How to Cure America's Capital Anemia

Publication Date: August 1983

Publisher: Heritage Foundation (Washington, D.C.)

Author(s): Thomas M. Humbert

Research Area: Banking and finance; Economics

Keywords: Economy

Type: Report

Coverage: Japan

Abstract:

The U.S. should emulate Japan, not by imitating an irrelevant industrial policy, but by copying its tax treatment of capital and investment. Like Japan, the U.S. should reduce taxes on capital gains, corporate income, dividends, and savings. Like Japan, the U.S. should free up the market so that it can raise and allocate capital efficiently. The ultimate goal should be replacement of the current U . S . tax system with a consumption tax. Such reforms would increase the capital available to.the American economy, thus triggering vigorous and sustained economic growth and millions of new jobs.