Opinion

Living in an Economic ‘Twilight Zone’

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Posted: Jan 18, 2018 12:01 PM
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Living in an Economic ‘Twilight Zone’

In a White House press briefing last week, Treasury Secretary Steve Mnuchin made numerous comments about the economy and where things are going. One reporter asked about the national debt. Mnuchin answered by referring to the incredible growth the country is experiencing, which he said is likely to continue. Mnuchin also mentioned the positive impact of less regulation and tax reform. 

There’s no denying that this economy is on track for growth like we haven’t seen for more than 15 years. Keep in mind that, with GDP alone, we hadn’t seen a 3 percent increase for 12 years (it hit 3.3 percent for the third quarter of 2017). I would agree with Mnuchin that growth will go a long way to help reduce the national debt. But the idea that growth alone will get our national debt in line is naïve at best.  

I couldn’t help but think that this is a man who is likely a pretty good businessman. Yet, he remains a bit out of touch with what is necessary for sustained economic growth. I am reminded that we have had Democrats and Republicans in Washington, D.C., who for a long time have lived in an altered universe. They rationalized that we could either spend our way into prosperity, or come up with clever ways to grow our way into total prosperity while ignoring our debt. In either scenario, depending on the party in control, we would supposedly solve all of our debt problems, labor participation problems, and concerns about wages and inflation. 

Creation of growth in the economy is one of our nation’s biggest priorities. It is one of the greatest drivers in reducing the size of our national debt as we grow a sustainable and stronger economy. But we can’t—and will not—have sustainable growth, prosperity and economic stability without a strong, detailed and unwavering plan to downsize the federal government. 

My fear is that in all our enthusiasm to achieve economic growth, higher wages, more people working and more opportunities for people to realize the fruits of the American dream, we will ignore another necessity. While all these factors will create a thriving economy, we cannot ignore the need to simultaneously shrink the size of government. We cannot believe that spending our way into prosperity, along with the gross tax revenues a healthy economy generates, is going to be sustainable in future generations.

I believe this administration has done more for economic growth over the last 12 months than any administration has for the past 16 years. For this improvement to continue for future generations, and for conservatives to keep Washington and America on course—not to something new, but back to where it once was—we must cut costs, the national deficit and the size of the federal government. That is why I hope to soon see a plan to reduce our national debt.

It seems that the idea of cutting government spending is something Republicans want to keep secret, rather than use it to lend credibility to President Trump’s plan. This president is on track to be one of the greatest economic presidents in the history of this nation. But make no mistake about it: deficits, balanced budgets and sound fiscal policy won’t happen if we don’t cut spending (with the exception of the Defense Department). 

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We won’t create big surpluses and generations of prosperity without a plan for spending cuts that will help reduce the size of the deficit. In years to come, conservative and moderate voters will support administrations that will continue a pro-growth, low-debt environment. It is the one issue that will be hard for any candidate to run against.

More importantly, these are things that will help create a successful economic plan to get America back on track. The Twilight Zone-like notion that somehow we can continue on a course of addictive deficit spending will be water on the fire of growth.

More than ever, I am enthused about the economic condition of America and this administration. Part of that enthusiasm and excitement comes with knowing that we could have conservatives firmly in control of our government for generations. Still, we must start emphasizing the message that less debt, fewer regulatory burdens, and a smaller and less intrusive government are the keys to sustaining an economy that will keep America great.