If the American economy is to recover, taxes at all levels must be lowered, economist Arthur Laffer told a Toledo audience yesterday.
Mr. Laffer, best known for the Laffer Curve and for advocating so-called supply-side economics during the Reagan administrations, spoke at the Toledo Club to more than 100 clients of Huntington Funds, a subsidiary of Huntington National Bank.
His Laffer Investments Inc. is an adviser to Huntington Macro 100 Funds.
Mr. Laffer said that Ohio's poor economy is a microcosm of the nation's.
"Ohio is not in very good shape. Taxes have gotten totally out of control," he said.
He said the North American Free Trade Agreement has been a boon to Ohio. "But," he said, "we commit suicide [by increasing taxes] then blame it on NAFTA."
Mr. Laffer also criticized the recent federal stimulus checks, saying "they absolutely hurt the economy."
http://toledoblade.com/apps/pbcs.dll/article?AID=/20080617/BUSINESS06/80...
... the level of taxation when 40% of a working man's pay is swallowed up by taxes and fees each year from all sources, but it wasn't taxes that built the Maquiladoras, Mr. Laffer. It was the astounding difference in wages between Mexicans and USians.
Factories are packing up and heading out of the USA due to the entire cost profile, Mr Laffer. Taxes are only a part. Wages are a BIG part. Regulation compliance costs are also a part.
In my opinion, the more US industry flees Ohio, the more Ohio's corrupt and spendaholic local governments are going to tax that which remain. And "that which remain" are purely the people and small businesses. We're going to get a harsh lesson in true representative democracy here in Ohio, as our politicians try to hurt us no matter which party is given control. Since Ohioans won't actually tax themselves into the poorhouse, eventually there will be a significant blowback against electing one tax-and-spend and one borrow-and-spend politician after another. Unfortunately, we're just not there yet.