David Frum offers an interesting assessment of Tim Pawlenty’s Economic Plan … here’s the highlights
Pawlenty has thus cast himself as the latest apostle of low taxes and tight money. It’s not a bad place to stand, politically. It can yield campaign contributions and generate enthusiasm from important segments of the Republican base.
But as economics, it’s troublesome.
The question for today: to what problems are Pawlenty’s problems the answer?
There’s no inflation to be snuffed, and productivity is improving smartly: up 4.2% in manufacturing in the first quarter of 2011.
What we do suffer from are enormous levels of public and private debt, and lagging domestic demand for goods and services. Tight money will only add to the burden of public and private debt. Nor will a reduction in income taxes for the upper brackets help much with the demand problem: as we saw in the Bush years, rich people use extra income to buy additional capital assets.
Let’s repeat that last statement …
Nor will a reduction in income taxes for the upper brackets help much with the demand problem: as we saw in the Bush years, rich people use extra income to buy additional capital assets.
Hmmmm … ponder that statement while reading some other reviews.
NOTE : David Frum is a former speechwriter for President George W. Bush, has been named one of America’s top influential conservatives, Contributing Editor for The Weekly Standard, etc.