July 1, 2011

A Job for the Private Sector

Antony Davies

Senior Affiliated Scholar

The stagnation we’ve been seeing for the past year or more is due to uncertainty. Consumers are less willing to make long-term investment and purchase decisions because of uncertainty over the future tax climate.

Rhetoric about taxing “the rich” is increasing, defining “the rich” down to those with middle class incomes. Tax increases are disguised by calling them “fees” and “credit reductions,” and spending increases are disguised by calling them "reductions" when they are less than they would have been otherwise.

Congress cannot create jobs, but it can help the private sector create jobs by reducing uncertainty by passing legislation to prohibit the government from interfering in bankruptcies and limiting total government spending to 18 percent of GDP.

Entrepreneurs are less willing to invest in creating new businesses because of uncertainty over the competitive environment due to increased regulatory activity and the government’s apparent penchant for deciding what products we should and should not be buying.