Powerful – but Deeply Flawed – Leftist Imagery

I have given the left credit many times for clever humor, even when their satiric efforts target libertarians.

• A video portraying Somalia as a libertarian paradise.
• Two cartoons, one on libertarian ice fishing and the other showing libertarian lifeguards.
• A montage showing 24 types of libertarians.
• Six different perceptions of libertarians.

Well, it’s time to give the left credit again. I don’t know whether to call this satire, humor, or if I should just lump it in the catch-all category of social commentary, but it is effective. It’s visually powerful and leaves a clear message.

Even the small touches are clever, including Bush and the Pope on the TV, as well as the IMF sticker on the IV pole (though I’m surprised, given the bureaucracy’s statist track record, that the left thinks the IMF is the enemy).

But I’m not sharing this image out of pure appreciation for effective imagery. I also think it reveals two themes of left-wing thought, one foolish and the other legitimate.

1. The foolish theme is that rich nations are rich because poor nations are poor. This is the same mentality that you find among leftists such as Obama, who assume that rich people in America are rich because they somehow deprived the poor.

2. The accurate theme is that bigwigs sometimes use the coercive power of government to obtain unearned wealth. And in some cases, that unearned wealth comes from corrupt deals with politicians from third-world governments.

I address both of these points in this interview, pointing out that true capitalism generates an expanding economy so that the rich and poor both benefit, but that cronyism enables the politically well-connected to rip off taxpayers and/or consumers.

If we want to promote liberty, it would help to enlist the help of those leftists who legitimately want to make the world a better place (as opposed to the union thugs, political hacks, grievance mongers, and others who use statism as a racket to achieve wealth and power).

We need to educate the honest left about why they’re wrong about the first theme and why we’re on their side regarding the second theme.

The challenge is to teach them that good intentions sometimes don’t lead to good results, so that we can fix the mentality displayed in this cartoon.

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Food Stamps, Handouts, and the Ever-Expanding Welfare State

In their never-ending efforts to buy votes with other people’s money (see the first cartoon in this post), politicians have been expanding the welfare state and creating more dependency.

This is bad for the overall economy because it means a larger burden of government spending and it’s bad for poor people because it undermines their self reliance and self respect.

It also has very worrisome long-run effects on the stability and viability of a culture, as shown by these two cartoons.

A stark example can be seen in the food stamp program, which has morphed from a handout for the genuinely poor to a widespread entitlement for everyone from college students to the Octo-mom, and for products ranging from luxury coffee to lobster.

Here are some of the unpleasant details about the fiscal costs from Veronique de Rugy’s column in the Washington Examiner.

When the food stamp program was first expanded nationally in the 1970s, just 1 in 50 Americans participated. Today, 1 in 7 Americans receive $134 each month… With the bipartisan Farm Bill going through Congress right now, these high levels of dependency may become permanent. Some 70 percent of the nearly $1 trillion Farm Bill recently passed by the Senate will be spent on food stamps — that’s $770 billion over ten years. …An estimated 45 million Americans received food stamps in 2011, at a cost of $78 billion. That’s a twofold increase from just five years ago when 26 million people received benefits at a cost of $33 billion. …food stamp enrollment increased and spending doubled, even as unemployment and the poverty level dropped modestly between 2007 and 2011. The more important part of the story comes from the eligibility changes implemented by the Bush and Obama administrations.

The last sentence is the key. Eligibility has been expanded dramatically. Food stamps are slowly but surely becoming mainstream and that should worry all of us.

But food stamps are just one form of income redistribution. Welfare spending also is a problem.

Here are some excerpts from a New Hampshire story, featuring a store clerk who got fired because she didn’t think welfare cards should be used to buy cigarettes.

Jackie R. Whiton of Antrim had been a six-year employee at the Big Apple convenience store in Peterborough until a single transaction sent her job up in smoke. The store clerk was fired after she refused to take a customer’s Electronic Balance Transfer card to pay for cigarettes. …Whiton said she did not think EBT cards could be used to purchase cigarettes and refused to sell to him. The two “had a little go-around” as the line got longer behind him, said Whiton. “I made the statement, ‘do you think myself, that lady and that gentlemen should pay for your cigarettes?’ and he responded ‘yes,’ ” Whiton said. …Charles E. Wilkins, the general manager of the C.N. Brown Co. that runs the stores, said the EBT cards in the cash phase could be used for any items, including alcohol, tobacco and gambling. Wilkins said the company gave Whiton the option of staying but she said she would not accept the cards anymore. “She didn’t think it was right and just wasn’t going to sell to people in that program anymore,” Wilkins said. Whiton said when she came to work the next day, her manager asked her how much notice she was giving. When she responded “a week,” she was told the home office had just called and fired her.

Ms. Whiton is now one of my personal heroes, joining Mr. Mothershead, another store clerk who had the right reaction when confronted by someone who tried to get something he didn’t earn (albeit using a different tactic).

Last but not least, here’s something that arrived in my inbox yesterday.

A bit harsh, but we have gotten to a strange point where the Obama Administration is bribing states to add more food stamp recipients and even running ads to lure more people into food stamp dependency.

So, yes, Billy Fleming (assuming he’s real) has a right to be upset.

P.S. Here’s some more welfare humor.

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Cartoons about the Supreme Court’s Obamacare Decision: Laughing in the Face of Tragedy

I’ve already thrown in my two cents on yesterday’s disappointing decision, and I was planning on ignoring the issue for a few days because I’m so irked by the result.

But they say laughter is an effective part of grief therapy, so let’s take some solace in these cartoons.

This first one is about the very serious issue of increased authority and power for the IRS.

Technically, the Supreme Court decision didn’t give the IRS any more power than it already had been given under the legislation, but the cartoon isn’t claiming otherwise, so it gets points for being accurate and (tragically) amusing.

By the way, here’s a cartoon making a similar point from back in 2010 when Obamcare was being debated.

Next we have a cartoon about Chief Justice Roberts and his new BFF status with Obama. I almost didn’t include it because Roberts deserves nothing but scorn, but I don’t want my feelings to interfere.

Speaking of Roberts, this next cartoon is accurate in many ways.

It’s designed to blame Bush for appointing a Justice who would put establishment approval before fealty to the Constitution, but I think it’s also true because Obama might not have won – and the Democrats certainly wouldn’t have picked up so many seats in the House and Senate – if Bush had not imposed so much statist legislation and weakened the economy, thus paving the way for big Democrat victories in 2006 and 2008.

And here’s a cartoon making the obvious point that Obama prevaricated.

I’ve saved my favorite for last, showing how the Supreme Court botched its responsibility.

But even though it’s my favorite of the five cartoons, I would make a change (just like I suggested alterations to a very good Chuck Asay cartoon back in April).

In this case, I also would amend this gem by replacing “economy” with “Constitution.”

I hope all these cartoons make you feel a bit better. If not, you can look at some R-rated Obamacare humor here, here, and here. And, just for the heck of it, here’s a PG-rated Obamacare joke to end on a more subdued note.

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Big Government Cripples Incentives to Save, Promotes Risky Culture of Immediate Gratification

America’s political elite is nauseating for many reasons, but perhaps most of all when they blame others for problems that are caused by misguided government policies. A stark example is the way they attacked the Facebook billionaire who moved to Singapore because of punitive taxation and class-warfare policy.

Today, let’s look at an example that affects almost everybody rather than just a handful of rich people. Many people in Washington sanctimoniously say that American households and businesses are too focused on the short term and that we don’t save enough.

But as I explain in this CBNC interview, tax and spending policies from Washington have undermined the incentive to save.

Allow me to elaborate on three of my examples.

1. Look at this post comparing the red ink from America’s bankrupt Social Security system with the huge levels of private savings generated by Australia’s system of personal retirement accounts.

Good politicians would respond by copying Australia and reforming Social Security. But good politicians are like unicorns.

2. Or look at this chart showing the extensive double taxation in our tax code, as well as these international comparisons of how America over-taxes dividends and capital gains.

Good politicians would respond by junking the tax code and adopting a flat tax, which has no double taxation of income that is saved and invested. But good politicians are like the Loch Ness Monster.

3. And consider the fact that the Obama Administration has just imposed a regulation that will discourage foreigners from depositing money in American banks, thus driving capital from the U.S. economy.

Good politicians would minimize the damage of anti-savings policies by keeping America a haven for foreign capital. But good politicians are like Bigfoot.

The moral of the story, just in case you haven’t picked up on the theme, is that bad things happen because politicians can’t resist expanding the burden of government when they should be doing the opposite. Which is why this poster is funny, but in a painful way.

P.S. I should have mentioned that some politicians think that we can boost savings by imposing a value-added tax! This is not only a perverse example of Mitchell’s law, but it’s also completely illogical.

A VAT does not change the incentive to save since current consumption and future consumption are equally taxed. But it does reduce the amount of money people have, thus reducing both private consumption and private savings.

Statists would argue that a new tax will reduce the budget deficit and thus reduce the amount of private savings that is being used to finance government debt. That’s only true, though, if you’re naive enough to think politicians won’t spend the new revenue. Good luck with that.

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Yes, the Federal Government Has a Broad Power to Tax, but that’s Different from Having a Green Light to Spend

I’m not a lawyer, or an expert on the Constitution, though I sometimes play one on TV.

But I can read, and I’ll agree with my friends on the left that the federal government has a broad power to tax. I wish the 16th Amendment had never been ratified, but its language gives the federal government a green light to rape and pillage.

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

That being said, the power to tax is not the same as the power to spend. And at the risk of sounding old fashioned, my big objection to the Obamacare decision is that health care is not listed as one of the federal government’s enumerated powers in Article I, Section VIII of the Constitution.

Sadly, that horse got out of the barn many decades ago, culminating in a horrible 1942 Supreme Court decision that said a man couldn’t grow crops on his own land to feed his own animals for consumption by his own family.

But let’s look at the bright side. Even though the Obamacare case was decided incorrectly, at least the judiciary is beginning to reconsider these issues, thanks in large part to the work of the Cato Institute’s legal scholars and adjunct legal scholars.

P.S. While the federal government has a broad power to tax, I should add that this doesn’t – or at least shouldn’t – vitiate other provisions of the Constitution. This is why it is so disappointing that we’ve seen the erosion of key civil liberties such as the presumption of innocence and the 4th Amendment’s protection against unreasonable searches and seizures.

P.P.S. This Michael Ramirez cartoon about Obamacare and the Constitution is amusing, though that’s not much solace given what happened. And here’s another one of his cartoons, this one on the broader theme of Obama vs. the Founding Fathers.

P.P.S. Speaking of cartoons, this one seems especially appropriate today.

If you like that one, you can see another Breen cartoon here.

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It’s My Birthday and I Want a Constitutional Present from the Supreme Court

I was born 54 years ago in the People’s Republic of New York.

Back then, all I wanted was a new baseball glove

But I don’t mention that because I want you to send me a present or to say Happy Birthday.

Instead, I’m hoping at least five of the Justices on the Supreme Court will make this day special by rejecting Obamacare.

And I mean the entire legislation, not just the mandate. I want them to throw out all the new taxes, all the new spending, all the new subsidies, and all the new market distortions.

My video on Obamacare, for instance, completely focused on how the legislation would expand the burden of government. The mandate is a bad idea, without question, but it’s also a big mistake to impose more spending and taxes when government already is far too big.

I’m worried, though, that the Court will reject the mandate and decide the rest of the law is okay. Not only does this mean we’ll be stuck with bigger government, but it also creates a scenario where politicians – including squeamish Republicans – may decide to enact other bad laws.

John Stossel shares my concerns about what may happen after a Supreme Court decision.

I’m scared. I fear that even if the Supreme Court overrules most of Obamacare (or did already, by the time you read this), Republicans will join Democrats in restoring “good” parts of the law…parts of Obamacare are popular. People like getting what they think is free stuff.

John elaborates, noting that politicians may enact laws that destroy the insurance market.

…discrimination is what makes insurance work. An insurance regime where everyone pays the same amount is called “community rating.” That sounds fair. No more cruel discrimination against the obese or people with cancer. But community rating is as destructive as ordering flood insurance companies to charge me nothing extra to insure my very vulnerable beach house, or ordering car insurance companies to charge Lindsay Lohan no more than they charge you. Such one-size-fits-all rules take away insurance companies’ best tool: risk-based pricing. Risk-based pricing encourages us to take better care of ourselves. Car insurance works because companies reward good drivers and charge the Lindsay Lohans more. If the state forces insurance companies to stop discriminating, that kills the business model. No-discrimination insurance isn’t insurance. It’s welfare. If the politicians’ plan was to create another government welfare program, they ought to own up to that instead of hiding the cost.

And since big business has a dismaying habit of getting into bed with big government, John isn’t expecting the insurance industry to defend markets.

Women go to the doctor more often than men and spend more on medicines. Their lifetime medical costs are much higher, and so it makes all the sense in the world to charge women higher premiums. But Sen. John Kerry pandered, saying, “The disparity between women and men in the individual insurance market is just plain wrong, and it has to change!” The industry caved. The president of its trade group, Karen M. Ignagni, said that disparities “should be eliminated.” Caving was safer than fighting the president and Congress, and caving seemed to provide the industry with benefits. Insurance companies wouldn’t have to work as hard. They wouldn’t have to carefully analyze risk. They’d be partners with government — fat and lazy, another sleepy bureaucracy feeding off the welfare state. Alcoholics, drug addicts and the obese won’t have to pay any more than the rest of us. But this just kills off a useful part of insurance: encouraging healthy behavior. Charging heavy drinkers more for insurance gives them one more incentive to quit. “No-discrimination” pricing makes health care costs rise even faster.

I’ve repeatedly written that the only way to fix healthcare is to get rid of the government-created third-party payer problem.

Unfortunately, that will be very difficult precisely because people like the illusion that they don’t pay (even though they do bear the costs in the form of lower take-home wages and higher taxes).

So while I want a full-repeal birthday present from the Supreme Court, that will only provide fleeting happiness unless we solve the third-party payer problem caused by Medicare, Medicaid, tax distortions, and other forms of government intervention.

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The Crazy French Double Down on Obamanomics

Being a libertarian, I’m used to disappointment. So when something actually goes according to plan, I get very happy.

On that basis, I should be utterly and deliriously overjoyed about my endorsement of Francois Hollande to be President of France.  I wanted him to win, in part because he would engage in statist experiments that would help discredit bad policy.

Well, all my dreams are being fulfilled. Here’s some of a new report in the Wall Street Journal.

French Socialist President François Hollande is set to increase the minimum wage by more than inflation, betting consumers will help revive the country’s stalling economy, while his government levies more taxes on the wealthy and large corporations in a bid to reduce the budget deficit. …The government also is preparing to unveil tax increases to make good on its pledge to reduce the budget deficit to 4.5% of yearly output this year and 3% in 2013. The list includes a new tax on dividends, a new top income-tax bracket of 75% for people earning more than €1 million a year, and increases in the wealth and inheritance taxes.

It’s not terribly surprising that Hollande’s going the fully Monty with higher taxes. Indeed, I’ve already mocked those plans.

But I’m surprised that he’s pushing a higher minimum wage as well, particularly with unemployment already at high levels. This video explains why minimum wages undermine job creation and hurt the less fortunate, but Hollande apparently thinks his plan will stimulate growth.

Other European nations have become more rational and now understand that labor markets need to be more flexible.

The Smic increase and the fiscal plan are in line with Mr. Hollande’s election promises but position France at odds with most other euro-zone nations, which are seeking to keep a lid on labor costs to improve their competitiveness and rein in their budget deficits through spending cuts rather than tax increases.

The comment about “spending cuts” is nonsensical, however. Even though traditionally left-leaning organizations such as the World Bank have concluded that government is far too big in Europe, most governments have imposed huge tax increases. Only the Baltic nations have focused on spending cuts.

As such, we can expect more news like this in France.

In France, economic growth has evaporated, with national statistical office Insee forecasting a further rise in the jobless rate, from 10%. Flag carrier Air France last week said it needs to shed more than 5,000 jobs, around 10% of its workforce, by the end of next year.

The nation’s dwindling productive class, meanwhile, will get even smaller since we’re already seeing evidence that investors and entrepreneurs are going to escape to other nations with less punitive tax regimes.

I joked last month that Obama would never be able to make America as socialist as France, and Hollande is confirming that tongue-in-cheek prediction with his crazy policies.

But I should state that I don’t actually want the French people to suffer. But if they elect bad people who impose bad policy, then I want to make lemonade out of lemons and at least help the rest of the world learn from their mistakes.

As my friend (and soon-to-be American citizen) Veronique de Rugy explained in a video, we don’t want America to become more like France.

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Thomas Sowell Exposes How the Left Advances Statism by Distorting Language

Even though it’s important – particularly in a world with slippery politicians – to define words and terms accurately, I haven’t focused on this issue.

Indeed, a quick search through my archives shows that the only glossary I’ve ever published was this humorous list of financial terms.

And the only dictionary I’ve ever published was this clever example of Republican-to-English humor by a leftist.

Fortunately, Thomas Sowell is taking this issue seriously and he has two columns addressing how certain words are distorted to advance a statist agenda.

Here’s some of what he writes in Part I. He starts with the elastic definition of “racism.”

“Racism” is another term we can expect to hear a lot this election year, especially if the public opinion polls are going against President Barack Obama. Former big-time TV journalist Sam Donaldson and current fledgling CNN host Don Lemon have already proclaimed racism to be the reason for criticisms of Obama, and we can expect more and more other talking heads to say the same thing as the election campaign goes on. The word “racism” is like ketchup. It can be put on practically anything — and demanding evidence makes you a “racist.”

I also like his assessment of “compassion” and “greed.”

In the political language of today, people who want to keep what they have earned are said to be “greedy,” while those who wish to take their earnings from them and give it to others (who will vote for them in return) show “compassion.”

But my favorite from Part I is “hungry.”

A political term that had me baffled for a long time was “the hungry.” Since we all get hungry, it was not obvious to me how you single out some particular segment of the population to refer to as “the hungry.” Eventually, over the years, it finally dawned on me what the distinction was. People who make no provision to feed themselves, but expect others to provide food for them, are those whom politicians and the media refer to as “the hungry.” Those who meet this definition may have money for alcohol, drugs or even various electronic devices. And many of them are overweight. But, if they look to voluntary donations, or money taken from the taxpayers, to provide them with something to eat, then they are “the hungry.” I can remember a time, long ago, when I was hungry in the old-fashioned sense. I was a young fellow out of work, couldn’t find work, fell behind in my room rent — and, when I finally found a job, I had to walk miles to get there, because I couldn’t afford both subway fare and food. But this was back in those “earlier and simpler times” we hear about. I was so naive that I thought it was up to me to go find a job, and to save some money when I did. Even though I knew that Joe DiMaggio was making $100,000 a year — a staggering sum in the money of that time — it never occurred to me that it was up to him to see that I got fed.

Now let’s shift to Part II of Sowell’s glossary, which focuses on the meaning of “access.”

Politicians seem to be forever coming to the rescue of people who have been denied “access” to credit, college or whatever. But what does that mean, concretely? …To take a personal example, Michael Jordan became a basketball star — and a very rich man. I did neither. Was that because I was denied “access” to professional basketball? Anyone who saw me as a teenager trying to play basketball could tell you that I was lucky to hit the back board, much less the basket.

Sowell explains why this debate matters.

When statistics showed that blacks were turned down for conventional mortgage loans at twice the rate of whites, that was the clincher for those saying that “access” was the problem and that racial discrimination was the reason. Since this fit the existing preconceptions in many quarters, what more could you want? Other statistics, however, showed that whites were turned down for conventional mortgage loans at nearly double the rate for Asian Americans. By the very same reasoning, that would suggest that whites were being racially discriminated against by banks that were mostly run by whites. …Statistics on the average credit ratings of people in different racial groups likewise seldom saw the light of day. The average credit ratings of whites were higher than the average credit ratings of blacks, and the average credit ratings of Asian Americans were higher than the average credit ratings of whites. But to lay all these facts before the public and say, “We report, you decide” might well result in the public’s deciding that banks and other financial institutions prefer lending to individuals who were more likely to pay them back.

Fans of Professor Sowell can read more of his work here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, and here. And you can see him in action here. A truly gifted public intellectual and (thankfully) a prolific writer.

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President Bush’s Pro-Marriage Spending Programs: Another Failure of Big Government

Statism is a bad idea, regardless of which political party is promoting bigger government. And it’s a really bad idea when people who should know better decide to increase the burden of government spending.

Consider, for example, the supposedly pro-marriage programs adopted last decade by Republicans. It turns out that millions of dollars were wasted and there was no positive impact on relationships.

Here are some excerpts from a story in Mother Jones.

With congressional Republicans beating the drum about profligate and wasteful government spending, they may want to take a hard look at a federal program pushed by a host of top GOPers during the Bush-era… Originally championed by Republican lawmakers including Iowa Sen. Chuck Grassley, former Pennsylvania Sen. Rick Santorum, and current Kansas Gov. Sam Brownback, a federal initiative to promote marriage as a cure for poverty dumped hundreds of millions of dollars into programs that either had no impact or a negative effect on the relationships of the couples who took part, according to recent research by the Department of Health and Human Services (HHS). …Starting in 2006, millions of dollars were hastily distributed to grantees… The money went to such enterprises as “Laugh Your Way America,” a program run by a non-Spanish speaking Wisconsin minister who used federal dollars to offer “Laugh Your Way to a Better Marriage” seminars to Latinos. It funded Rabbi Stephen Baars, a British rabbi who’d been giving his trademarked “Bliss” marriage seminars to upper-middle-class Jews in Montgomery County, Maryland, for years. …when the federal government started dumping million of poverty dollars into marriage education, there was virtually no research on how such programs would fare with poor, inner-city single moms. Now, though, the data is in, and it doesn’t look good for proponents of taxpayer funded marriage education. This month, HHS released the results of several years of research about the performance of the marriage programs, and it indicates that the Bush-era effort to encourage Americans (straight ones, at least) to walk down the aisle has been a serious flop. …Take the Building Healthy Families program…, couples in the eight pilot programs around the country actually broke up more frequently than those in a control group who didn’t get the relationship program. The program also prompted a drop in the involvement of fathers and the percentage who provided financial support.

Isn’t that wonderful? Taxpayers are financing programs that undermine marriage. Not that we should be surprised by that results. The federal government declared a “War on Poverty” and wound up increasing dependency and destitution.

And even when researchers found results that vaguely could be interpreted in a positive fashion, the cost was absurd.

…married couples who participated in a government-funded relationship class reported being somewhat happier and having slightly warmer relationships with their partners. But the cost of this slight bump in happiness in the Supporting Healthy Marriage program was a whopping $7,000 to $11,500 per couple. Imagine how much happier the couples would have been if they’d just been handed with cash.

One would hope that this evidence of government failure would motivate GOPers to eliminate this example of waste. But I wouldn’t recommend holding your breath until that happens.

Given the underwhelming track record of the federal marriage program, it would seem a ripe target for GOP budget hawks, especially given that many of the original proponents of the program are no longer in Congress to defend it. Instead, in November 2010, Congress allocated another $150 million for healthy marriage and fatherhood related programs, with another $150 million budgeted for 2013. And this fall HHS doled out $120 million worth of grants.

What really irks me is that a former Bush Administration official defends the marriage handouts because we waste even more money on a Head Start program that doesn’t produce good results.

Ron Haskins, a marriage program supporter who is a former adviser to Bush on welfare issues and a senior fellow at the Brookings Institution, thinks Obama did the right thing. He points out that research on poverty programs beloved by liberals, such as Head Start, doesn’t look so good either, but that doesn’t mean the government should simply get rid of it. “When there’s tremendous pressure on the budget, there is a reason for reducing the spending,” he says. “The exception is, if it’s a new program you ought to try to figure out if you can improve it.” Haskins notes that in the grand scheme of the federal budget, the marriage program is but a blip. “We don’t spend a lot of money on these programs. [We spend] $7 billion on Head Start, but not even a $100 million on these [marriage] programs.”

I realize this is heresy in Washington, but what would be wrong with saying, “Neither marriage programs nor Head Start generate positive results, so let’s get rid of both and save $7.1 billion.”

No wonder we’re likely going to be another Greece in just a few decades.

P.S. I shouldn’t have to write this (especially since I’ve already explained my socially conservative inclinations), but allow me to deflect foolish attacks by saying that being against federal programs to subsidize marriage doesn’t make me anti-marriage. I like softball, apple pie, chocolate milk shakes, and the Georgia Bulldogs football team, but I don’t want the federal government subsidies for any of those things either. Indeed, I fear subsidies and handouts will have a negative impact.

P.P.S. The conservatives who support these programs are making the mistake of legislating based on good intentions. They correctly understand that stable marriages are a good thing (as Walter Williams has explained, an intact family is a sure-fire way of avoiding poverty if accompanied by a high school education, any sort of job, and obeying the law), but they erroneously jump to the conclusion that a good thing can be made better with money from the federal government.

P.P.P.S. Conservatives who want stronger marriages and healthier families should concentrate on ending the pernicious welfare handouts that, for all intents and purposes, replace fathers with government programs. I won’t pretend that’s a full solution because it’s not easy to put toothpaste back in a tube, but it can’t hurt given the strong correlation between the growth of the welfare state and the decline in stable low-income families.

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Obama’s Using Our Tax Dollars to Leverage More Food Stamp Dependency

In past posts, I’ve groused about food stamp abuse, including people using them to buy luxury coffee at Starbucks and to purchase steaks and lobster. I’ve complained about college kids scamming the program, the “Octo-Mom” mooching off the program, and the Obama Administration rewarding states that sign up more food stamp recipients.

Well, the Obama White House is doubling down on creating more dependency, spending tax dollars to increase the number of people on food stamps.

Here are some of disturbing details from a CNN report.

More than one in seven Americans are on food stamps, but the federal government wants even more people to sign up for the safety net program. The U.S. Department of Agriculture has been running radio ads for the past four months encouraging those eligible to enroll. …The department is spending between $2.5 million and $3 million on paid spots, and free public service announcements are also airing. The campaign can be heard in California, Texas, North Carolina, South Carolina, Ohio, and the New York metro area. …President Bush launched a recruitment campaign, which pushed average participation up by 63% during his eight years in office. The USDA began airing paid radio spots in 2004. President Obama’s stimulus act made it easier for childless, jobless adults to qualify for the program and increased the monthly benefit by about 15% through 2013.

Last year, I semi-defended Newt Gingrich when he was attacked for calling Obama the “Food Stamp” President. Citing this chart, I wrote that, “It certainly looks like America is becoming a food stamp nation.”

But my bigger point is that welfare is bad for both taxpayers and the people who get trapped into relying on big government.

The ideal approach, as explained in this video, is to get the federal government out of the business of redistributing income. We are far more likely to get better results if we let states experiment with different approaches.

House Republicans, to their credit, already want to do this with Medicaid. So why not block grant all social welfare programs?

The icing on the cake is that no longer would the federal government be running ads to lure people into dependency.

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The Left-Wing Mind, Captured by a Cartoon

What motivates folks on the left? For some, it’s a simple matter of self interest. They belong to a group that benefits from favoritism or redistribution. Or, as Mark Steyn has explained, they want to create dependency for short-run political self interest.

For others, it’s probably a go-along-to-get-along strategy. If you work in Hollywood, your life is easier if you adopt the dominant belief system, even if you privately think it doesn’t make sense.

And don’t forget the folks on the left who assume that wealth is the result of some sort of scam (often because the rich people they know “earned” their money in less-then-impressive ways).

But what about ordinary leftists? Why do they support statist policies. My own personal guess is that they think good intentions make them good people, and they naively assume that spending other people’s money is a way of solving problems (which is the most charitable interpretation of FDR’s policies).

This Chuck Asay cartoon expresses this mindset.

You can enjoy other Asay cartoons here, here, here, here, here, and here.

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On Reason TV, Andrew Ferguson Discusses the Parasite Economy of Washington, DC

Back in February, I posted this startling map showing that 10 of America’s 15-richest counties are the bedroom communities surrounding Washington, DC.

There’s a lot of money in Washington because federal bureaucrats are wildly overpaid, as I document in this video, and also because there is a huge shadow workforce of contractors, consultants, and lobbyists who have their snouts buried deeply in the public trough.

In an interview for Reason TV, Andy Ferguson talks about how these well-paid parasites have created a bubble economy in Washington.

And you know it must be true because even the leftists at Politico wrote a story acknowledging how the DC area was thriving at a time when the rest of America was struggling.

In other words, the poor and middle-class people in the real world are paying high taxes to subsidize the indolent moochers of Washington.

You would think that’s one kind of redistribution that the left would oppose. Heck, it’s almost enough to make you think that it would be a good idea to reduce the size and scope of the federal government.

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George Will Trashes the Law-of-the-Sea Treaty

International agreements are not necessarily bad. There’s probably some sort of treaty about air traffic control rules as planes cross national borders, and even I can’t think of a reason to get worried about such a pact.

But that would be the exception that proves the rule. International treaties usually are bad because they are vehicles for governments to engage in cartel-like behavior. The Paris-based OECD’s so-called Multilateral Convention on Mutual Administrative Assistance in Tax Matters, for instance, is designed to become an International Tax Organization – controlled by high-tax nations that want to stifle tax competition.

Another example is the Law of the Sea Treaty (LOST), which George Will eviscerates in his Washington Post column.

There they go again. Like those who say climate change is an emergency too obvious and urgent to allow for debate, some proponents of the United Nations Convention on the Law of the Sea, a.k.a. the Law of the Sea Treaty (LOST), say arguments against it are nonexistent. Secretary of State Hillary Rodham Clinton says any such arguments “no longer exist and truly cannot even be taken with a straight face.” …Clinton’s insufferable tone is not a reason for the necessary 34 senatorsto reject ratification. It is, however, a reason for enjoying their doing so. …For centuries there has been a law of the sea. There might be marginal benefits from LOST’s clarifications and procedures for resolving disputes arising from that law — although China and the nations involved in contentious disputes about the South China Sea have all ratified LOST, not that it seems to matter. But those hypothetical benefits are less important than LOST’s actual derogation of U.S. sovereignty by empowering a U.N. bureaucracy — the International Seabed Authority (ISA), based in Jamaica — to give or withhold permission for mining, and to transfer perhaps hundreds of billions of dollars of U.S. wealth to whatever nation it deems deserving — “on the basis of equitable sharing criteria, taking into account the interests and needs of developing states, particularly the least developed and the land-locked among them.” Royalties paid by nations with the talent and will for extracting wealth from the seabed will go to nations that have neither, on the principle that what is extracted from 56 percent of the earth’s surface is, the United Nations insists, “the common heritage of mankind.” And never mind U.S. law, which says that wealth gained from the continental shelf — from which the ISA would seek royalty payments — is supposed to be held by the U.S. government for the benefit of the American people. …Donald Rumsfeld…opposes LOST because it “remains a sweeping power grab that could prove to be the largest mechanism for the worldwide redistribution of wealth in human history.” It “would regulate American citizens and businesses without being accountable politically to the American people.” Which makes it shameful that the Chamber of Commerce is campaigning for LOST through an organization with the Orwellian name the American Sovereignty Campaign. If the Navy supports LOST because the civilian leadership does, fine. But if the Navy thinks it cannot operate well without LOST, we need better admirals, not better treaties. Here is an alternative proposal for enhancing the lawfulness of the seas: Keep the money LOST would transfer to ISA, and use it to enlarge the Navy.

That’s a long excerpt, but that’s because the whole piece is worth reading.

I particularly enjoy his dig at the Chamber of Commerce, which endorsed the TARP bailout and the faux stimulus and is building upon that record of failure by supporting a treaty that would undermine American companies. I know I’m being unfair since they’re sometimes on the right side, but the term “useful idiots” comes to mind.

But that’s a digression. Global governance is a very bad idea. It is pro-statism and anti-democratic. And in the case of LOST, it’s an excuse to redistribute money from America to the rest of the world.

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We’re Sending Tax Dollars to a Paris-Based International Bureaucracy So It Can Work with “Occupy” Nutjobs to Push for Higher Taxes

I’m not a big fan of the Organization for Economic Cooperation and Development. This Paris-based international bureaucracy doesn’t get as much attention as the United Nations or International Monetary Fund, but it’s probably does more damage to freedom and prosperity if measured on a per-dollar-spent basis.

For instance:

• The OECD, in an effort to promote redistributionism, has concocted absurdly misleading statistics claiming that there is more poverty in the US than in Greece, Hungary, Portugal, or Turkey.
• The OECD is pushing a “Multilateral Convention” that is designed to become something akin to a World Tax Organization, with the power to persecute nations with free-market tax policy.
• The OECD has endorsed Obama’s class-warfare agenda, publishing documents endorsing “higher marginal tax rates” so that the so-called rich “contribute their fair share.”

But now I’ve come across something that is bizarrely reprehensible. The bureaucrats in Paris are allying themselves with the cranks, buffoons, and totalitarians from the so-called Occupy movement.

In the bureaucracy’s quarterly magazine, the OECD Observer, one of the Occupy clowns was given a platform to promote more statism. The poorly written article is mostly filled with empty clichés and “change” and “challenges,” but it does specifically embrace the OECD’s anti-tax competition project as a tool to promote higher taxes and more redistributionism.

In OECD member countries, a grassroots movement has manifested itself in the overnight occupation of public space and the exercise of direct democracy… The first lesson to draw from Occupy is that civil society has the scope to be a dynamic force for change. …In London these efforts produced statements on corporations, economics, the environment and local government within weeks. …We all know that we face profound challenges in the way we organise our economies, our societies and our government. …There’s a reason why “We are the 99%” has become such a rallying cry. There are external threats to democratic governance too, and some of these may need to be tackled anew on an international scale. Tax havens and secrecy jurisdictions bring governments into a harmful race to the bottom that is against their population’s interests. They are a major driver of inequality, which we know correlates to poor health and social outcomes. The OECD has played an important role in drawing policymakers’ attention to these issues, but those efforts now need to be stepped up.

If you want the specific arguments about why tax competition and tax havens are desirable, I urge you to peruse the work of Allister Heath and Pierre Bessard.

The main purpose of this post, though, is to ask why American taxpayers are sending about $100 million each year to Paris to subsidize the OECD’s left-wing agenda? This video has more details.

Here are a few additional blurbs about OECD activities that are being financed with your tax dollars.

• The OECD has an anti-tax competition project designed to prop up Europe’s bankrupt welfare states.
• The OECD pulled off a hat trick of bad policy in a 2010 document, promoting a value-added tax, Obama’s global warming agenda, and failed Keynesian stimulus.
• The OECD endorsed Obamacare policies, as I explain in this video.
• The OECD even advocates higher taxes when nations are in the middle of economic crisis.
• The OECD also is pushing for higher taxes in Latin America, based on the odd notion that those nations should copy Europe’s failed welfare states.

The analogy isn’t perfect, but funding the OECD is the international version of subsidizing ACORN. A way for the left to use our money to push their agenda.

Which is why I’ve argued that the GOP – if it is serious about its claim of fiscal responsibility – should immediately end handouts for the Paris-based bureaucrats.

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New Jokes about the Idiots in Washington

There are classes of people in America that are more reprehensible than politicians. Child molesters, for instance. And I’m sure if I thought about it for a few more days, I could augment that list.

So let’s have some fun mocking these jerks, and if they complain, we should remind them that they’re lucky that we don’t copy other nations and put them on trial for economic negligence.

My favorite joke in this bunch is the one about Putin from Craig Ferguson. Reminds me of this Castro joke by Leno.

Jay Leno

• It was 100 degrees in New York City. It was so hot, you know Solyndra, the solar company? They actually made money.
• It was so hot, Attorney General Eric Holder was selling water guns to Mexican drug gangs.
• According to federal reports filed yesterday, the Obama campaign spent more money than they raised in the month of May. They spent more money than they raised? Well, that’s called being a Democrat
• There is a record heat wave back east, close to 100 degrees in New York City. The temperatures are higher than President Obama was in high school.
• In Chicago some anti-Mitt Romney protesters told reporters they’re being paid to protest. They said they’re being paid by Democrats to stand outside and chant anti-Romney slogans. Well, who says President Obama isn’t creating any new jobs?
• For the first time ever, Asians are immigrating to this country more than any other minority group. But unlike other groups, Asian immigrants are just here to do the jobs Americans aren’t smart enough to do.
• Our space probe, Voyager 1, launched back in 1977, is 11 billion miles in space. It’s on the verge of leaving our solar system on its mission to find other civilizations to try and borrow money from.
• President Obama spent about four hours on Father’s Day playing golf at a country club in Chicago. It was his 100th round of golf since taking office. He’s played more golf than Tiger Woods in the last four years.
• Actually, Obama’s staff is a little concerned. They’re concerned all this golf is cutting into his fund-raising.
• President Obama is going to let certain illegal immigrants stay in this country. But there is an age requirement. You have to be old enough to vote by November.
• There was a report in the paper today that the city of Detroit will go broke in two weeks. Are you surprised by that? Didn’t you think Detroit went broke, like, 10 years ago?
• Republican Senator John McCain and Democrat Harry Reid have called for the federal government to step in and help regulate the sport of boxing. Is that a good idea — something so corrupt and unethical attempting to regulate something so corrupt and unethical?
• Guantanamo Bay is getting millions and millions of dollars of upgrades and renovations. In fact, they’re not even calling it a detention camp anymore. It’s now a gated community.
• Pundits are saying that President Obama is starting to lose support among his own party. To give you an idea of how bad it’s gotten, today Jimmy Carter compared him to Jimmy Carter.
• Guantanamo Bay is now undergoing millions of dollars worth of renovations, including a new soccer field, cable TV, and better housing. Which is kind of ironic. The only people who say they’re better off today than they were four years ago are the inmates at Guantanamo Bay.
• CNBC is reporting that America lost 129,000 millionaires last year. Or as Mitt Romney calls them, “an endangered species we have to protect.”
• Former Egyptian leader Hosni Mubarak has been sentenced to life in prison. You know, it’s too bad we couldn’t get the John Edwards trial moved to Egypt.

David Letterman

• By the way, when you buy the ticket for the new Abe Lincoln vampire movie, all of the facts and activities in the movie have been authenticated by historian Doris Kearns Goodwin.
• Hey, guess who’s gay? The Green Lantern from the comic books. Today Mitt Romney knocked him down and shaved his head.

Conan

• Mitt Romney has accused President Obama of pandering to the Latino community. The president said he’s too busy to comment because he’s watching Telemundo and eating chalupas.
• Over the weekend President Obama issued an order that allows some illegal immigrants to stay in the country. Or as Fox News reported it, “Obama issues order allowing himself to stay in the country.”
• President Obama is coming to Chicago this weekend. Obama is introducing his new economic plan as part of the Just For Laughs Festival.
• It’s great to be back in Chicago. Illinois Rep. Derek Smith has been accused of accepting a $7,000 bribe. If he’s found guilty, he could serve up to four years as the state’s governor.
• The last time I did a late-night show in Chicago, my guest was an up-and-coming senator called Barack Obama. And now just six short years later, he’s gone on to become a socialist Muslim from Kenya.

Jimmy Fallon

• A new survey found that only 31 percent of Americans would want to sit next to Mitt Romney on a flight. Romney was so upset, he was like, “I don’t understand. How would they get on my private jet?”
• Today President Obama used his executive privileges to withhold documents about the weapons operation called Fast and Furious. I don’t know what’s scarier — that we can’t see those documents or that the government is naming operations after Vin Diesel movies.
• Yesterday, President Obama played his 100th round of golf since taking office. You could tell it was Obama, because he finished about 14 trillion over par.
• A new study found that Republicans are more likely to go to Dunkin’ Donuts, while Democrats are more likely to get their breakfast at Starbucks. While Governor Chris Christie takes the bipartisan route and gets a breakfast from each.
• Today President Obama gave a major speech where he defended his handling of the economy. And there were tons of people in the audience, you know, since nobody had to be at work.
• Mitt Romney visited a restaurant in Iowa, and had trouble thinking of the word for doughnut. Newt Gingrich merely responded, “That never would have happened if I were the nominee.”
• A new report found that Mitt Romney’s economic plan would not have any effect on unemployment. When he heard that Romney’s plan wouldn’t make any difference, Obama was like, “Hey, that’s MY thing!”
• Mitt Romney has been giving his volunteers a free sweatshirt for making phone calls on his behalf. The sweatshirts are just like Romney, 100 percent reversible.
• A new survey found that Mitt Romney is ahead of Obama among those who make $36,000-$90,000. Or as Romney put it, “And they said I can’t connect with the poor.”

Jimmy Kimmel

• For the first time in history, the number of Asian immigrants coming into America is larger than the number of Hispanic immigrants. Now even our immigrants are being made in China.

Craig Ferguson

• It’s a great day for our president. He’s down in Mexico for the G-20 Summit. Today he met with Russia’s Vladimir Putin. He said “I think your communist policies are a danger to the world.” There’s no word on how Obama responded.
• The original “Dallas” series started in 1978. Back then, America was very different. We had an ineffective, one-term president. Gas prices were through the roof. We were in a stand-off with Iran. I’m glad those dark days are over.

You can see previous collections of late-night jokes by clicking here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, and here.

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The “Remain-Calm-All-Is-Well” Image of the European Crisis

Yesterday, I did a serious post outlining the absurd policies being pursued in France, Italy, and Greece, along with some much-deserved scorn for the throw-fuel-on-the-fire statist analysis of the International Monetary Fund.

Later in the day, I posted a cartoon about Greece and also included links to other amusing posts about the mess across the ocean.

Well, here’s something that is sort of in between those two posts. It makes a serious point, but in a mocking fashion. Sort of reminds me of the Kevin Bacon line – “Remain calm, all is well!” – from that great movie Animal House.

I especially like the comment from the Ugandan Foreign Minister. Who would have guessed that dozens of third world nations now have better credit ratings than their former colonial masters?

More seriously, the supporters of statism in Europe want everyone to blindly accept their assurances that the welfare state is in good shape and that problems caused by excessive government in one nation surely won’t mean similar problems in other nations with excessive government.

But these clowns never learn. Just yesterday, a bunch of European politicians announced a “growth” plan. Did this mean they were cutting taxes, or perhaps even implementing flat tax reforms? Did this mean slashing the burden of red tape? What about pension reform? Or cutting back the burden of government spending?

Of course not. As the EU Observer reports, they’re going to squander more money.

A high-profile meeting of the eurozone’s biggest economies on Friday (22 June) saw commitment to boost growth by adopting measures worth €130 billion… “The first objective we agree on is to relaunch growth, investments and to create jobs,” said Italian leader Mario Monti after meeting his counterparts from France, Germany and Spain. “We want there to be a significant European growth package, that is worth about 1 percent of Gross Domestic Product (GDP), or €130 billion,” he added.

And just to confirm that they are utterly clueless about the real world, the Four Amigos of Statism also endorsed a giant new tax on their shaky banking systems.

The four also declared themselves in favour of a financial transactions tax. French President Francois Hollande pledged to get such a levy off the ground as soon as possible. But there are multiple technical and legal questions. Only a few member states want to go ahead with the tax, and even these differ on the details.

To paraphrase Churchill, never have so few done so much damage to the detriment of so many. I’m sure more spending and more taxes will work wonders for Europe.

I just hope the remaining good people of Europe manage to get hold of plenty of guns and ammunition. As I explained in this interview for NRA-TV, they’ll need to be well armed when there’s a societal breakdown and Europe descends into some sort of Mad Max Dystopia.

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The European Mess, Captured by a Cartoon

The self-inflicted economic crisis in Europe has generated some good humor, as you can see from these cartoons by Michael Ramirez and Chuck Asay.

But for pure laughter, I don’t think anything will ever match the hilarious “Europe According To…” maps that I posted last year.

That being said, this new cartoon by Robert Ariail ranks high on my list for European humor.

And if you need some more European-oriented laughs, I also recommend this photo-shopped image of “Merkozy” and this Hitler parody about the downgrade.

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Europe’s Self-Inflicted Decline: French Taxing, Italian Regulating, Greek Mooching, and IMF Economic Illiteracy

Every day brings more and more evidence that Obamanomics is failing in Europe.  I wrote some “Observations on the European Farce” last week, but the news this morning is even more surreal.

Compared to his foolishness on tax policy, Hollande is a genius when it comes to determining what time it is.

Let’s start with France, where I endorsed the explicit socialist over the implicit socialist precisely because of a morbid desire to see a nation commit faster economic suicide. Well, Monsieur Hollande isn’t disappointing me. Let’s look at some of his new initiatives, as reported by Tax-News.com.

The French Minister responsible for Parliamentary Relations Alain Vidalies has recently conceded that EUR10bn (USD12.7bn) is needed to balance the country’s budget this year, to be achieved notably by means of implementing a number of emergency tax measures. …The government plans to abolish the exemption from social contributions applicable to overtime hours, expected to yield a gain for the state of around EUR3.2bn, and to subject overtime hours to taxation, predicted to realize approximately EUR1.4bn in additional revenues. Other proposed measures include plans to reform the country’s solidarity tax on wealth (ISF), to cap tax breaks at EUR10,000, to impose a 3% tax on dividends and to increase inheritance tax as well as the tax on donations. …French President Hollande announced plans during his election campaign to reform ISF. Holland intends to restore the wealth tax scale of between 0.55% and 1.8%, in place before the former government’s 2011 reform, to be applied on wealth in excess of EUR1.3m. Currently a 0.25% rate is imposed on net taxable wealth in excess of EUR1.3m and 0.5% on net taxable assets above EUR3m.

France already has the highest tax burden of any non-Scandinavian nation, so why not further squeeze the productive sector. That’s bound to boost jobs and competitiveness, right? And more revenue as well!

In reality, the Laffer Curve will kick in because France’s dwindling productive class isn’t going to passively submit as the political jackals start looking for a new meal.

But while France is driving into a fiscal cul-de-sac, Italian politicians have constructed a very impressive maze of red tape, intervention, and regulation. From the Wall Street Journal, here is just a sampling of the idiotic rules that paralyze job creators and entrepreneurs.

Once you hire employee 11, you must submit an annual self-assessment to the national authorities outlining every possible health and safety hazard to which your employees might be subject. These include work-related stress and stress caused by age, gender and racial differences. …Once you hire your 16th employee, national unions can set up shop, and workers may elect their own separate representatives. As your company grows, so does the number of required employee representatives, each of whom is entitled to eight hours of paid leave monthly to fulfill union or works-council duties. …Hire No. 16 also means that your next recruit must qualify as disabled. By the time your firm hires its 51st worker, 7% of the payroll must be handicapped in some way, or else your company owes fees in kind. …Once you hire your 101st employee, you must submit a report every two years on the gender-dynamics within the company. This must include a tabulation of the men and women employed in each production unit, their functions and level within the company, details of their compensation and benefits, and dates and reasons for recruitments, promotions and transfers, as well as the estimated revenue impact. …All of these protections and assurances, along with the bureaucracies that oversee them, subtract 47.6% from the average Italian wage, according to the OECD. …which may explain the temptation to stay small and keep as much of your business as possible off the books. This gray- and black-market accounts for more than a quarter of the Italian economy. It also helps account for unemployment at a 12-year high of 10%, and GDP forecast to contract 1.3% this year.

You won’t be surprised to learn that the unelected Prime Minister of Italy, Mr. Monti, isn’t really trying to fix any of this nonsense and instead is agitating for more bailouts from taxpayers in countries that aren’t quite as corrupt and strangled by red tape.

Monti also is a big supporter of eurobonds, which make a lot of sense if you’re the type of person who likes co-signing loans for your unemployed alcoholic cousin with a gambling addiction.

But let’s not forget our Greek friends, the one from the country that subsidizes pedophiles and requires stool samples from entrepreneurs applying to set up online companies.

The recent elections resulted in a victory for the supposedly conservative party, so what did the new government announce? A flat tax to boost growth? Sweeping deregulation to get rid of the absurd rules that strangle entrepreneurship?

You must be smoking crack to even ask such questions. In addition to whining for further handouts from taxpayers in other nations, the Wall Street Journal reports that the new government has announced that it won’t be pruning any bureaucrats from the country’s bloated government workforce.

Greece’s new three-party coalition government on Thursday ruled out massive public-sector layoffs, a move that could help pacify restive trade unions… The new government’s refusal to slash public payrolls and its demands to renegotiate its loan deal comes just as euro-zone finance ministers meet in Luxembourg to discuss Greece’s troubled overhauls—and possibly weigh a two-year extension the new government is seeking in a bid to ease the terms of the austerity program that has accompanied the bailout. …Cutting the size of the public sector has been a top demand by Greece’s creditors—the European Union, European Central Bank and International Monetary Fund—to reduce costs and help Greece meet its budget-deficit targets needed for the country to get more financing. So far, Greece has laid off just a few hundred workers and failed to implement a so-called labor reserve last year, which foresaw slashing the public sector by 30,000 workers.

Gee, isn’t this just peachy. Best of all, thank to the International Monetary Fund, the rest of us are helping to subsidize these Greek moochers.

And speaking of the IMF, I never realized those overpaid bureaucrats (and they’re also exempt from tax!) are closet comedians. They must be a bunch of jokers, I’ve concluded, because they just released a report on problems in the eurozone without once mentioning excessive government spending or high tax burdens.

The tax-free IMF bureaucrats do claim that “Important actions have been taken,” but they’re talking about bailouts and easy money.

The ECB has lowered policy rates and conducted special liquidity interventions to address immediate bank funding pressures and avert an even more rapid escalation of the crisis.

And even though the problems in Europe are solely the result of bad policies by nations governments, the economic pyromaniacs at the IMF also say that “the crisis now calls for a stronger and more collective effort.”

Absent collective mechanisms to break these adverse feedback loops, the crisis has spilled across euro area countries. Contagion from further intensification of the crisis—including acute stress in funding markets and tensions involving systemically-important banks—would be sizeable globally. And spillovers to neighboring EU economies would be particularly large. A more determined and forceful collective response is needed.

Let’s translate this into plain English: The IMF wants more money from American taxpayers (and other victimized producers elsewhere in the world) to subsidize the types of statist policies that are described above in places such as France, Italy, and Greece.

I’ve previously explained why conspiracy theories are silly, but we’ve gotten to the point where I can forgive people for thinking that politicians and bureaucrats are deliberately trying to turn Europe into some sort of statist Dystopia.

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Notwithstanding David Cameron’s Statolatry, Tax Avoidance Is Both Legal and Moral

I’m not a fan of David Cameron, the United Kingdom’s Prime Minister.

Even though he belongs to the Conservative Party that produced the great Margaret Thatcher, Cameron seems to be a bit of guilt-ridden statist with his finger always in the air to see which way the wind is blowing. The policy results are not pretty.

• Cameron has undermined the U.K.’s system of personal retirement accounts.
• Cameron is giving taxpayer money to statist environmental groups.
• Cameron has increased the capital gains tax.
• Cameron is increasing the burden of government spending.

Now I have another reason to dislike Cameron. He just condemned a comedian for legally seeking to minimize the amount of his income that is seized – and then wasted – by the U.K. government. Here are some of the details from The Telegraph.

Prime Minister David Cameron today branded the tax arrangement of comedian Jimmy Carr “morally wrong” after it emerged he was using a scheme which allows the wealthy to pay as little as one per cent of their income. …Speaking at the G20 summit the Prime Minister told ITV News: “I think some of these schemes – and I think particularly of the Jimmy Carr scheme – I have had time to read about and I just think this is completely wrong. “People work hard, they pay their taxes, they save up to go to one of his shows. They buy the tickets. He is taking the money from those tickets and he, as far as I can see, is putting all of that into some very dodgy tax avoiding schemes. …some of these schemes we have seen are quite frankly morally wrong.” …Lawyers for the comedian have…categorically denied any wrongdoing, saying the scheme had been disclosed to the relevant authorities in line with the law. …Chancellor George Osborne has claimed he was left “shocked” after finding the extent to which multi-millionaires were exploiting tax loopholes and vowed to take “action”.

 I have no idea whether the specific “tax avoiding scheme” used by Carr is good tax policy (protecting against double taxation, for instance) or bad policy (such as a loophole that creates favoritism for a specific behavior), but that’s not the point of this post.

Instead, this is a moral question about whether people have some sort of obligation to pay extra tax, merely to get some sort of pat on the head from politicians. The same politicians, by the way, that squander the money on varying vote-buying schemes that undermine prosperity and create dependency.

I’d be willing to condemn Carr if I found out he’s some sort of statist who wants higher taxes for everybody else, but then (like John Kerry) takes steps to minimize his personal tax bill.

But I’d be condemning Carr for hypocrisy, not criticizing the idea of tax avoidance.

The United Kingdom has become a bloated welfare state (with horribly depressing implications, as you can read here and here). If people want to be moral, they should strive to pay the least amount possible to this corrupt and wasteful enterprise. The United States is not quite as bad (yet), but the same principle applies.

Politicians, needless to say, will violently disagree with this ethical viewpoint. So we can all expect more taxes, higher taxes, and additional draconian enforcement measures.

The only good news is that the Laffer Curve will prevent these greedy thugs from collecting nearly as much money as they think.

P.S. To get an idea of how the Conservative Party has declined, compare Cameron’s statist rhetoric to Margaret Thatcher’s comments that “there is no such thing as public money.”

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The Legal Case Against Obamacare

I’ve narrated a video on the fiscal nightmare of Obamacare and written several times about the serious problem of government-caused third-party payer – including just as few days ago while nit-picking about an otherwise excellent column by Robert Samuelson (and I’ve even used the abortion market to make the point that prices don’t rise when consumers are spending their own money).

But, other than mocking E.J. Dionne’s sophomoric understanding of America’s political system and making a general point about how the judicial branch is supposed to protect us from untrammeled majoritarianism, I haven’t said much about the constitutional issues being discussed at the Supreme Court.

Simply stated, I’m not a lawyer or an expert on the Constitution, so I try not to pontificate too much where my knowledge is lacking. Fortunately, though, I can turn to others who are competent to discuss such matters, and this new Learn Liberty video is a great introduction to the key issue that the Justices must decide.

Seems pretty straightforward. For all intents and purposes, the Justices are being asked to decide whether the Founding Fathers were serious when the outlined the limited powers of the federal government.

Let’s all keep our fingers crossed that the Court will imminently announce that the entire law is unconstitutional.

P.S. The Learn Liberty videos are superb. Here’s one on protectionism and here’s another about how excessive federal spending is America’s real fiscal problem.

P.P.S. Just in case the Court makes the wrong decision, here’s some Obamacare humor to cheer you up, including one on a new medical device the Administration is introducing, a cartoon about the real impact of the new health system, an R-rated explanation of the difference between private health care and government health care, the White House’s new motto for Obamacare, and (ouch!) a look at vasectomies once the government is in charge.

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Time to Fight Statism by Shutting Down the G-20

For the most part, international summits like the recently concluded G-20 meeting in Mexico are pointless – but expensive – publicity stunts for incumbent politicians.

They pose for photo-ops, have boring meeting, and draft up empty communiques, always at some posh location so that everybody – from bureaucrat flunkies to servile reporters – can have a good time.

But these soirees are more than just money-wasting junkets. They also encourage bad policy. With everything that’s happening around the world, the evidence is stronger than ever about the adverse economic consequences of bloated public sectors and punitive tax regimes.

But when politicians get together at gab-fests like the G-20, they inevitably push for more of the same. Here’s some of what David Malpass wrote today for the Wall Street Journal.

…the two-day G-20 summit this week—the diplomatic equivalent of speed dating—did little but drain more money from deeply indebted nations. …the “Los Cabos Growth and Jobs Action Plan” …mostly commits Europe’s struggling economies to still more government control… The clearest decisions that came out of the summit promoted governments, not private sectors, pointing to even more deficit spending, an IMF expansion led by China and another expensive G-20 meeting next year in Russia. The outcome raises fundamental doubts about the G-20’s value in furthering free markets, strong private economies and global living standards.

David goes on to note that economic problems are rooted in the bad policies of individual governments, so it is illogical to expect that they can be solved by an international summit.

The obstacles to global growth in 2012 are clear and need to be addressed in national capitals, not in summits. Europe’s policy initiatives are probably the most urgent. Europe’s growth focus should be maintaining the euro and setting up decisive mechanisms to reduce borrowing costs while governments sell assets, downsize and remove private-sector obstacles. …the leaders’ time would have been better spent in Europe hammering out the actual mechanisms. …Fast global growth is achievable, but the G-20 summits aren’t helping. Country-specific tasks—not further institutionalization of global financial governance—are the solution.

The final point about “global financial governance” is worth emphasizing. While it is true that nothing good has ever  happened because of a G-20 summit, some bad things have occurred – most notably the big push a couple of years ago to attack low-tax jurisdiction as part of a campaign by high-tax governments to cripple tax competition and facilitate higher tax burdens.

International summits also tend to be the types of gatherings where other bad policies occur, such as agreements to subsidize more bailouts by giving more money to the fiscal pyromaniacs at the International Monetary Fund.

The moral of the story is that the G-20 is a great idea…but only if you think the entire world should become more like France, Italy, Spain, and Greece.

P.S. If you’re following the mess in Europe and like humor that is a bit twisted (and R-rated), then you’ll probably enjoy this bit of “art” posted at zerohedge.

P.P.S. I also dislike international summits since the thugs at the Organization for Economic Cooperation and Development threatened to throw me in a Mexican jail for the “crime” of standing in the public lobby of a public hotel and advising low-tax jurisdictions during one of the OECD’s “global tax forums.”

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Is Investigating Steroid Use a Legitimate Function of the Federal Government?

I’m not a big fan of the federal government. It does some necessary and important things, such as national defense, but the vast majority of what goes on in Washington is for activities that either belong at the state level or in the private sector.

This is why I want to reform entitlements such as Social Security, Medicare, and Medicaid, and it’s why I want to shut down entire departments of the federal government, including Housing and Urban Development, Transportation, Education, and Agriculture,

Simply stated, I want to go back to the limited central government and constitutional republic envisioned by the Founding Fathers.

With this in mind, you can imagine how agitated I am that the clowns in Washington have decided that it’s their role to investigate possible steroid use in major league baseball. Expressing my scorn, I ranted and raved on Neil Cavuto’s show.

In addition to mocking the absurdity of the Roger Clemens situation, I tried to make an important point about the desirability of shrinking the public sector by about 75 percent, bringing the overall burden of government spending back to about 10 percent of GDP, which is where it was for much of our nation’s history.

Based on Rahn Curve research about the growth-maximizing size of government, this would lead to an economic boom.

But there’s another aspect of the Clemens situation that’s worth exploring.

My former Heritage Foundation colleague Brian McNicoll has some thoughts on the issue, explaining that leftists resent Clemens because of his success.

A related mystery is why the hearing devolved into such a bitter partisan bickering session. …But why? It’s not as if Clemens was known as some big-time conservative. …At least part of it, I think, has to do with how conservatives and liberals view people such as Clemens. Conservatives revere success. They admire self-sacrifice and discipline, and they don’t begrudge the man who parlays these into professional and financial success. They want to be like him and find ways for others to replicate his methods. Liberals believe the Roger Clemenses of the world benefit from a random and thus inherently unfair assignment of talent. They think he’s rich and famous solely because he’s big enough and strong enough to throw a baseball 95 miles per hour. Never mind that not everyone who throws 95 miles per hour has anywhere near the success of Clemens. Never mind lots of people are big enough and strong enough to throw that hard but don’t put in the work to learn the skills it takes to actually do so. Never mind the extraordinary inner strength that even Clemens’ worst detractors admit propelled him throughout his career. This explanation absolves them of all responsibility for the fact they are not Roger Clemens. It’s all luck. He’s just a guy who got wildly rich because of the random assignment of genes. Nobody can have all that ill-gotten gain and any character, so he must have done whatever they say he’s done. And since he did nothing to earn his money, we all deserve a share of it. And wouldn’t it be nice to knock a guy like that down a few pegs?

Brian’s analysis of the left-wing mind makes a lot of sense and certainly is consistent with the mentality that supports class-warfare tax policy.

P.S. Just because national defense is a legitimate function of the federal government, that doesn’t mean the Pentagon should get a blank check. Our Founders would want us to fight against wasteful military spending and needless foreign entanglements.

P.P.S. At the very end of the Cavuto segment, he thanked me for dropping what we originally planned to discuss so we could respond to the breaking news and he kindly said “that’s what makes Dan great.” If I was either braver or more immature (probably the latter), that would have been a perfect moment for me to show that I’m hip to popular culture by blurting out “that’s what she said.” Alas, forever a missed opportunity.

P.P.S. This is the second time Roger Clemens has been featured in this blog. He also made a cameo appearance in this post mocking Obama.

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What Does It Mean When Obama and His Former Top Economist both Reject Obamanomics?

To answer the question in the title, it means you need to read the fine print.

This is because we have a president who thinks the government shouldn’t confiscate more than 20 percent of a company’s income, but he only gives that advice when he’s in Ghana.

And the same president says it’s time to “let the market work on its own,” but he only says that when talking about China’s economy.

Now we have more evidence that the President understands the dangers of class-warfare taxation and burdensome government spending. At least when he’s not talking about American fiscal policy.

After the Greek elections, which saw the defeat of the pro-big government Syriza coalition and a victory for the supposedly conservative New Democracy Party, here’s some of what Politico reported.

President Barack Obama on Monday called the results of Greece’s election a “positive prospect” with the potential to form a government willing to cooperate with Europe.  “I think the election in Greece yesterday indicates a positive prospect for not only them forming a government, but also them working constructively with their international partners in order that they can continue on the path of reform and do so in a way that also offers the prospects for the Greek people to succeed and prosper,” Obama said after a meeting with the G-20 Summit’s host, Mexican President Felipe Calderon.

In other words, it’s “positive” when other nations reject big government and vote for right-of-center parties, but Heaven forbid that this advice apply to the United States.

Interestingly, it’s not just Obama who is rejecting (when talking about other nations) the welfare-state vision of bigger government and higher taxes.

Check out this remarkable excerpt from a Washington Post column by Larry Summers, the former Chairman of the President’s National Economic Council.

… it is far from clear, especially after the French election, that there is any kind of majority or even plurality support for responsible policies.

Remarkable. Larry Summers is dissing Francois Hollande and the French people by implying they want irresponsible policies, even though the Hollande’s views about Keynesian economics and soak-the-rich taxation are basically identical to the nonsense Summers was peddling while in the White House.

It’s almost enough to make you cynical about America’s political elite. Perish the thought!

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When Republicans Don’t Sell Out, Democrats Are Forced to Admit that Class-Warfare Tax Hikes Are Not the Way to Solve America’s Fiscal Crisis

When Republicans maintain a no-tax-hike position, good things happen. We saw this in 2010 when Senate GOPers held firm and Obama was forced to extend for two years all of the 2001 and 2003 tax cuts.

We’re having the same fight this year, and again Republicans (with some unfortunate exceptions) are standing strong against the President’s class-warfare tax proposals.

This approach is paying dividends, as you can see from these excerpts from a report by The Hill.

At least seven Democratic senators have declined to rule out supporting a temporary extension of the Bush-era income tax rates, breaking with party leaders who have called for letting the rates expire for people earning more than $1 million per year. That gives Senate Republicans a chance to push a temporary extension similar to the deal Minority Leader Mitch McConnell (R-Ky.) struck with President Obama in December of 2010. …Extending all income tax rates for only one year would undercut the Democratic leadership’s plan to use their imminent expiration as leverage to move Republicans to accept some tax increases.

The article also notes that many of these Democrats are willing to support higher tax rates, but only if they seduce gullible Republicans into providing political cover by also saying yes.

I touch on some of these issues in this CNBC debate with Stan Collender. We both agree that America faces short-term and long-term fiscal challenges, but a key difference is that Stan wants higher taxes to facilitate a bigger burden of government spending.

From a viewer perspective, I think this was a very good interview. Stan and I both had an opportunity to get our points across. Neither one of us tried to hog all the air time. And we both pointed out areas of disagreement. When I compare this debate to the one I posted last week, there’s no comparison.

That being said, I hope what I said was more persuasive, particularly my points about the long-term entitlement problem, the unfortunate impact of too many people being exempt from the income tax, the fact that America doesn’t suffer from inadequate taxation, the role of Bush’s reckless big-government fiscal policy, and the fact that higher taxes lead to more spending rather than lower deficits. I even got to cite Estonia’s successful spending cuts.

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Disagreeing with a Critic of Obamacare

Writing for the Washington Post, Robert Samuelson has a column on “The Folly of Obamacare.” This piece criticizes the President’s signature achievement for many good reasons, including increased uncertainty, the negative impact on job creation, rising levels of red ink, and generational unfairness.

I agree with all those complaints, but then Samuelson makes another point that rubbed me the wrong way because he’s complaining about a symptom and overlooking the underlying problem. Here’s what he wrote.

Uncontrolled health spending is the U.S. system’s main problem — and the ACA makes it worse. Spiraling health costs crowd out other government programs and squeeze wage increases by diverting compensation dollars into employer-paid insurance. Because insured people use more health services than the uninsured, the ACA (covering an estimated 30 million more) raises spending. As for the ACA’s cost-control provisions, even the government’s own actuaries don’t believe they will do much. By their latest projection, total health spending — government and private — rises from 17.9 percent of the economy (gross domestic product) in 2010 to 19.6 percent in 2021. In 1980, health care was 9 percent of GDP.

I assume all his facts are correct, but Samuelson is missing the point. The reason we have “spiraling health costs” is because of something called third-party payer. As the chart shows, nearly 90 percent of health care costs in America are financed by someone other than the consumer. And when folks get to consume with other people’s money, they have very little reason to care about costs.

In my speeches, I frequently cite myself as an example. When my kids were small and it seemed like there was an earache or sore throat every other week, I was always at the pediatrician. But I never cared about the bill because I knew my employer-provided coverage limited the out-of-pocket amount I would pay.

The same is true for the tens of millions of other Americans with health plans provided by their employers, and it’s also true for the tens of millions of Americans who use Medicare, Medicaid, or some other government program.

By the way, this is why undoing Obamacare – either legislatively or through a Supreme Court decision – doesn’t solve the problem. Third-party payer was a huge problem even before the President made the problem a bit worse with his misguided scheme.

This video explains why free-market reform is necessary to solve the problem of third-party payer.

One final point is that there are parts of our health care system where consumers still pay out-of-pocket, and you shouldn’t be surprised to learn that those are areas – such as cosmetic surgery (or even abortion) – where costs are restrained and quality keeps rising.

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Will the Economy Sink Obama in November?

At the start of the year, I predicted Obama would be reelected, largely because of my assumption that the unemployment rate would drop below 8 percent.

But my prediction on jobs is looking quite shaky, so this discussion about the economy and the election with Fox Business News is very timely.

I argued, unsurprisingly, that the economy is anemic because Obama’s been pursuing an agenda of wasteful spending and class warfare.

So if he loses, he has nobody to blame but himself.

That doesn’t mean Romney would be an improvement, especially if the warning signs are correct and he saddles the country with a value-added tax, so the American people may be tossed from one frying pan to another.

P.S. Hadley Heath may look familiar because she narrated this video about the damaging impact of welfare programs for the Center for Freedom and Prosperity.

P.P.S. On the completely separate topic of the Greek elections, I am more peeved than ever that the idiots in the media are reporting the results as a victory for the pro-bailout parties over the anti-bailout parties. That is nonsense. All the parties favored bailouts. As I wrote earlier this year, the election was a fight between parties that want no-strings bailout money and parties that at least pretend they are willing to implement reforms as a condition of getting bailout money.

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Democrats Admit their Top Goal Is Luring GOP into a Tax-Hike Trap, so Why Are some Republicans Stupidly Helping to Make that Happen?

I am sometimes at a loss for words to describe the stupidity of the Republican Party.

Let’s use an analogy to explain what I mean. Imagine you were playing a game of chess and your opponent openly stated that he wanted you to move your rook to a certain point on the board.

If your IQ was above room temperature, you would probably be suspicious that he wasn’t trying to help you win the game.

Well, the same thing happens in fiscal policy. I quoted the Hill newspaper last year when some Democrats admitted that their top political goal was to seduce the GOP into a tax increase.

Now we have more evidence.

The Democrats’ counter-strategy is a bit more subtle, but has essentially been to find ways to make it very uncomfortable for Republicans to maintain such a rigid anti-tax orthodoxy — to ultimately force Republicans to break their anti-tax pledges and badly splinter their party. That’s what the Buffett Rule is about; that why Dems insist they won’t dismantle the so-called “sequester” — big cuts to defense and even to Medicare — unless Republicans agree to tackle deficits in a balanced way, i.e. by supporting significant new tax revenues. The results have been mixed. They’ve won a small number of GOP votes here and there, and vulnerable members are nowadays more likely to trash or dismiss Grover Norquist in the press than they were last year. But at a very high level within the Democratic Party, there’s a recognition that breaking the GOP on taxes is an absolutely crucial strategic imperative for defending safety net programs over the long term.

That’s a pretty clear statement. We have folks on the left who say they want higher taxes both to prop up big government and to cause internal damage to the GOP.

So we’re now left with a rather strange puzzle. Why would any Republicans (most recently Sen. Lindsey Graham and Jeb Bush) want to help the Democrats achieve those goals?!?

Unless, of course, they’re motivated by a belief in bigger government (high likely) or a suicidal desire to harm their own electoral prospects (highly unlikely since even I don’t think GOPers are that stupid).

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Government Cost-Overruns, the English Version

Many of us know that Obamacare will be very expensive and that supporters, aided and abetted by the Congressional Budget Office, deliberately low-balled the cost estimates.

I’ve also cited my Cato colleague Chris Edwards, who has made a more comprehensive (and well-documented) claim that government officials systematically lie about the cost of new projects.

Now we have a rather remarkable example of this fiscal prevarication from across the ocean.

In 2002, the British government estimated the cost of hosting the Olympic Games at $2.8 billion. Ten years later, the price has passed $15 billion and is still rising. When everything is added up — lost business, as many as 13,500 British soldiers patrolling the streets of London (more than are in Afghanistan) — the expenses may come to $38 billion.

Wow, cost overruns of somewhere between 500 percent and 1300 percent. That’s bad, even by government standards.

Though I imagine that moronic advocates of Keynesian economics will argue that the $15 billion-$38 billion is a form of stimulus that will percolate through the economy – conveniently forgetting that the money had to be taxed and borrowed from the private economy in the first place.

P.S. The top cartoon in this post is a good description of how government officials come up with their fiscal estimates.

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Obama Campaign Unveils Official T-Shirt for 2012

The Obama campaign has already released a theme song and an official cigarette, so I guess it’s appropriate for them to share a 2012 t-shirt for all supporters.

And even though I posted this back in 2010, let’s decide that this is the campaign’s car.

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Excellent Gun Control Cartoon

Chuck Asay has done it again. Back in March, he produced a great cartoon showing the beneficial impact of concealed-carry laws.

Now he has another cartoon, showing the issue from the perspective of criminals.

If we want to discourage crime, simple economic analysis tells us to increase the cost of being a criminal. And research shows that’s exactly what happens when innocent people can defend themselves.

Though this funny video shows that our left-wing friends are incapable of understanding this topic.

P.S. If you want more gun control humor, check out this joke comparing California with other parts of America, this interview with a general is worth sharing (presumably an urban legend, but could be true), and here’s a t-shirt that I’m putting on my Christmas list.

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