Bailing Out Failed Savings and Loans
The recently suggested tax on savings is only a timid first step towards resolving many of our nation’s current financial problems. With a little thought, it is obvious that the tax on savings should be placed at 100%.
Consider: If there were no savings, there would be no S&Ls;, and consequently there would be no crisis. Correspondingly, taxing pension funds out of existence would eliminate the largest source of funds for junk-bond takeovers and the staggering corporate debt that they create.
The tremendous expansion of the Japanese economy has been fueled by the high savings rate of the Japanese people. Economics in the U.S. in the 1980s, though, doesn’t work that way--savings create debt. So tax savings out of existence to make industry and our financial institutions solvent.
LEWIS H. COHEN
Riverside
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