Losing 33,000 jobs in the Hickory area over the last decade has been hard and has touched everyone in our community – financially and personally. Getting the economy back on track – given the hole the politicians have dug – won’t be easy or simple.
Studies show that when the recession began families across America acted responsibly – they cut back on their spending and paid down their debts. At the same time, the politicians in Washington moved in the opposite direction. They spent more and borrowed more. President Obama told us – we can spend our way to prosperity. But recycling that old idea didn’t work.
Now the politicians in both Washington and Raleigh have to do what families across America have already done – act responsibly by cutting spending and debt.
While we are at it, this is a good time for a serious, in depth, discussion about the role of government. What should government do and what shouldn’t it do?
The federal government provides low income people with free cell phones and North Carolina state government implements that program. Now, should government be in the cell phone business? Or would we be better off with less government and economic policies that create jobs – so people can buy their own cell phones?
That’s an example of a government program most people would agree we can do without. But doing away with other programs is more controversial. Under current tax law, when the people of the Catawba Valley go out and spend a million dollars on cars, they will collectively pay $30,000 in taxes on the sales. But if someone spends the same million dollars on an airplane, due to a loophole, the tax is capped at $1500. A lot of economists argue we’d be wiser to eliminate the loopholes and reduce the overall sales tax rate. Of course, if you like airplanes, that may not sound like a good idea.
We will grow the economy and create jobs when we reduce the size of government while simplifying and reducing taxes. The timing won’t get any better.