By Dr. J. Robert McClure III, JMI President & CEO
The current discussion over whether or not to extend the “Bush” tax cuts to all Americans should really be a simple one. When citizens have more money in their pockets in the form of a “tax cut” — never mind that it is our money to begin with — those same people then have more money to spend, save, or invest. This, in turn, creates commerce, promotes free enterprise, and gets the economy and small businesses thinking about growth again. And if tax cuts are good for the economy when it is in lousy shape, as the President and both parties have told us, then why aren’t those same tax cuts good for the economy all of the time?Revenues to the Treasury always increase when people are able to keep more of their own money because lower taxes and more money in consumers’ pockets means more buying and selling will occur in the marketplace…and with every transaction, Uncle Sam gets his “take.”This simple lesson also illustrates that the problem in Washington is rarely about revenue and almost always about spending. Politicians up there just can’t help themselves because it is always easier to spend someone else’s money than it is to spend one’s own, and unfortunately for you and me, that’s what many elected officials from both parties love to do. At this writing, all of the Republicans and more than 40 Democrats in the House – and the number keeps growing – are pushing hard to extend all tax cuts to all citizens. We’ll see.