Feeds:
Posts
Comments

Archive for August, 2012

I’m in Slovenia where I just finished indoctrinating educating a bunch of students on the importance of Mitchell’s Golden Rule as a means of restraining the burden of government spending.

And I emphasized that the fiscal problem in Europe is the size of government, not the fact that nations are having a hard time borrowing money. As explained in this video, spending is the disease and deficits are one of the symptoms.

This is also an issue in the United States, and Steve Moore of the Wall Street Journal is worried that the GOP ticket is debt-obsessed and doesn’t have sufficient enthusiasm for lower tax rates and tax reform.

Stylistically, Paul Ryan’s Republican convention speech last night was a grand slam. …But was it the growth message that supply-siders wanted to hear, or debt-clock obsession? There were clearly apocalyptic claims. “Before the math and the momentum overwhelm us all, we are going to solve this nation’s economic problems,” said Mr. Ryan in reference to the federal rea ink. “I’m going to level with you; we don’t have that much time.” …In fact, he talked about turning around the economy with “tax fairness.” Ugh, that’s an Obama term. …Larry Kudlow of CNBC and a former Reagan economist tells me, “Paul’s speech just didn’t have the growth, tax-cutting message. We didn’t even get the words tax reform. I don’t know what happened, but it worries me.” It’s a question of priorities. Are Mitt Romney and Paul Ryan signaling that they will put spending cuts ahead of pro-growth tax-rate cuts?

I share Steve’s concern, but with a twist.

I’m not worried that the Republicans will put spending cuts ahead of tax cuts. I’m worried that they won’t do spending cuts at all (even using the dishonest DC definition) and therefore wind up getting seduced into some sort of tax-increase deal that facilitates bigger government.

As a general rule, it is always good to do spending cuts (however defined). And it is always good to lower tax rates. And if you can do both at the same time, even better.

But since I have low expectations, I’ll be delighted if we “merely” manage to get entitlement reform during a Romney-Ryan Administration. That would mean some progress on the spending side and presumably reduce the risk of bad things (like a VAT!) on the revenue side.

Read Full Post »

If you live in America and believe in free markets and small government, it’s easy to get depressed. We suffered through eight years of wasteful spending and misguided intervention under Bush, and now we’re enduring four years of additional spending and red tape under Obama.

Moreover, it’s not clear things will get any better in the next four years, regardless of what happens on November 6.

But whenever I begin to feel sorry for myself, I remind myself of how bad things could be if I lived in the United Kingdom.

The burden of government spending in the U.K. rose from 36.5 percent of economic output in 2000 up to 48.7 percent of GDP today. This mostly happened under Labor Party rule, but the coalition of so-called Conservatives and Liberal Democrats that took power in 2010 hasn’t done much to restrain government spending.

To augment the damage, taxes also have been increasing. The feckless Gordon Brown of the Labor Party boosted the top tax rate to 50 percent (a disaster from a Laffer-Curve perspective) before getting evicted by voters.

The Tory-Lib Dem coalition is similarly bad. In recent years, the capital gains tax has been increased (see these amusing posters to understand why this was a foolish idea), along with a big hike in the value-added tax (though, to be fair, the corporate rate has been slightly reduced and part of Gordon Brown’s higher income tax rate has been repealed).

But the Tories and Lib Dems aren’t through with their assault on the economy’s productive sector.

Both Prime Minster David Cameron and one of his deputies have argued that people have a moral obligation to turn more of their income over to the government.

And now the leader of the Lib Dems, Nick Clegg, is proposing a wealth tax. He says it will be a temporary measure until the fiscal emergency ends, but I would be shocked if politicians changed its mind after getting their hands on a new source of revenue (just look, for instance, how British politicians went crazy after first imposing an airline ticket tax).

Here are some illuminating excerpts from a column in the UK-based Telegraph.

“Let them eat cake”

…from what can be gleaned, the Deputy Prime Minister seemed to be suggesting a one-off or short term tax hike rather than a permanent change in the way the wealthiest are taxed. He described it as a “time limited contribution” to the “national effort” – since it was becoming clear, he said, that the country was embarked not on a “short economic battle” but a “longer economic war”. Mr Clegg said it would be “people of considerable wealth” who would be asked to make such a contribution.

It doesn’t appear that this plan will get the necessary support from the Tories, but it’s remarkable that it has been proposed. Like the death tax, the wealth tax is a turbo-charged form of double taxation.

P.S. One of the leading Lib Dem politicians got caught dodging taxes, making him the British version of America’s tax-cheating Treasury Secretary. I generally don’t object when people try to protect their income from greedy and incompetent government, but when they also are the same people proposing higher taxes on everyone else, they deserve special scorn.

P.P.S. This post is describing the current dismal fiscal situation, but the title references “a miserable and hopeless fiscal outlook.” That’s because I see no hope of good fiscal policy in the remaining years of the current government, and I suspect the statist failures of the Tory-Lib Dem coalition government will pave the way for a new Labor Party government. Needless to say, that will be – at best – jumping from one frying pan to another. Incidentally, I’m also worried about the United States for the same reason.

Read Full Post »

I wish the Republican Platform was binding.

Too bad it’s meaningless fluff

Why? Because the GOP, for all intents and purposes, has just proposed to eliminate the Department of Education, the Department of Housing and Urban Development, the Department of Energy, the Department of Agriculture, the Department of Transportation, the Department of Health and Human Services, along with a host of other government programs, agencies, and departments.

More specifically, they endorsed the 10th Amendment to the U.S. Constitution, which means they put themselves on record in favor of getting rid of all federal spending and intervention that is inconsistent with the Founding Fathers’ vision of a limited central government.

Here’s some of the story, as reported by The Hill,

All federal spending should be reviewed to ensure powers reserved for the states are not given to the federal government, according to the GOP platform approved Tuesday. The platform language is meant to ensure all federal spending meets the requirements of the 10th amendment, which prohibits state powers from being given to the feds. “We support the review and examination of all federal agencies to eliminate wasteful spending, operational inefficiencies, or abuse of power to determine whether they are performing functions that are better performed by the States,” the platform reads. “These functions, as appropriate, should be returned to the States in accordance with the Tenth Amendment of the United States Constitution.”

For those of you who don’t have your Cato Institute pocket Constitutions handy, here’s what the 10th Amendment says.

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

In other words, the 10th Amendment is basically a back-up plan to re-emphasize that the federal government was prohibited from exercising power in any area other than what is specified in the enumerated powers section of Article I, Section VIII.

And if you look at those enumerated powers, that pretty much invalidates much of what happens in Washington.

That’s the good news. The bad news is that the Republican platform will have less impact on a potential Romney presidency than this blog.  In other words, Republicans don’t intend to live up to this promise. Heck, they don’t even know that they have such a position. That’s why I included the asterisk in the title and must draw your attention to this fine print.

*Offer not good when GOP holds power.

But I suppose it’s good that they included this language in the platform, even if it’s merely empty political rhetoric

P.S. If they did abide by the 10th Amendment, it means that Obamacare also would be repealed.

P.P.S. Yes, this implies limits on democracy. Our Founding Fathers, contrary to E.J. Dionne’s superficial analysis, were opposed to untrammeled majoritarianism and wanted to make sure 51 percent of the people couldn’t vote to rape and pillage 49 percent of the people.

Read Full Post »

I was a bit surprised couple of years ago to read that an American company re-located to Canada to benefit from better tax policy.

But I wasn’t totally shocked by the news because Canada has been lowering tax rates, reducing the burden of government spending, and taking other steps to make its economy more competitive.

But I am downright stunned to learn that America’s high corporate tax rate is such an outlier that companies are even moving to welfare states such as the United Kingdom.

Here are some excerpts from a story in the Wall Street Journal.

More big U.S. companies are reincorporating abroad despite a 2004 federal law that sought to curb the practice. One big reason: Taxes. Companies cite various reasons for moving, including expanding their operations and their geographic reach. But tax bills remain a primary concern. … Aon plc…relocated to the U.K. in April. Aon has told analysts it expects to reduce its tax rate, which averaged 28% over the past five years, by five percentage points over time, which could boost profits by about $100 million annually. Since 2009, at least 10 U.S. public companies have moved their incorporation address abroad or announced plans to do so, including six in the last year or so, according to a Wall Street Journal analysis of company filings and statements. …Eaton, a 101-year-old Cleveland-based maker of components and electrical equipment, announced in May that it would acquire Cooper Industries PLC, another electrical-equipment maker that had moved to Bermuda in 2002 and then to Ireland in 2009. It plans to maintain factories, offices and other operations in the U.S. while moving its place of incorporation—for now—to the office of an Irish law firm in downtown Dublin. …Eaton’s chief executive, Alexander Cutler, has been a vocal critic of the corporate tax code. “We have too high a domestic rate and we have a thoroughly uncompetitive international tax regime,” Mr. Cutler said on CNBC in January. …In moving from Dallas to the U.K. in 2009, Ensco followed rivals such as Transocean Ltd., Noble Corp. and Weatherford International Ltd. that had relocated outside the U.S. The company said the move would help it achieve “a tax rate comparable to that of some of Ensco’s global competitors.”

Wow. I can understand moving to Ireland, with its 12.5 percent corporate tax rate, but I wouldn’t have thought that the U.K.’s 24 percent rate was overly attractive.

But compared to the punitive 35 percent rate in the United States, I guess 24 percent doesn’t look that bad.

So what’s the solution? The obvious answer is to lower the corporate tax rate. But it also would help to eliminate worldwide taxation, as noted in the article.

Lawmakers of both parties have said the U.S. corporate tax code needs a rewrite and they are aiming to try next year. One shared source of concern is the top corporate tax rate of 35%—the highest among developed economies. By comparison, Ireland’s rate is 12.5%. …Critics of the tax code also say it puts U.S. companies at a disadvantage because it taxes their profits earned abroad. Most developed countries tax only domestic earnings. While executives would welcome a lower tax rate and an end to global taxation, some worry their tax bills could rise under other measures that could be included in a tax-overhaul package.

Both Obama and Romney have said that they favor a slightly lower corporate rate, but I’m skeptical about their true intentions. In any event, neither one of them is talking about a low rate, perhaps 15 percent of below.

For more information, here’s my video on corporate taxation.

And the issue of worldwide taxation may sound arcane, but this video explains why it also is important.

Let’s close by noting that there are two obstacles to pro-growth reform. First, any good reform will deprive politicians of tax revenue. And since they’ve spent the country into a fiscal ditch, that makes it very difficult to enact legislation that – at least on paper – means less money flowing to Washington.

Second, politicians are very reluctant to lower tax rates on groups that can be demagogued, such as “rich people” and “big corporations.” This is the destructive mentality that drives class-warfare tax policy.

So America faces a choice. Jobs, investment, and growth or big government, class warfare, and stagnation. The solution should be obvious…unless you’re a politicians interested in preserving power in Washington.

Read Full Post »

Even though I’m not a Romney fan, I sometimes feel compelled to defend him against leftist demagoguery.

But instead of writing about tax havens, as I’ve done in the past, today we’re going to look at incremental tax reform.

The left has been loudly asserting that the middle class would lose under Mitt Romney’s plan to cut tax rates by 20 percent and finance those reductions by closing loopholes.

That class-warfare accusation struck me as a bit sketchy because when I looked at the data a couple of years ago, I put together this chart showing that rich people, on average, enjoyed deductions that were seven times as large as the deductions of middle-income taxpayers.

And the chart includes only the big itemized deductions. There are dozens of other special tax preferences, as shown in this depressing image, and you can be sure that rich people are far more likely to have the lawyers, lobbyists, and accountants needed to exploit those provisions.

But that’s not a surprise since the internal revenue code has morphed into a 72,000-page monstrosity (this is why I sometimes try to convince honest leftists that a flat tax is a great way of reducing political corruption).

But this chart doesn’t disprove the leftist talking point, so I’m glad that Martin Feldstein addressed the issue in today’s Wall Street Journal. Here’s some of what he wrote.

The IRS data show that taxpayers with adjusted gross incomes over $100,000 (the top 21% of all taxpayers) made itemized deductions totaling $636 billion in 2009. Those high-income taxpayers paid marginal tax rates of 25% to 35%, with most $200,000-plus earners paying marginal rates of 33% or 35%. And what do we get when we apply a 30% marginal tax rate to the $636 billion in itemized deductions? Extra revenue of $191 billion—more than enough to offset the revenue losses from the individual income tax cuts proposed by Gov. Romney. …Additional revenue could be raised from high-income taxpayers by limiting the use of the “preferences” identified for the Alternative Minimum Tax (such as excess oil depletion allowances) or the broader list of all official individual “tax expenditures” (such as tax credits for energy efficiency improvements in homes), among other credits and exclusions. None of this base-broadening would require taxing capital gains or making other changes that would reduce the incentives for saving and investment. …Since broadening the tax base would produce enough revenue to pay for cutting everyone’s tax rates, it is clear that the proposed Romney cuts wouldn’t require any middle-class tax increase, nor would they produce a net windfall for high-income taxpayers. The Tax Policy Center and others are wrong to claim otherwise.

In other words, even with a very modest assumption about the Laffer Curve, it would be quite possible to implement something akin to what Romney’s proposing and not “lose” tax revenue.

This doesn’t mean, of course, that Romney seriously intends to push for good policy. I’m much more concerned, for instance, that he’ll wander in the wrong direction and propose something very bad such as a value-added tax.

But Romney certainly can do the right thing if he wins. Assuming that’s what he wants to do.

Just like he can fulfill his promise the reduce the burden of government spending by implementing Paul Ryan’s entitlement reforms. But don’t hold your breath waiting for that to happen.

Read Full Post »

If you can read the following and not get upset, you are not a good person. Please move to France (where higher taxes are “patriotic”) and don’t come back.

I’m engaging in a bit of hyperbole, but you’ll hopefully understand after reading this excerpt from a very disturbing report posted on Zero Hedge.

Jacques Wajsfelner of Weston, Massachusetts is a criminal mastermind. Big time. Like Lex Luthor. But rest easy, ladies and gentlemen, for this nefarious villain is about to face some serious jail time thanks to the courageous work of US government agents. You see, Mr. Wajsfelner was finally caught and convicted of a most heinous crime: failing to disclose his foreign bank account to the US government. Note– he was not convicted of tax evasion. He was not convicted of failing to file or pay taxes. His crime was not filing the annual Report of Foreign Bank and Financial Accounts (FBAR). Because of his failure to disclose his foreign bank account, Wajsfelner is now looking at FIVE YEARS behind bars in a Day-Glo orange jumpsuit. Oh, one more thing– Wajsfelner is 83 years old. He was born in Germany during the global depression and rise of Adolf Hitler. The Wajsfelner family soon fled the Nazi regime and made its way to the United States.

Please note that Mr. Wajsfelner didn’t get convicted of not paying tax. He got convicted for the utterly trivial and victimless “crime” of not reporting a foreign bank account.

So the government is sending a completely harmless old man to jail for something that shouldn’t be illegal (and if we had a flat tax, there would be no double taxation of saving and investment, so it wouldn’t matter for tax purposes if your bank account was in Georgetown, Kentucky, or Georgetown, Cayman Islands).

Now let’s compare the treatment of Mr. Wajsfelner with the way some real criminals are treated.

Then there’s Eric Higgins of Port Huron, Michigan, who was recently busted for major possession of child pornography and engaging in sexually explicit conversations with juveniles online. He was given 20 months. Oh… and Mr. Higgins was a US Customs & Border Patrol agent. …Or Ricardo Cordero, another US Customs & Border Patrol officer who was given 27-months for personally smuggling 30 Mexican nationals into the United States, and assisting another smuggler to bring 15 Mexican nationals across the border. This genius even had the smuggler testify as a character witness at his divorce proceeding! Or Jon Corzine, former CEO of Goldman Sachs and member of the political elite, who presided over one of the largest plunders in the financial system ever seen during the recent MF Global collapse. He walks the streets freely to this day.

The article closes with a very accurate – but understated – assessment of the federal government.

It seems pretty clear where the US government stands: the victimless crime of failing to report a foreign bank account is far more egregious than, say, possession of child pornography, engaging with minors in online sex chat, bribery, extortion, fraud, and abuse of official power.

This horrifying example of government abuse is a good example of why I’m a libertarian. Yes, I get upset about bloated and counterproductive government spending. And I also get irked by our punitive and destructive class-warfare tax system.

But what gets me most upset is unfair tyranny against powerless people. If your stomach can stand it, here are some more examples.

Every one of the government officials involved in these episodes should be fired. And they should consider themselves lucky that tar and feathers are no longer a method of dealing with despicable bureaucrats.

P.S. The Zero Hedge website is also the source of the extremely funny and clever ethnic analysis of Europe.

P.P.S. While I utterly despise bureaucrats who engage in thuggish behavior, I’m not a big fan of bureaucrats in general.

P.P.P.S. The government’s grotesque treatment of Mr. Wajsfelner is part of the overall attack on tax competition. Heaven forbid people have the freedom to benefit from better tax policy in other jurisdictions!

Read Full Post »

The first cartoon mocks the egregious tactic of pandering for votes by fomenting group divisions (using other people’s money, of course).

This one is also reminiscent of the Sandra Fluke issue. For more on that you can check out this great Reason video here, another funny cartoon here, and four more jokes here.

The second cartoon highlights the media’s coverage of the White House.

If you want real-world examples of media bias, click here, here, here, here and here.

Read Full Post »

While I have strongly praised the GOP for embracing entitlement reform and supporting the Ryan budget, I’m not under any illusions that the average Republican politician is fully committed to free markets and limited government.

Even after the Tea Party election of 2010, there have been some very disappointing moments.

This doesn’t mean that GOPers are hopeless, but it does confirm my point that almost all politicians are a combination of good and bad impulses. It’s sort of like they have an angel on one shoulder and a devil on the other shoulder.

So who is winning, the angel or the devil? The Wall Street Journal opines in favor of the angel.

Four years in the wilderness seem to have had the salutary effect of returning the Party of Lincoln to a focus on government reform and economic revival. …The surprise is how quickly the GOP has rebounded from the routs of 2006 and 2008, starting in the states. …The reform momentum has since gained speed as a reaction to the Obama Presidency. First in 2009 with Chris Christie in New Jersey and Bob McDonnell in Virginia, Governors from the East across the Midwest and through the Southwest have won on reform agendas that they have been able to implement to varying degrees. …The common theme is ‘s ability to finance them. The contrast of these GOP states couldn’t be greater with the union-dominated Democratic governments of Illinois, California and Connecticut, which resist reform and simply default to ever-higher taxes. …The reform impulse has carried over to Washington, thanks to the Congressional victories of 2010. …Much of the credit here goes to the Tea Party, which has used GOP primaries to elevate reformers and motivate incumbents to change or face defeat.

I agree with much of the column, particularly the credit to the Tea Party and the indirect reference (“restraining governments that were growing far more rapidly than the private economy”) to Mitchell’s Golden Rule.

But I’m more pessimistic about whether the GOP has truly learned the right lessons from the failures of Bush-Rove era. Take this quiz and see if you share my qualms.

  1. If Mitt Romney wins and proposes to burden the U.S. economy with a value-added tax, would a majority of Republicans rise up in revolt and oppose that dangerous idea?
  2. If Mitt Romney wins and decides to only make cosmetic changes to Obamacare, would most Republicans rebel and push to fully repeal the costly legislation?
  3. If Mitt Romney wins and endorses a new version of TARP, would the Republican caucus stand firm in opposition?

To be blunt, I don’t think a majority of Republicans would do the right thing if these tests took place. The GOP leaders on the Hill, after all, are the same crowd that gladly supported all the reckless spending and foolish intervention of the Bush years.

Yes, there are some fresh faces and Tea Party types who would stand with taxpayers, but I don’t think they’re anywhere close to being a majority of the GOP caucus.

And don’t forget that the Republican establishment in Washington is heavily influenced by corrupt lobbyists – many of them former GOP politicians!

So what’s it all mean? Well, as the cartoon indicates, Republicans are now more likely to say the right thing. But rhetoric is easy. I’m much more interested in their actions.

The only great president of my lifetime famously said “trust, but verify.” But I don’t even trust the GOP, so I definitely want to see results first.

P.S. If you like the cartoon, you’ll like this poster featuring Ron Paul and this English-to-Republicanese dictionary.

Read Full Post »

I’ve done a few comparisons of economic performance under Reagan and Obama, sometimes using the interactive data from the Minneapolis Federal Reserve Bank.

And I’ve done a few TV interviews on the same subject.

But something was very different in this interview on the Fox morning show. I was asked to respond to the Obama campaign’s assertion that Barack Obama’s policies created more private-sector jobs than Ronald Reagan’s policies.

I confess that I did the interview without first checking the numbers, and may not have been overly animated since I was in Denver and had to wake up before 4:00 a.m., but I felt confident enough to joke about an intern torturing data in the bowels of the White House.

But now that I’m back at my desk and I’ve had a chance to review the numbers from the Bureau of Labor Statistics, I can now say, with full confidence, that Stephanie Cutter must be smoking crack (she’s also smoking hot, but that’s a separate discussion).

And her intern should be fired.

Here are the numbers for private sector jobs (technically “Private wage and salary workers”), looking at the first 42 months in office for both Reagan and Obama. I’m including both seasonally adjusted and raw numbers, just to show that there’s no way to slice the data to justify Ms. Cutter’s assertion.

And here’s a look at the comparative performance of Reagan and Obama, based on the percent increase in private jobs in the first 31 months.

I also looked at what would happen if agricultural and/or self-employed workers were added to the mix, but nothing changes. Reagan beats Obama with both hands tied behind his back.

And what makes these numbers even more stunning is that Obama took office in the middle of a downturn, so a lot of the job losses already had occurred. Reagan, by contrast, got hit with a recession after taking office. So even though I think that downturn can and should be blamed on Jimmy Carter, all of the job losses show up in Reagan’s column. Yet he still kicks the you-know-what out of Obama.

The lesson to draw from these numbers is that Presidents should reduce the burden of government if they want better economic performance. Saint Ronald understood this basic insight, but Barack the Destroyer somehow thinks America will be more prosperous if we mimic Europe’s welfare states.

Read Full Post »

I’m never guilty of being an optimist, but two items caught my attention today that suggest the tide may be turning on entitlement reform.

We’ll start with something from the New York Times.

Regular readers know that I’ve criticized that paper on a few occasions.

Sometimes it’s because of silly editorializing, such as this bit of amateur political analysis by Thomas Friedman, this foolish look at international taxation by the editors, and this laughable column arguing that America should copy Italy’s fiscal policy.

I also hit them for ignorant reporting, such as the story implying that things are free when they’re financed by government, this column that inadvertently makes the opposite point from what was intended, and this story mis-characterizing tax reform.

Paul Krugman, needless to say, is in a league of his own. I’ll just cite this beatdown about Estonia and leave it at that.

But it’s also important to cite good journalism when it occurs, and a new story in the New York Times on healthcare is a prime example. It’s straightforward and unbiased. And it shows the benefits of even small steps in the direction of markets. Here’s some of what Robert Pear wrote.

Even as President Obama accuses Mitt Romney and Representative Paul D. Ryan of trying to privatize and “voucherize” Medicare, his administration crows about the success of private health plans in delivering prescription drug benefits and other services to Medicare beneficiaries. More than a quarter of the 50 million beneficiaries receive coverage through private Medicare Advantage plans, mostly health maintenance organizations, and Medicare’s drug benefits are delivered exclusively by private insurers, subsidized by the government. …“Medicare Advantage premiums down 7 percent on average, enrollment up 10 percent,” the administration announced in February, and it said the quality of care under Medicare Advantage was improving. This month the administration reported the results of competitive bidding for 2013: “Medicare prescription drug premiums to remain steady for third straight year.” Federal spending on Medicare drug benefits has been about 30 percent lower than the Congressional Budget Office predicted when the drug legislation was passed in 2003. Mr. Ryan, a Wisconsin Republican who is the chairman of the House Budget Committee, said the drug program “came in below cost projections because it harnessed the power of choice and competition.”

Pear’s article raises an interesting issue about incremental reform. Proponents of liberty and markets obviously don’t like government-financed healthcare, but there are very-bad ways of doing the wrong thing and there are less-bad ways of doing the wrong thing.

That’s never an argument for doing something bad, but if bad policies already are implemented, then it does make sense to grab any opportunity to make those policies less destructive.

Ideally, we should restore free markets overnight. But given the constraints of the political system, I’ll gladly take the modest reforms that Paul Ryan is proposing for Medicare and Medicaid.

Here’s a back-on-the-envelope image I created to show the spectrum of healthcare policy. It’s obviously very simplified, but I think the overall point about Ryan’s reforms being very incremental is correct.

One final point about the political implications. President Obama clearly wants to scare seniors into thinking that the Ryan reforms are radical, but this is why the New York Times article is significant. It shows that Ryan isn’t proposing anything unusual, and it shows that the incremental reforms being proposed have a successful track record.

This may be why we’re now seeing some remarkable poll results.

Despite a furious onslaught of negative ads and harsh rhetoric, neither President Obama nor Mitt Romney has much of an advantage on critical issues heading into the fall campaign. …On Medicare — long considered a political vulnerability for Romney and his running-mate Paul Ryan — 49 percent of likely voters say Obama would handle the issue better while 48 percent prefer Romney. On health care, voters are just as divided — with 49 percent favoring Obama’s policies and 48 percent favoring Romney.

P.S. Since I’m favorably commenting on an article from the New York Times, allow me to remind you that the paper does publish good material every so often. They allowed this great column on tax sovereignty on their editorial pages, this powerful expose of IRS abuse by a business columnist, and this great graphic on the connection between big banks and government bailouts in Europe.

Read Full Post »

When I give speeches about entitlement reform, I often make the point that there’s nothing radical about Paul Ryan’s plan to reform Medicare.

Spending will go up, for instance, not down. And the reforms only affect people under age 55. This is evolutionary change, not revolutionary change.

But my main example is that future seniors, for all intents and purposes, will have a health plan similar to what’s now available for Members of Congress. Not only the politicians, but also their staff and the entire federal bureaucracy.

I’m not the only one to think this is a powerful point. Here are a couple of passages from Deroy Murdock’s National Review column on the topic.

The Medicare-reform proposal of presumptive GOP running-mate Paul Ryan is precisely as extreme as the health plan available today to every member of Congress. Ryan envisions average seniors’ being able to enjoy Capitol Hill–style medical options. This itself, however, would be a choice. Seniors who oppose choice in health coverage will be 100 percent welcome to remain within traditional Medicare. …Wyden-Ryan mirrors the way federal legislators buy health insurance. As FactCheck.org’s Brooks Jackson notes, “House and Senate members are allowed to purchase private health insurance offered through the Federal Employees Health Benefits Program, which covers more than 8 million other federal employees, retirees and their families.” …As FactCheck.org, elaborates, “All plans cover hospital, surgical and physician services, and mental health services, prescription drugs and ‘catastrophic’ coverage against very large medical expenses . . . There are no exclusions for preexisting conditions.” Participants may change plans during annual “open season” periods. Also, the government pays 72 percent of the average worker’s premium, with a maximum of 75 percent. Democrats cannot explain why Medicare recipients need to become congressmen to enjoy such choices in health coverage. If Ryancare, in essence, is good enough for senior citizens like Nancy Pelosi and Harry Reid, it’s good enough for any senior who wants it after 2022.

Deroy’s column shows how supporters of entitlement reform can counter some of the left’s demagoguery.

He’s making a point about political salesmanship, but it’s also important to understand why Medicare modernization is good healthcare policy.

Simply stated, the main healthcare problem in America is the third-party payer crisis. As explained in this video, markets are dysfunctional when government programs and other forms of intervention create a system where 89 cents out of every healthcare dollar is paid for by somebody other than the consumer.

Ryan’s Medicare reform doesn’t directly address this problem, just as block-granting Medicaid and reforming the tax system don’t automatically restore a market-based approach.

But if a sufficient share of future seniors use their premium support vouchers to buy high-deductible catastrophic insurance policies (which presumably will be the smart approach), then a growing share of routine medical expenses will be purchased directly by consumers – thus slowly but surely returning market forces to healthcare.

So I fully agree with Deroy that there are smart ways to promote the Ryan Medicare reforms. But I also want people to understand what it is that we want to accomplish.

I elaborate in my video on Congressman Ryan’s proposed Medicare reform.

Last but not least, check out this chart and you’ll begin to understand the potential benefits of fixing the third-party payer problem.

P.S. The current version of the Ryan plan, now known as Ryan-Wyden, is not as good as the original version because it keeps the current Medicare system as an option.

Read Full Post »

Like Sweden and Denmark, Germany is a semi-rational welfare state. It generally relies on a market-oriented approach in areas other than fiscal policy, and it avoided the Keynesian excesses that caused additional misery and red ink in America (though it is far from fiscally conservative, notwithstanding the sophomoric analysis of the Washington Post).

Nonetheless, it’s difficult to have much optimism for Europe’s future when the entire political establishment of Germany blindly thinks there should be more centralization, bureaucratization, and harmonization in Europe.

The EU Observer has a story about the agenda of the de facto statists in the Christian Democratic party who currently run Germany.

“Harmonization über alles!”

…what Merkel and her party are piecing together is a radical vision of the EU in a few years time – a deep fiscal and political union. The fiscal side involves tax harmonisation, a tightly policed Stability and Growth Pact with automatic sanctions for countries that breach debt and deficit rules, and the possibility of an EU Commissioner responsible for directly intervention to oversee budgetary policy in a crisis-hit country. …On the institutional side, the CDU backs a directly elected President of the European Commission as well as clearly establishing the European Parliament and Council of Ministers as a bi-cameral legislature with equal rights to initiate EU legislation with the Commission.

Keep in mind that the Christian Democrats are the main right-of-center party in Germany, yet the German political spectrum is so tilted to the left that they want tax harmonization (a spectacularly bad idea) and more centralization.

Heck, even the supposedly libertarian-oriented Free Democratic Party is hopelessly clueless on these issues.

Not surprisingly, the de jure statists of Germany have the same basic agenda. Here’s some of what the article says about the agenda of the Social Democrat and Green parties.

…its commitments to establish joint liability eurobonds and a “common European fiscal policy to ensure fair, efficient and lasting receipts” would also involve a shift of economic powers to Brussels. While both sides have differing ideological positions on the political response to the eurozone crisis – they are talking about more Europe, not less.

The notion of eurobonds is particularly noteworthy since it would involve putting German taxpayers at risk for the reckless fiscal policies in nations such as Greece, Italy, and Spain. That’s only a good idea if you think it’s smart to co-sign a loan for your unemployed and alcoholic cousin with a gambling addiction.

All this makes me feel sorry for German taxpayers.

Then again, if you look at the long-run fiscal outlook of the United States, I feel even more sorry for American taxpayers. Thanks to misguided entitlement programs, we’re in even deeper trouble than Europe’s welfare states.

Read Full Post »

It’s been more than one month since I posted the last collection of jokes and one-liners from the late-night talk show hosts.

So without further adieu, courtesy of the folks at Newsmax.com, are my favorites since that time. I’m surprised there’s not more material about Todd Akin, but that may change in coming days.

My favorite is the “50 states” comment from Leno.

Jay Leno

  • They’re now worried that Tropical Storm Isaac could hit Florida during next week’s Republican convention. But Florida is ready for it. Thanks to President Obama’s economic policies, many businesses down there are already boarded up.
  • Actually, Mitt Romney and Hurricane Isaac have something in common. They can both change directions at any moment.
  • It’s now being reported that Joe Biden will go to the Republican convention to try to cause problems for Mitt Romney. Then after that, he will go to the Democratic convention where he will definitely cause problems for President Obama.
  • At a campaign stop in Virginia, Joe Biden said he is such a NASCAR fan, “I’d trade being vice president in a heartbeat for winning Daytona.” To which President Obama said, “Deal!”
  • Happy birthday to gold medalist sprinter Usain Bolt. He turned 26 this week. You know the sad thing? His world-record time has already been broken by Republicans running away from Missouri Congressman Todd Akin.
  • Mitt Romney says if he is elected he will create 12 million new jobs in his first year in office — and that’s just people to do his taxes.
  • Todd Akin, the Republican Senate candidate from Missouri, is under fire for his controversial comments that women who are “legitimately raped are less likely to get pregnant.” The good news? Candidates who are legitimately that stupid are less likely to get elected.
  • President Obama met with Treasury Secretary Timothy Geithner in the Oval Office. They agreed on a new economic plan after losing last night’s big Powerball lottery.
  • President Obama is still reminding people that he inherited this economy. Let me tell you something. If this economy doesn’t turn around soon, his inheritance could be cut off in November.
  • After his latest gaffe, Joe Biden has a new slogan — “Chains you can believe in.”
  • Even though he made a number of gaffes this week, President Obama says he’s sticking with Joe Biden as his running mate, and Biden is thrilled. Of course he’s thrilled. Do you want to be looking for a job in this economy?
  • It was 109 degrees today in Los Angeles. It was so hot today, Joe Biden was putting his foot in his mouth just to cool it off.
  • President Obama visited a wind farm in Iowa. You know, just one wind farm with 50 turbines generates as much wind power as a single Joe Biden speech.
  • Mitt Romney kept his selection of Ryan as his VP nominee secret for more than a week. You know how he was able to keep it secret? He had it hidden with his tax returns.
  • Police in Florida have arrested a man who said he finally achieved his goal of shoplifting in all 50 states. You know what you call someone who steals from all 50 states? Congressman.

David Letterman

  • Missouri Congressman Todd Akin has some interesting views on health. I think he’s in a little hot water. Penn State took down his statue today.
  • Mitt Romney has asked Todd Akin to step down. That’s too bad. Todd Akin was the guy to lead the Republican Party into the 16th century.
  • Today the Republicans are getting ready for the convention. They’re busy down there in Florida auditioning minorities.
  • Paul Ryan likes to catch a catfish bare-handed. He’ll wade into a river and pull it out with his bare hands. Meanwhile, Chris Christie likes to reach into the tank at Red Lobster.
  • Mitt Romney has selected Paul Ryan as his running mate. They say this could be a big boost for the Republican ticket and I was thinking, “Well, Joe Biden could be a big boost for the Republican ticket, you know?”
  • Biden has made too many mistakes for Obama and he’s fed up. So today President Obama called Mitt Romney and asked Mitt if he would fire Biden.
  • I think Chris Christie is a good choice for the keynote speaker. I mean, is there a better symbol for belt tightening than Chris Christie?

Jimmy Fallon

  • CNN plans to air a 90-minute documentary on Mitt Romney before the Republican National Convention. Yeah, 90 minutes of Mitt Romney. Even Red Bull is like, “This is outta my league, bro.”
  • President Obama’s supporters can now text the word “GIVE” to donate up to $50 to his campaign, although it’s frustrating when autocorrect keeps changing it to “Fix the economy.”
  • It was just announced that most of the speakers at this year’s Democratic National Convention will be women. But it’s going to be annoying when they stop speaking, but won’t tell you why.
  • A hurricane could threaten next week’s Republican National Convention in Tampa. It could really hurt Republicans — which explains its name, “Hurricane Todd Akin.”
  • I read that one of the presidential debates will have a town hall format where citizens will ask the candidates questions. The most common question: “Are you the only two choices?”
  • New Jersey Gov. Chris Christie said he will think about running for president in 2016 if Obama wins in November. But until then he said he’ll just think about pancakes.

You can persuse earlier versions of jokes from the late-night comics by clicking here, here, here, here, here, here, herehereherehereherehereherehereherehereherehere, and here.

Read Full Post »

I’ve written about the TSA being a wasteful, stupid, and ineffective bureaucracy, and I’ve also shared some good anti-TSA humor (see the links in this post, which also contains an amazing visual).

Today, let’s focus on the wasteful and ineffective part. It seems that Keystone Cops of airport security have a new “pilot program” that is unpleasantly reminiscent of the old internal passport regime maintained by South Africa in the apartheid era.

Here is some of what one passenger wrote about his experience.

I came face-to-face with Big Brother the other day, and it was a frightening experience. He actually presented himself in the deceptive form of a young, attractive female officer, working for the Transportation Security Administration at Detroit Metropolitan Airport. At first she simply seemed chatty and friendly. She looked at my airline boarding pass and noted that I was coming from Denver. Then she mentioned that I was headed from Detroit to Grand Rapids. “That’s a pretty short flight,” she said. “Talk to my travel agent,” I grumbled. At that point she asked me what my business would be in Grand Rapids. “I’m headed home,” I replied. Then she wanted to know where home was. That’s when the mental alarms went off and I realized I was being interrogated by Big Brother in drag. I asked her why the federal government needed to know where I was going and what I would be doing. She explained that the questions were part of a new security “pilot program.” I then told her I am an American citizen, traveling within my own country, and I wasn’t breaking any laws. That’s all the federal government needed to know, and I wasn’t going to share any more. Not because I had anything to hide. It was because we live in a free country where innocent people are supposedly protected from unwarranted government intrusion and harassment.

Good for Mr. Gunn. Here’s more of his story.

At that point the agent yelled out, “We have another refusal.” One of my bags was seized and I was momentarily detained and given a hand-swab, which I believe was to test for residue from bomb-making materials. I passed the bomb test and was told I could move on, but I hung around a moment and told everyone within listening range what I thought about this terrifying experience. So, this is what we’ve come to. The federal government now has a need to know where citizens are going and what they are doing before they are allowed to peacefully pass. I’m starting to wonder what separates us from Russia or Cuba. …TSA officers, being the brilliant people they are, are given the responsibility of picking out airline passengers “whose facial expressions, body language or other behavior indicate a security risk.” They are then subjected to a “chat down,” where officers interrogate you and decide if you are indeed a terrorist.

I confess I’m not as brave as Mr. Gunn. I wouldn’t want to risk missing a flight because a peevish bureaucrat deliberately delayed me. But I fully agree with his conclusion.

This program is a bizarre and outlandish violation of the Fourth Amendment to the U.S. Constitution, which is supposed to protect us from “unreasonable search and seizure” by agents of the government, unless they have probable cause. I doubt any judge would have considered my droopy face as sufficient cause for harassment. I lived through 9/11 and I understand the need for tight security at airports. …The idea is to keep dangerous materials that could be used in a terrorist attack off commercial airliners. Fair enough. But stopping people because they look sort of funny to security agents, and probing into their personal business, is going too far. What’s next? Check lanes on city streets, where jackbooted thugs from Washington, D.C., will stop everyone every morning to ask them where they’re going and what they’re up to? And if our answers are not what the government wants to hear, perhaps we’ll be sent home and put under surveillance, to make sure we’re not involved in anything that Big Brother doesn’t approve of. Our freedom is severely compromised when government is allowed to do this sort of thing. We are supposed to be presumed innocent and able to come and go as we please, as long as we don’t break any laws or give authorities reason to believe we may have. The “chat down” program has been a failure, by the way, at least according to a recent editorial published in USA Today. TSA officials interviewed about 725,000 travelers at Logan International Airport in Boston over the course of one year, and none of them turned out to be terrorists. ..There is no justification for this type of unwarranted harassment in America. Even people who look a little different should be allowed to move about as they please, unless they give authorities a specific reason to stop them.

So what’s all this mean? What’s the answer. Simple. Put the private sector in charge, as Arnold Kling and Nick Schulz have argued. As Steve Chapman explains, there were lots of benefits to the pre-TSA system.

(h/t: J.D. Tuccille)

Read Full Post »

Earlier this month, I posted some risqué Romney humor, and a few days later I hit Obama with a very funny poster.

Today, in keeping with this bipartisan approach, here are three videos. Two of them make fun of the presumptive GOP nominee and one mocks the boy-crying-wolf way that the left cries racism whenever someone criticizes Obama.

We’ll start with this video, which effectively dings Romney for his lack of core convictions. The guy who does Romney’s voice is very good.

I’ve criticized Romney for a bunch of statist policy positions, but I confess that I have no idea if he actually believes in those views – just like I have no idea if he’s sincere when he says something I like.

That’s what makes the video so effective.

Obama girl could influence my vote

This next video is also worth sharing, but I don’t think it’s as effective. First, the “Romney Girl” isn’t as attractive as the “Obama Girl,” and that matters when trying to reach immature males in the audience (like me!).

Second, the guy playing Romney doesn’t look like him.

On the other hand, the video deals with one of my favorite topics and also involves one of my favorite nations.

So watch and judge for yourself.

If you want a quick and serious explanation of why the “tax haven” charge against Romney is without merit, feel free to peruse this post.

But this post is more about whether videos are politically effective, not whether they’re accurate.

Now let’s look at a video mocking the Obamanoids for reflexively crying racism.

I have no doubt that there are some racists who don’t like Obama, but it is a bit over the top to see some leftists routinely cry race when they’re losing arguments.

But if I had to defend Obama’s miserable economic record, I supposed I’d have to cry wolf as well.

Read Full Post »

It’s not often that I read something by Paul Krugman and think, “Good point, I hope he’s correct.”

After all, I had to correct Krugman’s inaccurate analysis of Estonia, and also point out the errors in what he wrote about the United Kingdom. And I also noted mistakes he made when writing about Canada and France.

And let’s not forget his absurd assertion that it would be good for the U.S. economy if aliens threatened to attack!

It certainly seems as if he specializes in making mistakes.

But he has just written something that sort of makes sense.

In pushing for draconian cuts in Medicaid, food stamps and other programs that aid the needy, Mr. Ryan isn’t just looking for ways to save money. He’s also, quite explicitly, trying to make life harder for the poor — for their own good. In March, explaining his cuts in aid for the unfortunate, he declared, “We don’t want to turn the safety net into a hammock that lulls able-bodied people into lives of dependency and complacency, that drains them of their will and their incentive to make the most of their lives.”

To be more specific, I hope Krugman is right in that Ryan wants “to make life harder for the poor” if the alternative is to have their lives stripped of meaning by government dependency.  And I agree that it will be “for their own good” if they’re motivated to join the workforce.

To be sure, Krugman wants readers to reach the opposite conclusion. Even though the War on Poverty seems to have put an end to the progress we were making (see this remarkable chart), Krugman equates spending money with compassion.

And I suppose I should point out that he is completely wrong (using dishonest Washington budget math) when writing about “draconian cuts” since Cong. Ryan is merely proposing to slow down how fast government spending is growing.

P.S. For those who want more information, watch this video to learn about how government anti-poverty programs hurt the poor.

P.P.S. Check out this map to see how various U.S. states subsidize poverty.

P.P.P.S. To get your blood boiling, read this horrifying post about how a left-wing international bureaucracy conspiring with the Obama White House to redefine poverty in ways that make America look bad.

Read Full Post »

Back in 2010, I posted some fascinating (at least to me) data on the underlying differences between conservatives, liberals, and libertarians.

That same year, I also wrote about whether evolutionary history helps explain why some people are leftists.

Let’s now reexamine the difference between those on the right and those on the left, based on some data in a fascinating report from the Chronicle of Philanthropy on the generosity of 359 cities in America.

It turns out that “red state” America is far more generous than “blue state” America. I was thinking of writing about the implications of this new research, but I found out that somebody else beat me to it – and said everything I could possibly say.

Here’s some of what Jeff Jacoby wrote about this study.

According to the Chronicle, the most generous city in America is Provo, Utah, where residents typically give away 13.9 percent of their discretionary income. Boston, by contrast, ranks No. 358: In New England’s leading city, the median household donates just 2.9 percent of its income to charity. Provo’s generosity is typical for its region. Of the 10 most generous cities in America, according to the Chronicle’s calculations, six are in Utah and Idaho. Boston’s tight-fistedness is typical too: Of the 10 stingy cities at the bottom of the list, eight are in New England — including Springfield (No. 363) and Worcester (No. 364). What’s the matter with Massachusetts? How can residents of the bluest state , whose political and cultural leaders make much of their compassion and frequently remind the affluent that we’re all in this together , be so lacking in personal generosity? And why would charitable giving be so outstanding in places as conservative as Utah and Idaho? The question is built on a fallacy.Liberals, popular stereotypes notwithstanding, are not more generous and compassionate than conservatives. To an outsider it might seem plausible that Americans whose political rhetoric emphasizes “fairness” and “social justice” would be more charitably inclined than those who stress economic liberty and individual autonomy. But reams of evidence contradict that presumption, as Syracuse University professor Arthur Brooks demonstrated in his landmark 2006 book, Who Really Cares .

Jacoby summarizes the entire discussion in these two sentences.

…this doesn’t mean that there aren’t generous philanthropists in New England. It doesn’t mean selfishness is unknown on the right. What it does mean is that where people are encouraged to think that solving society’s ills is primarily a job for government, charity tends to evaporate.

In other words, statists pretend to be compassionate. And they compensate for their stinginess by wanting to squander our money.

The fact that government programs generally hurt the people they’re designed to help seems irrelevant to them. It’s all about good intentions. But only good intentions with someone else’s cash.

P.S. If you want a less serious look at the differences between various groups, here’s a funny post on the differences between liberals, conservatives, and Texans.

P.P.S. Sometimes people have irreconcilable differences, which is why this post about the right and left getting a divorce is amusing.

P.P.P.S. We already know, from this clever video, that rich left-wingers like the idea of higher taxes for everybody else, but conveniently say no when they’re asked to pay more.

Read Full Post »

Now that new numbers have been released by the Congressional Budget Office, it’s time once again for me to show how easy it is to balance the budget with modest spending restraint (though please remember our goal should be smaller government, not fiscal balance).

  • I first did this back in September 2010, and showed that we could balance the budget in 10 years if federal spending was limited so it grew by 2 percent annually.
  • I repeated the exercise in January 2011 after new CBO numbers were released, and re-confirmed that a spending cap of 2 percent would eliminate red ink in just 10 years.
  • In August of that year, following the release of the CBO Update, I showed again that the budget could be balanced by limiting spending so it climbed by 2 percent per year.
  • Most recently, back in January after CBO produced the new Economic and Budget Outlook, I crunched the numbers again and showed how a spending cap of 2 percent would balance the budget.

I’m happy to say that the new numbers finally give me some different results. We can now balance the budget if spending grows 2.5 percent annually.

In other words, spending can grow faster than inflation and the budget can be balanced with no tax hikes.

And here’s the video I narrated almost two years ago on this topic. The numbers have changed a bit, but the analysis is exactly the same.

In other words, ignore the politicians, bureaucrats, lobbyists, and special interests when they say we have to raises taxes because otherwise the budget would have to be cut by trillions of dollars. They’re either stupid or lying (mostly the latter, deliberately using the dishonest version of Washington budget math).

Modest fiscal restraint is all that we need, though it would be preferable to make genuine cuts in the burden of government spending.

Read Full Post »

Here’s a riddle for policy wonks. What do you get if you take my videos on the  economics of government spending and mix them in a blender with my videos on America’s entitlement crisis?

You get this concise but compelling video from the Blaise Ingoglia at Government Gone Wild.

Blaise has several other videos I strongly recommend.

You’ll notice a common theme in all his videos: He lays out the facts in a blunt, hard-hitting manner.

And if you watch all of them, you’ll realize that government is the problem, not the solution.

Read Full Post »

I enjoy anti-Republican humor just as much as anti-Democrat humor. That’s why I posted this very funny anti-Romney image.

And it’s why Congressman Todd Akin of Missouri has painted a bulls-eye on his back with his comments about rape and abortion. I’ve seen several good cartoons about his debacle, but this one is my favorite because there are several jokes combined in one image.

And here’s another good one. It doesn’t have the multiple components of the first cartoon, but sometimes a blunt-instrument approach also is effective.

Last but not least, just to show I’m truly non-partisan, you can find my favorite examples of anti-libertarian humor by clicking here.

Read Full Post »

Okay, it’s a pathetic title for this post, but it seems fitting for this cartoon (which you’ll notice fits with the theme of this funny image).

And since we’re beating this horse, here are two videos featuring the President’s teleprompter, including one from Iowahawk (though it’s not quite as good as his famous Pelosi-mobile video, which is the gold standard for political humor).

Read Full Post »

I agree with George Will that it’s okay to reduce Pentagon spending. After all, the United States accounts for almost one-half of the world’s military outlays, about twice as much as the combined total of possible enemies.

But I also agree that national defense is one of the few legitimate functions of the federal government, so I want to make sure we get the most bang for the buck (no pun intended) from every penny.

That’s why I get especially irritated when I read horror stories about Pentagon waste.

But in many cases, it’s not the fault of the Generals and Admirals. America’s military is forced to waste money because the politicians in Washington are motivated by cronyism, corruption, pork, and political correctness.

For example, let’s look at an excerpt from a column in the Washington Examiner.

Imagine you’re a legislator in a country with a bloated budget of almost $4 trillion and a record level of spending that requires massive deficits and could mean job-killing tax increases. Now imagine you’ve got a weapons program that is billions over budget, a decade behind schedule and unwanted even by those for whom it is intended. What would you do? If you said, “Earmark the program another $380 million,” you’re apparently qualified to serve on the U.S. Senate Appropriations Committee. The weapons program is the Medium Extended Air Defense System, a joint venture with Germany and Italy that was zeroed out by three of four relevant congressional funding authorities. But the Senate Appropriations Subcommittee on Defense decided the program was worth a $380 million earmark, and the full committee passed the final bill along with a unanimous vote.

I’m not an expert on weapons systems. Heck, I know less about such matters than Obama’s cabinet knows about the economy. But it certainly seems foolish to throw good money after bad on a program that doesn’t work. Especially when the military doesn’t want it!

And here are a couple of sentences from a Forbes column about part of the military budget being diverted to subsidize solar power.

EPA regional headquarters?

The U.S. Army is looking for a few good renewable energy projects. Some $7 billion worth. On Tuesday the Army began accepting bids for green energy installations that will be deployed on military bases and facilities across the U.S. The Army will sign contracts to buy the electricity generated by solar, wind, geothermal and biomass projects for up to 30 years. …The program is part of a Department of Defense initiative to meet at least 25% of energy demand on its bases from renewable sources by 2025. The military is also aiming its bases to become “net zero” consumers of electricity – generating more power than they use by installing solar and other renewable energy systems.

Silly me. I thought the Pentagon was responsible for keeping the nation safe. I guess I missed the memo where it was tasked with being a tool for the green agenda.

These examples doubtlessly are just the tip of the iceberg. Politicians can’t resist turning anything they touch into a vehicle for graft, waste, and foolishness.

To be sure, there are also big picture issues of national security that have to be resolved. Is NATO now an anachronism, as Steve Chapman persuasively argues? Is overseas intervention a pointless exercise, as Mark Steyn explains?

But whatever the mission, the Pentagon’s ability to carry it out is compromised when politicians treat the military budget like a goodie bag.

Read Full Post »

When I was a kid, I was a big fan of Robin Hood. I remember reading at least two books recounting the legend and I watched the Errol Flynn version of the movie several times.

And, as an adult, I saw both the Kevin Costner and Russell Crowe versions of Robin Hood.

“I’m not an occupy-Wall-Street moocher”

None of this makes me an expert, but it does allow me to state with some confidence that Robin Hood was not a left-wing hero who stole from the rich and redistributed to the poor.

Instead, he was a quasi-libertarian tax protestor. Okay, maybe it’s an exaggeration to claim he was a libertarian, but Robin Hood was on the side of ordinary people who were being exploited by incessant tax demands from the ruling class. His main enemies were Prince John and the Sheriff on Nottingham, not the medieval equivalents of Wall Street.

In the Russell Crowe version of the movie, Robin Hood even gives a speech about the importance of liberty.

So you can imagine how irked I get when statists agitate for things such as the “Robin Hood Tax” in this moronic video. But what motivated me today is a story in the Financial Times about a Cesar Chavez wannabee politician from Spain.

For Spain’s ruling politicians he is a criminal; for his supporters he is Robin Hood, stealing from supermarkets and redistributing the food to the poor. Juan Manuel Sánchez Gordillo, the mayor of Marinaleda, a southern town with a population of 2,600, has been catapulted to cult hero status in Spain after setting out this week on an anti-austerity march across Andalucia – occupying banks and stealing food… “We are fighting a war for the poor … going to jail is not important for me, it would be an honour,” Mr Sánchez Gordillo told the Financial Times. “We are going to occupy all of the banks and supermarkets we are able to in Andalucia. The robbers who have caused this crisis must pay the consequences for what they have done.”

But if the Mayor really wants to make robbers pay, he should march straight to jail and turn himself in. Not for the empty publicity stunt of robbing grocery stores, but for being part of a political class that has dramatically increased the burden of government spending in Spain, from about 30 percent of GDP in 1980 to well over 40 percent today.

But don’t hold your breath waiting for self-awareness from this clown.

Not surprisingly, unions are part of the protest. I’m guessing that Mr. Canamero represents government employees.

On Friday, the marchers, who plan to sleep in the open or in parks, occupied a branch of Banco Santander in the town of Mancha Real in the province of Jaén before leaving later in the day. Diego Canamero, head of the Andalucian Workers Union, was in the branch on Friday. He said critics of the protests were politicians protecting their own interests. “These are symbolic actions against an unsustainable economic situation,” he said. “The bankers rob us, and take our money to tax havens…”

The dig against tax havens is particularly laughable. Ordinary Spaniards should hope and pray that their deposits in the local banks are safely re-deposited in banks based in well-run and honest jurisdictions such as Switzerland, the Cayman Islands, or Singapore.

And if they’re smart, they already cut out the middleman and directly placed their savings in one of these low-tax jurisdictions. That way, they’re not only at much less risk of a bank collapse, but they also have greater ability to protect their assets from the venal and incompetent tax-hungry political elite.

Returning to the mischaracterization of Robin Hood, this Payne cartoon does a good job of capturing my thoughts.

I especially like how Payne shows that the left-wing version of Robin Hood is all about a perniciously corrupt version of redistribution (though he should have included the Export-Import Bank on the side of the van). The genuine poor get crumbs while the well-connected interests make out like bandits.

P.S. Other good Payne cartoons can be seen here, here, herehereherehere, and here.

Read Full Post »

Back in 2010, I posted a fascinating map from the Economist website, showing debt burdens (as a share of GDP) for nations around the world. This data showed lots of red ink, with Western Europe generally being more indebted than the United States.

In 2011, I posted some charts from a study by the Bank for International Settlements, revealing that the long-run fiscal outlook for the United States is worse than the outlook for European nations.

In other words, our politicians to date haven’t over-spent as much as their counterparts in Europe, but it appears that – if government is left on auto-pilot – America will suffer more from excessive government than European nations in the future.

Here’s some new evidence about the perilous long-term state of public finances in America. According to the Organization for Economic Cooperation and Development, the United States has to do more than almost every other nation to avoid becoming another Greece.

If this data is correct, the United States isn’t just in danger of becoming Greece. It’s actually in worse shape than Greece. Not just Greece, but every other European welfare state as well. That doesn’t bode well.

But time for some caveats. The OECD research mistakenly focuses on debt levels and what needs to happen to reduce red ink to a certain level. This isn’t a meaningless issue, but it puts the cart before the horse. What matters most is the size of government and the total burden of government spending – not whether it is financed with borrowing rather than taxes.

This doesn’t mean the long-run estimates are wrong. But if the focus is on the real problem of government spending, then it is much more apparent that the only feasible solution is to restrain the growth of government spending.

If the burden of government spending grows slower than the economy’s productive sector (i.e., Mitchell’s Golden Rule), then deficits and debt fall. To be blunt, if you cure the disease, the symptoms automatically disappear.

Which helps explain why I’m a fan of the Ryan budget, particularly his reforms to Medicare and Medicaid.

P.S. Regular readers know I’m not a fan of the OECD (for many reasons), but the economists at the Paris-based bureaucracy generally are competent at putting together good data. It goes without saying, of course, that this doesn’t justify raping taxpayers to subsidize economists.

Read Full Post »

I’m sure all the non-Bulldawwg readers may not be waiting with breathless anticipation, but I can’t resist a celebratory post about the Georgia Bulldogs winning the 2012 Capital Alumni Network softball championship.

We handled #4-seed American University in the semifinal game, with a workmanlike 14-6 victory.

Then, as the scoreboard below illustrates, we let #1-seed Ohio University get a lead before opening a can of you-know-what and grinding them into the dust.

The only bad news is that I couldn’t be there for the final, much less have a chance to contribute. I’m sitting at Dulles Airport, waiting for a flight to Chicago.

Normally, I would never schedule a flight to interfere with something important like softball, but the tournament was supposed to end yesterday.

But the news isn’t all bad, I got upgraded to first class. Not much consolation, but I’ll take it.

Read Full Post »

I’ve certainly complained about Obamacare from a fiscal perspective, warning that it means higher taxes and more spending.

And I’ve also warned that it will make our health care system less efficient and could lead to some of the horrifying examples of rationing and poor care that you find in the United Kingdom (scroll to the bottom of this post for some shocking examples).

But if you need another reason to be upset, it turns out that Obamacare is going to be a very lucrative gig for a new crop of government bureaucrats.

Here are some very disturbing details from the Pueblo Chieftan in Colorado.

Eye-popping salaries proposed for employees of the health benefits exchange being formed in Colorado grabbed the attention of Republicans and Democrats alike on Thursday. A subcommittee of the board charged with establishing the exchange  is considering a draft budget for its federal grant application that would create 24 positions and pay those employees a total of more than $3 million annually to manage the health care cooperative. The average annual salary of a health benefits exchange employee would exceed $125,000 under the plan. …“We have executive directors (of state departments) that are in charge of thousands of people here that make significantly less than that,” said Sen. Bill Cadman, R-Colorado Springs. …A Democrat on the committee overseeing enactment of health benefits exchange legislation in the state agreed that the figures are worthy of scrutiny. …Under the health care overhaul, states were required to establish exchanges. Colorado authorized its exchange this year in SB200.

Keep in mind that the $125,000 figure is an average, which means many of the bureaucrats will be getting much bigger paychecks.

“Obamacare is a great racket!”

And also remember that we’re talking Colorado, not someplace like New York City where the cost of living is a bit higher.

Even more important, the article refers to the “average annual salary,” which means it probably doesn’t include the gold-plated benefit packages that are far more generous than generally available in the private sector (state and local bureaucrats, for instance, make out like bandits on pensions).

And to show that this story is just the tip of the iceberg, let’s recycle my video about overpaid government bureaucrats.

And if all the data in the video doesn’t convince you, check out this chart.

Read Full Post »

Beginning last weekend with wins over Indiana, Arizona State, and LSU, followed earlier today with victories over George Mason University (my other alma mater), Virginia Tech (defending champs from 2011), and Vanderbilt, the Georgia Bulldogs have advanced to the Final 4 of the Capital Alumni Network softball tournament.

We play tomorrow at 11:00 against American University (#4 seed). If we get past them, we play the winner of the game between Ohio University (#1 seed) and James Madison University.

Our hero in the Sweet-16 game against Virginia Tech was Chris Walters, who hit a 3-run inside-the-park home run to tie the game when we were down to our last out.

In the Elite-8 game against Vandy, Marieo Foster was the man, with three home runs, each one more titanic than the previous blast.

Yours truly sadly didn’t contribute anything, but us old guys at least provide a steadying veteran presence. Or something like that.

Here’s a pic of the team “calling the Dawgs” before one of the games.

We began the season way back on April 1, when we won the SEC-ACC preseason tournament.

So keep your fingers crossed that we can win two games tomorrow and give the Bulldogs a much-deserved title to close out the season.

Read Full Post »

For some reason, I haven’t seen much political satire about the GM/Chrysler bailout.

Indeed, the only bailout humor I found in my archives are this funny cartoon about the Federal Reserve helping to bail out Europe and this very good cartoon about Greece deciding to take more handouts from the rest of Europe.

But these two cartoons hopefully are a start of a new trend.

If you like Payne’s work, you can view more of my favorites here, herehereherehere, and here.

Some of my favorite Bok cartoons can be seen here, hereherehereherehere, and here.

P.S. Here’s one more bailout cartoon, featuring a hapless taxpayer playing a rigged blackjack game with Fannie Mae and Freddie Mac.

P.P.S. How can I forget one of the most popular humor posts in the history of this blog, this image of how the bailout-hungry Greeks view the rest of Europe (with bonus sections showing how Americans view Europe, how the English view Europe, and – be forewarned – how the former Italian Prime Minister viewed Europe).

P.P.P.S. I commented the other day on the cost of the bailout jumping to $25 billion. It’s actually a lot higher when you count other bailout expenses, as John Ransom explains.

Read Full Post »

I feel like a pendulum this election season. Something will happen that makes me want to eviscerate Obama’s statist policies and I’ll write a foaming-at-the-mouth post warning that the President is turning America into Greece.

But then Romney will do something odious and I’ll sound the warning sign with a we-don’t-need-another-big-spender-like-Bush post.

Today, it’s Obama’s turn on the chopping block. I went on Neil Cavuto’s Fox Business News program and commented on the fact that the President doesn’t have a fiscal plan.

We started by discussing the President’s failure to embrace the findings of his own Fiscal Commission and then shifted to the big-picture issue of whether the American people have become ensnared by the dependency mindset and are willing to vote for Greek-style fiscal policy.

One thing I should have added is that Obama actually does have a fiscal plan. He’s just not willing to be as honest as the leftists who have admitted that you need to screw the middle class with higher taxes to fund big government.

My own personal guess is that he would impose a value-added tax if he thought it was politically feasible. Not that I’m showing any great insight. After all, Obama already has made the ridiculous statement that a VAT is “something that has worked for other countries.”

But because he’s running for reelection, he’d rather just demagogue the Ryan plan rather than show his own cards.

P.S. Even the cartoonist for the Washington Post doesn’t think the VAT is something that is working for other countries. This cartoon is a classic and definitely worth sharing. And you can enjoy other VAT cartoons here and here.

Read Full Post »

Every so often, you read something so ridiculously stupid and absurd that you assume that you’re being pranked. So you look to the date of the article to see if it says April 1. Or you look at the Internet address to see if it’s a parody of a real website.

So when I read a column suggesting that the United States should become more like Italy, I thought this must be some sort of practical joke. After all, Italy is teetering on the edge of bankruptcy, kept afloat by bailouts and subsidies. Its economy is in the toilet, with pervasively high unemployment, almost no growth for a decade, and living standards that are only about two-thirds of U.S. levels.

The Italian government is also famously incompetent (naming the wrong people to high-level posts), with stifling levels of regulation, a dysfunctional fiscal system, and a corrupt legal system (and when it’s not crooked, it’s inane).

Notwithstanding all these crippling flaws, Italy has something akin to catnip for the left. It has a punitive tax burden, and that means it must be a nation worth emulating.

Here’s some of what Eduardo Porter wrote for the New York Times.

Italy may be in a funk, with a shrinking economy and a high unemployment rate, but the United States can learn a lot from it, and not just about the benefits of public health care. Italians live longer. Their poverty rate is much lower than ours. If they lose their jobs or suffer some other misfortune, they can turn to a more generous social safety net. …The reason is not difficult to figure out: rich though we are, we can’t afford the policies needed to improve our record. …But though the nation’s fiscal challenge has taken center stage in the presidential election campaign, raising more taxes from American families remains stubbornly off the table.

I’m willing to believe Italians live longer, but every other assertion in that passage is upside down. Yes, they have more subsidies for joblessness, but that’s one of the reasons they have higher unemployment (as even Paul Krugman and Larry Summers have acknowledged).

And the claim about less poverty is laughable. I’m guessing the author naively relied upon the slipshod analysis from the statists at the Organization for Economic Cooperation and Development. Those bureaucrats put together a moving-goalposts measure of income distribution and falsely categorized it as a tool for measuring poverty.

Setting aside these mistakes, the column is designed to convince people that we should give more money to Washington.

Citizens of most industrial countries have demanded more public services as they have become richer. And they have been by and large willing to pay more taxes to finance them. Since 1965, tax revenue raised by governments in the developed world have risen to 34 percent of their gross domestic product from 25 percent, on average. The big exception has been the United States. …the United States raises less tax revenue, as a share of the economy, than every other industrial country. No wonder we can’t afford to keep more children alive. In 2007, the most recent year for which figures are available, the United States government spent about 16 percent of its output on social programs — things like public health, food and housing for the poor. In Italy, that figure was 25 percent. …Every other industrial country has a national consumption tax, which can be used to raise a lot of money.

I will give the author credit. If you read the entire column, it’s clear he wants all Americans to pay higher taxes, not just the so-called rich. So at least he’s being honest, unlike a lot of statists (click here for a list of honest leftists who admit you can’t finance big government without screwing the middle class).

But honesty about goals doesn’t mean desirability of policy. If America becomes more like Italy, it will mean Italian-style stagnation and joblessness.

And it’s particularly worrisome to see that the author wants a value-added tax, which is a sure-fire way of giving politicians a big pile of money that will be used to expand the burden of government spending.

I have nothing against copying other nations, either when they get one policy right (such as Estonia’s flat tax or Australia’s system of personal retirement accounts), or when they get a bunch of policies right and routinely rank at the top for economic freedom and prosperity (such as Hong Kong and Singapore).

But I’m mystified by those who look at failure and conclude America should do likewise.

P.S. The Italians have a bad tax system, but they don’t meekly comply. Whether they’re firebombing tax offices or sailing yachts to other countries, they are a powerful example of the Laffer Curve insight that higher tax rates don’t necessarily translate into higher tax revenues.

Read Full Post »

Older Posts »

Follow

Get every new post delivered to your Inbox.

Join 2,394 other followers

%d bloggers like this: