
  3. Devolve means-tested entitlement programs to states.
  4. Restore legislative authority of Congress.
  5. Reform the presidential election process.

One can argue with the f9ve-step solution presented by Uhler and Ferrara, e.g., preferring instead Mark Levin's, which he presented in his book, "The Liberty Amendments," (see our August 14, 2013 Growls) but it is far more difficult to argue the need to reduce the size and power of the federal government.

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