Dallas-based investment company executive Frederick “Shad” Rowe argues in the latest Barron’s that the American economy’s recent growth might represent more than just a “sugar high.” He points to a number of positive factors pointing toward real long-term growth.
North American Energy Independence: Since 1973 and the emergence of OPEC, the U.S. has been bleeding capital to people who don’t like us. To compound the problem, we have had to spend more money to fight wars against enemies we previously financed. That may stop. North American energy independence is achievable now. It can save us a lot of money and make for new profit opportunities.
Sensible Immigration Reform: We can encourage our most enterprising and hardworking people to become citizens. We don’t have to chase them away from working in our economy.
Repatriation of Corporate Income: $2 trillion earned offshore by American corporations remains offshore to avoid ill-conceived American corporate taxes. If a company domiciled in Germany makes money in Argentina and wants to invest it in the U.S., we welcome it. Instead of taxing it, one of our states may give the foreign company a tax holiday. But if a company domiciled in the U.S. does the same thing, we double-tax the daylights out of it. It would be hard to imagine a more counterproductive tax policy. It generates little to no revenue and deprives the American economy of $2 trillion. There are a number of movements afoot to bring that money home. …
… Lowering Corporate Taxes: The chairmen of the tax-writing committees in Congress got out in front of this issue in 2013, and success could be closer than most people expect.
Everyone should come see how low taxes work in Texas, which has no personal income tax, low business taxes, and low taxes in general. Surprise, surprise—a low-cost business environment has served as a magnet, motivating companies of all sizes to move from high-cost tax states like California, New York, and Illinois to Texas.
Texas has taken over from California in paving the way to America’s future. What happens in Texas can serve as a precursor to what will happen in the U.S. …
… Obamacare: Even this bureaucratic catastrophe provides a large possibility for economic opportunity. Think of Jimmy Carter’s failures, which opened the political door to Ronald Reagan, who said: “Government is not the solution to our problem; government is the problem.” Reagan was right then, and his words should be remembered now. All of the eight hopeful signs have governmental dimensions and, in all eight, it’s the government standing in the way of progress.
Politicians and policymakers seeking ideas for promoting economic growth might want to consult John Hood’s recent work.