Daniel Henninger:


In one corner of the world you have Europe, beset by a sovereign debt crisis that's been building for 50 years. The U.K.'s new prime minister, David Cameron, promises his people years of austerity to dig out from beneath their debt. Americans, staring at fiscal crevasses opening across Europe, have to decide if they also wish to spend the next 50 years laboring mainly to produce tax revenue to pay for public workers' pensions and other public promises. The private sector would exist for the public sector.

In another corner of the world, wealth is rising from the emerging economies of the east—China, India, Korea and the rest—posing America's greatest economic challenge in anyone's lifetime. Do the American people want to throw in the towel, or do they want to compete? If the latter, the public sector has to give way to the private sector.


Barack Obama's first and biggest clarifier was his health-care plan. With Democratic majorities, it passed. Fair enough; they won the last election. But after a year spent watching the legislation, the American people said they didn't want a quasi-national health-care system. Support for the plan in the RealClearPolitics average is now 38.3%.

Now the clarifying gods have delivered a gift for the November election, the fight over taxes. Somewhere, George W. Bush must be laughing. Amid 9.5% unemployment, Democrats must deal with the expiration of the 2001 and 2003 tax cuts. They are trying to thread this needle by pushing a "middle class" extension through the hole, while impaling "the rich" on a tax spike.

In normal times, this tactic might work. But normal times are long past for America, and the voters know it. Mr. Obama himself talks all the time about the end of "business as usual." In the interests of the nation's future, Mr. Obama argues, the public economy needs to get bigger and stay bigger—currently 25% of GDP.


This is about something bigger than deficit reduction. The deficit is dangerous. But raising taxes to cut the deficit is a bailout for the spenders—until proven otherwise.

Historically the economy does best when the government takes 20 percent or less of GPD. We should have a requirement that except for war spending the government may not spend more than that 20 percent. That also means they should not collect taxes that exceed 20 percent of GPD.

My income is a long way from the top one percent, but I think it is a mistake to make the top one percent pay more than 40 percent of all income taxes. At 40 percent they are already paying more than their fair share of taxes. To raise their taxes so Obama and Democrats can continue to engage in irresponsible spending is just wrong. Greedy Democrats need to be forced to argue what percentage of taxes the top one percent should pay and not just the rate.


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