Karl W. Smith, Columnist

Start Building the Post-Pandemic Economy Now

Congress needs to consider changes to tax law that spur long-term economic growth.

July 16, 2020 at 2:45 PM UTC

Karl W. Smith is a Bloomberg Opinion columnist. Previously, he was vice president for federal policy at the Tax Foundation and assistant professor of economics at the University of North Carolina.

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With crucial economic support running out at the end of the month and Covid-19 cases rising in nearly every state, Congress has no choice but to revisit measures designed to provide immediate relief to businesses and households. At the same time, it has to address the long-term need for a robust and sustainable economic recovery.

The best and most cost-effective way to accomplish that — far better than a capital-gains tax cut or a payroll-tax holiday, to name two frequently floated ideas — is to pass a law allowing for full-cost recovery for private investment. It might sound arcane, but the effects are profound.