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Show f j Your Man I I'-C In Washington L ...1 L U.S. Senator Orrin G. Hatch THE TAX CUT YOUDIDX'T GET In 1963 President John F. Kennedy and the United States Congress presented the people an across-the-board permanent perma-nent tax cutting program. The Pr-sident obtained support from the Congress on the promise that. "Our tax system siphons out of the private economy too large a share of personal and business purchasing power and reduces the incentive for risk, investment, and effort ef-fort thereby aborting our recoveries (from recessions) reces-sions) and stifling oui national na-tional growth. " There is reason to believe the disincentives referred to by President Kennedy exist in the American economy today. There is equal reason to believe that a similar type of permanent tax cut is the answer. See if today's economy has any similarities to the 1963 economy as described by President Kennedy: "The chief problem confronting our economy is its unrealized potential, slotc groiclh. underinvestment, underinvest-ment, unused capacity and persistent unemployment. The result is lagging wage, salary and profit income, smaller take-home pay, insufficient in-sufficient productivity gains, inadequate Federal revenues, and persistent budget deficits. One recession reces-sion has followed another, with each period of recovery' and expansion failing out earlier than th last. " A permanent tax cut would stimulate economic growth through increased production -- real production produc-tion to create the jobs n c i' (I i' (I to r c d II c e unemployment, to raiso the omtuII standard of living, liv-ing, to enlarge the tax base enough to eliminate the deficits in the Federal budget and to fight inflation. infla-tion. A permanent tax cut stimulates economic growth and production by lr iiliiiu capital for investment, in-vestment, either diri'dlv or through savings institutions. institu-tions. Must citi.ens rcl on the larger, insured, more experienced investors at savings institutions to earn their investment dollars. If more economic growth is the desire there must be more investment and that requires lower tax rates. The United States has had the lowest savings rate in the Western world in the postwar period. In 1950 the U.S. had twice the per capita income of Sweden and Switzerland. By 1974 these countries had surpassed the United States along with Belgium and Denmark. Now West Germany, Canada, France, and Japan are knocking at the door. This spectacular growth stems from their deliberate attempts at-tempts to increase their rates of saving and investment. invest-ment. When compared with these nations the U.S. comes in dead last in investment in-vestment share of the gross national product. How ironic it is that the free enterprise system perfected, then ignored by this nation, is the system other Free World Countries Coun-tries are now using to get ahead. Remember the good old days when thrift used to be virtue? In 1960 a savings account drawing a 4 interest rate earned approximately 2 in real dollars after a 2 loss to taxes and inflation. That doesn't sound like much. But today a savings account ac-count earning 7 interest, loses 3 in taxes, and 5 to inflation, leaving a net loss of 1 of every dollar set aside for savings. This is how the Federal Government rewards those who attempt to save today. In the first round of tax debates just completed, com-pleted, both the House and Senate rejected a permanent per-manent lax cut, hut the fight isn't over yet. There is a good chance that in the late rounds of the 9ftfi Congress opxnent.s mav see the wisdom of a permanent perma-nent tax cut . . . hopefully before tile final bell is sounded. |