The Perils of Redistribution

Adam Lerrick of the American Enterprise Institute writes in today’s Wall Street Journal  about the perils of Barack Obama’s tax plan.  The most troubling part of Lerrick’s commentary is the ability, or inability, of the American economy to recover from Obama’s plan to redistribute wealth.  He writes:

The economic tides will not stand still while Washington experiments with European-type social democracy, even though the dollar’s role as the global reserve currency will buy some time. Our trademark competitive advantage will be lost, and once lost, it will be hard to regain. There are too many emerging economies focused on prosperity and not redistribution for the U.S. to easily recapture its role of global economic leader.

He also offers us a bit of history:

The sequence is always the same. High-tax, big-spending policies force the economy to lose momentum. Then growth in government spending outstrips revenues. Fiscal and trade deficits soar. Public debt, excessive taxation and unemployment follow. The central bank tries to solve the problem by printing money. International competitiveness is lost and the currency depreciates. The system stagnates. And then a frightened electorate returns conservatives to power.

Obama’s tax plan could severely compromise America’s standing in the global marketplace.  The question is, will we be able to recover?