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A phrase you hear in Washington a lot these days is "shared sacrifice." To an alarming degree, the budget debate has degenerated into a game of green-eyeshade arithmetic, with many in Washington demanding that we trade ephemeral spending restraints for large, permanent tax increases.
The only winners in that trade are special interests in Washington, with taxpayers and working families taking the hit today, and future generations taking an even harder hit tomorrow. I call it the "shared scarcity" mentality. What's missing from the equation is economic growth.
Fiscal discipline is a means to a greater end: a growing, prosperous economy. These goals are mutually reinforcing: Sound government finances are essential to economic growth, and economic growth is essential to stable revenues and a citizenry that is not dependent on government spending.
Past periods of American prosperity were no accident: They resulted from adhering to the foundations of economic growth:
1. We have to stop spending money we don't have, and address the structural drivers of our debt.
2. We have to restore common sense to the regulatory environment, so that regulations are fair, transparent and predictable.
3. We have to keep tax rates low and predictable, so that job creators have incentives to invest in America.
4. We have to refocus the Fed on price stability, instead of using monetary stimulus to bail out Washington's failures. Businesses and families need sound money.
Let me deal with each in order.
The first foundation, real spending discipline, is pretty simple. You can't get quality, sustainable growth by continuing to bury the economy in debt. More debt means more uncertainty, and more uncertainty means fewer jobs.
Mounting debt also threatens our poorest and most vulnerable citizens, because those who depend most on government would be hit hardest by a fiscal crisis. We have to make our safety- net programs more sustainable so that they are there for those who need them most, and this starts by building on the successful, bipartisan welfare reforms of the mid-1990s.
Most important, we cannot avert a debt crisis unless we directly address the relentlessly rising cost of health care. These rising costs are not just threatening the nation with fiscal ruin, but also hurting our economy. One reason that many people haven't seen any increase in their wages in a long time is because health care costs are rising too quickly and eating into their paychecks.
A very reliable source reports that the White House believes the Republicans have handed them a "political bonanza on Medicare." The Republican leadership, the source reports, counters that they are "insisting on an alternative health bill that might have avoided Medicare's current state of ...
As if more proof were needed about the minimum wage's devastating effects, yet another study has reached the same conclusion. Last week, two labor economists, Professors William Even (Miami University of Ohio) and David Macpherson (Trinity University), released a study for the Washington, ...
Much was written last week about how much thanks George W. Bush deserves in tracking down Osama bin Laden. The answer is: a great deal. Information extracted from al-Qaida operatives under Bush's interrogation policies ultimately led us to the compound in Abbottabad. But he did more. As an IBD ...
We continue to get good news about manufacturing, which is clearly embarked on a long-awaited and highly desirable resurgence. The Federal Reserve recently noted that manufacturing is outgrowing the rest of the economy by 3-to-1. This augurs well for the long term. Forced to the wall by fierce ...
As debates heat up in states across the country over budget shortfalls, more and more focus is being placed upon the runaway growth in health and pension benefits for state and local government workers. These excessive benefits are a major factor behind the exploding costs of government in many ...
Posted By: mike849(5) on 5/16/2011 | 10:43 PM ET
I agree fully. Next election cycle we need a few hundred more Ryans in the House and Senate, and 1 more in the white house. If you think i want government slashed so i can get more money back from the government, you're all wrong. I want the government to stop taking MY money on things that are at worst criminal, unconsitutional, and fraudulent, and at best wasteful, inefficient, and misguided.
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Posted By: Cindy059(35) on 5/16/2011 | 8:34 PM ET
Rep. Paul Ryan has common sense and is forward thinking. That is hard to find in DC. I vote for Paul Ryan's approach and renewed prosperity!!
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