Additionally, the policy ushers in opportunities for millions more to join the more than half of adult Americans who already participate in the stock market. The plan essentially says to Americans not currently in the stock market, ‘Come play: You can keep what you win.’ This powerful participation incentive will pay significant dividends both for individual investors and the economy at large.
Easing the burden on millions of taxpayers is also likely to produce further economic growth—growth the United States needs to continue to lead and compete in an increasingly competitive global economy.
“As we’re saving our money and investing in the bank or investing in stocks, we’re going to help encourage the creation of new businesses and grow the businesses that already exist,” Romney said when he announced the plan. He added that business growth will ensure “growing additional jobs.”
What’s the catch? Estimates suggest the tax-free savings plan will cost the federal government $32 billion each year. Romney, however, has a plan to make up for the lost revenue: to limit growth in nondefense discretionary spending to the inflation rate minus one percentage point. Thus part of the appeal of the plan is that the “downside”—mandatory spending restraint—can hardly be considered bad policy.
The 2008 election will turn, in large part, on competing economic visions for the future of the country. The Democratic candidate will inevitably propose policies that increase the size—and consolidate the power—of government. Governor Romney, on the other hand, has a distinctly people-centered economic vision—one that sees on every Main Street corner potential investors, not future government beneficiaries. With a worldview such as this, Americans can trust that a President Romney would champion economic freedom and fiscal responsibility in Washington. That ought to be good news to the folks who attended the American Dream Summit—and to millions of other hard-working Americans across the country.
Doug Wilson is the the co-author, with Edwin Feulner, of Getting America Right: The True Conservative Values Our Nation Needs Today.
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