The Obama Administration has seized control over much of the American economy. Health care is to be centrally administered, even though the administration admits costs will probably increase. Some companies will be considered too big to fail, thus they will always face the prospect of government taking away their independence. We the People will always face the prospect of bearing heavy financial burdens in order to bail out some failed business or a failed homeowner because the politicians wish to influence the economy.
The Left insists on government control of the natural economy despite history showing clearly how utterly government fails at that. Governments screw up. The free economy creates more wealth for everybody. Government only consume, so governments can only allocate poverty. Humans will always seek to escape misery. The pity for America is the present rush into it.
But what if American Leftists may genuinely think the free economy needs to be tamed under government control? Let me suggest a rhetorical question for those Leftists, to give them some insight into a good understanding of the economic importance of the free market.
Which is better for the environment -- A wild lion left to freely roam the savanna, or for the lion to be locked up in a zoo? Why?
The answer is Humans cannot fit a lion into a zoo without doing some harm to the environment, and great harm to the lion. Human understanding is inferior to the natural world.
So it is with natural economics. An economist will tell you we understand a great deal about how economy works. But its certain we are no nearer to controlling the economy than we are to controlling the weather. Nevertheless, some Leftist economists smugly insist they know how to control economy. Their hubris is a clue they don't have the answers.
The U.S. is in recession. Still.
Consumer spending and economic activity is down due to uncertainty about government policy. This uncertainty perpetuates the recession and perpetuates high unemployment.
The Bush tax cuts will expire Dec. 31, 2010. The "Democratic" Party controlled Congress will use the only tool they like: Higher taxes. Income taxes will increase:
35% bracket which will increase to 39.6%
33% bracket which will increase to 36%
28% bracket which will increase to 31%
25% bracket which will increase to 28%
10% and 15% will all pay 15%
No matter your income tax bracket:
If your taxes will increase, the economy will decline.
Capital gains tax will increase from 15% to 20%
Dividends tax will increase from 15% to 39.6%
The Democrats in control of Congress ought to abandon their desire to control the economy and let the poor beast recover. They will blather on about fairness and planning, but expect them to screw up. Its the Democrats --- its what they do.