by Mitch Kokai
Senior Political Analyst, John Locke Foundation
… [T]here is still a way forward.
The legislative priorities of the new administration started with repealing ObamaCare because of the need to eliminate the complexity and burden of its 20-odd new taxes on business, families and small businesses — a total of some $500 billion-plus in additional taxes — and to abolish and reduce costly regulations on small businesses.
Meaningful tax reform that includes major simplification and reduction in rates is the key to spurring new economic growth and the repatriation of $2 trillion-plus of corporate cash held overseas.
But comprehensive tax reform is nearly impossible with ObamaCare in place — like trying to build a new structure on a fundamentally flawed foundation. Additionally, we can’t get to a key area of regulatory reform — those rules that apply to small business, which generate 70% of the new jobs in America — with ObamaCare’s regulatory burdens that kick in at 50 or more employees. …
… [A] more accurate picture of the nation’s true financial health is found in the ratio of government debt to the actual tax revenue collected, as this provides a clearer picture of the country’s debt burden and the capacity to pay. On that basis the U.S. is now the second-weakest among the OECD nations, even ranking below Greece, Portugal, Spain and Italy, and exceeded by only Japan.
Given the resistance to entitlement reform, the path of least political resistance to avoid insolvency is to dramatically revitalize growth in the U.S. economy. That is why the Trump administration’s tax and regulatory relief are so desperately needed. Hastening business formation and creating new jobs, which expand the tax base, is the key to eliminating the deficit and stabilizing the level of U.S. debt.
But what is first required is the repeal of ObamaCare. And to get the necessary votes in the Senate, President Trump needs to pull out all the stops.