From Stephen Moore in the Claremont Review of Books:
The bailouts did not create the financial meltdown, but it is a good bet that they have contributed to the depths of our current problems and the stock market sell-off. We have robbed healthy companies of funds to pour money down the rat hole of failing industries like General Motors. For the cost of all federal bailouts, we could have suspended the corporate income tax for a year, which would have been a powerful stimulant to growth.
The election of Barack Obama and the fear of his across-the-board tax rate hikes on capital gains, dividends, and small businesses have created the most bearish policy environment on Wall Street since the late 1970s. Investors are forward-looking and they are seeing a tsunami of anti-growth policies. The proper response is to sell while you still can — and that is what investors have been doing en masse.
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