Economy

Leftist Policy vs. Liberty: The Economic Freedom Index

Contrasting the policies of Donald Trump with various Democrats is enlightening.

Lewis Morris · Jan. 29, 2019

When it comes to economics, leftists hold to very specific ideals, and centuries of history and those failed economic policies among many nations do not sway them. Even recent history and the failed economic policies of the Barack Obama years don’t make Democrats blush when they announce the same tired plans under new names.

Consider Sen. Elizabeth Warren’s call for a wealth tax on the richest Americans. Because some people are apparently too darned rich, Warren wants to tack a 2% tax on people with more than $50 million in net worth. People with more than $1 billion in the bank would get tagged for 3%. Keep in mind this would be an additional tax on top of what earners in these brackets pay in income, property, business, and capital gains taxes.

This plan has been proposed before. It’s not calamitous, perhaps, but it also has been criticized before by clear-thinking economists from around the globe. When you tax investors, they take their money overseas or push it into places the government can’t reach. Either way, the result is reduced investment capital, a slower economy, fewer jobs, less innovation, and — here’s the real kicker — less tax revenue. It seems an insurmountable concept for leftists to grasp, but taxes that are too high ultimately mean less tax revenue.

Why pitch this now? Warren’s running for president, and she needs to differentiate herself from the crowd of “progressives” who have thrown their hat into an already crowded ring. It’s a heated battle to see who can spend more of our hard-earned money.

Why pitch it again if it doesn’t work? Leftists never, ever believe that their programs and policies fail. When problems arise, it’s either because not enough money was spent (or in the case of tax hikes, stolen), or because someone on the Right sabotaged their plans.

Warren’s not alone in recycling bad ideas. Florida Reps. Ted Deutch (Democrat) and Francis Rooney (Republican) of the House Climate Solutions Caucus reintroduced a $15-per-ton carbon emissions tax that would rise by $10 per year until it reaches $100 per ton. They claim this $1 trillion tax would be “revenue neutral,” meaning that it would not be an imposition on taxpayers because it would be offset by tax cuts somewhere else. The problem is no one has announced where the offsets will take place yet. Maybe they’ll just have to pass this tax bill to find the offsets.

But wait, there’s more. New York Rep. Alexandria Ocasio-Cortez’s glorious Green New Deal is yet another attempt to guilt people into paying higher taxes for the sake of eliminating fossil fuels. Ocasio-Cortez’s plan is light on details, no doubt by design, but she says it can be paid for by raising the tax rate for incomes over $10 million to 70%. Oh, and some deficit spending. But no one on Capitol Hill seems to get excited about deficits anymore. So whatever.

This statement apparently cannot be repeated enough: Higher taxes never bring growth; only more power and control for government. And when a tax increase inevitably fails to raise the promised revenue, the taxes spread down the income chain until hitting the middle class. Middle-income earners then get a double whammy because they also get hit with higher prices and reduced purchasing power as the economy sputters under the weight of higher taxes.

Leftists want the masses to believe that all our problems can be solved if the rich just paid their fair share. What does a fair share look like? Classists will never tell you. That amount must always be nebulous and just out of reach of the resources at hand. All that matters is the rich must be not playing fair, so therefore they must be punished.

Stoking the fires of class warfare is a major tenet of leftist ideology. Class warfare worked for Vladimir Lenin in 1917, and the most popular communists/fascists of today’s Democrat Party are looking to repeat that success. How do we keep these monsters in their cages?

These leftist policies must be proved false to the public before more taxpayer money is stolen. And we need look no further than comparing the economy under our last president and the economy under our current one.

High taxes, curbs on investment, government intrusion in the economy, and excessive regulations were the hallmark of the previous presidency. Economic growth never hit 3%, millions left the labor market, and economic freedom took a hit.

The Heritage Foundation’s Economic Freedom Index performs an annual ranking of the nations of the world by measuring tax burden, protection of property rights, trade policies, labor laws, and judicial effectiveness. During previous administration, America’s ranking dropped from sixth place to 18th. In just one year under Donald Trump, America jumped back up to 12th place, measuring its highest score on the index since 2011.

This jump in economic freedom, like the nation’s economic growth, is the direct result of Trump implementing tax reduction, deregulatory and free-market policies. Reducing taxes and slashing regulations brought the intended result of more investment, more jobs, and increased labor participation. Imagine what the economy might look like if the government reduced deficits and cut taxes even further.

Economic freedom is good for the wallet and much more. With economic freedom comes the power of choice in every aspect of our lives. More options in health care mean a healthier population. More choice in education means a better educated and more productive society. And protection of property rights means better environmental stewardship.

The economy still has room for improvement, but great strides have been made in the last two years, and Trump’s economic policies have been largely responsible. If the Left has its way, those gains will most definitely be rolled back. And the government will have more control over our lives. Who in their Right mind would ever want that?

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