Category: too much government

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too much government

Don’t Spend that Penny

Cato Institute’s Chris Edwards succinctly explains that not only does Rep. Boehner’s budget plan fail to cut spending $1 trillion over the next ten years — as advertised — but it “doesn’t actually cut spending at all.”

Zilch. Spending goes up.

“Why doesn’t the House leadership propose real cuts?” asks Edwards. He means identify specific line items that can be cut back — now, as in today or this week — rather than setting optimistic and unenforceable spending caps on future congresses. This especially goes for “caps” that don’t actually cap spending, but allow it to grow by, say, $7–8 trillion over the next decade.

Boehner’s plan allows debt to continue to pile up at historically huge levels. But he’s not alone. Obama has no plan. Reid’s plan? Calling it “smoke and mirrors” gives smoke and mirrors a bad name.

The Penny Plan, introduced by Florida Rep. Connie Mack and endorsed by Kentucky Sen. Rand Paul, has some merit. It would cut the budget by one percent for six years and then cap federal government spending at 18 percent of GDP.

Yes, cutting federal spending by only one penny on each dollar (one percent) for six years, rather than increasing spending by upwards of 7 percent a year under the Congressional Budget Office’s baseline budget, would balance the budget in eight years.

But to restore balance and end the debt crisis, a penny cut has to actually be a cut.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies too much government

A “Progressive” Reform

The money’s running out; the government is on a timeline. Something must be done before going into default.

Of course, the Executive Branch could prioritize spending, fiddle with accounts and still pay the interest on the federal debt as well as pay Social Security recipients — to year’s end. But it looks like the Obama Administration is just as committed to brinksmanship as the (heroic!) Tea Party folks who refuse to raise the debt ceiling.

And now the infamous “Gang of Six” re-emerge with a cockamamie proposal to “solve” the problem, mostly by saying they’ll “cut in the future” but keep mum, for now, what those cuts would be. It’s the typical lily-livered politician’s move.

The worst of the Gang of Six proposal, as fed-spending watchdog Dan Mitchell noticed, is that the alleged spending cuts don’t actually cut spending overall, just (get ready for it…) cut spending over planned increases.

We’ve been hearing this since the Carter era.

Something I haven’t heard from anyone (except my colleagues, of course — nothing from politicians, naturally) is a real cut that could substantially help.

Since the government is running out of money, cut federal wages across the board.

And make the cuts “progressive.”

How? Take any current federal government salary. Exempt the first (say) $60,000. And then cut the remaining salary level above that by (say) 20 percent. The exemption makes the rate cut in effect progressive. The “rich” would face greater income reductions.

Progressives should like that, no?

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets too much government

Bankrupted by Cushy Pension Contracts

Central Falls, Rhode Island, is not a large city. It is a town of under 20,000 people. And its government is broke, facing likely bankruptcy.

Municipal bankruptcies are not common. But they might become so. Why? The blame is easy to place: the proverbial gun-under-the-table contracting foisted on small localities by state governments.

That’s what happened in Central Falls, anyway.

Even the New York Times has an idea of the underlying problem:

The city, just north of Providence, is small and poor, but over the years it has promised police officers and firefighters retirement benefits like those offered in big, rich states like California and New York. These uniformed workers can retire after just 20 years of service, receive free health care in retirement, and qualify for full disability pensions when only partly disabled.

Walter Olson, of the Cato Institute, elaborates on this account: “‘Promised’ is a word of art here, because the city wasn’t really making all of these concessions on a voluntary basis. . . .” The concessions to unions were, instead, forced on the town by “public-sector arbitration” (which has almost nothing to do with private arbitration) that has led to a widespread “crisis in municipal finance,” which, the Times states, has brought one in four Rhode Island municipalities to the brink.

Olson makes the reasonable case that public-sector employee unions are a very bad idea to begin with. The end comes either with serious reform or bankruptcy.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets insider corruption too much government

Medallions “Stink of Tyranny”

Not long ago on Townhall.com I briefly told the tale of two journalists, both arrested for taking pictures at a public meeting. This stunk of tyranny, to me. “Government cameras on citizens? Dangerous. Citizen lenses trained on government? Essential safety devices.”

What I didn’t mention was that the public meeting was for the District of Columbia’s taxi-cab commission. The commission oversees what was once a remarkably free system of taxis, but has become more regulated while also earning a reputation for corruption. Pete Tucker, one of the reporters, was on the scene to cover a breaking story related to that corruption: The commission’s proposal to regulate the industry using the over-used and idiotic “medallion” system, familiar to New Yorkers and far too many other city-dwellers.

Well, Tucker’s work has reached the completion stage, now, with Reason TV’s video about the medallion system up on YouTube. It’s an eye-opener.

The gist of the piece may be familiar: Government regulation helps bigger businesses at the expense of smaller ones . . . as well as consumers. You may have read similar tales from economists such as those in the French Liberal School (Frédéric Bastiat), the Chicago School (Milton Friedman), the Austrian School (Ludwig von Mises), and Public Choice (James Buchanan). Courtesy of the Reason video, now you can see ordinary citizens making the case. One said, “We know tyranny when we smell it.”

The stench is also of corruption, which has driven the politics behind the new regulatory scheme.

This is Common Sense. I’m Paul Jacob.

Categories
ideological culture too much government U.S. Constitution

The 14th Amendment Escape Clause?

Just as Tea Party representatives begin to bring the Constitution back into vogue, primarily to curb the power and spending of Congress, an innovative interpretation of the 14th Amendment floats around the capital, finding enthusiastic supporters amongst advocates of never-ending debt accumulation.

You see, Congress has limited the debt, by law, since 1917. And has raised that limit umpteen times (ten times this past decade). Now that Tea Party Republicans are using the debt limit to negotiate cuts in spending, the pro-spending forces are becoming frantic.

And clever.

Some of them now argue that Section Four of the 14th Amendment would allow the president to raise the debt limit without Congressional permission. After all, “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”

At first blush this makes some sense, until one realizes that the 1917 law is, in fact, “the authorization” mentioned in the very clause — at which point the argument collapses faster than the integrity of politicians in closed session.

Still, the idea of the Executive Branch interposing between Congress and the people — like “state nullification” interposed, in James Madison’s very words, between the federal government and the people — is worth thinking about. And Congress could reinstate the president’s power to “impound” funds designated by Congress that he judges not authorized by the Constitution.

But you won’t find pro-spending forces advocating that.

This is Common Sense. I’m Paul Jacob.

Categories
media and media people national politics & policies too much government

What a Deal!

David Brooks, writing in the New York Times on Independence Day, cajoles Republicans to accept the deal that allegedly now faces them: Raise a few taxes (just a few!) in exchange for the Democrats going along with “a debt reduction measure of $3 trillion or even $4 trillion.” After all, he writes,

If the Republican Party were a normal party, it would take advantage of this amazing moment. It is being offered the deal of the century: trillions of dollars in spending cuts in exchange for a few hundred million dollars of revenue increases.

And then Brooks goes off on how unreasonable the Republicans have become, how abnormal.

Well, we can only hope.

There’s good reason for recalcitrance in the Republican party. Our beloved congressfolk do not have a revenue problem, they have a spending problem. They keep increasing spending, year by year, no matter what the revenue actually is.

Increasing revenue — which is still not certain even if marginal tax rates get upped or “loopholes” get closed — does not solve the base problem, which is spendaholic politicians.

Besides, the “trillions” in cuts are in the future, while the taxes would be immediate. We’ve been burned on such deals before, like Lucy and Charlie Brown’s football.

There was a reason the New York Times chose Brooks for its “conservative.” He can always be counted to chatter “kick the ball.”

Don’t fall for it, Charlie Brown.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies too much government

Cold, Hard Reality

Yesterday President Obama declared that no one is arguing for government default. But isn’t it amazing to see so many politicians work so hard to ensure that un-argued-for goal?

There are two parts to a default. The first is running up debt; the second is not paying it back. Like it or not, advocate it or not, sovereign debt repudiation comes closer as American politicians lumber on with the first part.

Of course, there are folks who think the American people should simply repudiate their government’s debt. Over at the Mises Institute, Justin Ptak provides citations from more than one economist advocating just that.

Gary North states that the day is fast approaching when the phrase “full faith and credit of the United States government” will “provoke universal laughter. . . .” He insists that “the credit rating of the United States government will be marked down from AAA to AA. It will then be marked down to A.” What’s more, he says this is a good thing: “For every notch down that it falls, the national day of deliverance draws closer.”

Paranoid? Fringe? Hopeful? No matter how you categorize such talk, it’s not crazy to think about, since the probability of default grows as the debt increases.

A default could have a beneficial effect on America’s politicians: They would be unable to finance further deficits. Reality’s cold, hard fist — that is, un-amused investors — would rein them in.

This is Common Sense. I’m Paul Jacob.

Categories
ballot access too much government

Arizona “Clean Elections” Scheme Nixed

The United States Supreme Court decided, 5-4, against Arizona’s “clean elections” law. In two challenges to the law, Arizona Free Enterprise Club’s Freedom Club PAC v. Bennett and McComish v. Bennett, the Court ruled for freedom and against a bizarrely unfair form of “fairness.”

The idea behind Arizona’s law was to make money somehow “not count” by “leveling the playing field.” Arizona did this by giving taxpayer money to “clean elections candidates” to equal the voluntary donations obtained by privately funded competitors.

Chief Justice Roberts says the scheme goes “goes too far.” I would say: Way too far.

Roberts nicely argues that though “‘Leveling the playing field’ can sound like a good thing . . . in a democracy, campaigning for office is not a game.  It is a critically important form of speech.  The First Amendment embodies our choice as a Nation that, when it comes to such speech, the guiding principle is freedom — the ‘unfettered interchange of ideas’ — not whatever the State may view as fair.”

Now, I see why people don’t like the ugliness and “unfairness” inherent in “winner-takes-all” zero-sum contests like political campaigns. But the solution isn’t to hand public money to some favored candidates, effectively putting a finger on the scales. Instead, provide the public with greater choices, and let the people freely decide.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets too much government

Reform Challenge

Taxpayers fund about half of all medical industry transactions, and governments regulate that as well as a huge chunk of the rest. No wonder medicine is in chaos.

Economist Charles Sable asserts that he knows how to make health care better. Arnold Kling, on EconLog, reports Sable as saying that “health care providers need to be able to improve by learning from and correcting mistakes. He then proceeds to offer legislation to force that.”

But Kling offers an interesting challenge: “If you know a better way to run health care organizations, why don’t you start a health care organization?”

As opposed to dictating by law how others should manage theirs.

Kling, an economist who has run a business or two, thinks that when “a liberal/progressive proposal is supposed to do X,” the liberal “expert” should “start a private entity to do X.” He sees no reason why the medical industry would be immune to such challenge:

If health care providers are doing a bad job, what stops you from implementing a better model and taking over the market? Are consumers too stupid to know the difference between providers who make lots of unnecessary mistakes and providers who don’t? If they are so stupid as consumers, why do you expect them to be smart as voters?

In the real world, we could use people with ideas who really run with them — not stand back and tell some other folks how to run yet another bunch of folks’ lives and businesses.

This is Common Sense. I’m Paul Jacob.

Categories
too much government

ATF Misfire

A machine gun is like obscenity: We can’t define what it is, but everyone says they know it when they see it.

Well, that appears to be the case with the agency of the federal government formerly called the Bureau of Alcohol, Tobacco and Firearms, anyway. According to a statement issued yesterday by the Gun Owners of America (GOA), “The Bureau has never published a manual detailing how they determine what is, or is not, a machine gun.”

If your main reason for existence is controlling weaponry like machine guns, shouldn’t the criteria for determining what a machine gun is be publicly known?

But the reason for the bureau itself is a bit iffy. Known (un)popularly as the “ATF,” it’s been in operation (in one form or another) since 1886. Ronald Reagan infamously dubbed it a rogue agency. Since then, the ATF has slogged through multiple scandals, and a major umbrella department change, moving from Treasury to Justice. And that iffiness has been exacerbated by recent investigations by the House Oversight Committee.

Indeed, in part based on the results of those investigations, the GOA now advocates getting rid of the agency— you can read the details in yesterday’s communiqué.

The group has a point. Recent ATF activity includes another of its weird attempts at entrapment, which ended up supplying a huge amount of guns to the Mexican drug cartels.

Another federal agency doing the opposite of its mission?

Not unheard of. Call it a typical misfire.

This is Common Sense. I’m Paul Jacob.