Former Economic Adviser to two Democratic administrations, Charles L. Schultze was a prominent figure in the Johnson and Carter Administrations – in this episode of CBS Radio’s Face The Nation, Schultze is asked what he thought about the Reagan Administration tax cuts recently proposed.
Schultze, no stranger to Tax cuts and in fact was instrumental in proposing Tax cuts as a method of funding the War In Vietnam under the Johnson administration. To a degree he was an advocate of Supply Side Economics. According to conventional wisdom, government may intervene when private markets fail to provide goods and services that society values. This view has led to the passage of much legislation and the creation of a host of agencies that have attempted, by exquisitely detailed regulations, to compel legislatively defined behavior in a broad range of activities affecting society as a whole–health care, housing, pollution abatement, transportation, to name only a few. Far from achieving the goals of the legislators and regulators, these efforts have been largely ineffective; worse, they have spawned endless litigation and countless administrative proceedings as the individuals and firms on who the regulations fall seek to avoid, or at least soften, their impact. The result has been long delays in determining whether government programs work at all, thwarting of agreed-upon societal aims, and deep skepticism about the power of government to make any difference. Strangely enough in a nation that since its inception has valued both the means and the ends of the private market system, the United States has rarely tried to harness private interests to public goals. Whenever private markets fail to produce some desired good or service (or fail to deter undesirable activity), the remedies proposed have hardly ever involved creating a system of incentives similar to those of the market place so as to make private choice consonant with public virtue.
Where a policy of “less is more”, Schultze is asked about the latest round of Tax Cuts as proposed by the Reagan Administration. It would come as no surprise that the tax cuts Reagan was proposing were considered overboard and somewhat defying in logic. But it wouldn’t be the first time, nor would it be the last during the Reagan era.
Here is Face The Nation featuring Charles L. Schultze on August 30, 1981
