Thank You, Tax Reform
The American economy is a tremendous engine of prosperity when politicians get out of the way, and for proof look no further than Thursday’s report on fourth-quarter growth. It’s clearer than ever that business investment has rescued the U.S. economy by shifting into a higher gear. Tax reform and deregulation, take a bow.
Tax reform arrived in 2018, removing the roadblock of the highest corporate tax rate in the world and inviting companies to repatriate profits held abroad. Investment picked up almost exactly as chief White House economist Kevin Hassett predicted it would. He predicted growth for the year would rise by 3.1% in 2018 on a fourth-quarter to fourth-quarter basis, and growth came in exactly at 3.1%.
Mr. Hassett made these predictions in the heat of the 2017 tax reform debate and was ridiculed by progressive economists. One quote that doesn’t age well came from Larry Summers, the former Barack Obama adviser, who wrote in the Washington Post that tax reform would make no difference unless “you believe in tooth fairies and ludicrous supply-side economics.”
https://www.wsj.com/articles/thank-you-tax-reform-11551399901