Tags: moore | crisis | taxes

Moore: Washington Making Crisis Worse

By Dan Weil   |   Tuesday, 23 Jun 2009 03:52 PM

Author Stephen Moore says the Obama administration’s policy puts the economy at risk — rather than saving it, as most would presume.

Moore, a member of The Wall Street Journal Editorial Board, co-wrote the recently published book, “The End of Prosperity: How Higher Taxes Will Doom the Economy — If We Let It Happen.” His co-authors include Reagan-era economist Art Laffer and investment adviser Peter Tanous.

“All of the policies we’ve put in place since the housing bubble burst and the stock market crashed, I really believe everything we’ve done in Washington has made the crisis worse,” he tells Moneynews.

Moore criticized the policies of both President Bush and Obama. “Every policy they’ve put in place has made things worse,” he says.

“That includes the bailout packages for the banks, for auto companies and insurance companies.”

Moore also criticized “the multi-trillion-dollar economic stimulus plan, the enormous budget that just passed with $9 trillion in debt over next decade, and of course the big battle that’s being fought right now about the nationalization of health care.”

“All these things have a negative effect on the economy and are making recovery very difficult.”

One positive policy of the Bush administration was boosting the economy with tax cuts, Moore says.

“Now there’s a lot of talk about raising those tax rates back up. … When you’re looking at a situation right now where you have declining asset values and a falling stock market, the idea of raising taxes on stock ownership is very dangerous,” Moore says.

“We should be cutting tax rates on investments and savings and small business creation, not raising them. I think these are very misguided ideas. If you look around the rest of the world, you see a lot of countries talking about cutting their tax rates, not raising them.”

The fact that our corporate tax rates are the second-highest in the world among major industrialized nations is an acute problem, Moore says.

“It’s very difficult for American industry to compete … when we’re imposing higher tax rates on our firms than the Europeans and Japanese and Chinese are.”

As for the financial meltdown, it looks like the worst of the crisis is over, Moore says.

“My concern is all these things we’re doing. We’ve spent $2.5 trillion on government programs that aren’t working very well.”

Spending so much money to stimulate the economy is dangerous, Moore warns.

“I’m really worried that the economy will improve in the summer and fall but will crash again, very much like shoving sugar down the throat of a five-year-old.”

“These policies are very detrimental to the long-term economic health of the country, even though they may provide a short-term stimulus to growth.”

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Author Stephen Moore says the Obama administration’s policy puts the economy at risk — rather than saving it, as most would presume.Moore, a member of The Wall Street Journal Editorial Board, co-wrote the recently published book, “The End of Prosperity: How Higher Taxes...
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