Wednesday, December 27, 2000
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Wednesday, December 27, 2000 |
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Collins: Get cracking on economic problems now Fayette's representative in the U.S. Congress is wasting no time in pressing ideas on the new Bush Administration. Prudent changes in tax and interest policies and development of a coherent energy strategy will help the United States cope with a changing economy, says Rep. Mac Collins. "As evidence mounts that our economy is slowing down, we must act now, rather than later," said the Hampton Republican. "We cannot micro-manage the economy, but we can lay out a proactive agenda to strengthen it." Collins, who represents Fayette and nine other counties, laid out a three-point agenda to address factors currently acting as a brake on the economy. He recommended an interest rate cut to stimulate economic activity; several changes in tax policies, and finally establishment of a strong national energy policy. "The fastest way to strangle an economy is high interest rates," Collins said. "Rates have been increased for some time because of a fear of inflation. That was prudent, but today I believe we should be more concerned about an economic slowdown than a resurgence in inflation." Collins, a member of the House Ways and Means Committee responsible for tax legislation, said tax reforms can be used to encourage economic growth. He said capital gains taxes should be cut to encourage investment in businesses, which generate jobs and prosperity. "The connection between reductions in capital gains rates and a strengthened economy was established back in 1960, when Democratic President John F. Kennedy signed tax reductions into law. That launched an economic boom," Collins said. "In the '80s, President Ronald Reagan saw the wisdom of that policy and reduced the capital gains rates, which set off another boom which lasted through the Clinton years," Collins added. "Again, in the previous Congress, the current majority slashed the rates and the result was a very positive impact on the economy," he said. "A reduction and consolidation of marginal tax rates will also help Americans," Collins said. "One way would be to take the 39.6 percent marginal tax bracket created by President Clinton in 1993 and reduce and consolidate it with the 36 percent rate. It would be useful to examine reducing or consolidating other marginal tax rates as well. Congress also should look at the alternative minimum tax, Collins added. "This tax is punitive because it prevents families and individuals from taking advantage of tax relief provisions already written into law. Repealing the AMT would ensure working Americans can benefit from the tax relief they deserve. This will go a long way toward providing working families more savings and more earning power. "Finally," Collins said, "consumers have been buffeted by erratic energy prices because the Clinton-Gore Administration never developed an energy policy." He blamed government policies for high gas prices this past summer. "Heating oil prices hit high levels, and are rising again this winter. The Congress and the new administration must develop a coherent policy which will cushion the impact on the U.S. economy of world energy market instability," he said. "The world energy markets are complicated, and must be taken into consideration as we develop our strategy," Collins said. "We must also take into account the impact of electricity and gas deregulation, as well as our environmental regulations." Collins called for efforts to determine how the nation can increase domestic energy production in an environmentally responsible way, and still encourage conservation and the development of new technologies and sources of supplies. "Energy policy is too important for ad hoc policy," Collins said. "This three-point tax, energy and interest rate agenda can help us get a head start on problems which are facing us."
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