Hatch says we could go all the way back to a 90 percent tax rate if we don’t stop all this spending.
Meanwhile, the well-respected, non-partisan Tax Policy Center says the top rate could get to 77 percent and that would only get us to a 3 percent deficit share of GDP. That’s nowhere near a balanced budget.
As a supply-sider, I’ll say this: Reversing the 50 years of lower-tax-rate progress that started under Pres. John F. Kennedy would deliver a brutal body blow to our long-run economic prosperity and stock market.
This is exactly why my V-shaped recovery-boom scenario can take us to year-end 2010, but not beyond that — unless and until we see some wholesale changes to Washington money-politics and policy.
Incidentally, on tonight’s program we’re going to welcome supply-side godfathers Art Laffer and Robert Mundell to talk about taxes, spending, borrowing, and growth. We will discuss the gathering high-tax storm clouds that will derail U.S. economic growth if Washington doesn’t quit spending so much. You won’t want to miss it.
But let’s enjoy the here and now, one day at a time.
Lately, I’ve been talking a lot about the V-shaped recovery in profits, ISMs, household employment, commodity indexes, and railroad freight-car loading. These are significant indicators of a stronger-than-expected economy in the quarters ahead. Now I’d like to add three more indicators.
First up is aluminum: