No matter what your politics, it’s hard not to like former president and raconteur, Bill Clinton. However, that doesn’t necessarily mean I always agree with him. In fact, I usually disagree.
As a case in point, I take issue with something he said at the Democratic National Convention. Describing Barack Obama’s term in office, he said, “No one could have repaired all the damage he found in just four years.” Not only could another president have done it, but it could have been done within the first year in office, leaving him three years to, well, play golf if he wanted to. In fact, another president did just that –Calvin Coolidge.
Coolidge assumed the presidency after the death of Warren G. Harding in 1923, and was then elected in 1924. Knowing the stranglehold that taxes have on growth, under Coolidge’s stewardship, taxes on the wealthy were cut by more than half. According to Cal Thomas, writing for the Heritage Institute, “In 1922, the effective tax rate on the wealthy was 50 percent, who paid a total of $77 million into the Treasury. By 1927, Coolidge had cut their tax rate to 20 percent — but the same group paid $230 million in taxes.”
While cutting tax rates, Coolidge also managed to reduce the size of government and government regulations. As a result, unemployment, which was then at an all-time high for the 1920s at 6.7 percent, fell to a low of 1.8 percent in 1926 — a record that has never been matched in peacetime.
Compare Coolidge’s record to that of Franklin D. Roosevelt. FDR is always championed as the man who pulled us out of the Great Depression of the 1930s. The reality is that his domestic policy and social engineering actually prolonged the depression.
During the New Deal era of 1933 to 1940, Roosevelt spent unprecedented amounts of federal funds, yet unemployment remained at 17 percent. It took the conscription of 12 million men into the military during World War II to finally bring unemployment to an acceptable level. As economic columnist Amity Shlaes points out in “The Forgotten Man,” it took 25 years for us to fully recover.
Similarly, the Obama administration came out of the gate spending close to $1 trillion meant to stimulate the economy. Instead, economic growth remains lackluster, and unemployment remains high.
FDR also placed the iron hand of regulation firmly upon business’ back, impeding growth, product development and the rise in private-sector hiring.
True to form, the current administration added 11,327 new pages of rules to the Code of Federal Regulations. Over-regulation is an insidious, hidden tax that business pays and then passes on to the consumer. According to a U.S. Chamber of Commerce study, the total annual cost of complying with federal regulations is $1.7 trillion.
Historian Amity Shlaes, in a Forbes Magazine article, compares Coolidge with the sport of windsurfing. She concludes, “Today our government has moved so far from Coolidge’s tenets that it’s difficult to imagine such policies being emulated. But it is precisely this remove that is creating a new and national fascination with the Great Windsurfer.”
Clinton can be forgiven for saying that no one could have repaired all the damage Obama found in just four years. Conventions are, after all, a time of exaggeration, and we hear it from both sides. Besides, Clinton has also been known to stretch the truth from time to time. Who could ever forget, “I did not have sex with that woman”?
In the following address, Coolidge expresses his philosophy of economic freedom.
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