Interview with Thomas Sowell

Thomas Sowell is an economist and has some very direct and interesting ideas on the US economy, taxation, national debt and poverty. John Hawkins asked him ten questions - the interview is an interesting one to say the least... Here are the first five: bq. John Hawkins: Do you believe a flat tax would help produce more economic growth than the progressive tax system that we currently have? If so, can you explain why? bq. Thomas Sowell: A flat tax would not penalize additional efforts at an increasingly higher rate. This would reduce the discouragements to such efforts and to the taking of risks. bq. John Hawkins: Could you explain why rent control is a bad idea? bq. Thomas Sowell: Like all forms of price control, rent control leads to a simultaneous increase in the amount demanded and a reduction in the amount supplied. The resulting shortage then means that landlords need not spend as much money maintaining rented premises, because there are more applicants than apartments, thus leading to a faster deterioration over time. Meanwhile, fewer replacements -- sometimes none -- are built because of low or non-existent profits. This scenario has been played out in countries around the world -- in Australia, Sweden, France, England, the United States, for example. bq. John Hawkins: Do you think a Balanced Budget Amendment or some other sort of legislation that forces government to control spending will be necessary to get the budget deficit under control long-term? If so, would you recommend a Balanced Budget Amendment or something else? bq. Thomas Sowell: Balanced budget requirements seem more likely to produce accounting ingenuity than genuinely balanced budgets. The real goal should be reduced government spending, rather than balanced budgets achieved by ever rising tax rates to cover ever rising spending. For this, the only policy that seems promising is "eternal vigilance," the price we must pay for freedom in general. bq. John Hawkins: Can you explain why protectionist tariffs on let's say steel or textiles actually end up costing America more jobs than they save? bq. Thomas Sowell: The number of jobs in the steel is exceeded many times over in industries making steel products, from automobiles to oil rigs, refrigerators, locomotives, etc., etc. Tariffs that save jobs in the steel industry mean higher steel prices, which in turn means fewer sales of American steel products around the world and losses of far more jobs than are saved. bq. John Hawkins: One thing you've said that I found intriguing was that,"if you gave every poor person enough money to stop being poor, that would cost a fraction of what our welfare state programs and bureaucracies cost". Do you have any numbers on that and in your opinion, even if that's not a good idea, would it be a better idea than what we're doing currently? bq. Thomas Sowell: Professor Walter Williams of George Mason University has done the calculations of the cost of raising every poor person above the poverty level by directly giving them money and found it to be a fraction of the cost of the numerous programs ostensibly aimed at helping the poor. For more of Thomas Sowell's writings, check out here for his syndicated columns and links to his six books.