A tax cut, health care reform and changes to monetary policy are the three key ingredients needed to move the U.S. economy forward, Steve Forbes, chairman and editor-in-chief of Forbes Media, told a standing-room-only crowd at the University of Louisville Sept. 12.
Forbes was a guest of the John H. Schnatter Center for Free Enterprise in the College of Business. His talk, “Insights from Steve Forbes,” was held in Strickler Hall’s Middleton Auditorium. It marked the first event of the center’s fall programming.
Forbes confidently predicted congressional Republicans would be able to pass a tax cut by the end of the year, saying it would be in the “interest of self-preservation.” He said the cut would pass late in the year and he expected it to be retroactive to June or July.
Referencing his two runs for the Republican presidential nomination (1996 and 2000), Forbes said he remains hopeful that his flat tax proposal can become a reality. The time and money Americans spend on taxes could be used to do better things, he said.
“Junk it,” he said of the current U.S. tax code. “Put in a single, simple rate.”
In discussing health care reform, Forbes pointed out that while some consider health care to be in a “crisis” because of high demand, high demand is usually considered an opportunity.
One problem, he said, is that health care is not run on a free market system – third parties such as health insurers and hospitals mandate prices and services. Additionally, patients don’t have real control over what they are paying for; Forbes recommended more transparency so patients can see prices up front for services. Making such changes would turn health care into something “vigorous,” he said.
The third part of his economy fix involves monetary policy. The Federal Reserve cannot manage the economy by changing interest rates, he said, comparing the current system to a clock that changes the way it tells time every day.
“Let borrowers and lenders determine the price of money,” he said.
After the talk, Forbes answered several questions from audience members. Attendees were treated to free Papa John’s pizza.
The Schnatter Center’s second public program for the fall semester will be “Bourbonomics,” a panel discussion on the economics of bourbon, scheduled for Nov. 15.
