America needs to unleash its entrepreneurs to create new wealth and boost employment and President Barack Obama is “following all of the wrong policies,” George Gilder, a New York Times best-selling author and pre-eminent economic thinker, told Newsmax TV.
Gilder, who has a new book called: “Wealth and Poverty: A New Edition for the 21st Century,” said the entrepreneurs will help open new horizons.
“What we need now is to unleash the entrepreneurs of America to create new wealth and jobs and open new horizons of possibility for all of our people,” he said.
Watch the exclusive interview here.
“Instead, we have 16,000 new IRS agents to administer our medical care with no new doctors. Obamacare provides for 16,000 more IRS agents. We have natural gas pipelines blocked. We have Boeing’s effort to build a manufacturing plant blocked. We have proposals for cap and trade. We have the entire economy put under a shadow by EPA regulation of CO2, which is what we all breathe out and sustain planet and animal life. Obama’s following all of the wrong policies.”
Gilder, who published “Wealth & Poverty” in 1981, said circumstances were different back then but a new set of economic policies under President Ronald Reagan turned things around.
“We just went through a financial crisis and financial crises are always riveting and upsetting events and they change and they test people’s policies,” he said. “Back in the 1970s, when I wrote “Wealth and Poverty,” Jimmy Carter was president and interest rates were towering and we were going through a financial crisis with the savings and loans and everything that was done at that point after Reagan was elected was pretty much correct and in line with the supply-side idea.”
He continued, “Tax rates were reduced, money supply was disciplined, natural gas was deregulated and the whole economy was unleashed on a new trajectory that produced 42 million net new jobs. Now, this financial crisis of Obama is the opposite and almost no net new jobs at all have been created since he began addressing the crisis.”
Gilder said he sees government collaboration for subsidies as greed, not capitalism.
“My view is that based on actually looking at what greedy people do. If you’re greedy, what do you do? You collaborate with government to get special privileges, special benefits, advantages,” he said. “You get all sorts of favors; unearned benefits. That’s what greedy people do. So my view is that greed leads as by an invisible hand to whatever growing welfare state to socialism, not capitalism.”
Gilder said the answer to poverty is capitalism and capitalists root for others to succeed because they benefit from the success of others.
“When you think of what capitalists do when they start businesses is the first thing they do is they have to save,” he said. “That means forgo consumption. Then they have to collaborate with others. Then they have to have ideas about the needs of other people. And, above all, the golden rule is that they have to hope that others succeed because no capitalist company can thrive unless other capitalist companies are thriving; unless their customers are prospering. And the biggest untapped market always is the global poor. So capitalists, above all, want the poor to get rich. So the real answer to poverty is capitalism.”
Gilder said it doesn’t take long to restore capitalism to its full potential.
“The fact is, and I discuss this in ‘Wealth and Poverty’ in my new edition, over and over again we’ve discovered that radical changes are possible to release entrepreneurs from bondage and create economic growth,” he said. “When you decide to do it, it can be achieved overnight. After the Second World War, we reduced government spending by 60 percent. Sixty percent. And all of the Keynesian economists said we would face the worst depression in the history of the human race.”
He continued, “No economy had ever confronted such potential unemployment and dislocation as the United States after the Second World War, according to Paul Samuelson, the leading Keynesian economist. Instead, we created 7 million jobs net and two years of growth with 10 percent. We went on a 10-year boom that now is regarded to be a golden age. This happened almost overnight. The Republican Congress in 1946, over Truman’s veto, passed the joint tax return allowing couples to be counted as two people. And this effectively reduced tax rates for most households by 50 percent.”
Obama’s policies thwart growth as Romney is “great” when it comes to economics.
“We’re going over a tax cliff in early January where the dividends tax will be potentially almost triple the capital gains tax, almost double the income tax raised substantially and in conjunction with Obamacare taxes and other special fees and penalties, many taxpayers will have a greater incentive to hide income than to earn income. In those conditions, you can’t really have growth.”
He said, “Romney is great on economics. He started at the Boston Consulting Group which provided the microeconomic foundation for supply-side economics. When I wrote ‘Wealth and Poverty,’ Mitt Romney’s boss, Bill Bain, called me up and said that I underestimated the power of supply-side economics and he wanted to introduce me to Mitt Romney.”
“Mitt Romney at that point was giving, essentially, supply-side advice to all of these companies with which he was consulting,” Gilder said. “His view was that America was like a business with a profit problem and when a business has a profit problem, it can overcome it can’t overcome it by raising its prices. That will just drive away customers. It has to lower its prices and expands its markets and open up new horizons of opportunity. And that’s what Mitt Romney will do for the American economy.”
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