Free Trade

-By Warner Todd Huston

First the greenies came to take away our lightbulbs in the U.S. and force us to buy more expensive ones. Now the greenies are on the march in Australia with the unkindest swipe of all: forcing Australians to pay 42 percent more for toilet paper.

In a report recently put out by Tim Wilson of SustainableDev.org (.pdf of report), we find greenism being used as a cover to foster protectionist trade restrictions in Australia. Wilson reveals that toilet tissue companies in Australia are using fake green concerns to keep competing foreign toilet paper products from reaching the country. These restrictive polices will cause the cost of toilet paper in Australia to climb as competition is eliminated.

Further he cites the use of fake green policies serving as cover for restrictionist policies in other countries, too. Not just by governments, but corporations and even unions are using fake green issues to serve their desires to dampen free trade internationally.

Of these policies Wilson writes, "increasingly industry and unions are now doing the same. Cloaked behind environmental language industry and trade unions appear to now be colluding with the messages of green groups to advocate for green protectionism."

But what is the cost of all these protectionists and restrictive green policies? For one thing they retard the progress in the poorest nations on earth as free trade is quashed. These green policies aid in holding back any hope that struggling third world countries will ever be able to grow and improve.

And it's not just Australia finding this to be true. Every western nation is leaning this way as green policies undermine free trade. The fact is green policies contributes to making lives miserable for the world's most vulnerable peoples. Sadly, greenism is an anti-human religion, one that too many people have sold their souls to believe in.

Since none of our so-called leaders are going to present an alternative economic recovery package, I'll do it myself.  Items are in no particular order except the order in which they came to me.

1) Slash the Corporate Income Tax Rate to 15% - The United States currently has the Second Highest Corporate Tax Rate in the World.  This puts our companies at a gigantic competitive disadvantage internationally and retards both job growth and the stock market here at home.  Cutting corporate taxes will spur a business led investment boom in the United States.

2) Make Bush Reductions in Capital Gains and Dividends Permanent - While I would love to slash these grossly counterproductive rates further, that's not feasible politically at the moment.  The next best thing would be to send a permanent signal to financial markets.

3) Abolish the Employer Half of the Payroll Tax - As liberals frequently point out, 80% of taxpayers pay more in payroll taxes than income taxes.  They deserve a big tax cut.  This will also act as a major job creation mechanism.

4) Pass Colombia, South Korea, and Panama Free Trade Agreements - This move is more symbolic than substative, however, it is crucially important.  Passing these agreements would signal to our trading partners that the United States will not turn protectionist like we did in the 1930's.

Passing the Colombia agreement would also weaken an increasingly despotic Hugo Chavez.

5) Establish a 15% flat rate on All Income - This will leave Americans with more money to spend, invest, or do whatever the heck they want to do with it.  It will also do away with the deadweight loss from tax code complexity.  Many other Countries have done this successfully.

Should this prove politically unfeasable, we should still strive to do this for everyone except the top income tax bracket.

6) Create A National Market for Medical Insurance - Rising Medical Costs have been a major economic drag for the past decade.  While the reasons for this are worthy of their own blog post, creating a national market for Medical Insurance instead of 50 separate state markets is the easiest way to lower costs.

7) Drill, Baby, Drill - In addition to harming those nice guys in Tehran, Moscow, and Caracas, increased energy production at home will create oodles of jobs.  It might even make the auto bailout a moot point.

8) Immeadiate Expensing for Business Investment - This will also create a boom in business investment.

9) Boost Defense Spending - This is a policy I support for other reasons.  That said, defense spending has a higher Keynesian Multiplier than anything President Elect Obama is proposing.

10) Abolish the Alternative Maximum Tax - This wildly unfair tax should just be abolished.  I don't care about the rationale.

11) Abolish Sarbanes/Oxley - This onerous regulation, passed during the Enron panic, drives capital and businesses overseas without preventing fraud at home.  Repeal of SarBox would ignite a stock market boom!

12) Abolish Mark to Market - This obscure accounting rule forces companies unnecessarily to lower the value of their assets relative to what they could be sold for.  This was a major factor in the credit freeze.

13) Abolish the Death Tax - Any change in tax policy that both antagonizes liberals and hurts Warren Buffet must be a good idea.