Want A Booming Economic Future? Look To The Pro-Growth Policies Of The Past

Both Republicans and Democrats have set us on a path of low growth, high inflation, and massive deficits at the national level. A new Republican majority is in the U.S. House, and the difficult debt ceiling battle over the bloated $31.4 Trillion National debt is almost entirely due to excessive spending. There’s a proven progrowth and pro-liberty path.

The U.S. experienced a real GDP growth rate of 3% in 2022 Just 0.9 percent (Q4 over-Q4), The highest inflation in 40 yearsThe highest mortgage rates in 20 yearsThe worst stock market in the world. 14 years. Now, the average weekly real earnings are For 22 consecutive months, the year-over-year decline was greater than in previous years. 

History is a great guide to how to get out of this mess. Although 50 years apart, the two of us served as chief economists at OMB. Arthur Laffer, who is the inventor of the acronym, is one of us. “Laffer Curve”) was the first chief economist of the OMB in the Nixon White House. Vance Ginn, the other associate director for economic policies at the OMB under the Trump White House was the last.

The problems of today are the same, even though much has happened since the OMB was created in 1970. It is still a problem that there are many unjustifiable government expenditures, prosperity-killing taxes, unwarranted regulation, excessive liquidity, and harmful interference with international trade. However, just because we have had counterproductive economic policies for so long doesn’t mean that we shouldn’t strive for a better world. 

Each of the areas mentioned above is the subject matter of intense debate. These debates in politics have their short-term winners or losers, as determined by elections. However, the principles of economics don’t depend on votes. Economic malaise can be solved by less government and not more. The cure is free-market, progrowth policies. 

Historic Lessons

The 1970s are now known as the “era of stagflation”, and 2020s could be just as bad. Many people, despite 50 years of experience have not learned a lesson. 

The economy was crushed at every turn during the Nixon-Ford administrations. Higher inflation was caused by the devaluation of the dollar and its removal from gold. Wage and price controls were then imposed, which did not stop inflation but rather destroyed the economy. The government spending was out of control. The wisdom of the D.C. crowd was to raise taxes and impose tariffs, including a 10% import tax surcharge. 

The results were increasing inflation, stock market collapses, impeachment and a weak economic environment. Next, President Jimmy Carter attempted to do even more with the same results. 

A true revival followed, led by President Ronald Reagan’s tax and regulatory reductions and Federal Reserve Chairman Paul Volcker’s sound monetary policy. Reagan won reelection with a huge victory, winning 49 states. 

Then there was George H.W. Bush broke his promise and raised taxes to get a one-term term, leading to the end of his presidency. 

President Bill