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Archive for April, 2020

Looking through my archives, I shared three column of gun control humor in 2019 (March, August, and December).

So it’s definitely time to add some new items to our collection.

We’ll start with a cartoon that shows how gun-control zealots would try to stop the coronavirus.

And I’m sure it will work just as well as signs declaring gun-free zones.

Next we have some satire about civil disobedience, this time in Virginia.

The bad news is that some new restrictions on gun rights were approved. The good news is that the worst idea was blocked by a citizen revolt.

Adolf Hitler imposed gun control after the Nazis seized power, so he’s looking up from hell (along with his fellow dictators) and can’t believe some people want to be disarmed.

Our next item for the collection is a clever depiction of the difference between open carry and concealed carry.

In either case, life is more difficult for criminals.

This next bit of satire is self-explanatory.

I don’t know Jordan Howard, but “a group of Karens who hate freedom” is a very succinct description.

As is my habit, I’m closing with my favorite item (even if the person who put it together obviously isn’t an expert on guns).

I’ve been in this situation a few times, though efforts to muzzle me usually aren’t very effective.

I don’t even own any “assault weapons,” much less one with a high-capacity magazine. But I definitely don’t want the government to restrict my freedom in case circumstances lead me change my mind.

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Since government officials have imposed severe restrictions on economic activity, I’m sympathetic to the notion that businesses should be compensated.

But, as I warn in this CNBC interview, I have major concerns about big government and big business getting in bed together.

As is so often the case with interviews on live TV, there are many issues that didn’t get appropriate attention (either because there was too little time or because I failed to address a key point).

  • A major risk of bailouts is that politicians will insist on having a say in how companies operate. Indeed, that’s what Christian Weller was calling for in the final part of the interview. I should have pointed out the huge economic downside of having government in the boardroom.
  • There’s a rationale for short-run emergency legislation, but we should be very concerned that self-interested politicians and power-hungry bureaucracies will use the coronavirus crisis as an excuse to permanently expand their power and control over the economy’s productive sector.

P.S. I usually try to avoid making predictions (economists are lousy forecasters), but I feel confident in asserting that my friends on the left – once the coronavirus crisis has ended – will be complaining about big businesses having too much power.

I’m not against large companies, per se. But I don’t want bigger firms to gain an advantage over small companies by getting in bed with government.

If we want fair and honest competition, we need separation of business and state. No bailouts, no cronyism, no subsidies, and no favoritism.

That’s the part folks on the left don’t understand.

P.S. If you want more information on the economic damage caused by bailouts, watch this video and this video.

P.P.S. Speaking of videos, here’s some satire about the toys that politicians get for their children.

P.P.P.S. I wish this was satire, but American taxpayers are helping to underwrite cronyism in other countries.

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Like many supporters of individual liberty, I’m an anti-majoritarian. I don’t want my freedom to be at the mercy of 51 percent of the population. For all intents and purposes, I want the Supreme Court to protect the country from democracy.

So, based solely on the title, I was automatically disposed to like 10% Less Democracy, a book authored by Professor Garett Jones of George Mason University.

But Garett’s book isn’t a manifesto about the American Constitution and its (sadly neglected) provisions designed to protect economic liberty. It doesn’t even mention my favorite part, Article 1, Section 8, which lists the few and limited powers of the central government.

Instead, his book focuses on a different topic. He’s arguing that we will get better outcomes if ordinary people have less influence on public policy.

And he’s not subtle about that point. The full title of his book is 10% Less Democracy: Why you should trust elites a little more and the masses a little less.

All of a sudden, I was less instinctively favorable to the book.

Simply stated, there are too many cases where the elite tends to be on the wrong side.

When someone says we should trust the elite, I envision people like Mitt Romney and Michael Bloomberg deciding everything from how much tax we pay to what food we’re allowed to eat.

To be sure, people like that would produce a much better outcome when compared to having a lunatic like Bernie Sanders in charge of the government, but I’d like to have a government filled with people who are more likely to leave me alone, such as Calvin Coolidge, Grover Cleveland, and Ronald Reagan.

But you’re not supposed to judge a book by its cover. And that means you shouldn’t judge it by its subtitle, either.

So I took the bold step of actually reading the book (unlike, for instance, when I wrote about Nancy MacLean’s smear job against James Buchanan).

And I liked it. A lot. It’s well written, avoids needless jargon (you don’t need to be a trained economist to understand his points), and touches on many important issues.

And Garett does a great job of dispassionately providing evidence. So even when he made points that rubbed me the wrong way, I was forced to wonder whether I was thinking with my heart rather than my head.

Here’s a small sampling of why you should buy – and read – the book.

In Chapter 1, you’ll learn that there’s very little evidence that democracies produce better economic results, but you will learn that they’re less likely to produce famine and mass killings.

In Chapter 2, you’ll learn how Congress is a “favor factory” and read Garett’s hypothesis that politicians will be more likely to support good policies such as free trade if they have longer terms.

In Chapter 3, you’ll learn that independent central banks work better (yes, feel free to criticize the Federal Reserve, but nations such as Argentina show it’s always possible to get worse outcomes).

In Chapter 4, you’ll learn from state evidence that independent judges also generate better results, at least when compared to judges that are directly elected by voters.

In Chapter 5, you’ll learn that not all voters are created equal.

In Chapter 6, you’ll learn that public policy might improve if bondholders had a bigger say in government policy, an insight from Alexander Hamilton.

In Chapter 7, you’ll learn some “public choice” insights about getting things done in Washington (whether that’s a good idea is an entirely different discussion).

In Chapter 8, you’ll learn that joining the anti-democratic European Union is the right choice for some nations, but also that the United Kingdom had good reasons for Brexit.

In Chapter 9, you’ll learn how Singapore is a huge success story with “50% less democracy.”

Garett concludes with some analysis on how to get the right amount of democracy.

His basic hypothesis is that we have too much input from the masses and he even put together his own version of the Laffer Curve to show that we would get better outcomes with less democracy.

By the way, I can’t resist pointing out that you want to be at the peak of Garett’s Laffer Curve.

With the original Laffer Curve, however, that’s not the right outcome.

P.S. Garett’s book does suffer from one sin of omission. I would have appreciated a chapter on the anomaly of Switzerland. It’s a very successful, very well-governed nation, yet it has an extremely high level of not just democracy, but direct democracy. Voters directly decide all sorts of major policy issues.

Is Switzerland an exception to the rule? Are Swiss people simply more rational than their neighbors? Does the country’s federalism-based model lead to better choices? It would be fascinating to get Garett’s insights.

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A couple of weeks ago, I debunked a remarkably anti-empirical column by Dana Milbank of the Washington Post.

He claimed that America’s response to the coronavirus was hampered because government is too small, yet the nations he cited as successful role models actually have much smaller public sectors than the United States.

I congratulated him for accidentally making a strong case for libertarianism and providing evidence for my Seventh Theorem of Government.

Unfortunately, other journalists share Mr. Milbank’s ignorance with regards to easily accessible data on fiscal policy.

Writing for the Atlantic, George Packer asserts that the U.S. response to the coronavirus has been a miserable failure because government is too small.

Every morning in the endless month of March, Americans woke up to find themselves citizens of a failed state. …a federal government crippled by years of right-wing ideological assault, politicization by both parties, and steady defunding. …tests for the virus were almost impossible to find… years of attacking government, squeezing it dry and draining its morale, inflict a heavy cost that the public has to pay in lives. All the programs defunded, stockpiles depleted, and plans scrapped meant that we had become a second-rate nation.

Michael Brendan Dougherty of National Review takes apart Packer’s column.

He points out that CDC funding has increased, while also noting that the bureaucracy has squandered the additional money it has received.

…the CDC’s funding has increased — not that it has made good use of the extra money. This is not a lean and mean virus-fighting machine, getting by on starvation-level resources. It maintains a Hollywood liaison to consult on films. In recent years, it has expanded beyond its core mission to promote motorcycle safety and sponsor programs dedicated to fostering “safe, stable, nurturing relationships” in schools. If you’re wondering why there was lots of political and social messaging larding up CDC documents on COVID-19, just realize that when Congress increases an agency’s funding, the result is likely to be more ideological make-work jobs rather than a more effective workforce. …as for public-sector health-care spending, ours is not notably low — it’s roughly equivalent to those of the developed nations of Western Europe.

And he also observes that nations with smaller governments have done a better job than countries with bigger governments.

…The East Asian states that have done best in fighting COVID-19 are not social-democratic but hyper-capitalist. Compared with them — and to America —Western Europe has done much worse at containing the spread of the coronavirus and the holding down the death toll.

Excellent points.

For my contribution to this debate, I’m going to investigate whether Mr. Packer is right about “steady defunding” of the federal government.

To see whether he is correct about “programs defunded,” I went to Table 1.3 of the Historical Tables of the Budget and created the following chart to see what happened to inflation-adjusted spending over the past 40 years.

Lo and behold, it turns out that Mr. Packer is completely wrong. There hasn’t been any defunding. Not even close.

Instead, the inflation-adjusted burden of government is almost three times greater today than it was the year Reagan was elected (and it will be more than three times greater once all the emergency spending is included).

The bottom line is that I can’t figure out whether to be more dismayed that journalists are innumerate or that major publications apparently don’t have fact checkers.

P.S. There were periods when spending grew faster than at other times. There were also times when the private sector grew faster than the government (fulfilling the Golden Rule). And we also can see the how government exploded because of TARP and Obama’s faux stimulus and then was briefly constrained during the Tea Party era (and is now climbing rapidly under Trump).

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Having written about serious and depressing coronavirus-related issues during the week, it’s time for some politically-themed coronavirus humor.

Regular readers know that I’m a long-time proponent of this message for healthy thinking.

Moreover, I think it’s safe to say that coronavirus won’t come close to killing as many people as the various strains of socialism.

Here’s some humor based on Dr. Trump’s latest medical advice.

The coronavirus is bad for the nation, but it’s given the crowd in Washington a reason to engage in their favorite activity.

Which leads America’s best satire site, Babylon Bee, to report on a crime wave.

A nefarious gang of masked bandits has voted to steal another $500 billion from your grandchildren, investigators confirmed Thursday. The mysterious masked culprits…have not been apprehended yet and so are continuing to plot more heists. …”It’s the perfect crime,” said the gang’s ringleader, cackling, as she approved the plan to rob your grandchildren of their future. “We print the money, we borrow the money, then we’re gone before the bill comes due. The plan is flawless!”

Well, not quite flawless.

Here’s the latest version of a very recognizable meme.

Fortunately, I’ve never seen bats on the menu as part of my travels to China.

Here’s another jab at Trump’s medical advice.

Here are some excerpts from another report published by Babylon Bee, this one dealing with the petty tyrants in flyover country.

On Meet the Press Sunday, Michigan Governor Gretchen Whitmer reminded everyone that “revolutions and revolts are simply un-American.” Whitmer called on the protesters in her state to stop their illegal assembling, reminding them that protesting so-called tyranny is a foreign idea to the history of the United States. …”It flies in the face of every American tradition. Revolting against tyranny has no place in this great country.” Governor Whitmer then rattled off a long list of things that she also believes to be un-American: …Declaring independence from tyrants… Having a list of protected rights… Separation of powers… Freedom of religion, assembly, the press, protests, and speech… Federalism… “If you’re really Americans, you’ll stop with this dangerous revolutionary activity,” she concluded.

Here’s a clever image that applicable if you recognize there are tradeoffs.

Since I’ve written about the economic tradeoffs, I obviously want people to die.

Here’s a report from the Babylon Bee on a big increase in severe cases.

America suffered its highest one-day increase in cases of Trump Derangement Syndrome yesterday, adding 317,259 new cases. This brought the number of U.S. cases to roughly 59 million, while worldwide cases of the deadly disease increased to 110 million. The peak in cases was brought on by President Trump’s growing urgency to reopen the economy and allow people to go back to work. Scholars have noted that this is equivalent to slavery. …“Our models have been quite accurate from day one,” claimed Ron Whitley of the University of Washington.  “And we don’t see a peak here. Our data suggests a slow increase in cases through the summer, and then a big peak in cases about November 4 or so.”

Next, we have an actual photograph of a restaurant window across for the Treasury Department, but, if we believe in truth in advertising, the reflected sign may as well be a banner hanging from all government buildings.

The moral of the story, needless to say, is that big government enables big corruption.

Here’s another amusing story from Babylon Bee.

Congress has asked all non-essential businesses to limit their hours or close entirely for an undetermined amount of time. But this shutdown mistakenly shut down the most non-essential entity of all: the government. …”Oops,” said Senator Mitch McConnell. “We meant non-essential private businesses. Of course, the government is always essential, even when it’s not doing anything or is making things worse.” Senators, congresspeople, and bureaucrats frantically rewrote the ban to include only businesses that actually produced something and not government agencies that just watched other people make stuff. …they passed this revision in record speed, almost as quickly as they vote for pay raises for themselves. Speaker of the House Nancy Pelosi said she would have caught the mistake but had passed the ban in a hurry, saying, “We had to pass the ban to see what it did.”

Reminds me of some of the jokes from when we have a government shutdown.

I’ve saved my favorite image for last.

Here are the previous editions of coronavirus humor.

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At the risk of understatement, I’m not a fan of the International Monetary Fund (IMF).

The international bureaucracy is the “Johnny Appleseed” of moral hazard, using bailouts to reward profligate governments and imprudent lenders.

The IMF also is infamous for encouraging higher tax burdens, which is especially outrageous since its cossetted employees are exempt from paying tax on their lavish salaries.

In recent years, the IMF has been using inequality as a justification for statist policies. Most recently, the lead bureaucrat at the IMF, Kristalina Georgieva, cited that issue as a reason for governments to impose higher taxes to fund bigger welfare states.

…inequality has become one of the most complex and vexing challenges in the global economy. Inequality of opportunity. Inequality across generations. Inequality between women and men. And, of course, inequality of income and wealth. …The good news is we have tools to address these issues… Progressive taxation is a key component of effective fiscal policy. At the top of the income distribution, our research shows that marginal tax rates can be raised without sacrificing economic growth. …Gender budgeting is another valuable fiscal tool in the fight to reduce inequality…. The ability to scale up social spending is also essential… A cornerstone of our approach to issues of economic inclusion is our social spending strategy.

What’s especially remarkable is that the IMF has claimed that the punitive policies actually will lead to more growth, in stark contrast to honest people on the left who have always acknowledged the equity-efficiency tradeoff.

The economics editor at the left-leaning Guardian, Larry Elliott, is predictably delighted with the IMF’s embrace of Greek-style fiscal policy.

Raising income tax on the wealthy will help close the growing gap between rich and poor and can be done without harming growth, the head of the International Monetary Fund has said. Kristalina Georgieva, the IMF’s managing director, said higher marginal tax rates for the better off were needed as part of a policy rethink to tackle inequality. …The IMF managing director, who succeeded Christine Lagarde last year, said higher taxes on the better off…would help fund government spending to expand opportunities for those “communities and individuals that have been falling behind.” …Georgieva said the IMF recognised that social spending policies are increasingly relevant in tackling inequality. …She added that many less well-off countries needed to scale up social spending.

Ironically, the IMF actually has admitted that this approach is bad for prosperity.

It has produced research on something called “equally distributed equivalent income” to justify lower levels of income so long as economic misery is broadly shared.

I’m not joking. You can click here to see another example of the IMF embracing poverty if it means the rich disproportionately suffer.

In other words, negative-sum economics. Though Margaret Thatcher was more eloquent in her description of this awful ideology.

At first, this column was going to be a run-of-the-mill anti-IMF diatribe.

But as I contemplated how the people fixated on inequality are willing to treat the poor like sacrificial lambs, it occurred to me that this is a perfect opportunity to unveil my Eighth Theorem of Government.

P.S. Here are my other theorems of government.

  • The “First Theorem” explains how Washington really operates.
  • The “Second Theorem” explains why it is so important to block the creation of new programs.
  • The “Third Theorem” explains why centralized programs inevitably waste money.
  • The “Fourth Theorem” explains that good policy can be good politics.
  • The “Fifth Theorem” explains how good ideas on paper become bad ideas in reality.
  • The “Sixth Theorem” explains an under-appreciated benefit of a flat tax.
  • The “Seventh Theorem” explains how bigger governments are less competent.

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When I put forth the “The Case for Social Security Personal Accounts” in early 2011, I pointed out that the program’s long-run fiscal shortfall was more than $27 trillion.

We should be so lucky to have that problem today.

The Social Security Administration just released the annual report on the program’s finances, so I went to to Table VI.G9 of the “Supplemental Single-Year Tables” to peruse the yearly projections for future revenue and spending (which are adjusted for inflation so we have a more accurate method for comparisons).

The bad news is that an ever-increasing amount of our income is going to be grabbed by payroll taxes. The worse news is that Social Security’s spending burden will climb at an even-faster rate (historical data to the left of the red line, future projections to the right of the red line).

For those who focus on the less-important issue of red ink, the gap between revenue and spending over the next 75 years is projected to reach $44.7 trillion.

The gap in this year’s report is not directly comparable to the number I cited in 2011, but there’s no question the program’s finances are heading in the wrong direction.

This is partly because Social Security – as a “pay-as-you-go” program – is very vulnerable to demographic changes.

Like other types of Ponzi Schemes, it can work so long as there are always more and more new people entering the system.

But America’s demographic profile is changing. We’re living longer and having fewer kids.

In a column for the Foundation for Economic Education, Daniel Kowalski has a summary of how the program works and why it has a grim future.

Social Security recipients are not paid with the money that the government deducted directly from them and their past employers. Instead that money was used to pay the benefits for past retirees, while current retired recipients are getting their money through Americans who are currently working and contributing to the system. …the first recipients of the Social Security program took out far more than they put in with the difference being made up by the fact that active workers then greatly outnumbered beneficiaries. In 1940 this was not an issue as there were 159 workers supporting one beneficiary. …By 1960, 15 years after President Roosevelt’s death, that ratio was reduced to 5 workers for every beneficiary. In 1980, the ratio dropped to just above three and in 2010 it dropped below that. …there is one thing that Millennials and Generation Z can do to prepare themselves for that day. Start saving and planning for retirement now and make a plan that does not count on a government-issued Social Security check.

He’s right, and his column doesn’t even address the other problem for young people, which is the fact that they get a rotten deal from the program, paying in record amounts of money in exchange for hollow promises of a meager monthly benefit.

By the way, the numbers in the two charts above are based on the Social Security Administration’s “intermediate” assumptions.

I’ve never had any reason to question the reasonableness of those numbers. But in a world with coronavirus, which is causing crippling short-run economic damage and could cause significant long-run harm, it may be more prudent to look at SSA’s “high-cost” assumptions.

The bottom line is that the program’s long-run shortfall could be more than $20 trillion higher.

And remember, these numbers are in 2020 dollars. In other words, adjusted for inflation.

So how do we solve this mess? How do we avoid a grim fiscal future?

Shifting to a system of personal retirement accounts would be the most prudent approach. Yes, there would be an enormous transition cost since we would need to pay benefits to current retirees and many older workers, but that transition cost would be less than the $44.7 trillion unfunded liability (or even more!) of the current system.

I’ve written many times about the benefits of personal accounts for the United States, but I find most people are more interested in real-world evidence. Here are just a few of the several dozen nations that either fully or partially utilize private savings instead of political promises.

P.S. Some folks in Washington want to exacerbate Social Security’s fiscal burden by expanding the program.

P.P.S. I hate to add to the bad news, but the long-run finances for Medicare and Medicaid are an even-bigger problem.

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