Suddenly, Saving Is Good
Written by Brian Garst, Posted in Economics & the Economy, Taxes
The Obama administration has consistently parroted the Paul Krugman view of economic recovery: spend, spend, spend. Based on faulty Keynesian economics, this demand-side framework thinks too much saving is a bad thing. According to this Krugman approved theory, there is a global savings glut and if America starts saving too then we’ll all be doomed!
This kind of Keynesian claptrap has dominated the administration’s economic thinking to date. Yet now the President has inexplicably decided that saving is good, and therefore we need more of it:
The government is trying to make it easier for Americans to save for retirement, President Obama said Saturday, as he noted the toll the recession has taken on extra income and savings accounts.
One initiative will allow people to have their federal tax refunds sent as savings bonds. Others are meant to require workers to take action to stay out of an employer-run savings program rather than having to take action to join it.
If the President is serious, I have a simple suggestion to encourage greater savings in America: lower taxes and let Americans keep more of the money they earn.
I serve as Vice President of the Center for Freedom and Prosperity, a non-profit think tank dedicated to preserving tax competition and free markets. This site features my personal views, which are not reflective of CF&P.