Employers hire people when their businesses are growing, not when they’re still struggling to survive. They first need to boost their bottom line, and that means cutting their tax rates upfront.
Kemp’s enterprise zones were built on tax cuts and other incentives to draw investment, businesses and jobs into blighted areas. Sadly, his idea went nowhere in the Democratic Congress, where House Speaker Tip O’Neill buried his bill.
About the same time, ironically, China’s communist leaders were just beginning to liberalize their economy and had begun to designate major slum-infested cities for special incentives that they called “enterprise zones.”
When the White House announced Mr. Obama would unveil his plan on the anniversary of LBJ’s address, the network news media loved the idea. CBS News did a rosy report on the $30 billion Economic Opportunity Act of 1964, but they left out all of its many failures and scandals.
I dug into its programs in the 1970s as an investigative reporter for United Press International. What I discovered, with the help of sources within the program, was shocking.
Much of “the government’s anti-poverty spending went to an industry of consultants, researchers, special-interest groups, lobbyists and contractors who have been greedily feeding off the program at the expense of the poor,” I wrote at the time.
No one was more critical of the program than liberal Sen. Abraham Ribicoff, Connecticut Democrat, who was one of its original and most enthusiastic supporters.
The former secretary of health, education and welfare in the Kennedy administration, who held hearings on the program, said this about LBJ’s program in a 1972 book:
“Our antipoverty efforts failed. The philosophy of the 1960s — to provide a vast array of services to the poor — must be judged by results. There are 26 million poor Americans — not because they lack social services, advice and counseling, but because they lack money, the great equalizer.”
It was the “middlemen — not the poor,” Ribicoff said, who were prospering under the anti-poverty program.
In an interview years later, Ribicoff said, “It sounded good. But when you analyzed what’s been accomplished, the balance sheet indicates they [the programs] have generally been failures.”
Nearly 50 million Americans now live below the nation’s official poverty income line. Mr. Obama’s latest plan won’t even nick this number until our job-challenged economy is putting a lot more people back to work.
Donald Lambro is a syndicated columnist and contributor to The Washington Times.