Tuesday, April 7, 2009

Back from a trip to Ireland

You've all been waiting with great anticipation to my return to these pages, so here's the next installment. I've just returned from a week in Ireland, based near Limerick, taking car day trips each day to a different area. I was last in Ireland 15 years ago, and it was really striking how much economic progress Ireland has made in that time.

On my first trip it seemed tired, worn, and old. This time there was evidence of tremendous improvement - many new homes, old ones spruced up, and much better roads. It was really a different country from the Ireland of the early '90's.

This shouldn't be surprising, since the country adopted some classic economic tax policies in the late '80's and early '90's, principally reducing the corporate income tax dramatically to one of the lowest rates in Europe.

High corporate income tax rates are the modern equivalent of the Smoot-Hawley tariff act - a really bad economic idea with really bad real world consequences. Of course, the US has the second highest corporate tax rate in the developed world, and Obama has promised to push it higher.

Ireland has shown what can be done through REAL economic stimulation via lower tax rates, and there is extremely visible evidence of the results on the ground there.

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