11 months ago
Monday, September 22, 2008
I know I'm a democrat, I know that I favor progressive taxation, I know that I'm a "Bleeding Heart Liberal" who thinks it's an abomination that we have even 1 poor person in the US... but we need to not forget in this time of trouble that financial freedom (and the invisible hand) are what have allowed the United States to be as wealthy as it is. While I believe in taxing the rich we need to be careful to do it as little as possible, to allow the market economy to do its thing and raise the standard of living of ALL of us. I wonder if we haven't gotten carried away in the current recession. The chart above is the latest depiction of one of the most famous studies in the history of economics (Gwartney, Lawson and Block 1996), it found that the freer the economy (less nationalization, less taxation, less tariffs) the wealthier the country is per person. It is the "proof" that the economics of Smith/Laisez-Faire is what made us wealthy in the first place, and what we need to employ to get out of this jam. Image borrowed from the PowerPoint here.