Michigan miracle: Proof tax cuts work

Last week was tax week in America. This period includes that infamous date of April 15, when the IRS intrudes on our lives and tries to convince us (at gunpoint and threat of prison) that our money and property actually belongs to them.

Over the years I've come to realize that the Mafia offers a far better deal than the IRS. Let's look at the facts.

The mob comes to a businessman (like me) and demands 10 percent for "protection." The rub, of course, is that the protection is from them. The government calls that extortion and will send a mobster to prison for 20 long years on that charge. Yet the same government comes to that same businessman, demands a 50 percent (or more) cut of his business, and offers no protection whatsoever.

I prefer the deal offered by the Mafia.

Government also cooks the books and distorts the facts when it comes to taxes. President Obama tells us that tax increases will not hurt the economy. He calls tax cuts "handouts" to the wealthy. He says that tax cuts create deficits. But whenever Obama wants to spur the economy, he is quick to offer tax cuts to his voters. When Obama wanted to sell cars, he offered a subsidy called "Cash for Clunkers." When Obama wanted to sell homes he offered a tax rebate to home buyers. When Obama wanted to sell appliances, he offered a rebate to consumers. When Obama wanted to encourage spending, he offered an almost trillion-dollar stimulus in the form of "tax cuts" to people who never paid taxes in the first place.

Weren't all those programs "handouts"? Didn't those tax cuts increase the deficit? 

But the most telling story of all about taxes is found in Michigan. Michigan is a big-government, big-spending state that suffers from the worst economy in America. It has 14 percent unemployment, "empty cities" such as Detroit (which has lost half of its population), and leads the nation in moving vans heading out. Yet one thing is working fantastically in Michigan: tax cuts.

In the midst of economic Armageddon in Michigan there is one part of the economy that is booming: movie production. Why? Because Michigan offers the most generous tax incentives in the nation for movie-makers. The result? The liberal progressive hypocrites of the movie business -- the same ones who support Obama, the same ones who call tax cuts for the rich "greedy" -- have moved Hollywood to Michigan. Last year, 87 films were made in Michigan -- a 900 percent increase from the year before. Three major movie studios are opening this year in Michigan. Yes, the tax rebates cost Michigan $40 million, but those same tax rebates produced 7,000 new jobs and $325 million in new revenues for the Michigan economy.

Now that's a great economic success story.

Michigan is Exhibit A for proving that allowing taxpayers to keep more of their own money works like magic. Even amidst the worst economy in America, a tax incentive has persuaded Hollywood hypocrites to relocate from sunny Southern California to depressing and freezing Michigan. Can you imagine what a dramatic tax cut would do for the entire American economy?

Let's institute a one-year "income tax vacation" for the taxpayers of America. This would benefit in particular small business owners -- who pay most of the taxes and create 75 percent (or more) of new jobs. If you let them keep 100 percent of their own money for one year, they will create the greatest economic turnaround in world history. They will invest it in stocks (driving up the stock market), bonds (driving down interest rates), real estate (ending the foreclosure crisis) and starting new businesses and expanding old ones (creating millions of new jobs and producing millions in new tax revenue). They will invest in and revitalize America.

Barack Obama, Harry Reid and Nancy Pelosi (the Axis of Taxes) would say, "But where would we find the money?" Well, Obama found the money for $1 trillion in stimulus spending. He found $1 trillion for universal health care, $13 trillion for bailouts and billions more for earmarks and legal bribery (to gain the votes to pass all this obscene spending). Ronald Reagan's tax cuts proved that if you motivate small business with a dramatic tax cut, you can turn a deep recession into an economic boom almost overnight. This isn't a recession, it's a depression. It calls for special measures. 

Perhaps Obama knows exactly what he's doing. Perhaps Obama's goal is to punish, demonize and demoralize the successful, redistribute the wealth, forever cripple the people who contribute to limited government causes and bankrupt the capitalist system, so that Americans grow desperate and dependent on government.

There is one problem with this scheme, Mr. Obama: Who will be left to pay all the bills?

Wayne Allyn Root, the 2008 vice presidential candidate on the Libertarian ticket, is a Fox News regular guest and the author of "The Conscience of a Libertarian: Empowering the Citizen Revolution with God, Guns, Gambling & Tax Cuts." He writes from Henderson. E-mail him at Wayne@ RootforAmerica.com.