Thread: 100 ECONOMISTS: Obama’s Tax Plan=Deep Recession

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  1. #1 100 ECONOMISTS: Obama’s Tax Plan=Deep Recession 
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    ARLINGTON, VA — Today, McCain-Palin 2008 released the following statement signed by 100 distinguished and experienced economists at major American universities and research organizations, including five Nobel Prize winners Gary Becker, James Buchanan, Robert Mundell, Edward Prescott, and Vernon Smith. The economists explain why Barack Obama’s proposals, including “misguided tax hikes,” would “decrease the number of jobs in America.” The prospects of such tax rate increases under Barack Obama are already harming the economy. The economists conclude that “Barack Obama’s economic proposals are wrong for the American economy.” The proposals “defy both economic reason and economic experience.”

    The full economists’ statement on Barack Obama’s economic proposals and a complete list of economists who support it follows:

    Barack Obama argues that his proposals to raise tax rates and halt international trade agreements would benefit the American economy. They would do nothing of the sort. Economic analysis and historical experience show that they would do the opposite. They would reduce economic growth and decrease the number of jobs in America. Moreover, with the credit crunch, the housing slump, and high energy prices weakening the U.S. economy, his proposals run a high risk of throwing the economy into a deep recession. It was exactly such misguided tax hikes and protectionism, enacted when the U.S. economy was weak in the early 1930s, that greatly increased the severity of the Great Depression.

    We are very concerned with Barack Obama’s opposition to trade agreements such as the pending one with Colombia, the new one with Central America, or the established one with Canada and Mexico. Exports from the United States to other countries create jobs for Americans. Imports make goods available to Americans at lower prices and are a particular benefit to families and individuals with low incomes. International trade is also a powerful source of strength in a weak economy. In the second quarter of this year, for example, increased international trade did far more to stimulate the U.S. economy than the federal government’s “stimulus” package.

    Ironically, rather than supporting international trade, Barack Obama is now proposing yet another so-called stimulus package, which would do very little to grow the economy. And his proposal to finance the package with higher taxes on oil would raise oil prices directly and by reducing exploration and production.

    We are equally concerned with his proposals to increase tax rates on labor income and investment. His dividend and capital gains tax increases would reduce investment and cut into the savings of millions of Americans. His proposals to increase income and payroll tax rates would discourage the formation and expansion of small businesses and reduce employment and take-home pay, as would his mandates on firms to provide expensive health insurance.

    After hearing such economic criticism of his proposals, Barack Obama has apparently suggested to some people that he might postpone his tax increases, perhaps to 2010. But it is a mistake to think that postponing such tax increases would prevent their harmful effect on the economy today. The prospect of such tax rate increases in 2010 is already a drag on the economy. Businesses considering whether to hire workers today and expand their operations have time horizons longer than a year or two, so the prospect of higher taxes starting in 2009 or 2010 reduces hiring and investment in 2008.

    In sum, Barack Obama’s economic proposals are wrong for the American economy. They defy both economic reason and economic experience.


    Robert Barro, Harvard University

    Gary Becker, University of Chicago

    Sanjai Bhagat, University of Colorado

    Michael Block, University of Arizona

    Brock Blomberg, Claremont-McKenna University

    Michael Bordo, Rutgers University

    Michael Boskin, Stanford University

    Ike Brannon, McCain-Palin 2008

    James Buchanan, George Mason University

    Todd Buchholtz, Two Oceans Fund

    Charles Calomiris, Columbia University

    Jim Carter, Vienna VA

    Barry Chiswick, University of Illinois at Chicago

    John Cogan, Hoover Institution

    Kathleen Cooper, Southern Methodist University

    Ted Covey, McLean VA

    Dan Crippen, former CBO Director

    Mario Crucini, Vanderbilt

    Steve Davis, University of Chicago

    Christopher DeMuth, American Enterprise Institute

    William Dewald, Ohio State University

    Frank Diebold, University of Pennsylvania

    Isaac Ehrlich, State University of New York at Buffalo

    Paul Evans, Ohio State University

    Dan Feenberg, NBER

    Martin Feldstein, Harvard University

    Eric Fisher, California Polytechnic State University

    Kristin Forbes, MIT

    Timothy Fuerst, Bowling Green State University

    Diana Furchtgott-Roth, Hudson Institute

    Paul Gregory, University of Houston

    Earl Grinols, Baylor University

    Rik Hafer, Southern Illinois University Edwardsville

    Gary Hansen, UCLA

    Eric Hanushek, Hoover Institutions

    Kevin Hassett, American Enterprise Institute

    Arlene Holen, Technology Policy Institute

    Douglas Holtz-Eakin, McCain-Palin 2008

    Glenn Hubbard, Columbia University

    Owen Irvine, Michigan State University

    Mike Jensen, Harvard University

    Steven Kaplan, University of Chicago

    Robert King, Boston University

    Meir Kohn, Dartmouth

    Marvin Kosters, American Enterprise Institute

    Anne Krueger, Johns Hopkins University

    Phil Levy, American Enterprise Institute

    Larry Lindsey, The Lindsey Group

    Paul W. MacAvoy. Yale University

    John Makin, American Enterprise Institute

    Burton Malkiel, Princeton University

    Bennett McCallum, Carnegie-Mellon University

    Paul McCracken, University of Michigan

    Will Melick, Kenyon College

    Allan Meltzer, Carnegie-Mellon University

    Enrique Mendoza, University of Maryland

    Jim Miller, George Mason University

    Michael Moore, George Washington University

    Robert Mundell, Columbia University

    Tim Muris, George Mason University

    Kevin Murphy, University of Chicago

    Richard Muth, Emory University

    Charles Nelson, University of Washington

    Bill Niskanen, Cato Institute

    June O’Neill, Baruch College, CUNY

    Lydia Ortega, San Jose State University

    Steve Parente, University of Minnesota

    William Poole, University of Delaware

    Michael Porter, Harvard University

    Barry Poulson, University of Colorado, Boulder

    Edward Prescott, Arizona State University

    Kenneth Rogoff, Harvard University

    Richard Roll, UCLA

    Harvey Rosen, Princeton University

    Robert Rossana, Wayne State University

    Mark Rush, University of Florida

    Tom Saving, Texas A&M University

    Anna Schwartz, NBER

    George Shultz, Stanford University

    Chester Spatt, Carnegie-Mellon University

    David Spencer, Brigham Young University

    Beryl Sprinkle, Former Chair Council of Economic Advisers

    Houston Stokes, University of Illinois in Chicago

    Robert Tamura, Clemson University

    Jack Tatum, Indiana State University

    John Taylor, Stanford University

    Richard Vedder, Ohio University

    William B. Walstad, University of Nebraska

    Murray Weidenbaum, Washington University in St. Louis

    Arnold Zellner, University of Chicago
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  2. #2  
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    But why should that matter? At least he's not Bush. He's a great speaker and the rest of the world loves him!
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