Don't Spread Wealth. Create Wealth

Strong economic growth solves a lot of problems.


My friend and superblogger Ross Douthat has been posting about the political appeal of Obama's "spread the wealth" philosophy. My two cents: I am a big believer in creating wealth, as are my fellow Americans. Consider this: During the 1980s, the economy notched 19 quarters of 3.5 percent GDP growth or better. In the 1990s, the economy also notched 19 quarters of 3.5 percent growth or better. So far this decade? Just eight. Or look at the number of quarters of "hypergrowth"—5 percent or better. (This was JFK's GDP goal in the 1960s, by the way.) There were 12 in the '80s, eight in the '90s. So far this decade? Just a single quarter, the third quarter of 2003.

When people think true prosperity is unattainable, then they will settle for mere alleviation of their misery. As JFK said in 1961: "The potential of the American economy is constantly expanding. The labor force is rising by 1.5 percent per year. Output per man rises annually by 2 percent as a result of new and better plants and equipment, modern technology, and improved human skills. These increases in manpower and productivity provide the base for a potential annual growth of 3.5 percent in the nation's total output. This is not high enough. Our potential growth rate can and should be increased." I agree!