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Spoiled brats
By ERNEST F. HOLLINGS, former U. S. senator

SEPT. 8, 2010 -- Talking to an in-the-beltway friend in Washington, we both lamented that the Obama administration was so inept. My friend called "in-the-beltway" the "logic free zone." The Obamas continue to bail the sinking economy boat as fast as they can with stimulation and tax credits and are totally oblivious to the off-shoring hole in the bottom. As Paul Craig Roberts, former Assistant Secretary of the Treasury for Ronald Reagan, states: "The only way the United States will again have an economy is by bringing back the off-shored jobs."


Hollings

Off-shoring jobs commenced fifty years ago and hemorrhaged under President George W. Bush, losing almost one-third of our manufacture and manufacturing jobs. But it's so easy to fix. All we need to do is start enforcing our trade laws to rebuild the economy. First, we need to give the economy a traumatic shock to reverse its direction: stop off-shoring by removing the tax incentive to off-shore, create jobs, boost exports, and pay down the debt by replacing the corporate income tax with a 5% VAT. A 5% VAT raises $600 billion. The corporate tax of 2010 is estimated at $156.7 billion, leaving $443.3 billion to stop borrowing from China and pay down the national debt. This approach would be difficult for members of Congress to vote against.

President Obama and no member of Congress suggests replacing the corporate tax with a 5% VAT because it would cut off campaign contributions. If President Obama enforces our trade laws or Congress swaps the corporate tax for a 5% VAT, coming down on their heads in opposition will be Wall Street and Corporate America not wanting to stop predictable profits from off-shore production.

Senator Tom Harken recently emphasized: "Of any free time you have, I would say 50%, maybe even more," is spent on fund-raising. Our hope is that the voters would see through this dilemma and pressure the President and Congress to give the priority to governing rather than fund-raising. But the free press fails to alert the voters. The trade war and off-shoring our economy is "top secret" with the free press. The free press psychoanalyzes President Obama from every angle, continuing to ignore the trade war and the off-shoring of our economy.

Running up the national debt, President George W. Bush stimulated the economy $7.5 trillion. During the same period household debt increased or stimulated the economy another $7 trillion. President Obama has overspent or stimulated the economy $2.8 trillion for a total of $17.3 trillion stimulation in a little less than ten years, and we're still losing jobs. Stimulation is spent. But Nobel Prize economist, Paul Krugman, ignores the trade war and the off-shoring of our economy calling for more stimulation. Last Sunday's lead editorial, "Jobs and Politics," by The New York Times mentions tax cuts, clean energy jobs, infrastructure projects, everything but the off-shoring problem. Last Sunday's lead editorial, "Jobs and Politics," by The New York Times mentions tax cuts, clean energy jobs, infrastructure projects, everything but the off-shoring problem. Tom Friedman ignores the trade war and the off-shoring of our economy, faulting the loss of jobs to a lack of education. And last Friday morning (9/3/10), the Pulitzer Prize writer, Eugene Robinson, ignores the trade war and the off-shoring of our economy, saying the voters were acting like a "bunch of spoiled brats."

The economy can't rebound and we'll continue to act like a "bunch of spoiled brats" so long as the free press treats the trade war and off-shoring of the economy "top secret."

Senator Hollings of South Carolina served 38 years in the United States Senate, and for many years was Chairman of the Commerce, Space, Science & Transportation Committee. He is the author of the recently published book, Making Government Work (University of South Carolina Press, 2008).

© 2010, Ernest F. Hollings. All rights reserved. Contact us for republication permission.

About Fritz Hollings

Ernest F. Hollings served the public for 56 years -- 38 years in the United States Senate and as South Carolina's governor, lieutenant governor and a member of the S.C. House of Representatives.

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