Trump Stares Down N. Korea/ Tax Cuts will Energize Economy

President Trump has decided to put an end to decades of threats and intimidation by communist North Korea. He is not going to kick the can down the road until the road ends with North Korea armed with both nuclear weapons and the capability to deliver them onto South Korea, Japan and even the United States.

The North Korean dictator is a genocidal bully but he also is a coward. It is a known two-sided psychological phenomenon. Trump knows this and is pushing Kim Jong Un back into his impoverished hole using a show of American military strength as a prod.

This dictator knows that he is no match for American power. He knows that he has finally met a leader whom he cannot bluff. This realization certainly is creating enormous tension within the North Korean military government.

With the help of China, which Mr. Trump wisely cultivated on president Xi’s visit to Florida, and with Trump’s fearless tone, believes that forces within the North Korea military may well see that the jig is up and will overthrow and kill Kim and give up their nation’s nuclear weapons. Otherwise they see a grim future ahead with even China now backing away from subsidizing their long-dead communist revolution.

By treating the North Korean situation seriously president Trump is showing real leadership. His recent top-secret meeting with all of the US senators over North Korea not only was strategically important, but also was part of Trump’s smart psychological-warfare tactic. This powwow certainly caused great concern among the communists.

President Ronald Reagan brought down the Soviet Union without firing a shot because Reagan knew that the communists were putting on a big show of power but were very weak economically. President Trump surely is looking at the Reagan playbook for dealing with a vastly weaker and poorer enemy in North Korea, and knowing that he will win. (The US has a $20 trillion annual economy. North Korea is a paltry $25 billion. Capitalist and free South Korea is $1.5 trillion.)

Now here is today’s second commentary:

Trump Tax Cuts Will Energize the Economy

President Trump’s plan for “massive” tax cuts will expand the economy and the middle class. Along with his strategy to revive wealth-producing manufacturing jobs in the United States, he is taking all the right steps for a better economic future.

The three biggest economic booms in world history – in the United States in the 1920s, 1960s and 1980s – were all sparked by major tax reductions, particularly on wealthy Americans and on business. It is a proven fact throughout history that low taxes spur economic growth and that high taxes thwart growth.

Here is an example that we all have witnessed ourselves: When sales taxes are suspended for shoppers on a ‘tax free’ weekend, economic activity increases significantly. On the other hand liberals increase taxes on products that they oppose like cigarettes in order to suppress sales.

Here’s another example: In 1990 the federal government imposed a special luxury tax on yachts. This was intended to get more money for the government while forcing wealthy people to pay their “fair share” in taxes.

Did this cause revenues to the government from yacht sales to spike upward?

Nope. The opposite happened. Rich people stopped buying yachts and the yacht-building industry lost thousands of jobs. Tax revenue to the government from yacht sales actually fell.

The examples are endless. Meanwhile the media and their Democrat friends are dragging out their tired old canard that Trump’s tax rate reductions will increase the national debt since less tax money will allegedly be going to the government with lower rates.

This is the opposite of the truth. Under Republican president Ronald Reagan top tax rates were reduced from 70% to 28%. Democrats claimed that this would reduce tax revenue to the government significantly but in fact revenues to the government actually increased by 91% over 8 years as a result of increased economic activity. The size of the American economy almost doubled. This happened since the tax rate reduction freed up huge amounts of capital which went into the private economy, stimulating it significantly.

After all, if rich people keep more of their own money they spend it. And this helps people who build and sell yachts or who sell artworks or who operate or work in fine restaurants or who sell or service luxury cars. This wealth is then flushed out into the general economy. The same happens all over again with middle class tax relief.

If you want to read a analysis of the Reagan economy using real facts and figures, go here.

In 1923, under Republican president Calvin Coolidge, Treasury secretary Andrew Mellon reduced the top tax rate from 63% to 25% and set off an historic economic boom called The Roaring 20s.

In contrast the crawling Obama economy built on massive government spending, deficits and debt expanded by only about one-third over 8 years while the national debt doubled. American taxpayers now fork over almost $500 billion per year just to pay interest on that debt.

Our federal debt ratio was twice as high when Obama left office as it was when Ronald Reagan left office. This is why Trump wants to stimulate the economy and cut spending, in order to bring the debt down naturally.

President Trump plans to cut taxes on the hard-working middle class. This is long overdue. These people are carrying way too heavy a burden and cutting their rates is not only fair but also will help the economy. He also plans to cut taxes on high-income earners from 39% to 35% and to eliminate the Alternative Minimum Tax and the Death Tax. Wonderful. More money for the private economy.

Another significant part of the Trump plan is a reduction in the corporate tax rate from the highest in the world (35%) down to 15%. This will encourage corporations to return their factories, jobs and assets to the US and give our economy a huge boost. Even tax-crazy Japan lowered its corporate rate to inject some growth into its dismal economy.

Businesses make decisions based on their bottom line. They avoid high taxes when possible. This is why 1,700 businesses and their jobs are reported to have departed high-tax California in the last 10 years including major companies like Intel, Toyota and Nestle. They have fled to lower-tax states like Texas, Utah, Georgia and Florida. On top of that 250,000 middle class people are reported to be fleeing California every year, while California was an economic magnet for 150 years.

If you think rationally about taxation you understand the low tax, capitalist point of view. For instance, if you were trying to decide where to live and one town had a tax rate of 50% and the other town had a rate of 25% you would pick the 25%. Natural human behavior and economic self-interest drive people to lower-tax areas and have for millennia.

The Democrat ‘solution’ for economic growth is always centered on spending taxpayer money in education, infrastructure, make-work projects, etc. The reason that Democrats select this ‘solution’ is because it requires no effort or risk – just tax and spend. It can all be done with legislation, which is all that Democrats know how to do. No factories need be built or products brought to market or hard work done.

But Obama “invested” $800 billion taxpayer dollars in the ‘stimulus’ package of 2009 and it produced hardly any growth.

Democrat president Franklin D. Roosevelt has been praised for decades by liberals for “saving” America during the economic depression of the 1930s with increased taxes and massive government spending on make-work programs like road-building and national parks.

It failed miserably. Roosevelt policies significantly lengthened and deepened the depression, like Obama’s have done. Henry Morgenthau, who was Treasury secretary under Roosevelt, spoke in 1941 about the expenditure of huge sums of taxpayer cash in an attempt to end the depression. Morgenthau said:

“We are spending more money than we have ever spent before, and it does not work. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. I say after eight years of this administration, we have just as much unemployment as when we started and an enormous debt, to boot.”

In other words, private investment produces jobs and growth while government spending does not. The major exception is military spending, which liberals despise yet which provides the biggest boost to the economy of all government spending. Interestingly the depression of the 1930s was finally ended by massive military spending for World War II, not by Roosevelt’s state-sponsored generosity.

This is also why the economy boomed in the 1980s – because president Reagan increased military spending significantly.

Trump’s tax plan also includes simplification of the tax code, which is now more than 60,000 pages long. This is a travesty. It needs to be simplified, with the Internal Revenue Service scaled back by 90% and its $12 billion annual budget cut to $1 billion. Democrats love to use the complex tax code and the menacing IRS to intimidate Americans. It is time for this to end.

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