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Tag Archives: debt

Lanhee Chen: A Spending Problem

single-payer

President Trump earned significant praise for his first State of the Union Address—and for good reason. It presented an affirmative vision for what unified Republican governance can accomplish. It also laid out policy priorities to keep the homeland secure and strengthen our economy. One thing that was missing, however, was any mention of our growing deficits and national debt. Washington is spending more money than it has and more than it should—and lawmakers from both parties seem perfectly content to continue on the path we’re on. This spending requires us to borrow money from foreign adversaries, hurts our economy’s ability to grow and leaves our kids and grandkids with the bill.

 

A change in course is desperately needed. Indeed, reining in spending is never politically easy. That’s why it will take a leader willing to buck trends and attack the special interests—and perhaps even some in his own party—to get the job done.

 

Here’s to hoping that Donald Trump can be that leader.

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Jerry Bowyer: A Necessary Fix On Tax Reform

Shooting Florida

The Senate version of tax reform has a hidden problem which needs to be addressed. It would greatly increase the tax burden on companies which are in debt. When a company expands operations, by say, building a factory, they usually borrow money to do it.

The tax code has always allowed business to take the cost of that borrowing into account when they calculate their profit for the sensible reason that it is a cost of doing business. Tax reform is cutting that back, and the Senate version is cutting it back severely, especially for companies that own a lot of heavy equipment such as miners and manufacturers, exactly the type of companies that we’re trying to revive as part of the Trump growth agenda.

If we get this wrong, during the next downturn, we may well see an epidemic of high growth and heavy equipment companies driven into bankruptcy by their inability to pay their old debt and their new taxes on it at the same time.

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