×
↓ Freedom Centers

Economic Freedom

Waiting to Exhale: Biden’s $1.7 Trillion Anti-CO2 Tax Hike

By DEROY MURDOCKNational Review

His ‘Clean Energy Revolution’  echoes Obama-Biden’s eco-failures.

Former vice president Joe Biden’s Clean Energy Revolution exploded on the launch pad Tuesday. Large, now-attributed passages of his manifesto against so-called global warming initially were lifted from other publications. Biden’s plagiarism recalled his flat-out theft of a speech by far-left British parliamentarian Neil Kinnock in 1987.

But Biden’s plan is far worse than just partially stolen. It confirms that the “centrist” Biden is just another big-government leftist, hooked on high taxes and reckless spending.

Biden’s Revolution is a $1.7 trillion tax hike. It enshrines his pitch to voters in South Carolina and elsewhere: “First thing I’d do is repeal those Trump tax cuts.” Biden pledges to rescind the tax relief that has resuscitated U.S. industry, revived 3.2 percent GDP growth, and reduced unemployment to 3.6 percent and historical or near-record lows for blacks, Hispanics, and women.

After siphoning $1.7 trillion from America’s productive sector, Biden would follow the liberal playbook: Assign Washington-based experts to redistribute this bounty more wisely and justly than the bedraggled American people ever could.

Biden, no surprise, recommends a Santa’s sleigh of “allocated tax credits and subsidies” for “sustainable” initiatives. The eco-crats will succeed next time. After all, Washington always learns from its mistakes. And mistakes multiplied as the Obama-Biden administration poured taxpayer cash into countless eco-brainstorms:

• $570 million dripped into solar-power company Solyndra. Then it went bankrupt. Obama-Biden financed 18 green companies that also died and were buried in the Heritage Foundation’s Green Energy Graveyard.

• $3 billion flowed into Cash for Clunkers. Americans traded their old automobiles for $4,500 each in federal outlays. This was supposed to create jobs in Detroit, as drivers bought new, fuel-efficient U.S. vehicles. While 38.5 percent of this program’s car purchases were domestic, J.D. Power estimated, 61.5 percent were foreign. Cash for Clunkers primarily enriched Japanese and Korean autoworkers.

• $34.7 billion cascaded from Obama-Biden’s Department of Energy into clean-tech companies. They created “nearly 60,000” jobs. Cost per post: $578,333.

Biden also offers what statists truly crave: control. They never are happier than when they can boss Americans around, from dawn to dusk.

“I fought along with President Obama,” Biden said in a video that accompanied his proposal, “for a Clean Power Plan that limited carbon emissions from both existing and new power plants.”

CPP’s reels of red tape were designed to hamstring existing energy suppliers, at injurious economic cost. Using data from Obama-Biden’s Energy Information Agency, I calculated that — between 2015 and 2040 — CPP would have:

• Slashed real GDP by $993 billion, or an annual average of $39.7 billion.

• Sliced real disposable income by $382 billion, or $15.3 billion yearly.

• Chopped manufacturing shipments by $1.13 trillion, or $45.4 billion per annum.

• Whacked 1.7 million manufacturing jobs, or 68,000 pink slips yearly.

And for what benefit?

EPA assumed no Chinese, Indian, or other cheating and forecast that Obama-Biden’s scheme would have shaved expected global warming by 0.02 degrees Fahrenheit by 2050. That’s like cranking a thermostat from 72 degrees way, way down to 71.98 degrees.

As Americans for Tax Reform reports, Biden also wants an “end-to-end high-speed rail system that will connect the coasts.” Ideally, a Japanese-style U.S. bullet train would zoom at 200 mph. Thus, today’s 2,450-mile, 4.5-hour, nonstop jet ride from Los Angeles to New York would last at least 12.25 hours on Bidentrak. (A 24.5-hour round trip would devour more than one entire transit day.) Why would anyone travel nearly three times more slowly by rail than air — assuming neither stops nor glitches?

Beyond staying in Delaware, Joe Biden’s Earth-friendliest move would be to recycle his Revolution and, instead, promote natural-gas production. Carbophobes should cheer this news: Thanks largely to gas fracking, U.S. carbon-dioxide emissions keep falling — down 13.4 percent from 2005 to 2016 and, BP estimates, another 0.82 percent in 2017, under President Donald Trump. Meanwhile, CO2 output rose 1.8 percent in 2017 across the climate-obsessed European Union. Natural gas cuts CO2 by 42 to 53 percent versus other fossil fuels, generates jobs, and has made America the world’s largest energy producer.1

More, please!

Michael Malarkey contributed research to this opinion piece.


Satellite TV no long needs protection

By Peter RoffStar Beacon

To you and me, the meaning of the word “temporary” is generally clear. But not when the folks in Washington use the word.

Consider the “temporary” telephone tax Congress imposed to help fund the Spanish-American War. If you check your history books, you’ll see that the war lasted from April to August of 1893. The tax, on the other hand, survived into the second Bush Administration.

Another “temporary” law, one intended to speed the commercialization, expansion, and consumer adoption of new technology is set to expire at the end of 2019. The Satellite Television Extension and Localism Act Reauthorization (STELAR) should be allowed to fade away, but political pressure being applied by the parties who benefit from it most may unhelpfully keep it alive.

No only have growth in the satellite television industry and advancements in technology made the continuation of STELAR unnecessary, it may never have been needed in the first. It was enacted just about 30 years ago to provide a significantly discounted compulsory copyright license to give satellite companies the right to import out-of-market network television signals into a local market. The alternative, forcing their retransmission to local broadcast stations over the air, was financial prohibitively and technologically challenging.

These rules were supposed to give satellite television a boost in their push to compete with the cable giants. It worked. Today, DirectTV is worth $235 billion, Dish is worth $17 billion, and both networks offer just about every programming option available.

Letting the STELAR Act expire wouldn’t be the end of the world. No one would have missed the final episode of “The Big Bang Theory” or the “Game of Thrones” finale.

What would go away are:

• The discounted compulsory copyright license for satellite retransmission of distant (or imported) broadcast signals to “unserved households.”

• A corresponding exemption from retransmission consent requirements for the carriage of these out-of-market network signals by satellite TV providers.

• The requirement broadcast TV stations and satellite and cable TV companies both negotiate carriage of local broadcast signals in good faith.

According to the broadcasters, the number of satellite television subscribers who’d be impacted if the law expires as intended is now down to just about half a million. And there’s every reason to believe consumers in those markets could find other ways to pick up network signals, either by taking them down over the air or as the beneficiaries of private arrangements between providers and broadcasters.

This corporate to corporate stuff shouldn’t have any impact on what almost every viewer in America can watch. In fact, without STELAR, it might give individual communities a lift since the incentive for satellite carries to offer network affiliates from outside the coverage area instead of local news goes away. The playing field, as it were, becomes level.

Mature, multibillion-dollar satellite companies don’t need crony capitalist legislation protecting their interests, especially when those interests include denying consumers local news, weather, sports, and emergency information. It’s time to let it go.


Commentary: Ethanol policy something to worry about

By Peter Roff • MY Journal Courier

Last month, the Environmental Protection Agency proposed new regulations that could dramatically ramp up the use of ethanol, a corn-based bio-fuel that can be blended into gasoline. That news was music to the ears of Iowa corn farmers.

But the rest of the country isn’t so pleased. A recent poll finds that more than 80 percent of voters are concerned the new policy will raise prices at the pump. And more than two-thirds think the ethanol expansion will harm their engines.

Americans are right to be alarmed. Ethanol is an expensive, environmentally hazardous fuel. The EPA’s new policy is a flagrant attempt by the Trump administration to buy the support of farmers — at huge expense to American consumers.

The EPA’s plan would lift restrictions on gasoline containing 15 percent ethanol, a blend known as E15. At the moment, the sale of E15 is banned during the summer because the fuel generates more ozone than is permitted by the Clean Air Act.

But recently, President Trump instructed the Environmental Protection Agency to begin the process of legalizing year-round E15 sales.

The president found an E15 ally in Iowa senator Chuck Grassley, chairman of the powerful Senate Finance Committee.

In many cases, E15 is dangerous. Roughly three-quarters of the cars on the road today weren’t built to use E15, and could be seriously damaged if forced to run on the fuel.

E15 might even harm engines that have just rolled off the line. Many prominent automotive brands — including BMW, Mercedes, Mitsubishi, Mazda and Volvo — have model-year 2018 cars that aren’t equipped to handle the fuel. Some automakers have warned drivers that filling up with E15 could be grounds for voiding their vehicles’ warranties.

The fuel is also useless for motorcycles and boats, as well as lawnmowers and other outdoor equipment.

Pushing more E15 into the market will inevitably lead to costly engine damage for Americans who mistakenly assume that this government-mandated fuel is actually safe to use.

This isn’t the only way in which E15 is a bad deal for consumers. Since ethanol contains only a third of the energy of gasoline, motorists who fill up with E15 can expect to get far fewer miles to the gallon — forcing them to fill up more often.

Ethanol was developed to be a clean-burning alternative to other fossil fuels. But ironically, it actually poses a grave threat to the environment. Over a 30-year period, the net emissions from ethanol are 28 percent higher than emissions from gasoline, according to the Clean Air Task Force. One Princeton University researcher warns ethanol’s true emissions are even higher. He estimates bio-fuels emit twice as much carbon dioxide into the atmosphere as gasoline over three decades.

Ethanol proponents often argue the bio-fuel is necessary for America’s energy independence. But today, Americans already have an abundant supply of domestic, clean, low-cost fuel. Thanks to improved drilling techniques such as fracking, the country is producing historic levels of both oil and natural gas. Natural gas in particular burns far cleaner than coal, propane or gasoline. Major automakers are already designing vehicles to run on the fuel.

The president seems intent on forcing consumers to buy a costly, inefficient, environmentally damaging fuel unsuitable for most vehicles. It’s no wonder that the policy has raised a red flag with so many voters. Their concerns are more than justified. Americans deserve an energy policy that serves the country’s needs — and not the narrow interests of corn-growers.

Peter Roff is a senior fellow at Frontiers of Freedom. He wrote this for InsideSources.com.


The New FTC: Federal Takeover of Care

By George LandrithFrontiers of Freedom

FTC

Under our current law, federal charges can be brought for arson when a person willfully and maliciously sets fire to a building, structure or vessel.  Federal bank robbery charges must include evidence that a person, by force or intimidation, takes or attempts to take something of value belonging to a bank, credit union, or any savings and loan association.  And if a new bipartisan bill from two senators were to be enacted, a prima facie case for “unfair or deceptive” conduct would require the government to show that a person…filed for a patent.

Yes, we’ve somehow reached the point where inventing something is only OK if you don’t plan to protect that invention with a patent.  Maybe the next step will be to outlaw invention altogether, but I suppose we can be thankful we’re not there yet.  For now, Senators John Cornyn (R-TX) and Richard Blumenthal (D-CT) have proposed a new law where if you have discovered a way to help some sick patients and then invest capital in new research that may have the effect of helping additional sick patients, you are presumed liable under the antitrust laws if that new investment leads to a patentable invention.

To ground us in reality — sometimes you have a medicine that helps a group of people get better.  In those cases, it should not only be legal, it should be encouraged to pursue additional research to see if that medicine can be improved further, or help people fight other diseases.

After making such an investment, can you hope to argue your way out against the government antitrust enforcers?  Good luck with that, since you are starting with presumed guilt.  But perhaps it would be wiser, before you undertake resource-intensive research, to check in with the newly installed innovation czars at the Federal Trade Commission.  In this way, the FTC will decide who lives and who dies.  It’s a reincarnation of the Obamacare death panels, only with FTC bureaucrats instead of bureaucrats appointed by the Department of Health and Human Services.  

Companies would also be well advised to study what disease areas are most likely to elicit the sympathy or personal interest of FTC commissioners or their immediate family members and tailor their R&D budgets accordingly.  If your research turns out to be insufficient to meet the FTC standards for a substantial benefit, you may not only have wasted your money, you may have committed an antitrust violation.  

But what about the Constitution?  Well you see, our nation’s founding fathers clearly were unaware of the all-knowing powers of the Federal Trade Commission when they specified a right to one’s own inventions (your Intellectual Property) as the only individual right described in the text of the Constitution.  And the icing on this big-government cake is that the FTC can bring this new charge in their kangaroo court of FTC administrative litigation, where the FTC acts as prosecutor, judge and jury.  

This bill claims to be about prescription affordability (it is titled the Affordable Prescriptions for Patients Act, or APP Act), but nothing in it makes prescriptions more affordable.  The most likely direct effect on pricing will be the cost of parking near the FTC, while diminishing the property rights of American innovators.  Antitrust lawyers will certainly derive some benefit, but that could increase their hourly rates if demand for their services goes up.  So maybe the APP acronym is really for the Antitrust Practitioners Paradise created by this legislation.


President Zelensky On The Ukrainian Minefields

By Dr. Laszlo Kemeny & Dr. Miklos K. RadvanyiFrontiers of Freedom

The so-called Maidan revolution of 2014, and the subsequent five years under President Petro Poroshenko have brought nothing but unrelenting catastrophes upon the since 1991 independent former Soviet Republic of Ukraine. During former President Petro Poroshenko’s reign, Crimea has been lost to the Russian Republic, a bloody civil war has devastated the Donbas region, hundreds of thousands of educated Ukrainians have left the country for the European Union, the national currency, the hryvnia, has lost more than 20% of its value vis-a-vis the Euro, inflation has hit astronomical proportions, the economy has flirted with total bankruptcy and presently only vegetates on the handouts of the IMF, the national debt has reached 40% of the GDP, the all pervasive corruption has impoverished the entire society except Mr. Poroshenko and his cronies, criminal organizations have controlled large segments of the economy, and the Ukrainian per capita income has fallen to the last place in Europe behind even Moldova and Bulgaria.

Under these circumstances, there could not have been surprising that at least a year before the presidential election opinion polls already indicated Petro Poroshenko’s defeat. Volodymyr Zelensky clearly rod on the crest of ubiquitous dislike of the former president. Yet, few have had expected the tidal wave with which the new President Volodymyr Zelensky beat his predecessor. In the first round, Volodymyr Zelensky received 30.24% of the votes, while Petro Poroshenko trailed him with 15.95%. The second round brought a total political disaster to Petro Poroshenko. He ended up with only 24.46%, while Volodymyr Zelensky gathered 73.23% of the total votes.

With this kind of electoral victory, President Zelensky has won a popular mandate to transform Ukrainian politics from a semi-criminal state to a true democracy. In this context, democracy should mean a system of government in which the will of the majority of the citizenry must be respected with the right of the minority to constructively oppose the forces in power. On the other hand, the majority must govern within the limits of the constitution and the laws and respect the morality and traditions of the Ukrainian society. The ultimate objective should be to rebuild and strengthen the legal and moral foundations of the Ukrainian nation.

However, this task is enormous and full of trepidations. For these reasons, President Zelensky should resist attempts of superficial experimentations. Therefore, his first objective should be to establish the rule of law. Secondly, he should fight resolutely Ukraine’s destructive opposition headed by former president Poroshenko. Meanwhile, he should not forget that the guarantee of good politics resides in the character of the politician. Simultaneously, President Zelensky should allow a constructive opposition to participate freely in the political processes. Thirdly, President Zelensky should strengthen the Ukrainian families. This can be done by legislation and also by establishing a holiday honoring the family unites across the country.

On the larger scale, Ukraine needs peace. Peace with Russia and peace with its minorities. Without such an internal and an external peace the eternal struggle for Ukrainian statehood will fail again. Moreover, without peace the reconstruction of the Ukrainian state will never materialize. Finally, without peace economic recovery will never become a reality.

Taking all these requirements into account, the policies of the United States of America and the European Union should focus primarily on the normalization of the

Ukrainian state from within and only secondarily on the present hostilities with Russia. Once the ongoing civil war is ended, the troubled relations with Russia can be addressed from a better strategic position.

The key to Ukraine is to understand that the country is replete with maliciously placed political, economic, financial, cultural, ethnic, religious, and moral landmines. These mines can only be defused gradually and with the greatest caution. To achieve a positive result, Ukraine needs all the help that could be marshalled by President Zelensky at home and the international community outside the country.


Sanders and AOC want to cap interest rates on consumer loans at 15% – here’s why that’s a bad idea

By: Anne FlemingThe Conversation

Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez want to cap consumer interest ratesin an effort to curb “sky high” credit card charges and other forms of predatory lending.

While that sounds nice in principle, in practice their plan would hurt some of the people it’s intended to help by killing off an industry that’s vital to struggling households: short-term, small-dollar lending. 

The history of small-dollar loans and their regulation – which I explore in a recently published book – shows why Sanders and Ocasio-Cortez should rethink their proposal or risk emboldening the type of lending they hope to stamp out. In part this is because their plan relies on an oversimplified history of the rules that limit usury, or how much interest lenders can charge.

A brief history of usury

Laws against usury are an ancient idea. Religious texts such as the Bible and Quran prohibited all forms of usury, while the Romans barred charging compound interest. 

And when the early American colonists began settling up and down the Eastern Seaboard, they brought with them England’s usury law. By the 1970s all but three states still had general usury laws on the book. Annual rate caps ranged from as little as 4% in North Dakota to as high as 30% in Rhode Island.

These caps became less effective in 1978 when the U.S. Supreme Court ruled that state laws don’t apply to loans from out-of-state banks. This allowed credit card-issuing banks to avoid more stringent usury laws by locating in states with higher caps or none at all. Some states, such as South Dakota and Delaware, repealed their laws after the ruling to attract banks. 

So while usury laws still generally restricted rates on some types of loans, the sky became the limit for bank-issued credit cards, with some charging subprime rates as high as 79.9% per year.

Sanders and Ocasio-Cortez would like to return to the world as it existed before what they call that “disastrous” Supreme Court ruling. Their Loan Shark Prevention Act would impose a 15% annual interest rate cap on all consumer loans while allowing states to set even lower rates. 

But their understanding of history isn’t quite right. That’s because starting in the early 20th century, states began making exceptions to their usury laws to allow for small loans.

Small-sum lending laws

In the early 20th century, state usury laws applied to almost all types of loans. As a result, small-dollar lending was effectively outlawed nearly everywhere because lenders could not operate profitably at the legal rates of charge. 

Usury laws fixed maximum charges as a percentage of the amount borrowed on an annual basis, which yielded a tiny dollar fee for small, short-term loans. For example, in a state with a 6% cap, a lender offering a US$200 three-month loan would be able to charge only $3 in total interest – the monthly rate would be just 0.5%. At such low rates, small-sum lenders could not cover the costs of running their business.

But working-class households still needed access to credit so strict usury laws didn’t diminish the demand for these loans. Rate caps simply discouraged legitimate enterprises from entering the marketplace. That left borrowers to deal with loan sharks willing to break the law.

The philanthropic Russell Sage Foundation, which studied the problem in the 1910s, urged states to exempt licensed small-sum lenders from their general usury laws. The foundation drafted a model law, which became known as the Uniform Small Loan Law, that allowed these lenders to charge up to 3% per month, or 36% on an annualized basis, on cash loans of a few hundred dollars.

Today, all 50 states continue to allow small-sum lenders to charge more than 15% per year.


America’s Best Defense Against Socialism

By: Matthew Continettifreebeacon.com

The United States of America has flummoxed socialists since the nineteenth century. Marx himself couldn’t quite understand why the most advanced economy in the world stubbornly refused to transition to socialism. Marxist theory predicts the immiseration of the proletariat and subsequent revolution from below. This never happened in America. Labor confronted capital throughout the late nineteenth century, often violently, but American democracy and constitutionalism withstood the clash. Socialist movements remained minority persuasions. When Eugene V. Debs ran for president in 1912, he topped out at 6 percent of the vote. Populist third-party candidates, from George Wallace in 1968 (14 percent) to Ross Perot in 1992 (19 percent) have done much better.

Keep this in mind when you read about the rebirth of socialism. Yes, Bernie Sanders and Alexandria Ocasio-Cortez are household names. Membership in the Democratic Socialists of America (DSA) has spiked since 2016. Forty percent of Americans told Gallup last month that “some form of socialism” would be “a good thing for the country.” Media are filled with trend pieces describing the socialist revival. A recent issue of The Economist devoted the cover package to “Millennial socialism.” The current New Republic includes four articles about “the socialist moment.” In March, New York magazine asked, “When did everyone become a socialist?”

That question tells you more about the editors of New York than the country itself. As Karlyn Bowman of the American Enterprise Institute has observed, views toward socialism are stable. In 2010, 36 percent of respondents to the Gallup poll had a positive view of socialism. In 2018 the number was 37 percent. In 2009, 23 percent told the Fox News poll, “Moving away from capitalism and more toward socialism would be a good thing.” In 2019 the number was 24 percent. Fifty-four percent said it would be a bad thing. Gallup found that less than half of America would vote for a socialist candidate.

Socialism is in vogue because no one is sure what it is. The classic definition of abolishing private property, a planned economy, and collective ownership of the means of production no longer applies. More people today believe that socialism means “equality” than “government control.” Six percent told Gallup that socialism is “talking to people” or “being social.” The same Gallup poll that found 40 percent of the public has a positive view of socialism, however you define it, also discovered large majorities in favor of the free market leading the way on innovation, the distribution of wealth, the economy overall, and wages, and smaller majorities for free-market approaches to higher education and health care. Americans are very bad socialists.

And socialists know it. That’s why their most prominent spokesmen frame their domestic agendas in the language of the welfare state and social democracy, even as they celebrate, excuse, or defend socialist authoritarians abroad. Sanders told NPR in March, “What I mean by democratic socialism is that I want a vibrant democracy.” Okay, then—who doesn’t? The following month he told Trevor Noah that socialism “means economic rights and human rights. I believe from the bottom of my heart that health care is a human right. … To be a democratic socialist means that we believe—I believe—that human rights include a decent job, affordable housing, health care, education, and, by the way, a clean environment.” But this is not so different from FDR’s conception of the “four freedoms.” So what differentiates Sanders from a New Deal Democrat?

The less prominent socialists are somewhat more specific. Article II of the constitution of the DSA, to which Ocasio-Cortez and Rashida Tlaib belong, states: “We are socialists because we share a vision of a humane social order based on popular control of resources and production, economic planning, equitable distribution, feminism, racial equality, and non-oppressive relationships.” That is closer to the traditional definition of socialism—a definition that implies a set of institutional arrangements that inevitably would limit freedom of choice.

“Our task is formidable. Democratic socialists must secure decisive majorities in legislatures while winning hegemony in the unions,” writes Bhaskar Sunkara, editor of Jacobin magazine, in his Socialist Manifesto. “Then our organizations must be willing to flex their social power in the form of mass mobilizations and political strikes to counter the structural power of capital and ensure that our leaders choose confrontation over accommodation with elites.”

Good luck with that. Before they seize control of the unions—which represent a paltry 11 percent of U.S. workers—today’s socialists will have to overcome the same barriers that thwarted their predecessors. Nowhere has “American exceptionalism” been more evident than in the fact that the United States has been the only country without a major socialist, social democratic, or Communist party. The articles celebrating the rise in DSA membership to more than 40,000 fail to mention that there are tens of millions of Republicans and Democrats. Socialist politicians, activists, and theorists neglect the shaggy-dog history of their persuasion in the United States. The historical examples in Sunkara’s book are almost entirely drawn from Europe. It’s as if history began with Sanders’s candidacy in 2016.

In fact, socialists have recognized the difficulty they face in the United States for over a century. In 1906 the German sociologist Werner Sombart devoted a monograph to answering the question, Why Is There No Socialism in the United States? Sombart noted the comparatively high and rising standard of living of American workers. “On the reefs of roast beef and apple pie,” he said, “socialistic Utopias of every sort are sent to their doom.”

American workers had won political rights earlier than their European counterparts, making them less likely to conflate civil rights with economic benefits. America’s liberal culture emphasized social mobility. The staggering racial, ethnic, and religious diversity of America made class-consciousness almost impossible. As Max Beer, an Australian socialist of the early twentieth century, wrote,

Even when the time is ripe for a Socialist movement, it can only produce one when the working people form a certain cultural unity, that is, when they have a common language, a common history, a common mode of life. This is the case in Europe, but not in the United States. Its factories, mines, farms, and the organizations based on them are composite bodies, containing the most heterogeneous elements, and lacking stability and the sentiment of solidarity.

When it comes to preventing socialism, diversity really is our strength.

The two-party system marginalizes small, independent parties and accommodates rising tendencies and programs within preexisting electoral coalitions. Most important of all, the Constitution decentralizes and diffuses power, making it extremely difficult to expand drastically the power of the state in the name of social justice.

In 1967, Daniel Bell offered an additional explanation for the weakness of American socialism: “At one crucial turning point after another,” he wrote in Marxian Socialism in the United States, “when the socialist movement could have entered more directly into American life—as did so many individual socialists who played a formative role in liberal political development—it was prevented from doing so by its ideological dogmatism.”

All of these various obstacles remain in place. In January, Gallup found that 77 percent of Americans are happy “with the overall quality of life in the U.S.” Sixty-five percent are satisfied with the “opportunity for a person to get ahead by working hard.” Fifty-three percent like the “influence of organized religion.” We have the best employment situation in half a century. Real disposable income continues to rise. Last year the Congressional Budget Office reported that all Americans have enjoyed an increase of post-tax income since 1979. “It’s doubtful that most Americans would prefer to revert to the world as it was in 1979,” wrote Robert Samuelson, “a world without smartphones, the Internet, most cable television, or laparoscopic surgery,” and with the Soviet Union.

The United States is far more heterogeneous than it was 40 years ago. The success of identity politics and “woke capitalism” underscores the difficulty of making the sort of class-based appeals Sanders learned at meetings of the Young People’s Socialist League. Americans put their familial, racial, ethnic, and religious attachments ahead of membership in an income or occupational group. Besides, some 70 percent of America considers itself middle class.

One of the reasons the socialist and socialist-curious candidates in the Democratic primary have been arguing against the Electoral College and for expanding the Supreme Court is they understand the challenge the Constitution poses to their dreams. The type of centralization and bureaucratic administration socialism requires is incompatible with a system of federalism, checks and balances, and enumerated powers. Fortunately, structural change is extremely difficult in our vast and squabbling country. It was meant to be.

The self-defeating tendencies toward radicalism and sectarianism are also visible. Expanding government to provide more resources to the poor is popular; eliminating private and employer-based insurance is not. Protecting the environment and reducing carbon emissions is popular; abolishing air travel and declaring war on cows is not. More money for teachers is popular; freezing support for charter schools, as Sanders called for this week, is not. DSA member Doug Henwood writes in the New Republic of a split emerging within the organization between “Bread and Roses” and the “Socialist Majority Caucus.” The narcissism of small differences has doomed such movements in the past.

Note also that Sanders has faded in recent weeks after Democratic voters encountered a viable non-socialist alternative in Joe Biden. Ocasio-Cortez’s favorability is underwater. Medicare for All polls well with voters in the abstract—when they assume it means simply more of the current Medicare program—but support falls as soon as they hear about the conformity and control it will entail.

The good news is America contains antibodies against socialism. As Seymour Martin Lipset and Gary Marks wrote in 2000, “Features of the United States that Tocqueville, and many others since, have focused on include its relatively high levels of social egalitarianism, economic productivity, and social mobility (particularly into elite strata), alongside the strength of religion, the weakness of the central state, the earlier timing of electoral democracy, ethnic and racial diversity, and the absence of feudal remnants, especially fixed social classes.” The title of Lipset and Marks’s book is It Didn’t HappenHere. And as long as we uphold and defend the political and cultural elements that make America exceptional, it won’t.


In Wake Of Federal Tax Reform, Blue States Scramble To Hide High Taxes

By Kyle Samminthe Federalist

Since the Tax Cuts and Jobs Act became law in 2017, government officials in high-tax states have been frantically trying to find a way to overturn the provision that limits taxpayers’ deduction for state and local taxes to $10,000. That limit makes taxpayers in high-tax jurisdictions feel the impact of their local governments’ tax-and-spend policies more keenly, and those governments will do anything (short of actually cutting taxes) to prevent that from happening.

First they resorted to weird workarounds that will surely be ignored by the Internal Revenue Service and struck down by the courts as the ruses that they are. Then they sued in federal court to stop Congress from changing the tax law. The lawsuit is without merit—it’s so bad, even California declined to join it.

Now at least one state, Connecticut, is considering radically reordering its tax system in a way that will be objectively worse for its citizens, all to spite the federal government. Sooner or later, these tricks will be used up and the high-taxing states will have to face reality.

Like It Or Not, The Government Can Tax All Income

Any analysis of the federal income-taxing power must begin with the Sixteenth Amendment to the Constitution, which is brief but sweeping: “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.” While Article I always gave Congress the power to impose direct taxes, the Sixteenth Amendment removed the constitutional restrictions on that power that made its exercise practically impossible.

That power, with the pre-1916 restrictions removed, is as broad as it gets. If you have income, the federal government can tax it. From the beginning, courts have recognized the sweeping nature of the Sixteenth Amendment and, in 1955, clarified further just how broad the amendment is in the landmark case of Commissioner v. Glenshaw Glass Co. In that case, the upheld the Internal Revenue Code’s definition of income as being truly “all-inclusive.”

To admit this does not require an endorsement of high taxes, or indeed of any taxes at all. To say that the government can tax all income does not mean you think they shouldtax all income. It is only to admit a fact that, until recently, Democrats were especially fond of acknowledging: the government has the power to tax your income.

Admitting that also does not mean that the government must tax all income. We have never had a truly flat tax. The 1916 Revenue Act, for example, allowed a deduction for foreign taxes as well as state and local taxes (commonly abbreviated as SALT). It also contained deductions for depreciation, depletion, and interest that are similar to those still in the code.

But none of these deductions were a matter of right; they were legislative choices, undertaken to reduce the burden of taxation in ways that Congress thought made the income tax fairer. That’s a fine idea, but it does not create an inalienable right to that tax deduction.

State-Level Tax Evasion

Connecticut’s plan to beat the system is clever—too clever, really. Jared Walczak of the Tax Foundation explained the details in a recent article: “the state’s graduated-rate income tax would be largely replaced by a 5 percent payroll tax, plus an additional 2 percent tax on income above $200,000, which would raise more money than the current income tax. The state’s Earned Income Tax Credit (EITC) would be increased to offset the higher tax liability for low-income earners, and because the payroll tax is a deductible expense for businesses, taxpayers subject to the $10,000 [SALT] deduction cap would get a federal tax cut even as the state generates more money.”

Walczak’s article points out the main problems with the complicated proposed tax structure. Getting the thing to work at all without creating bizarre incentives is a problem. For example, a payroll tax with multiple brackets will inevitably require massive end-of-year adjustments for anyone working multiple jobs. It also results in a different tax structure for wage workers and independent contractors, as well as people who live off investments.

Does the Nutmeg State really want to shift the tax burden away from one group of people based purely on the terms of their employment? If so, regular jobs are going to shift to other states and freelancers are going to move in, creating a hole in the state budget. The idle rich will come out ahead, too, as their non-wage income becomes non-taxed.

That’s a strange thing for a supposedly liberal state to do, but ordinary concerns fly out the window when the overriding goal of thwarting the president enters the equation. Democrats have made a cottage industry out of saying richer people need to pay more taxes. When that becomes slightly true because of a Republican initiative, however, all of the well-heeled blue staters want to use corporations to hide income from the federal government.

Eroding Federalism For a Century Comes Back To Bite 

The pending case of New York v. Mnuchin, to which Connecticut is also a party, makes even less sense. The attorneys general of these four high-tax states suggest that the federal taxing power was never intended to interfere with the states’ taxing power. There is no citation for this point, which tells you about all you need to know: the claim is invented out of thin air.

The idea that the reduced SALT deduction impairs the states’ taxing power is also nonsensical; the states retain the power to tax, they just can’t use a federal deduction to hide how high their taxes are. As Joseph Bishop-Henchman wrote for the Tax Foundation, “Tax deductions and carve-outs are a matter of legislative grace.”

Even the idea that federal taxation must exempt all state taxes is unsupported by history. Bishop-Henchman cites several instances when the deduction was limited, including in 1964, 1969, 1986, and 1993. And from the start, federal tax never completely excluded state and local taxes: it was a deduction, not a credit. While taxpayers did not pay taxes on the portion of their income that they paid to their state, they did not get a full credit for that amount, either. The deduction only saves the marginal rate on the income devoted to state taxes—the fraction of the fraction.

The complainants say that “at ratification, it was widely understood that the federalism principles enshrined in the Constitution would serve as a check on the federal government’s tax power.” That’s true, but not in the way they think it is.

Federalism did result in informal limits on federal power, but only because the states, represented in the Senate, kept the federal government from fully exercising its powers at their expense. If those limits have been eroded in the past century, it is because progressives went out of their way to erode them, first by requiring the direct election of senators and later by appointing judges who allowed them to ignore all limits on federal power, written and unwritten.

These same progressives now want you to believe that one of those unwritten, informal restrictions must override the law. The change of heart is cynical, if predictable. Rich people in high-tax states are paying more federal tax, not because the federal tax rate has gone up, but because Congress decided to stop helping the states hide the effect of their unsustainable tax-and-spend policies. Those who destroyed the norms of federalism now wish the courts to re-erect them—but only insofar as it helps their friends.

It’s Not Fair!

All of these lawsuits and legal hedges are rooted in the same complaint: the rich blue states want to keep imposing high taxes on their people and want the federal government to help them obscure the consequences.Their argument here is that imposing the same rule on all taxpayers is unfair.

“By decreasing state tax revenue and making state taxes more expensive,” they write in the complaint, “the new cap on the SALT deduction will ultimately force the Plaintiff States to choose between maintaining or cutting their public investments and level of services, and the taxes supporting them. As such, the new cap on the SALT deduction directly and unfairly interferes with the Plaintiff States’ sovereignty, by depriving them of their authority to determine their own taxation and fiscal policies without federal interference.”

Their argument here is that imposing the same rule on all taxpayers is unfair. That’s a definition of “unfair” that only a small child could love. What it really means is, “I didn’t get what I want.” What they want, as the complaint plainly acknowledges, is to avoid making hard choices to balance their budgets. Every other state has had to make hard choices, but these four states don’t want to. Unfair!

Even if it were true that the law is unfair, this would be a political argument, not a legal one. Politicians on the far left want the courts to impose rules that the people and their legislators have rejected. Even their own statements confuse to whom exactly the law is unfair.

New York Gov. Andrew Cuomo attacked the tax law as one “that benefits the 1% at the expense of middle-class families.” But the loss of the deduction hits only those families who pay more than $10,000 in state and local taxes—hardly the average Joes Cuomo awkwardly attempts to evoke.

That’s Not How Any of This Works

This lawsuit will fail, and Connecticut’s too-clever workaround probably will, too. What happened in the Tax Cuts and Jobs Act of 2017 was a result that politicians from these four states found distasteful. It will force them to make the kind of hard choices that they were elected to make. It will make their previous bad decisions more obvious to their voters and put pressure on them to fix them. It will, in short, force them to govern.Twenty-first-century politicians will do nearly anything to avoid governing.

Twenty-first-century politicians will do nearly anything to avoid governing. The arguments are flimsy at best, and the remedy is uncertain. Asking the courts to strike down the partial limitation of a tax deduction is novel enough, but what comes in its place? Do they want the courts to impose taxes directly, an act that is at the core of a legislature’s functions?

They know this lawsuit is a damp squib, a feeble attempt to show the folks back home (and especially their rich donors) that they’re “doing something” to stop taxes on the rich from going up. Connecticut’s radical reform is somewhat better thought-out, but will certainly inflict unintended consequences on that state’s already struggling economy, even if the IRS doesn’t decide to ignore the whole shell game they are playing.

Like a child throwing a tantrum, they will flail and kick for as long as they can before finally having to do what they were elected to do: set a level of taxing and spending that their people can afford.


Upgrading Our Military’s Heavy Vertical Lift Capability

By George Landrith

By George Landrith • RealClear Defense

It is time to upgrade our military’s heavy-lift helicopter capabilities. The current workhorse, the CH-47 Chinook, has served our country since 1962. Despite its age, the Chinook is still the most capable heavy lift helicopter on the planet — flying at almost 200 miles per hour which is roughly the speed that the Army wants its next-generation Scout aircraft to fly. Our allies use the Chinook as well — precisely because of its utility and capability. 

Over the years, the Chinook has been upgraded and new technology built in.  As a result, our allies use the Chinook because it is a highly capable platform, and it is the world class heavy lift helicopter. However, the military’s needs have grown, and additional capabilities are needed. The question is how to most effectively and efficiently meet those needs. 

Given the Chinook’s inherent strengths and capabilities, the wisest approach is to update and upgrade the Chinook so that it can increase payload, range, and other vital capabilities. With the right upgrades to the drivetrain, rotors, and other systems, this capable and proven aircraft will continue to be the world class heavy lift helicopter platform for decades to come. Following this approach means our heavy lift needs are amply met and at a much lower cost — which means we also have available resources for other crucial national security needs. That’s a win-win.

However, recently, Army Secretary Mark Esper made remarks that suggested he wasn’t interested in upgrades, but would instead start over from scratch. Sometimes starting over from scratch makes sense. But often it doesn’t. This is one of those times where starting from scratch will waste taxpayer dollars and leave our military in a lurch while a brand new helicopter is developed and produced at a much higher initial cost and increased sustainment costs.

If the Pentagon starts over from scratch, the new helicopter fleet will not be available to our warfighters for another 30 to 40 years or longer. In contrast, an updated and upgraded Chinook is already in the works and can be rolled out relatively rapidly and at a much lower cost. This approach would give our military the world-class heavy lift helicopter it needs going well into the future, and it would save money so that other critical military needs are not neglected.

The Chinook can carry dozens of fully equipped infantry or special operators. It can transport 10 tons of supplies and equipment.  It can even carry the new Joint Light Tactical Vehicle (which replaces the older up-armored Humvee and provides a more capable and survivable vehicle) or a 155m howitzer in a sling below the aircraft. Cost effective upgrades and updates can increase payload, range, and other important capabilities. All of these upgrades can be done at a fraction of the cost of simply starting over. 

Special operators who fly the most dangerous and demanding missions in the Army swear by the Chinook and trust their lives in it. Even Espers, while signaling he wants to move on, admits that the Chinook  “is a very good aircraft” and that it should continue to be used by our special operations forces. He even admits that perhaps the future is simply “a version of the [Chinook]. I don’t know.” Clearly, there’s nothing fundamentally wrong with the Chinook as a platform. It is battle tested and battle proven. 

The wise choice would be to update and upgrade the Chinook — that would give our warfighters the capability they need and do so in the most efficient way possible. That means other mission-critical tools required by our warfighters can also be afforded. 

The truth is that the Chinook can continue to serve American warfighters with the right updates and upgrades.  And these updates are already in the works. It would be foolish to shut that down and waste money by starting over. This doesn’t require much imagination. With a new drivetrain, upgraded and redesigned rotors, and other new or upgraded systems, the lift capability, range and speed, can all be increased — even beyond its current world-class capability. This makes sense for the warfighter and the taxpayer. Esper would be wise to pursue the truth that even he admitted — our future heavy-lift helicopters “may be a version of [the Chinook.]”

In a world where the government needs to do more with less, upgrading the Chinook makes a lot of sense. This will give our warfighters the greater range, speed, and payload capacity that will be needed in the future.  And while achieving all of these milestones, it will keep both production costs and sustainment costs lower. Ditching the Chinook and starting from scratch makes no sense at all — either for the warfighter or the taxpayer.


The Early ‘90s Called Joe Biden. They Want Their Foreign Policy Back

By Sumantra Maitra • the Federalist

In a recent rally, the septuagenarian former vice president flashed his pearly set and declared, to the utter confusion of foreign policy analysts across the Euro-Atlantic, that China is no threat to the West: “China is going to eat our lunch? Come on, man.”

Beijing is the world’s second-largest economy, and increasingly isolated due to its revanchism in the Asia Pacific. It is confronting Australia, India, and Japan simultaneously, challenging the U.S. Navy and British Royal Navy every day. It’s returning to Maoist totalitarianism and Chinese civilizational exceptionalism, the leader of artificial intelligence and genetics research, with advanced space warfare capabilities and highly advanced stealth and hypersonic warfare capabilities.

China is a chronic thief of intellectual property, a great power extensively buying lands (and governments) across the world, a manufacturing giant in a trade war, and a great power engaged in espionage, cyber warfare, and naval buildup. Yet, according to the front-runner of the Democratic presidential field, it is no threat to the United States and the West.

Biden is obviously wrong about China. In fact, Biden is wrong about a lot of things. Like Johnny English, it is his job to know nothing, be wrong, and goof around. He has a glowing smile, 1950s social mannerisms, righteous rage at social justice issues to update himself for the kids, and is catastrophically wrong about every single foreign policy position possible.

Let’s start with the biggest position that would come back to haunt him as president. I was a rookie reporter covering the U.S. vice presidential candidates’ debate when I saw the difference between a quietly earnest if wonkish Paul Ryan, and a smug, condescending Biden, with a media fully disposed in the latter’s favor. It was Biden who dismissed whether Russia was a revanchist power.

While one can argue about how much Russia was a “threat” per se, no one would deny that Russia is and will be an adversarial power, and something Biden’s administration not only didn’t perceive, but when informed, dismissed mockingly.

But that is not all. Biden is stuck in time, as the world changed around him. For example, Tucker Carlson writes in his book, “Ship of Fools,” “In the fall of 2002, a total of seventy-seven senators voted in favor of the Iraq War resolution. This included the majority of Democrats, and 100 percent of the party’s rising stars. Two future presidential candidates who voted for the war, John Kerry and Hillary Clinton, also happened to be future secretaries of state. The future vice president, Joe Biden, voted for it…”

He also notes that, during Vietnam evacuation, “Senator Joe Biden of Delaware agreed; he introduced legislation to curb the arrival of Vietnamese immigrants, accusing the Ford administration of not being honest about how many refugees would be arriving.” Vietnamese immigrants, needless to say, are one of the most successful and assimilated groups in the United States, but that’s beyond the point.

The point is Biden never thought independently about what might be good or bad, but said the things the Democratic base wanted to hear. In 2002, Iraq War support was simply good politics, even though now no one talks about it.

Biden also argued for a renewed troop surge in Afghanistan, a conflict that has long transformed from a war to an imperial law and order mission, similar to what the British did in the 1890s, against Afghan rebels in North West Frontier Province. Funnily enough, when the most consequential decision of the Obama administration came, such as the raid to kill Osama Bin Laden, Biden argued against it. Obama, of course, took the advice of his generals instead.

To Biden’s credit, like a broken clock he was right about foreign policy twice. During one of the most catastrophic foreign policy decision in modern Western history, when Hillary Clinton, Samantha Power, and Susan Rice were arguing for toppling Muammar Gaddafi, which turned Libya into a slave trading hub and mass migration springboard, Biden apparently argued against it. He was also apparently overruled and then went on to fully support the Obama intervention, even when he despised Clinton, according to his aides.

Likewise, he was the first one to publicly state that there are no good Syrian rebels, because all are Qatari-funded Islamists. But then he promptly backtracked, genuflected, and apologized. He should have stuck by both, because history could have proved his caution and restraint right. But he did not.

The problem for Biden is much more than that. He reminds me of the grandmother in “Good bye, Lenin!” who fell in coma during the Soviet years, only to wake up after the fall of the Berlin Wall in a unified Germany, yet her grandson must continue an elaborate hoax to assure her that she is still in communist Germany, so she doesn’t have another shock and suffer a stroke.

Biden, likewise, is also stuck in the heady days of early 1990s triumphalism, with an expanding North Atlantic Trade Organization, an European Union that is a prospective trade ally, and the world fit for liberal interventionism and democracy, with a hope that China would eventually be entrenched as a pillar in the liberal order.

Unfortunately, none of that came true, and China is pretty much the biggest rising great-power rival challenge to an established superpower, compared to the history of rising-power challenges, from Sparta to Athens, Carthage to Rome, the Spaniards, Napoleon and Germans twice, to the Brits. There’s an academic consensus about it, and Uncle Joe is wrong once again.

Most importantly, however, he is opposed to his own base. Recent studies suggest, that Americans overwhelmingly, distinctly support a restrained foreign policy and less liberal interventionism and democracy promotion abroad, this stance is even stronger among the Democratic base.

The findings in this survey suggest that American voters are not isolationist. Rather, voters are more accurately described as supporting ‘restrained engagement’ in international affairs—a strategy that favours diplomatic, political, and economic actions over military action when advancing U.S. interests in the world. American voters want their political leaders to make more public investments in the American people in order to compete in the world and to strike the right balance abroad after more than a decade of what they see as military overextension.

Guess who won an election promising just that?

It is a mystery that President Trump cannot transform his foreign policy instincts into electoral support, but one can blame Trump’s poor PR, lack of strict message discipline, and continuous mainstream media opposition for that. The fact remains, however, that Trump is more attuned to a non-interventionist America than his prospective rival Biden.

It is still too early to say what would happen. The primaries and the debates haven’t started yet. While one can be sympathetic to an affable grand-fatherly figure, one should be careful about someone who has repeatedly, to use a liberal catch-phrase, been on the “wrong side of history.”


Five Decades’ Stagnation or Two Decades’ Weak Growth

By:  RAMESH PONNURU National Review

Something feels off in the timing of our debate over the economy. A loss of faith in free markets, among intellectuals and the public alike, was only natural in the 1930s. But today? Intellectuals on the left and the right are more convinced than ever that our economic policies are deeply misguided, at the same moment that unemployment rates and wage growth are the best they have been in decades. When Americans answer polls, they express less and less confidence in free-market capitalism — even as they express more and more satisfaction about economic conditions.

Perhaps people are evaluating these questions against different time horizons. They may, that is, think that the economy is performing well at the moment but has become less capable of delivering broad-based prosperity over the course of a generation. If today’s conditions persist long enough, then, the reputation of capitalism may recover.

Timing is relevant to our evaluation in another way. If our economy has gotten worse at generating sustained prosperity, worse enough to make a loss of faith in capitalism understandable if not justified, then it matters when this decline began.

In 2015, during the last presidential campaign, Hillary Clinton suggested that “for decades” the economy had been offering a worse deal for most people. Her explanation: “For 35 years, Republicans have argued that if we give more wealth to those at the top — by cutting their taxes and letting big corporations write their own rules — it will trickle down. It will trickle down to everyone else.” The election of Ronald Reagan, in other words, was the turning point. It followed that many of his policies should be reversed: The top tax rates should go back up and unions should be strengthened.

If economic conditions have been deteriorating for an even longer period, however, then merely reversing Reaganomics might not be enough. And it is common to run into claims, apparently backed by data, that suggest as much. The Pew Research Center notes that the average wage, adjusted for inflation, fell between 1973 and 2018. It had risen steeply from 1964 (when the data series began) through 1973. Then it dropped for roughly two decades, and over the next two recovered but did not get back to its peak.

If real wages have truly been stagnant for longer than most Americans have been alive, then the economy has not worked in anything resembling the fashion we expect. Economic growth has been mostly an illusion: We have more stuff only because more of us work, large numbers of women having joined the paid labor force. If this picture is accurate, we need to make radical changes either to the economy or to our expectations of ever-rising prosperity.

There are, however, two big reasons to doubt the stagnation thesis. The first is that non-wage benefits have become a larger and larger element of compensation. Perhaps they have become too large an element: The tax code encourages employees to get health insurance through their companies rather than take higher wages and buy coverage themselves, and there are reasons to think we would be better-off if the tax code did not do that. But non-wage benefits have economic value to employees, and so looking at wages alone will cause us to underestimate employees’ material welfare.

The second reason for doubt is that a common method of adjusting for inflation — the one used in the Pew numbers cited above — overdoes it. The center-right social scientist Scott Winship has been indefatigable in explaining why using the Consumer Price Index (specifically a measure called “CPI-U”) as the gauge of inflation is a mistake, and how it warps our understanding of economic trends. It overestimates housing inflation before 1983, and ignores how consumer behavior responds when prices change.

Since inflation compounds, small errors each year add up to major changes over decades. Use a better measure of inflation, one based on personal-consumption expenditures, and the average wage rose by 21 percent from 1973 to 2018. (Average compensation must have risen more.)

The data on median family income also show a reassuring amount of growth. The family in the middle of the pack in 2015 made 45 percent more, with the right inflation adjustment, than its counterpart in 1970.

But the same numbers may also explain some of the public’s dissatisfaction with the economy. Median family income grew by a spectacular 58 percent in the 15 years from 1955 to 1970, then grew another 11 percent from 1970 to 1985, and 24 percent from 1985 to 2000. But the median family income of 2014 was slightly lower than it was in 2000.

What happened is that after the turn of the millennium we went through an extended period of slow growth punctuated by one mild and one severe recession. Median family income dropped more than 7 percent from 2007 through 2011, the sharpest decline since this data series started in 1953. It did not recover completely until 2015.

We have had a few good years since then. But it is not surprising that during the last two decades many Americans came to feel that their economic circumstances were stagnant and insecure. It is not surprising, either, that many of them have the sense that things used to be better — or that a generation of young people who started their work lives in a slow-growth economy tend not to have positive attitudes toward capitalism.

Instead of five decades of economic stagnation, we have had two decades of weak growth. That record does not suggest that the pro-market policies of the 1980s and 1990s were fundamentally mistaken. It suggests, rather, that we have discrete problems that deserve to be tackled.

High on the list of needed changes should be a reform of our monetary regime. It failed badly over the last dozen years. In 2008, excessive fear of inflation led the Federal Reserve to signal that it was going to tighten monetary policy even as the economy was sinking into a recession. It kept monetary conditions too tight after the crisis hit, too, for example by encouraging banks to hold additional reserves. These policies made the recession more severe and the recovery weaker. That these failures are not more widely appreciated is symptomatic of the misguided thinking that continues to govern monetary policy.7

Reforms should be undertaken in other areas, too. Our higher-education system is not working for most young people. Our immense health sector includes immense inefficiency. Regions of the country with high economic growth have imposed regulations that make it prohibitively expensive for less fortunately situated Americans to move there.

So we are called to be ambitious, but not revolutionary. Capitalism does not need to be overthrown or even rethought. Rather, the principles that make markets work need to be applied to some areas where they have not been present. Our economic system does not need dismantling. But it does 


Hawley: How American Elites Threaten Our Common Liberty

By Madeline Osburn The Federalist

On Saturday, U.S. Sen. Josh Hawley addressed the class of 2019 at The King’s College in New York, where he called on the graduates to reject the Pelagian worldview that dominates our public way of life.

Hawley, who has also recently questioned the uses of social media and railed against Facebook for data and privacy violations, noted that Pelagius was loved by the wealthy, educated aristocrats of Rome, “because he validated their position and their power.” He called out the elites of Wall Street and Silicon Valley in his commencement address for the same Pelagian love of hierarchy enforced on Americans today.

Pelagius was a British monk and a moralist who rejected Saint Augustine’s views on sin and grace for a different view of human freedom and prosperity, in which freedom was earned. Hawley discussed how the elites of American society implement a Pelagian worldview, and ultimately threaten freedom for all humans.

A society that is divided by class, where one class has all the advantages, is a society gripped by hierarchy. It is also a society defined by elitism. Of course, our elites don’t use that word. They say their privileged position comes from merit and achievement. They point to their SAT scores and prestigious degrees. They talk about economic efficiency.

How Pelagian of them.

The truth is, the people at the top of our society have built a culture, and an economy, that work mainly for themselves. Our cultural elites look down on the plain virtues of patriotism and self-sacrifice. Things like humility and faithfulness. They celebrate self-promotion, self-discovery, self-aggrandizement. Self. Self. Self.

And then when industry shifts jobs overseas they say, well, workers should find another trade. I mean, capital must be allocated to its most efficient use.

When workers without college degrees can’t get a good job, they say, that’s their fault – they should’ve gone to college.

Now, I rather suspect – it’s just a hunch – that if globalization threatened America’s tech industry or it’s, say, banking sector, that we would hear a different tune. I slightly suspect we would hear that these industries are the lifeblood of the American economy and must be defended at all costs. And that’s just my point. The elites assume that their interests are vital, while everyone else’s can be done without. They assume their value preferences should prevail, while denigrating the loves and loyalties of the great middle of America. That’s the nature of elitism. And at the end of the day, this hierarchy, and this elitism, threaten our common liberty. For the steady erosion of working-class jobs and working-class life for millions of Americans means losing respect, it means losing their voice, it means losing their standing as citizens in this nation.

Our Pelagian public philosophy says liberty is all about choosing your own ends. That turns out to be a philosophy for the privileged and for the few. For everybody else, for those who cannot build an identity around what they buy, for those whose life is anchored in family, and home, and nation, for those who actually want to participate in our democracy, today’s Pelagianism robs them of the liberty that is rightfully theirs. And we cannot afford to let it to happen any longer. The age of Pelagius must end.


Stop Elizabeth Warren’s Indian-Giving

By George LandrithRedState

Just days after President Trump called out House Republicans for supporting legislation promoted by presidential candidate Sen. Elizabeth Warren (D-Mass), Democrat leaders are scrambling to determine whether they can ram the bill or one of similar profile through the House this week.

Warren has been promoting legislation that would grant a Massachusetts-based Indian-tribe, called the Mashpee Wampanoags, recognition of land over 40 miles away from its tribal headquarters to build a $1 billion casino.

The political show heated up on May 8, when the president tweeted, “Republicans shouldn’t vote for H.R. 312, a special interest casino Bill, backed by Elizabeth (Pocahontas) Warren. It is unfair and doesn’t treat Native Americans equally!” This denouncement caused Democrats, who recognized that the bill would now never receive two-thirds majority approval as required, to scramble and pull the scheduled vote from the House floor.

Nevertheless, bad ideas never seem to die in Washington, and the special interests seldom give up. This case is no exception, and with the news of Trump’s twitter opposition fading, members of the Massachusetts delegation are now back at work pushing H.R. 312, as well as H.R. 375 – a bill that makes H.R. 312 look like the epitome of ethical D.C. governance by comparison. As such, allow me to take a step back and walk you through the current state-of-play.

Aside from the fact that the Massachusetts senator pushing this bill is the same one that once said, “gambling can be a real problem economically for a lot of people,” there are plenty of reasons to be skeptical of the intentions of those pushing the legislation.

The first among them is that both the Supreme Court and Department of Interior agree “the Tribe does not satisfy the ‘under Federal jurisdiction’ requirement of the…definition of ‘Indian’,” which it would need to receive any handouts of land from the federal government.

In accordance with the Indian Reservation Act, that would require the tribe to have received recognition from the federal government before 1935. Michael Graham at The Boston Herald noted that not only did they miss this deadline but, “The Mashpees weren’t federally recognized until 2007. And that only happened because of the money they poured on notoriously corrupt D.C. lobbyist Jack Abramoff.”

In addition to H.R. 312, which would specifically grant the well-heeled Massachusetts tribe a casino away from their reservation, another bill being pushed in the House, H.R. 375 would not only grease through the casino long sought after by Warren and the Mashpees; it would also allow for the same to occur for every tribe in the country – creating an endless cycle of lobbying victories in place of Supreme Court precedent, the rule of law, and states’ rights.

Should H.R. 375 pass, all that the roughly 600 recognized tribes in the country would have to do to strong-arm the federal government into recognizing their land is demonstrate that their tribe has received acknowledgement from the Department of Interior. And as we’ve seen from the Mashpee’s lobbying efforts, often all that will require is having enough lobbying connections and sums of cash to influence the right bureaucrats and representatives with key committee assignments.

The Native Americans that have sharply called out the Mashpee’s land claims would ostensibly agree that by advancing the interests of crony capitalists, this bill is a raw deal for the Native American people. Should the legislation go into effect, the rich and powerful will succeed at the expense of everyone else, and that’s simply not fair.

Republicans should not be fooled. Elizabeth Warren is just trying to provide crony favors for groups with strategic political value to her and Republicans should reject both bills outright.

(George Landrith is the President and CEO of Frontiers of Freedom — a public policy think tank devoted to promoting a strong national defense, free markets, individual liberty, and constitutionally limited government.)


The Reconstruction of Venezuela

By Dr. Miklos K. Radvanyi

Puzzled by the glaring differences between the well organized and prosperous neighboring new republic, the United States of America, and the chaos as well as the impoverishment of the just emerging states of Central and South America, Simon Bolivar remarked in his “Letter to a gentleman showing great interest in South America’s republican cause”, in 1815:

“As long as our compatriots do not acquire the talents and political virtues that have characterized our northern brothers, I greatly fear that our completely traditionalist systems, far from being favorable for us, will be our demise. Unfortunately, the requisite level of these characteristics seems to be far from us; and, to the contrary, we are dominated by the vices acquired under the direction of a nation like Spain, which has excelled only in cruelty, ambition, revenge and greed.”

In addition to being prophetic, Simon Bolivar’s words still point to the enduring political tragedy of Spanish- Hispanic America, namely that history have not just repeated itself in regular intervals throughout the 19th, the 20th, and in the first nineteen years of the 21st centuries across Central and South America, but that it has run in ruthless as well as inhuman circles around their curious colonial heritage.

Simon Bolivar was one of those personalities who played a crucial role in initiating and then leading the independence movements across the southern part of the American continent. Yet, in the independence struggles of Venezuela, Colombia, Ecuador, Peru, and Bolivia, Bolivar’s vision of a multitude of independent republics unified under a pan-American umbrella with a single strong ruler ultimately failed to materialize. Born into the Caracas aristocracy, who lived and studied for an extended period of time in Europe, he embraced the philosophy of the French Enlightenment, especially the views of Jean-Jacques Rousseau. Accordingly, Simon Bolivar subscribed to the idea of “general will”, and to the principle of the rule of the majority.

When he was elected the President of Venezuela on December 6, 1998, the late Hugo Chavez Frias turned Simon Bolivar’s vision to its head and established under the deceptive idea of “Bolivarian Revolution” an authoritarian form of government with a populist overtone. Moreover, influenced by Fidel Castro’s distributive socialism, he focused on using Venezuela’s considerable oil resources to buy up the good will of the poor. Finally, to oppress the upper and middle classes, Chavez integrated the military and the intelligence services into his authoritarian domestic rule.

Under the strange slogan of “Motherland, Socialism, or Death”, which he changed before his death to an even more macabre one “Motherland and Socialism. We will live, and we will come out victorious”, Chavez succeeded to transform Venezuela from a rich nation to a dirt poor country. In addition to running Venezuela to the ground, Chavez’s autocracy produced a Stalinist constitution, a subservient legislature, a supreme court completely beholden to his command, and a laughable electoral law. All this was neatly subsumed into the Marxist myth of class struggle. Everything that happened before Hugo Chavez, such as slavery, feudalism, colonialism, and capitalism, were necessary evils on the prescribed Marxist road to socialism, where the truly egalitarian society will be erected without poverty and backwardness. The blood sucking bourgeoisie and their equally despicable imperialist masters will be left on the ash heap of history. Naturally, these ideas of historical materialism called for a singular foreign policy direction, namely an unequivocal anti-USA strategy.

Continue reading


Green New Deal Strengthens Putin But Weakens America

By Michael James Barton • Investor’s Business Daily

Progressive lawmakers in Congress just rolled out their “Green New Deal,” a sweeping bill designed to end America’s reliance on fossil fuels. They hope to ultimately eliminate gas-powered cars, airplanes, and even outdoor BBQ grills.

Environmental activists aren’t the only ones delighted with the proposal. Petro-state dictators like Russian President Vladimir Putin, Iranian Ayatollah Ali Khamenei, and Venezuelan President Nicolas Maduro are grinning too. They know the bill would make Americans dependent on foreign oil and gas production, weaken American influence abroad, and drastically shrink the U.S. economy.

The United States is now the world’s leading producer of both oil and natural gas, thanks to the recent revolution in drilling technologies and no thanks to progressives. These innovations such as fracking and horizontal drilling have enabled U.S. firms to recover previously inaccessible oil and natural gas from shale rock formations. Oil production has more than doubled in the last decade. Natural gas production has surged about 50%.

This energy renaissance has reduced electricity and fuel costs for American consumers.

Just as importantly, it has bolstered our national security and expanded our geopolitical influence. The United States recently became a net energy exporter for the first time in decades — a development that has reduced the free world’s reliance on fuel from unstable, dictatorial countries like Russia, Iran, and Venezuela.

Death Of The Energy Revolution?

The Green New Deal would undo this energy revolution which America has worked so hard to achieve. In addition to massively subsidizing solar and wind power, it would place enormous restrictions on drilling and fracking. The 14-page document is light on details, but its ultimate goal is clear — effectively eliminate fossil fuels and generate “100 percent of the power demand in the United States through clean, renewable, and zero-emission energy sources.”

No word from a fan of this plan, presidential candidate Sen. Cory Booker, on how exactly this renewable energy production will avoid rolling blackouts in every city and town in America. Perhaps his imaginary drug dealer friend “T-Bone” relayed an invention to Sen. Booker that makes the plan possible.

The Green New Deal would also put many oil and gas firms out of business.

If America gives up its role as the global leader in oil and gas production, hostile foreign governments will gladly take our place and weaponize their energy resources. The bill would transport us back to the 1970s, when the Arab oil embargo brought the U.S. economy to a standstill and caused gas lines and fuel rationing. America produces more than 11 million barrels of oil a day. Removing that supply from global markets would give Putin and his ilk a stranglehold on the entire world economy.

Perhaps plan supporter Sen. Bernie Sanders likes the idea of American workers wasting their time in a socialist line for basic products like fuel and bread. Not steaks though, as the plan’s proponents also call for the end of cattle in the United States.

Green New Deal: Just Hot Air

Progressive activists dismiss such concerns, arguing that America will generate almost all its energy from renewable sources and thus be immune to oil market fluctuations. But that’s fantasy. Leading researchers doubt it’s possible to transition to renewable sources within three decades — much less the 10 years called for in the Green New Deal.

In addition to hurting U.S. consumers, the Green New Deal would undermine the security of America’s closest allies. Consider that the European Union gets more of its oil and gas from Russia than from any other country — an arrangement that stymies Europe’s ability to check Russian power.

Should Russia seek to expand its influence and control in the region, as it did when it annexed Crimea in 2014, Europe will be forced to choose between standing up for its values and protecting its energy imports. That’s a precarious position. Supporters of this plan have been screaming from the rooftops about Russian influence in the 2016 election, but seem eager to hand over power to Russia in exchange for some vague promises of new things that haven’t yet been invented.

A Gift To Putin

The United States is Europe’s best hope of breaking its dependence on Russian energy. American firms have been ramping up their sales of liquefied natural gas to the continent. In October 2018, the United States traded more LNG with the EU than any month on record.

The Green New Deal would make such trade impossible. Our rapid exit from the oil and gas sector would be a gift to the Putin regime.

The Green New Deal would be a geopolitical disaster for America. Lawmakers shouldn’t give it the time of day.