"Cheap Just Does Not Do It"

In Arizona, we've had more than a decade and a half (since 1991) of working under the assumption that if we just made things less costly for business and the better-off -- cutting taxes, reducing regulation, you know the drill -- we'd do well. And what has the result been of all that tax cutting and regulation reducing? According to state Rep. Rick Murphy (R-Glendale), "We have one of the worst business tax climates in the world in Arizona and that has to change." Of course, Rep. Murphy wants to do more of what we've been doing over the past 15 years. Yes, we're in a hole, and according to the Republicans, we must keep digging.

Outside observers are less wedded to their ideology. As the Financial Times reported today, home prices in large US cities dropped at a record rate in 2008, with Phoenix, Las Vegas and Minneapolis dropping the most, and Boston, Denver, and New York showing relatively small declines.

Key quote showing the bankruptcy of the GOP's "less tax = more growth!!!!!" philosophy:

“The mix of a sharply deteriorating labor market, associated weakness in personal income, broader negative wealth effects from other asset classes, a massive overhang of actual and potential supply, and troubled credit availability [is] swamping the record affordability measures,” said Alan Ruskin, strategist at RBS Greenwich Capital. “Cheap just does not do it.”