The Recovery of 2004

OPINION JOURNAL.COM (Wall Street Journal) ^ | 9/10/2001 | ROBERT L. BARTLEY

[NYS_Eric]

Friday's jump in the unemployment rate and stock market plunge may have a silver lining, if they break the grip of what two weeks ago I called "cockamamie economics." With the economy faltering, Washington has been aflutter over whether to pay down the federal debt by $158 billion or $153 billion--the surpluses estimated respectively by the Office of Management and Budget and the Congressional Budget Office.

[Inspector Harry Callahan]

Washington has been aflutter over whether to pay down the federal debt by $158 billion or $153 billion

Yeah, I can see how tuff that decision would be. I mean the Defense Department just "misplaced" 1.1 trillion bucks. What's a five billion dollar difference in debt reduction when you "lose" 1.1 trillion here and there?

[David]

Even after full implementation of the delayed cuts, marginal rates are still way too high. The critical issue is capital formation that leads to creation of physical capital assets that improve productive capacity (as distinguished from savings that flow into the bid and asked market for publically held common stocks).

There is no after tax rate of return incentive to invest risk capital in productive capital assets. To create such an incentive, marginal rates must be reduced substantially.

Things that ought to be considered: Reduction of the Capital Gains tax; reduction of marginal rates to higher income taxpayers who have a higher propensity to invest; get the Treasury out of the business of limiting the rate of write-off of true capital asset investments (they are protected by recapture in the event of premature sale at capital gain rates); reinstate the General Utilities doctrine; and permit deduction of dividends.

[VoodooEconomist]

Keynesian crapola. Let's suck money out of the private sector. Yeah, that's the ticket to an economic recovery. Moron!