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Archive for the ‘Politics’ Category

I work at the libertarian Cato Institute (aka, America’s most effective think tank), and I think libertarianism is the philosophy that best reflects human decency.

But I sometimes wonder why libertarians aren’t more persuasive and why there aren’t any libertarian societies.

However, maybe there’s a light at the end of the tunnel. I’ve been asked by several readers to comment on the debate about whether America is enjoying a libertarian phase, particularly among the so-called millenials. This discussion was triggered by a feature article in the New York Times magazine.

You won’t be surprised to learn that I hope the answer is yes. So it goes without saying (but I’ll say it anyhow) that my fingers are crossed that Nick Gillespie of Reason is correct is his reaction to the NYT article.

Though I worry that the social capital of the American people (of all ages) has been sufficiently eroded that they won’t permit the entitlement reforms and program restructurings that are necessary to control – and hopefully reduce – the burden of government spending. So perhaps David Frum’s take in The Atlantic is more accurate, even if I hope he’s wrong.

For what it’s worth, I’m a bit more optimistic after reading Ben Domenech’s analysis for The Federalist.

I’m a fiscal policy wonk rather than a big-picture libertarian, so I’m not particularly qualified to assess who is right. That being said, you can sense a bit of my hopefulness in the post-post-postscript below.

P.S. Since we’re on the topic of libertarianism, let’s talk about Harry Reid’s favorite people, Charles Koch and David Koch.

If you get your news from the establishment media, you doubtlessly think these supposedly evil billionaire brothers are dictating political outcomes with their ostensibly lavish spending on campaigns.

Yet if you look at a list of the top 100 individual donors to political races, David Koch is #90 and Charles Koch isn’t even on the list.

Some of you may be thinking that they funnel their largesse through other vehicles, but even when you look at organizational giving, Koch Industries is only #36 on the list.

Paul Bedard of the Washington Examiner slices and dices the data.

…only two of the nation’s top 20 donors to federal campaigns favor the GOP, and a stunning 11 are labor unions including the AFL-CIO, and both teachers unions, according to a new report. The highly respected Center for Responsive Politics put the pro-Democratic fundraising group ActBlue at the top of the organization donor list, coughing up over $30 million, with 99 percent going to Democrats. Way down at No. 36 is Koch Industries, the conservatively run company Democrats claim control the GOP. …Among individuals, former New York Mayor Michael Bloomberg ranked second in donations, with $8,710,678 of his $9,495,798 going to Democrats and Democratic causes. …Among individual donors, the top three are also Democrats. The rest of the list is evenly split in who they give money to.

P.P.S. Since we’re talking about the Kochs, I find it laughable that conspiracy mongers on the left somehow thought I was worth including in this flowchart.

The other people are all donors, directors, or executives. I’m just a policy wonk. Heck, they didn’t even make the one connection that does exist, which is the fact that I used to be married to Nancy.

P.P.P.S. On the other hand, I feel honored but unworthy to have been subject of a profile by the folks at United Liberty.

According to the title, I’m the “guardian angel” of American taxpayers. Needless to say, I wish I had the power to protect folks from rapacious government. Here’s what the article actually says about my angelic qualities.

World renowned tax expert and Cato Institute scholar Dan Mitchell thinks of politicians as characters in old cartoons that, when faced with a decision, suddenly find they’ve an angel on one shoulder and a devil on the other, both handing out advice as to the right move. He sees himself, flashing a grin that signals you shouldn’t take him too seriously, as the angel. “My job is to convince [politicians] to do what’s right for the country, not what’s right for their own political aspirations,” he says.

The article also explains what got me involved in the fight for liberty.

Mitchell has both a bachelor’s and master’s degree in economics from UGA, as well as a PhD in economics from George Mason University. But he got his start as a limited government conservative as a high school student who, like many others, found himself struck by the wisdom of Ronald Reagan. “I was drawn to his message that government was the problem, not the solution,” he says. “One thing that was definitely part of Regan’s philosophy that I got right away was that you shouldn’t punish success and you shouldn’t reward bad behavior.” Reagan, he says, accomplished more on spending than people give him credit for, and succeeded largely due to his policy of tax rate reductions, the taming of inflation, the slight reduction in all federal spending, and the massive shift away from domestic spending toward defense spending.

But regular readers already know I have a man-crush on The Gipper.

The final excerpt explains why I’m slightly optimistic, though I certainly don’t expect to put myself out of a job.

…he is a patriot who cares about the future of America.“What matters most is that somehow, in the next couple of years, Congress needs to approve, enact, and implement [Paul] Ryan’s entitlement reforms — block-granting medicaid and turning medicare into a premium support system,” he says. “It’s the only way to save the country.”Otherwise, we become “France at best, Greece at worst.”  …he notes that “if you want to be optimistic, progress comes rather quickly” once proper reforms are in place, and the transition is not terribly painful. But what happens if he gets his wish? Isn’t he working to put himself out of a job?“I’m sure there will be enough bad government policy to keep me occupied for the rest of my life,” he laughs. “As much as I would like to put myself out of a job, I have so far not demonstrated that level of competence.”

Simply stated, even if we get genuine entitlement reform and put the brakes on wasteful discretionary spending, it will still be a full-time job to keep the politicians from backsliding.

Anyhow, read the entire profile if you have a few minutes to kill.

P.P.P.P.S. Building on the superb image of bread, capitalism, and socialism, let’s close with something for our collection of pro-libertarian humor

…as well as something for our collection of anti-libertarian humor.

Reminds me of the libertarian lifeguard cartoon, at least in the sense that we supposedly are indifferent to children.

Though obviously an absurd caricature. After all, libertarians want school choice to help poor kids while the statists are the ones standing in the schoolhouse door.

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I periodically share polling data. This is because public opinion research (if done honestly) provides insights on the degree to which people are either well informed, uninformed, or misinformed.

And that kind of information is useful for policy wonks like me since it shows where we need to re-double our efforts to educate the American people.

And some of the best polling data today comes from the periodic Reason-Rupe survey. They ask fair questions (i.e., they’re trying to discover what people actually think rather than doing “push polls” designed to produce pre-determined results) and they ask interesting questions.

But that doesn’t mean I always like the answers. Reason-Rupe just did a major survey of Americans between ages 18 and 29. Perhaps I’m being a glass-half-empty person, but I’m not overly encouraged by the answers from these so-called millenials.

Heck, I’m tempted to say that the voting age should be raised to 30.

Is this because of how they voted in the past two elections?

Young Americans (ages 18-29) have shifted markedly left in their voting behavior over the past decade. …by 2008, 66 percent voted for Barack Obama, as did 60 percent in 2012.

Nope, that’s not why I’m distressed about millenials. It’s hard to blame voters for turning against the GOP after eight years of Bush’s big-government paternalism. Moreover, both McCain and Romney held a lot of statist views, so I didn’t view the 2008 and 2012 elections as a rejection of libertarianism or small-government conservatism. The Reason-Rupe experts have a similar assessment.

The Republican Party—which rhetorically lays claim to free markets, limited government, and fiscal responsibility—found itself lacking credibility… The Republican Party’s policy mishandlings tainted not just its own brand, but those who share its rhetoric. Messengers selling free markets and limited government under the GOP banner have found it more difficult to reach a trusting audience.

At most, millenials were guilty of believing the nonsensical hype that Obama was some sort of post-partisan leader.

So why, then, am I distressed about the Reason-Rupe poll results? Mostly because millenials appear to be scatterbrained.

We’ll start with the good news. In some ways, they seem very sensible.

…millennials are not statists clamoring for government management of the economy. Quite the opposite. Millennials are still free marketeers—they like profit and competition, they prefer capitalism over socialism… There has been a surge in the share of millennials who think government is wasteful and inefficient… Most also think government agencies abuse their power… Millennials say hard work brings success, as older generations do. They also believe in self-determination and say that individuals are and should be primarily responsible for both their successes and failings, even if this leads to unequal outcomes. Millennials are concerned about growing income inequality, but they prefer a competitive, merit-based society that rewards personal achievement over one with little income inequality. …nearly three-fourths of millennials support “changing the Social Security program so younger workers can invest their Social Security taxes in private retirement accounts.”

But before you conclude millenials have their heads on straight, let’s look at these results.

A plurality of millennials says there is more government should be doing… the cohort still favors social welfare spending and a variety of government guarantees. …Millennials are more favorable toward socialism than they are to a government-managed economy, even though the latter is arguably less interventionist. …Millennials are far more likely than Americans over 30 to identify as liberal. While only 14 percent of Americans over 30 call themselves liberals, 25 percent of millennials do the same. …They support raising taxes to increase financial assistance to the poor, they think government should guarantee access to health care, and a slim majority favors guaranteeing access to college. …American millennials agree government should spend more to help the poor even if it leads to higher taxes. …Nearly seven in 10 say government should guarantee health insurance and a living wage. …The plurality of millennials (48 %) think people usually get rich at the expense of others, a zero-sum view of wealth in society.

So does this mean young voters are statists?

Perhaps, but the most accurate conclusion is that they simply don’t know enough to give consistent answers.

A 2010 CBS/New York Times survey found that when Americans were asked to use their own words to define the word “socialism” millennials were the least able to do so. Accord to the survey, only 16 percent of millennials could define socialism as government ownership, or some variation thereof, compared to 30 percent of Americans over 30 (and 57% of tea partiers, incidentally).

So maybe we should raise the voting age to 30.

Or at least have a rule that says you can’t vote until you have a job and are paying taxes (that might be a good rule for all ages!).

Now that we’ve tried to figure out how millenials are thinking, let’s look at the entire population.

And let’s focus on just one issue: How many Americans think corruption is widespread in government.

The good news is that Gallup found that a record number of Americans recognize that the public sector is a sleazy racket for the benefit of bureaucrats, lobbyists, contractors, politicians, cronies, interest groups, and other insiders.

By the way, I like these results, but they don’t necessarily mean that people want to shrink government. As we saw with the data on millenials, it’s possible for people to favor more government even though they think that it is corrupt, wasteful, and inefficient.

But at least (I hope) this means that they are susceptible to the common-sense message that shrinking government is the most effective way of reducing corruption.

Last but not least, I’m not sure this qualifies as an opinion poll, but it does deal with responses to questions.

It turns out that “unattractive” people are most likely to donate to the Occupy Wall Street movement.

A new series of studies from Stanford researchers has found that people who feel “unattractive” are more likely to donate to the Occupy movement. …participants were then asked to rate their own attractiveness… Finally, after watching a short video about the Occupy Movement, participants were asked if they would like to donate their compensatory $50 lottery ticket to the movement. Researchers found that those who perceived themselves to be less attractive were almost twice as likely to donate to Occupy.

And while we don’t have any research on this issue, I’m going out on a limb and asserting that folks who donate to America’s best think tank are beautiful, charming, debonair, suave, virile, and popular.

P.S. But as you can see here, here, here, here, here, here, and here, the Occupy protesters did generate some good political humor, so they’re not all bad.

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The internal revenue service has allowed itself to become a tool of the White House. To be more specific, bureaucrats at the tax-collection agency sought to undermine a free and fair political process by stifling political speech. And now the IRS is lying about its activities and trying to cover its tracks.

This should be deeply horrifying to all Americans, regardless of political affiliation or philosophy.

Particularly since the partisan Democrat appointed by Obama to head the IRS refuses to even apologize for the agency’s rogue behavior.

There are several appropriate responses to the IRS scandal, including some genuine budget cuts. But you probably won’t be surprised to learn that some people think the IRS instead should be rewarded with even more money.

Here are some excerpts from a column in today’s Washington Post.

…this is an especially strange time to stick up for the agency, given the suspicious disappearance of a few thousand key e-mails that Congress wants to see. But right now, the IRS desperately needs a champion. …the IRS has been laboring…with fewer resources. Since 2010, when Congress first began hacking away at discretionary spending, the bureau’s funding has fallen 14 percent, in inflation-adjusted terms… These cuts have come even though the agency’s responsibilities and workload have increased, thanks to new laws such as the Affordable Care Act and the Foreign Account Tax Compliance Act… Now House Republicans want to hobble it even more. Last week, the House Appropriations Committee voted to slash the bureau’s budget by another $340 million.

It’s true that both Obamacare and FATCA grant new powers and obligations to the IRS, but we can solve that problem by repealing those misguided laws.

But since that won’t happen while Obama is in the White House, let’s consider whether “fewer resources,” “hobble,” and “hacking away” are accurate ways of describing what’s been happening to the IRS’s budget.

The Office of Management and Budget has detailed tables showing spending by agency. And if you look at the administrative portions of IRS spending (culled from lines 2491-2533 of this massive database), it turns out that spending has increased dramatically over time.

Yes, it’s true that IRS spending has declined slightly since 2010, but the agency’s budget is still about twice as big as it was 30 years ago. And these numbers are adjusted for inflation!

In other words, it’s very misleading to focus merely on the post-2010 budgetary data (just as Krugman was being deceptive when he looked only at post-2007 data when writing about Estonia’s economic performance).

Looking at the historical data reveals that the IRS budget is much bigger than it’s been in the past.

There are a couple of additional points in the column that deserve some attention. The author argues that people who care about the budget deficit should be delighted to give more money to the IRS because it produces a “darn good return on investment.”

If you care about narrowing the budget deficit — as Republicans generally say they do — gutting your chief revenue- collection agency makes little sense. …The IRS generates way more money than it spends, after all. For every dollar appropriated to the IRS in the 2013 fiscal year, the agency collected $255, according to the national taxpayer advocate’s office. That’s a darn good return on investment.

Wow, what a scary mindset. Based on this thinking, why don’t we simply give the government carte blanche to seize our bank accounts? After all, they could probably collect hundreds of thousands of dollars for every dollar spent. That would be an even better “return on investment.”

As an aside, this is an example of why I get so agitated when supposed fiscal conservatives focus on deficits and debt. It creates an opening for people who want to push bad policy. But if you focus on the real problem of government spending, that problem disappears.

But I’m digressing. Let’s get back to the column. There’s one other point that cries out for correction. The author claims that a bigger IRS budget will reduce tax evasion and that this will keep tax rates from going higher.

Some of that money comes from going after tax cheats, and…rampant tax evasion has a tendency to drive statutory tax rates higher so that the government can extract more money from those poor saps still obeying the law.

The only problem with this assertion is that it is grossly inconsistent with the facts.

We have very powerful evidence that politicians lowered tax rates during periods when there were substantial flows of money to so-called tax havens.

Why? Because they felt competitive pressure to implement less onerous tax rates in order to keep even more money from escaping.

And now we have strong evidence that tax rates are going up as opportunities to escape bad tax policy have decreased.

Why? Because the politicians now feel that taxpayers have fewer escape options.

To summarize this post, the IRS needs and deserves more money in the same way that Charles Manson needs and deserves a group hug.

Here’s one last bit of humor to augment the cartoons I’ve already included. It’s PG-13, so don’t read too closely if you get easily offended.

P.S. Wouldn’t it be wonderful if we could junk the tax code and replace it with a simple and fair flat tax? That would eliminate almost every possible conflict with the IRS and also take away the agency’s discretionary power.

Not a bad fantasy to have, at least for a policy wonk.

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When I wrote recently that the IRS was corrupt, venal, and despicable, I didn’t realize that I was bending over backwards to be overly nice.

Every new revelation in the scandal shows that the agency is beyond salvage.

Writing for Real Clear Markets, Diana Furchtgott-Roth of the Manhattan Institute is appropriately skeptical of the IRS.

Coincidentally, Lerner’s computer crashed 10 days after Congress expressed concern about possible targeting of conservative groups. Emails between January 2009 and April 2011 were lost. Her computer is not available for examination, because it has already been recycled by the IRS. In a further coincidence, or not, a backup tape of agency emails made by the IRS was erased after 6 months. …As Georgia Republican Rep. Doug Collins said, the story sounds more and more implausible.

Diana then explains why this matters, using Obamacare as an example of why we should worry about a corrupt and politicized IRS.

Why should we care about missing emails from 2009 to 2011? As former Secretary of State Hillary Clinton said in a 2013 hearing about Benghazi, “What difference at this point does it make?” It is not just that Americans’ basic trust in the IRS is being called into question. Over the past five years the IRS has been concentrating its power, giving the agency increased opportunities to pick on people and groups it dislikes. …Sarah Hall Ingram, who was commissioner of the IRS’s Tax-Exempt and Government Entities Division from 2009 to 2012 during the Lois Lerner scandal, now heads the IRS Affordable Care Act Office. …Do Americans trust the IRS to calculate these subsidies and refunds impartially? The IRS already made a power grab in May 2012 by extending premium subsidies to the 34 states with federal exchanges.

She also points out that the IRS is carrying water for the President’s attempt to stifle opposing views.

…the IRS proposed regulations that would allow the agency to regulate the free speech of President Obama’s political opponents, while leaving the political activities of his friends untouched. …The regulations were targeted at tax-exempt organizations that file under 501(c)(4) of the IRS code… Under the new rules these groups would not be allowed to engage in voter education that mentions a candidate within two months of a general election or one month of a primary. Left untouched by the proposed regulations were unions, which file under 501(c)(5) of the Internal Revenue Code.

Stan Veuger of the American Enterprise Institute also is not persuaded by the IRS’s deceitful excuses.

The Internal Revenue Service (IRS) and the administration have consistently spouted lies and half-truths about the IRS scandal. The latest development in the controversy is that crucial emails have conveniently gone missing – is there any reason to believe that it is, as the administration claims, a mere accident? …This effort to keep conservative 501(c)(4) organizations from attempting to prevent president Obama’s reelection was, of course, hidden from the public. Ms. Lerner was careful to try and structure the IRS’ targeting in such a way that would not be appear to be a “per se political project,” in her own words, and denied in meetings with, and letters to, congressional oversight staff in 2012 that conservative groups were treated exceptionally or that the IRS’ ways of evaluating 501(c)(4)s had ever changed. The claims were false… In her response to a planted question from the audience at an American Bar Association tax conference, Ms. Lerner blamed the targeting of conservative groups on “our line people in Cincinnatti.” This has also turned out to be false. …non-Tea Party groups were never subjected to the same delays and investigations as Tea Party groups were. This once more suggest that obfuscation and dishonesty were central to the IRS’ approach to their targeting practices.

He even crunches some numbers to show that the claims from the IRS are utterly implausible.

It would be very helpful to see what communications took place between IRS officials and other Democrats. And this is where the missing emails come in. …They are gone, they now tell us, hard drives crashed and tapes were erased. Should we believe that? Of the 82 IRS employees tied to the targeting operation, 7 had their email disappear, or 8.5%. According to IRS commissioner John Koskinen, the industry standard is 3 to 5%. Under reasonable statistical assumptions, that makes the IRS scandal disappearance rate about as likely as the emails having been eaten by unicorn, with a probability far smaller than 1%. Given the IRS’ track record in this affair, that is way beyond anything that would justify giving the IRS and Lois Lerner the benefit of the doubt.

Amazingly, 12 percent of Americans believe the IRS. Here’s some polling data that Phil Kerpen shared on his twitter feed.

I’m particularly happy that younger people are more skeptical. They’re more tech-savvy and realize that the IRS’s excuses are a bunch of….well, a bunch of stuff that comes out of male cows.

And here are some good cartoons on the topic, starting with Eric Allie’s gem.

I like how he includes a representative of the 12 percent of deliberately gullible Americans.

And here’s another contribution from Allie.

And here’s Steve Kelley’s cartoon on the topic.

He’s right, needless to say. It would be better if the IRS was merely squandering money rather than seeking to subvert the democratic process.

Last but not least, here’s an evergreen cartoon about the IRS from Glenn McCoy.

Oh, and let’s not forget two other items.

The political hack who now heads the IRS is a partisan leftist.

IRS Commissioner John Koskinen contributed more than $85,000 to Democratic candidates and committees…with a $5,000 donation to President Obama in 2012 and $19,000 to the Democratic National Committee from 1988 to 2008.

And the political hack who was forced out of the IRS actually wanted to target a US Senator.

…the Internal Revenue Service’s (IRS) targeting of conservative individuals includes a sitting United States Senator. According to emails reviewed by the Committee under its Section 6103 authority, …Lois Lerner sought to have Senator Chuck Grassley (R-IA) referred for IRS examination.

There are more horror stories to share, but this is enough for one day.

Suffice to say, you can understand why my fantasies involve tax reform rather than supermodels.

P.S. I can’t resist one more comment. Don’t forget that the corrupt and partisan IRS is in charge of Obamacare enforcement, but the bureaucrats want to be exempt from that government-run healthcare system. Just like politicians.

The moral of the story: Washington is even worse than you think. It’s a racket for insiders, but a burden for the rest of us.

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The establishment fervently believes that more money should come to Washington so that politicians have greater ability to buy votes.

That’s why statists from both parties are so viscerally hostile to Grover Norquist’s no-tax-hike pledge. They view it as an obstacle to bigger government.

And it also explains why politicians who raise taxes are showered with praise, especially when they are Republicans who break their promises and betray taxpayers.

Which is why President George H.W. Bush was just awarded a “profiles in courage” award for raising taxes and breaking his read-my-lips promise by the crowd at Harvard’s Kennedy School.

Here’s some of what was reported by the Dallas News.

Former President George H.W. Bush was honored Sunday with a Kennedy “courage” award for agreeing to raise taxes to confront a spiraling deficit, jeopardizing his presidency that ended after just one term. …The budget deal enacted “responsible and desperately needed reforms” at the expense of Bush’s popularity and his chances for re-election, Schlossberg said. “America’s gain was President Bush’s loss, and his decision to put country above party and political prospects makes him an example of a modern profile in courage that is all too rare,” he said.

I’m not surprised, by the way, that Mr. Schlossberg praised Bush for selling out taxpayers.

But I am disappointed that the Dallas News reporter demonstrated either incompetency or bias by saying that Bush raised taxes to “confront a spiraling deficit.”

If you look at the Congressional Budget Office forecast from early 1990, you’ll see that deficits were on a downward path.

CBO 1990 Deficit Forecast

In other words, Bush had the good fortune of inheriting a reasonably strong fiscal situation from President Reagan.

Spending was growing slower than the private economy, thanks in part to the Gramm-Rudman law that indirectly limited the growth of spending.

So Bush 41 simply had to maintain Reagan’s policies to achieve success.

But instead he raised taxes. That got him an award from the Kennedy School this year…and it resulted in bigger government in the early 1990s.

Writing for National Review, Deroy Murdock is justly irked that President George H.W. Bush was given an award for doing the wrong thing.

…former president George Herbert Walker Bush received the Profile in Courage Award from the John F. Kennedy Library Foundation. What intrepid achievement merited this emolument? Believe it or not, breaking his word to the American people and hiking taxes by $137 billion in 1990.  …Bush’s tax hike was a political betrayal for Republicans and other voters who believed him when he pledged to the 1988 GOP National Convention: “Read my lips: No new taxes.” …Bush violated his promise and hiked the top tax rate from 28 percent to 31. Bush also imposed a luxury tax on yachts and other items. This led to a plunge in domestic boat sales and huge job losses among carpenters, painters, and others in the yacht-manufacturing industry.

The worst result, though, was that the tax hike enabled and facilitated more government spending.

Here are the numbers I calculated a couple of years ago. If you look at total spending (other than net interest and bailouts), you see that Bush 41 allowed inflation-adjusted spending to grow more than twice as fast as it did under Reagan.

And if you remove defense spending from the equation, you see that Bush 41’s bad record was largely the result of huge and counterproductive increases in domestic spending.

With such a bad performance, you won’t be surprised to learn that market-oriented fiscal experts do not remember the Bush years fondly.

Deroy cites some examples, including a quote from yours truly.

“Bush’s tax hike repealed the real spending restraint of Gramm-Rudman and imposed a big tax hike that facilitated a larger burden of government spending,” says Cato Institute scholar Dan Mitchell. “No wonder the statists . . . are applauding.” …“Of course the Left wants to celebrate Bush’s broken tax promise,” Moore says. ”It is what cost Republicans the White House and elected Bill Clinton…” says Grover Norquist, president of Americans for Tax Reform. “This is an award for stupidly throwing away the presidency to the Democrats…” Norquist further laments: “You never see a Democrat get a ‘courage’ award for saying ‘No’ to the spending-interest lobby.”

The moral of the story is that Washington tax-hike deals are always a mechanism for bigger government.

And President George H.W. Bush should be remembered for being a President who made Washington happy by making America less prosperous. As I wrote last year, “He increased spending, raised tax rates, and imposed costly new regulations.”

Hmmm…an establishment Republican President who increased the burden of government. If that sounds familiar, just remember the old saying, “Like father, like son.”

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If you like to go along to get along, I suggest you don’t become a libertarian. At least not if you follow politics or work in Washington.

Otherwise, you’re doomed to a life of endlessly pointing out that the emperor has no clothes. Here are three examples.

1. When almost every Republican and Democrat argued for a Keynesian-style stimulus in 2008, libertarians had the lonely job of explaining that you don’t get more growth by increasing the burden of government spending.

2. And when most Republicans and Democrats said we needed a TARP bailout that same year, it was libertarians who futilely argued that the “FDIC-resolution” approach was a far more sensible way of dealing with the government-created crisis.

3. More recently, there were a bunch of stories complaining that 2013 was a very unproductive year for Congress, and libertarians were among the few to state that we’re better off with fewer laws rather than more laws.

The same is true for “bipartisanship.” Almost every pundit, politician, and lobbyist in Washington will extol the virtues of bipartisanship. But what they really mean is that they want both Republicans and Democrats to join arms in a business-as-usual game.

Indeed, the standard libertarian joke is that you get bipartisanship when the Stupid Party and the Evil Party both agree on something. Needless to say, that often means laws that are both stupid and evil.

Which is a good description of Bush’s 2008 stimulus and the corrupt TARP legislation.

But since we’re at the end of the year, I don’t want to get overly depressed. So let’s share some cartoons that celebrate the Murray-Ryan budget, which is the most recent example of “bipartisanship.”

We’ll start with ones that have a Christmas theme.

The politicians were glad to escape the fiscal constraint of sequestration, but Lisa Benson is not overly impressed by their cooperative effort.

Budget Deal Cartoon 8

Gary Varvel isn’t very happy, either.

Budget Deal Cartoon 1

Varvel is very explicit in this cartoon about Democrats and Republicans being united against taxpayers.

Budget Deal Cartoon 4

The bag should have been labelled “spending,” but that’s a minor complaint.

Steve Breen points out that the budget deal achieved three out of four goals.

Budget Deal Cartoon 2

And Michael Ramirez astutely identifies too much spending as the problem and shows that the budget deal did nothing to address that issue.

Budget Deal Cartoon 3

Here’s another Lisa Benson cartoon, though this one focuses on establishment GOPers trying to hook the Tea Party on the demon rum of big government.

Budget Deal Cartoon 5

Sort of reminds me of this great Henry Payne cartoon about Obama and Greece. Or maybe this Nate Beeler cartoon about weak-willed GOPers.

I’ve saved the best for last.

This Glenn McCoy cartoon shows what bipartisanship really means inside the DC beltway.

Budget Deal Cartoon 6

McCoy had another cartoon last year with a similar theme, as did Michael Ramirez.

In closing, I want to say something vaguely optimistic. The Murray-Ryan budget deal was unfortunate, but it was a rather minor setback compared to the kinds of “bipartisan” big-government schemes we got during the Bush years.

It was sort of akin to the fiscal cliff deal at the beginning of the year. Government got a bit bigger and a bit more expensive, but it was peanuts compared to TARP, the prescription drug entitlement, and many of the other schemes that eroded economic liberty last decade.

P.S. Fairness requires that I point out that bipartisanship doesn’t automatically mean bad legislation. The bipartisan 1997 budget deal between the GOP Congress and Bill Clinton cut some taxes and reduced the growth of federal spending. And the successful sequester came about because of the bipartisan 2011 debt limit legislation.

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Let’s do a simple thought experiment and answer the following question: Do you think that additional laws from Washington will give you more freedom and more prosperity?

I don’t know how you will answer, but I strongly suspect most Americans will say “no.” Indeed, they’ll probably augment their “no” answers with a few words that wouldn’t be appropriate to repeat in polite company.

That’s because taxpayers instinctively understand that more activity in Washington usually translates into bigger and more expensive government. Or, to be more colloquial, this image summarizes how they view Washington. And the last thing you want is more “action” when you’re on the lower floor.

Sort of like living downwind from the sewage treatment plant.

So what’s the purpose of our thought experiment? Well, new numbers have been released showing that the current Congress is going to set a modern-era record for imposing the fewest new laws.

But while most of us think this is probably good news, Washington insiders are whining and complaining about “diminished productivity” in Congress. The Washington Post, which is the voice of DC’s parasite class, is very disappointed that lawmakers aren’t enacting more taxes, more spending, and more regulation.

…this Congress — which is set to adjourn for the year later this month — has enacted 52 public laws. By comparison, …90 laws were encated during the first year of the 113th Congress and 137 were put in place during the first year of the 111th Congress.

Just in case you don’t have a beltway mindset, another Washington Post report also tells you that fewer laws is a bad thing.

…whatever gets done in December will still be part of a year with record-low congressional accomplishment. …According to congressional records, there have been fewer than 60 public laws enacted in the first 11 months of this year, so below the previous low in legislative output that officials have already declared this first session of the 113th Congress the least productive ever.

Let’s actually look at some evidence. The first session of the current Congress may have been the “least productive” in history when it comes to imposing new laws, but what’s the actual result?

Well, there are probably many ways this could be measured, but one of the most obvious benchmarks is the federal budget.

And it appears that “record-low congressional accomplishment” translates into a smaller burden of government spending.

Indeed, government spending actually has declined for two consecutive years. That hasn’t happened since the 1950s.

And it’s worth reminding people that you begin to solve the symptom of red ink when you address the underlying disease of too much spending. That’s why the deficit has fallen by almost 50 percent in the past two years.

Interestingly, the Washington Post accidentally confirms that you get better policy when you have fewer news laws.

In 1995, when the newly empowered GOP congressional majority confronted the Clinton administration, 88 laws were enacted, the record low in the post-World War II era.

Needless to say, the author isn’t saying that we got good policy because there were a “record low” number of laws in 1995. But if we look at fiscal policy during that period, that’s when we began a multi-year period of spending restraint that led to budget surpluses.

In other words, we should be very grateful for “unproductive” politicians.

Now for some caveats.

It’s obviously a gross over-simplification to assert that the number of laws is correlated with good policy or bad policy. Sometimes politicians impose laws that increase the burden of government (with Obamacare being an obvious example).

But sometimes they enact laws that increase economic liberty and reduce government (with the sequester being a good example, even though very few politicians actually wanted that result).

To conclude, the message of this post is that we shouldn’t worry about “diminished productivity” in Washington if it means fewer bad laws.

That being said, we’ll never fix a corrupt tax code or reform bankrupt entitlement programs unless there are new laws to replace old laws that created bad policy.

P.S. Since we’re talking about low productivity in Washington, there’s good evidence that bureaucrats don’t work very hard compared to workers in the economy’s productive sector. But that’s probably a good thing. After all, do we want bureaucrats (like this one) being more diligent? That’s why we should focus on reducing their excessive compensation rather than encouraging them to put in a full day’s work.

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Citing polling data with poorly (or dishonestly) worded questions, anti-Second Amendment ideologues often argue that gun control is popular.

The real test, though, is what happens on election day. That’s why it was such big news when two incumbent Democrats from Colorado’s State Senate were defeated in a recall election.

They both represented districts that had voted for Obama, yet they were easily tossed out of office after voting for legislation to restrict the rights of law-abiding citizens.

Well, as Yogi Berra would say, it’s deja vu all over again. Another statist politician has been forced out of a job in Colorado. Here are some details from a local news report.

Sen Evie Hudak

Political thug gives up her seat after undermining constitutional freedoms

State Sen. Evie Hudak has decided to resign rather than risk facing a recall election… Hudak, D-Westminster, could have been the third Democratic lawmaker to face a recall over a package of gun control bills they helped pass earlier this year. Sens. John Morse, D-Colorado Springs, and Angela Giron, D-Pueblo, both decided to fight recall elections against them, but were ousted in September in favor of Republican replacements.

So why is she throwing in the towel? Because she thinks she will lose and that would give the GOP control of the State Senate.

Hudak is playing it safe. By resigning before the signatures are turned in, she assures that a Democratic vacancy committee will appoint her replacement, keeping the seat — and the senate — in the party’s hands, at least through November, when her successor will be forced to win reelection.

It’s almost a shame that there won’t be a recall election. Not because I care about whether Republicans take over the State Senate, but rather because I would like to see the outgoing Napoleonic Mayor of New York, Michael Bloomberg, squander more of his fortune on another Colorado contest. He blew a lot of money on the earlier gun-related recall elections, and he also dropped a lot of cash on a failed effort to replace the state’s flat tax with a so-called progressive scheme that would set Colorado on a path to becoming another California.

But I won’t let that little detail reduce the happiness I feel that a political thug has been forced to resign. Particularly since that sends a signal to other politicians all across the nation.

Since we’re on the topic of gun control, this is a great opportunity to call attention to a powerful column by Stephen Halbrook. He explains how the Nazis used gun control to advance their totalitarian and murderous agenda.

Historians have documented most everything about it except what made it so easy to attack the defenseless Jews without fear of resistance. Their guns were registered and thus easily confiscated.

He provides some of the sordid history of the period.

The Nazis immediately used the firearms-registration records to identify, disarm and attack “enemies of the state,” a euphemism for Social Democrats and other political opponents of all types. …The Gestapo cautioned the police that it would endanger public safety to issue gun permits to Jews. …By fall of 1938, the Nazis were ratcheting up measures to expropriate the assets of Jews. To ensure that they had no means of resistance, the Jews were ordered to surrender their firearms. …This scenario took place all over Germany — firearms were confiscated from all Jews registered as gun owners. …Under the pretense of searching for weapons, Jewish homes were vandalized, businesses ransacked and synagogues burned. Jews were terrorized, beaten and killed. Orders were sent to shoot anyone who resisted. SS head Heinrich Himmler decreed that possession of a gun by a Jew was punishable by 20 years in a concentration camp.

So what’s the message. Halbrook puts it in very stark terms.

Today, gun control, registration and prohibition are depicted as benign and progressive. Government should register gun owners and ban any guns it wishes, Americans are told, because government is inherently good and trustworthy. The experiences of Hitler’s Germany and, for that matter, Stalin’s Russia and Pol Pot’s Cambodia, are beneath the realm of possibility in exceptional America. Let’s hope so.

Most people assume that such awful things could never happen in America.

And maybe they’re right. But when you look at very grim numbers showing that the United States is headed for a fiscal collapse, and when you consider that there already has been rioting in Europe as the welfare state implodes, it doesn’t require a very vivid imagination to think that America could face some very tough times in the not-too-distant future.

That’s why I argued, in this interview with NRA TV, that gun ownership is very important in the event of societal breakdown.

Let’s conclude with a bit of gun control satire.

My fourth-most viewed post is a montage of dictators who supported gun control. But some dictators are worse than others.

And the former head of the National Socialists definitely is in that category.

So, given the wise words we just read from Stephen Halbrook, let’s all keep in mind this very powerful message from Jews for the Preservation of Firearms Ownership.

Hitler gun control

P.S. If you want more information on gun control, I strongly recommend this analysis from an actual firearms expert, as well as remarkable admissions from leftists that can be read here and here.

P.P.S. If you’re interested, my three posts with the most views are the set of cartoons showing why welfare states collapse, a joke about California and Texas, and a story of how you can use beer to explain the tax system.

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While I’m critical of the overall design and impact of President Obama’s economic policy, I don’t have a partisan agenda and I’m willing to give the White House credit when it’s warranted.

I’ve pointed out, for instance, that Obama has increased spending at a slower rate than his GOP predecessor. That may be damning with faint praise since Bush was a big spender, but at least Obama didn’t open the money spigot in Washington even wider.

I also gave Obama some grudging praise for opposing a French tax harmonization scheme.

Heck, I even went out of my way to find something vaguely positive to say about Obamacare.

And I’ve shared some pro-Obama humor and even (sort of) defended Obama from the accusation that he’s a socialist.

So I think I have at least some ability to dispassionately judge (from a libertarian perspective) how President Obama ranks in comparison to others who have held the office.

I’m motivated to address this issue because several readers sent me an article in the Huffington Post that makes a rather remarkable claim.

Barack Obama is one of the greatest presidents America has ever seen. I believe history will prove this, and with time, he will be remembered in the annals of history as a revered revolutionary.

Even more amazing, the author wasn’t being satirical. He lists 12 specific reasons why he thinks Obama deserves high praise.

1. He is for The People. …2. He is for civil rights. …3. He is for one race – the human race. …4. He is for a healthcare system that brings hope and healing to the hurting. …5.  He is for the middle class. …6. He is for women’s rights. …7. He is for doing away with pomp and circumstance. …8. He is for the environment. …9. He is for veterans. …10. He is for peace. …11. He is for education. …12. He is for entertaining the masses.

If you click through and read the details, you’ll notice that the author almost never provides any details to back up his 12 reasons. He simply asserts that the President has good intentions.

Well, that probably true. But so what? I’m sure Jimmy Carter and Richard Nixon also had good intentions.

And when the author does provide details, they are very weak. Let’s look at a few specific claims.

We’re supposed to believe Obama “is for peace” because he was awarded a Nobel Prize immediately after taking office and before he did anything.

His actual record, for what it’s worth, has been to continue many of Bush’s policies and to pursue military intervention in Libya and Syria.

The author says Obama is “for the middle class,” yet that passage of the article doesn’t list a single policy, much less a specific accomplishment.

And there certainly wasn’t any effort to explain how an $8 trillion output gap and a seemingly permanent reduction in the employment-population ratio are good for ordinary people.

Moreover, if Obama “is for a healthcare system that brings hope and healing to the hurting,” then one might expect the author to reconcile that assertion with the fact that Obamacare is causing millions of people to lose their health insurance.

I’m also puzzled by the claim that the President “is for education.” This is the White House, after all, that was so intent on undermining opportunity for disadvantaged kids in Louisiana that even the Washington Post felt compelled to slam the Administration.

There’s no need to go through all 12 “reasons” before reaching the conclusion that there’s no way Obama deserves to be ranked anywhere near the top of the list for best Presidents.

And I’m not basing that on my own ideological preferences. If you want my opinion, Reagan and Coolidge are among the best (with an honorable mention for Bill Clinton) and FDR, Nixon, Wilson, and Hoover are near the bottom.

But even by non-ideological standards, it’s simply not credible to give Obama high marks.

P.S. If I had to guess, I suspect Obama would like to be another FDR. Fortunately, he won’t achieve that goal.

P.P.S. The assertion that Obama is “one of the best Presidents ever” is almost as silly as the claim that he is a conservative.

P.P.P.S. Since we’re comparing Presidents, I can’t resist sharing that the polling data showing that people would overwhelmingly vote for Reagan over Obama.

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There’s an off-year election today in the United States. There are no contests for the White House or Congress, but that doesn’t mean there aren’t any important choices being made.

I say that notwithstanding the fact that the big races between politicians at the state and local level aren’t expected to be close.

Governor Christie in New Jersey is poised for a landslide victory in his race for a second term. The only interesting aspect of this race is whether he will use his reelection as a springboard for a run at the White House in 2016. That may please you, depending on whether you focus on his rhetoric (here and here) or his record (here and here).

Bill de Blasio is going to be elected Mayor of New York City, replacing a politically correct Napoleonic busy-body (see here, here, here, here, and here) with a hard-left statist. I expect many productive people will be fleeing in the next few years. Given what will happen, I suspect Detroit-on-the-Hudson will be the future name of NYC.

Terry McAuliffe, a former Clinton fundraiser, will probably become Governor of Virginia. The GOP in the state has been dispirited and weak every since the corrupt Republican governor imposed a big tax hike, though the GOP candidate has a slight chance for an upset because of growing anti-Obamacare sentiment.

The contest that should command our attention is Amendment 66 in Colorado, a ballot initiative that would eliminate the state’s 4.63 percent flat tax and replace it with a so-called progressive tax regime with rates of 5 percent and 5.9 percent.

Here’s how the Wall Street Journal describes the proposal.

Colorado has veered to the political left in recent years, and on November 5 it may take another leap toward California. The Democrats and unions who now run state government are promoting a ballot initiative that would raise taxes and unleash a brave new era of liberal governance. …a $950 million revenue increase for politicians in the first year alone.

The real problem is what happens once the flat tax is gutted and politicians can play divide and conquer with the tax code.

…the real prize is down the road. Once a graduated tax code is in place, unions and Democrats will try again and again to raise tax rates on “the rich.” This has happened everywhere Democrats have run the show in the last decade, from Maryland to Connecticut, New York, Oregon and California. Within a decade, the top tax rate will be closer to 8% or 9%.  …that won’t make the state any more competitive in its interior U.S. neighborhood, where states like Kansas and Oklahoma are cutting tax rates. High-tax states created one net new job for every four in states without an income tax from 2002-2012, according to a study for the American Legislative Exchange Council.

So which side will win this vote?

As recently as 2011, Colorado voters voted down a state sales and income-tax increase, but the unions keep coming. And it’s no surprise they’ve already put $2 million behind Amendment 66. If it passes, they know they’ll get a big return on that political investment for decades to come. If it does pass, we’ll also know that millions of Coloradans have taken to smoking that marijuana they legalized last year.

Hmmm…that’s probably the strongest argument I’ve heard in favor of drug prohibition.

For what it’s worth, I’m predicting Colorado voters will reject this foolish class warfare scheme. Jerry Brown Promised LandThough I realize that may be a foolish guess. After all, 54 percent of crazy Oregon voters approved a tax hike in 2010 and their southern neighbors in the suicidal state of California voted by a similar margin for a class-warfare tax hike in 2012.

I’d feel a lot more confident, however, if we could replace Colorado’s voters with some sensible people from Switzerland. When faced with a class-warfare tax hike referendum in 2010, they voted against it by a very strong 58.5-41.5 margin.

And it was Swiss voters who overwhelmingly voted (84.7 percent) for the “debt brake” in 2001. And as I noted just yesterday, that de facto spending cap has been quite effective in controlling the burden of government spending.

Anyhow, if you know any Colorado voters, you may want to send them this video.

Regardless of how they vote, they should understand the potential consequences if Amendment 66 is approved.

P.S. Some Colorado voters just made a very sensible decision to defend the Second Amendment, but it’s unclear whether they have a similar attitude about economic liberty.

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The political elitists in Washington are worried that the American people are lukewarm – or even downright hostile – about Obamacare.

You can imagine two of them having a conversation, with the first saying, “Don’t these stupid peasants realize we’re giving them stuff?!?” and the second responding “We need the riff-raff in flyover country to feel grateful so they’re more likely to vote in favor of continued dependency!”

It never occurs to them that maybe, just maybe, people value freedom. Or, even if they don’t care about liberty, perhaps they object to the fact that government costs a lot and delivers very little. Nobody likes paying for a steak and getting a hamburger, after all.

But the statists think it’s just a matter of messaging, and this mindset is even seen in news coverage.

Here’s some of what Politico wrote today.

Obamacare MessagingThe Obama administration and its health-law allies are gearing up this summer to slice through three years of confusion and opposition to Obamacare. They’ve got their work cut out for them. Obamacare won’t have a shot at success unless millions of people sign up for insurance — the healthy as well as the sick. …Organizing for Action, spun off from President Barack Obama’s campaign operation, went up with a seven-figure TV ad buy in June, touting the new benefits and promising to offer “the truth” about the law. Enroll America, a nonprofit group with ties to the White House, wants to leverage the grass roots across the country and engage big-name celebrities for the cause.

To put it mildly, they have their work cut out for them.

Thanks to absurd regulations and mandates that prevent the insurance market from working properly, young people and healthy people will have to pay far more than the market rate to obtain insurance.

Needless to say, not that many people will be dumb enough to take that deal, regardless of how many empty-headed Hollywood millionaires take part in a PR campaign telling them it’s the “cool” thing to do.

Especially when another brainless part of Obamacare basically allows people to wait until they get sick and then get insurance. If you’re wondering how that will work, just imagine how auto insurance would work if you could wait until after your DUI accident to get a policy – and you got subsidized by all the responsible drivers!

Obamacare defenders may delude themselves into believing that the mandate will work, but the penalty for noncompliance (oops, apologies Chief Justice Roberts, I meant the “tax” for noncompliance) is a lot less than the cost of an insurance policy.

And I don’t think the American people will be pleased when the army of new IRS agents starts harassing them to sign up for a bad deal.

It’s almost enough to make me feel sorry for the hacks at OFA and elsewhere who are trying to sell this lemon.

Simply stated, it doesn’t matter how much lipstick you put on a pig.

Let’s close with some amusing Obamacare cartoons, starting with one by Bob Gorrell which sort of shows how the IRS will enforce the new law.

Obamacare Cartoon 7

By the way, my favorite IRS-related Obamacare cartoon can be seen here.

Here’s a good cartoon by Steve Breen about the cost of the new law.

Obamacare cartoon 8

For what it’s worth, some of us were predicting runaway costs even before the legislation was enacted.

Let’s finish with this amusing cartoon by Gary Varvel. Technically speaking, Nancy Pelosi was right.

Obamacare Cartoon 9

Though I imagine she thinks we just need some clever messaging so we understand why it’s okay that bad things are happening to children, retirees, and low-income workers.

Let’s conclude with some optimism. Click here to read my six-part hypothesis on why this bad law can be repealed.

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I’m currently in Paris for my final stop on the Free Market Road Show. In other words, I’m in the belly of the beast of big-government statism.

So you would think I might be depressed, but I’m actually in a good mood.

Not because I’m surrounded by millions of socialists, but because voters in my home state just punished a couple of entrenched incumbent Republican politicians who sided with special interest groups and voted to rape and pillage taxpayers.

Here are some bring-a-smile-to-your-face details from a Washington Post report.

Two 20-year veterans of Virginia’s House of Delegates lost their seats Tuesday, falling to GOP primary challengers who assailed their support for a tax-heavy transportation funding overhaul. Del. Joe T. May (Loudoun) and Del. Beverly J. Sherwood (Frederick) lost to political newcomers who railed against the transportation plan, which imposes a $1.2-billion-a-year tax increase. … No sitting Republican delegate had faced a primary challenge since 2005, when activists went after some of those who supported a $1.5-billion-a-year tax hike pushed by then-Gov. Mark Warner (D).

You probably won’t be surprised to learn that these Republican-in-name-only lawmakers claimed tax hikes were necessary because there was no room to cut spending.

But the real problem is that too many Republicans in Richmond decided that the cesspool of big government was actually a hot tub. So rather than drain the swamp (yes, I’m mixing my metaphors), they decided they wanted more money to waste.

So, over the past several years, the burden of spending rose. Not just rose. It climbed twice as fast as inflation.

But they needed more money to maintain and support bigger government. So they disregarded their anti-tax promises.

And two of them paid the price at the polls. That may not sound like much since 34 GOP lawmakers sided with the left and voted for the tax hike.

But remember that it’s very hard to defeat incumbent politicians. So when a pair of 20-year incumbents lose, you can be sure that other lawmakers now will be far less likely to side with the political class instead of the people back home.

By the way, what makes the story in Virginia so pathetic is that Republicans normally get seduced into tax increases because of stupidity. As the Charlie Brown parody indicates, they get tricked into believing higher revenues will be used to lower deficits.

But in this case, the RINO Republicans openly admitted that they wanted more revenue to expand the state budget.

Heck, they didn’t just deserve to lose. They should have been tarred-and-feathered.

The no-tax-hike position is a line in the sand that shouldn’t be crossed.

The starve-the-beast rejection of tax hikes isn’t a sufficient condition to control big government, but it darn sure is a necessary condition.

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Even though Barack Obama unintentionally is doing a good job of recruiting more people to the libertarian philosophy, that doesn’t mean I’m optimistic that we will achieve libertarian Nirvana in my lifetime.

Libertarian Man of the Year?

I’m even willing to admit that part of the problem is that libertarians (like me!) tend to be a strange breed and we occasionally rub people the wrong way. Needless to say, this sometimes makes it difficult to gain new converts.

So when people say libertarianism is unrealistic, that may be an accurate political prediction. I can respond by pointing out reasons why I think it’s possible to reduce the burden of government and make people more free, but there’s no doubt that it’s difficult to make substantial progress against the combined forces of bureaucrats, politicians, lobbyists, interest groups, and dependents.

That being said, there are some arguments against libertarianism that are very weak. Consider what Michael Lind just wrote for Salon.

Why are there no libertarian countries? If libertarians are correct in claiming that they understand how best to organize a modern society, how is it that not a single country in the world in the early twenty-first century is organized along libertarian lines? …If socialism is discredited by the failure of communist regimes in the real world, why isn’t libertarianism discredited by the absence of any libertarian regimes in the real world? Communism was tried and failed. Libertarianism has never even been tried on the scale of a modern nation-state, even a small one, anywhere in the world.

Lind actually answers his own challenge by noting that libertarians point to the superior performance of nations that are more free than others.

I’ve done that myself by comparing the United States with the European Union. Or Chile with Argentina and Venezuela. Or South Korea and North Korea. Or Singapore and Hong Kong with the United States.

Anyhow, you get the point.

But Lind would like readers to think it’s somehow illegitimate to judge libertarianism by comparing libertarian-leaning nations with statist-leaning nations.

But he doesn’t offer any legitimate rationale for this restriction. Why do we need a perfect libertarian society to make judgements about libertarianism, any more than we need pure socialism or communism to draw conclusions about those statist societies?

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Among the right-leaning policy wonks and intellectuals in Washington, there’s a lot of attention being given to the something called “reform conservatism.”

Underlying this school of thought is the notion that the Reagan-era message no longer works since Republicans have lost the popular vote in five out of the last six elections.

A few people have asked my opinion about this movement, and since Ross Douthat of the New York Times just put together a good description of this school of thought, it makes it easy for me to offer my thoughts.

But before digging into his column, I think that some of the angst on the right is misplaced. Why blame a Reagan-era message for GOP electoral problems when all the Republicans presidential nominees in recent years have favored big government? Does anybody really think that Bush 41, Dole, Bush 43, McCain, and Romney were Reaganites?!?

Could any of those candidates have given these remarks, at least with any credibility? Or made these comments in a sincere fashion? It’s much more plausible to say that Republicans have lagged because they didn’t have candidates with a Reagan-style message.

But let’s assume, for the sake of argument, that Republicans would have fared poorly even if Reaganites had been nominated. Does “reform conservatism” offer a path to electoral salvation.

Here’s what Douthat identifies as the “two major premises” of reform conservatism.

1. First, he writes that the “core economic challenge facing the American experiment is not income inequality per se, but rather stratification and stagnation — weak mobility from the bottom of the income ladder and wage stagnation for the middle class.” Conservatives, he says, should strive to make “family life more affordable, upward mobility more likely, and employment easier to find.”

2. Second, he warns that the “existing welfare-state institutions we’ve inherited from the New Deal and the Great Society, however, often make these tasks harder rather than easier: Their exploding costs crowd out every other form of spending, require middle class tax increases and threaten to drag on economic growth.”

I’m not an expert on income mobility, so I’m not sure I would identify stratification and stagnation as the nation’s core economic challenge, but he may be right. Regardless, it’s definitely a good idea to have more mobility.

And I definitely agree that the welfare state hinders upward mobility by creating dependency. And he’s right that this is a drag on growth. That being said, I disagree with his assertion that rising entitlement expenditures crowd out other spending and lead to middle class tax hikes. Those things may happen at some point, particularly once we get into the peak years for retiring baby boomers, but they haven’t happened yet.

The more important question, at least to me, is what sort of policies do reform conservatives embrace? Here’s Douthat’s list, bolded, followed by my thoughts.

a. A tax reform that caps deductions and lowers rates, but also reduces the burden on working parents and the lower middle class, whether through an expanded child tax credit or some other means of reducing payroll tax liability. Tax Distribution CBOI obviously like the idea of lowering rates and reducing deductions since that moves the system closer to a flat tax. That being said, it’s difficult to reduce the tax burden on the lower middle class since they pay very little income tax under the current system (see accompanying table from CBO). But I like the idea of addressing the payroll tax, though I disagree with their approach (see section “c” below).

b. A repeal or revision of Obamacare that aims to ease us toward a system of near-universal catastrophic health insurance, and includes some kind of flat tax credit or voucher explicitly designed for that purpose. I fully agree with repeal of Obamacare, and I think an unfettered marketplace would evolve into a system of near-universal catastrophic insurance, but I don’t want the federal government subsidizing or coercing that approach (though current healthcare policy has far more subsidies and coercion, so Douthat’s plan would be a big improvement over the status quo).

c. A Medicare reform along the lines of the Wyden-Ryan premium support proposal, and a Social Security reform focused on means testing and extending work lives rather than a renewed push for private accounts. I’m glad they embrace Medicare reform, but I’m puzzled by the hostility to personal retirement accounts.  If you increase the retirement age and/or means test, you force people to pay more and get less, yet Social Security already is a bad deal for younger workers. So why make it worse? How can that be good for those with low mobility? Personal accounts would be akin to a tax cut for such workers since the payroll tax would be transformed into something much closer to deferred compensation.

d. An immigration reform that tilts much more toward Canadian-style recruitment of high-skilled workers, and that doesn’t necessarily seek to accelerate the pace of low-skilled immigration. As I noted in this interview, I very much favor bringing more high-skilled people into the country.

e. A “market monetarist” monetary policy as an alternative both to further fiscal stimulus and to the tight money/fiscal austerity combination advanced by many Republicans today. I try to avoid monetary policy. That being said, I’m a bit skeptical of “market monetarism.” No nation has ever tried this system, so it’s uncharted territory, and I’m reluctant to embrace an approach which is premised on the notion that bubbles can’t exist (what about the tech bubble of the late 1990s or the housing bubble last decade?!?). I’m also suspicious of a system which requires an activist central bank. Watch this George Selgin video if you want to know why.

f. An attack not only on explicit subsidies for powerful incumbents (farm subsidies, etc.) but also other protections and implicit guarantees, in arenas ranging from copyright law to the problem of “Too Big To Fail.” Amen. I fully agree.

Since I’m a tax policy wonk, let me address in greater detail some of the tax reform proposals put forward by reform conservatives.

Jim Pethokoukis of the American Enterprise Institute is identified in the column as a reform conservative, and he recently expressed skepticism about the flat tax in a column for National Review.

It’s an elegant, compelling model that might work  splendidly if you were creating a tax code ex nihilo. …America, however, is in a much different place. Millions of individuals and businesses have made long-term plans based on expectations that the tax code will remain more or less the same. Half the nation, thanks to all those deductions and credits, pays no income tax. …it’s unlikely the U.S. can keep spending down at historical levels of 20 percent to 21 percent of GDP while also maintaining a floor for defense spending at 4 percent of output. The best a group of AEI scholars could manage was limiting spending to 23 percent of GDP by 2035.

The clear implication of his column is that we need a tax system that raises more revenue. I obviously disagree. We should never “feed the beast” by giving politicians more money to spend.

Pethokoukis also says the flat tax is politically unrealistic. Since I’m not expecting a flat tax in my lifetime, I obviously can’t argue with that statement. But he then proposes another plan that would be far less popular – and far more dangerous.

One solution is to take the essentially flat consumption tax devised by economists Robert Hall and Alvin Rabushka and give it a progressive rate structure. Or we could combine a consumption tax with a flat income tax on wealthier Americans, as suggested by Yale’s Michael Graetz.

So we should keep the income tax as a vehicle for class warfare and augment it with a VAT?!? Yeah, good luck trying to sell that idea. And Heaven help us if it ever succeeded since politicians would have another major source of tax revenue.

Another plan, which Douthat explicitly cites in his paper, was put together by Robert Stein, a former Bush Treasury official. He thinks traditional supply-side policies today are either irrelevant or unpopular.

Lowering tax rates today could still enhance the incentives to invest, particularly in the corporate sector. But the distortions caused by marginal tax rates are not nearly as great as they were in 1980. And attempts to solve other problems caused by the tax code itself — like the biases in favor of consumption over saving, or home building over business investment — could never in themselves garner the public support necessary for a major overhaul.

As I noted, I’m not holding my breath for a flat tax, so I can’t disagree with Stein’s prognostication.

He also has a very novel way of defining the problem we should be trying to fix.

…it is time to rethink how the tax code treats ­parents. …raising children is hardly just another pastime: It is one of the most important services any American can perform for our country. …even as Social Security and Medicare depend on large numbers of future workers, they have created an enormous fiscal bias against procreation, undermining an important motive for raising children: to safeguard against poverty in old age. ……our system of taxes and entitlements not only fails to reward parents — it actively discourages Americans from having children. …Recent studies (especially work by Michele Boldrin, ­Mariacristina De Nardi, and Larry Jones and by Isaac Ehrlich and Jinyoung Kim) show that Social Security and Medicare actually reduce the fertility rate by about 0.5 children per woman. In European countries, where retirement systems are larger, the effect is closer to one child per woman.

As a libertarian, the beginning section of that passage grated on me. My children are individuals, not a “service” to prop up entitlement programs. I agree with Stein that these programs are a problem, but the solution is to reform entitlements, not to rejigger the tax code in hopes of pumping out more taxpayers.

Stein disagrees.

Unfortunately, these negative effects on fertility cannot be cured simply by converting old-age entitlement programs into mandatory savings programs, as the Bush administration proposed for Social Security in 2005. After all, requiring workers to save for retirement through private financial instruments would also crowd out the traditional motive to raise kids.

Instead, he wants to change the tax system based on the notion that today’s kids are tomorrow’s taxpayers.

…the present value of future Social Security and Medicare contributions for a typical worker born today is about $150,000. Rewarding parents for creating these future contributions suggests annual tax relief of about $8,500 per child. To correct for this inadequate treatment of households with ­children, the existing dependent exemption for children, the child credit, the ­child-care credit, and the adoption credit should be replaced with one new $4,000 credit per child that can be used to offset both income and payroll taxes. (This amount is set much closer to the $3,250 figure than the $8,500 one mostly to reduce the plan’s negative impact on federal revenue.)

I have no philosophical objection to some form of exemption – or even credit – based on family size. Almost all flat tax systems, for instance, have some sort of family allowance.

But it’s also important to realize that bigger family allowances generally don’t have pro-growth effects. It’s the marginal tax rate that impacts incentives.

And Stein, unfortunately, would “pay” for his credits by raising marginal tax rates on a significant share of taxpayers.

Some of these costs would be offset by eliminating itemized deductions (other than mortgage interest and charitable contributions). The rest would have to be offset by ­allowing the top rate of 35% to touch more taxpayers than it currently affects. …who pays more? Primarily high-income workers, but also upper-middle-class taxpayers who do not have children in the home (either because they have decided not to raise children at all, or because their children have already turned 18). To be blunt, the plan is a tax hike on the rich and makes the tax code even more progressive than it is today.

To be fair, Stein also proposes some good policies such as AMT repeal and reductions in double taxation, so he’s definitely not in the Obama class-warfare camp. But it’s also fair to say that his plan won’t do much for growth. Some tax rates are lowered but others are increased.

Yet if you really want families to be in stronger shape, more growth is the only long-run solution.

Moreover, it’s not clear that Stein’s agenda would be terribly popular. Though I confess that’s just a guess since no politician has latched onto the idea in the years since the proposal was unveiled.

Returning to the broader issue of “reform conservatism,” it’s difficult to assign an overall grade to the movement since I’m not sure whether we’re supposed to interpret it as a political strategy or an economic plan.

Regardless, I guess I’m generally sympathetic. I assume the RCers want government to be smaller than it is today and I don’t think you have to be a 100 percent libertarian to be my ally in the fight to restrain excessive government. And I also think it’s a good idea for people to be thinking of how to best articulate a message of smaller government. Heck, I do that every time I go on TV or give a speech.

So I reserve the right to object to any of the specific proposals that reform conservatives put forward (such as the tax plans discussed above), but I like the project.

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Barack Obama has stated that he wants to be like Reagan, at least in the sense of wanting to be a transformational figure.

But almost certainly he has failed.

Yes, Obama has increased the burden of government spending, raised tax rates, and created more dependency, but there’s nothing particularly special about Obama’s tenure that makes him different from other statist Presidents such as Nixon, Carter, and Bush.

Nor is there any evidence that he has fundamentally changed the attitudes of the American people.

That may sound like a bold – and overly optimistic – assertion, but check out the amazing results from a new poll. According to a survey of 1,000 adults, Reagan would kick the you-know-what out of Obama, winning a hypothetical contest by a staggering 58-42 margin.

Reagan Obama Poll

By the way, the margin might be even bigger than I’m reporting. As you can see from this press excerpt, all we know is that 58 percent of respondents said they would vote for Reagan. I’m assuming that 42 percent would vote for Obama, but it’s possible there was also a “don’t know” or “other” category, so maybe Obama would be under 40 percent!

…just about everything about the era — from the politics, leaders and safety to the music, TV shows and blockbuster movies — are seen as being better than they are today. In fact, 3 in 4 Americans (74%) thought that our country was better off then and even safer (76%). The same amount (76%) believe that government ran better in the 1980s than it does today. And if a presidential election were held today, 58 percent would vote for Ronald Reagan over Barack Obama. Americans ages 18 to 34 were evenly split, with 51 percent favoring Reagan and 49 percent Obama.

Even young people preferred Reagan over Obama, which is remarkable since they didn’t experience the Reagan years and largely have learned about the Gipper from the media and schools, both of which are very hostile to Reagan.

We shouldn’t be too surprised by these polling results. Just take a look at this amazing infographic, which shows Obama’s horrible record on jobs compared to Reagan and other Presidents. Michael Ramirez makes the same point in this very funny cartoon.

Or look at these powerful charts based on Minneapolis Federal Reserve data, which compare the strong results of Reaganomics with the pathetic results of Obamanomics.

In other words, good policy leads to good outcomes, and good outcomes yield political rewards. That simple lesson has been lost on the weak gaggle of big-government GOPers who followed Reagan.

But our hypothetical polling results show that Americans today are still ready to rally behind a candidate who offers a compelling message of freedom and prosperity. That’s yet another reason why I’m still optimistic about the fight for liberty.

P.S. Here’s some snarky humor comparing the Gipper with Obama. And if you liked the story of what happens when you try socialism in the classroom, you’ll also enjoy this video of Reagan schooling Obama.

P.P.S. If you want to be inspired, click here and here to see two short clips of Reagan in action.

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Even though I’m a staunch libertarian, I’m not under any illusion that everyone is open to our ideas. Particularly since, as I wrote a couple of weeks ago, we get falsely stereotyped as being heartless, hedonistic, anti-social, and naively isolationist.

That’s why I’m willing to accept incremental reforms. Compared to my libertarian dream world, for instance, the entitlement reforms in the Ryan budget are very modest. But they may be the most we can achieve in the short run, so I don’t make the perfect the enemy of the good.

But I do make the bad the enemy of the good. Politicians who expand the size and scope of government get on my wrong side, regardless of whether they are Republicans or Democrats.

Which explains why I haven’t approved of any Republican presidential candidate since Ronald Reagan.

With this in mind, you can imagine my shock when I read Robert Patterson’s recent column that blames recent GOP presidential woes on…you guessed it, “far-right libertarians.”

…in the political big leagues, …the GOP strikes out with the popular vote in five of the past six presidential elections… That familiar lineup shares one big liability: libertarian economics, which has been undermining the Republican brand… That message represents the heart and soul of a party that started sleeping with far-right libertarians in 1990. …In the libertarian universe, “economic freedom” trumps everything: civilization, nation, statecraft, patriotism, industry, culture and family. This “economic freedom,” however, diverges greatly from the liberty that transformed the United States into an industrial, financial and military colossus.

What the [expletive deleted]!

Let’s go down the list of  recent GOP presidential candidates and assess whether they were captured by “far-right libertarians” and their dangerous philosophy of “economic freedom.”

  • George H.W. Bush – He increased spending, raised tax rates, and imposed costly new regulations. If that’s libertarian, I’d hate to see how Patterson defines statism.
  • Do you see any libertarians? Me neither.

    Robert Dole – All you need to know is that he described his three proudest accomplishments as the creation of the food stamp program, the imposition of the costly Americans with Disabilities Act, and the Social Security bailout. I don’t see anything on that list that’s remotely libertarian.

  • George W. Bush – I’ve written several times about Bush’s depressing record of statism. Yes, we got some lower tax rates, but that policy was easily offset by new spending, new intervention, new regulation, and bailouts. No wonder economic freedom declined significantly during his tenure. Not exactly a libertarian track record.
  • No libertarians here, either

    John McCain – His track record on spending is somewhat admirable, but he was far from libertarian on key issues such as tax rates, global warming, bailouts, and healthcare.

  • Mitt Romney – He was sympathetic to a VAT. He criticized personal retirement accounts. He supported corrupt ethanol subsidies. And he said nice things about the TARP bailout. And I don’t need to remind anybody about Obamacare’s evil twin. Is that a libertarian agenda?

I also disagree with several of the policies that Patterson advocates, such as protectionism and industrial subsidies.

But that’s not the purpose of this post. Libertarians already face an uphill battle. The last thing we need is to be linked to a bunch of big-government Republicans when we share almost nothing in common on economic policy.

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Even though it changed the terms of the political debate, thus giving them a majority in the 2010 elections, many in the Republican establishment deeply resent the Tea Party. They don’t like being monitored by taxpayer-friendly groups that will expose them when they side with special interests (as they have in recent months on Export-Import Bank subsides and housing handouts).

And they really hate the idea of being held accountable at the polls when they side with the corrupt big-spenders in Washington. Just ask Senator Bennett and Congressman Inglis.

Pork...or principles?

Pork…or principles?

Now the Washington establishment is fighting back. Karl Rove, best known for helping to steer the Bush Administration in favor of statist policies that led to the disastrous elections of 2006 and 2008, even has created a PAC to oppose the Tea Party.

But this seems like a very childish and self-destructive approach. According to some scholarly research, the Tea Party has made a big difference, both in terms of generating more votes for the GOP and in terms of pressuring Republicans to side more with taxpayers rather than the inside-the-beltway interest groups.

Here are some intriguing details from the new academic study.

We use data from a large number of sources to measure the influence of the Tax Day protests on the Tea Party. …We show that these political protests and the movements they built affected policymaking and voting behavior as well. Incumbent representatives vote more conservatively following large protests in their district… Larger protests increase turnout in the 2010 elections, primarily favoring Republican candidates. We find evidence of sizable effects. In particular, our baseline estimate shows that every Tea Party protester corresponds to a 14 vote increase in the number of Republican votes. Our most conservative estimate lowers that number to 7. The Tea Party protests therefore seem to cause a shift to the right in terms of policymaking, both directly and through the selection of politicians in elections.

Seems like a GOP political consultant should be very pleased with this research (assuming, of course, that they’re motivated by Republican and conservative victories rather than their own influence and contracts).

Want some more evidence that the Tea Party has made a difference? Well, check out these excerpts from a story in The Atlantic complaining about the lack of action in the Senate and ask yourself whether the addition of Senators like Rand Paul, Mike Lee, Marco Rubio, Ron Johnson, and Pat Toomey might be one of the reasons why Obama’s agenda has been stalemated.

Here’s an impressive fact about life in today’s Washington: The last time a major new piece of policy legislation passed the U.S. Senate was July 15, 2010. That’s when the Dodd-Frank financial-reform bill came through the Senate. And it was 951 days ago. If you’re wondering whether President Obama’s ambitious second-term agenda has a chance to make it through Congress, this little fact might be worth keeping in mind. …the Senate…hasn’t done anything the president could add to his list of policy accomplishments. For that — the kind of thing a president might talk about in his campaign speeches — it’s been more than two and a half years.

It’s now been more than 951 days, and let’s be thankful with every passing second. A “do-nothing” Congress is a very good thing if the only other option is to pass monstrosities such as Obamacare and Keynesian spending schemes.

Keep in mind, by the way, that there are now more Tea Party-oriented Senators such as Tim Scott, Ted Cruz, and Jeff Flake.

To conclude, I’m not under any illusion that the Tea Party automatically means better politicians and/or better election results. But every advocate of tax reform and smaller government should be very happy that there are people in the country who are pressuring politicians to adhere to libertarian-ish principles rather than playing the corrupt Washington game.

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This is an easy question and a hard question.

It’s an easy question because the obvious answer is to say “none-of-the-above.”

After all, voters in Italy have four horrible choices.

  1. Silvio Berlusconi, who is an Italian version of George W. Bush. He’ll occasionally dish out some good rhetoric and promise tax relief, but he’s shown zero desire to reduce the burden of government spending and intervention.
  2. Mario Monti, an apparatchik who is first and foremost a creature of the calcified bureaucracy in Brussels. He would be a sober hand on the helm, but seems content that the ship is heading in the wrong direction. He’s sort of the Mitt Romney of Italy.
  3. Beppe Grillo, a comedian/entertainer/blogger who has a populist (albeit incoherent) agenda. He’s a strange cross of Jesse Ventura, Arnold Schwarzenegger, Ross Perot, and Bernie Sanders, so don’t even think about that petri dish.
  4. Pier Luigi Bersani, a run-of-the-mill social democrat who started his political life in the Communist Party but now is best described as a career politician who wants to preserve the status quo of statism. Sort of the Harry Reid of Italy.

So far as I’m aware, there is no good political party in Italy. Classical liberals, conservatives, and libertarians seem to be endangered species. That’s why I answered none-of-the-above.

But what if my kids were being held hostage and I had to choose from this unpalatable quartet?

Go ahead and shoot them…no, just kidding. Let’s see, what should I do…?

Italian Election PollPart of me wants to cheer for a Bersani-Monti coalition government for the same reason that I wanted Hollande to win in France. When there’s no good alternative, let the above-board statists prevail so there’s hope of a backlash when things fall apart.

And if the polling data is accurate, that’s probably going to happen.

But part of me wants Grillo to do well just for the entertainment value. And maybe he would blow up the current system, which unquestionably has failed, though one wonders whether any system will work now that a majority of Italians are riding in the wagon of government dependency.

Indeed, it’s a bit of serendipity that a former Cato intern who came from Italy drew this famous set of cartoons about the rise and fall of the welfare state.

While I’m largely uncertain about what should happen in this election, let me close with a few thoughts on public policy in Italy. In particular, I want to disagree with some of my right-leaning friends who argue that the euro should be blamed for Italy’s woes.

I’m not a fan of the single currency, largely because it is part of the overall euro-federalist campaign to create a Brussels-based superstate.

That being said, the euro has been a good thing for Italy and other Club Med nations. As I explained last July, it means that countries such as Italy, Spain, and Greece can’t augment the damage of bad fiscal and regulatory policy with inflationary monetary policy.

In other words, it is good news that Italy can’t use inflation as a temporary narcotic to offset the pain caused by too much red tape and an excessive burden of government spending.

This doesn’t mean that politicians will ever choose the right approach of free markets and small government, but at least there’s a 2 percent chance of that happening if they stay with the euro. If Italy goes back to the lira, the odds of good reform drop to .00003 percent.

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I’m a huge fan of so-called tax havens. I’ve been working for more than 10 years to protect and promote the values of tax competition, fiscal sovereignty, and financial privacy.

The bureaucrats at the OECD even threatened to have me tossed in a Mexican jail because I was advising representatives of low-tax jurisdictions on how best to resist fiscal imperialism.

Why am I fighting this battle and taking occasional risks? Because tax havens are a huge plus for the global economy.

Statist politicians, not surprisingly, resent and despise tax havens. They often attack these low-tax jurisdictions because they don’t want limits and constraints on their ability to increase taxes and spending. They want taxpayers to be “captive customers” who can be fleeced without any options to escape.

But statist politicians often are hypocrites. I’ve already written about lawmakers such as John Kerry, Bill Clinton, John Edwards, and others on the left who have utilized tax havens to boost their own personal finances.

“Our motto is ‘do as I say, not as I do'”

Now President Obama has nominated another one of these hypocrites to be Secretary of the Treasury, and this is generating a bit of controversy. Here’s some of what the Washington Post has reported.

Treasury secretary nominee Jack Lew will face questions at his confirmation hearing next week about an investment fund registered in a Cayman Islands building that has been called a notorious site for tax haven abuse. Lew held between $50,000 and $100,000 in the fund… The investment fund could become an issue during the upcoming hearing because Lew’s job as Treasury secretary would give him a major role in shaping the administration’s tax policy. The president has targeted tax haven abuse as a major problem in the country’s tax system. Sen. Charles E. Grassley (R-Iowa), a senior member of the committee, vowed to ask Lew about the Citigroup investment. “President Obama has been almost obsessively critical of offshore investments,” Grassley said in a statement Friday. “That makes this Cayman Islands investment of his top official and now Treasury secretary nominee worthy of attention. The irony is thick.”

The irony is doubly thick because we recently finished a presidential campaign where the President’s campaign viciously attacked Mitt Romney for doing exactly the same thing as Jack Lew. And now the White House is pointing out the same thing I pointed out about Romney – that there is nothing illegal, immoral, or unethical about investing in a place that has good tax laws and good governance.

“Jack Lew paid all of his taxes and reported all of the income, gains and losses from the investment on his tax returns,” White House spokesman Eric Schultz said. “He played no role in creating, managing or operating the fund, and he sold his investment in 2010 at a net loss.” …The address for the Citigroup fund is a building in the Cayman Islands known as the Ugland House, which President Obama singled out in a 2009 speech railing against tax haven abuse. “Either this is the largest building in the world or the largest tax scam in the world,” Obama said.

Not surprisingly, the media is remarkably quiet about Lew’s investments,even though they were very curious about how Mitt Romney was investing his money.

Ugland House: Approved for leftists

It’s also worth noting that the irony is triply (is that even a word?) thick since Lew invested in a fund based at Ugland House.

What’s Ugland House?

Well, you’ll notice in this video that a certain presidential candidate referenced Ugland House back in 2008.

And Democratic Senators also have launched big attacks on Ugland House.

But anybody want to place any bets on whether that will matter when it comes time to vote on Lew’s nomination?

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Since I routinely spread a message of doom and gloom about the ever-expanding welfare state and warn about the potential for European-style fiscal collapse, I guess I shouldn’t be surprised that I’ve received several emails asking me variants of this question: “Do you think the United States can be rescued?”

Or sometimes, I get questions that I think are somewhat related, such as “Doesn’t Washington drive you crazy” or “Why haven’t you given up?”

I’m not sure I’m good at introspection, but I’ll try to answer, and we’ll start with the main question and then deal with the secondary queries.

To be blunt, if I had to place a bet on the outcome, I think the United States will become a failed European-style welfare state. The burden of government spending already is far too high and our long-run outlook is terrible, as shown by these OECD and BIS numbers, and I don’t think the callow politicians in Washington will fix the problems because they rarely think past the next election cycle.

This doesn’t necessarily mean that we’ll have a Greek-style fiscal collapse. Perhaps we’ll simply descend into permanent stagnation, with anemic growth (at best) and widespread dependency and joblessness.

That being said, even though I would bet on a bad outcome, I think there’s a genuine opportunity to save the country.

My job: Putting my finger in the dyke, trying to hold back the flood of big government

No, I’m not talking about creating a libertarian Nirvana, with the federal government consuming only three percent of economic output. But I think we can at least hold the line and prevent government from becoming bigger than it is today. Sort of a watered-down version of Mitchell’s Golden Rule.

The key is the right kind of entitlement reform. Our long-run fiscal nightmare is entirely the result of programs such as Social Security, Medicare, and Medicaid, so the solution is obvious.

But is it achievable?

As I’ve already indicated, I wouldn’t bet on it. We definitely know there won’t be any good reforms for the next four years, but let me give you a plausible scenario for what might happen beginning in 2017.

We’ll start with the fact that the House of Representatives already voted for Medicaid reform and Medicare reform as part of the Ryan budget in 2011 and 2012. We also know that Republicans retained the House in the most recent election and there seems to be a political consensus that voting to fix the healthcare entitlements was not a political liability.

There was no Social Security reform in Ryan’s budget, but we also know that George W. Bush (for all his other faults) supported personal accounts in 2000 and 2004 and didn’t suffer any political backlash. Indeed, personal accounts still seem to be reasonably popular.

With this in mind, I think it may be possible to fix entitlement programs in 2017 assuming that the 2014 and 2016 elections lead to pro-reform lawmakers in the House, Senate, and White House.

That may not be likely, but it’s definitely possible.

My job, simply stated, is to help inform and educate people so that the climate is favorable to reform.

Which brings me to the secondary questions about whether Washington drives me crazy and whether I should give up.

The short answer is that I’m intellectually pessimistic but operationally optimistic.

In other words, my brain tells me that things will probably deteriorate but my heart tells me that this is a battle worth fighting.

So, yes, Washington does drive me crazy. It is both an immoral town and an amoral town, pervasively corrupt and filled with people who seem to think that it is perfectly okay to steal so long as it happens through the legislative or regulatory process.

And, yes, I may decide to give up if something really horrible happens, such as adoption of a value-added tax. Giving politicians a big new source of revenue, after all, would cripple any incentive for fiscal restraint.

But until that happens, I think I’m very lucky that I get to wake up every day and be part of the Cato Institute’s fight to preserve (and restore) American exceptionalism.

P.S. This is the second “Question of the Week” in two days, but I neglected to answer a question last week, so I had to catch up and get back on track. Yesterday’s question and answer generated a lot of interest, so I hope this one is equally thought-provoking.

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I get several emails per week asking my view on various topics and many of the questions raise very interesting issues.

So I’ve decided to start a new feature. Every weekend, I will endeavor to answer one question.

My first chore is to explain why I hate Republicans, and as you can see here and here, there’s certainly ample reason to think I hold GOPers in low esteem.  The actual question, though, is:

You seem to be more critical of Republicans than Democrats and you went out of your way to attack Romney. Doesn’t that play into the hands of Obama?

The answer is yes and no. I don’t mean to sound like a politician, but I view my job as providing nonpartisan analysis on public policy issues. That means I criticize the statist schemes of the folks in Washington, regardless of whether the politicians have a “D” or an “R” at the end of their names.

To be fair, I’m probably a bit harder on Republicans, but only because they’re the ones who often pretend that they are on my side.

And sometimes they are on my side. My two favorite presidents are Reagan and Coolidge, and I have great admiration for those few politicians – such as Ron Paul – who almost always do the right thing.

But I also have discovered that bad Republicans usually do more damage than Democrats. Nixon was one of the most statist presidents of my lifetime, and Bush 41 and Bush 43 were almost as bad.

And even the politicians I’m willing to praise, including Ron Paul, sometimes do the wrong thing. And as much as I praise Reagan, he had some huge mistakes, such as the catastrophic health insurance program.

My simple rule of thumb is I will support a politicians who, in my estimation, will be a net plus for liberty. So notwithstanding my reputation for being a libertarian ideologue, I have a very practical approach to politics.

That’s the good news. The bad news is that it’s rather disappointing that so few Republicans satisfy that simple test.

But now let’s return to the question. Doesn’t that view play into the hands of Obama? As I said, yes and no

“Hey, you libertarians should vote for me”

I want to maximize liberty (or minimize statism) in the long run. So if I have a choice between a big-government Republican and big-government Democrat, I sometimes think we’re better off if the Democrat prevails.

Jimmy Carter, for instance, probably wasn’t that much worse than Gerald Ford. And he paved the way for Reagan.

And Bill Clinton, in retrospect, was a much better choice than Bush 41. And he paved the way for the GOP landslide in 1994.

So the question before us today is whether Barack Obama is paving the way for a good Republican…or whether he’s a Lyndon Johnson paving the way for a Richard Nixon.

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Welcome to Paul Krugman’s readers. I invite you to read my response.

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I was surprised when the people of Oregon voted for a tax increase back in early 2010.

Yes, I realize that the politicians and interest groups structured the measure so that the majority of voters would be unaffected. It was basically a class-warfare proposal, with a small fraction of the population being targeted to generate (at least in theory) a bunch of revenue that could be used to maintain a bloated and over-compensated state bureaucracy.

But I was nonetheless surprised because I figured voters would realize that upper-income taxpayers aren’t fatted calves idly awaiting slaughter. They can easily move to other states (particularly nearby zero-income tax states such as Washington and Nevada).

In other words, I thought Oregon voters understood that you shouldn’t drive away the geese that lay the golden eggs. A state isn’t like the old Soviet Empire, with an “Iron Curtain” of watchtowers and guard dogs to keep a population under control.

I was wrong about Oregon, so I shouldn’t be too surprised that California voters basically just made the same mistake.

Yesterday, the looters and moochers of the Golden State voted for Prop 30, a measure to significantly boost both the state sales tax and also hike income tax rates on investors, entrepreneurs, and small business owners.

I’m generally reluctant to make predictions, but I feel safe in stating that this measure is going to accelerate California’s economic decline. Some successful taxpayers are going to tunnel under the proverbial Berlin Wall and escape to states with better (or less worse) fiscal policy. And that will mean fewer jobs and lower wages than otherwise would be the case.

It goes without saying, of course, that California’s politicians will respond to Prop 30 by increasing the burden of government spending. They then will act surprised when revenues fall short of projections because of the Laffer Curve.

The bottom line is that the state will remain in the fiscal ditch and I expect a Greek-style fiscal crisis. When that happens, I’ll be tempted to point and laugh and make snarky comments such as “you broke it, you bought it.” But my long-run worry is that Obama may push for a federal bailout.

Let’s now take a look at the other ballot measures I wrote about on Monday.

I said the two most important measures were Prop 30 in California and Prop 2 in Michigan. Well, we know things went the wrong way in the Golden State on Prop 30, but it seems the voters in the Wolverine State are a bit more rational.

Prop 2, which would have permanently rigged the rules even further in favor of government workers, was soundly defeated by a 58-42 margin. Taxpayers presumably recognized that it wouldn’t be a good idea to dig the hole even deeper.

Here’s a quick breakdown of the other ballot measures. A majority of them went the right way. I’ve underlined good votes.

Prop 38 and Prop 39 – Two additional tax hike measures, the first targeting individual taxpayers and the second targeting businesses. Rejected 73-27 and approved 60-40.

Prop 204 in Arizona – Renewing a one-cent increase in the state sales tax, ostensibly for the education bureaucracy. Rejected 65-35.

Issue 1 in Arkansas – Imposing a half-cent increase in the state sales tax, supposedly for highway spending. Approved 58-42.

Prop 5 in Michigan – Would require a two-thirds vote of both the state house and state senate to raise any tax. Rejected 69-31.

Prop B in Missouri – Raise the cigarette tax by 73 cents per pack. Rejected 51-49.

Constitutional Amendment Concurrent Resolution 13 in New Hampshire – A constitutional amendment to prohibit enactment of an income tax. Received 57 percent of the vote, but needed a super-majority for approval.

Measure 84 in Oregon – Would repeal the state’s death tax. Rejected 53-47.

Initiated Measure 15 in South Dakota – Increases the state sales tax from 4 percent to 5 percent. Rejected 57-43.

Initiative 1185 in Washington – Reaffirms the state’s two-thirds supermajority requirement before the state legislature can increase taxes. Approved 65-35.

Prop 114 in Arizona – Protects crime victims from being sued if they injure or kill criminals. Approved 80-20.

Amendment 2 in Louisiana – Strengthens right to keep and bear arms. Approved 73-27.

Amendment 64 in Colorado, Measure 80 in Oregon, and Initiative 502 in Washington – All of these ballot measures end marijuana prohibition to varying degrees. Approved 55-45 in Colorado. Rejected 55-45 in Oregon. Approved in Washington.

Prop 1 in Idaho – This measure would overturn recent legislative reforms to end tenure in government schools. Rejected 57-43.

Prop 3 in Michigan – Require 25 percent of electricity to come from renewables. Rejected 63-37.

Question 1 in Virginia – Limits eminent domain to public purposes. Approved 75-25.

Amendment 6 in Alabama, Amendment 1 in Florida, Prop E in Missouri, Legislative Referendum 122 in Montana, and Amendment A in Wyoming – These are all anti-Obamacare initiatives in some form or fashion. Approved 60-40 in Alabama. Rejected 51-49 in Florida. Approved 62-38 in Missouri. Approved 67-33 in Montana. Approved 77-23 in Wyoming.

Is there a single lesson or theme we can discern from all these results? Other than the fact that people in California and Oregon are downright crazy?

Beats me. I think most Americans still believe in the classical liberal vision of a small federal government. But I also think the entitlement culture is becoming a greater and greater problem.

P.S. Speaking of the Iron Curtain, Walter Williams imagines California with a barbed wire fence to stop tax escapees.

P.P.S. This great Chuck Asay cartoon imagines how future archaeologists will view the Golden State.

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Last night was great. Two big victories, including a major comeback. Lots of drama, plenty of excitement. Here’s the bottom line: Notwithstanding chilly conditions and determined opposition, my Arlington County softball team cemented its hold on first place by sweeping a doubleheader. And I was 4-6 with a pair of doubles, so I managed to contribute.

Oh, wait, a few of you are interested in something else that happened last night…that’s right, there was an election. Before contemplating what this means for the nation, let’s quickly check my predictions.

  • Well, my presidential pick was fairly accurate. Even though people were scolding me for being too favorable to Obama, it turns out that I wasn’t favorable enough. He won all the states I thought he would, and he also carried Colorado and Florida. And if about 100,000 people changed their minds, my prediction would have been perfect.
  • But I was way off in my predictions for the Senate. I actually thought Republicans would pick up a couple of seats. But they somehow managed to lose a few seats, even though Democrats had more than twice as many to defend.
  • That being said, I did a semi-decent job with my guess for the House of Representatives. We don’t know all the details yet, but Republicans pretty much fought to a draw.

Now let’s think about the consequences for America.

Based on the conversations I’ve had and the emails I’ve received, many of you are very glum. I can understand the angst, so let me try to cheer you up by mentioning seven silver linings to this dark cloud.

1. There will be a once-in-a-lifetime opportunity to reform entitlements the next time a Republican wins the White House. But it has to be the right kind of reform, not means-testing, price controls, and other gimmicks designed to somehow prop up the current programs. Romney did select Paul Ryan as his running mate, so it’s possible he would have pushed for structural reforms. But I’m guessing that the guy who adopted Obamacare on the state level ultimately would have botched this issue. This means good reforms are still possible, perhaps in as little as four years.

2. One of the most worrisome things about Mitt Romney is that he repeatedly refused to rule out a value-added tax when asked by the editors of the Wall Street Journal. I don’t trust politicians when they say they’ll do the right thing. So when they refuse to even give rhetorical assurances, alarm bells definitely start ringing. My nightmare scenario is that Romney would have been elected, made some half-hearted attempt to restrain spending, and then would have decided that a new source of revenue was needed once Harry Reid said no to any fiscal restraint. And as we saw during the Bush years, Republicans in Congress generally are willing to do the wrong thing when a Republican President makes the request. With Obama in the White House, it is highly unlikely that House Republicans would agree to this dangerous new tax.

3. As a general rule, the party controlling the White House loses seats in the House and Senate during mid-term elections. This presumably means more Tea Party-oriented Representatives and Senators after 2014.

4. With Obama in the White House for four more years, there’s an opportunity for a genuine advocate of small government to run and win in 2016. I don’t know whether that person will be Senator Marco Rubio, Senator Rand Paul, Governor Bobby Jindal, Representative Paul Ryan, or someone who isn’t even on my radar screen, but all of those options seem far more appealing – both philosophically and politically – than the GOP candidates who ran this year.

5. A Romney victory may have paved the way for Andrew Cuomo or some other statist in 2016. There will be leftists running next time, of course, but I’m guessing it will be more difficult for such a candidate to win since voters often get antsy after one party is in power for too long.

6. The election was not a mandate for Obamacare or the faux stimulus. The President spent almost no time bragging about the two biggest “accomplishments” of his first term. Indeed, he was probably fortunate that he ran against a Republican who couldn’t really exploit Obamacare because he did something very similar when he was Governor of Massachusetts (as this cartoon humorously illustrates). And he certainly didn’t get any political benefit from having flushed $800 billion down the drain on a bunch of Keynesian  gimmicks.

7. One very positive feature of the elections is that lawmakers did not measurably suffer because of their support for the Medicaid and Medicare reforms in the Ryan budget. Nancy Pelosi’s “Medi-scare” campaign was the dog that didn’t bark in the 2012 elections. This presumably bodes well if there’s ever a pro-reform President.

Now here are three reasons to be unhappy.

1. Obama is a bad President. His Keynesian stimulus was a flop. Obamacare made a bad healthcare system even worse. He keeps pushing for class-warfare tax policy. And he wants to increase the burden of government spending. I fully expect him to pursue the same misguided policies in a second term.

“Ha, ha, ha, I will haunt your dreams for the next four years!”

2. If there are any vacancies on the Supreme Court, they will be filled by doctrinaire leftists. So the great libertarian conspiracy to restore constitutional constraints on the federal government will be temporarily postponed.

3. We have to endure four more years of sanctimonious speeches.

But I doubt Romney would have pursued good policies, picked good Justices, or given uplifting speeches, so I would have been unhappy regardless.

So cheer up, my friends. Our Founding Fathers had to risk their lives, their fortunes, and their sacred honor to create America. In the battle to restore/protect their vision, all we have to do is engage in some activism.

P.S. Since I’ve written that conservatives and libertarians share some common ground on the issue of abortion, I’m going to make a friendly suggestion to pro-life Republican candidates and their consultants. Spend a couple of days before each campaign developing a few on-the-shelf talking points so you’re less likely to say really stupid things about rape and abortion.

P.P.S. For my partisan Republican friends who are looking for someone to blame, allow me to suggest George Bush and Karl Rove. By deliberately choosing bad policy in hopes of gaining short-run political advantage, they created the medium-run conditions that enabled Obama to win the White House.

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Tonight is going to be special.

But not because of the election. It will be special because I’ll be playing my final softball games of the year.

I had this poster in my room. Great memories.

That being said, I can’t help but think back in time to an election night that was very special.

I’ve already expressed my view that Ronald Reagan was the greatest President of the past 100 years. Indeed, his only competition is from Calvin Coolidge.

I was fortunate to be politically active at the time, having started a Students for Reagan group at the University of Georgia (where we beat native-son Jimmy Carter by a 2-1 margin in the campus mock election).

At the risk of being self-indulgent, let’s re-live the happy memory of what happened 32 years ago. Just imagine how these NBC News journalists must have hated making this announcement.

Let’s also enjoy this moment from CBS News. Gee, don’t Walter Cronkite and Dan Rather look happy?

What a great night that was, followed by these great words just a couple of months later.

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If readers of this blog were the only ones voting, Mitt Romney would win in a landslide with 70 percent of the vote and Gary Johnson would edge out Barack Obama for second place.

But I have a sneaking suspicion that readers of International Liberty are not quite representative of the overall population (I need more looters and moochers in my audience, sort of like what you see in this cartoon).

Yes, I’m going to be bold and say that Obama will get more than 12.5 percent of the vote.

Indeed, I’m guessing he’ll get at least a plurality of the vote. And I’m specifically predicting he’ll get a majority of the electoral college.

I’ve been predicting that Obama would win re-election for the past six months, and I see no reason to change my mind now that it’s election day. I’m even moving two more states – New Hampshire and Virginia – into Obama’s column, which will be enough to give him a 294-244 margin in the electoral college.

As you can see from the large number of states in the “leaning” category, I don’t have a high level of confidence in my prediction. And plenty of my Republican friends have made strong arguments that the polls are flawed because of “turnout” assumptions.

But I have no competence to judge the veracity of these claims, so I’m going with my gut instinct and calling it for the Spender-in-Chief.

If my guess of an Obama victory turns out to be correct, I suppose I could claim special insight because of my January 1 prediction that Obama would win if the unemployment rate fell under 8 percent. But as you can see from this graph, I’ve always shown Obama ahead, even when the joblessness rate was higher.

For what it’s worth, I don’t think there’s anything terribly unusual or unconventional about my predictions for the electoral college. But I am going to be a non-conformist in my guesses about the partisan breakdown of the U.S. House and U.S. Senate.

Republicans began the year with high hopes of taking control of the Senate, but a series of mis-steps have hurt the GOP and some people even predict they will lose seats. That’s possible, but I’m going out on a limb and predicting a two-seat gain for Republicans.

I’m also going to be a non-conformist in my predictions for the lower chamber, guessing a one-seat pick-up for the GOP.

I’ll also make two final predictions. First, drawing from my post yesterday about key ballot initiatives, I predict that California voters will reject all the proposed tax increases. This will prove that left-wingers are capable of being right-wingers when their own money is on the table.

Second, I’ll offer a prediction that’s about as controversial as asserting that the sun will rise in the east and set in the west. I predict that government will get even bigger over the next four years, which will mean more corruption and weaker economic performance.

P.S. My predictions for the U.S. Senate assume that the independent candidate will win in Maine and will ally himself with the Democrats.

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I wish the rest of the world was as wonky as me and dying to read the latest data on the Laffer Curve, or something like that.

Alas, it seems like everybody is focused on which statist will be confiscating our earnings and trying to dictate our lives for the next four years.

So I’ll go with the flow and share some election-oriented humor, beginning with jokes from the late-night talk shows.

Normally I wait several weeks and accumulate a larger list, but many of these jokes will be past their expiration dates if I wait until after the election. So enjoy.

Jay Leno

  • Last night I answered the door and there was a kid lying on the porch. He was playing dead. I said: “What are you supposed to be?” He said: “the economy.”
  • President Obama canceled the annual White House Halloween party. He didn’t want to; he just didn’t want to risk a trick-or-treater asking him a question about Libya.
  • I had a trick-or-treater tonight who stood outside on my porch for an hour, didn’t ring the bell, didn’t knock on the door. I said, “Who are you supposed to be?” He said, “I’m an undecided voter.”
  • Donald Trump, did you see him today? He was giving candy only to kids who could show their birth certificate and their school records.
  • Economists say rebuilding after Hurricane Sandy will give the ailing construction industry a huge boost. In fact, the storm has already created more jobs than President Obama.
  • “Don’t ask, don’t tell” is back. Not for gays in the military — it’s President Obama’s new policy for questions about Libya.
  • Republicans are accusing the White House of successfully engineering a massive cover-up of the Libyan attack. But, on the plus side, it’s the first time in four years Republicans have given credit to Obama for doing anything successfully.
  • Folks back east are feeling the devastating effects of Hurricane Sandy — 100-mile-an-hour winds, lot of folks without power. Because of the hurricane, both candidates have had to cancel speeches and campaign events. So at least some good has come out of it.

David Letterman

  • Mitt Romney resumed campaigning today. He was visiting those hardest hit by the storm, and that would be swing-state Latinos.
  • The New York City Marathon is still on for Sunday. Typically the New York City Marathon is won by a guy from Kenya. No, no, I’m sorry. I’m thinking about next week’s election.
  • Are you excited about Halloween? People go out pretending to be something they’re not, looking for handouts. It’s like running for president.
  • You folks ready to vote? On the bright side, after Tuesday we’ll finally be rid of at least one candidate. That’s good news.
  • Mitt Romney is reminding everybody about changing your clocks. He’s urging his voters, his constituents, and all Americans to turn your clocks back to 1954.

Conan

  • Everybody’s mind is on Hurricane Sandy. The worst is over. Now people are discussing the cause. Sources say that it was partly caused by global warming. Meanwhile, Fox News said it was caused by two men kissing in Central Park.
  • President Obama now has a 52-point lead with Hispanics. However, Mitt Romney has a 90-point lead with the people who hire Hispanics.

Jimmy Kimmel

  • Mayor Bloomberg announced that all cars coming into New York City via the bridges must have a minimum of three people in them. Unless one of the people is very, very fat — in which case, two people but no sodas.

Now here’s a video that will probably appeal more to my Democrat-leaning friends, but everyone should enjoy it because it is well produced and effective satire. Sort of reminds me of the videos in this post.

In the interest of fairness, here are a couple of cartoons for my Republican-leaning friends. The first one is actually very misguided since it assumes Obama should be doing something about the hurricane. Wrong, emergency response should be an issue for the affected state and local governments.

But just as the video is amusing because if focuses on Romney’s wealth, this cartoon is effective because it focuses on Obama’s inflated sense of self.

This next cartoon is funny for the obvious reason, but it also makes a good point. If my prediction is wrong and Romney pulls an upset, I fully expect the establishment media to produce a lot of navel-gazing analysis about the latent racism of the American people (never bothering to explain, of course, how non-racist people in 2008 somehow became racists in 2012).

Maybe, just maybe, if Romney prevails, the establishment press should be open to the idea that voters aren’t very happy about a rising burden of government spending. That’s certainly what we see in this new polling data.

That doesn’t mean, of course, that Romney would solve the problem. He could be another big-government statist like Bush. Indeed, I think his failure to articulate a pro-freedom message is one reason why he seems to be slightly behind.

But the one thing that comforts me about this election is that the American people seem to understand that government is the problem, not the solution. Gee, where have I heard words like that before?

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Two years ago, I highlighted nine key state ballot initiatives and happily reported about a week later that voters generally chose to limit statism.

We have a similar collection of measures this year. Some of these votes – such as the decisions about higher taxes in California and power for government employee unions in Michigan – will have profound implications and perhaps even signal whether certain jurisdictions are doomed to failure.

Since I’m motivated primarily by the desire to reduce the burden of government spending and block bad tax policy, let’s look first at the key fiscal measures on this year’s ballot.

Prop 30 in California – Would impose a huge tax hike, including an increase in the state sales tax from 7.25 percent to 7.5 percent, along with three new higher income tax brackets (maxing out at more than 13 percent!) for upper-income taxpayers. The adjoining cartoon is a good summary of the issue, as is this classic bit of political humor.

Prop 38 and Prop 39 – Two additional tax hike measures, the first targeting individual taxpayers and the second targeting businesses. I’m not sure which tax-hike proposition is the worst, but they all need to be defeated for there to be any hope about California’s future.

Prop 204 in Arizona – Renewing a one-cent increase in the state sales tax, ostensibly for the education bureaucracy. Money is fungible, so this is merely a vote for bigger government.

Issue 1 in Arkansas – Imposing a half-cent increase in the state sales tax, supposedly for highway spending. Another bait-and-switch scam to trick voters into financing bigger government.

Prop 5 in Michigan – Would require a two-thirds vote of both the state house and state senate to raise any tax. Anything that makes it harder to raise taxes is also a step making it harder to boost the burden of spending.

Prop B in Missouri – Raise the cigarette tax by 73 cents per pack. Politicians in the Show Me state should kick their addiction to big government.

Constitutional Amendment Concurrent Resolution 13 in New Hampshire – A constitutional amendment to prohibit enactment of an income tax. The Granite State has been blessed by avoiding either a state sales tax or a state income tax. It’s almost a shame that there’s a First Amendment guaranteeing free speech, because otherwise I’d be tempted to outlaw even discussion of imposing an income tax.

Measure 84 in Oregon – Would repeal the state’s death tax. This should be a no-brainer. You don’t want to repeat the mistakes of New Jersey and drive productive residents to other states. But Oregon voters have demonstrated a lemming-like suicide instinct in the past.

Initiated Measure 15 in South Dakota – Increases the state sales tax from 4 percent to 5 percent. There’s no income tax, but that’s no argument for making a modest sales tax into an onerous sales tax.

Initiative 1185 in Washington – Reaffirms the state’s two-thirds supermajority requirement before the state legislature can increase taxes. Voters repeatedly have reaffirmed their support for the supermajority in the past. Let’s hope that doesn’t change now.

Now let’s shift to matters of personal freedom and look at ballot measures involving the Second Amendment and the Drug War.

Prop 114 in Arizona – Protects crime victims from being sued if they injure or kill criminals. Yes, there are examples of excessive response, but the easiest way of avoiding those situations – if you’re a criminal – is by keeping your nose clean.

Amendment 2 in Louisiana – Strengthens right to keep and bear arms. If this doesn’t pass by more than 80 percent, I’ll be disappointed.

Amendment 64 in Colorado, Measure 80 in Oregon, and Initiative 502 in Washington – All of these ballot measures end marijuana prohibition to varying degrees. Let’s hope voters take a small step in ending the War on Drugs.

These initiatives are related to fiscal policy, but they belong in a special category since they deal with the necessity of curtailing bloated and over-compensated government bureaucracies.

Prop 1 in Idaho – This measure would retain recent legislative reforms to end tenure in government schools. The only real solution is school choice, but this measure at least should make it easier to get rid of awful teachers that contribute to making the public schools both costly and ineffective.

Prop 2 in Michigan – Creates permanent negotiating advantages for already pampered government employee unions. This is the bureaucrat equivalent of Prop 30 in California, a massive transfer of wealth and power from the productive sector. If it passes, Michigan probably would be past the tipping point in its descent into stagnation and despair.

Last but not least, here are measures on random issues that are very important.

Prop 3 in Michigan – Require 25 percent of electricity to come from renewables. This will be an interesting test of whether the voters of a particular state are so clueless about economics that they are willing to voluntarily boost their own energy bills and undermine their own job prospects. I almost hope it passes just for the lesson it will teach.

Question 1 in Virginia – Limits eminent domain to public purposes. Corrupt developers and their cronies in state and local government don’t like this proposal, which naturally means it is a very good idea for those who support property rights.

Amendment 6 in Alabama, Amendment 1 in Florida, Prop E in Missouri, Legislative Referendum 122 in Montana, and Amendment A in Wyoming – These are all anti-Obamacare initiatives in some form or fashion. Continued resistance is important, even if some of these measures are only symbolic, so fingers crossed that they’re all approved.

You can find more information about state ballot initiatives and referendum here, here, here, here, and here.

And one final philosophical/policy point: In an ideal world, the United States would be like Switzerland and have a much more robust version of federalism. Almost everything that happens in Washington, with the exception of national defense, should either be in the private sector or at the state and local level of government.

A big advantage of a genuinely federalist system is that competition among states would be more vigorous than it is today. So if Michigan voters enacted Prop 2 or California voters approved Prop 30, tho adverse consequences would materialize much faster, thus helping to educate people that free markets and limited government are the best policies.

Addendum: How did I forget the all-important Los Angeles referendum to create a special bureaucracy to monitor condom usage in the porn industry.

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I was going to wait until the morning of the election to make my final prediction for the 2012 elections, but I’m inexplicably getting a lot of emails asking whether I’ve changed my mind since I predicted last month that Obama would eke out a narrow 271-267 victory.

So I’m going to cave to peer pressure and make a next-to-final guess about the outcome.

But my GOP friends won’t be happy, because the only thing I’m changing is that I’m putting Nevada in Obama’s column.

You’ll also notice I’m hedging my bets by putting lots of states in the “leaning” category. Depending on how these states break, we could get everything from a 332-206 rout for Obama to a comfortable 301-237 victory for Romney.

I’m curious, by the way, to see who readers support. Please vote below, and feel free to add additional thoughts in the comments section. This is a highly scientific poll (at least by the standards of the global warming cranks who say that “climate change” causes AIDS and that skeptics are racist).

The candidates are in alphabetical order, by the way, so Gary Johnson’s position has no significance beyond the fact that “J” comes before “O” or “R.”

Next Tuesday, I’ll include my predictions for the House and Senate when I make my final guess about the presidential election. Not to brag too much, but I was right on the mark in my prediction for the U.S. House and off by just one seat in my prediction for the U.S. Senate.

P.S. I’ll be very happy next Wednesday because the political silly season will be over and we can get back to what really matters – figuring out how to control the burden of government spending, how to implement much-needed entitlement reform, and how to fix the corrupt tax system.

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From a rational perspective, the logical choice is not voting. After all, the odds of your vote making a difference are infinitesimally small.

But that’s if you view voting as an “investment” choice – i.e., you taking time and effort to do X in hopes of getting Y in return.

The other view is that voting is a “consumption” choice – i.e., something we do for enjoyment, like eating a hamburger or going to a movie. You recognize your vote almost surely won’t matter, but you do it because it gives you pleasure to vote for someone (or, in my case, it gives you pleasure to vote against someone).

Now let’s consider libertarians, conservatives, and other advocates of small government. Regardless of whether they’re investment voters or consumption voters, what should they do this election?

You could take an online test and see which candidate matches your views.

Mike Godwin of Reason, however, says you should vote for Barack Obama. Though he starts out by suggesting that most of us should vote for the Libertarian candidate.

…if you’re a Libertarian who’s not in a swing state – you live in California, maybe, or Texas – there’s no compelling reason for you to cast your vote for anyone other than Gary Johnson.

But then he argues that voters in battleground states should prefer Obama over Romney.

…you should give some thought to voting for Obama as the lesser of the two big-government, Harvard-educated evils. …Romney seems perfectly capable of adopting a liberal government program when it suits him. While Romney officially opposes Obamacare, it’s scarcely different from the health-care reform Romney presided over in Massachusetts.

I suspect most supporters of limited government won’t disagree with his assertion that Romney is squishy, but then Godwin goes off the reservation.

…there actually is a libertarian argument for Obamacare. …a truly universal system is the best option for maximizing health-care efficiencies. And if we can preserve some aspects of competition among insurers (which Obamacare, mimicking the health-care plan proposed by the GOP to counter Bill Clinton’s efforts at health-care reform, attempts to do), that’s all to the good. But there’s an even stronger libertarian argument for Obamacare. Namely, it frees more Americans to take better jobs without worrying about losing the health care plan they had in their old jobs. Worker mobility is one of the things that reliably fuels free enterprise, and workers will be more mobile under Obamacare than they would be under Romney’s semi-dismantled version of it.

I obviously disagree, but Godwin isn’t being crazy. Indeed, he’s basically echoing the pro-mandate position that was advanced by my former colleagues at the Heritage Foundation.

This is a reasonable position if you start from the premise that there’s no way of unwinding most of the existing government policies that have prevented markets from operating in the healthcare sector. That’s not my view, so I’m merely saying Godwin has a legitimate point, not that he’s right.

Getting back to his pro-Obama argument, he closes with discussion of social issues.

…let me underscore three points where Obama is surely closer to libertarians than Romney is. One of these is abortion rights, self-evidently. …Another is immigration. …A third quasi-libertarian position is Obama’s late-arriving but still-welcome stance on gay marriage.

I don’t find these arguments compelling. Libertarians are not monolithically pro-life or pro-choice. But to the extent there’s unanimity, they agree that Roe v. Wade was a nonsensical decision and that the issue should be decided by state legislatures. Which sort of makes them allies with Republicans, even if they don’t necessarily agree with how states should handle the issue.

I’m also more skeptical of immigration amnesty than the average libertarian, largely because I agree with Milton Friedman about the risks of combining open borders with a welfare state.

And I also think marriage should be a private institution with no role for government, though if you read the details of the article, it appears that Godwin has the same perspective.

“Me, the choice of libertarians?!?”

To summarize, I don’t find Godwin’s arguments convincing. If he really wanted to convince conservatives, libertarians, and other supporters of small government that Obama was the right choice, he should have argued that Romney would be another big-government statist like Bush. That’s a very compelling argument, as you can see from this list of Romney transgressions.

He even could have made the argument that keeping Obama for an additional four years would be the best way of laying the groundwork for a Reagan-style victory in 2016 with a presumably small-government advocate like Rand Paul, Marco Rubio, or Paul Ryan at the top of the ticket. That would have caught my attention since my first political decision was to favor Carter over Ford in 1976 in hopes of paving the way for Reagan in 1980.

By the way, I’m not saying it’s right or wrong to vote for Romney, Obama, or Johnson. My job is to focus on policy, not politics. But it is the silly season of politics, so I can’t resist making some observations.

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I’m still holding to my prediction of a narrow 271-267 victory for President Obama, but he’s clearly lost momentum.

“Hey Obama, you can’t do it”

Even in Hollywood.

I wrote a few months ago about Jon Lovitz rejecting the President’s class-warfare fiscal policy.Then he got mocked by Clint Eastwood, leading to a series of empty chair jokes (see herehere and here).

Now we see Rob Schneider turning against Obama, even though he is a self-professed liberal. Here are the details from The Blaze.

Actor and comedian Rob Schneider declared that he’s “come around” and will not be voting to give “crappy” President Barack Obama a second term. The former “Saturday Night Live” cast member was on the Atlanta-based “Regular Guys” radio show Friday and said that though he is a liberal and a Democrat, he will not vote for Obama. “If Obama gets back in there, all those people that are already entrenched in that system of bureaucracy are going to be more entrenched, so I’m for kicking them out and starting over,” Schneider said. “I’ve come around to this. As a liberal, as a Democrat, there is no way that I can support Obama for a second term.”

But my Republican friends shouldn’t get too excited. Obama still has overwhelming support from the limousine liberals in Hollywood.

When you’re sufficiently rich, the difference between 1 percent growth and 3 percent doesn’t really have much of an impact on your personal situation. It’s the rest of us peasants who need the growth and prosperity made possible by free markets and limited government.

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