Many readers have asked that I propose some solutions to the problems, outlined in this column last week, of chronic and almost constant inflation.
I did propose, as I have here and elsewhere before, that I think the budget deficit has to be reduced with taxes on elective spending, and the economy stimulated with reduced income taxes. Elective spending is anything that is entirely optional, such as restaurant meals, holiday travel, automobiles above a certain cost and most financial transactions — but not groceries, children’s or work clothes, gasoline or fuel needed for work or home.
Part of our economic problem throughout the West has been over-reliance on a service economy that does not really add value (such as most legal and consulting bills), and on consumer spending for quickly or instantly depreciating assets. You knew George Bush Sr. was on the political skids when his economic message at the…
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