On the Blog
Last week John Stossel hosted a segment on Earth Day featuring Heartland Senior Fellow James Taylor and Paul Gallay from the Riverkeeper environmentalist organization. Taylor (with some backup from Stossel) crossed swords with Gallay on a number of environmental subjects.
The discussion started on Gallay’s topic of interest, namely clean water, and he, Taylor and Stossel all happily agreed that our nation’s water is getting cleaner, though Gallay argued that it was not happening swiftly enough and that further government action was needed. Taylor deflated this line of reasoning by pointing out that current policies are working out quite well in an incremental fashion and that increasing government spending and power to accelerate the process would be wasteful and dangerous.
The program then turned its attention to alternative energy and the “sustainable future” of green energy lauded by Earth Day supporters and environmentalists the world over. Gallay’s position was that the only sustainable solution to our energy needs was to rely on “smart” energy, in other words green, renewable energy. Taylor rightly pointed out that the current green energy favorites, solar and wind energy, are both energy intensive and often inefficient. Solar energy in particular, he explained, was “very land and water-intensive.” The water-intensiveness is a particular problem, due to the fact that solar farms tend to be built in high-heat, water-scarce environments.
Gallay tried to answer Taylor by saying that non-renewable energy is given more subsidies than is green energy. Taylor would not be trapped, however, answering that if one considers the subsidy per-kilowatt hour of energy produced, then wind and solar receive ten times the subsidies as natural gas, and fifty times that of coal.
What the program really served to highlight was the major flaw in the mainstream environmentalist movement’s attitude, namely its fixation on what it perceives to be the problem at the expense of critically assessing the proposed solutions. Anti-carbon activists sing the praises of solar and wind energy while trying to ignore or obfuscate the issues surrounding those methods’ costs and efficiency. If supporters of green energy hope to win over a reluctant public, they need to be willing to debate the facts, not just feelings.
If an honest, informative debate is going to be had about America’s energy future, then the costs of alternatives must be honestly addressed. The fact is that lavish subsidies (often given as political favors) are the only thing that keeps most alternative energy suppliers in business. If those alternatives are to have a future in the energy sector, they need to stop suckling at the government teat and learn to compete in the real world economy. Then we might consider them a worthwhile addition to American energy production.
Americans take electricity for granted. Electricity powers our lights, our computers, our offices, and our industries. But misguided environmental policies are eroding the reliability of our power system.
This past winter, bitterly cold weather placed massive stress on the US electrical system―and the system almost broke. On January 7 in the midst of the polar vortex, PJM Interconnection, the Regional Transmission Organization serving the heart of America from New Jersey to Illinois, experienced a new all-time peak winter load of almost 142,000 megawatts.
Eight of the top ten of PJM’s all-time winter peaks occurred in January 2014. Heroic efforts by grid operators saved large parts of the nation’s heartland from blackouts during record-cold temperature days. Nicholas Akins, CEO of American Electric Power, stated in Congressional testimony, “This country did not just dodge a bullet―we dodged a cannon ball.”
Environmental policies established by Congress and the Environmental Protection Agency (EPA) are moving us toward electrical grid failure. The capacity reserve margin for hot or cold weather events is shrinking in many regions. According to Philip Moeller, Commissioner of the Federal Energy Regulatory Commission, “…the experience of this past winter indicates that the power grid is now already at the limit.”
EPA policies, such as the Mercury and Air Toxics rule and the Section 316 Cooling Water Rule, are forcing the closure of many coal-fired plants, which provided 39 percent of US electricity last year. American Electric Power, a provider of about ten percent of the electricity to eastern states, will close almost one-quarter of the firm’s coal-fired generating plants in the next fourteen months. Eighty-nine percent of the power scheduled for closure was needed to meet electricity demand in January. Not all of this capacity has replacement plans.
In addition to shrinking reserve margin, electricity prices are becoming less stable. Natural gas-fired plants are replacing many of the closing coal-fired facilities. Gas powered 27 percent of US electricity in 2013, up from 18 percent a decade earlier. When natural gas is plentiful, its price is competitive with that of coal fuel.
But natural gas is not stored on plant sites like coal. When electrical and heating demand spiked in January, gas was in short supply. Gas prices soared by a factor of twenty, from $5 per million BTU to over $100 per million BTU. Consumers were subsequently shocked by utility bills several times higher than in previous winters.
On top of existing regulations, the EPA is pushing for carbon dioxide emissions standards for power plants, as part of the “fight” against human-caused climate change. If enacted, these new regulations will force coal-fired plants to either close or add expensive carbon capture and storage technology. This EPA crusade against global warming continues even though last winter was the coldest US winter since 1911-1912.
Nuclear generating facilities are also under attack. Many of the 100 nuclear power plants that provided 20 percent of US electricity for decades can no longer be operated profitably. Exelon’s six nuclear power plants in Illinois have operated at a loss for the last six years and are now candidates for closure.
What industry pays customers to take its product? The answer is the U.S. wind industry. Wind-generated electricity is typically bid in electrical wholesale markets at negative prices. But how can wind systems operate at negative prices?
The answer is that the vast majority of U.S. wind systems receive a federal production tax credit (PTC) of up to 2.2 cents per kilowatt-hour for produced electricity. Some states add an addition credit, such as Iowa, which provides a corporate tax credit of 1.5 cents per kw-hr. So wind operators can supply electricity at a pre-tax price of a negative 3 or 4 cents per kw-hr and still make an after-tax profit from subsidies, courtesy of the taxpayer.
As wind-generated electricity has grown, the frequency of negative electricity pricing has grown. When demand is low, such as in the morning, wholesale electricity prices sometimes move negative. In the past, negative market prices have provided a signal to generating systems to reduce output.
But wind systems ignore the signal and continue to generate electricity to earn the PTC, distorting wholesale electricity markets. Negative pricing by wind operators and low natural gas prices have pushed nuclear plants into operating losses. Yet, Congress is currently considering whether to again extend the destructive PTC subsidy.
Capacity shortages are beginning to appear. A reserve margin deficit of two gigawatts is projected for the summer of 2016 for the Midcontinent Independent System Operator (MISO), serving the Northern Plains states. Reserve shortages are also projected for the Electric Reliability Council of Texas (ERCOT) by as early as this summer.
The United States has the finest electricity system in the world, with prices one-half those of Europe. But this system is under attack from foolish energy policies. Coal-fired power plants are closing, unable to meet EPA environmental guidelines. Nuclear plants are aging and beset by mounting losses, driven by negative pricing from subsidized wind systems. Without a return to sensible energy policies, everyone must prepare for higher prices and electrical grid failures.
[Originally published at Communities Digital News]
It is refreshing to read a book that reflects one’s own views and “Guardian of the Republic” by Allen West, a former Lieutenant Colonel in the U.S. Army for over twenty years and a former, one-term congressman from Florida, who is perhaps best known these days as a Fox News channel contributor, is such a book. He is a very conservative, articulate black American.
As he points out, “The Left must destroy black conservatives because it cannot afford to have freethinking, independent-minded black Americans. When the Left wins, our community loses. The result of such blind loyalty is that many black voters have come to resemble Vladimir Lenin’s ‘useful idiots.’ They make up an electorate that is completely taken for granted and no one even bothers to listen.”
It is ironic that the first black President will not only be remembered as our worst, but that his failure will reflect on the entire black community in America even while men like West and other blacks of real achievement exist.
For now, it is definitely an uphill struggle for black conservatives, particularly for those in public life. “The mainstream media,” says West, “have a clear tendency to recruit other blacks to denigrate and demean black conservatives” and have “sought to disrespect and deny the existence of black conservatives, but they’re losing the battle and they realize it. The big lie that has resulted in the twenty-first century economic plantation will be exposed and defeated, and our community will be restored.”
I don’t know when I first heard West, but I suspect it was during his run for Congress. I do recall I was instantly and enormously impressed. He won that race and served from 2011 to 2013 representing Florida’s 22nd District. His race for reelection was a classic case of electoral tampering, misconduct, and political slander by those who wanted to defeat him.
“One of my biggest frustrations and concerns about America (is that) our electorate doesn’t have a clue about who we are or whence we came.” Much of his book is devoted to a mini-history lesson regarding the founders, the Constitution, and the principles that set America on the path to greatness among nations. West holds two masters degrees; one from Kansas State University in political science and the second from the U.S. Army Command and General Staff College in military arts and sciences.
He had just over twenty years to practice military arts, but he had set his heart on joining the Army early on, joining the ROTC in college and thereafter being recognized at every stage for his intellect and his leadership skills. He was deployed to Kuwait in 1991 and Iraq in 2003.
West is plain-spoken. He defines our fundamental governing principles as “limited government, fiscal responsibility, a free market, individual sovereignty, a strong national defense, and an understanding that all of man’s freedoms come ultimately from God.”
And then he says, “Measured against our fundamental governing principles, we clearly do not have good government—heck, we suck! We have excessive debt, growing poverty, exploding deficits, an expanding nanny-state, and an anemic economy.”
“The sad thing is,” says West, “there seems to be no reprieve in sight. Why? Because, as a nation, we have become uninterested, uninformed, and disengaged from the truth.”
Throughout his book, West mixes lessons regarding the system the Founders implemented and his fears about the present generations of Americans, given the last two elections. “I fear national-level elections have become nothing more than a version of American Idol,” says West at one point. He concludes his first book saying, “We have to turn off the brain-draining reality TV shows for a few hours and read, think, assess, and challenge ourselves to be better.”
West has had a remarkable life to this point and he could choose to make a lot of money in some corporate position or as an entrepreneur, but he wants to reach out, not just to the black community, but to all Americans because he is worried about where President Obama has taken the nation he loves and wants to see it saved from unimaginable and unconscionable debt.
We need a lot more men like Allen West. The black community needs to pay him and other black conservatives more attention. The rest of us should hope that a change in future administrations will bring his talent to bear on the restoration of America.
[Originally published at Warning Signs]
On April 15, nearly 90 percent of American adults filed their income tax returns for the 2013 tax year. And at the end of that day, I finished drinking a glass of truly tremendous bourbon; 130 proof seems appropriate to numb the pain.
A big check to the state, and a much bigger one to the federal Treasury, reminds us of how little we get for the taxes we pay and how much the tax system is distorted to favor special interests and buy votes. (If you have to write a particularly egregious check to your state, you might want to consider this new and helpful Laffer Center calculator called “Save Taxes by Moving.” Those living in Tennessee get the best of both worlds: No earned-income tax but some very fine local whiskeys.)
With more than half of President Obama’s 442 proposed tax increases as well as some of the heftiest Obamacare taxes (since Chief Justice Roberts told us that that’s what they are) coming (or hoped by the administration to be imposed) in the next two years, we will soon look back on this tax season the way you fondly recall getting a filling when the dentist tells you that today you need a root canal.
But even now, the American people despite being woefully misinformed about our tax system — exactly as the left wants them — are adding the federal income tax to their many dissatisfactions with Obama administration.
According to a Gallup poll released on April 14, 10 percent more Americans now think their taxes are too high than think their taxes are about right. That level has only been matched once, and only briefly, since the Bush tax cuts of 2003 that Democrats hate with such a passion.
Not surprisingly, a majority of Democrats think their taxes are “about right,” whereas only 38 percent of Republicans share that view. Independents seem to be even more concerned about excessive tax rates (for their own taxes) than Republicans are — which should scare the bejesus out of Democrats going into the 2014 elections, as if they don’t have enough to worry about.
But beyond the expected partisan differences in satisfaction with taxes, this week’s polling also shows a remarkable cluelessness among the American population when it comes to “who pays what” in federal income tax. It proves, sadly, that class warfare rhetoric, as spouted by President Obama and the great unwashed of Occupy Wall Street and many others, is having an impact (because the well-off are apparently too ashamed of success to mount a credible defense of economic liberty).
Forty-nine percent of Americans, according to another Gallup poll, believe that the middle class pays too much in taxes. It is by far the highest number on this question since Gallup started asking it 15 years ago. A stunning 41 percent believe that lower-income Americans pay too much in taxes, this despite the fact that most of them are net receivers of tax dollars.
Yet 61 percent of Americans continue to believe that their upper-income friends pay too little.
A Rasmussen Reports survey released last year, offers an explanation: “68% believe middle-class Americans pay a larger share of their income in taxes than wealthy Americans do” and “only 24% think the wealthy pay their fair share.”
But it’s all BS.
Ronald Reagan, paraphrasing Civil War-era humorist Josh Billings, put it this way: “The trouble with our liberal friends is not that they are ignorant, but that they know so much that isn’t so.”
Like a noxious weed, Warren Buffett’s hypocritical ramblings about his secretary have taken root in the American psyche. Unfortunately, Republicans who should be the “Roundup” of economic debates, often act instead like weed fertilizer — allowing the unchecked spread of misinformation and bad policy by being too stupid or too timid to tell the public the truth they desperately need to know. Perhaps manure is a better metaphor since the GOP does such a crappy job where it’s needed most. (Did I mention how good this bourbon is?)
A few facts to consider, based on 2010 Congressional Budget Office data:
The bottom 40 percent of earners in this country, with average pre-tax earnings up to nearly $50,000, have a negative tax rate. The bottom 20 percent have a negative tax rate averaging more than 9 percent. In other words, if you earn $24,000, not only do you not pay income tax, you receive over $2,000 in income tax transfers (in addition to other forms of welfare) from those who do pay tax.
The average federal tax rate — individual income taxes, excluding payroll taxes — for those in the fourth quintile, meaning those between 60 percent and 80 percent of earners ranked by income (average pre-tax earnings of about $95,000) is about 5 percent. That is not a typo.
For those in the highest quintile (average earnings $239,000), the average tax rate is just under 14 percent, but even that understates how steeply “progressive” our tax code is: Breaking down the top quintile further, the average tax rate for those in approximately the 85thpercentile (income about $135,000) is 8 percent. Those earning about $275,000 pay 15 percent of their income to the Treasury. And the evil “top 1 percent” (average pre-tax income of $1.4 million) pay over 20 percent of their income in taxes.
On the other hand, the middle 20 percent of American earners, average income just over $65,000, had an average tax rate of — wait for it — 1.6 percent.[If you wonder about why average tax rates are so low, a few considerations: First, the lowest levels of income aren't taxed. Second, there are large deductions and exemptions available. As a simplified example, imagine a scenario where there is zero tax until $15,000 of income with a tax rate of 10% above that threshold and a $7,500 personal exemption. Someone who earns $30,000 will have $22,500 of adjusted gross income, but no tax on the first $15,000, leaving a 10% tax on $7,500 for a tax due of $750, representing an average tax rate of 2.5% (one quarter of the marginal rate) on the total income. Additionally, upper-income earners can have a substantial percentage of their income derive from tax-free municipal bonds and from long-term capital gains which partially explains why their average rate is substantially lower than their marginal rate of approximately 40%. Their high marginal rate also encourages deductible charitable contributions.]
The idea that the rich pay less than the middle class is one of the most dangerous myths propagated by knowing leftists and their useful idiots throughout society, including among people like Warren Buffett who should know better and those like most Democrats in Congress and every talking head on MSNBC who have no clue nor an interest in getting one.
So what does all this mean in real money?
That the top 20 percent of earners paid (in 2010) 93 percent of all individual income taxes. Again, even that understates the penalty for success in the United States (which is not to say that it is a lot better in other places): The top 1 percent paid 39 percent of all taxes; the top 5 percent paid over 63 percent, and the top 10 percent paid 78 percent. Meanwhile, the bottom 40 percent collected 9 percent of income taxes paid by the more financially successful among us.
While the distribution of tax payments was slightly less “progressive” in 2011, America remains a society suffering — even if most people don’t know it — under steeply progressive taxes which former President of Estonia Mart Laar described (in a must-watch speech from 2006) as “the grand idea of Karl Marx.”
Liberals will argue, fact-free as always, that “the rich” who are funding approximately everything in this country should be doing so because they pay too little compared to their earnings. In fact, the top 1 percent pay nearly twice as big a share of all individual income taxes as their share of national income.
Others who still make very good incomes in this country, such as those earning $100,000, pay a lower proportion of the nation’s taxes than they earn of the nation’s wealth. The bottom 50 percent of earnings bring in (in 2011) 11.5% of the national income but pay less than three percent of the taxes, and — bear with me here — all of that 2.9 percent is among those at the top of the bottom 50 percent (because the bottom 40 percent have a negative tax rate.)
OK, enough numbers, especially because I’m well through my glass of bourbon.
When it comes to the changing views of Americans regarding income taxes, facts are useful intellectual ammunition but politicians must deal with the reality of an uninformed populace.
And that reality is a double-edged sword (which mostly cuts the wrong way): On one hand, the public has bought substantially into the view that the rich don’t pay enough, and that’s a recipe for extremely damaging public policy — attempting to “soak the rich” even more than our system already does and thereby damaging the incentive to be entrepreneurial, take risk, and create jobs and wealth for others.
Since the richest among us can often structure investments and income to delay paying the tax man, and since many of them can simply quit working (somewhere Ayn Rand is shouting “preach it, brother!”), raising income tax rates is unlikely to bring in more tax revenue. This is the message of the Laffer Curve and the lesser-known but even more on-point Hauser’s Law. (It’s also the reason the left so desperately wants to add a national sales tax.)
On the other hand, despite Barack Obama’s protestations that he hasn’t raised taxes, the public knows he is (how to put this politely?) a liar. When it comes to describing his tax hikes as anything but what they are, President Obama channels Humpty Dumpty: “When I use a word, it means just what I choose it to mean — neither more nor less.”
Still, the middle class is starting to feel resentful of their increasing tax burden. The problem is that those who are truly the median income earners in America pay almost nothing in tax so their focus will remain on going after the top quintile of earners — which is precisely the goal of Democrats in spreading their Through-The-Looking-Glass fabrications about tax fairness in America.
As our own Ben Stein’s brilliant father, Herb, noted, “If something cannot go on forever, it will stop.” Few things describe our nation’s fiscal path, including our tax policies, as accurately and as frighteningly.
Unless and until that message sinks in, as reality must eventually require but probably not before there is great national pain (and even then it does not necessarily lead to wiser political choices by voters), those who understand what is really happening in America can find a modicum of solace in knowing we’re right — though I also suggest a really fine glass of bourbon.
[First published at The American Spectator.]
In the latest Bureau of Labor Statistics jobs report, for March, the Obama economy finally reached a long overdue milestone. More than six years after the latest recession began, in December, 2007, the economy has finally at long last recovered all of the jobs lost during the recession.
The gross failure is that in the 11 previous recessions since the Great Depression, the economy recovered all jobs lost during the recession after an average of 25 months after the prior jobs peak (when the recession began). So the job effects of prior post Depression recessions have lasted an average of about 2 years. But President Obama’s supposed recovery has taken three times longer than prior post-Depression recoveries on average to achieve that same result.
That is just further confirmation that President Obama has misled America into the worst recovery from a recession since the Great Depression. And, no, Obamabots cannot say the recovery was so bad because the recession was so bad. America’s historical record is the worse the recession, the stronger the recovery, as the economy races ahead during the recovery faster than normal, to catch up to America’s world leading, long term, economic growth trendline.
These extremely poor results are the direct consequence of Obama’s meticulously anti-growth economic policies. Instead of cutting tax rates, as both Kennedy and Reagan did to such astounding, historic success, Obama has raised the rates of every major federal tax, except for corporate income taxes, where the top marginal tax rate is now the highest in the world for any significant economy. Obama only postures as favoring corporate tax reform to lower those rates, which would be enacted with broad, bipartisan support in his absence.
Instead of deregulation to reduce unnecessary, stifling regulatory burdens and barriers, as both Carter and Reagan did to such fully documented success, Obama regulates mercilessly as if regulation is cost free to the economy, as the most interventionist President in American history.
Most destructively, Obama has stifled the still world leading American energy boom, still straining to completely break out, by shutting down exploration and development of oil and gas on federally controlled lands and seas, and constantly threatening the regulatory shutdown of exploding private energy development. Implementation of that has already begun in regard the coal industry, all of which evidences a President who seems to be at war with his own economy.
This punitive energy overregulation only barely beats out the massively destructive overregulation of Obamacare, which has long been causing havoc and chaos in America’s labor markets, and only threatens to get far worse, as Obama implicitly recognizes with his illegal delays in key components of his own legacy legislation. Exactly contrary to the dense fog of fascist style propaganda of the current times, unprecedented in American history, Obamacare health care overregulation has only sharply increased rather than reduced health costs, further stifling the economy.
The Fed’s wild-eyed monetary policies, which Obama has enthusiastically supported like a football coach orchestrates his team’s offensive and defensive game plans, only further discourage the capital investment that is the lifeblood of capitalism by destabilizing the currency, and planting the seeds for the return of double digit inflation. In a later column, I will explain why the Fed cannot engineer a soft landing from the years long flight of monetary policy fantasy with virtually zero interest rates and money printing to cover the Obama/Democrat record shattering deficits that exploded from the Democrat takeover of Congress in 2007.
Moreover, the revival of runaway federal spending, deficits and debt that exploded with the new Democrat Congress in 2007, further accelerated by Obama’s $1 trillion, so-called stimulus spending bill in 2009, is not pro-growth, as Keynesian witch doctors tell us, but anti-growth, as the real world record, and fundamental logic, tell us. Explaining the double counting illogic of Keynesian policies would just be excessively repetitive of prior columns. The only real question is whether there will be any accountability, and consequences, for blind advocates of these costly, fallacious policies, which have failed regularly for going on nearly 100 years now.
But while Obama’s recovery has at long last reached the jobs milestone of at least getting us back to where we were 6 years ago, America’s jobs market and economy are still deeply troubled. Unemployment at 6.7% nearly 5 years after the recovery began is way too high. Unemployment fell to 4.4% under President Bush in 2006 and 2007. The Bureau of Labor Statistics reports the U6 unemployment rate, which includes those marginally attached to the work force who still cannot find work, and those working part-time because they can’t find full time work, was still well into double digits in March, 2014 at 12.7%. Black unemployment was also still well into double digits, at 12.4%, where it has been during Obama’s entire time in office.
Moreover, the employment rate, which means the proportion of adult Americans who have a job, has fallen from 62.2% in 2007 to 58.9% today. That decline means 10 million Americans currently not working.
The labor force participation rate, which measures the portion of those of working age who are working or actively seeking work, stands today at 63.2%, the lowest level since August, 1978. That rate fell only a quarter of a point during the recession, but it has fallen an additional three percentage points since President Obama’s recovery began in the summer of 2009. Just as the unemployment rate falls during a recovery, the employment rate, and labor force participation, is supposed to rise. The Wall Street Journal in an editorial on April 4 asked why the latter has not happened during this supposed recovery.
Obama apologists are quick to point to the start of the retirement of the baby boom generation. But those born during 1946 and 1947, when the baby boom began, did not reach the full Social Security retirement age, currently 66, until 2012 and 2013. Yet, the recovery is officially dated as starting in the summer of 2009, according to the National Bureau of Economic Research. The Journal noted that it is still problematic if the weak economy is causing older workers to retire early.
Moreover, the declining employment rate and labor force participation have not been limited to older workers, but have declined sharply for those in the prime working ages of 25 to 54 as well. A 2012 study by the Federal Reserve Bank of Chicago estimated that only about one-fourth of the decline in labor force participation since the recession was due to retirements.
Part of the reason for the declining measures of work is simply that the recovery has been so weak. Real economic growth in 2013, the fourth year of the recovery, was still less than 2%, and during Obama’s first term it was the slowest of any Presidential term since the Great Depression.
But there is another predominant factor, going back to before Obama became President, though Obama has greatly added to the problem. Taxpayers are paying mostly the bottom 20% of the income ladder a trillion dollars a year basically not to work, through close to 200 federal means tested welfare programs. Those include Medicaid, Food Stamps, 27 low income housing programs, 30 employment and training programs, 34 social services programs, another dozen food and nutrition programs, another 22 low income health programs, and 24 low income child care programs, among others. The famous Seattle/Denver Income Maintenance Experiments (“SIME/DIME”) conducted from 1971 to 1978 confirmed the impact of such substantial, unconditional, welfare subsidies on the incentive not to work.
Even worse, when those in poverty try to go to work, they are effectively subject to extra, higher, marginal tax rates. Since welfare is phased out as income rises, the loss of welfare benefits is economically the same as a tax on the rising earnings. Art Laffer and Steve Moore call this “The Poverty Trap,” explaining:
Needs tests, means tests, and income tests exclude people [from welfare] as their incomes progressively increase, ensuring that funds are not squandered on those who are less in need. While ‘needs’ tests may be rationalized on both moral and budgetary grounds, when combined with payroll and income taxes, the phased reduction of welfare benefits has meant that spendable income actually rises very little as gross wages increase, and for some income thresholds, spendable income (total spending power) actually declines as wages increase.
Laffer examined the total effect of all the needs tests and taxes affecting an inner city family of four on welfare in Los Angeles. He found:
What was clear from this analysis is that marginal tax rates for inner city inhabitants were prohibitively high—in some cases, the poorest people actually faced the highest marginal tax rates of all income groups. Over the entire range from no wages to wages of $1,300 per month, the family in my analysis faced marginal tax rates that ranged from a low of 53 percent (a poor family gained only $47 in spendable income when its gross monthly wages increased from $0 to $100) to a high of 314 percent (a poor family lost $214 in spendable income when its gross monthly wages increased from $1,000 to $1,100 a month.)
A 1996 Urban Institute study by Linda Ginnarelli and Eugene Steuerle on the same issue similarly found that the poor faced effective marginal tax rates of 70% to 101%.
President Obama has only made this problem far worse. He has aggressively sought to sign up more and more Americans for these programs, running up the number dependent on them to close to 100 million. He has increased the number on food stamps by nearly 50%, close to 50 million, an all-time record, prompting Newt Gingrich to call him the “food stamp President.” CBO estimates that Obamacare will ultimately increase the number of Americans dependent on Medicaid to 100 million in less than 10 years.
Obamacare also includes new entitlement welfare to help with the high cost of government mandated health insurance for families earning soon as much as $100,000 a year. That subjects all of these families to poverty trap effective taxes as well, because the health insurance welfare is reduced as income rises. This is why CBO recently estimated that Obamacare would reduce the labor force.
The Journal editorial admonished that, “The Republican Party needs policies that address this erosion of work that go beyond the Federal Reserve’s easy money.” Republicans in fact have a readily available, comprehensive, reform alternative that can abolish the poverty trap entirely, building on bipartisan reforms of the past that they already led the way to enacting.
Former House Speaker Newt Gingrich led Congress to enact reforms of the old, New Deal, Aid to Families with Dependent Children (AFDC) program in 1996, which ultimately received more than 100 Democrat votes, and signature into law by Democrat President Bill Clinton. Under those reforms, the old AFDC rolls were reduced by two-thirds nationwide, even more in states that pushed work most aggressively, because the poor formerly on the program went to work, or married someone working. Because of all this renewed work effort, the total income of these low income families formerly on welfare increased by about 25% over this period, as Ron Haskins of the Brookings Institution reports in his 2006 book evaluating the 1996 welfare reforms, Work Over Welfare.
The resulting decline in poverty “was widespread across demographic groups…caused by increased employment and earnings of female headed families.” Poverty among these female headed households declined by one-third, which meant that nearly 4.2 million single mothers and children climbed out of poverty. Haskins cites a study by the liberal Isabel Sawhill of the Urban Institute and Paul Jargowsky concluding,“So great was the decline in poverty that the number of neighborhoods with concentrated poverty fell precipitously, as did the number of neighborhoods classified as underclass because of the concentration of poverty and the high frequency of problems such as school dropout, female headed families, welfare dependency, and labor force dropout by adult males.”
Yet, in real dollars total federal and state spending on TANF by 2006 was down 31% from AFDC spending in 1995, and down by more than half of what it would have been under prior trends. Consequently, poverty declined sharply, while taxpayers saved on 50% of the cost of the program.
These same block grant reforms can and should be extended to all of the remaining nearly 200 federal means tested welfare programs. The states could experiment with all this new power and control over funding by replacing the entire current, outdated, counterproductive, welfare system with a work safety net for the able bodied, where public assistance is provided only in return for work first. Those who report to their local welfare office before 9 am would be guaranteed a work assignment somewhere paying the minimum wage in cash for a day’s work, 8 hours. A private job assignment would be the top priority. But if that is not available for that day, the applicant would be assigned to some government directed and financed activity, serving the community in some way, city, county or state. The worker would be paid in cash at the end of the day. Those who needed more money would come back to work the next day.
The government would provide free day care for those with small children who desired it, which it has done under TANF since 1996. For those who come back regularly, the welfare office would find them a private job assignment. Indeed, states could contract out their welfare offices to private temp companies, in business to provide immediate job assignments to those who show up needing immediate work.
As a result, instead of taxpayers paying a trillion dollars a year to the bottom 20% not to work, as under the current welfare system, private employers would be paying them much more to work, and contribute to economic growth and prosperity for all. This new system would effectively eliminate the poverty trap and incentives for not working. Assistance would be provided only for working (for the able-bodied), so working and earning more would not reduce benefits. Rather, the incentive is to take whatever private sector job is available, since the able bodied will have to work to support themselves anyway, and in the private sector the worker will gain skills, raises, promotions, and new opportunities over time.
For those who do show up for work assignments, their need is likely to be short term, as the incentive is for them to take available private sector jobs that do open up. People are not going to show up for these day jobs for years, as many have done for free welfare. Moreover, for those who continue to show up, their public support will be minimized in any event, as the state agency and associates find them private job assignments that will provide the bulk of their support in place of the taxpayers. That private employment will grow into or lead to permanent employment growing the worker mostly and likely completely out of public assistance with wage gains due to experience, learned skills, promotions, and the new opportunities that work will lead to over time.
Arguably, by abolishing the Poverty Trap, such a new system would ultimately eliminate poverty in America. As I showed in a previous column, already under current law, the minimum wage, plus the Earned Income Tax Credit, plus the Child Tax Credit adds up to more than the poverty line for every possible family combination. The disabled who could not work would be provided assistance under separate programs designed for them, which would not cost much.
[First published at Forbes.]
This is the start of a story I just spotted on the Chicago Tribune website. Remember, this is not from The Onion or other spoof news site. This is real.
“More than 2,800 Internal Revenue Service workers who had been disciplined recently received millions of dollars in bonuses and time off as part of an employee recognition program, a new government audit shows.
“The IRS has a program that rewards its employees for a job well done, but a report released Tuesday by the Treasury Inspector General for Tax Administration found that, between October 1, 2010, and December 31, 2012, more than 2,800 recently disciplined IRS workers got more than $2.8 million in monetary awards and more than 27,000 hours in time-off awards.
“The employee infractions included not paying their taxes.
“’While not prohibited, providing awards to employees who have been disciplined for failing to pay federal taxes appears to create a conflict with the IRS’ charge of ensuring the integrity of the system of tax administration,’ J. Russell George, Treasury Inspector General for Tax Administration, said in a statement.”
This is our government — a government that punishes us if we’re even one day late paying our taxes while giving cash bonuses and other perks to Internal Revenue Service employees who fail to pay their taxes. Is this a great country or what!
I remember the first Earth Day in 1970. I was a freshman in high school and we had an Earth Day Assembly. There was a play with Steppenwolf’s “The Monster” blaring. They changed the words, “America where are you now, don’t you care about your sons and daughters?” to “America where are you now, don’t you care about your parks and waters?” The young ladies from the drama club and the cheerleaders were dressed up as trees running around on stage. When I saw that, I wanted to become a tree-hugger, but alas, none of the trees were interested in hugging a 5 foot 2 inch, 160 lb. freshman nerd.
Years later this has grown into a borderline religious holiday for some. I thought Earth Day Eve caroling would be a good idea until I was pelted with recycled cans and organic waste. And getting dressed up as a tree was not a good idea since every dog in the neighborhood was howling at my lousy singing and trying to use me as a place to relieve themselves.
Thank you, thank you very much. I’m here ’till the editors get tired of me. Try the Tofu Veal.
Given the myth and reality of what is going on with our planet and the evolution of this movement into some kind of socio-political-economic-religious-intolerant machine, I thought I would infuse some humor into the situation while reminding people that the planet is not in danger of becoming a wasteland by what we hear from these people. Other things, perhaps, but not global warming.
There are far more pressing problems facing mankind today, chief among them the long standing one of man’s inhumanity to man, which seems to be the root cause of many ills. But when I look at some of the things that are being spouted as evidence of environmental disaster, it’s easy to see how this issue is far from the end of existence it’s portrayed as. The most visible high priest of Gaia is perhaps Nobel prize winner Al Gore. Yet the doom and gloom since his Academy Award-winning movie “An Inconvenient Truth” came out has burned up like paper in fire.
The movie was a major accomplishment, though whether you wish to admit it or not, it did for the global warming movement what “Triumph of the Will” did for Germany in the eyes of many in the 1930s. How ironic that we find people on my side of the AGW issue being demonized with terms that bring up memories of arguably the greatest case of man’s inhumanity to man by the very people that put out this movie recently. Yet the inconvenient truth in both cases is the missive was proved false.
But let’s try to keep a joyful warrior spirit. The use of facts is convenient for that.
I will use some of the more choice worries from “An Inconvenient Truth.”
The melting of the ice caps? Global sea ice is above normal.
The Southern Hemisphere is breaking daily records and threatening to reach all-time high anomaly records!
Earth does this back and forth act in all things. When some places are warm, others are cold. Because the oceans have been in their warm cycle and this affects most the northern ice cap, it has been well below normal. It does so by warming the land masses of the Northern Hemisphere which have greater temperature ranges, and by doing so, influences the Arctic, a land locked ocean. But notice how its heyday was at the time the Southern Hemisphere was below normal at the start of the satellite era. The testable theory is that once the Atlantic shifts to its cold cycle in the coming 5-10 years, the Arctic ice cap recovers. It’s then that AGW proponents will try to shift attention to the shrinking southern ice cap (at least it better be shrinking). That is the whole natural cyclical theory for ice caps – when one expands, the other shrinks. So it’s a test. And yes, the Arctic ice cap has decreased overall since 1978, but you don’t need to be a math major to understand that if global sea ice is above normal, it means that there is a greater compensating increase, counter to the missive we have heard for all these years.
Then there is the issue of hurricanes. Again, aren’t we looking at this globally? Since the movie and the dire pronouncements, global tropical activity has sunk to record lows! The chart below by Dr. Ryan Maue through the 2013 season shows the fall of the ACE index – the overall activity in the tropics – since the release of “An Inconvenient Truth.”
This should return toward normal and even go back above in the coming years. Why? The simple answer is because nature swings back and forth in cycles. You see in spite of trying to make this more complex (certainly the details are more complex) the main missive remains the same: The earth by its design has no “perfect” climate but is in constant search for a balance it can never attain – in spite of the people wishing to tell you regulating this or that will.
Then there are tornadoes. For the third year in a row, after the one major year of 2011, we see abnormally low tornado production. It should pick up next week, but as of this writing we are at record lows for the date.
Then there is the 10-year running global temperature since the Pacific started its change to a colder mode. The NCEP CFSR is regarded as perhaps the gold standard measurement of global temperatures. This is against a 30-year mean, or just a bit after the satellite era started, which means there is little anyone can do to adjust temperatures down in the pre-satellite era to make today look warmer. It’s an apples to apples comparison; before 1978 we did not have the kind of reliable satellite data we do now. So since the year of “An Inconvenient Truth,” the inconvenient truth is temperatures have started a jagged descent.
For the record, the National Centers for Environmental Prediction (NCEP), where this data is derived, is not a right wing think tank.
Regarding all those computer models that had so many in a tizzy about the impending doom of the planet, this chart from Dr. Roy Spencer shows plainly that basing policy on computer modeling is a fool’s errand. People that forecast every day understand that no event is true until it actually happens.
We can go on and on here. The fact is this: Given the actual geological record of earth’s temperatures vs CO2, it’s cherry picking to use the intervals of warming in the past century to claim it’s man causing it.
CO2 is in purple, temperature blue.
As far as the Hockey Stick, here is a list of all the scholarly articles that show the earth has been warmer before. By my count there are around 100. How is it we are to trust one without even being able to see the data behind it?
As I sit here writing this reflection of Earth Day, I will end with this. I believe the intent of the original Earth Day was good even if the cheerleaders dressed as trees would not allow me to become a tree hugger back in 1970 (they probably couldn’t get their arms around me anyway). I think that being good stewards of this garden called earth (I don’t believe it’s Gaia, but something that is given to us by God, and as such we should take care of it) is spot on. But to deal with reality, one must face reality, and there is demonstrable evidence that runs counter to the missive this has grown to now. And to show you what a good sport I am, I like the movie “An Inconvenient Truth.” But I like a lot of movies where fantasy is involved.
It’s up there with the Wizard of Oz, a movie in the day where tornadoes were not caused by man as they try to make you believe now. But given my love of the weather, saying I like “An Inconvenient Truth” the way I like the Wizard of Oz (I like Star Wars too!) is high praise indeed.
Hope you had a holly, jolly Earth Day.
[First posted at The Patriot Post.]
Built on a foundation of sand, the Leaning Tower of Pisa would have toppled over long ago, if not for ingenious engineering projects that keep it from tilting any further. The same thing is true of ethanol, automobile mileage, power plant pollution and many other environmental policies.
Not only are they built on flimsy foundations of peak oil, sustainability, and dangerous manmade climate change. They are perpetuated by garbage in-garbage out computer models and a system that rewards activists, politicians, bureaucrats, and corporations that support the hypotheses and policies.
At the heart of this system is the increasingly secretive and deceptive U.S. Environmental Protection Administration. Among its perpetrators are two ideologically driven regulators who are responsible for many of today’s excessive environmental regulations. When the corruption is combined with the EPA’s history of regulatory overkill and empire building, it paints a portrait of an agency that’s out of control.
EPA’s culture of misconduct has already raised congressional hackles over the misuse of government credit cards (a recent EPA audit found that 93% of purchases were personal and contrary to agency guidelines); former regional EPA administrator (and now Sierra Club official) Al Amendariz wanting to “crucify” oil companies to make examples of them; and former EPA administrator Lisa Jackson, who masqueraded as “Richard Windsor” to avoid revelation and oversight of her emails with activists.
However, these sorry tales pale in comparison to damaging EPA malfeasance detailed in a new U.S. Senate Environment and Public Works Committee minority staff report about convicted felon and con artist John Beale. This guy was convicted of bilking taxpayers out of $900,000 – by convincing EPA bosses and colleagues that he was a CIA agent, failing to show up for work for months, but continuing to receive his six-figure salary. However, these were minor transgressions compared to what he was not prosecuted for.
Beale has admitted he had no legislative or environmental policy experience prior to being hired. Yet he became the lead official for the nation’s National Ambient Air Quality Standards for Ozone and Particulate Matter. He and Robert Brenner, his friend and immediate supervisor at EPA, concocted a nefarious plan that used manipulated scientific studies, faulty or even bogus regulatory cost assessments, “heavy-handed management of interagency review processes,” and evenillegal experiments on human test subjects to impose increasingly tougher, job-killing regulations on U.S. industries.
One of Beale & Brenner’s first actions was to work with the American Lung Association in 1997 in a sue-and-settle arrangement, which led to ozone and particulate matter standards. This underhanded practice enables EPA officials to meet with environmentalist groups behind closed doors and agree to new proposed regulations. Later, the group files a “friendly suit,” and a court orders the agency to adopt the pre-arranged rules. Meanwhile, EPA awarded the ALA $20 million between 2001 and 2010. (Had a business had such an arrangement, it would likely have been prosecuted as an illegal kickback.)
The EPW Committee’s report notes that Beale & Brenner fine-tuned the sue-and-settle idea – and then intentionally overstated the benefits and understated the costs of new regulations. As a result, Beale & Brenner successfully rammed the PM2.5 and ozone standards through the EPA’s approval process and set the stage for myriad additional regulations that likewise did not receive appropriate scientific scrutiny.
In the case of PM2.5 soot particles, the ALA worked with Beale & Brenner to claim tougher regulations would eliminate up to 35,700 premature deaths and 1.4 million cases of aggravated asthma annually. Scientists questioned the figures and said EPA’s flawed research merely “assumed” a cause-and-effect relationship between soot and health effects, but failed to prove one. Indeed, EPA’s illegal experiments exposed people to “lethal” doses of soot, but harmed only an elderly woman with heart problems.
Beale & Brenner pressed on. Not only were the initial PM2.5 and ozone regulations put into effect, but the questionable and non-peer-reviewed data has been used repeatedly as the basis for additional regulations. According to the Senate report, “up to 80 percent of the benefits associated with all federal regulations are attributed to supposed PM 2.5 reductions… [and] the EPA has continued to rely upon the secret science … to justify the vast majority of all Clean Air Act regulations issued to this day.”
As a House subcommittee has pointed out, the long and growing list of EPA regulations involves costly changes to automobiles, trucks, ships, utilities, cement plants, refineries, and gasoline, to name a few. The rules also raise consumer prices, eliminate jobs, and thus actually reduce human living standards, health, and welfare – all of which EPA steadfastly ignores, in violation of federal laws and regulations.
Just one EPA industrial boiler emissions regulation will put as many as 16,000 jobs at risk for every $1 billion spent in upgrade or compliance costs, IHS Global Insight calculates. The Administration’s regulatory War on Coal, amply illustrated by President Obama’s call to bankrupt the coal industry in the name of alleged manmade climate change, could eliminate up to 16,600 direct and indirect jobs by 2015.
Despite the economic damage, EPA applauded Beale’s regulatory success, and he quickly became one of the federal government’s most powerful and highest paid employees. Even Administrator Gina McCarthy had a hand in advancing his fraudulent and pernicious career, when she appointed him to manage the office of Air and Radiation’s climate change and other international work in 2010.
Then in June 2011, Beale stopped going to work. Despite having filed no retirement papers, under an arrangement with McCarthy, he was allowed to continue receiving his salary. When she finally met with him 15 months later, he said he had no plans to retire. Two months later, Beale’s long-term unexcused absence was finally referred to the Office of Inspector General for investigation.
After McCarthy became the EPA Administrator in July 2013, Beale pleaded guilty to fraud and was sentenced to 32 months in federal prison. His partner-in-crime Brenner had retired in 2011 — before the agency could take action against him for accepting an illegal gift from a golfing buddy serving on the Clean Air Act Advisory Committee. But again, these crimes pale in comparison to the tens of billions of dollars that their junk science, sue-and-settle lawsuits and other actions have cost US businesses and families.
Now Republican members of the Senate Environment and Public Works Committee are trying to get to the bottom of the Brenner-Beale-EPA “secret science” that has been used to justify so many regulations. On March 17, Sen. David Vitter (R- LA) sent a letter to Dr. Francesca Grifo, EPA’s Scientific Integrity Official, asking for the original scientific data and voicing concerns about EPA’s apparent violations of international guidelines for ensuring best practices and preventing scientific misconduct. EPA thus far is claiming the research and data are proprietary or the agency cannot find them. Teachers demand that students show their work; we should demand the same from EPA – especially since we pay for it.
The agency’s onslaught of carbon dioxide and other climate change regulations – including proposed rules on cow flatulence (!) – is similarly founded on fraudulent EPA and IPCC reports, false and irrelevant claims of scientific “consensus,” and computer models that bear no relationship to temperature, hurricane, drought and other planetary realities. Even worse, it is on this flimsy, fraudulent, lawless foundation that our government’s costly, intrusive environmental and renewable energy policies are based – threatening our economy, employment, living standards and families.
Meanwhile, Ms. McCarthy is conducting business as usual. She recently presented her proposed EPA’s FY 2015 budget to Congress. She says the increased funding should be viewed as an “investment in maintaining a high performing environmental protection organization.” You cannot make this up.
Governors, attorneys general, state legislatures, and private citizen groups need to initiate legal actions and demand full discovery of all relevant EPA documents. Congress too needs to take action. Along with one on the IRS targeting scandal, it needs to appoint a select committee or independent counsel to determine which data, computer models and studies EPA used – and which ones it ignored – in reaching its decisions.
Otherwise our nation’s downward economic slide, and distrust of government, will accelerate.
[Originally published at CFACT]
We have looming before us a wireless spectrum crunch. Spectrum being the finite airwaves we use for all things wireless – from cell phones to car key fobs.
More people are using more wireless data all the time. Video is an especially hay-yuge bandwidth devourer – and we’re watching ever more wireless video. So things spectrum are getting uber-tight.
In an alleged attempt to address this problem, the Feds created the bass-ackwards Spectrum Incentive Auction Legislation. The purported objective of which is to get swaths of over-the-air broadcasters’ spectrum to cell phone companies.
But the Feds absurdly mandated that they be the middlemen. Broadcasters can’t auction spectrum directly to the cellular companies – they must instead sell to the Feds, who then auction it off to the cell cos.
A straight line between sellers and buyers would make too much free market sense – and prevent the Feds from messing with the process.
Getting Broadcasters to voluntarily give up their businesses’ lifeblood is tenable at best – under optimum conditions. If the Feds decide to mess with the process – by, say, limiting auction bidders – the process will rapidly implode.
We the People need maximum bidder participation – because we need the cellular networks to keep up with our ever-increasing use. Broadcasters need maximum bidder participation – because they understandably want to get maximum spectrum coin.
(National Association of Broadcasters’ Executive Vice President for Strategic Planning Rick) Kaplan explained that TV broadcasters are worried that the (Federal Communications Commission) FCC will change or modify its auction rules during the 600 MHz auction or after it is completed.
He said such changes could imperil the revenues broadcasters are hoping to gain from the spectrum the FCC is asking them to give up in the auction….
(M)any worry that broadcasters might not give up their spectrum based on…uncertainty over how much money they will ultimately receive….
It ain’t just the Broadcasters – and we consistently free market-types – who are worried.
Almost 80 (Democrat) lawmakers signed onto a letter sent to (FCC) Chairman Tom Wheeler on Friday…directing regulators to do what they can to boost broadcaster participation and incentivize wireless industry bidding.
“In fact, inviting as many bidders as possible to compete in an open and fair auction on equal terms will allow for the full market price for spectrum to be realized and, in turn, lead to higher compensation to incent greater broadcaster participation resulting in more spectrum for the auction,” the letter reads.
The only people that want auction-and-market-damaging government-imposed bid limits? The Media Marxist Left.
While no qualified entity should be barred from participating in the upcoming auction, clear, transparent, and fair limitations on how much low-frequency spectrum any one carrier can acquire do not bar participation.
So is the FCC listening to the full cadre of:
1. Broadcasters they manifestly need to participate,
2. We free marketeers and
3. Even oodles of Democrats?
The (FCC) is expected to impose limits on an upcoming airwave auction….
The Media Marxists promised us that limiting bids wouldn’t limit bidders. As usual, they are oh-so-wrong.
AT&T…warned that if the FCC adopts rules that restrict how many licenses AT&T can bid on, it will not participate at all.
Bad for the auction – means bad for the spectrum crunch.
Not only would it likely negatively affect how much revenue the FCC could raise from the auction, but it would also mean…less interoperability among LTE devices for wireless consumers.
Which means bad for the economy. Which is why the Media Marxist Left wants it.
Why is the federal government about to give it to them?
[Originally published at Human Events]
A nation without adequate energy production is a nation in decline and that has been the President’s agenda since the day he took office in 2009. He even announced his war on coal during the 2008 campaign even though, at the time, it was providing fifty percent of the electricity being utilized.
It’s useful to know that the U.S. has huge coal reserves, enough to provide energy for hundreds of years and reduce our debt through its export to nations such as Japan. It increased coal-fired power generation by ten percent in 2013 while Germany’s coal use reached the highest level since 1990. Both China and India are increasing the use of coal. So why is coal unwelcome in the U.S.? Because Obama says so.
On April 15, the White House held a “Solar Summit” to continue promoting subsidies for solar panels and the Obama Energy Department has announced another $15 million in “solar market pathways” to fund local government’s use of solar energy. Its “Capital Solar Challenge” is directing federal agencies, military bases, and other federally subsidized buildings to use solar power.
According to the Institute for Energy Research, “solar energy provides two-tenths of one percent of the total energy consumed in the United States. While the amount of solar electricity capacity in the U.S. has increased in recent years…it still only accounts for 0.1% of net electricity generated…the least among the renewable sources of hydroelectric, biomass, wind and solar.”
So, in addition to the millions lost in earlier loans to solar companies like Solyndra that failed not long after pocketing our tax dollars, Obama is using the power of the federal government to waste more money on this unpredictable—the Sun only shines in the daytime and clouds can get in the way—source of energy whose “solar farms” take up many acres just to provide a faction of what a coal-fired or natural gas powered plant does.
This isn’t some loony environmental theory at work although the Greens oppose all manner of energy provision and use whether it is coal, oil or natural gas. They always find an excuse to mine or extract it. This is a direct attack on the provision of energy, fueled by any source, that America needs to function and meeting the needs of its population, manufacturing, and all other uses.
The most recent example of this is the further extension of the delay on the construction of the Keystone XL pipeline from Canada to refineries on the Gulf Coast. That too is part of Obama’s war on energy for the nation, but it may also have something to do with the fact that the Burlington Santa Fe Railroad owns all of the rail lines in the U.S. connecting to western Canada. They haul 80% or more of the crude oil from Canada to the Midwest and Texas, earning a tidy sum in the process. It is owned by Warren Buffett’s Berkshire Hathaway, a major contributor to Democrat causes and candidates. The Keystone XL pipeline could divert more than $2 billion a year and if its delay is not crony capitalism, nothing is.
This is what the Sierra Club is telling its members and supporters as of Monday, April 21: “Keystone XL means cancer. It means wolf blood spilled. And it’s nothing short of a climate disaster.” It is a lie from start to finish.
Keystone has become a political issue and the announcement by the Obama State Department that is giving agencies “additional time” to approve its construction due to ongoing litigation before the Nebraska Supreme Court that could affect its route brought forth protests from red-state Democrats in Congress who even threatened to find ways to go around the President to get the project approved. Eleven Democratic senators have written to the President to urge him to make a final decision by the end of May. Some of them will be up for reelection in the November midterm elections.
Even Congress, though, seems incapable of over-ruling or overcoming Obama’s war on the provision of energy sources. In early April, the Bureau of Land Management (BLM) released new data showing that federal onshore oil and natural gas leases and drilling permits are at the lowest levels in more than a decade. Leases to companies exploring the potential of oil and natural gas reserves were down in 2013 from 1.8 million acres the year before to 1.2 million, the smallest area since records began to be maintained in 1988!
We have a President who gives daily evidence of his contempt both for those who voted for him and those who did not. His anti-energy agenda impacts on the creation of jobs, causes manufacturing to delay expansion or to go off-shore, reduces the revenue the government needs to reduce its debts and deficits, and drives up the cost of energy for everyone.
And he is doing this in one of the most energy-rich nations on the planet.
[Originally published at Warning Signs]
Regardless of where someone may view himself along the political spectrum (conservative, libertarian, or modern liberal), there are always a variety of government programs and activities that they either think are not worth the money or should not be the business of government in the first place. Yet, it seems almost impossible to rein in government. It keeps growing in size and scope in one direction after another. Why? And is there any way to reverse it?
Growing Government Spending and Taxing
The federal government keeps getting bigger and more intrusive and more costly. In the 2013 fiscal year that ended on September 30, 2013, Washington spent a bit more than $3.4 trillion. This compares (in inflation-adjusted 2013 dollars) with 2.1 trillion in 1993. In other words federal spending has increased by 62 percent over the last twenty years.
The same dramatic growth has occurred on the revenue side. The federal government took in about $2.8 trillion in taxes in fiscal 2013, compared to $1.7 trillion in 1993 (in 2013 inflation-adjusted dollars), for a 65 percent increase in government revenues compared to two decades ago.
This increase in expenditures and revenues over the last twenty years is reflected in the tax burden on the American people. The average household paid $28,205 in taxes to the federal government in 2013, up from $22,230 (in inflation-adjusted 2013 dollars) in 1993, or a 27 percent increase in twenty years. While the population of the country has increased by around 22 percent during this time period, per capita federal government spending has risen by 33 percent.
Both “entitlement” spending (Social Security, Medicare) and “discretionary” spending (including defense) have significantly increased over these two decades. Discretionary spending went up about 50 percent over this period, while entitlement spending rose by 100 percent.Special Interests and the Growth in Government
According to “public choice” theory, this growth in government transcends the political differences in modern democratic society. Rather, it is structured into the existing political system itself.
Public choice theorists are economists who argue that the political process should be studied in the same manner as markets are analyzed. Over the last several decades, they have attempted to explain the factors behind the growth of government in modern democratic society. They say that individuals in the political arena are motivated by self-interested goals (which can include ideological or ethical ends, as well as financial gains).
This self-interest prompts individuals and “special interest” pressure groups to weigh the costs and the benefits in deciding to be for or against various government policies; and they attempt to influence political outcomes through their votes, their campaign contributions, and their lobbying expenditures.
Their goal to obtain through either government regulations or income redistribution what they cannot or do not want to peacefully and voluntarily acquire on the open, competitive market: other people’s money.
Rather than earning the revenues or income they desire by offering the consuming public more, better and less expensive products, they turn to government to get anti-competitive domestic regulations, import restrictions against foreign rivals, or subsidies or government contracts to acquire the additional wealth they want — all at taxpayers — and consumers’ expense, of course.
If they are “non-profits” such as many environmental groups, they turn to government to restrict people’s use of their own private property through land use prohibitions or regulations, or through government control and ownership of land and wildlife they want preserved from private access and development. Unable to persuade enough of their fellow citizens to voluntarily contribute sufficient money to buy up and maintain the land they wish “untouched by man,” they turn to the coercive power of government to get what they want through taxes and regulations.Politicians, Bureaucrats and the Growth in Government
Politicians, on the other hand, desire to be elected and reelected. They gain political office by “selling” programs, regulations, and spending taxpayer dollars for the benefit of various constituent groups whose campaign contributions and votes they hope to receive.
Why do they want to be elected or reelected? So they can impose on the citizenry — both supporters and those who may have voted against them — programs and spending and taxing that they arrogantly presume to be good for “the people,” under the presumption that they know what is good for others; and which those others would want of their own free will if only they were intelligent enough to have the wisdom and values that those holding political office believe they possess.
Of course, sometimes the desire for political office arises out of pure personal ambition, including the desire to “leave their mark on history,” their “legacy” that future generations of little children will learn about in government schools. And, sometimes, it is the simple desire for power over others, and any material wealth that can come their way through political plunder and manipulation.
Those who run the government bureaucracies desire larger budgets and greater administrative responsibilities over economic and social affairs. They hope to gain promotions, higher salaries, and more control through discretionary decision-making.
Larger budgets and expanded regulatory authority opens the door to promotions and higher salaries in the government pay grades. In addition, some of those in the government departments, bureaus, and agencies suffer from the “psychology of the petty bureaucrat” who craves power over others; others who deferentially have to come to them and plead for the regulatory and licensing permissions without which the honest men of the market place cannot go about their productive business.Bureaucrat’s Incentive to Never Get the Job Done
There is also a perverse incentive mechanism within the halls of bureaucratic power. Those who manage and work in these government departments and agencies have little or no incentive to “solve” the problems for which their department or agency was originally created. If they do so they lose the rationale for maintenance of or increase in the budgets and authority without which they have neither their incomes nor positions.
This stands in stark contrast to the incentives for the private enterpriser in the competitive market. In the free market there is only one way to gain and retain the consumer business from whose purchases market-base enterprises earn their revenues: to solve people’s problems.
It may be a tastier coffee or frozen dinner; or a more wrinkle-free shirt or suit; or a longer-lasting chewing gum; or better fitting and lighter wearing prescription eye glasses; or a better quality and less expensive private education; or a wider covering and lower premium car insurance or health insurance policy. Whatever it may be, in the voluntary free market attracting customers and winning their repeat business requires private enterprisers to make people’s lives easier, more comfortable and less expensive.
There are no such incentives within the government bureaucracies, in which the “servants of the people” have monopoly control over certain services and regulatory rules and permissions. In addition, they acquire their incomes not through voluntary transactions but through compulsory taxation.
If this is the crude, but no less true reality behind the “public interest” and “general welfare” political rhetoric and ideology with which those in political power attempt to mesmerize citizens and taxpayers, then why, once it is understood, does the governmental system of paternalism and plunder persist?Concentration of Benefits, Diffusion of Burdens
One of the core ideas of the public choice theorists is that there is a bias toward growth in government spending and redistribution that results from the pattern of a “concentration of benefits and a diffusion of burdens.” The logic of this process was actually explained more than a century ago, in 1896, by the famous Italian economist and sociologist Vilfredo Pareto.
Imagine that in a country of 30 million people, the government proposes to tax each citizen $1 more, and then redistribute the extra $30 million among a special interest group of 30 individuals. Each taxpayer will have one extra dollar taken away from them by the government for the year, while each of the 30 recipients of this wealth transfer will annually gain an extra one million dollars.
Pareto suggested that the 30 recipients would collectively have a strong incentive to lobby, influence, and even corruptly “buy” the votes of the politicians able to pass this redistributive legislation. Each individual taxpayer, on the other hand, will have little incentive to spend the time and effort to counter-lobby, influence, and petition members of the legislature merely to save one dollar off his or her tax bill.
Let’s look at the U.S. federal government’s budget. In 2013, the per capita amount of government expenditures was around $11,000 for every man, woman and child. Not everyone, of course, pays taxes. The average taxpayer burden of government spending in 2013 came to around $26,000. However, the cost of each of the government departments and bureaus and the specific line items in their respective budgets was only a fraction of the overall tax burden.Big Government Spending, Individual’s Tax Burdens
Suppose a “conservative” is critical of the Department of Education, thinking that many of its activities are misplaced, or perhaps that the whole department should be abolished. While the Department of Education spent nearly $72 billion last year, the average taxpayer only shoulder $522 of this expense or on average only $43.50 in monthly taxes, which came to around $1.45 a day. This is far less than a latte at Starbucks or a lunch meal at a fast food establishment.
In most instances, it would be hard to interest a member of the general taxpaying public to learn enough about the pros and cons of the actual programs run by the Department of Education for him to make an informed decision as to whether nor not what the Education Department was doing was really worth it. After all, even if the Department of Education was abolished, it would save the average taxpayer less than two dollars a day, assuming taxes were cut by the full amount.
On the other hand, that $72 billion is concentrated on the incomes and activities of, at most, several hundreds of thousands of teachers, educators, school administrators, and textbook and school-supply providers. Those federal dollars represent a sizable portion of their administrative budgets, take-home pay, and business profits. The lobbying and voting incentives, therefore, will be heavily on the side of those who see financial and related gains from continuing and increasing federal spending on government-funded education.
Someone on the “liberal” side of the political spectrum might be equally critical of some of the line item spending in the Department of Defense budget, or on subsidies to corporate agri-businesses funded by the Department of Agriculture. But the same bias would work in these areas of government activity, as well, making it difficult to create the necessary political counterweights to lobby for the reduction or elimination of these federal programs.
The Defense Department’s spending on warplanes and battleships, uniforms and boots, ammunition and weaponry, spying devices and unmanned drones represents hundreds of millions, sometimes billions of dollars to the various contractors who win and fulfill these military contracts. They have a strong incentive to lobby and influence for the greatest amount of defense-related spending, and to know every detail and potential rationale to demonstrate that such expenditures are in the “national interest” and why they are the right ones to get the taxpayer-funded procurement deals.
But how many taxpayers will have the motive and incentive to wade through all the (unclassified) details concerning the various parts of Defense Department spending to make an informed decision about how much defense spending America needs and of what type, considering that even if some programs were to be cut back or eliminated it would maybe result in a cut in his personal taxes by the equivalent of a few dollars a day. For most individual citizens their time and attention have a higher value in doing other things.
Because of this, government tends to grow in many directions in the form of concentrated benefits for special interest groups of all types at the expense of the general citizenry and taxpayers. The dispersed financial burden that falls on each taxpayer as his “contribution” to fund these programs nonetheless adds up, of course, to hundreds of billions, indeed trillions, of dollars a year of government spending.Division of Labor and the Bias Toward Producer Interests
Since the time of Adam Smith in the eighteenth century, economists have emphasized the productive benefits from specialization through the division of labor. Each of us will be materially far better off if we specialize in what we are relatively more productive at doing, and then trade away our particular good or service for what others are offering to sell us. This is really the basis for all the material, scientific, intellectual, and cultural advancements of modern civilization.
But near the beginning of the twentieth century, British economist Philip Wicksteed pointed out, in his The Common Sense of Political Economy (1910), that such specialization also tends to create a bias against the open, competitive market in which people need to apply themselves in the most productive and cost-efficient ways. This was also strongly emphasized by the free market, German economist Wilhelm R’pke, in his work, The Social Crisis of Our Time (1942).
Once individuals have divided their labors, each becomes the producer of one product (or at most a small handful of things) and the consumer of all the multitudes of goods that others in society produce. But it is impossible for any of us to buy the goods that others offer to us as consumers, unless we have first succeeded in earning an income from what we are selling on the market in our own role as a producer.
Because of this, our interest as a producer always tends to take precedence over our role as a consumer, it has been argued. If I oppose some special interest group that is trying to get a subsidy from the government, I may save a dollar in my role as taxpayer and consumer (to use the earlier example from Pareto). But is it worth the cost in time, effort and expenditure to do so?
On the other hand, lobbying and otherwise influencing the legislative process to win some favor or privilege for myself and the others in my sector of the economy may produce better financial results. A protective tariff to limit foreign competition, for example, or a regulatory or licensing rule that restricts new domestic rivals can increase my income per year by tens of thousands of dollars, in my role as a producer.The Democratic Dilemma and the Need to Limit Government
This is, in a sense, the modern democratic dilemma.
Over the last one hundred years, there have been fewer and fewer restraints on what is viewed as the proper role of government in society. The arena in which government may take an active part, both in the United States and around the world, grows ever wider. This widening arena of government has become the playground of special interest politicking from both the political “left” and “right” by those hoping to gain something through government intervention at the expense of others in society.
In 2013, there were over 12,000 registered lobbying groups in Washington, D.C. They officially spent more than $3.2 billion in 2013 to influence legislation on behalf of special interest groups from across the political spectrum, and reflecting virtually every sector of the U.S. economy. Just since this century began in 2001, annual spending by Washington-based lobbying groups (in real inflation-adjusted dollars) has increased by nearly 50 percent.
How do we break out of this dilemma, and return to limited government? Unfortunately, there are no electoral “quick fixes” or political sleights-of-hand that can reduce or eliminate the political paternalism and plunder land of the modern interventionist welfare state.A Return to the Idea of Individual Rights Inviolable by Government
It requires a sea change in the philosophical, ethical and political-economic premises upon which American society operates. In other words, those of us who believe in and desire liberty and a free society must return to “first principles” and articulate the same to others.
We must hone our own understanding of the ideas and ideals upon which the United States was originally founded, and most especially as enunciated in the Declaration of Independence, where it was clearly and explicitly stated that freedom is inseparable from the recognition and defense of those inalienable rights to “life, liberty, and the pursuit of happiness” that are universally possessed by each and every individual.
In more modern times, Ayn Rand expressed this concisely and insightfully in her essay, “Man’s Rights” (1963):
“If one wishes to advocate a free society — that is, capitalism — one must realize that its indispensible foundation is the principle of individual rights. If one wishes to uphold individual rights, one must realize that capitalism is the only system that can uphold and protect them.
“Rights are a moral concept . . . the concept preserves and protects individual morality in a social context … the link between the moral code of a man and the legal code of a society, between ethics and politics. Individual rights are the means of subordinating society to moral law . . .
“A ‘right’ is a moral principle defining and sanctioning a man’s freedom of action in a social context. There is only one fundamental right . . . a man’s right to his own life . . . The right to life is the source of all rights … and the right to property is their only implementation. Without property rights, no other rights are possible. Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means of sustaining his life. The man who produces while others dispose of his product, is a slave . . .
“The United States regarded man as an end in himself, and society as a means to the peaceful, orderly, voluntary coexistence of individuals . . . and that the only moral purpose of a government is the protection of individual rights . . .
“To violate man’s rights means to compel him to act against his own judgment, or to expropriate his values. Basically, there is only one way to do it: by the use of physical force. There are two potential violators of man’s rights: the criminals and the government.
“The great achievement of the United States was to draw a distinction between the these two — by forbidding to the second [government] the legalized version of the activities of the first [private plunder].”
As long as people believe that “society” or the “democratic majority” or some empty notion of the “general welfare” comes before and is above the rights and interests of the peaceful individual, then there will be no breaking out of the trend towards the growing size and scope of government’s controlling reach over all of us.
It must become “second nature,” a “habit of the mind” for Americans in general to once more take it for granted that certain things are, well, “just not done.” And more precisely, that it is the duty of government to protect the right of each individual to his life, liberty, and honestly acquired property, and not to violate that person’s rights.
For it to become “second nature” and a “habit of the mind” again, people must rediscover the reason for and rightness of an inviolable “right” of each individual to his own life, which should not be sacrificed to some mystical and imagined “higher good” or any collective entity called “the nation,” or the “state” or “society.”
This is why, in answer to her own question, “Philosophy, Who Needs It?” Ayn Rand once argued that each of us does; we must become intelligent students of the theory of individual rights based on reason and reality.Changing the Course of Human Events with Right Ideas
Enough of us have to have sufficiently done so that we can explain to others the essentials of such a theory of individual rights, and with sufficient persuasiveness that those other, too, come to see the rightness in them. Then it won’t matter that most people never have an incentive to know enough to decide whether the U.S. Department of Education is spending too little or too much on a “common core” curriculum or whether the Defense Department has just the right number of aircraft or ocean vessels to “police the world.”
Enough people will enter the voting booth and think as “second nature” and as a “habit of the mind,” is this candidate for or against respect for and protection of individual rights? Does this party platform advocate or oppose private property and free market capitalism? Does this party and these candidates believe that the function of government is to defensively protect the citizens of the country from the clear and present dangers of foreign aggressors or do they wish to sacrifice the lives and fortunes of Americans in foreign adventures and wars?
Most people, if they see a person drop their wallet will pick it up and hand it back to them, because as “second nature” and “habit of the mind” they take for granted that taking what belongs to another is “wrong.” For a free society to prevail it is necessary for many people to no longer give even a second thought that it is ethically right for them to run to government and take by political power what they would never think of stealing in their private interactions with others.
It is not that advocacy of liberty should become a “prejudice,” that is, a preconceived idea not based on reasoned reflection or learned experience. A mere “faith” in freedom without a well-grounded set of reasons for advocating it will not sustain a free society in the long run.
What it does mean is the each generation must be encouraged to think about and learn the meaning of individual rights, and what they imply about the nature of man, human associations, and the role and place of a government in society.
If properly and effectively understood, it will become the generally accepted notion that, “Well, every thinking and reasonable person knows that . . . using the coercive power of the government to compel any man to sacrifice his life for others is as ethically not right as expecting others to be forced to sacrifice for him.”
Then, as a matter of implied “first principles” it will be impossible for some in the society to successfully coerce others through the tools of political power, because it will be culturally counter to the general “habit of the mind” that liberty is too precious as both a moral and practical matter to be forgone for even the most attractive short-run gains from political paternalism and plunder.
It is neither an easy nor a quick task to change, in this sense, the “climate of opinion” about the appropriate moral order to sustain a free, prosperous and ethically healthy society. But we have no tools other than our minds and our reason and an understanding that it is in our own self-interests to try.
If enough of us take on this task the growth in government can be both halted and reversed. The world of coercive plunder can be replaced with a human community of free men pursuing mutually beneficial peaceful production. The democratic dilemma of every growing government will be brought to an end.
[Originally posted at EpicTimes]
There was a time when downtown Los Angeles was the commercial center of Southern California. According to Robert Fogelson, writing in his classic Downtown: Its Rise and Fall (1880-1950)“nearly half” of Los Angeles residents went downtown every day in the middle 1920s. A time traveler from 1925 might think that to still be the case, with the concentration of tall buildings, and the frequent press reports about downtown’s resurgence.
Downtown LA got a late start with high-rises. Until the middle 1960s, there were few buildings exceeding the 13 story height limit repealed in 1958 by city of Los Angeles. The most important exception is City Hall, opened in 1928, which is 454 feet tall (137 meters). By 1989, the city’s tallest building, Library Tower (First Interstate Tower), had been opened, topping out at 1,018 feet (310 meters). The under-construction Wilshire-Grand Towerwill soon rise 80 feet (25 meters) above Library Tower. From the flight path to Los Angeles International Airport (above) and many ground vistas, the vertical profile of downtown Los Angeles will continue to stand tall over the city.
Yet, far less understood is that downtown has declined in metropolitan importance for decades. Now, downtown has only 2.4 percent of employment the metropolitan area (Los Angeles and Orange Counties). Between the 2000 Census and the 2006-2010 American Community Survey, employment in the central business district dropped approximately five percent. At least four other employment areas, all freeway oriented with lower employment density, equal or exceed downtown’s employment (these include the Airport-El Segundo area and nameless employment areas straddling the Santa Ana Freeway in Los Angeles County, the Harbor and San Diego Freeways in the South Bay and the Costa Mesa Freeway in Orange County). More important still, approximately two-thirds the metropolitan area’s employment is not in a large employment area at all. This dispersion of employment is one reason why Los Angeles –despite its reputation for horrendous traffic – has the shortest one-way commute time of any world megacity for which there is data.
Following World War II, the heart of downtown Los Angeles shifted west from Broadway, Hill and Spring Streets, leaving a large stock of quality commercial buildings vacant. This was well before the end of their useful lives, yet decades of disuse followed. Most of these buildings rose to the 13 floors height limit, though one, the 18 story United California Bank headquarters at 6th and Spring, was completed not long before its competitors hired moving vans to move west. Soon after, the United California Bank built the UCB Tower (now Aon Tower) on Hope Street, with 62 floors (1973), which at the time was the tallest building in the world outside New York and Chicago.
The UCB Building and many more on the now more residential east side of downtown been converted to apartments and condominiums under the city’s creative “adaptive reuse” ordinance, which facilitates conversions from office to residential use. According to the city of Los Angeles, the ordinance has facilitated conversion of downtown commercial space into more than 3,000 residential units. Another 7,000 are either under construction or being considered.
The conversion of office buildings to residential has spread to post war structures, such as theMobil Oil Building (now the Pegasus Apartments). This building, on Flower Street, was one of the earliest examples of the more modern styles that were to proliferate throughout the downtown areas of the nation. The Signal Oil Building, also one of the first to exceed the 13 story limit has also become residential (1010 Wilshire). This building had been the subject of an unusual 1980s remodeling that enlarged the footprint and the floors, while materially changing the outside angles and the decor. Another nearby office building (1100 Wilshire) sat empty for two decades after construction, before being converted to residential use.
The shift to residential makes sense given that most downtown office buildings are having difficulty filling their space. Downtown’s glutted office market is indicated by a 19.2 percent vacancy rate in the fourth quarter of 2013. This is better than such market laggards as downtown Detroit or downtown Dallas, both over 20 percent, but higher than the Los Angeles suburban office vacancy rate, at 15.9 percent. Downtown’s vacancy rate is also approximately double or more those of dynamic downtowns such as San Francisco, Boston, New York, and Houston, which are all under 10 percent (Figure 1).
It appears likely that the Crocker Citizens Plaza, opened as the city’s tallest building in 1969 (42 floors), is slated for conversion to residential. After Crocker Bank moved to its new Crocker Center (now Wells Fargo Center) on Bunker Hill, Crocker Citizens Plaza became the AT&T Building. AT&T vacated the building and moved to the earlier 1960s Transamerica Building, which urban legend indicates was built well south of downtown because consultants convinced the developers that this would be the center of an even larger downtown. The Transamerica, now AT&T, is even more divorced from the commercial core than when it was built. By the time Crocker Citizens Plaza (now “611 Place”) is converted to residential, it could be the third tallest mixed use building in downtown.
The second tallest mixed use tower could well be the prestigious Library Tower, which stands half-empty. There are rumors that the new owners may convert a large part of the structure to condominiums and a hotel. No major office skyscraper has opened in downtown Los Angeles in the last 20 years. Nor will that change when the Wilshire Grand Tower is completed. Wilshire-Grand will only be partially an office tower and will include a hotel. Only 30 of the 73 floors will be offices. This is a climb-down from the original design, which included two buildings – a 60 story office tower and a 40 floor hotel and condominium project. The new building is little of an endorsement of downtown’s office demand.
Transitioning from Adaptive Reuse?
This conversions may be the tail end of trend. DT News reports that it has become more economical for many developers to construct new residential buildings, rather than to convert empty commercial buildings. As demand has increased, so have prices of existing buildings, which makes adaptive reuse less attractive. Further, many of the structures on Broadway, which casual observation might indicate have potential for conversion, but the density of development may make offering enough natural light difficult for residences.
Ups and Downs of Downtowns
As employment has dispersed throughout the Los Angeles area, there has been less of a need for a central business district. Among the nation’s larger downtowns, only downtown Los Angeles has undertaken wholesale abandonment of its commercial core and built a new one. Perhaps this is, in part, because the 13-story height limit rendered the older buildings uneconomic for the second half of the 20th century.
New York (Manhattan), south of 59th Street also has seen its ups and downs. But New York did not abandon large swaths of development, only to move elsewhere. Downtown Chicago expanded northward along Michigan Avenue, but little if any of the Loop was ever abandoned and it has undergone continuous renewal. The West Coast’s premium downtown areas, San Francisco and Seattle, have interspersed new development along with the old, and remain more important to their metropolitan areas than downtown Los Angeles, accounting for from four to six times its employment share (though still less than 15 percent). Even Houston, which most resembles Los Angeles in its post war downtown rebuild, managed its transformation without abandoning the historic core. And, at the same time, all are enjoying increasing residential demand, like downtown Los Angeles.
Downtown interests are rightly proud of the rising residential population. This has occurred in many downtowns across the nation. Between 2000 and 2010, areas within 2 miles of City Hall gained 206,000 residents in the major metropolitan areas (over 1 million population). However, within in the next ring, from 2 to 5 miles from City Hall the decline in population more than compensated for the core gains (minus 272,000).
The situation was the same in Los Angeles, where the Census Bureau reports that population within 2 miles of City Hall rose 12,000, while it declined 23,000 between 2 and 5 miles. The growth of downtown Los Angeles is impressive in part because it was stagnant for so many decades. In context, however, it is no “game-changer.” Overall in the last decade all growth in the Los Angeles metropolitan area was outside the 5 mile ring, and 75 percent of that was more than 20 miles from City Hall (Figure 2).
A New Species is Born
It would be a mistake to characterize the emerging downtown Los Angeles as reasserting any economic primacy. Its former function is beyond revival. This was indicated by UCLA Anderson Forecast economist David Shulman, who indicated that he was “not bullish on Downtown Los Angeles.” The report by public radio station KPCC continued:
“That view runs counter to the impression that downtown L.A. is staging an urban comeback. But the resurgence is more about sports and entertainment venues, restaurants and bars, loft conversions, and hotels than it is about companies that need a lot of floors in tall buildings. Nightlife and streetscapes trump florescent light and cubicles.”
This refers to the new entertainment venues, such as the Staples Center, the Walt Disney Concert Hall and “LA Live,” which may be joined by a new football stadium for a proposed National Football League franchise.
The transformation of downtown Los Angeles is not so much a renaissance of a business core, but a shift into a new, and different, function. The new downtown serves a function similar to that of Wilshire Boulevard’s more heavily residential high-rise district. But it’s not likely to ever resemble the Upper East Side or Upper West Side in New York, not only because its residential base will remain small, but because downtown is hardly an ascendant business center. Downtown’s recovery as a residential district – with a population roughly equivalent to the suburb of Diamond Bar – is indeed impressive, but its role as a vital urban economic center remains relatively small.
[Originally posted at New Geography]
I borrow from FTC Commissioner Maureen Ohlhausen’s address, “The Procrustean Problem with Prescriptive Regulation,” delivered at the Free State Foundation’s Sixth Annual Telecom Policy Conference on March 18. If you missed the conference and haven’t seen the C-SPAN video of Commissioner Ohlhausen’s speech or read it, you should. It ought to be required reading at the FCC.
In her speech, Commissioner Ohlhausen briefly relates the Greek myth of Procrustes:
“Procrustes was a rogue blacksmith, a son of the sea god Poseidon, who offered weary travelers a bed for the night. He even built an iron bed especially for his guests. But there was a catch: if the visitor was too small for the bed, Procrustes would forcefully stretch the guest’s limbs until they fit. If the visitor was too big for the bed, Procrustes would amputate limbs as necessary to fit them to the bed. Eventually, Procrustes met his demise at the hand of Greek hero Theseus, who fit Procrustes to his own bed by cutting off his head.”
According to Commissioner Ohlhausen, “[t]he general lesson of Procrustes is a warning against the tendency to squeeze complicated things into simple boxes, to take complicated ideas, technologies, or people, and force them to fit our preconceived models.” Hence, regulators should resist the urge to simplify – to think they have the expertise or knowledge to simplify – and learn to tolerate complexity.
How should regulators confront the Procrustean problem? Commissioner Ohlhausen offers two fundamental principles, especially for those regulators who exercise authority in markets in which technology plays a large role: (1) embrace regulatory humility and (2) focus on evaluating consumer harm. As Commissioner Ohlhausen puts it: “Because it is so difficult to predict the future of technology, government officials…must approach new technologies and new business models with a significant dose of regulatory humility.”
With regard to the second principle, what Commissioner Ohlhausen says about the FTC should be equally applicable to the FCC as well: “By focusing on practices that are actually likely to harm consumers, the FTC has limited its forays into speculative harms, thereby preserving its resources for clear violations. I believe this self-restraint has been important to the FTC’s success in tackling a wide range of disparate problems without disrupting innovation.” The emphasis is on protecting consumers, not protecting competitors.
To adhere to the principles of embracing regulatory humility and focusing on consumer harm, Commissioner Ohlhausen emphasizes a point I have made in this space (literally) countless times: an ex post enforcement approach, based on the filing of individual complaints, is preferable to ex ante prescriptive regulations. As she puts it, the ex post enforcement method, employed by the FTC, “typically focuses on actual, or at least specifically alleged, harms rather than having to predict future harms more generally.” In contrast, the FCC’s general resort to prescriptive ex ante rulemakings necessarily suffers from systemic knowledge problems that are exacerbated in the context of a dynamic market with fast-changing business models and technologies.
Finally, and importantly, Commissioner Ohlhausen rightly takes on the invocation of the now common shibboleth, “data-driven.” Too many regulators, including those at the FCC, believe that if they simply repeat the well-worn mantra “our decisions are data-driven” that their actions ought to be accepted, without question, as proper. As Commissioner Ohlhausen reminds us: “[D]ata isn’t knowledge or wisdom. ‘Data-driven’ decisions can be wrong. Even worse, data-driven decisions can seem right while being wrong.”
I was pleased that Commissioner Ohlhausen suggested some skepticism is warranted regarding ritual incantations of “data-driven” decision-making because, frankly, I have been doing the same for years. As I said in a blog three years ago, “data, no matter how sweet-sounding the oft-repeated ‘data-driven’ mantra … is viewed differently, and put to different uses, depending upon one’s regulatory philosophy and perspective.” Or, to the very same point, in a 2010 piece I suggested Chairman Genachowski’s “data driven” mantra, even then, already was being overworked because “regulatory philosophy matters a lot” in deciding how to interpret and make use of data.
I’m certain that Commissioner Ohlhausen doesn’t mean to imply that regulators should not seek to obtain relevant, accurate data, or ignore it when they have it. And I don’t either.
But I do want to suggest that, by following Commissioner Ohlhausen’s two fundamental principles – embracing regulatory humility and focusing on consumer harm – the temptation of regulators to cover shoddy reasoning by invoking the “data-driven” mantra may be lessened. That is to say that abiding by the principles enunciated by Commissioner Ohlhausen will lead to sounder decisions that are less dogmatically pro-regulatory. Overall consumer welfare is more likely to be improved by such decision-making.
In the next year, the FCC will be making some important decisions in major proceedings – for example, in the incentive auction, the Comcast-Time Warner Cable merger, and IP transition proceedings, to name but three. Free State Foundation scholars have addressed issues in each of these proceedings before, and I am certain we will do so again in the months to come. I don’t want to do so here.
Except to say, in closing, that I am confident the Commission’s decisions in these matters, and others, will benefit consumers most if Chairman Tom Wheeler and his colleagues take to heart Commissioner Ohlhausen’s message concerning the virtue of regulatory humility.
That means slaying Procrustes in his own bed at the FCC.
[Originally published at the Free State Foundation]
Try to ignore Earth Day, April 22. It won’t be easy. The print and broadcast media will engage in an orgy of environmental tall tales and the usual end-of-the-world predictions. It will scare the heck out of youngsters and bore the heck out of anyone old enough to know that we have had to endure the lies that hide the agendas that have driven the Greens since 1970 when the event was first proclaimed.
The Earth is 4.5 billion years old. It is the third planet from the Sun and fifth-largest of the eight other planets that orbit it. It is the only planet in our galaxy that has life on it and it has an abundance of mineral resources as well as water and the fecundity to grow crops and maintain livestock to sustain the human race.
The climate on Earth is entirely dependent on the natural cycles of the Sun. Despite four decades of being told that the Earth was going to heat up due to greenhouse gas like carbon dioxide and methane, we are currently in a cooling cycle and no child born since 1997 has ever experienced a single day of the dreaded “global warming.”
Humans play a very small role affecting the Earth’s climate although, for example, deforestration is one way it has affects it. Other than cutting down trees, another way is to put the government in charge of vast acres of forest. It has a long record of failing to manage them well to the point where diseases and pests render the trees so weak that wildfires wipe out what would otherwise have thrived.
Otherwise, the Earth is and always has a been a very volatile place, subject to a variety of extraordinary natural events such as hurricanes, tsunamis, blizzards, floods, droughts, tornadoes, and earthquakes. The only thing humans can do is clean up and rebuild.
What has mostly changed for humans has been the discovery of energy sources that have transformed and enhanced their lives. Coal, initially, followed by oil and natural gas. All are carbon based, but then, so are humans and other life forms.
The Greens call them “fossil fuels” and some refer to “dirty coal” or seek to demonize “Big Oil.” Between 2007 and 2012, three U.S. oil companies paid a total of $289.7 billion in corporate income taxes. Until the Obama administration took power, coal provided fifty percent of all the electricity Americans used. Completely bogus “science” cited by the Environmental Protection Agency has been used to shut down coal-fired plants and close down coal mines. And, in concert with costly, unpredictable and unreliable “renewable” energy, wind and solar, have driven up the cost of electricity for everyone.
According to a study by the Heritage Foundation, released in March, over the next two decades the EPA’s climate rules aimed at reducing “global warming” (which is not occurring) will cost the economy $2.23 trillion. An estimated 600,000 jobs will be lost. The jobs that would be created by the Keystone XL pipeline have been waiting five years for the White House to approve the project.
As mentioned, it has been the many inventions that utilize the energy sources the Greens want to “leave in the ground” that have totally transformed the lives of Americans and others throughout the world. What Earth Day is really about is not the improvement of life, but limits that will reduce the world’s population. The one thing all environmentalists agree upon is that there are too many humans. This is a form of fascism that goes back to the creation of the communist/socialist economic systems, none of which have provided the level of prosperity that capitalism has. Even Communist China has adopted the capitalist model.
The other agenda Greens agree upon is that the government should own and control every square inch of the nation’s (and world’s) landmass. That is why climate change is part of the United Nations’ intention to become the single world government. It is home to the Intergovernmental Panel on Climate Change that has clung to the global warming hoax since they invented it in the late 1980s.
Recently, the IPCC released another report claiming “climate change” will melt polar ice, cause the oceans to rise dramatically, generate extreme weather conditions, et cetera. There have always been extreme weather conditions somewhere and the rest of the IPCC claims are just great big lies that have been around for decades.
Along the way, environmental organizations such as Greenpeace, Sierra Club, and Friends of the Earth, among countless others of comparable or lesser size have received millions in membership dues, donations, the sale of products, and from the assets that many own. Many, like Greenpeace, enjoy a non-profit status. For example, in 2011, Greenpeace took in $27,465,948 and had assets of $4,653,179. Multiply that against all the others and it adds up to billions.
Green organizations represent a very big business that is constantly at war with legitimate businesses in the energy, manufacturing, and agricultural sectors, seeking to impose laws and regulations that cost them and consumers billions every year.
If you’re a parent take some time to explain to younger children that the Earth is very old and not going to suffer the claims Greens repeat and repeat. As for everyone else, just try to ignore the Earth Day deluge. It won’t be easy, but it will be worth it.
[Originally published at Warning Signs]
School teachers all over the nation are quitting their profession, often due to being forced to abandon what they considered an excellent education system and change to one they consider inferior. The faulty system they refer to is the new and highly controversial Common Core. Susan Sluyter recently provided her reason for resigning after 25 years of teaching. She stated “I have watched as my job requirements swung away from a focus on the children, their individual learning styles, emotional needs, and their individual families, interests and strengths, to a focus on testing, assessing, and scoring young children, thereby ramping up the academic demands and pressures on them.”
One theory for developing Common Core, touted by those who initiated the experimental program, is the advantage of creating a common set of standards for all the states. However, opponents say that this one-size-fits-all approach to education is flawed and robs states of their individuality. Opponents also state that it isn’t just the standards that are being criticized. The bigger problem is the curriculum that supports the standards that has parents, teachers, and concerned citizens forming pockets of protests throughout America.
Proponents of Common Core like to portray the opposition movement as one being driven by Tea Party members. While that group may oppose it, the reality is that the firestorm of opposition sweeping through the states is largely being fueled by parents of school children. These are people who had been busy raising their families, without the time or inclination to become involved in politics. Common Core turned them into political activists.
Heather Chappell and Susi Khan are examples of that. They are mothers in Yorba Linda, California and became concerned when Common Core was introduced at their school. They began to ask questions and did not like the answers they received. They took the time to investigate Common Core more thoroughly and discovered many others shared their concerns. Those two Moms found it alarming that most of their friends and neighbors had never even heard of the new education system.
They decided to organize an event to help others learn what they knew. Forming a small committee comprised of their friends, and with minimal publicity, Heather and Susi left their laundry choirs to plan an event and help others know the facts. About 250 people crowded into a church in their area to hear a presentation about Common Core. It was a huge success, which attracted a variety of people from all walks of life, age groups, and political backgrounds. Those results caused Heather and Susi to know people had a desires and need to know more about Common Core. They quickly put together another event.
But they are not alone! Parents just like them are popping up throughout America to aggressively protest against the controversial education system, causing state officials to take a second look at the problems inherent in Common Core.
Indiana Governor Mike Pence listened to the outrage and reports of problems that continued to plague his office. He recently decided to drop Common Core and replace it with a state program. He signed new legislation that made his state the first to opt out of Common Core standards. Pence unlocked the floodgates for more states to follow Indiana’s move against the ill-conceived federal intervention of Common Core. The two most obvious states are Scott Walker’s Wisconsin and Louisiana’s Bobby Jindal. Other states are concerned about the number and quality of the assessment tests, and have withdrawn from the Smarter Balanced coalition, choosing to use their own testing methods.
The obvious questions being asked are why and how did this controversial system quietly creep into all but five of our states? The answer to “why” depends upon who you ask. Promoters claim there needed to be a consistency of standards among all states, and that our education system was lacking when compared to other countries. Opponents argue each state should decide their own standards, based on their unique needs, and that if our education system is deficient, why are we inundated with students from most every other country who want to be educated here in America?
Opponents to the new system also resent that historical and federal education laws/rules were ignored by the relatively small group who developed and sold Common Core to the states. Which introduces the question: How did our entire nation, with the exclusion of five states, end up using Common Core? — Texas, Alaska, Minnesota, Nebraska, and Virginia.
The concept is an old idea whose roots date back to the United Nations and an ultra-liberal by the name of Robert Muller. He spent 40 years quietly working to create the “World Core Curriculum.” The first Robert Muller School was started in Arlington, Texas in 1979 to implement the World Core Curriculum with the objective of making it available to educators around the world. Muller’s “New Genesis,” published in 1982, sets forth in 27 chapter a blueprint for creating a world that will become a better place live in.
Since then many world leaders, including America’s “elitist,” decided to march in lock-step with the United Nation concept. That plan, which many of the same people embraced, is a “one-world” government and spirituality that includes a one religion, one world education system, one world government, etc. Actually, their plan includes pretty much the opposite of what our wise forefathers embraced. Need anything more be said on that subject? We know the result of our founding fathers’ efforts: The United States prospered beyond anyone’s imagination and developed into a World leader. So, why would anyone chance making radical changes, based on an agenda formed by the United Nations?
The designers of Common Core had a strategy to sell it to the States. The Obama administration had $4.35 billion of “Race to the Top” federal funds to offer states if they accepted Common Core. They also threw in a bonus of allowing states the option of dropping the highly unpopular “No Child Left Behind” program from George W. Bush’s days. Throw in a sales pitch inundated with lofty adjectives and promises of high achieving students, and the states couldn’t sign the dotted line fast enough. They were so eager to accept the unproven, untested program that some states did not bother to even run it by their Congress. What about the public comment period? How about examining the material first? Sorry! The curriculum wasn’t even developed, let alone available when those contracts were agreed upon.
People have asked if it is possible to have a recall of every state Governor who bought the bribes and who trusted without bothering to verify the promoters’ exaggerated promises. The public was not informed of the negative facts surrounding the issue, and the best source to educate the public was our media, but they remained relatively oblivious to these negatives. Could that be due to their largely liberal leanings and a reluctance to confront Democrats in power? If so, that is unfortunate, because all segments of our population, including those from every political affiliation, are questioning Common Core.
Were laws bent or broken in this process? There are lawyers developing a challenge based on that belief, but some claim the only way to defeat Common Core is for “We the People” to rise up and speak out against it. It will take a tidal wave of concerned citizens demanding the federal government scrap Common Core and return the responsibility for our children’s education to the state and local control. American citizens are not interested in accepting the U.N. mandates nor have we bought into a one world governing concept.”
Informed parents are not buying into the premise that our education system needed a total revision; just that It may have needed to be “tweaked” in specific areas. Quite “telling” is that the known problems and reasons for lower test scores were not even touched by the authors of Common Core. What are they?
Most experts agree that the following aspects contribute greatly to lower test scores in states:
1. Teacher Unions have been able to keep ineffective and low performing teachers from being fired. When parents become too noisy about a specific teacher’s shortcomings, she/he is moved to a school district in which parents are not as likely to complain: the same school districts most in need of quality teachers.
2. We are a nation of many cultures, some of which demand more of their children and teachers than others. One example are students in which English is their second language, and most often for their parents as well. With little help at home, those students lag far behind in their classes. Also, students from single family homes, who tragically miss their father and his support, cause Moms to struggle just to survive. There is no time or energy for her to work with her children’s school needs.
It should send chills up our spines knowing liberals managed to slip Common Core into our nation’s schools in such a relatively short period of time, without hardly a smidgeon of advanced warning, and in the absence of any proof it was superior. That was allowed to happen largely because of wealthy people who made huge contributions to promote it. Some question whether those contributions were for the altruistic purposes claimed. There is no doubt most everyone involved in the implementation of Common Core will be highly compensated in a variety of ways.
The following is a quote from a website that is devoted entirely to exposing the facts, faults, and failures of Common Core, as well as exposing the people who will profit from it. Please read their conclusion of Common Core very slowly and carefully to get the full impact of their massive research on the subject:
“Bill Gates is paying a “nonprofit” already overly involved in federal affairs to ‘help’ the USDOE (United States Dept. of Education) ‘improve’ its operations– and no doubt those ‘improvements’ will coincidentally serve the lucrative, privatizing purposes of the nonprofit-affiliated ‘improvers,’ not the least of which is planting carefully-groomed, privatizer neophytes into strategic governmental positions in order to propagate the corporate reform agenda for years to come.
“In short, those with obscene money are paying those wanting to make money to advise those with public money on how to best spend the public’s money.”
The important question remaining is what will YOU do to respond to the hijacking of our education system by “elites” who have “gamed” the system for personal profit at the expense of our children’s education. Will you speak out at a city council or board of education meeting? Will you contact your local newspaper; possibly write a letter to the editor? Will you organize an event in your home and invite your friends and relatives? How about scheduling a meeting with your local state official? Will you at the very least talk to others about this important issue?
[Originally published at Illinois Review]
I was fortunate to have wrestled under Bill Koll for three years at Penn State. I say fortunate not because of the beating I took on the mats with my 1-4 career record – we weren’t as good as we are now under Cael Sanderson, but we always were a top 10 dual meet team and dominated the east, in spite of fierce opposition from the likes of Lehigh and Navy – but because wrestling under Coach Koll and assistant Andy Matter re-enforced the values I learned from my parents. The child of strict Italian parents, my first year or two at Penn State was like a kid being released into a candy shop whose never had a sweet before. I almost flunked out of school, but once I went out for wrestling, my grades shot up as the discipline returned. I quickly understood that if you want something you have to work for it. It also showed me why athletics can be a huge aid in education if done right. A big lesson for me: If you want something and someone is smarter or stronger than you, you have to outwork them to even have a chance.
“Koll began his wrestling career in high school, winning the state title in 1941.
“After World War II, in which he participated in the Battle of the Bulge and D-Day, Koll dominated the 145 pound and 147.5 pound weight divisions. In 1946, 1947, and 1948, he was the NCAA national champion for his division. Koll was also named the NCAA Tournament Outstanding Wrestler in 1947 and 1948. He ended his career with a 72-0 record.
“Koll was one of only of five UNI wrestlers to have competed in Olympic games. In the 1948 games, held in London, England, Koll placed fifth.”
Most Penn State wrestlers have their favorite Bill Koll story. Mine is a little known one. I called him up about a week before Christmas one year to check up on him. He was excited to talk me. “Joe, I just got through making the most expensive doll house ever… It’s a three thousand dollar doll house.” (For his granddaughter).
My response: “Coach, how do you know it’s a three thousand dollar doll house?”
“Because that’s the hospital cost when you chop off some of your fingers.”
He liked to call himself “Sweet Ole Bill,” or if you preferred, S.O.B. for short.
To this very day, in spite of our fierce rivalry with Cornell, I remain friends with his son Rob, who is now their coach. In fact many of the people at Weatherbell.com are Cornell grads. I still want our guys to beat the tar out of any Cornell wrestler that happens to show his face on a mat across from a PSU wrestler.
Coach Koll (my coach Koll) used to have a saying: “If you had a lick of guts and an ounce of smarts,” you would have done this or that. In today’s world, that seems like a cruel admonishment, but he would say it about himself too. Something minor would happen and he would say, “Well if I had a lick of guts and an ounce of smarts, I would have done this.” It was never guts OR smarts – always guts and smarts.
Where is this leading? I think, regarding the climate issue, objective journalists today need to have an old school “lick of guts and an ounce of smarts” when reporting on this. (There are those that are beyond objective.)
First: You should not be reporting on “climate change.” The climate is always in a state of change. There have been glaciers in New York City, and most of what is now our most densely populated areas of the East Coast as well as the fertile lower Mississippi Valley was under water at one time. Right off the bat you should be asking, “Well, why is 4 -8 inches of sea level rise in 100-150 years a big deal compared to what has actually happened?” Alarmists said global warming. They own it. And journalists should make them own up to it. Why in the world are you letting them get away with switching horses mid-stream – climate change is obvious and natural – and not holding their feet to the fire?
Second: You should do the work yourself to see what is going on. The journalists of the ’70s and ’80s understood their job was to question authority, not obey it. I think part of the problem is that some of the great journalism of those days past made stars out of journalist. This granted them access to some of the glitter of stardom, and in a way, became a perk that many are seduced by today. I don’t know if it’s intentional. The current governor of Ohio, John Kasich, once told me to never let being on TV get in the way of what you are really made to do. (I used to love Saturday nights when he asked me to be on his show “Heartland.”) He said it can be seductive. I pooh poohed it for awhile, but then started noticing that if there were stretches no one asked me to be on, I started getting mad. He was right. Being in the media can be seductive.
Third: You are supposed to be liberal in the true sense of the word. That is akin to being able tothink with your head and pursue with your heart, and to do that you need a lick of guts and an ounce of smarts. Use the head first – not the heart! Being sheeplike is not the answer for a journalist. They go where they are told without thinking twice about it. Is this what journalism has become? I am not advocating you being wolves; perhaps more like a fox is better. But on this issue, one that is sapping our nation’s strength like heat out of a drafty house, we need true liberal-minded people to discern what is right and wrong. And that means taking you wherever the path of truth leads, not where it is you might want to go based on some high-minded abstract that can never be defined nor measured!
Let me give you just one example – global sea ice. Global warming was supposed to produce shrinking sea ice, right? How is that working out?
We are currently well above normal globally.
This is largely because of the expansion in the Southern Hemisphere, even more impressive since it’s expanding into an area that is almost all water, and it’s tougher to move the temperature of the oceans than land masses around it, such as the Arctic.
The coming Southern Hemisphere winter could result in record breaking sea ice extent. Last time that happened, the Northern Hemisphere was at record low levels in what AGW hysteria was promoting as “The Arctic Death Spiral.” My side pointed to the warm Atlantic Multi Decadol Oscillation (AMO) as the reason for this, and once it flipped to cold, as it was through the 1980s, sea ice would expand. Please remember that the Pacific has flipped to its colder mode, but only at the very start of this graphic was the Pacific and Atlantic in their cold modes together. So the start of the measurement here was at the height of what was the best set up for the expansion of Arctic sea ice.
Again, as long as the Atlantic was in its cold overall mode, sea ice was more or less above normal.
So I made a forecast back in 2007 that the Arctic would return to normal and above once the Atlantic flipped to its cold mode for good, which is around or after 2020. We can already see evidence now. The Atlantic has cooled some. (Even in warm periods, we see ups and downs go on, just like we see El Ninos – like we will this year – in the colder times of the Pacific, but they are short lived overall and preceded and followed by longer periods of cooling.) Look what the forecasted Arctic sea ice anomaly is for the height of the melting season this year now that the Atlantic is a bit cooler.
It’s nowhere near as low as previous years. It’s the summer min. that is what the sea ice death spiral people have been jumping on, yet this minor turn to colder overall – again, we are not ready to shift completely out of the dedadol warm mode – has it near normal for this melt season andincreasing against the anomaly from the level it’s at now!
So what do you think is going to happen when the AMO turns cold overall again?
I am directing this at the vast majority of journalist out there that may not understand there is so much contrary information to the missive that you are constantly bombarded with on man-made global warming. I am not asking you to charge a beach into a hail of machine gun fire and go cut bob-wire in a maze of hedges. Nor do you need to go win three NCAA titles and be undefeated in college. But I think what my Coach Koll said is needed here – “a lick of guts and an ounce of smarts.” I am not insulting you since I believe that is what is in you, since the very nature of this vocational calling means that is a given. But you have to get a little old school, think with your head and pursue with your heart. The truth in this matter, and all it implies for freedom and the ability for untold amounts of people to have a chance at a better life, depends on it. It’s no different than the great “liberal” lights that is shown before you to give you this chance to do what you do.
Sometimes being a “hero” is simply the situation you are in and the ability to fight for the answer. And that takes a lick of guts and an ounce of smarts.
[Originally published at The Patriot Post]
In whatever direction we turn, we find the heavy hand of government intruding into virtually every aspect of American society. Indeed, it has reached the point that it would a lot easier to list those areas of people’s lives into which government does not impose itself – and, alas, it would be a very short list. But it was not always that way.
Around a hundred years ago, say, in the first decade of the 20th century, all levels of government in the United States only taxed away and spent about 8 percent of national income, leaving 92 percent of what individual’s had produced and earned in their own hands to use and spend as they thought best as free people.
Plus, there was no regular deficit spending because the federal government in Washington, D.C. annually balanced its budget; and it often even ran budget surpluses with which it paid down government debts accumulated during past “national emergencies,” usually a war that had earlier needed rapid funding with borrowed money.
Today, all levels of government – federal, state, and local – tax or borrow and, then, spend around 40 percent of the Gross Domestic Product in the United States. And if one adds the financial cost imposed upon the citizenry in the form of economic and social regulations to which businesses and enterprises must conform, the total burden of government is significantly higher.
Government has also influenced the American people in another way: They have lost their understanding of what a free market society was, could, and should be. The growth in the interventionist and redistributive state over the last 100 years has resulted in several generations who have come to think that political paternalism is as normal and “American” as apple pie.The Change in American Economic Policy
This shift in the role of government in American society was noticed by the free market, Austrian economist, Ludwig von Mises, while traveling around the United States on a lecture tour back in 1926. After returning to Austria, he delivered a talk on “Changes in American Economic Policy” at a meeting of the Vienna Industrial Club. He explained:
“The United States has become great and rich under the rule of an economic system that has set no restrictions on the free pursuits of the individual, and has thereby provided the opportunity for the country’s productive powers to be developed. America’s unprecedented economic prosperity is not due to of the richness of the American soil; instead, it is due to an economic policy that has reflected how best to exploit the possibilities offered by the land.
“American economic policy has always rejected–and still rejects today–any protection for inferior or less competitive against that which is efficient and more competitive. The success of this policy has been so great that it is hard to believe that Americans would every have reasons to change it.”
But Mises went on to tell his Viennese audience that new voices were being heard in America, voices that claimed that America’s economic system was not managed “rationally” enough and that it wasn’t “democratic” enough because the voters did not have it in their immediate power to influence the direction of industrial development. Governmental controls were being introduced not to nationalize private enterprise but to direct it through various regulatory methods.
The American economy was certainly far less regulated by government than the countries in Europe, Mises pointed out. However, there were strong trends moving the United States along the same more heavily interventionist path Europe had been traveling for a long time. In the America of 1926, Mises observed, “But today both major parties, the Republicans as well as the Democrats, are ready to undertake every very radical steps in the this direction in order to win the votes of the electorate.” He concluded, There can be no doubt that the results American would achieve from such a policy would be no different than what it has ‘achieved’ in Europe.”
In Europe, the trend towards collectivism in the 1930s and 1940s took some extreme forms. Socialism, communism, fascism and Nazism were all tried on the other side of the Atlantic. They represented a total rejection of a free economy and individual liberty. In America, the collectivist trend never went to such an extreme, though Franklin D. Roosevelt’s first New Deal came very close to the fascist model.Defining the Free Market Economy
Socialism, communism, fascism and Nazism are now all but dead. They failed miserably. But they have been replaced by what is merely another more watered down form of collectivism that may be called “interventionism.” Indeed, interventionism is the predominant economic system in the world today. In 1929, Ludwig von Mises published a collection of essays under the title, “Critique of Interventionism.” He argued,
“All writers on economic policy and nearly all statesmen and party leaders are seeking an ideal system which, in their belief, is neither [purely] capitalistic nor socialistic, is based neither on [unrestricted] private property in the means of production nor on public property. They are searching for a system of private property that is hampered, regulated, and directed through government intervention and other social forces, such as labor unions. We call such an economic policy interventionism, the system itself the hampered market order.”
He added, “All its followers and advocates fully agree that it is the correct policy for the coming decades, yea, even the coming generations. And all agree that interventionism constitutes an economic policy that will prevail in the foreseeable future.”
With the demise of communism in the 1990s, public policy around the world, including in the United States, is back to where it was when Mises wrote these words 85 years ago. Comprehensive government ownership of the means of production and a fully centralized planned economy has very few adherents left, even “on the left.” At the same time, in spite of all the casual rhetoric about the triumph of capitalism, we have not seen much evidence of a movement toward a truly free market system.
Here are eight points that define a genuine free market economy, or what Mises referred to as the “unhampered economy”:
- All means of production are privately owned.
- The use of the means of production is under the control of private owners who may be individuals or corporate entities.
- Consumer demands direct how the means of production – land, labor, and capital – will be used.
- Competitive forces of supply and demand determine the price for consumer goods and the various factors of production including labor.
- The success or failure of individual and corporate enterprises is determined by the profits or losses these enterprises earn, based on their greater or lesser ability to satisfy consumer demands in competition with their rivals in the marketplace.
- The market is not confined to domestic transactions and includes freedom of international trade, investment, and movement of people.
- The monetary system is based on a market-determined commodity (e.g., gold or silver), and the banking system is private and competitive, neither controlled nor regulated by government.
- Government is limited in its activities to the enforcement and protection of individual life, liberty, and honestly acquired property.
Unfortunately, many modern politicians and academics who say they endorse free market capitalism are willing to tolerate a great deal of government intervention.
When it comes to identifying the role of government in their conception of the market order, many if not most “conservative” economists still assume that government must be responsible for a social safety net that includes Social Security, some form of government-provided health care, and unemployment compensation; must have discretionary monetary and fiscal powers to support supposed desired levels of employment and output; must regulate industry to assure “competitive” conditions in the market and “fair” labor conditions for workers; and must directly supply certain goods and services that the market allegedly does not provide.
Indeed, many people who claim to be “on the right” believe that government should institute some or all of these “public policies.” It should be appreciated, however, that the very notion of “public policy,” as the term is almost always used, supports government intervention in the market in ways that are simply inconsistent with a genuine free market economy.
Interventionism as public policy is not consistent with the free market since it intentionally prevents or modifies the outcomes of the market. Here are the eight points of the interventionist economy:
- The private ownership of the means of production is either restricted or abridged by government.
- The full use of the means of production by private owners is prohibited, limited, or regulated by government.
- The users of the means of production are prevented from being guided by consumer demand through a network of government regulations, controls, prohibitions and restrictions.
- Government influences or controls the formation of prices for consumer goods and/or the factors of production, through such interventions as price supports, subsidies, or minimum wage laws.
- Government reduces the impact of market supply and demand on the success or failure of various enterprises while increasing the impact of its own influence and control through such artificial means as price and production regulations, limits on freedom of entry into segments of the market, and direct or indirect subsidies.
- Free entry into the domestic market by potential foreign rivals is discouraged or outlawed through import prohibitions, quotas, domestic content requirements, or tariffs, as well as capital controls, and restrictions on freedom of movement.
- The monetary system is regulated by government for the purpose of influencing what is used as money, the value of money, and the rate at which the quantity of money is increased or decreased. And all these are used as tools for trying to affect the levels of employment, output, and growth in the economy.
- Government’s role is not limited to the protection of life, liberty, and property.
It is also important to note that the “public policies” these eight points represent must be implemented through violent means. Only the threat or use of force can make people follow courses of action that are different from the ones that they would have peacefully taken if it were not for government intervention. There is really nothing “public” about these policies, after all; they are coercive policies imposed by government.Free Markets and the “Law of Association”
Contrast these policies with the policies of the free market. What is most striking is the voluntary nature of market arrangements. The means of production are privately owned, and the owners are free to determine how those means of production will be employed. Thus, control over the means of production is depoliticized, that is, outside of the control or influence of the government. Since control is not located in one political place but is dispersed among a wide segment of the society’s population, it is also decentralized.
Individuals, therefore, own and control the means through which they can maintain and improve their own circumstances, and not be dependent upon a single political source for employment or the necessities and luxuries of life. But it is not just the owners of the means of production who have a high degree of autonomy in the free market economy; consumers do, too, since they are the ones who determine what products and services will be in demand.
The basis of society, Ludwig von Mises emphasized, is what he called “the law of association.” Men can more successfully improve their individual condition through cooperation, and the means through which that cooperation can be made most productive is the division of labor. By taking advantage of individual talents and circumstances through specialization, the total quantity and quality of society’s output can be dramatically improved. Individuals do not have to try to satisfy all their own wants through isolated activity.
Once they specialize their activities, they become interdependent; they rely upon each other for the vast majority of goods and services they desire. But it is this very interdependency that gives production its real and true social character. If men are to acquire from others what they desire, they must devote their energies to producing what those others are willing to accept in trade.
The fundamental rule of the market is mutual agreement and voluntary exchange. Each member of society must orient his activities toward serving the wants of at least some of the other members in an unending circle of trade. The Scottish moral philosopher Adam Smith observed over two hundred years ago:
“Man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favor, and show them that it is to their own advantage to do for him what he requires of them. Whosoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this that you want is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices that we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard for their own interest. We address ourselves, not to their humanity, but to their self-love, and never talk to them of our own necessities but of their own advantages.”
This is what assures that the uses for which the means of production are applied are guided by consumer demand. Each individual must find a way to satisfy some of the needs of others before he can successfully satisfy his own. As a result, the prices for consumer goods and the factors of production are not decreed by government but are formed in the marketplace through the competitive forces of supply and demand. Success or failure is determined by the profits and losses earned on the basis of the greater or lesser ability to meet consumer demand in competition with rivals in the marketplace.Abandoning Our Constitution
In 1936, the Swiss economist and political scientist William E. Rappard delivered a lecture in Philadelphia on “The Relation of the Individual to the State” in which he emphasized that no one could read the accounts of the constitutional debates of 1787 or the famous “Federalist Papers” without realizing that the Founders were “essentially animated by the desire to free the individual from the state.” He even went on to say, “I do not think that anyone who has seriously studied the origin of the Constitution of the United States will deny that it is an essentially individualistic document, inspired by the suspicion that the state is always, or always tends to be, dictatorial.”
Reflecting upon the trends he observed in the United States in the New Deal era of the 1930s, Professor Rappard concluded: “The individual demanding that the state provide him with every security has thereby jeopardized his possession of that freedom for which his ancestors fought and bled.”
Is Soviet-style communist central planning now in the ash heap of history? Yes. Are masses of people in the West willing to walk in blind, lockstep obedience to fascist demagogues in torchlight parades? No. And hopefully neither form of totalitarianism will ever again cast its dark collectivist shadow over the West. However, nearly 80 years after Professor Rappard’s observations about statist trends in America and around the world, Western democracies are still enveloped in the tight grip of the interventionist state.
Private property increasingly exists only on paper. And with the abridgment of property rights has come the abridgment of all the other individual liberties upon which a free society is based. Our lives are supervised, regulated, controlled, directed and overseen by the state. Look at any part of our economic and social lives and try to find even one corner that is free from some form of direct or indirect government intrusion. It is practically impossible to find such a corner.
This is because our lives are not our own anymore. They are the property of the state. We are the tools and the victims of public policies that are intended to construct brave new worlds concocted by intellectual and political elites who still dream the utopian dream that they know better than us how our lives should be lived.
Today, it is not free market forces but political directives that most often influence what goods and services are produced, where and how they are produced, and for what purposes they may be used. If we pick up any product in any store anywhere in the United States we will discover that hundreds of federal and state regulations have actually determined the methods by which it has been manufactured, its quality and content, its packaging and terms of sale, and the conditions under which it may be “safely” used by the purchaser. If we buy a tract of land or a building, we will be trapped in a spider’s web of land-use, building code and environmental regulatory restrictions on how we may use, improve, or sell it. Every facet of our lives is now subject to the whims of the state.Economics, Morality, and the Law
In an environment in which “public policy” determines individual lives and fortunes and in which social and economic life has become politicized, it is not surprising that many Americans have turned their attention to politics to improve their market position and relative income share. Legalized coercion has become the method by which they get ahead in life.
And make no mistake about it: Every income transfer, every tariff or import quota, every business subsidy, every regulation or prohibition on who may compete or how a product may be produced and marketed, and every restraint on the use and transfer of property is an act of coercion. Political force is interjected into what would otherwise be a system of peaceful and voluntary transactions.
Over time, interventionism blurs the distinction between what is moral and what is not. In ordinary life, most people take for granted that certain forms of conduct are permissible while others are not. These are the Golden Rules we live by. Government’s task in human society is to enforce and protect these rules, which are summarized in two basic principles: Neither force nor fraud shall be practiced in dealings with others; and the rights and property of others must be respected. In the moral order that is the free market economy, these principles are the wellspring of honesty and trust. Without them, America is threatened with ultimate ruin – with a war of all-against-all in the pursuit of plunder.
When individuals began to ask government to do things for them, rather than merely to secure their individual rights and honestly acquired property, they began asking government to violate other’s rights and property for their benefit.
These demands on government have been rationalized by intellectuals and social engineers who have persuaded people that what they wanted but didn’t have was due to the greed, exploitation, and immorality of others. Basic morality and justice has been transcended in the political arena in order to take from the “haves” and give to the “have not’s.” Theft through political means has become the basis of a “higher” morality: “social justice,” which is supposed to remedy the alleged injustices of the free market economy.
But once the market becomes politicized in this manner, morality begins to disintegrate. Increasingly, the only way to survive in society is to resort to the same types of political methods for gain as others are using, or to devise ways to evade the controls and regulations. More and more people, therefore, have been drawn into the arena of political intrigue and manipulation or violation of the law for economic gain. Human relationships and the political process have become increasingly corrupted.
In the 1920s, Ludwig von Mises explained a crucial aspect of this corruption of morality and law:
“By constantly violating criminal laws and moral decrees [people] lose the ability to distinguish between right and wrong, good and bad. The merchant, who began by violating foreign exchange controls, import and export restrictions, price ceilings, etc., easily proceeds to defraud his partners. The decay of business morals . . . is the inevitable concomitant of the regulations imposed on trade.”
Mises was, of course, repeating the lesson that the French classical economist Frederic Bastiat had attempted to teach in the 1850s in his famous essay, “The Law.” When the state becomes the violator of liberty and property rather than its guarantor, it debases respect for all law. People in society develop an increasing disrespect and disregard for what the law demands. They view the law as the agent for immorality in the form of legalized plunder for the benefit of some at the expense of others. And this same disrespect and disregard sooner or later starts to creep into the ordinary dealings between individuals. Society verges on the brink of lawlessness.Trends Can Change – With the Will to Make It Happen
Bastiat predicted the moral bankruptcy that has been brought on by the interventionist state. But are we condemned to continue in a state of moral and political corruption?
Many thoughtful observers shake their heads and conclude that the answer is, “Yes.” But it is worth recalling that in 1951 Ludwig von Mises wrote an essay called “Trends Can Change.” He was replying to those who despaired at that time that socialist central planning was increasingly dominating the world. The situation seemed irreversible; political, economic, and social trends all seemed to be heading in the direction of comprehensive collectivism. Said Mises:
“One of the cherished dogmas implied in contemporary fashionable doctrines is the belief that tendencies of social evolution as manifested in the recent past will prevail in the future, too. Any attempt to reverse or even to stop a trend is doomed to failure . . .
“The prestige of this myth is so enormous that it quells any opposition. It spreads defeatism among those who do not share the opinion that everything which comes later is better than what preceded, and are fully aware of the disastrous effects of all-round planning, i.e., totalitarian socialism. They, too, meekly submit to what the pseudo-scholars tell them is inevitable.
“It is this mentality of passively accepting defeat that has made socialism triumph in many European countries and may very soon make it conquer in this country [the United States] too . . .
“Now trends of evolution can change, and hitherto they almost always have changed. But they changed only because they met firm opposition. What [Hilaire] Belloc called the servile state will certainly not be reversed if nobody has the courage to attack its underlying dogmas.”
The trend towards totalitarian socialism was reversed. It was reversed by its own inherent unworkability. It was reversed by the faith of millions of people in the Soviet bloc who would not give up on the dream of freedom and by a courageous few who sacrificed their careers, their property, and even their lives to make that dream a reality. And it was reversed by friends of freedom in the West who helped prevent its triumph in their own homelands and who provided an intellectual defense of liberty and the free market.
Interventionism in America in these early decades of the 21st century is a trend that can also be reversed. Its own inherent unworkability and strangulation of the wealth-creating mechanisms of the market will start the reversal process. But that is not enough. We must rekindle our belief in and desire for freedom. And some of us have to speak out and refute the rationales for interventionism.
We need to share with our fellow citizens a powerful vision of the free society and the unhampered economy. If we succeed, the trend of the 21st century can be a trend toward greater individual freedom, an expanding global free marketplace, and rising standards of living and opportunity for all.
[Originally published at EpicTimes]
Despite its deep effects on the character of our nation, conservatives and the general population often ignore what children are learning except when their own are in school, so I thank everyone reading this debate and my worthy, tenacious opponent, Mike Petrilli, for your time and attention. National Common Core testing and curriculum mandates are destructive, overall, but one good side-effect is creating the opportunity to discuss what children will learn, and why.
Opinion polls continue to show that the general public is ill-informed not just about education policy, but about Common Core particularly. The latest I’m aware of, from Tennessee, finds that 58 percent of adults don’t know what Common Core is. That’s rather astonishing considering that Common Core will ultimately influence almost everything about pre-K through higher education in this country except sundry administrative affairs like bus schedules and lunch menus.
In short, Common Core is a set of central mandates called standards that set what children will be tested on in English and math in grades K-12. Forty-five states have decided to reorient their curriculum and teacher training and evaluations around these mandates, in large part because of demands by the Obama administration. The Obama administration, notwithstandingthree federal laws against federal interference with curriculum and testing, is currently the exclusive funder and evaluator of national tests to enforce Common Core that will roll out this coming school year.
Widespread ignorance of this initiative despite its massive effects is a feature, not a bug, of the process that created it. Proponents like to insist Common Core originated in a “state-led” process, but the truth is that a group of private trade organizationscommissioned a small group of consultants to write Common Core behind closed doors. There is no legal authority in this country for elected leaders to gather together and write policies except in the halls of Congress. But Americans do not like Congress getting too involved in education, a sensible sentiment given that our Constitution reserves that right to the states under the Tenth Amendment, so those who want a centralized education system in this country decided to go through nonprofit organizations, conveniently circumventing open records and open meetings laws that apply to public bodies such as state boards of education and legislatures. To this day, we have no idea what the people who wrote Common Core were paid and by whom, who called what shots and why, the negotiations that took place, and more extremely pertinent information.
Before this group published Common Core’s final version in June 2010, the Obama administration came into office. Congress, in its wisdom, had already granted it a bajillion-dollar slush fund called 2009’s “stimulus package,” and $4.35 million of that became a U.S. Department of Education slush fund that the administration used to push states into adopting its policy priorities during a panicky recession. It created a set of competitive grants that awarded extra points to states that adopted Common Core and its tests, which were then (and still for the tests) sight unseen. Common Core was actually published on June 2, 2010, but the Obama administration’s deadlines to sign onto it to get priority for these funds were January 19, 2010 and June 1, 2010. A draft of Common Core was not even available until March 2010, after approximately a third of states had already promised the federal government they would switch over to it. Thirty-seven business days after Common Core was released, and with little fanfare, a majority of states had jumped into this massive, experimental shift for their education systems. In his 2013 State of the Union address, President Obama rightfully claimed his administration had “convinced almost every state” to adopt Common Core through stimulus grants. To this day, only a handful has even sketched out what this will cost taxpayers financially, and none have demanded hard data on whether it will be effective at improving education (good thing, because none exists, and in factstudies tend to say standards are a waste of time entirely).It is not surprising that this pell-mell, elite-driven, closed-doors process created a set of what can only accurately be described as mediocre mandates.
It is not surprising that this pell-mell, elite-driven, closed-doors process created a set of what can only accurately be described as mediocre mandates. Again, the PR line says that Common Core is “internationally benchmarked” and “rigorous,” but evaluations done both by organizations with financial reasons to favor Common Core, such as Petrilli’s Fordham Institute, and by independent scholarsconclude that not only will Common Core graduate students prepared at best for a two-year community college (no normal person’s definition of “internationally competitive”), several states already had better standards. Despite this, Petrilli continues to insist that because Common Core is a step up for some states, we should refrain from insisting that all children should get the best we know is available and not mind that these best states dumbed down their academic offerings when they accepted Common Core. I and many parents find that utterly unacceptable.
The grassroots furor over Common Core—which has led to 37 states considering withdrawals or amendments—is not from moms and dads who want their kids to skate through school, as U.S. Education Secretary Arne Duncan implied a few months back. These parents want more, and better for their kids than “a step in the right direction.” I wager that 90 percent of the debate over Common Core would instantly dissipate if states adopted the top-rated standards from, say, Massachusetts or Indiana and dropped the Obama administration tests. Children right now in third and fourth grade do not have a second chance to learn what they need ten years down the road when we finally figure out that Common Core didn’t give it to them.
There are many other concerns with Common Core, such as the extent to which its tests grant direct federal access to kids’ personal information and will micromanage teachers through new test-driven evaluations. As I said in the beginning, Common Core touches almost everything. But if I must pick the biggest concerns, for me they are the lack of academic quality and the technocratic central planning Common Core demands. It is our American birthright to have a voice in the policies that govern our lives and our futures, and for various governments and entities to be restrained from controlling what rightfully belongs to parents and local communities. Common Core has traded that birthright for a mess of pottage.Opening Statement – Mike Petrilli
It’s not lost on me that I’m one of the most prominent conservatives still publicly supporting the Common Core State Standards (“tenaciously,” according to Joy—a compliment I’ll take!). Nor am I surprised that so many on the right instinctively distrust the effort—for reasons of history both ancient and recent. The left has been foisting ill-conceived ideas on the nation’s schools pretty much forever, ranging from the silly (the self-esteem movement) to the ridiculous (ebonics) to the truly harmful (“rain forest math”). And in terms of recent history, we are living through the impact of the left’s centralizing, micro-managing, nanny state machinations on all manner of policies, ObamaCare especially. Common Core appears to fit this narrative all too well.
Yet, over the course of this dialogue, I’ll argue that the ObamaCare analogy is far from perfect. While there has been a small federal role—one magnified by President Obama’s credit-taking and Secretary of Education Arne Duncan’s name-calling—this is hardly a federal project. It was started by the states, and its future rests in the hands of the states. Furthermore, in many respects, Common Core is a conservative triumph, as the vast majority of states have moved from vague, low-level, and often leftish academic standards to challenging, straightforward, no-nonsense ones. As Republican speechwriter Michael Gerson argued last year, “Localism is an important conservative principle, but so is excellence.”
But are the standards excellent? Here I look forward to a vigorous debate with Joy, who has been one of the fiercest, yet fairest, critics of the Common Core. In a recent piece for School Reform News, she not only had nice things to say about me (again, I’ll take it!) but also took a strong stand against one of the most dishonest tactics of some Common Core opponents: Equating every bad lesson plan or textbook with the new standards, regardless of how tenuous the link. It’s an easy and effective parlor trick, and I appreciate and respect Joy’s integrity in choosing not to deploy it.
So I look forward to diving into issues of federalism, and the content of the standards, as our dialogue unfolds. But first let me restate why the country is so in need of higher standards and tougher tests in the first place—and why the nation’s governors and state superintendents agreed to work on common standards way back when Barack Obama was just the junior senator from Illinois.
The case for college and career-ready standards:
We all know that there’s a lot of testing in our schools today. And while nobody loves testing (or “central mandates,” in Joy’s parlance), it’s important to know that the advent of standards, testing, and accountability—driven mostly by conservatives—has been associated with big gains in achievement for our lowest performing students. Nationally, or lowest performing students, our lowest-income students, and our minority students are achieving one to two grade levels ahead of where their peers were in the mid-1990s.The bad news is that it’s come with many unintended consequences—the narrowing of the curriculum, an obsession in some schools on test prep, and a lack of focus on students at the middle or at the top.
That’s the good news. The bad news is that it’s come with many unintended consequences—the narrowing of the curriculum, an obsession in some schools on test prep, and a lack of focus on students at the middle or at the top. And as a result, while we’ve made huge gains for the kids at the bottom, we’ve made smaller gains for everyone else.
It’s not hard to understand why. Most states set their standards, and especially their tests, at ridiculously low levels. And the No Child Left Behind Act put pressure on schools to get all students over that very low bar. So all of the attention went to the students below that bar—the lowest performing kids. And they made gains. Important, historic gains worth celebrating.
But there were no incentives for schools to focus on kids at the middle, or at the top.
That’s created a really big problem. Think of it from a student’s perspective. They march through the public education system, they pass the state tests every year, they pass their courses (often with honors grades), and they earn a high school diploma. But because the standards have been set too low, passing the tests, and earning a diploma, doesn’t actually mean they are ready for what comes next.
So they get to college, and enroll, and take out student loans. And then are told, “I’m sorry, you’re not actually ready for college. You have to take one, two, maybe three math classes, or one, two, three writing classes, before you can even start earning credits.” Before they can even get to the starting line.
And you can imagine how angry these young people would be. And deserve to be. “I did everything you told me to do. I passed all the exams. I passed all of my courses. I earned a diploma.” And most drop out—before ever getting past remedial education.
Because we set the standards too low—because we didn’t align the expectations of the public education system with the demands of the real world—we sent false signals for years that all was well, when in fact many students were not on track for success. We lied to kids, and to their families, and to the taxpayers.
Or imagine if a high school graduate goes straight into a workforce. They show up for a “middle skill” job, one that demands a decent wage. And again, the employer says, “I’d like to hire you, but you don’t have the math or reading or writing or critical thinking skills we need.”
This was the problem that the nation’s governors and state superintendents were trying to tackle when they came together back in 2007 and 2008 to talk about developing common, rigorous standards for English and math. Could they, working jointly, and with support from the philanthropic sector, come up with common, high standards in these basic subjects, and provide the political cover to one another to set the bar where the real world standard really is? Could together they find the political courage to start telling the truth—that in fact our public education system is only preparing about one-third of our graduates for success in college or career, and that we need to do much better? And could raising the bar help us get the kind of progress for kids at the middle and at the top that we’ve seen for kids at the bottom of the performance spectrum?
The result was the Common Core, which, as I’ll argue, is significantly stronger than what three-quarters of the states had in place before, and on par with the rest. Standards which were adopted by state boards of education after public hearings and votes—the standard operating procedure for, well, standards.
Even Joy will acknowledge that today’s system is a “mess of pottage.” Standards that are too low, tests that are too easy, students who aren’t prepared for what comes next. And while I would applaud any state that wants to adopt other college-and-career ready standards that aren’t the Common Core—she mentions those previously in place in Indiana and Massachusetts—Joy should admit that there’s no clear path forward for states wanting to do just that. Indiana is trying, as we speak, to develop new standards under the direction of its legislature. But its Department of Education managed to draft standards that are worse than the very good Common Core expectations and worse than Indiana’s old standards, even though these two sets of standards are quite similar (and similarly good). Meanwhile Indiana’s teachers have been trained on the Common Core and have started preparing for the Common Core tests. Would you like to explain to them why the Hoosier State is going to throw a wrench into all of their efforts? Because of what, politics?
Joy and I, like most conservatives, agree on many fundamentals about education reform: Expanded parental choice is essential; Teachers must be held accountable for raising achievement; Unions are a huge problem. But when it comes to higher standards we will have to agree to disagree, because I for one view them as an indispensable weapon in the war on ignorance and hopelessness.
Let the debate begin!Response #1: Joy
First, thanks to Mike for his gentlemanly opening words. He’s certainly right about one big thing: public officials have been deceiving taxpayers and kids about the quality of the education they’re dishing up. But I think Common Core is just another version of this deception, dressed up in shinier clothes.
What makes it possible for schools to continue giving kids diplomas that are not worth the fake parchment they’re printed on? When our pediatrician kept not having the vaccines we needed, making us wait for 45 minutes with a naked, squalling baby, and charging us more than our friends’ charged, I switched pediatricians. People with unsatisfactory doctors and plumbers and mechanics tell everybody and find a new service provider.
But public schools are largely insulated from the consequences of their failure. If a school doesn’t teach a kid how to read, the kid loses out, not the school. That’s because most public schools have a captive market. They get students—and therefore public money—whether they teach those kids anything or not. That worked alright back when there was a cultural consensus over what kids would learn, and schools had more effective local accountability because they were locally controlled, and teachers didn’t have to co-parent because moms and dads stayed married and usually one was home to bring up the kids full time. But once all these things disintegrated and were replaced by more and more centralized, monopoly-creating mandates (such as that teachers must all be trained by one type of institution and those started to de-emphasize the knowledge teachers needed to help kids succeed because teachers colleges didn’t lose students for turning out poor ones), schools degraded.
Mike’s Fordham Institute has memorialized the day America realized this degradation with President Reagan’s A Nation at Risk report. But instead of realizing that central planning was a central problem, business and political leaders decided that more central planning was the answer! That’s when, in the late 80s and early 90s, they began pushing education “standards” and tests. (I put “standards” in scare quotes because they have never really deserved the name, which I’ll talk about in a second.) Standards—or, really, curriculum mandates, which is what I will continue to call them—promised conservatives the ability to impose their ideas of what kids should learn on those unruly, leftist teacher colleges. Unfortunately, those teacher colleges trained the “experts” who wrote the standards, and liberals naturally demanded a seat at the table for teachers unions and other establishment “stakeholders,” creating the very sort of bureaucratic committee which can never issue a quality product because the only thing that pleases everyone is a pile of pablum, at best (which is, by the way, why textbooks so uniformly suck).
Of course, the federal government never saw an education idea it didn’t want its sticky fingers on despite its lack of legal authority to touch education, so we had Congress offering states money for “voluntarily” adopting these curriculum mandates. When that didn’t work, 2001’s No Child Left Behind decided more central planning was order, and made everyone adopt “standards” which they would lose money for not meeting. Not surprisingly, states set standards a syphilitic ant could reach.
Again, rather than realizing federal mandates had created this problem, authoritarians of all political flavors decided federal mandates would solve it. (And Mike can’t pretend Common Core started “state-led” when the people running the thing from the beginning begged for federal funds and mandates before President Obama took office and happily obliged.) Then we had déjà vu all over again, with essentially the same process. And here we are, with school instruction about to be essentially nationalized through federal tests.Even if we concede that central mandates are a good way to run education, these central mandates are not good ones.
Even if we concede that central mandates are a good way to run education, these central mandates are not good ones. Here’s where the false promise of Common Core becomes apparent. Even if we concede that central mandates are a good way to run education, these central mandates are not good ones. A notable number of experts have either declared or conceded that a curriculum built around Common Core itself will not prepare students for the very things they keep telling us it will, like college. It will get kids ready for a two-year community college, Common Core lead writer Jason Zimba told the Massachusetts Department of Education (which has been confirmed by audio recording despite Zimba’s protestations on Fordham’s blog).
Maybe that’s what business front groups mean when pretending that Common Core is “internationally benchmarked” and will make us “internationally competitive,” but I don’t think so. Considering that our international competitors introduce more advanced math concepts several years earlier than Common Core, for just one example of its overall mediocrity, it sounds like they’re uncritically accepting deceptive talking points. Further, notice that Mike doesn’t respond, really, when I say that parents righteously want the best for their kids, and it’s cheating them to pretend that forcing them to take “good enough” is a big victory we should celebrate.
The standards themselves read like the product of any bureaucratic mind-meld. Try some of it on for size. Reading standard RF.K.3B says “Associate the long and short sounds with the common spellings (graphemes) for the five major vowels.” That sounds really impressive, until someone who knows better analyzes it, as Dr. Terrence Moore has this one. Let me quote him:
Presumably the authors of the standard are telling teachers to teach children the long and short sounds of the vowels. But that is not what it says. Rather, students are supposed to associate (know?) the long and short sounds when they see “the common spellings . . . for the five major vowels.” What?
Now ask yourself: How many ways are there to spell the letter A? I can only think of one, unless you mean to distinguish between capitals and lower case, which is not what is being said. A is always spelled A. Even if we give the original authors of this standard and the Indiana committee the benefit of the doubt, and allow them to claim that learning the vowel sounds was what they meant, we still have the problem of the more generous reading of the standard not being true, either, or at best only half true. Why learn only the short and long sounds? Every vowel except for e has more than a long and a short sound. The letter A, for example, has four sounds: /ă/, /ā/, /ah/, /aw/, as in at, tape, want, talk. Consider the word father. You do not call your father your făther, nor your fāther. Yet this simple truth about the code that is the English alphabet is lost on the very people who are in charge of writing “standards” for our children’s schools.
The answer to the destructive unintended consequences of central planning is not more central planning and mandates on ordinary folks from elitist bureaucrats who will never meet their test subjects. It is to realize that central planning disempowers average folks and advantages the well-connected, and in the process destroys quality. Time to try something else: Set people free to choose a different kind of school when their current one will not educate their child.Response #1: Mike
Now we’re getting somewhere! Joy does this debate a great service by acknowledging what this is really about. Fundamentally it’s not that she disagrees with the specifics of what’s in the Common Core, or how they came to be (though it’s obvious that she’s not a fan of some of the details, or the process). She equates the standards-and-accountability movement writ large with central planning. Joy doesn’t want the public schools accountable to anyone except for parents.
That’s a legitimate, libertarian position, but one at odds with decades of conservative thought, Republican policy, and, in my view, common sense. The problem isn’t her advocacy for parental choice–we are in agreement about that. The question is whether the best policy is “choice alone” or “choice plus accountability for results.” It’s not a close call.Opening these schools to competition via vouchers, charter schools, or scholarship tax credits should absolutely be a part of the equation.
For sure, Joy is right that “schools are largely insulated from the consequences of their failure” because “most public schools have a captive market.” Opening these schools to competition via vouchers, charter schools, or scholarship tax credits should absolutely be a part of the equation.
But it’s not the entire equation. Consider this: Education is a private good (we want our own children to have access to great schools) but also a public good (we’re all better off with a well-educated citizenry–that’s why we subsidize education with tax dollars). School choice is essential for satisfying the demands of parents (the private good) but some sort of external accountability is essential for satisfying the demands of taxpayers (the public good).
Now, proponents of school choice will argue that parents will exercise greater quality control over the schools than public bodies will; I generally agree. At a macro-level, choice and competition will lift all boats by making schools more responsive to families. It will also create a system which will be less antagonistic to parents’ values and aspirations for their children–an important feature.
But will school choice alone lead to better student achievement results than choice plus accountability? I see no evidence for that proposition. In fact, the lesson from twenty years of charter schooling is that states that have stressed quality and results get better outcomes than those that have embraced a laissez-faire system. The hard truth is that some parents will settle for crummy schools–but they will gravitate toward stronger schools if those are the ones allowed to open and grow.
Of course, the notion that policymakers are choosing between “universal school choice” and “standards based reform” is a false dichotomy. Not only could these two strategies co-exist, virtually nowhere are we close to the school choice marketplace that Joy envisions. (New Orleans, with nearly 100 percent of its schools in charters, is closest–and it embraces accountability for results!) About five percent of the nation’s students are in charter schools; far less than one percent are attending private schools with public support. For the foreseeable future–when the vast majority of children will attend schools that face little or no competition–we need a strategy for quality control for the system as a whole.
Maybe Joy disagrees. May she is willing to trust upwards of 50 million schoolchildren to the whims of local school boards (themselves often captives of local teacher unions); the dictates of state and federal bureaucrats; and the latest brainstorms of ed school professors. For that’s what “quality control” looks like in the absence of standards, testing, and accountability.
Standards-based reform isn’t an act of “central planning.” Done right–and the Common Core authors did it right–it’s about identifying the standard that already exists in the real world: What students need to know and be able to do to succeed in college or get a decent paying job. And then figuring out where students need to be, grade-by-grade, to be on track for that success.
And next time I’ll explain that while the Common Core might not have gotten everything exactly right, it’s dramatically better than what almost every state had in place before. Which is why dumping the Common Core–the path that Joy advocates–won’t return us to some educational shangri-la, but will perpetuate the mediocrity that is the unfortunate hallmark of the American public education system.Response #2: Joy
I’m not sure where Mike is getting this idea that I do not oppose the content of Common Core. I have written and testified extensively about its anti-American, low-grade, empty-skills heap of disconnected edujargon, in publications he reads and hearings he’s attended. So either he’s not listening, projecting an unfitting image of his evil libertarian archnemesis onto me, attempting to avoid a debate on the merits of the curriculum Common Core demands, or deliberately caricaturing my position. I’m actually not a libertarian, and I have never said I want public schools accountable only to parents (although I would not object to that system). I think schools shouldprimarily be accountable to parents. But what does “accountability” mean?Accountability has too often been a weasel word for “central planning,” like “affordable healthcare” is a weasel phrase for “Obamacare.”
It’s my view—and, as researchers have pointed out, this is supported by the best evidence—that choice is accountability. Accountability has too often been a weasel word for “central planning,” like “affordable healthcare” is a weasel phrase for “Obamacare.” Real accountability means that people who make decisions bear the consequences of those decisions. In central planning, that never happens. The people who write education standards—whoever these shadow bureaucrats are and about whom with Common Core we cannot even get an account of who did what and why, how they were selected, and what they were paid—do not have to live with the consequences if they fail to write good ones, or if good ones don’t matter because even “good” central dictates can’t pull the puppet strings hard enough from a thousand miles away. Children and society do.
And Mike can attempt to marginalize me and other thinking people all he wants by pretending that Republican education policies over the past fifty years have been the best thing since sliced bread, but we all know that Republicans often join Democrats in feeding the big-government beast, and after three of Mike’s glorious “decades of conservative thought” 58 percent of fourth graders in this country still can barely read. That’s where “accountability” has got us, and we have Mr. Petrilli touting a slight increase in test scores over twenty years as a huge victory, and a reason to trust and even celebrate this testing dictatorship.
But this discussion, like Common Core, is a red herring to avoid talking about its low quality and the lack of proof it will live up to the outrageous sales pitches we now hear from governors, carefully selected teacher-spokespeople, and chambers of commerce. States, lawmakers, teachers, schools parents, and pundits are now spending enormous time and money debating and implementing Common Core, even though the evidence it will do a whit of good for children is sickeningly absent. Three citations. When Seton Hall University professor Christopher Tienken reviewed the purportedly “large and growing body of knowledge” that supposedly grounds Common Core, he said “I found that it was not large, and in fact built mostly on one report, Benchmarking for Success, created by the [private organizations that created Common Core]… Only four of the cited pieces of evidence could be considered empirical studies related directly to the topic of national standards and student achievement.” Or, as Dr. Jay Greene of the University of Arkansas explains: “The only evidence in support of Common Core consists of projects funded directly or indirectly by the Gates Foundation in which panels of selected experts are asked to offer their opinion on the quality of Common Core standards. Not surprisingly, panels organized by the backers of Common Core believe that Common Core is good… The few independent evaluations of Common Core that exist suggest that its standards are mediocre and represent little change from what most states already have.” Further, research by the Brookings Institutionhas found that standards have essentially no effect on student achievement.
And what all these people with all this time and money are NOT doing, instead, is working to accelerate proven reforms like school choice and real curriculum improvement. They’re not opening new, better schools and closing bad old ones. They’re not tutoring neighbors who never learned to read very well because traditional schools lose nothing for failing to use proven methods to educate kids. They’re not tearing down the teacher certification monopoly that indoctrinates our nation’s molders of young minds with ineffective progressive pedagogy. They’re not reading as many books to their little children, not reading classic literature themselves or investigating and wondering at our glorious world. And that is the hidden shame of Common Core, this vast exercise in unexamined groupthink: Because governments and bureaucrats chained everyone to this brain treadmill, we must spend a sickening number of hours explaining why we should instead be left in peace and freedom.
If you will excuse me, there are two toddlers in my room looking for attention, so I’m going to now go practice what I’m preaching.Response #2: Mike
This exchange has reminded me why I so enjoy Joy’s writing and how lucky we are that she’s working in the school reform movement. We agree on 90 percent of the issues; but alas, back to the 10 percent where we disagree.
I certainly didn’t mean to mischaracterize Joy’s position, though I’m still confused whether she’s for standards-based reform. She says she is, but she also refers to it as a “testing dictatorship,” says we parents should be “left in peace and freedom,” and links to an NRO piece arguing for school choice alone. So I remain somewhat confused. (I continue to believe that choice plus accountability for results is a powerful combo.)
I’m also still confused about whether she thinks the content of the standards are worth fighting over. As she often does, in the course of this debate she linked to Tom Loveless’s research showing the lack of a relationship between the quality of states’ standards and their performance on the NAEP. If standards don’t matter, why all of the fuss? I too wish we could be focused on “accelerating proven reforms.” That’s what was going on circa 2012 in places like Indiana (ahem, remember Tony Bennett?) before the Common Core opponents declared a Holy War. Educators were working on improving their teaching and updating their curricular materials. Indiana was pushing ahead with vouchers and charter schools. Yet it was Joy and her comrades in arms that picked this fight. They decided that the process leading to the Common Core (which was much different than she describes) and the content of the Common Core were so odious as to justify tearing the school reform movement—and the Republican Party—apart.
So let’s talk about the content of the standards. (Though readers, you can judge them for yourselves.) Those of us at the Fordham Institute do believe that the quality of standards matters, though of course (as we’ve said forever, thank you Tom Loveless) well-crafted standards are necessary but insufficient. Standards alone are just words on paper. It’s not surprising that states with stronger standards in the pre-Common Core era didn’t necessarily perform better on national tests of student achievement. It would be like thinking that developing countries that adopt better constitutions would automatically have better functioning governments or economies. Constitutions, like standards, can lay a strong or weak foundation, but their success will depend on many other factors.
In the world of school reform, the most important complement to good standards is an aligned, challenging assessment. In other words, a really good test. After all, we know that in today’s high-accountability education system, teachers feel pressure to teach to the test. If that’s a test worth teaching to—like an Advanced Placement exam—then this pressure can be healthy, as it encourages excellent teaching in the classroom. But if it’s a low-level, fill in the blank exam, then any benefits of high, well-written standards are washed away, as the test becomes the de facto standard. That’s what happened in virtually every state before the Common Core, with the possible exception of Massachusetts. (The Bay State had good standards and a good test.) It explains why a state like Indiana had good standards for a decade but very little improvement on the NAEP.
But back to the standards. In 2010, we studied the content of the Common Core and compared it to the standards of the fifty states. We found the Common Core to be better than what three-quarters of the states had previously and on par with the rest. Three states had somewhat stronger standards in English (receiving A’s from our reviewers versus the Common Core’s B-plus). The primary reason: They included a list of exemplary texts or authors. (The Common Core made its list an appendix—for obvious and understandable reasons.) I simply disagree with Joy that some states “dumbed down their academic offerings when they accepted Common Core.” Almost every state significantly upgraded their academic standards with the Common Core, and a handful traded one good set of standards for another.What makes the Common Core standards so strong? The English standards are solid on phonics and ask schools to bring back rigorous content in history, science, art, music, and literature.
What makes the Common Core standards so strong? The English standards are solid on phonics and ask schools to bring back rigorous content in history, science, art, music, and literature. That’s why E.D. Hirsch, founder of the Core Knowledge program and author of Cultural Literacy, is soencouraged by them. They expect that students read great works of literature and solid non-fiction sources too, like the nation’s founding documents.
The math standards are incredibly solid on arithmetic, expecting students to know their math facts cold, to memorize their multiplication tables, to use standard algorithms, and not to use calculators until they are older. This was a major reversal from most state math standards, too many of which were infected with the “fuzzy math” that Core opponents rightly decry—but which the Core itself does not embrace.
And what about the contention that the math standards will “only” prepare students for entry-level math in community colleges? First, keep in mind that even James Milgram has admitted that the Common Core math standards are tougher than what “90 percent” of the states had in place before. So if that’s true for the Core, it’s doubly true for what preceded it. Second, remember that the advertised purpose of the Common Core is to prepare students for college and career. College is defined as entry level math in a public four year university, or community college courses whose credits can transfer. So critics are right that the Common Core math is not enough for students who plan to attend selective colleges or major in STEM fields. The standards admit as much! The standards are a floor, not a ceiling. But the standards do a very good job preparing young people for advanced math, by giving them a much steadier foundation than what they are getting today. One reason so many students flunk the Advanced Placement calculus exam is that our schools failed to give them a strong foundation.
Still, if states are worried that schools will misread the Common Core as encouraging them to move away from advanced math, they can add standards in calculus as Florida has. Problem solved.
So where do we go from here? If Joy and others on the right still believe in standards-based reform—still believe in the power of setting high standards and holding schools accountable for helping their students reach them—then we need to do a serious cost-benefit analysis. Should we stick with the path we’re on? With standards that aren’t perfect, but are pretty darn good? Or should we plunge our states into total chaos, as is the best way to describe Indiana today? Where educators don’t know what they are expected to teach; where all indications are that the state’s “new” standards will look almost exactly like the Common Core; where the state is going to spend tons of extra money developing its own test, one that is unlikely to be any better than the low-level test is has now? Remind me again why that is a good idea?
Sometimes such disruption is worth it. Repealing ObamaCare would be messy but healthy, as that is a Rube Goldberg machine that’s fundamentally flawed. That’s not the case with Common Core. Disruption in the cause of ideology isn’t smart, and it isn’t conservative.
[Originally published at The Federalist]
The Australian edition of The Guardian — probably the most hard-left of the lefty daily newspapers in the English-speaking world — published a story Thursday about how Attorney General George Brandis stood up for skeptics of the theory of man-caused, catastrophic global warming.
Brandis is not a skeptic himself. He believes in man-caused, catastrophic global warming, but he also believes in liberty. So he gave a “passionate” speech in which he said it was “deplorable” that skeptics are being excluded from the climate change debate. People who say the “science is settled,” Brandis said, are “ignorant” and “medieval.” He did all but call the climate alarmists in Australia’s government fascists.
Good stuff. And good for him, no matter his motivations — painted, of course, in the worst possible and distorted light by the leftist Guardian.
The comments under the story were heavy on the “science is settled” point. So, against my best judgment, I left the following comment:
The climate is always changing. But is human activity causing runaway global warming? Is man causing a climate crisis? On those questions the science is not settled.
Pretty innocuous, right? It was removed 10 minutes later for not adhering to The Guardian’s community standards. Fascists! … who prove Brandis’ point.
Just before learning my comment was taken down, a gentleman added to the conversation by writing:
You’re embarrassing yourself.
So, in four minutes you’ve already read the reports (or at least the summaries)! Fantastic. So I look forward to you rebuttals to the following points:
* Research published in peer-reviewed science journals indicates the model-derived temperature sensitivity of Earth accepted by the IPCC is too large. And how negative feedbacks in the climate system reduce that sensitivity to values an order of magnitude smaller.
* Strong empirical correlations have been reported from all around the world between solar variability and climate indices including temperature, precipitation, droughts, floods, streamflow, and monsoons.
* The IPCC fails to consider the importance of the demonstrated empirical relationship between solar activity, the ingress of galactic cosmic rays, and the formation of low clouds.
* During the past 25,000 years (late Pleistocene and Holocene) glaciers around the world have fluctuated broadly in concert with changing climate, at times shrinking to positions and volumes smaller than today.
* The relationship between drought and global warming is weak, since severe droughts occurred during both the Medieval Warm Period and the Little Ice Age.
* And how despite the supposedly “unprecedented” warming of the twentieth century, there has been no increase in the intensity or frequency of tropical cyclones globally or in any of the specific ocean basins.
You wouldn’t want to embarrass yourself by not having anything to say about those points, right?
Again, that reply was posted as I was being deleted. (I looked for it on the site immediately after hitting “post” and saw that I was erased.) So, I tried putting up another post — which may be taken down, as well. Who knows:
My last comment was deleted. I thought it was innocuous enough to meet the Guardian’s “community standards.” For the record …
I insulted no one. My comment contained no personal attacks, and it was not an act of “persistent trolling” (Guideline #1). I did not smear anyone or misrepresent the Guardian or its journalists (Guideline #2). It was not “offensive” or “threatening” (Guideline #3), or part of a “flame war (Guideline #4). Nor was it racist, sexist, homophobic or any other form of “hate-speech” (Guideline #5). My comment was not libelous (Guideline #6), nor was it spam (Guideline #7), though I did include a link. It was relevant to the discussion (Guideline #8), it was reasonable (Guideline #9), and objectively constructive to the conversation (Guideline #10).
So, in the spirit of the Guardian’s stated mission to make its website “a welcoming space for intelligent discussion,” I will try again. My original comment, just about verbatim:
The climate is always changing. But is human activity causing runaway global warming? Is man causing a climate crisis? On those questions the science is not settled.
I then put in a link to ClimateChangeReconsidered.org. I don’t hyperlink it here … for fear of violating some sort of “community guideline,” but you can copy and paste the URL yourself.
Argument victory strategy of the left: When you’re losing the agrument, construct a straw man. When your straw man is burned up, yell and scream. When your throat gives out, ban all who disagree.
With Tax Day 2014 behind us, it might be tempting to turn away from thoughts of the taxman and to let the pain abate a while. For decades Americans have done just that; they have accepted taxation, albeit begrudgingly, as a necessary part of life in society and have taken the hurt with a certain stoicism. Sometimes voices have been raised against the sapping power of taxation, yet taxes have continued to rise along with government spending. The time of stoic acceptance may be coming to an end.
A series of recent Reason-Rupe polls, however, has revealed that discontent with the Byzantine tax code, and the feckless government apparatus it supports, has reached record levels. According to the polls, a general disbelief in the government’s ability to make efficient use of taxpayers’ money that has been built up to the point where respondents now believe that half of every dollar paid in taxes is wasted!
Similarly, a concurrent poll found that a mere 17% of Americans believe that government spending of tax money was better for society than would have been giving the same amount of money to charity or investing it in private business. Furthermore, more than one-third of respondents said government spending was actually less beneficial than charity or investment. That is far from a ringing endorsement of the current tax regime.
The mixture of these two beliefs, in government waste and in superior alternatives, can make for a powerful cocktail for reformist sentiment. While it might once have been possible to dismiss organizations seeking to overhaul the tax code, like Americans for Tax Reform, as a radical fringe element in the conservative movement, that is no longer possible when a majority of citizens are now convinced of the system’s iniquities.
Right now we are confronting a real, and perhaps unique, opportunity to fundamentally transform the way our government collects and spends citizens’ money. The wave of discontent is gathering and the winds of change are blowing it into a swell. The fact of this transformative mood is revealed in a further Reason-Rupe poll, which shows an astonishing 62% of Americans now in favor of replacing the current graduated income tax with a flat-rate tax.
Reformist moments are often few and far between in politics, and this one will not last long. Democratic politicians in particular are adroit at turning public discontent with government failure into anger at the wealthy. Gallup polls show a growing sentiment among respondents that the current distribution of wealth is unfair and that heavy taxes on the very rich would help serve to redress the balance. While this sentiment may at first seem contradictory to the desire for a flatter tax system, upon close inspection it is not. Indeed, much of the anger is the product of misdirected blame.
Many middle class and aspiring-to-middle class Americans see an apparent imbalance of power in the tax system. While some wealthy citizens can exploit loopholes in the labyrinthine tax code, ordinary people are not so lucky. This has led to a dangerous resentment.
What can be done to ameliorate these desires for greater equity in taxation? Clearly a majority are beginning to see the value of a flat tax in terms of the basic concept of equitable taxation. A properly administered, flatter tax can also go a long way to correcting the resentments that are boiling up in the Gallup poll and spurred on by left wing class warriors. A flatter tax would need to eliminate the loopholes that have become rhetorically devastating to supporters of free markets. The general discontent with the way our tax system works must be harnessed not only to reduce taxes, but also to eliminate the cracks and holes through which people can slip.
While paying the set rate of tax may be unpleasant to someone of means, it is the necessary requisite for a flatter tax system to be implemented and to succeed.