Opinion: America must avoid Europe's toxic tax remedy
The looming fiscal cliff, with four times more tax increases than spending cuts, would reduce growth, not debt, SAIS student writes
Matthew Melchiorre, who is pursuing an M.A. in international economics and international relations at the Johns Hopkins University Paul H. Nitze School of Advanced International Studies, wrote an op-ed that appears in USA Today today about the perils of the looming "fiscal cliff."
In it, Melchiorre compares the U.S.'s deficit reduction solution that will be automatically triggered on Jan. 1—the so-called "fiscal cliff"—to failed recent economic remedies in Europe, noting that both include moderate spending cuts paired with substantial tax increases. In Europe, this path has "driven the economies of the Old World into the ground," Melchiorre writes, and he foresees a similar outcome for the U.S. unless "Congress keeps Uncle Sam out of Americans' wallets and takes a chainsaw to Washington's budget."
Melchiorre, the Warren T. Brookes Journalism Fellow at the Competitive Enterprise Institute, also recorded a podcast for CEI in which he discusses what needs to be done in Europe and in the U.S. to avoid fiscal catastrophe.
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Tax increases don't bring about prosperity. Shrinking government to live within its means does. America's Founders settled our republic on the principle of learning from Europe's mistakes. Let's hope President Obama and Congress heed their wisdom.