Letters

January 17, 2003

An Open Letter to Congress

The continued sluggishness in the American economy demands action. When the 108^th Congress convenes, we, the undersigned economists, urge you to enact a bold tax and budget agenda that includes the following components:

• Restrain federal spending. Excessive federal spending has a dampening effect on the American economy. Although the post-September 11^th world may require some new expenditures to combat terrorism, many of the federal spending increases of the past fifteen months have had nothing to do with terrorism. We urge you to reduce spending, end programs that have outlived their usefulness, and roll back government’s share of Gross Domestic Product. This is the right way to stop federal budget deficits and restore budget balance.
• Make the 2001 tax cut permanent. Uncertainty makes financial markets wobbly. Investors and individual taxpayers will be able to make better decisions on their finances if they have greater confidence about what tax laws they will be facing in coming years. It is imperative for Congress to make the entire 2001 tax cut permanent.
• Enact further pro-growth tax relief. Even if the 2001 tax cut is made permanent, Americans will still pay more in taxes than they do for food, clothing, shelter, and transportation combined. Congress must take the lead in further reducing the tax burden. We particularly encourage you to enact changes to those tax provisions that are especially harmful to economic growth. One such idea is to eliminate the current double-taxation on corporate dividends. Reforming or ending the individual and corporate Alternative Minimum Tax would be another positive step.

As a rule, government cannot create wealth or expand the economy. Only the private sector can do that. Government can, however, hinder economic growth through excessive taxes, high marginal tax rates, over-regulation, or unnecessary spending. Accordingly, elected leaders should be working to adopt measures that curb or halt government policies that are hurting the economy. The three action items above will help achieve this objective.

Sincerely,

Burton A. Abrams, University of Delaware

William R. Allen, University of California, Los Angeles

Ryan C. Amacher, University of Texas, Arlington

King Banaian, St. Cloud State University

Doug Bandow, Cato Institute

Bruce Bender, University of Wisconsin, Milwaukee

John Berthoud, National Taxpayers Union/George Washington University

Scott Bradford, Brigham Young University

L. Jackson Brown, American Dental Association

Phillip J. Bryson, Marriott School of Management, Brigham Young University

James Buchanan, Nobel Laureate in Economic Sciences - 1986

M. Northrup Buechner, St. John’s University

Richard C.K. Burdekin, Claremont McKenna College

James L. Butkiewicz, University of Delaware

Henry N. Butler, Chapman University

Lawrence R. Cima, John Carroll University

Kenneth W. Clarkson, University of Miami

Darin Clay, Marshall School of Business, University of Southern California

John P. Cochran, Metropolitan State College of Denver

Roy E. Cordato, John Locke Foundation

Jim F. Couch, University of North Alabama

Eleanor D. Craig, University of Delaware

Coldwell Danniel, III, University of Memphis

Ronnie H. Davis, Printing Industries of America

A. Edward Day, University of Central Florida

Gregory J. Delemeester, Marietta College

Jeffrey H. Dorfman, University of Georgia

Stephen J. Entin, Institute for Research on the Economics of Taxation

Edward W. Erickson, North Carolina State University

Michael G. Erickson, Albertson College

Paul Evans, Ohio State University

Frank Falero, California State University

Susan K. Feigenbaum, University of Missouri, St. Louis

Fred Foldvary, Santa Clara University

William Ford, Federal Reserve Bank of Atlanta

D. C. Fretchling, George Washington University

Milton Friedman, Nobel Laureate in Economic Sciences - 1976

S. D. Garthoff, Ohioans for a Strong Economy

James F. Gatti, School of Business, University of Vermont

Gerald T. Garvey, Claremont Graduate University

David E. R. Gay, University of Arkansas

Charles Goetz, School of Law, University of Virginia

Stephan F. Gohmann, University of Louisville

Richard L. Gordon, The Pennsylvania State University

Scott F. Grannis, Western Asset Management

David L. Hammes, University of Hawaii, Hilo

Cary Heath, University of Louisiana, Lafayette

Dale Heien, University of California, Davis

David R. Henderson, Hoover Institute

Mark Hirschey, University of Kansas

Brad Hobbs, Florida Gulf Coast University

Randall G. Holcombe, Florida State University

Daniel Houser, George Mason University

Guido Hülsmann, Ludwig von Mises Institute

Laurence R. Iannaccone, George Mason University

Steve Jackstadt, University of Alaska, Anchorage

Joseph M. Jadlow, Oklahoma State University

Dennis Jansen, University of North Texas

Michael C. Jensen, Harvard Business School

Clifton T. Jones, Stephen F. Austin State University

E. Han Kim, University of Michigan

Roger C. Kormendi, Kormendi/Gardner Partners

Robert Krol, California State University, Northridge

Richard La Near, Missouri State Southern College

Jody W. Lipford, Presbyterian College

Edward J. Lopez, University of North Texas

Donald L. Luskin, Trend Macrolytics, LLC

Doug MacKenzie, George Mason University

David Malpass, Bear, Stearns & Company

Michael L. Marlow, California Polytechnic State University

Fred S. McChesney, Northwestern University

Stephen T. Mennemeyer, University of Alabama, Birmingham

Lloyd J. Mercer, University of California, Santa Barbara

John Merrifield

Tracy Miller, Grove City College

James C. Miller, III, Former Director (1985-1988) Office of Management & Budget

Jeffrey Milyo, Harris Graduate School of Public Policy, University of Chicago

Jeffrey Miron, Boston University

John C. Moorhouse, Wake Forest University

Andrew Morriss, Case Western Reserve University

Anthony Negbenebor, Gardner-Webb University

William H. Oakland, Tulane University

Lee E. Ohanian, University of Southern California

Lydia Ortega, San Jose State University

E. C. Pasour, Jr., North Carolina State University

Charles R. Plott, California Institute of Technology

Barry W. Poulson, University of Colorado

Aris Protopapadakis, Marshall School of Business, University of Southern California

Jan Prybyla, The Pennsylvania State University

Christine P. Ries, Georgia Institute of Technology

Timothy Roth, University of Texas, El Paso

Charles K. Rowley, George Mason University

Tom Rustici, George Mason University

John Ryding, Bear, Stearns & Company

Thomas R. Saving, Texas A&M University

D. Eric Schansberg, Indiana University Southeast

Michael A. Schuyler, Institute for Research on the Economics of Taxation

Gerald W. Scully, University of Texas, Dallas

Larry J. Sechrest, Sul Ross State University

Howard Segermark, Segermark Associates, Inc.

Carlos Seiglie, Rutgers University

Barry J. Seldon, University of Texas, Dallas

John Semmens, Phoenix College

Alan Shapiro, Marshall School of Business, University of Southern California

Stephen Shmanske, California State University, Hayward

William F. Shughart, II, University of Mississippi

Tyler Shumway, University of Michigan

James F. Smith, University of North Carolina, Chapel Hill

Vernon Smith, Nobel Laureate in Economic Sciences - 2002

John C. Soper, John Carroll University

Stan Spurlock, Mississippi State University

Craig A. Stephenson, Babson College

Clifford F. Thies, Shenandoah University

Robert D. Tollison, University of Mississippi

Leo Troy, Rutgers University

T. Norman Van Cott, Ball State University

Richard Vedder, Ohio University

Robert Vigil, Analysis Group/Economics

Richard E. Wagner, George Mason University

John T. Wenders, University of Idaho

John Wicks, University of Montana

Wayne Winegarden, Economic Solutions, LLC

Mike Wohlgenant, North Carolina State University

Gary Wolfram, Hillsdale College

Gene C. Wunder, Washburn University

Mokhlis Zaki, Northern Michigan University

Asghar Zardkoohi, Texas A&M University

Paul Zak, Claremont Graduate University

Kate Zhou, University of Hawaii

Benjamin Zycher, Pacific Research Institute

(Note: Affiliations are listed for identification purposes only)

[signatories updated March 2, 2003]

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