It is interesting that the net effect of tax reduction compared to that of government-directed stimulus spending is similar when it comes to the amount of money that gets into the economy. That, however, is where the similarity ends (“Geithner: Renewal of tax cuts for wealthy unlikely,” Web, News, Sunday).
Government stimulus money directed to lawmakers’ favorite industries through government-directed grants and pork provisions get blasts of cash that are nonsustaining. When that money is gone, it’s gone forever.
On the other hand, when taxes are low and money is available for investment, the result is self-sustaining.
The majority of jobs created in recent history are created by smaller businesses that become successful and grow. If risk-taking entrepreneurs have money to invest, they will be the ones to bolster the economy.
Just as President Obama wants to encourage new green industries to develop, there are other industries that are developing, creating jobs and contributing to the great success that is the American economic model. Mr. Obama is directing money to his pet interests through various grants and tax incentives, while the other new industries are on their own.
When government gets involved, everything slows down. We need to free up capital and creativity by letting our free-enterprise system work, as it has for a long time.
CHRISTOPHER S. MOODY