Jack Kemp

Jack Kemp died last night, he was 73. He was a quarterback for the Buffalo Bills and he used his popularity to get elected to the US House of Representatives. At first, he was always underestimated as a “dumb jock“ but eventually got noticed when he devoted most of his prodigious energies towards reforming a “tax code that rewards consumption, leisure, debt and borrowing, and punishes savings, investment, work and production.” At that time, in the mid-70’s, I would have paid 70% of my income in taxes (versus 37% today!).

Back then, every successful businessman, doctor or lawyer had a yacht that was used primarily as a tax deduction. Supply-side economics theoretically would have worked if savings wasn’t punished and debt and borrowing weren’t rewarded (we are getting to the point today when you need to start paying the bank for your deposits). By some aberration however, most everybody started borrowing and accumulating debt. The Republican revolution mistakenly gave the go-signal for everyone who worked and felt they were working hard enough to go on a spending-spree and throw prudence to the wind and let their kids worry about who was going to pay for the bills. This was the fatal flaw. Absolutely, let the people making a lot of money pay less taxes and depend on them to make their businesses grow but never encourage everyone else to behave like Warren Buffet because the result will be a surefire recipe for what we are reaping today: a full-blown recession.

Politics is so improbable. How a football player from Occidental College (where Barack Obama spent his early college years) who devoured books by conservative authors during long trips between games would be able to leave a lasting imprint on the colossal US tax code is enough proof for all of us never to underrate the power of politics to change history.