Advice for Obama: Listen to Winners, Not Losers

by: Katy Delay
I am a fervent capitalist, but that hasn't prevented me from complaining occasionally about the American businessman's apparent dearth of guts in the face of cumbersome big government, about their lack of idealism and economic philosophy when the going gets tough.

"If we can't beat 'em, we'll just have to join 'em," they seem to mumble as they sidle up to the nearest legislator, checkbook in hand, instead of taking the more honorable and idealistic high road of public political debate.

But Mr. Frederick W. Smith seems to be the exception to the rule.

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This CEO, instead of lining up behind our automakers and bankers at the taxpayer trough, has chosen instead to speak out in ways that make perfect common economic sense.

His idea: Instead of bailing out the failing industries, give sustenance to those that are still strong and who might actually be capable of bringing recovery to our economy. And that sustenance should not be in the form of bailouts; but in the form of overdue corporate tax code reform.

In a commentary appearing in yesterday's Financial Times, he hammers away once more at America's counterproductive, hysterical bailout policy and suggests a simple and probably much less costly remedy:

Allow "US companies to write off all their capital expenditures when they make them, as opposed to the current system of long-term depreciation. ... [O[ver time, every dollar of tax cuts for expensing adds about nine dollars of gross domestic product growth."

He explains the importance of bringing America into line with corporate tax rates abroad and the potential effect on domestic employment.

"The beneficial impact on our economy and longer-term federal tax receipts would far outweigh the relatively small near-term increase in the deficit, particularly when compared with other actions such as consumer rebates and/or increased government spending."

Never mind that it might prevent the destructive effects of current monetary "quantitative easing" and the folly of worldwide debasement of fiat currencies as our monetary authorities race each other to the bottom in an interest rate battle.

And think about this: It is one thing for Japan to try the quantitative easing formula all by itself with the rest of the world in a booming cycle; it is quite another for the whole world to do it in concert in a bust cycle.

You might like to read the interesting story of Mr. Smith's life as he tells it.

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