The right conditions can help all prosper
Published 9:47 pm Thursday, October 31, 2019
To the editor:
Re: “Choking out small business,” column by Ross Reitz, published Oct. 24.
There are a myriad of reasons for the fall of the Roman Empire; internal moral and political decline, overextension of its military and external attacks from barbarians. Economically, it was over-taxation and debt spending, partly because of costly wars, that contributed most to Rome’s decline. Volumes have been written on this very subject, more than we can attempt to add in an editorial, so I will address the author’s points regarding economic policy.
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Misrepresenting “low taxes and deregulation” as the primary reason of the fall of the Roman Empire is not only disingenuous and incorrect, it comes across as a political talking point rather than a serious explanation of history.
First, excessive regulation hurts all businesses, not just “small businesses,” and calling for the “super-rich” to pay their “fair share” of taxes, is an overly used fallacy called an appeal to emotion. In the U.S. progressive tax system, the top 1 percent of earners already pay the majority of all federal income taxes (37 percent) and have the highest effective tax rate (27 percent), according to 2018 tax data. The bottom 50 percent account for only 3 percent of total income tax revenue, and 44 percent pay no federal income taxes at all. Who, then, is paying their “fair share”?
Second, employees leave businesses for many reasons, one of which is health care. More people have health care coverage under the Affordable Care Act, but at what cost? Small businesses continue to have fewer options with higher premiums or have had to give up their primary care doctors to switch to a marketplace with increasingly fewer options. Calling for “Medicare for all” as a panacea, is another appeal to emotion using a faulty argument.
Third, we are in agreement that the U.S. national debt ($22.6 trillion as of September 2019), is a looming crisis, primarily because it has eclipsed gross domestic product on an annual basis. However, there are many factors that have contributed to the U.S. national debt problem; it is not simply a lack of income tax revenue or low interest rates. One of the biggest contributors to the mounting national debt is deficit spending, a Keynesian or demand-side fiscal economic policy that, while capable of driving short-term economic growth, is unsustainable in the long run.
Lastly, the argument that God’s laws dictate the equalization of wealth is a red herring. If anything, God’s laws emphasize enjoying the fruits of one’s labor, but that economic disparity will exist in society. A Godly people should strive toward voluntary benevolence toward others, not advocate for government mandates of wealth equalization or redistribution.
The best way to help small businesses is to employ supply-side economic policies that create incentives for all businesses. If we are to learn from history, it is that tax and spend policies and excessive regulation do not create these incentives. Decreased government regulation, not excessive regulation. Reduced federal spending, not increased taxation. These are the type of economic policies that create conditions for all businesses to prosper.