I actually think we can do better than 3.5 percent on average, but nevertheless I like the thinking of U.S. Sen. Bill Cassidy. You may recall that he defeated Democrat Mary Landrieu in last year's Louisiana Senate race - one of the Republican wins that gave the GOP the Senate majority and ended Harry Reid's reign of terror in the upper chamber.
But Cassidy is doing more than that. He is proposing real solutions to the horrendous economic performance we talked about on Wednesday - a track record that has seen us consistently fall below historical averages throughout the Obama presidency. Writing in the Wall Street Journal along with economics writer Louis Woodhill, Sen. Cassidy hits some of the same points I've been talking about for years:
It’s important to be realistic about the future, but 2.3% growth is fatalistic, not realistic. President Obama and the Congress should be agreeing on what it takes to achieve 3.5% growth. Looking at Social Security Trustees’ reports, 3.5% is the rate of growth required to ensure the solvency of Social Security and Medicare, with no tax increases and no benefit cuts.
There are tangible steps we can take toward a pro-growth economy. One step is to reform the uncompetitive corporate tax code, as recommended by President Obama’s Bipartisan Debt Commission, among others, including the repatriation of overseas profits without any additional taxation. Increase oil and natural gas exports, which the National Association of Manufacturers estimates would raise 2020 GDP by as much as 1%, while reducing unemployment by 0.5% due to an increase in manufacturing jobs. Rein in the EPA’s animus for fossil fuels. Replace ObamaCare with a plan that lowers, rather than raises, the cost of employment, and which does not incentivize businesses to lay off low-wage workers or cut their hours.
As you know, I prefer to use the word "replace" rather than "reform" when we're talking about the tax code. The whole thing is rotten to the core and it needs to be thrown out so we can start from scratch. But I think Sen. Cassidy gets the basic idea, especially when it comes to the taxing of repatriated profits. You don't hear much talk about this, but it basically means that U.S. companies who earn profits overseas can't bring that money home without forking a lot of it over to the federal government. As a result, they keep all that capital abroad, which robs the U.S. economy of crucial resources that could be fueling all kinds of positive activity.
He is also right about oil and gas exports. It's short-sighted not to take advantage of the demand that exists on world markets. If the concern is that we won't have enough to use at home, the solution to that is to produce more and to take advantage of what we can earn on world markets to increase our buying power in dealing with foreign suppliers.
And of course Sen. Cassidy, a physician, is right about the perverse incentives inherent in ObamaCare.
We need more of this kind of thinking from Republicans in Washington, and it would be nice to hear it from our presidential candidates as well. There was a time when Republicans know how to sell these ideas to the nation, so they could implement the policies and have the public's support in doing so. That is still possible. We just need this thing called leadership. It looks like Sen. Cassidy represents at least one new-generation Republican who understands that.
