Dec. 12, 2012, Oakland, CAAs Washington remains deadlocked over a compromise that would avoid the Fiscal Cliff, 185 leading economists joined together in an open letter to Congress released today, calling for clear and concise action: oppose higher taxes, set budget priorities, and get to work on reforming Americas tax and entitlement programs. Independent Institute President, David Theroux, was among the expert signatories, organized by the National Taxpayers Union (NTU) who voiced their support for responsible policy that would cut spending rather than raise taxes, which would have a significant, negative impact on the economy.
In their statement, the diverse group of 185 members of the economics community advised against allowing the 2001 and 2003 tax relief laws expire for some or all taxpayers. They further contended broad tax and budget reform offers a better route that would avoid the negative consequences, such as job losses, of short-term revenue grabs:
Low taxes can have a constructive economic effect by keeping money in the private sector, where it is far more likely to be utilized for efficient purposes. By contrast, raising taxes would divert resources into the relatively inefficient public sector, thereby curbing potential job creation and economic growth. This effect would be even more pronounced during a persistent slump.
Signers joining the Independent Institute President David Theroux and the NTU include former Congressional Budget Office Director (and current American Action Forum President) Douglas Holtz-Eakin; former Office of Management and Budget Director Jim Miller; as well as scholars from a variety of academic entities, including the University of Michigan, University of Chicago, UCLA, University of Virginia, Emory University, Georgetown, Pomona College, and the Wharton School at University of Pennsylvania (affiliations on the letter were listed for identification purposes only). Signatories with other institutions included Donald Luskin of Trend Macrolytics, Richard W. Rahn of the Institute of Global Economic Growth, and David G. Tuerck of the Beacon Hill Institute at Suffolk University.
David Theroux strongly reiterates his support for this collective effort and the need for a sound, principled stand from free-market leaders.
Throughout the current Great Recession, The Independent Institute has been a beacon of sense in the fog of calls to do something when much of what the government had already done created the mess in the first place. If we do nothing, Washington will pursue ever greater tax and spending policies that will only exacerbate and deepen the next financial crisis.
To arrange an interview with David J. Theroux, please contact Lindsay Boyd at 202.725.7722 orálboyd@independent.org.
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