A Rapidly Changing Landscape

In my last blog I highlighted an important statement made by Scott Brown, an obscure politician from Massachusetts, recently catapulted into the national spotlight, being elected in a remarkable victory for US Senator from the Commonwealth.

To reiterate, he said in his acceptance speech:

I will work in the Senate to put government back on the side of people who create jobs, and the millions of people who need jobs - and starts with an across the board tax cut for individuals and businesses that will create jobs and stimulate the economy. It's that simple!

There were early hints of this voter sentiment: tea party patriot rallies last summer and gubernatorial elections in Virginia and New Jersey last fall. The former were ridiculed by some, demonized by others, and the new governors were thought to be elected on account of local issues.

It took one person, Scott Brown, to crystallize and clarify the national concern of voters, a significant message from people not affiliated with either major political party. Their messages:

• Stop health care in the questionable form pushed by Washington, this the greatest concern found in voter exit polling.

• Don't Mirandize terrorists. After the election the nation was to learn that intelligence and homeland security leaders testified to Congress that they weren't even consulted about this protection given to the underwear bomber, 50 minutes after officials confronted him.

• Cut out the secret backroom deals with special interests. There was the Louisiana Purchase, followed by the Cornhusker Kickback assented to by a senator from my home state. The creme de la creme shocked people recently when select unions were granted a 5-year tax exemption on their Cadillac health insurance plans.

These are issues that I do not analyze on these pages. But I do explore macroeconomic matters, to which we now turn to the fourth voter message from Massachusetts:

• Don't raise taxes, cut them.

I have been holding onto a hallmark economic investigative report, produced last fall by Silvia Ardagna and Alberto Alesina, professors of Economics at Harvard University, and also members of the National Bureau of Economic Research (NBER), the group who makes the call of whether the US in in a recession, or not.















Their study examines how effective government, ie, fiscal, stimuli have been in alleviating economic difficulties. This far reaching study spans four decades, from 1970 to 2007, and examines remedies and results for twenty-one countries in a panel of OECD (Organisation for Economic Co-operation and Development) countries, such as Australia, Canada, France, Germany, Japan, United Kingdom and the United States.

We will examine this in my next blog article.