43, Round Two

Larry Kudlow
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Posted: Jan 19, 2005 12:00 AM
On the day of his second inauguration can there be any doubt that George W. Bush is the most powerful and dominant politician on the face of the Earth? As his policies reshape the American economy and the world, he has far more clout and influence than his predecessors Bill Clinton or George H.W. Bush ever had.

The younger Bush is more like Reagan. The Gipper revolutionized the economy with tax cuts and deregulation. He had far-reaching global influence with his vision of overturning the evil empire of Soviet communism. George W. Bush is equally visionary.

At home he is promoting economic growth through two related visions: the economic power of lower tax-rate incentives and an ownership society that replaces government dependence with consumer choice and personal responsibility for retirement, health, and education. Reducing the multiple-taxation of saving and investment will increase the supply of capital that is vital to funding entrepreneurial creativity, economy-transforming technologies, and job creation. The Bush agenda also includes energy reform (especially nuclear-powered energy) and tort reform to stop the litigation abuse that decimates companies and job holders.

At the forefront of Bush?s ownership-society plan is Social Security reform through personal savings accounts. This will increase economic growth and put a dagger in the heart of government overspending. With their own Social Security retirement accounts, members of the new ownership class will generate more comfortable investment returns than government can provide while terminating the open-ended expansion of big government. Young people will get a good deal, not a raw deal.

The dirty little secret in U.S. budget policy is that Social Security payroll-tax collections are big government?s most reliable funding source. Redirecting this money back to those who earned it in the first place will force government to make due with less. The ever-growing entitlement state that has defined liberalism for the last four decades will be severely curbed. The paradigm-shift from government to the workforce will redefine the economy in this century.

Seventy years ago, FDR and John Maynard Keynes believed in overregulated capitalism. Today, sensible people believe in markets. There couldn?t be a starker contrast between this Bush view of the world and the one currently prevalent in Western Europe. Europeans derisively call Bush?s vision ?cowboy capitalism.? But the facts show that Europe would gain if it adopted Bush?s principles.

The mainstream media seldom report it, but the U.S. is once again pulling away in terms of global economic performance. GDP is rising at a 4 percent rate. Unemployment is 5.4 percent. Inflation is around 2 percent. Interest rates are low. Stock markets have been rising for over 2 years.

In foreign policy, Bush will continue to implement his vision of transformational freedom and democratization in the Middle East and elsewhere. This will change the world for centuries to come. He will remain steadfast and unyielding in the war against totalitarian radical Islamism. The Taliban and Saddam Hussein are gone. Free elections have already been held in Afghanistan and the Palestinian territories. Iraq?s election day is January 30, just moments away.

The Bush doctrine of preemption remains in place. Nations that safe-harbor terrorists could be subject to regime change. The best defense for a safe America -- now 3 years without a foreign attack on its soil -- is to go on offense against the terrorists abroad.

In his response to the tsunami catastrophe, Bush has shown America to be a kindhearted and incredibly generous nation. He deployed a bipartisan fundraising effort, spearheaded by former President Clinton and Papa Bush. Charitable donations from private businesses and individuals have been phenomenal. The use of our military assets for the distribution of food and medical care has been eye-opening. The Muslim world has taken notice of this American largesse.

George W. Bush is a man of deep religious faith and unwavering loyalty to his wife, family, and country. His own political story is remarkable. His meteoric rise began just over 10 years ago as an underdog in Texas politics. Now he stands atop the world stage. Under Bush, the Republican party is the source of almost all new ideas, with the GOP holding the whip hand to implement them. Republicans can claim the White House, Senate, House of Representatives, and a majority of state governorships. The Democrats, meanwhile, are in disarray and decay, desperately searching for new leaders and ideas. They have lost their clout.

Surely, the president will bring a strong sense of optimism to his second inaugural speech. He is no declinist or pessimist or naysayer. His simple but enormously potent message is a belief in the power of freedom at home and abroad. Freedom brings liberty and democracy to the darkest corners of the globe. Economic freedom fuels the engine of virtually limitless growth. Freedom is transforming.

Let me add, quite simply, Amen.