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Opinion: Fiorina understands what the U.S. economy needs to grow
MarketWatch
Caroline Baum
8/12/2015
Excerpt:
Last week’s first Republican presidential debate, a two-tiered meet-and-greet affair for the TV audience, produced winners, losers and its share of tense moments.
Businesswoman Carly Fiorina was the hands-down winner of the JV debate, an audience-free Q&A with the seven candidates who didn’t make the top-10 cut. Fiorina was poised, knowledgeable and precise in her responses. She comes across as honest, which is more than one can say about that other woman running for president.
Fiorina doesn’t recoil when asked about her record as CEO of Hewlett-Packard and her 2005 sacking by HP’s board of directors. She gracefully fends off “gotcha” questions, including one on her failure to qualify for Fox’s A-team debate. “At this point in previous presidential elections, Jimmy Carter couldn’t win, Ronald Reagan couldn’t win, Bill Clinton couldn’t win, and neither could’ve Barack Obama,” Fiorina said. Zing.
Like the other 16 GOP presidential hopefuls, Fiorina has yet to release details of her stated plan to get the U.S. economy moving. But we can piece together some key areas and initiatives from recent interviews.
Rand Paul Blasts Trump, Washington Conservatives(4:04)
On taxes, Fiorina would lower every rate, close every loophole — maybe retain a few that benefit the middle class — and shrink the 75,000-page U.S. tax code to three pages. She’s correct when she says that most of the deductions and exemptions benefit the wealthy, powerful and well-connected. Why? To paraphrase F. Scott Fitzgerald, the rich are different than you and me: They have better tax lawyers.
I wish her luck. Politicians of all stripes advocate tax reform, yet nothing gets done. The only way to lower the corporate tax rate, which at 35% is the highest in the developed world and a disincentive to business, is to close various loopholes.
Better known as tax expenditures to budget wonks, these carve-outs cost the government more than $1 trillion a year in lost revenue. Each loophole has a well-organized, well-funded constituency behind it. Among the largest are the exclusion of employer-provided health insurance, 401(k) and other retirement plans; the mortgage-interest deduction; and the lower rate on capital gains.
The elimination of tax expenditures would simplify the tax code and, at the same time, “reduce incentives for activities that have been encouraged” by it, according to the Government Accountability Office.
That seems like an opening for someone with Fiorina’s talents. If we can’t agree on the proper role for the tax code — to fund the necessary functions of the federal government, or to provide incentives for behavior deemed “good” by our bought-and-paid-for elected officials — no wonder tax reform gets lost in committee.
Probably the most controversial statement Fiorina has made on the economy — hardly controversial to conservatives — is that progressive policies contribute to income inequality. Economists call it the law of unintended consequences. Government may mean well, but its actions have the opposite effect to what was intended.
Take the minimum wage, for example. Everyone would like all Americans, regardless of their background, to be able to earn a decent wage and prosper. But mandating a higher minimum leaves some workers without a job and others unable to get a foot in the door, even if it’s a job flipping hamburgers. Just pick up any economics textbook to understand the adverse effect of price floors and ceilings. And no, new studies that purport to show that a higher price (of labor) doesn’t reduce demand are just plain bogus.
Fiorina understands that the engine of growth is small business, and especially startups.
New business formation dropped by 30% from its 2006 peak to its 2010 low and has shown only slight signs of recovering, according to the Kauffman Foundation. New firms accounted for 8.3% of all businesses in the post-recession period, the smallest share in decades. Because new businesses are the key to employment, innovation and productivity, regulations that make starting a business too costly affect the entire nation.
Fiorina wants to roll back some of the regulatory burden.
With her business acumen and fluency on the issues, Fiorina is well-suited to correct the misperception that conservatives are bad people because they oppose initiatives such as an increase in the minimum wage.
................................................
View the complete article, including links and image at:
http://www.marketwatch.com/story/fio...row-2015-08-12
MarketWatch
Caroline Baum
8/12/2015
Excerpt:
Last week’s first Republican presidential debate, a two-tiered meet-and-greet affair for the TV audience, produced winners, losers and its share of tense moments.
Businesswoman Carly Fiorina was the hands-down winner of the JV debate, an audience-free Q&A with the seven candidates who didn’t make the top-10 cut. Fiorina was poised, knowledgeable and precise in her responses. She comes across as honest, which is more than one can say about that other woman running for president.
Fiorina doesn’t recoil when asked about her record as CEO of Hewlett-Packard and her 2005 sacking by HP’s board of directors. She gracefully fends off “gotcha” questions, including one on her failure to qualify for Fox’s A-team debate. “At this point in previous presidential elections, Jimmy Carter couldn’t win, Ronald Reagan couldn’t win, Bill Clinton couldn’t win, and neither could’ve Barack Obama,” Fiorina said. Zing.
Like the other 16 GOP presidential hopefuls, Fiorina has yet to release details of her stated plan to get the U.S. economy moving. But we can piece together some key areas and initiatives from recent interviews.
Rand Paul Blasts Trump, Washington Conservatives(4:04)
On taxes, Fiorina would lower every rate, close every loophole — maybe retain a few that benefit the middle class — and shrink the 75,000-page U.S. tax code to three pages. She’s correct when she says that most of the deductions and exemptions benefit the wealthy, powerful and well-connected. Why? To paraphrase F. Scott Fitzgerald, the rich are different than you and me: They have better tax lawyers.
I wish her luck. Politicians of all stripes advocate tax reform, yet nothing gets done. The only way to lower the corporate tax rate, which at 35% is the highest in the developed world and a disincentive to business, is to close various loopholes.
Better known as tax expenditures to budget wonks, these carve-outs cost the government more than $1 trillion a year in lost revenue. Each loophole has a well-organized, well-funded constituency behind it. Among the largest are the exclusion of employer-provided health insurance, 401(k) and other retirement plans; the mortgage-interest deduction; and the lower rate on capital gains.
The elimination of tax expenditures would simplify the tax code and, at the same time, “reduce incentives for activities that have been encouraged” by it, according to the Government Accountability Office.
That seems like an opening for someone with Fiorina’s talents. If we can’t agree on the proper role for the tax code — to fund the necessary functions of the federal government, or to provide incentives for behavior deemed “good” by our bought-and-paid-for elected officials — no wonder tax reform gets lost in committee.
Probably the most controversial statement Fiorina has made on the economy — hardly controversial to conservatives — is that progressive policies contribute to income inequality. Economists call it the law of unintended consequences. Government may mean well, but its actions have the opposite effect to what was intended.
Take the minimum wage, for example. Everyone would like all Americans, regardless of their background, to be able to earn a decent wage and prosper. But mandating a higher minimum leaves some workers without a job and others unable to get a foot in the door, even if it’s a job flipping hamburgers. Just pick up any economics textbook to understand the adverse effect of price floors and ceilings. And no, new studies that purport to show that a higher price (of labor) doesn’t reduce demand are just plain bogus.
Fiorina understands that the engine of growth is small business, and especially startups.
New business formation dropped by 30% from its 2006 peak to its 2010 low and has shown only slight signs of recovering, according to the Kauffman Foundation. New firms accounted for 8.3% of all businesses in the post-recession period, the smallest share in decades. Because new businesses are the key to employment, innovation and productivity, regulations that make starting a business too costly affect the entire nation.
Fiorina wants to roll back some of the regulatory burden.
With her business acumen and fluency on the issues, Fiorina is well-suited to correct the misperception that conservatives are bad people because they oppose initiatives such as an increase in the minimum wage.
................................................
View the complete article, including links and image at:
http://www.marketwatch.com/story/fio...row-2015-08-12