Don't Mess With Taxes (I Mean Texas)

Since I began this blog, one of my mantras has been - lower corporate tax rates if you want economic growth.  By doing so, you will expand the tax base and increase revenues for government social programs etc.  To me, this simple formula is as logical as any other normal, acceptable guide for human behaviour - be honest, don't litter, get an education, be kind to people, don't steal, don't drink and drive etc., etc., etc.  But for some inexplicable reason, left-wing politicians don't get it.  They rattle on about "paying your fair share", "tax the 1% more", "redistribute the wealth".  Either I'm right or they are;  so let's look at one case study for some real-life clarification:

Texas:
The Lone Star State has the lowest corporate tax rate in America and the least burden of government regulations.  Seven of the top 15 fastest-growing cities in the U.S. are in Texas and they have no state income tax.  Compare this with their neighbour, California.  That state is rapidly becoming an economic basket case.  Several major cities have gone bankrupt or face mounting debt to cover entitlement programs and other policies they simply can't afford.  Los Angeles, once the Mecca of the American Dream - "Go West Young Man" - has the highest poverty rate among major U.S. cities.  The state's income tax rate at 13.3% is the highest in the country.  And a California State University study found that the unfathomable mountain of state regulations strangling small and large businesses cost the economy $492 billion, equivalent to the loss of  3.8 million jobs a year.  Forget about the Andreas Fault - the dead weight of government will slide California into the Pacific Ocean faster than nature ever could.

And the Federal Government too can learn a lesson from Texas.  The U.S. corporate tax rate of 35% is the highest in the developed world.  Like California, America is a regulatory nightmare.  For example, in 2013 alone, the Federal Register added 80,000 pages of NEW RULES and REGULATIONS.  It would take a legion of lawyers and accountants a lifetime just to understand how these requirements would impact business.  Forward thinking politicians like Prime Minister Shinzo Abe in Japan recognized the benefits of reform.  He recently issued an economic growth strategy (nicknamed "Abenomics")  that included a corporate tax cut to below 30%.  Meanwhile, America chugs along in the fiction that big government, high taxes and free entitlements are the road to prosperity.  Maybe they should change their name to the United States of Never Never Land.