Welcome to the Nanny State

Ok, I find this really ridiculous.  Someone please tell the government that I am an adult and I can make my own choices regarding what I do or do not eat and drink.  NY wants to fill its coffers and save lives at the same time.  How admirable.  Unfortunately, the government's action once again affects my ability to make free, unbiased decisions for what's best for myself.  Stop legislating things to influence what should be an individual's decision.  If the target of the legislation has no positive purpose (e.g. cocaine), then outlaw it entirely.  Otherwise, please allow me to make my own decisions without government intervention.  Why should everyone be punished because a few people are unable to make smart decisions - should every policy decision be tailored to the lowest common denominator?  What a fun country that would be.

With freedom comes responsibility.  This means if people make poor choices, they must live with the consequences (not a popular argument today).

Now I understand the argument that the state often has to take over health care costs for those who didn't take care of themselves.  

Two thoughts about this health care aspect of the discussion:

1)  That's true, but such is the nature of freedom.  I would rather have this situation exist than have the freedom to choose taken from everyone

2)  Please keep this argument in mind when we start hearing calls for "universal heathcare".  No one talks about the abdication of personal responsibility then.

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December 18, 2008

OP-ED COLUMNIST

Miracle Tax Diet

By NICHOLAS D. KRISTOF

When the human body was evolving, almost the only things we drank were breast milk for the first few years and then water, water and more water.

It would obviously have been bad if we had evolved to feel full when water was sloshing about our stomachs because then we wouldn’t have eaten our fill the next time we speared a mastodon. Today, the unfortunate result is that if you drink a bottle of 7-Up, you still don’t feel full — the body treats the liquid as empty calories, like water — and so you won’t eat any less the next time you spear a Big Mac.

That has presented a huge problem in an age of sugary drinks, and some scholars believe they have become a major source of obesity. That’s why the new soda tax proposed by Gov. David Paterson of New York is such a breakthrough.

Mr. Paterson suggested the tax — an 18 percent sales tax on soft drinks and other nondiet sugary beverages — to help raise $400 million a year to plug a hole in the state budget. But it’s also a landmark effort that, if other states follow, could help make us healthier.

Let’s break for a quiz: What was the biggest health care breakthrough in the last 40 years in the United States? Heart bypasses? CAT scans and M.R.I.’s? New cancer treatments?

No, it was the cigarette tax. Every 10 percent price increase on cigarettes reduced sales by about 3 percent over all, and 7 percent among teenagers, according to the 2005 book “Prescription for a Healthy Nation.” Just the 1983 increase in the federal tax on cigarettes saved 40,000 lives per year.

In effect, the most promising cure for lung cancer didn’t emerge from a medical research lab but from money-grubbing politicians. Likewise, the best cure for obesity may turn out to be not a pill but a tax.

These days, sugary drinks are to American health roughly what tobacco was a generation ago. A tax would shift some consumers, especially kids, to diet drinks or water.

“Soft drinks are linked to diabetes and obesity in the way that tobacco is to lung cancer,” says Barry Popkin, a nutrition specialist at the University of North Carolina and author of the excellent new book, “The World Is Fat.” He warns that the cola industry will spend vast sums fighting the proposed tax.

One of industry’s objections is that soft drinks aren’t the only problem. That’s true, and I’d love to see a “Twinkie tax” as well. But evidence is accumulating that sugary drinks are a major contributor to obesity because of the evolutionary heritage I mentioned at the outset: Except for soups, liquid calories don’t register with the body, according to Professor Popkin and other specialists.

If you have a snack, even something unhealthy like potato chips, you’ll eat less at your next meal. But have a Coke, and despite all those calories, you’ll still eat just as much. Indeed, according to some studies, you’ll actually eat more.

“These findings raise the possibility that soft drinks increase hunger, decrease satiety or simply calibrate people to a high level of sweetness that generalizes to preferences in other foods,” said a peer-reviewed article last year in the American Journal of Public Health.

The average American consumes about 35 gallons of nondiet soda each year and gets far more added sugar from soda than from desserts.

Barack Obama has pledged to move toward a system of universal health coverage, and Democrats mostly see health care reform as a matter of providing access to doctors. Access and universal coverage are indeed essential, but there’s only so much doctors can do in this environment.

One priority must be a public health campaign to change social behavior. A starting point is to recognize that risky teen behavior these days can involve not just alcohol, drugs or sex but also extra-large Cokes.

One new study estimates that 24 million Americans now have diabetes, more than four times the number in 1980. The total direct and indirect cost to Americans is $218 billion each year — an average of $1,900 per American household. Each year, diabetes contributes to the deaths of more than 200,000 Americans.

Part of the solution must come from reforming agriculture so that we stop subsidizing corn that ends up as high fructose corn syrup inside soft drinks. Unfortunately, Mr. Obama on Wednesday chose Tom Vilsack, the former governor of Iowa who has longstanding ties to agribusiness interests, as agriculture secretary — his weakest selection so far.

The soft-drink industry will throw enormous resources into defeating the proposed New York tax on sugary drinks. We should stand behind Governor Paterson’s bold gesture. He is blazing a path that other states should follow.

Losing weight is never easy, but one of the most effective diets would start with a soft drink tax.

The Bailout Culture and America

Our Bailout Culture and the Beauty of Bankruptcy

By Selwyn Duke

The story of the Prodigal Son teaches a beautiful lesson about repentance and forgiveness.  As you may know, it involves a lazy, irresponsible young man who insists upon taking his share of the family inheritance immediately and striking out on his own.  He then proceeds to squander it on a dissolute lifestyle and ends up destitute, living like an animal.  Duly chastened and humbled and purged of his spirit of entitlement, he approaches his father in contrition and asks for aid, saying that he would be satisfied to just be treated as a servant.  The father, overwhelmed with joy, forgives his son, proclaims him "found" and holds a celebration commemorating his return.  Of course, the idea is that he was "found" spiritually; he had developed wisdom, the capacity to not just manage money, but life.

Now, after 2000 years, we have gone from Prodigal Son to prodigal sin, and I imagine that today the story might unfold quite differently.  The son's problem would probably be related via cell phone, be chalked up to a matter of money, and remedied not with character formation but cash flow.  

We have all seen this new story, these parents who will bail their children out of trouble -- financial and otherwise -- time and again, never allowing them to learn through suffering the consequences of bad decisions.  I can think of one case in particular wherein a couple I know of spent a lot of money to ensure that their teenage son wouldn't temporarily lose his driving privileges after a traffic infraction.  When I mentioned to the mother that her bailout didn't teach responsibility, she sheepishly said something to the effect of how she couldn't help herself. 

Yet the truth is that many of us, with children and without -- and most notably right now those in government -- can't help ourselves.  We seem to have forgotten that not allowing people to suffer consequences has consequences.  The reason for this was perhaps expressed best by English philosopher Herbert Spencer, who said, "The ultimate result of shielding men from the effects of folly is to fill the world with fools."

Given what figures most prominently in media and minds right now, it's not hard to know what I'm referring to.  Main Street wants to bail on Wall Street and Detroit, not bail them out, and more sympathetic I could not be.  We may very well be throwing good money after bad, and, regardless, the people doing the throwing aren't throwing away their own cash.  But they sure pitch like Roger Clemens; it's stimulus this, 700 billion that, here a bailout, there a bailout, everywhere a bailout-bailout.  Old McDonald had a country . . . and we're having a cow.

Really, though, if we want to know the reason for these government bailouts, most of us need look no further than the mirror.  Sure, people may say they oppose bailouts, but it's not usually true.

Most Americans have no problem with them at all, as long as they're the ones getting bailed out.

This isn't really surprising, as people tend to refuse money like politicians refuse votes, which is why votes are so often bought with money.  Yet the problem goes far deeper than the financial; it stems from the philosophical.  As I indicated earlier, we have become a bailout culture. Parents bail out children lest the little snowflakes have their feelings hurt.   Schools then follow suit, bailing out students through social promotion and an overall lack of accountability.  Emily Friedman wrote about some examples of this, such as a policy known as "Zeros Aren't Permitted" (except when embodied in school administrators) at one Boston area middle school, which gives lazy students the opportunity to do unfinished homework in school, which I guess makes it schoolwork.  The title of Friedman's piece asks, "Are Children Coddled?" but such a question is anachronistic.  We long ago passed the coddling stage and transitioned into the "exaltation of stupidity and shiftlessness" stage.

Without a doubt, we continually bail out those devoid of brains, ambition and/or industriousness, whether they be rich or poor, domestic or foreign.  For instance, there are people -- and many of them are Daddy Warbucks --  who insist on building homes in areas prone to floods, hurricanes and earthquakes and who do not or cannot get insurance to cover their dangerous living.  Yet they don't have to fear an act of God because they can count on an act of government, meaning, they will get money that often comes from people of far more modest means. 

A bailout is really a handout, and the aforementioned variety is branded "disaster relief," but it takes many forms and masquerades under many titles.  We bail out illegal aliens when they cross our border for medical care, and many Americans want to offer them another bailout known as amnesty.   We bail out the lazy as well as the needy with welfare, food stamps and other programs.  Then consider that some politicians want to bail out the intellectually lazy (and corrupt) as well.  Yes, believe it or not, they want to give our money to the ailing newspaper industry.    

Now, don't misunderstand me, because I firmly believe in charity.  When a private entity bails out someone who through no fault of his own is in dire straits, it's a beautiful example of man's humanity to man.  Moreover, even a correct understanding of our Constitution -- which is as rare as accountability today -- allows state and local governments to establish a social safety net.  (In keeping with the principle of subsidiarity, however, the private sector should be the first line of defense here.) 

But our bailout culture is a perversion of charity -- and one that touches everything.  Putting our heads together, we could probably fill 10,000 more lines with something to the effect of, "We bail out so-and-so when we _____," but the point has been made.  Far more often than not nowadays, we don't teach people how to fish; we give fish to those who could cast a line but would rather fish for others' funds.   We tend to not practice healthy charity but facilitate irresponsibility.   

In light of this, why would we be surprised that irresponsible politicians elected by irresponsible people want to lavish money on irresponsible businesses?  Our problem isn't isolated to finances; it is part of a deep cultural malaise permeating every national pore.  To think otherwise is like looking at the Prodigal Son and thinking the problem was just one of finances.  In both cases, it reflects a moral defect, an irresponsibility that is only corrected through exposure to consequences.

Of all our bailout babies, perhaps the best example of a bad example is the Prodigal State, California.  It now may be out of cash in February, and some have floatedthe idea that it should receive a federal bailout along with everyone else who isn't you or me.  But I say let Ca and every other profligate entity collapse under its own weight.  There is beauty in bankruptcy.

People are people, be they in the Bible, business, government or grammar school; they all operate by the same principles.  Politicians may dress smartly and know how to tie a fine Windsor knot, but money burns a hole in their pockets just as it does with a toy-craving ten-year-old.  And this is the problem in Ca; its government has descended into the immorality of über-statism, as it vainly tries to play the paternal role with a juvenile sense of responsibility.  A bailout would only perpetuate the foolishness and postpone the day of reckoning.

Bankruptcy, on the other hand, is one of the best ways to bring big government to heel.  For just as a compulsive gambler will continue playing the casinos until his well runs dry -- and giving him money just delays the inevitable -- statist politicians will keep spending until there is nothing left to spend.  So let state and local governments shut down and suspend services.  Let them twist in their own ill wind.  Let them languish in a self-created debtors' prison.  In the same way the bankruptcy of a corporation can lead to a sale of assets that will allow more prudent heads to take the helm, government collapse can lead to necessary restructuring.  Failure can shrink the big government of profligate statists just as it does the big heads of profligate young men.   

Today we have many prodigal sons but precious little repentance.  They don't need to be bailed out but bawled out -- by life -- because irresponsible people rarely change their ways unless forced to do so.  And if allowing them to be disciplined by circumstances they created themselves is beyond us, then we are simply a Prodigal Nation, and such a place cannot long exist.  After all, in just the way that failure to remove a gangrenous limb results in the death of the body, the body of a nation suffers the same fate when it doesn't allowed defective parts to be reformed or replaced. 

Remember, to gravitate toward a system that seeks to bail everyone out is to move toward the standard of ". . . to each according to his needs."  This didn't work very well in the Soviet Union, and I don't know how much better we will look once our wall -- that ever-growing one between responsibility and state -- finally falls.

The Best Idea I Have Heard so Far...

If I Were President
Michael Reagan
Wednesday, December 17, 2008

Who needs gigantic bailouts when there are far less costly and more effective ways to deal with the economic crisis, such as those I'd use if I were president of the United States.

To begin with I'd give the economy a powerful shot in the arm by eliminating a lot of federal taxes that are hobbling economic growth.

There is a better way to boost our economy than the socialistic programs now being both used and considered. It's called free enterprise, and it works by loosening the death grip now strangling America's small business community, which provides the majority of jobs in this country.

I'd start by reinstating the tax deductibility of the interest rates we now pay banks on vacation or second homes, cars, motor homes, RVs, boats and yachts.

Instead of following the lead of the Governor of New York by putting a luxury tax on these items -- thereby killing the free market -- I'd revive the market, and those houses in foreclosure and owned by banks would find eager buyers seeking to invest in real estate.

If buyers knew they could write off the interest that they would be paying a bank on the loan, you wouldn't need a government bailout, because the people with money to invest -- not government -- would be the ones who would bail out the economy.

Giving them a tax break for getting involved in the economy by investing in income-producing real estate is the sensible way of bailing out the marketplace.

What are we thinking when we plan to give General Motors a bailout with money we don't have? Why should we need to borrow from our grandchildren and great-grandchildren and their offspring?

Instead, why not allow us to deduct the interest on a second home we might buy? Do the same with boats, with RVs, with second homes, with automobiles.

We'd undo much of the damage the downturn in the economy has done to our retirement accounts, causing most of us to lose at least 25 to 30 percent or our retirement savings.

Moreover if we also cut taxes on capital gains to zero and slash corporate taxation by half, the economy would grow and the nation's economic engine would be restarted and roar into life, and it would all happen with raising one cent of taxes.

We'd do it all without socialism and without bailouts.

Think about it. Giving the automakers huge barrels of money doesn't do a single thing about motivating people to buy cars, and if people don't have an incentive to buy cars most won't, and you're right back where you started, only a lot poorer.

People need an incentive to buy a car. What's the incentive? If, however, you give them a tax break as a reward for buying a car they have an incentive.

With the economic downturn, the boat business is in the tank. Nobody is buying boats, yet the Governor of New York wants to kill the boat business by adding a five percent luxury tax to the cost of buying a boat? Why not just order boat sellers to go out of business and be done with it?

Years ago a tax on yachts was imposed and the results on the economy were staggering. I was in the business of selling boats at the time, and the taxes simply killed the business in the United States.

The tax did boost the economy, except it wasn't the U.S. economy. People kept buying boats, but not here. They bought them in Venezuela and Mexico and a host of other foreign countries, had them registered in those countries, and then had somebody take them to the United States.

Why? To avoid the taxes.

Make the interest buyers pay on cars, boats, motor homes, second homes and investment real estate deductible, and you won' t need bailouts. The American people will do the job themselves. 

Shoes

President Bush in Iraq: If Only He Had Caught Those Shoes…

By Kathleen Troia “K.T.” McFarland
National Security Expert

After I watched the news clip of Bush’s Baghdad press conference last night — the one with the shoe-throwing reporter — I switched to the final installment of the HBO mini-series, “House of Saddam.”

I couldn’t help but note the irony. Was Saddam Hussein’s Iraq the world that reporter wants to return to? Forget about the throwing a shoe, Saddam Hussein would have had that reporter killed merely for writing critically of his regime. Can you imagine what Saddam would have done if that reporter had thrown a shoe at him, not only bonking him, but offering the ultimate Arab insult? That reporter would have been gunned down on the spot and his body fed to the dogs.

According to Salameh Nematt, former Washington Bureau Chief for the respected Arab newspaper Al Hayat, criticizing Saddam Hussein wasn’t the safest thing to do. Neat spent much of his career based in Jordan, exposing Saddam Hussein’s brutalities, and condemning his use of chemical weapons during the Iran-Iraq war. Saddam put him on a hit list and ordered his assassination, along with a number of other Iraqi dissidents who had fled to Jordan. The only reason Neat is alive today is a friend in Jordanian intelligence service tipped him off to the assassination plot, and Nematt was able to escape the Middle East to make a new career reporting from…America!

Iraqi protestors have argued that the reporter, Muntadar al-Zaidi, was merely expressing his opinion, under Iraq’s free press. I only wish President Bush, who is a great athlete, would have caught those shoes and thrown them back at Mr. al-Zaidi instead of gracefully dodging the shots. Because, in some eyes, Mr. al-Zaidi is the ultimate ingrate who deserved an insult, too.

There is no doubt the Iraq war has gone on too long, and cost too much in lives and treasure of both Iraqis and Americans. But in the rush to condemn President Bush, let’s not forget what President Saddam Hussein was really like. And let’s not forget that a free press and freedom of speech — the privileges Mr. al-Zaidi is so eager to take advantage of — weren’t free. They were paid for by the lives of his fellow countrymen and mine.

As the United States prepares to leave Iraq and Mr. Bush prepares to depart the presidency, let’s hope Mr. al-Zaidi and his colleagues and countrymen not only appreciate that gift, but are willing to make the sacrifices necessary to maintain it.

No More Bailouts

No More Bailouts
David Limbaugh
Friday, December 12, 2008

If our government's economic experts really knew what they were doing, they wouldn't be frenetically experimenting with the people's money, treating billions like nickels. They wouldn't be so hellbent on dampening expectations and instilling fear as if oblivious to the real impact of public psychology on the economy.

I'm just not buying their doomsaying anymore. Even if they're right and we do end up in a full-scale financial meltdown, at least it will be finite and America's best days will still be ahead of us. But if we don't stop this panic-driven government intervention madness now, the chances are we'll still face a major meltdown and pass the point of no return into the bottomless pit of socialism.

The auto bailout and future proposed gargantuan government interventions must be rejected.

Government bailout architects ominously warned that unless we adopted their original "$700 billion" bailout proposal to purchase distressed mortgage assets, we'd face catastrophic economic consequences rivaling or exceeding the Great Depression.

Just weeks later, these same architects betrayed their own warnings and said their do-or-die plan would not work after all. Buying the troubled assets wouldn't inject capital into the banks quickly enough, so instead the government would have to distribute the money directly to major financial institutions.

But whatever happened to the government's mollifying assurance that if we pursued the original asset purchase plan, which involved buying the assets at a bargain, taxpayers might even make money on the deal? How about its promise that its involvement would be short-term? Obviously, the government's promises were more short-lived than its intervention.

Predictably, all kinds of supplicants showed up at government's doorstep looking for their own "rescue" funds. And we're just getting warmed up.

While Congress probably never should have authorized the original bailout plan, there is at least a plausible rationale to draw the line in the sand now. As others have noted, most bailouts to date have been to the financial sector. But once we open the door to the automakers, on what non-arbitrary basis do we deny future private industry petitioners, especially when their collective failure could arguably have a major impact on the economy?

Free market capitalism is obviously not perfect, but it's the least imperfect economic system, and its pricing mechanism does an infinitely better job of allocating resources and rationally picking winners and losers than government planners could do, even if they had the foresight of Nostradamus on his best day.

Keynesian interventionist types insist that the intrinsic weaknesses of capitalism require large-scale government interventions from time to time, such as FDR's New Deal. Nonsense. While there are certainly cyclical ups and downs inherent in market economies, there is usually scant justification for such major government adjustments.

Indeed, but for liberally biased historians, we'd understand that FDR's actions exacerbated and prolonged the Great Depression and that Obama's planned New Deal would do likewise. The financial meltdown was not caused primarily by too much capitalism but reckless government policies that interfered with the market's pricing mechanism, such as mandating un-creditworthy real estate loans.

Even if we draw the bailout line now, we must understand that we've still seen an enormous government intervention under a Republican president's watch, which will make future bailout proposals difficult to credibly oppose.

Some contend there is a silver lining in these bailouts, namely that their inevitable failure will teach the lesson that they don't work and cause our rededication to market principles.

But this ignores that a large percentage of the political class has no fealty to market principles. The Harry Reids and Nancy Pelosis of the world are licking their lips in anticipation of the opportunities for government intervention this crisis presents, as Obama's chief of staff, Rahm Emanuel, brazenly admitted.

In the typically arrogant spirit of social planners, they are poised to micromanage an industry they know less about than they know about balancing the federal budget. Worse still, they refuse to divorce their self-assigned mission of restoring financial stability to the industry from their policy and political goals of imposing environmental mandates and protecting their union voting constituencies.

It's time to take our medicine, even if that means bankruptcy and the restructuring of an industry whose wages have long defied market standards. Any resulting hardships are sad and troubling, but the alternative is worse.

If we don't stop this runaway freight train now, there might be no extricating ourselves from the government planning model, which would be disastrous for America's unique and world-leading prosperity and liberty.

Conservatives better start screaming bloody murder, or the market enemies soon to dominate two of the three branches of the federal government with a lust for the third could build a socialist momentum that would be difficult to restrain, much less reverse.

Enough is enough.

Five Short Economics Lessons

Five Short Economics Lessons For the Age of Obama
John Hawkins
Friday, December 12, 2008

"If all we want are jobs, we can create any number -- for example, have people dig holes and then fill them up again, or perform other useless tasks. Work is sometimes its own reward. Mostly, however, it is the price we pay to get the things we want. Our real objective is not just jobs but productive jobs -- jobs that will mean more goods and services to consume." -- Milton Friedman

Barack Obama and the Democratic Party seem to have fallen in love with the idea of "make work" jobs. In other words, they're going to take money from taxpayers and then use it to "create green jobs," work projects, and other marginally useful government programs. Then, to add insult to injury, these very same politicians who've taken the money out of working people's pockets will pat themselves on their backs for being compassionate enough to put people to work.

What shouldn't be missed is the other side of the equation: much of the money paid in taxes to the government would otherwise be spent, thereby creating jobs. Furthermore, since the government is less efficient than private industry and because in most cases, people are better able to fill their own needs with their own money than the government can, the "make work" job process is inherently inefficient.

That's why one of the worst things the government can do, particularly in a recession, is to try to create "jobs programs."

"Were we directed from Washington when to sow, and when to reap, we should soon want bread." -- Thomas Jefferson

The federal government is inevitably slower, dumber, and less competent than private industry. Moreover, just about every truly catastrophic economic event that has occurred in the last century -- from the depression to the savings and loan crisis to the current housing crisis -- all have at their root government intervention in the market.

That's why the partial nationalization of this country's banks and auto industry should absolutely terrify people. There is absolutely nothing that should make anyone think that an "auto czar" or some other bureaucratic flunky who's answerable to Congress would do anything to help make these businesses more viable over the long-term. It's quite the opposite, actually.

Over the long haul, the more intimately our government is involved in the market, the more damage it will do to our economy.

"Suppose I hire you to repair my computer. The job is worth $200 to me and doing the job is worth $200 to you. The transaction will occur because we have a meeting of the mind. Now suppose there's the imposition of a 30 percent income tax on you. That means you won't receive $200 but instead $140. You might say the heck with working for me -- spending the day with your family is worth more than $140. You might then offer that you'll do the job if I pay you $285. That way your after-tax earnings will be $200 -- what the job was worth to you. There's a problem. The repair job was worth $200 to me, not $285. So it's my turn to say the heck with it. This simple example demonstrates that one effect of taxes is that of eliminating transactions, and hence jobs." -- Walter Williams

The Democrats' answer to every problem is "raise taxes" and now that they have a large majority in D.C., they will get to do exactly that over the next few years.

However, the more you raise taxes, the more economic activity is retarded, and the more the economy slows. We cannot massively expand the size of the federal government and erase the deficit almost entirely on the backs of the rich without dramatically slowing down the growth of our economy over the long term.

Since the current and future prosperity of this country hinges on the economy continuing to grow, we need to do everything we can to keep taxes as low as possible for everyone -- poor, rich, and middle-class.

"We don't have a trillion-dollar debt because we haven't taxed enough; we have a trillion-dollar debt because we spend too much." -- Ronald Reagan

It's ironic that Reagan mentioned a "trillion-dollar debt" in that quote because we've thrown away far more than that on the bailout so far and are on pace to run trillion dollar deficits over the next few years.

We are selling our children into slavery via debt -- to give seniors more comfortable retirements, to hand out goodies to interest groups, and to bail out failing companies.

Worse yet, the majority of our political class in D.C. doesn't seem to care that we're selling our nation's economic birthright for a bowl of porridge.

"It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy...What is prudence in the conduct of every private family, can scarce be folly in that of a great kingdom. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage." -- Adam Smith

Because our tax rates are creeping ever higher and the number of regulations on businesses is continuing to expand, American companies are become less competitive with our overseas rivals in an increasingly global world.

There's a right way and a wrong way to handle this.

The right way is to cut taxes, decrease regulations, and work to open up more foreign markets to our goods. This would help keep goods here cheap, help American businesses become more competitive, and help spur job growth.

The wrong way to deal with this problem would be to increase the cost of foreign goods through trade barriers in order to keep them uncompetitive with American products. That would make goods we buy more expensive, make it more difficult for American companies to compete globally, and slow job growth.

For the United States to remain an economic super power, we need to have competitive businesses that employ productive workers. The American people have proven up to the task for over 200 years and will remain so as long as the government doesn't get in our way.

Is this what voters expect?

The Altar of Convenience

Attention Wal-Mart Shoppers
Ken Connor
Sunday, December 07, 2008
If actions speak louder than words, what do recent events at a New York state Walmart say about the state of American culture?  On "Black Friday," two thousand people burst through the doors of a Walmart store in Long Island at five a.m., trampling an employee to death in a mad dash to get to sale items before the person next to them.  Signs of America's rampant consumerism have existed for decades, but this tragedy takes the cake.

With only minutes to spare before the discount store opened, the crazed crowd pushed through the doors, knocking Jdimytai Damour down and breaking the doors off their hinges.  As the crowd surged, people stepped on Damour and knocked over other employees who struggled to help him.  Two thousand ravenous shoppers, many of whom had no idea what was going on, shoved and pushed each other in a mad rush.  The selfishness is clearly seen by one employee's experience: "When they were saying they had to leave, that an employee got killed, people were yelling 'I've been [in] line since yesterday morning'... They kept shopping."

This tragedy points to the selfishness of the human heart and demonstrates that greed is not confined to the scions of Wall Street.  Quite the contrary, these Main Street shoppers pursued their own materialistic impulses at the expense of the needs of those around them.  They were focused on themselves, intent on getting to the deals first.  Their trampling of Mr. Damour, each other, and the employees who were trying to help him, exhibits hearts that care more about saving $50 on an HDTV than about the health and safety of their fellow man.

Sadly, this event is not unique.  Just a couple of weeks ago, a number of people watched a teenager commit suicide live via webcam.  Some, with ghoulish delight, goaded him on as he took a large dose of antidepressants, saying things like "Oh, that's not enough to kill you" and "Go ahead and do it."  Only after the young man had been lying on his bed for hours did someone finally contact the police.  The anonymity of the internet enabled many of these voyeurs to engage in a perverse form of entertainment.  Their "fun" contributed to the death of a young man.

This self-centered disregard for human life reminds us of another episode of pathological neglect that occurred in 1964 in Queens, New York.  Catherine Genovese was knifed in the alleyway leading up to her apartment.  She screamed for help, but none was forthcoming.  Several lights went on in the windows of the neighboring apartment complex.  One man shouted from the safety of his apartment, "Let that girl alone!"  But no one bothered to call the police until more than fifteen minutes after the attack.  By the time the police arrived, it was too late.

Why wouldn't these neighbors place a simple phone call when they heard the young woman's screams?  One man, who eventually called the police "after much deliberation," explained, "I didn't want to get involved."  Another man saw the killer attack the woman again from a crack in his door, but didn't call the police.  His reason?  "I was tired.... I went back to bed."

There is a common thread that runs through this 1964 case of willful abandonment, the sordid online suicide, and the Walmart trampling: these tragedies occurred because individuals were looking out for their own interests rather than that of their fellow man.  Their actions led to the deaths of their neighbors, and for what?  A couple of hours of "fun" online voyeurism?  A little extra sleep?  $50 off of a tv?

How did we get to this point in "the home of the brave"?  Why do so many Americans exhibit so little concern for their neighbor?  Doubtless, there are many causes, but prominent among them is our willingness to sacrifice core principles of human dignity on the altar of convenience.  We live in a culture that is so self-centered that we are no longer expected to deal with the "inconvenience" of an unwanted baby.  Nor can we be bothered to care for our aging parents.  Just stick them in a nursing home at government expense and forget about them—or better yet, encourage them to take the "dignified" way out.  We selfishly maintain that our "progress" must continue through "scientific research" free of ethical restraints, notwithstanding that such "progress" kills or debases nascent human life.  Our convenience, our comfort, our self-centeredness trumps the value of someone else's life.

Mother Teresa well understood the destructive impact of radical selfishness.  Regarding abortion she declared, "[I]f we accept that a mother can kill even her own child, how can we tell other people not to kill one another? ... Any country that accepts abortion is not teaching its people to love, but to use any violence to get what they want.  This is why the greatest destroyer of peace and love is abortion."  Mother Teresa rightly understood that when one form of killing is accepted on the basis of personal convenience, other forms of violence will inevitably follow.

The trampling of Jdimytai Damour should be a wake-up call to each one of us.  It should cause us to pause and consider whether we place too high a value on our own convenience and our own possessions.  We should examine our hearts and ask ourselves whether we any longer have the capacity to sacrifice our own desires for the good of another.  We are missing the big picture if events like these capture our attentions just long enough for us all to gasp and say, "How awful!", then turn back to our shopping carts and our self-centered lives.

What Mumbai teaches us about the importance of an effective missile defense system

I wonder what missile-defense opponents would say to refute the conclusion of this article...

December 04, 2008

First lessons from the Mumbai Massacres

By James Lewis

It now appears that 10 commando-trained terrorists with Pakistani jihadist training were able to kill at least 172 people and wound almost 300 more in Mumbai, India, over some five days. That suggests major failures among Mumbai's first responders, notably its armed police. It is likely, though not certain, that such an attack would have been stifled much more quickly in the United States, Israel, and perhaps parts of Europe, Russia and China. Similar terrorist attacks in those countries have been typically less damaging, although there have been cases of successful mass casualty attacks there, too. 

India has faced jihadi terror attacks in the Kashmir for decades. It has a great deal of experience in coping with such attacks, but that experience has apparently not sufficiently benefited major cities like Mumbai. India also has apparently failed to penetrated the Pakistani intelligence service, the ISI, which itself has been penetrated by jihadi terror networks for decades. While some warnings were reportedly received from the United States, they were not passed up the chain of command, or not recognized against the background noise of less significant warnings.

The Mumbai carnage has triggered a major political crisis in the state of Maharashtra and at the national level in India. The Mumbai Massacre represents an immense loss of face and prestige for a modern India that has been developing with commendable speed and competence.

This sense of shock could ultimately be positive, since it carries the seeds of self-correction. The United States and Britain may be able to play a role in helping to train a layered anti-terrorist defense system for India that should be far more effective in the future.    In the age of terrorism, no civilized country can be left unprotected, simply because the jihadis are in a state of war against so many countries that they can simply shift targets if some civilian centers are left unprotected. There are no permanently safe places. 

Finally, the Mumbai Massacres teach some general lessons about the failures of intelligence infiltration in Muslim countries like Pakistan, which has a direct bearing on its fragile command and control of its nuclear weapons and missiles. The elected Pakistan government plausibly had no clear warning of the plot against Mumbai. Its intelligence apparatus, the notoriously fragmented and treacherous ISI, openly allows terrorist groups like Lakshar-e-Taiba (LeT) to run quasi-independent jihadi operations against India. If Pakistan cannot control LeT and its ilk even after the current crisis in its relations with India and the United States, it must be considered to be a failed state, a wild card in the nuclear proliferation game. An utterly unreliable Pakistan would  carry major implications for American policy in Afghanistan and the Gulf as well.

When Iran obtains its nuclear bomb sometime next year, it will also need to maintain foolproof command and control over its weapons. Whether it can do so in the notoriously chaotic context of a Muslim state with multiple tribal, clan, and ideological factions is an unanswered question. In Iran, there is the additional possibility of a martyrdom ideology taking control of its nuclear weapons.

                                         --- o ---

Some specifics.

First, the failures of local first responders in Mumbai. Even at this time, so soon after the massacres, there are many indications that early responding police forces simply failed to properly identify the attackers, to isolate and neutralize them. A press photographer on the scene reported that armed Indian police simply did not shoot back at the attackers.  That could be because of fundamental difficulty in distinguishing friend from foe, or because of a lack of non-commissioned tactical officers, or their equivalents, in the Mumbai police. 

A set of SWAT teams could have taken over very early to do the job. The terrorists made difficult targets because they were trained to kill and keep moving, and they may have booby-trapped rooms, buildings, and bodies. They were difficult to distinguish from ordinary civilians. Nevertheless, when a gunman starts to shoot civilians, that is an unmistakable giveaway, and an organized tactical squad must be able to pinpoint each perpetrator, track them, pin them down, and neutralize them. The first responding police forces signally failed to do so in Mumbai. This is elementary small unit tactics. In the United States, police have such widespread experience with gun crime that very fast, on-scene counterattacks by local police would be nearly assured. That may be the reason why we have not (yet) seen such attacks in the United States.

Tactical command and control is crucial for immediate armed response. It requires the equivalent of a non-commissioned officer corps that is highly competent, and that is authorized to make local decisions without second-guessing by higher authority. Further, it requires excellent local communication. In the age of cell phones, photos of the attackers should have been transmitted to police headquarters and disseminated in hours if not minutes.

In the 9/11/01 attacks in New York City then-Mayor Giuliani established a command post near Ground Zero, and kept in personal touch with first responders as the disaster unfolded. That should theoretically not be necessary, but to coordinate different agencies, with (at that time) different communication systems, competing jurisdictions, and different tactical procedures may require ad hoc control by political, police or military leaders. The failure of first responders in Mumbai suggests that competing command centers were unable for some days to establish a coherent chain of command, communication, and control.

These are all problems that can and have been solved elsewhere in the world. In modern India, with state-of-the-art technology and an educated work force, such organizational problems can be solved if the political will exists to make it happen. If this generation of  politicians cannot make that happen they should resign en masse.

The Pakistani end is even more snarled and resistant to solution. Pakistan is a dysfunctional state, in which ideological, tribal and clan alliances often count for more than national loyalties. While the ruling party may not have known about the plot, it certainly knew about Lashkar-e-Taiba and other long-existing jihadist networks which have been operating out in the open, often with publically expressed support from the Pakistan military.

Pakistan is a nuclear power, and therefore is a classic case of a fragile Islamic state with weapons of mass destruction and ballistic missiles potentially on hair-trigger alert. Pakistan's nuclear status makes it a safe haven for terrorist groups, since India cannot ever risk an open attack on its territory. The nuclear option therefore serves to protect terrorist outrages against democratic and fast-modernizing nations like India. As nuclear weapons spread ever faster in the next coming years, the identical problems of shaky command and control, or worse, will appear in Iran and perhaps other Islamic countries that are seriously exploring the nuclear option --- Syria, Saudi Arabia, Lybia, Egypt. In the case of Iran, the danger is made worse by the continued influence of an Armageddon cult in the ruling clique, including President Ahmadinejad and de facto leader Ayatollah Khamenei. If Iran obtains a workable bomb and delivery vehicles, its inherent instability, characteristic of so many Muslim countries, will continue to threaten the world for decades to come, even if adequate command and control is maintained over its WMDs. That is simply because Iran, of all countries in the world, may have a doctrine of nuclear use that contemplates a non-defensive employment of nuclear weapons.

It cannot be overemphasized for that reason that Iran and Pakistan must be surrounded by a picket system of anti-missile systems. That kind of state-of-the-art antimissile defense system already exists on US naval vessels in the Gulf, the Indian Ocean and the Mediterranean, in the most explicitly threatened country of Israel, and now in Saudi Arabia and the Gulf States. The Bush Administration has made great strides in developing and fielding anti-missile defenses, which may be its most significant and historic contribution to stabilizing the nuclear arms race.

There is no higher priority than to continue to develop such defenses at emergency speed. If the next administration fails to do so, threatened countries like Israel, India, Japan, South Korea and Taiwan are surely going to do it themselves. We can therefore expect laser-based missile defenses to emerge as quickly as possible, giving the first genuine defensive counter to weapons of mass destruction since the beginning of the nuclear age in the 1940s.

A wholehearted American push for better missile defenses will speed up that process. We already have state-of-the-art defenses in the Atlantic, Pacific, Alaska, the Mediterranean, the Gulf, Eastern Europe and so on. We have the naval resources to place them almost anywhere in the world. A new generation of laser defenses will be directed from Boeing 747 platforms, potentially allowing even wider coverage. All of the endangered front-line states depend on us to a considerable extent --- but they will go their own way if the United States fails to lead. 

So I have a confession to make - while I strenuously opposed Barack Obama's candidacy for president, I am pulling for him to be a success when he takes office.  David Brooks seems to think he is on the right track...

November 21, 2008

OP-ED COLUMNIST

The Insider’s Crusade

By DAVID BROOKS

Jan. 20, 2009, will be a historic day. Barack Obama (Columbia, Harvard Law) will take the oath of office as his wife, Michelle (Princeton, Harvard Law), looks on proudly. Nearby, his foreign policy advisers will stand beaming, including perhaps Hillary Clinton (Wellesley, Yale Law), Jim Steinberg (Harvard, Yale Law) and Susan Rice (Stanford, Oxford D. Phil.).

The domestic policy team will be there, too, including Jason Furman (Harvard, Harvard Ph.D.), Austan Goolsbee (Yale, M.I.T. Ph.D.), Blair Levin (Yale, Yale Law), Peter Orszag (Princeton, London School of Economics Ph.D.) and, of course, the White House Counsel Greg Craig (Harvard, Yale Law).

This truly will be an administration that looks like America, or at least that slice of America that got double 800s on their SATs. Even more than past administrations, this will be a valedictocracy — rule by those who graduate first in their high school classes. If a foreign enemy attacks the United States during the Harvard-Yale game any time over the next four years, we’re screwed.

Already the culture of the Obama administration is coming into focus. Its members are twice as smart as the poor reporters who have to cover them, three times if you include the columnists. They typically served in the Clinton administration and then, like Cincinnatus, retreated to the comforts of private life — that is, if Cincinnatus had worked at Goldman Sachs, Williams & Connolly or the Brookings Institution. So many of them send their kids to Georgetown Day School, the posh leftish private school in D.C., that they’ll be able to hold White House staff meetings in the carpool line.

And yet as much as I want to resent these overeducated Achievatrons (not to mention the incursion of a French-style government dominated by highly trained Enarchs), I find myself tremendously impressed by the Obama transition.

The fact that they can already leak one big appointee per day is testimony to an awful lot of expert staff work. Unlike past Democratic administrations, they are not just handing out jobs to the hacks approved by the favored interest groups. They’re thinking holistically — there’s a nice balance of policy wonks, governors and legislators. They’re also thinking strategically. As Norman Ornstein of the American Enterprise Institute notes, it was smart to name Tom Daschle both the head of Health and Human Services and the health czar. Splitting those duties up, as Bill Clinton did, leads to all sorts of conflicts.

Most of all, they are picking Washington insiders. Or to be more precise, they are picking the best of the Washington insiders.

Obama seems to have dispensed with the romantic and failed notion that you need inexperienced “fresh faces” to change things. After all, it was L.B.J. who passed the Civil Rights Act. Moreover, because he is so young, Obama is not bringing along an insular coterie of lifelong aides who depend upon him for their well-being.

As a result, the team he has announced so far is more impressive than any other in recent memory. One may not agree with them on everything or even most things, but a few things are indisputably true.

First, these are open-minded individuals who are persuadable by evidence. Orszag, who will probably be budget director, is trusted by Republicans and Democrats for his honest presentation of the facts.

Second, they are admired professionals. Conservative legal experts have a high regard for the probable attorney general, Eric Holder, despite the business over the Marc Rich pardon.

Third, they are not excessively partisan. Obama signaled that he means to live up to his postpartisan rhetoric by letting Joe Lieberman keep his committee chairmanship.

Fourth, they are not ideological. The economic advisers, Furman and Goolsbee, are moderate and thoughtful Democrats. Hillary Clinton at State is problematic, mostly because nobody has a role for her husband. But, as she has demonstrated in the Senate, her foreign-policy views are hardheaded and pragmatic. (It would be great to see her set of interests complemented by Samantha Power’s set of interests at the U.N.)

Finally, there are many people on this team with practical creativity. Any think tanker can come up with broad doctrines, but it is rare to find people who can give the president a list of concrete steps he can do day by day to advance American interests. Dennis Ross, who advised Obama during the campaign, is the best I’ve ever seen at this, but Rahm Emanuel also has this capacity, as does Craig and legislative liaison Phil Schiliro.

Believe me, I’m trying not to join in the vast, heaving O-phoria now sweeping the coastal haute bourgeoisie. But the personnel decisions have been superb. The events of the past two weeks should be reassuring to anybody who feared that Obama would veer to the left or would suffer self-inflicted wounds because of his inexperience. He’s off to a start that nearly justifies the hype.

The New Political Economy

The New Political Economy
Charles Krauthammer
Friday, November 28, 2008

WASHINGTON -- In the old days -- from the Venetian Republic to, oh, the Bear Stearns rescue -- if you wanted to get rich, you did it the Warren Buffett way: You learned to read balance sheets. Today you learn to read political tea leaves. You don't anticipate Intel's third-quarter earnings; instead, you guess what side of the bed Henry Paulson will wake up on tomorrow.

Today's extreme stock market volatility is not just a symptom of fear -- fear cannot account for days of wild market swings upward -- but a reaction to meta-economic events: political decisions that have vast economic effects.

As economist Irwin Stelzer argues, we have gone from a market economy to a political economy. Consider seven days in November. On Tuesday, Nov. 18, Paulson broadly implies he's only using half the $700 billion bailout money. Having already spent most of his $350 billion, he's going to leave the rest to his successor. The message received on Wall Street -- I'm done, I'm gone.

Facing the prospect of two months of political limbo, the market craters. Led by the banks (whose balance sheets did not change between Tuesday and Wednesday), the market sees the largest two-day drop in the S&P since 1933, not a very good year.

The next day (Friday) at 3 p.m., word leaks of Timothy Geithner's impending nomination as Treasury secretary. The mere suggestion of continuity -- and continued authoritative intervention during the interregnum by the guy who'd been working hand in glove with Paulson all along -- sends the Dow up 500 points in one hour.

Monday sees another 400-point increase, the biggest two-day (percentage) rise since 1987. Why? Three political events: Paulson's weekend Citigroup bailout; the official rollout of Obama's economic team, Geithner and Larry Summers; and Paulson quietly walking back from his earlier de facto resignation by indicating he would be ready to use the remaining $350 billion (with Team Obama input) over the next two months.

That undid the market swoon -- and dramatically demonstrated how politically driven the economy has become.

We may one day go back to a market economy. Meanwhile, we need to face the two most important implications of our newly politicized economy: the vastly increased importance of lobbying and the massive market inefficiencies that political directives will introduce.

Lobbying used to be about advantages at the margin -- a regulatory break here, a subsidy there. Now lobbying is about life and death. Your lending institution or industry gets a bailout -- or it dies.

You used to go to New York for capital. Now Wall Street, broke, is coming to Washington. With unimaginably large sums of money being given out by Washington, the Obama administration, through no fault of its own, will be subject to the most intense, most frenzied lobbying in American history.

That will introduce one kind of economic distortion. The other kind will come from the political directives issued by newly empowered politicians.

First, bank presidents are gravely warned by one senator after another about "hoarding" their bailout money. But hoarding is another word for recapitalizing to shore up your balance sheet to ensure solvency. Is that not the fiduciary responsibility of bank directors? And isn't pushing money out the window with too little capital precisely the lending laxity that produced this crisis in the first place? Never mind. The banks will knuckle under to the commissars of Capitol Hill. They control the purse. Prudence will yield to politics.

Even more egregious will be the directives to a nationalized Detroit. Sen. Charles Schumer, the noted automotive engineer, declared "unacceptable" last week "a business model based on gas." Instead, "We need a business model based on cars of the future, and we already know what that future is: the plug-in hybrid electric car."

The Chevy Volt, for example? It has huge remaining technological hurdles, gets 40 miles on a charge and will sell for about $40,000, necessitating a $7,500 outright government subsidy. Who but the rich and politically correct will choose that over a $12,000 gas-powered Hyundai? The new Detroit churning out Schumer-mobiles will make the steel mills of the Soviet Union look the model of efficiency.

The ruling Democrats have a choice: Rescue this economy to return it to market control. Or use this crisis to seize the commanding heights of the economy for the greater social good. Note: The latter has already been tried. The results are filed under "History, ash heap of." 

New PBS documentary - A must Watch

Now, whether or not you support President Bush, whether or not you support the wars in Iraq and Afghanistan, whether or not you share the sentiments that we are fighting "evil" in the world by engaging in these conflicts - there is a new documentary that you should see.

It's produced by PBS and it's called Torturing Democracy. It is a fascinating and in depth look at the legal and rhetorical underpinnings of our government's strategies and tactics for interrogation and detention of "terrorists." It is, in my opinion, appalling and very difficult to watch, but most of all, it is important.

So, if you have a spare hour or so, please, watch it. At very least, this is a production partially sponsored by your tax dollars (as it is part of PBS), so you can watch where your money goes.

To Bailout or Not Bailout...

The Bailout's Fault Lines
Charles Krauthammer
Friday, November 14, 2008

WASHINGTON -- Finally, the outlines of a coherent debate on the federal bailout. This comes as welcome relief from a campaign season that gave us the House Republicans' know-nothing rejectionism, John McCain's mindless railing against "greed and corruption" and Barack Obama's detached enunciation of vacuous bailout "principles" that allowed him to be all things to all people.

Now clarity is emerging. The fault line is the auto industry bailout. The Democrats are pushing hard for it. The White House is resisting.

Underlying the policy differences is a philosophical divide. The Bush administration sees the $700 billion rescue as an emergency measure to save the financial sector on the grounds that finance is a utility. No government would let the electric companies go under and leave the country without power. By the same token, government must save the financial sector lest credit dry up and strangle the rest of the economy.

Treasury Secretary Henry Paulson is willing to stretch the meaning of "bank" by extending protection to such entities as American Express. But fundamentally, he sees government as saving institutions that deal in money, not other stuff.

Democrats have a larger canvas, with government intervening in other sectors of the economy to prevent the cascade effect of mass unemployment leading to more mortgage defaults and business failures (as consumer spending plummets), in turn dragging down more businesses and financial institutions, producing more unemployment, etc. -- the death spiral of the 1930s.

Bush is trying to move the LIBOR or the TED spread, which measure credit flows. The Democrats' index is the unemployment rate.

With almost 5 million workers supported by the auto industry, Democrats are pressing for a federal rescue. But the problems are obvious.

First, the arbitrariness. Where do you stop? Once you've gone beyond the financial sector, every struggling industry will make a claim on the federal treasury. What are the grounds for saying yes or no?

The criteria will inevitably be arbitrary and political. The money will flow preferentially to industries with lines to Capitol Hill and the White House. To the companies heavily concentrated in the districts of committee chairmen. To clout. Is this not precisely the kind of lobby-driven policymaking that Obama ran against?

Second is the sheer inefficiency. Saving Detroit means saving it from bankruptcy. As we have seen with the airlines, bankruptcy can allow operations to continue while helping shed fatally unsupportable obligations. For Detroit, this means release from ruinous wage deals with their astronomical benefits (the hourly cost of a Big Three worker: $73; of an American worker for Toyota: $48), massive pension obligations, and unworkable work rules such as "job banks," a euphemism for paying vast numbers of employees not to work.

The point of the Democratic bailout is to protect the unions by preventing this kind of restructuring. Which will guarantee the continued failure of these companies, but now they will burn tens of billions of taxpayer dollars. It's the ultimate in lemon socialism.

Democrats are suggesting, however, an even more ambitious reason to nationalize. Once the government owns Detroit, it can remake it. The euphemism here is "retool" Detroit to make cars for the coming green economy.

Liberals have always wanted the auto companies to produce the kind of cars they insist everyone should drive: small, light, green and cute. Now they will have the power to do it.

In World War II, government had the auto companies turning out tanks. Now they would be made to turn out hybrids. The difference is that, in the middle of a world war, tanks have a buyer. Will hybrids? One of the reasons Detroit is in such difficulty is that consumers have been resisting the smaller, less powerful, less safe cars forced on the industry by fuel-efficiency mandates. Now Detroit would be forced to make even more of them.

If you think we have economic troubles today, consider the effects of nationalizing an industry of this size, but now run by bureaucrats issuing production quotas to fit five-year plans to meet politically mandated fuel-efficiency standards -- to lift us to the sunny uplands of the coming green utopia.

Republican minimalism -- saving the credit-issuing utilities -- certainly risks not doing enough. But the Democratic drift toward massive industrial policy threatens to grow into the guaranteed inefficiencies of command-economy maximalism.

In this crisis, we agree to suspend the invisible hand of Adam Smith -- but not in order to be crushed by the heavy hand of government.

Farm Subsidies

This was included in the video portion of Stossel's special, but I thought it was especially good so I am posting his article on food subsidies...

Who Will Run America?
John Stossel
Wednesday, November 05, 2008Publish Post
Some of you think you went to the polls yesterday to pick someone to run America.

"Who do you want to have run this country?" Chris Matthews asked repeatedly on MSNBC.

"One of these guys is going to be running the country," said Michael Goodwin of the New York Daily News.

Really? Run the country?

"That has to be a joke -- or a misunderstanding," said George Mason University economist Walter Williams on my recent TV special, "John Stossel's Politically Incorrect Guide to Politics".

Williams pointed out that the White House doesn't govern what happens in your house. And a president certainly cannot control the economy. We, all of us, run the country.

"Politicians have immense power to do harm to the economy. But they have very little power to do good," Williams says.

The failure to understand this is at the root of many of our problems.

"Most of life is outside the government sector," says David Boaz of the Cato Institute. "Most change in America doesn't come from politicians. It comes from people inventing things and creating. The telephone, the telegraph, the computer, all those things didn't come from government. Our world is going to get better and better, as long as we keep the politicians from screwing it up."

It's easy to find examples of government screwing up what it should have left alone.

Take farming. Every year politicians promise to save the family farm, and this year, Congress passed another $300-billion farm bill. More subsidies after generations of subsidies. John McCain opposed the bill, saying that it will "do more harm than good." But Barack Obama and most of Congress supported it.

"Small farms are important," Rep. Sheila Jackson Lee, a Democrat from Texas, told me.

"I don't think we want anybody in this country to starve," Rep. Randy Kuhl, a Republican from New York, added.

People would starve?

"They go out of business, and then they'd be forced to move elsewhere and find different jobs," Kuhl replied.

That's not starving. That's finding a different job.

"But if they don't have a job, then they're going to starve."

Please.

He and others in Congress also claim that subsidies "insure a food supply for this nation."

That's more nonsense.

It's the free market that "insures" the food supply. You may not know that most farmers get no subsidies. Growers of apples, bananas, broccoli, cabbage, cantaloupe, carrots, cauliflower, grapes, lemons, limes, lettuce, onions, oranges, peaches, pears, pineapples, potatoes, spinach, squash, tangerines, tomatoes and dozens of other crops are on their own. There's no cabbage crisis or pineapple panic.

The farm bill doesn't even keep its other promise: saving family farms.

It's why although Nebraska corn farmer Mike Korth received about half a million dollars in subsidies, he's still against the farm bill. "We sold this on the fact that this is helping the family farmer and the small beginning farmer. It's not. It's hurting them."

That's because most subsidies go to those that are best at manipulating government: the agribusiness giants. Small farms can't compete.

A Federal Reserve Bank of Kansas City study found that the more farm aid a county gets, the more likely it is to lose population.

So not only do farm subsidies cost every taxpayer $550 per year, they also raise food prices by paying farmers not to grow certain crops. Other crops are subsidized and exported, destroying the livelihoods of poor farmers in the Third World.

"This is just a crazy system," said the Cato Institute's David Boaz (www.cato.org). "It's left over from the 1930s, left over from the Depression. And it's a great example of how nothing is as permanent as a temporary government program."

Of course, without subsidies, some farms would go out of business. That's OK, says Walter Williams. It's the creative destruction that makes America strong.

"The guy who delivered ice to my house, he doesn't have a job because we have refrigerators. We're better off. We would have been held back if we had tried to save his job."

I said to Congresswoman Jackson Lee, "If this works so well, why don't we just subsidize everything?"

Her answer? "You don't want to push us."

How frightening is that?

John Stossel's Guide to Politics - Part 1

Part 2

Part 3

Part 4

Part 5 - My Personal Favorite Segment

Part 6

Sleight of Hand that isn't so Slight

If this issue doesn't have a significant impact among the voting public, it is proof to me that people either are not paying attention or do not care what Senator Obama says or does - they will vote for him no matter what.  

Senator Obama has made it a pillar of his campaign that he will "lower taxes for 95% of Americans - any American making less than $250,000".  If you have been paying attention to the campaign you have heard this phrase again and again.  

Now he is changing the threshhold to $200,000, and Senator Biden was quoted as saying the threshold could actually be $150,000.  If this change in policy gets the press coverage it deserves, it should have a significant impact with voters for two reasons.  1)  This change is just one more broken pledge that further undermines Senator Obama's credibility (federal funding of his campaign, standing behind Jeremiah wright)  2)  $250,000 seems like a very high number, affecting only "the rich".  Many people believe "the rich" should pay more taxes, and are fine with this threshold.  Start moving the number down, though, and many voters are going to become nervous that they might soon be included in the proposed tax increases.  I am reminded of the quote that finished the October 22 post.  If you don't remember it, go read it again.

Here is the information about Obama's broken pledge and a video confirming the change in policy.

Taxes

Obama and the Tax Tipping Point

Obama and the Tax Tipping Point:  How Long Before Taxpayers Are Pushed Too Far?, by Adam Lerrick:

What happens when the voter in the exact middle of the earnings spectrum receives more in benefits from Washington than he pays in taxes? Economists Allan Meltzer and Scott Richard posed this question 27 years ago. We may soon enough know the answer.

Barack Obama is offering voters strong incentives to support higher taxes and bigger government. This could be the magic income-redistribution formula Democrats have long sought.

Sen. Obama is promising $500 and $1,000 gift-wrapped packets of money in the form of refundable tax credits. These will shift the tax demographics to the tipping point where half of all voters will receive a cash windfall from Washington and an overwhelming majority will gain from tax hikes and more government spending.

In 2006, the latest year for which we have Census data, 220 million Americans were eligible to vote and 89 million -- 40% -- paid no income taxes.  ...  [T]his will jump to 49% when Mr. Obama's cash credits remove 18 million more voters from the tax rolls. What's more, there are an additional 24 million taxpayers (11% of the electorate) who will pay a minimal amount of income taxes -- less than 5% of their income and less than $1,000 annually.

In all, three out of every five voters will pay little or nothing in income taxes under Mr. Obama's plans and gain when taxes rise on the 40% that already pays 95% of income tax revenues.

The plunder that the Democrats plan to extract from the "very rich" -- the 5% that earn more than $250,000 and who already pay 60% of the federal income tax bill -- will never stretch to cover the expansive programs Mr. Obama promises.

What next? A core group of Obama enthusiasts -- those educated professionals who applaud the "fairness" of their candidate's tax plans -- will soon see their $100,000-$150,000 incomes targeted. As entitlements expand and a self-interested majority votes, the higher tax brackets will kick in at lower levels down the ladder, all the way to households with a $75,000 income.

I am reminded of the poem by Martin Niemöller:

[T]hey came first for [those making $250,000], And I didn’t speak up because I [didn't make $250,000];

And then they came for [those making $150,000], And I didn’t speak up because I [didn't make $150,000];

And then they came for [those making $100,000], And I didn’t speak up because I [didn't make $100,000];

And then . . . they came for me [because I made $75,000] . . And by that time there was no one left to speak up.