Dem-Run Congress Could 'Help Destroy Economy,' Analyst Says

By Randy Hall
CNSNews.com Staff Writer/Editor
October 06, 2006

(CNSNews.com) - Democrats on the campaign trail are promising that if they win control of Congress on Nov. 7, they will "jump-start our economy" through such measures as raising the minimum wage and ending the Bush tax cuts, but a conservative analyst said that enacting those policies could instead "help to destroy our economy."

"Choices made by President Bush and Republicans in Congress have created a market failure," said House Minority Leader Nancy Pelosi during a speech in Washington, D.C., on Thursday. "They have consistently rewarded wealth without rewarding work.

"This economy is making the super-rich richer and leaving middle-class American families further behind, deeper in debt and struggling to make ends meet," the California Democrat added.

Pelosi's remarks echoed information at the House Democrats' website that promises the party will "jump-start our economy and reform our economic policy, designing it to address the needs of working families."

Charging that "8 million people are out of work, 1 million private-sector jobs have been lost since the beginning of the Bush administration, and long-term unemployment is at the highest level in 10 years," the Democrats put forward a plan to create a "New Direction" for economic growth that includes:

* An "Innovation Agenda" of policies and legislation that will create an educated, skilled workforce; invest in federal research and development; guarantee affordable access to broadband technology for all Americans; and achieve energy independence in 10 years by developing clean and sustainable energies;

* Middle-class tax cuts to put spending money in the pockets of average Americans;

* $32 billion in tax relief for small businesses to generate investment and jobs, as well as a permanent new tax break for companies to expand and create jobs in the U.S.

* Extended unemployment benefits; and

* "Pay As You Go" budgeting to ensure that new spending or tax cuts do not add to the deficit.

"We are committed to auditing the books and subjecting every facet of federal spending to tough budget discipline and accountability, forcing the Congress to choose a new direction and the right priorities for all Americans," the site adds.

Brian Darling, director of Senate relations for the conservative Heritage Foundation, told Cybercast News Service he is concerned that the Democrats' plan relies so heavily on "investments" and increased government spending, which could lead to higher taxes.

"We have a pretty low degree of taxation in our country, and it's no coincidence that our economy's good," Darling said. "In countries that have high taxation, the economies are terrible.

"If we want to regulate and force businesses to pay people more and tax the rich, that may make for good sound bytes and rhetoric, but it will help to destroy our economy if we're overtaxing individuals who are creating wealth," he noted.

"It's better that some individuals are amassing some wealth and that people can look forward to having some opportunity to amass their own wealth, rather than allow the government to amass wealth and spend it on wasteful government programs," Darling stated.

"If the minimum wage was to be hiked, and if the Bush tax cuts were repealed, and if more regulations were placed on our economy, it would turn around an economy that is doing very well," he said.

"Unemployment is under 5 percent, the Dow is soaring, gas prices are coming down, and the American people feel -- and they usually vote with their pocketbooks -- that Congress would be making a grave mistake if they took actions that hindered our economic growth," Darling noted.

Republicans also criticized Pelosi's speech and the Democrats' economic program.

"If there was any evidence that campaign season is in full swing, it's Nancy Pelosi's epiphany that tax cuts spur economic growth after years of leading the charge in tax hikes on American workers," said Tracey Schmitt, a GOP spokeswoman.

"The Democrat plan of heaping taxes on parents, families and employers has failed in the past and is an astonishingly foolish agenda for the future," Sen. Mitch McConnell (R-Ky.) noted.

Darling also offered the GOP some advice as the mid-term election draws closer.

"The one real mistake I think Republicans are making is they're not talking enough about what's going on with the economy," he said. "It's doing really well, and a lot of these politicians are missing the big picture and not talking about how many of the Bush policies are helping to promote growth."

While acknowledging that "the Republican Party's made some mistakes" while in control of Congress -- such as "spending too much money" -- Darling noted that "whatever party wants to be in power in the future needs to have a vision of low taxation and low government expenditures."

"We need to reel in some of the expansion of the federal government. We need entitlement reform," he said. "I think potential Speaker Pelosi would never talk about entitlement reform or any of the other things that really need to be done."