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From: bright@Data-IO.COM (Walter Bright)
Newsgroups: comp.sys.amiga,comp.sys.atari.st,comp.sys.ibm.pc,comp.sys.mac,sci.electronics,comp.arch
Subject: Protectionism
Message-ID: <1519@dataio.Data-IO.COM>
Date: 1 Apr 88 22:15:31 GMT
References: <2441@unicus.UUCP> <1259@hubcap.UUCP> <1641@ncsuvx.ncsu.edu>
Reply-To: bright@dataio.UUCP (Walter Bright)
Organization: Data I/O Corporation; Redmond, WA
Lines: 17

Most economists today agree that one of the major causes of the Great
Depression in the 30's was when Congress passed major protectionist
legislation. Remember history when you propose new protectionist policies.

The causes of the Depression were:
1. Comprehensive new protectionist laws.
2. Large tax increases.
3. The Federal Reserve System failed to allow interest rates to rise, and
   failed to make more money available to banks (which directly resulted
   in bank failures).
4. The stock market crash was not in itself responsible (just look at last
   October's crash, where's the new Great Depression?).

If Americans want American business to spend more money on R+D to make them
more competitive, they shouldn't tax R+D so heavily. The investment tax
credit should be restored, along with favorable treatment for long-term
capital gains. The US taxes R+D far more than Japan does. Protectionism
is like painting over rust.