Category Archives: President Obama

“Friedman Friday” EPISODE “The Failure of Socialism” of Free to Choose in 1990 by Milton Friedman (Part 2)

Milton Friedman: Free To Choose – The Failure Of Socialism With Ronald Reagan (Full)

Published on Mar 19, 2012 by

Milton Friedman’s writings affected me greatly when I first discovered them and I wanted to share with you.

Ronald Reagan introduces this program, and traces a line from Adam Smith’s “The Wealth of Nations” to Milton Friedman’s work, describing Free to Choose as “a survival kit for you, for our nation and for freedom.” Dr. Friedman travels to Hungary and Czechoslovakia to learn how Eastern Europeans are rebuilding their collapsed economies. His conclusion: they must accept the verdict of history that governments create no wealth. Economic freedom is the only source of prosperity. That means free, private markets. Attempts to find a “third way” between socialism and free markets are doomed from the start. If the people of Eastern Europe are given the chance to make their own choices they will achieve a high level of prosperity. Friedman tells us individual stories about how small businesses struggle to survive against the remains of extensive government control. Friedman says, “Everybody knows what needs to be done. The property that is now in the hands of the state, needs to be gotten into the hands of private people who can use it in accordance with their own interests and values.” Eastern Europe has observed the history of free markets in the United States and wants to copy our success. After the documentary, Dr. Friedman talks further about government and the economy with Gary Becker of the University of Chicago and Samuel Bowles of the University of Massachusetts. In a wide-ranging discussion, they disagree about the results of economic controls in countries around the world, with Friedman defending his thesis that the best government role is the smallest one.
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Below is a portion of the transcript of the program and above you will find the complete video of the program:
 

Here is another real success story, this time in Czechoslovakia. Martin was a rock musician. Today he makes documentary films. Some years ago, he did a concert tour of the United States and brought back secondhand recording equipment. The communist government let him bring it back, after paying a hefty import tax, because he said he wanted to record folk music __ something the government was not doing and did not plan to do.

In the past year, since things have opened up, his business has exploded. Along with music and films, he now duplicates video cassettes. He also makes audio cassettes for other Czech producers and has devised his own English language course on tape. He is on his way and many more will follow if the government just gets out of their way. You just can’t keep good people like that down.

The guests at this party aren’t much interested in self-driving entrepreneurs like Martin. High powered business executives from North America and West Europe __ they are interested in bigger game. They are here to do business and make good profits for their firms. They’ll do it by arranging joint ventures between their western companies and government enterprises. To succeed, they have to get on the right side of the politicians and the bureaucrats who are in charge. It is large scale lobbying, very much in the western manner. The danger is that in the process, local government bureaucrats and big foreign business will end up freezing out local entrepreneurs.

Friedman: The assets of Hungary belong to the people of Hungary. I do not believe they should be sold. You are a citizen of Hungary, who owns the state enterprises?

Unknown: Okay, the society as a whole.

Friedman: Not the society, the people.

Unknown: Well, give it to the people.

Friedman: In finance ministries all over Eastern Europe, the talk is all about privatization, but rhetoric is one thing __ action sometimes very different.

One example is in Prague where Vacla Klouse, the finance minister, is desperately trying to free the Czech economy.

Vacla Klouse: The people who were the reformers at that time were done after the Russian invasion, they were fired from their jobs and they return to politics with their own extremely obsolete ideas, and now they are trying . . .

Friedman: But he is up against political planners that aren’t ready to give up control. They are all anticommunists, all in favor of markets, but many are still beguiled by the idea of market socialism. A third way between capitalism and socialism, Klouse and I believe that is a mirage __ that a third way will take Czechoslovakia straight to the third world. It must either move directly to a pure free market, or it will get stuck just as Yugoslavia has.

Klouse: . . . I think intellectuals tend to underestimate the intelligence of the ordinary people . . .

Friedman: Poland and Hungary have exactly the same problem. Some, like Klouse, want to move to free markets right away. Others still hanker after socialist control of the markets.

Klouse: . . . use the word naive citizens. They are the interventionist economies and the other, so this is my speech in the parliament . . . . . .

Friedman: Political power is limited, but economic power is not limited and you can have, if you have one millionaire, you can have another millionaire, another millionaire, without anybody else being worse off. In fact, everybody else will be better off. It seems to me again, the people understand that. I can’t believe that your ordinary people here don’t. They know overnight you can make a change if you could only get the government off the back of the people.

Where are we headed __ we are heading all the way up here __ we’ll get there. Let’s not get any more gas than we need to. What is it? It is about $1.00 a liter which makes it about $4.00 a gallon of gas.

In these countries, the hardest problem is to transform their heavy industries. This is Novahoota, a vast collection of steel mills in Poland and a disaster in every sense. It is inefficient, costly, and above all, a major polluter. The best thing to do with places like this would be to bulldoze them, but that is almost impossible. They are too well shielded by special interests: the unions, the bureaucrats, and all the other political interests on the fringes.

The communists socialize the means of production. They tried to run everything from the center. It didn’t work. It was a mess and a failure. We in the United States, on the other hand, have been socializing the fruits of production. That is, the government has been taking money from some people, the people who produce the goods and services, and giving it to other people who do not produce goods and services. The end result is likely to be the same loss of incentive and organization if we carry it too far. That is one lesson we should learn from these countries.

A year ago, the cornucopia of fruits and vegetables and other things in this street market were simply not obtainable. It is one of the first signs of the flowering of enterprise under the new regime. This market is in Krakow, Poland. Goods are readily available now, only because the government eliminated price controls allowing the market to set the prices. Like a miracle, overnight the stalls had goods for sale. This gentleman sells bulbs and seeds. He is happy in the market, but many traders would like to set up in stores and develop on a larger scale. At the moment, they can’t. The stores are all owned by the state. The traders are stymied unless and until the stores become private property. When they do, the market will get another boost.

This youngster is 16. He is still in high school, but this is Saturday and he is in the market selling jeans from Thailand, making a little money for himself. He is studying to be a gardener. But when I asked him what he was going to do when he left school, he had no hesitation __ he was going to be a businessman. There is the hope of Poland.

Everybody knows what needs to be done. The property that is now in the hands of the state need to be gotten into the hands of the private people who can use it in accordance with their own interests and values. The problem is how to do it. Now that you have some degree of political freedom, there is an awful fight going on about who is going to get what share of the total pie. Everybody wants a little bigger piece. It is a political mine field, but unless that mine field can be gotten through, the game is up. It will be a failure. If it can be gotten through, then you will have an opportunity for these resources to be used the right way for the right things.

We in the West know only too well how hard it is to get the government out of something once they have been in it. Here in Poland they have been in it for 50 years and in a much bigger way than the United States. So they have a real job on their hands.

It would be silly of us, on the basis of a brief trip, to try to judge how successful these countries will be in doing what no country has yet been able to do __ transform a totalitarian state into a prosperous, free society. If this experiment is successful, it will not only transform Eastern Europe __ it will also offer an invaluable blueprint for the economic development of many poor countries.

You know, nothing is more striking than the wide differences in the standard of life of people who live in different parts of the world. Why? Not because of race or religion or culture or natural resources. After all, the Chinese who live in Hong Kong and in Taiwan are of the same race and background as those who live in Red China, yet their standards of living are vastly different. The same thing is true of East Germany and West Germany; of South Korea and North Korea; of Japan before the major restoration and Japan after the major restoration. The real explanation are the economic institutions that they adopt __free private markets versus central planning.

The countries of Eastern Europe have finally overthrown their communist masters who foisted central control on them. They have the rare opportunity to write on a clean slate; to create the institutions of private property and free markets that are the only ones that have ever achieved widespread prosperity and human freedom. We in the United States, on the basis of our experience of the last 10 years, know how hard it is to cut a government down to size. We hope they succeed better than we did. If they do, we will learn as much from them as they have learned from our example.

Fiscal Cliff deals of the past

Does Government Have a Revenue or Spending Problem?

People say the government has a debt problem. Debt is caused by deficits, which is the difference between what the government collects in tax revenue and the amount of government spending. Every time the government runs a deficit, the government debt increases. So what’s to blame: too much spending, or too little tax revenue? Economics professor Antony Davies examines the data and concludes that the root cause of the debt is too much government spending.

Ronald Reagan on our ability to solve our problems

Great article on what has happened in the past fiscal cliff deals. Patrick Louis Knudsen rightly points out, “… history shows that broad bipartisan compromises between the White House and Congress have typically just yielded higher taxes, while … deficit reduction have failed to materialize.”

It seems to me that we need to cut spending and avoid slowing the economy with tax increases. In the past we just raised taxes most of the time and never got around to cuttng spending.

The Fiscal Cliff and the Perils of Grand Budget Deals

By
December 10, 2012

One of the major complications in the current fiscal cliff debate is that both sides are overreaching, trying to tie a near-term resolution to a sweeping deficit reduction plan that would address the longer-term budgetary crisis looming in the years ahead. They see the cliff negotiations as a stage for a “grand bargain” on the budget between the President and Congress.

The tight time frame of the cliff’s approach makes such an aim increasingly impractical. Furthermore, history shows that broad bipartisan compromises between the White House and Congress have typically just yielded higher taxes, while the promised spending restraint (except in national defense) and deficit reduction have failed to materialize. Given the current state of divided government, these risks prevail today. More broadly, they also offer a warning to budget process reformers who seek to institutionalize regular budget negotiations between Capitol Hill and the President.

Experience of the Reagan Administration

After his inauguration in January 1981, President Ronald Reagan moved assertively to enact his budget plan, cutting taxes, boosting defense spending, and seeking to gain control of entitlements. With the economy still reeling from the prior years’ stagflation, however, deficits widened initially, leading Congress to push for a series of budget “summits,” as they were called then, to close the gap.

First came the 1982 Tax Equity and Fiscal Responsibility Act, “a $98 billion tax increase which supporters claimed would reduce the deficit from $128 billion in 1982 to $104 billion in 1983.” It did not. “Spending restraints never materialized…and the actual deficit jumped to $208 billion.”[1] (In today’s dollars, that tax hike would have totaled $204 billion and the deficit $432 billion—roughly a third of this year’s red ink.)

In 1984, the President agreed to yet another tax hike totaling $49 billion, which was supposed to reduce the deficit from $185 billion to $181 billion. Once again, however, the deficit increased—to $212 billion.[2]

The 1987 budget summit repeated the pattern. President Reagan swallowed a tax hike of $28 billion, but the result was the same: “The deficit, which was supposed to remain at $150 billion, jumped to $155 billion in 1988.”[3]

The 1990 Budget Agreement

Despite these failures, 1990 produced another major exercise in budget summitry. With deficits having swollen well beyond target amounts written in law at the time, the government by mid-year faced automatic spending cuts (called “sequestration”) that would slash defense spending by 42 percent and non-defense spending by 38 percent.[4] So President George H. W. Bush and the Democratic Congress agreed to a plan that was estimated to reduce deficits by $482 billion over five years.

Though the President had famously pledged never to raise taxes, his Administration by mid-1990 conceded to adding “revenue” as part of the deficit reduction plan. Predictably, this crack in the door widened during the arduous negotiations at Andrews Air Force Base. In the end, fully one-third of the package—$158 billion—consisted of tax hikes. The next largest savings came from cutting national defense by $91 billion over five years, which proponents rationalized by arguing that the Cold War had ended. Meanwhile, non-defense discretionary spending in the plan actually increased by $45 billion, offset by an empty promise of $144 billion in additional, unspecified discretionary cuts.[5]

The plan’s outcomes were no more satisfying. Even after the defense cuts, total outlays (excluding interest payments) increased by 13 percent from 1990 through 1993, and even with the tax hikes, the deficit worsened by 17 percent in the first two years of the plan.[6] When President Bill Clinton took office in January 1993, he promptly called for another deficit reduction plan, this one with $241 billion in tax increases over five years.[7]

The 1997 Balanced Budget Agreement

Even genuinely successful deficit reduction can lead to expanded government, allowing both parties to declare victory. Such was the case with the 1997 balanced budget agreement between a Republican Congress and President Clinton.

Although it cut taxes by $80 billion over five years—or perhaps because it did—the plan produced surpluses within a year of enactment. This was largely due to real growth in gross domestic product (GDP) that was greater than 4 percent per year from 1997 through 2000, which boosted tax revenue to 20.6 percent of GDP.

The problem was that the plan also increased spending. Though officially estimated to reduce outlays by $198 billion over five years,[8] the legislation contained a number of entitlement spending increases sought by President Clinton, including the creation of the State Children’s Health Insurance Program and expansions of food stamps, Supplemental Security Income, and welfare. Consequently, total “programmatic” spending (excluding interest) grew by nearly 3 percent to 4 percent per year faster than inflation and exploded by a total of nearly 14 percent from 1997 through 2001.[9] The effect was hidden because with the government running budget surpluses, interest payments declined, reducing the total spending increases.

Learn from History

The background outlined above should give pause to advocates of a grand budget deal between the President and Congress—especially those who are seeking to limit the size and scope of government. Such agreements tend to produce higher taxes and higher spending with little or no deficit reduction. Congress and the President should dispel any visions of a “grand bargain” and focus on the task at hand: avoiding the fiscal cliff.

This history also warns against budget process reforms that would institutionalize summitry by requiring the President to sign or veto the congressional budget resolution. Advocates argue that this change would create a forum for regular, early White House–congressional negotiations on broad budget levels, presumably making it easier to settle on specific spending and tax legislation later.

Some analysts, however, doubt whether the practice would actually produce agreements as often as its advocates think.[10] Equally important, the process could produce higher spending and higher taxes even more often. Thus, a reform aimed at budgeting more “efficiently” might only be more efficient at expanding government.

Patrick Louis Knudsen is the Grover M. Hermann Fellow in Federal Budgetary Affairs in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation. Kaitlyn Evans and Paul Bremmer, members of the Young Leaders Program at Heritage, contributed to this report.

Open letter to President Obama (Part 192)

 

President Obama c/o The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear Mr. President,

I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on what is going on out here.

We seem to be spending too much like Greece then why do we expect a different result?

Amy Payne

June 18, 2012 at 9:04 am

The President and his team have been blaming “European headwinds” for some of the U.S. economy’s woes. But the truth is that the policies pursued by Washington and Athens are frighteningly similar—and the outcomes are not good for either country. Both countries are in need of comprehensive fiscal reforms, yet their leaders have avoided the tough decisions in favor of bailouts and political posturing.

In yesterday’s election, political parties supporting Greece’s bailout secured a narrow victory, causing Europe and world markets to breathe a temporary sigh of relief. The parties must now form a coalition government, despite continued protests from the radical party that sought to throw out the terms of the bailout assistance—which could have led Greece out of the euro currency. At 22 percent unemployment, Greek voters expressed disappointment with their limited options.

The Greek crisis was foreshadowed in this year’s Heritage Foundation/Wall Street Journal Index of Economic Freedom, with Greece registering the largest decline in economic freedom of any country in the world. Its economy is rated “mostly unfree,” and it has the fifth-lowest economic freedom score in Europe, beating only Russia and three former Soviet republics.

Why is it in such a state? The authors of the Index point to “decades of overspending, a lack of structural reform progress, and endemic corruption,” noting that Greece’s “lack of competitiveness and fading business confidence are serious impediments to economic revival. Adjustments in market conditions have been stifled or delayed by public unions.”

Sound familiar?

It should, because the similarities between the U.S. and Greece are alarming. Two years ago, Heritage’s J.D. Foster said that “We’re not Greece…yet.” Since he wrote that in May 2010, however, U.S. debt has nearly doubled as a share of the economy. Greece’s public debt, at 165 percent of gross domestic product (GDP), doesn’t seem that unreal any more.

A few other points of comparison: The U.S. corporate tax rate is higher than Greece’s. The Index of Economic Freedom pegged America’s overall tax burden at 24 percent of total domestic income, while Greece’s overall tax burden was 30 percent of GDP. Government spending inAmerica—42 percent of GDP—approaches Greece’s government spending level, which exceeds 50 percent of its GDP.

Both countries have structural economic deficiencies—like tax rates and labor regulations—that are causing deeply rooted problems. And both countries have tried to solve their fiscal problems through bailouts, to no avail.

Though it goes back to the adoption of the euro in 1999, the European crisis first broke into the open some 10 years later. In April 2009, the European Union told France, Spain, Ireland, and Greece to reduce their budget deficits in the wake of the credit crisis. Since the crisis began, Europe has substantially weakened its banking system, which is propped up only by central bank cash and shaky bailouts.

Now, defaulting on loans is a real possibility for Greece and other European nations. They have too long dismissed the need for economic growth in favor of government intervention.

Going into the G20 summit today and tomorrow in Mexico, President Obama “has called on European leaders to recapitalize weak banks and to focus on economic growth and not just budget austerity,” reports Reuters. Basically, he has been urging European governments to spend more now, even as their borrowing costs and debt far exceed sustainable levels. One wonders how countries that have limited or no access to credit markets because of their dire fiscal situations are supposed to borrow the money for all this additional spending. There is only one substantive difference between Obama’s policies for Europe and his domestic policy, where he has urged expanding government jobs as a solution to U.S. unemployment: The U.S. government can still borrow to finance its deficits, because we’re only partway down the road the Greeks have already traveled.

The overspending, overtaxing, over-borrowing and over-regulating approach does not work for Europe any more than it works for America.

To deal with any European financial fallout that might affect the U.S., we have to stop embracing the same policies. Congress and the President should rein in federal spending immediately by choice rather than being eventually forced to do so, as countries across Europe have been. They should declare a regulatory cease-fire and disarm the Taxmageddon threat.

America is responsible for its own economic problems, regardless of the winds sweeping across the Atlantic.

_____________

Thank you so much for your time. I know how valuable it is. I also appreciate the fine family that you have and your commitment as a father and a husband.

Sincerely,

Everette Hatcher III, 13900 Cottontail Lane, Alexander, AR 72002, ph 501-920-5733, lowcostsqueegees@yahoo.com

Are other countries passing us by because of the directon liberals are taking us? (Part 25)

 

These posts are all dealing with issues that President Obama did not help on in his first term. I am hopeful that he will continue to respond to my letters that I have written him and that he will especially reconsider his view on the following import issue which deals with holding down federal spending. Is President Obama going to bankrupt our country by going from 10 trillion to 22 trillion in debt? We better shape up now or other countries will overtake us economically.

If we cut spending and balance our budget and enact pro-market reforms then our economy would boom too.  

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Those Sneaky Canadians Are Overtaking the United States

May 30, 2012 by Dan Mitchell

I’m not quite ready to trade places with Canada, but it may just be a matter of time. Like Germany and Sweden, they seem to be slowly but surely trying to move in the right direction.

I’ve already commented on good Canadian fiscal policy (including a much-needed lesson for Paul Krugman), and I’ve also praised our northern neighbors for privatizing their air traffic control system and opposing global bank taxes.

But I’ve just been skating along the surface. My Cato colleague Chris Edwards (a Canadian transplant) has just written up a report with some of the key details.

Two decades ago Canada suffered a deep recession and teetered on the brink of a debt crisis caused by rising government spending. The Wall Street Journalsaid that growing debt was making Canada an “honorary member of the third world” with the “northern peso” as its currency. But Canada reversed course and cut spending, balanced its budget, and enacted various pro-market reforms. The economy boomed, unemployment plunged, and the formerly weak Canadian dollar soared to reach parity with the U.S. dollar. …[In] the early 1990s combined federal, provincial, and local spending peaked at more than half of gross domestic product (GDP). In the 1993 elections, Prime Minister Jean Chretien’s Liberals gained power promising fiscal restraint, but this was the party of Trudeau, and so major reforms seemed unlikely. In the first Liberal budget in 1994, Finance Minister Paul Martin provided some modest spending restraint. But in his second budget in 1995, he began serious cutting. In just two years, total noninterest spending fell by 10 percent, which would be like the U.S. Congress chopping $340 billion from this year’s noninterest federal spending of $3.4 trillion. When U.S. policymakers talk about “cutting” spending, they usually mean reducing spending growth rates, but the Canadians actually spent less when they reformed their budget in the 1990s. The Canadian government cut defense, unemployment insurance, transportation, business subsidies, aid to provincial governments, and many other items. After the first two years of cuts, the government held spending growth to about 2 percent for the next three years. With this restraint, federal spending as a share of GDP plunged from 22 percent in 1995 to 17 percent by 2000. The spending share kept falling during the 2000s to reach 15 percent by 2006, which was the lowest level since the 1940s. …The spending reforms of the 1990s allowed the Canadian federal government to balance its budget every year between 1998 and 2008. The government’s debt plunged from 68 percent of GDP in 1995 to just 34 percent today.

Total government spending, including sub-national units such as states and provinces, is still slightly higher in Canada than in the United States. But I suspect that will change within the next five years.

Not surprisingly, good spending policy leads to good tax policy, as Chris explains.

a slimmed-down Canadian government under the Liberals enjoyed large budget surpluses and pursued an array of tax cuts. The Conservatives continued cutting after they assumed power in 2006. During the 2000s the top capital gains tax rate was cut to 14.5 percent, special “capital taxes” on businesses were mainly abolished, income taxes were trimmed, and income tax brackets were fully indexed for inflation. Another reform was the creation of Tax-Free Savings Accounts, which are like Roth IRAs in the United States, except more flexible. The most dramatic cuts were to corporate taxes. The federal corporate tax rate was cut from 29 percent in 2000 to 15 percent in 2012. Most provinces also trimmed their corporate taxes, so that the overall average rate in Canada is just 27 percent today. By contrast, the average U.S. federal-state rate is 40 percent. …Canada’s federal corporate tax rate has been cut from 38 percent in the early 1980s to just 15 percent today. Despite the much lower rate, tax revenues have not declined. Indeed, corporate tax revenues averaged 2.1 percent of GDP during the 1980s and a slightly higher 2.3 percent during the 2000s.

The Laffer Curve effect of higher tax revenue shouldn’t be surprising, though American policymakers still operate in a fantasy world where taxes are assumed to have no impact on the economy and no impact on taxable income.

But that’s a secondary point. The main lesson of this research by Chris is that it is both possible and desirable to shrink the burden of government spending.

And it’s not just Canada that has done the right thing. This video outlines past reforms in Ireland, Slovakia, and New Zealand as well.

P.S. Other than the cold weather, another reason why I don’t quite yet want to trade places with Canada is the government-run healthcare system. Right now, high-ranking politicians from the frozen wastelands can escape to America when they fall ill. If we copy Canada (and we’re already pretty far down that path), then where will we be able to go to get high-quality and cutting-edge care?

P.P.S. The Canadians aren’t know for having a sense of humor, but the person who wrote this parody about emigrating American leftists definitely has a good sense of humor.

Flat Tax would lower the incentive to avoid paying taxes

The Flat Tax would lower the incentive to avoid paying taxes to the government. Then it seems that those who complain about all the  Washington influence-peddling and lobbying  should support the Flat Tax. Max Brantley of the Arkansas Times complains probably the most but there is no way he would favor trying to lesson the problem with a Flat Tax.

I’ve been very critical of Obama’s class-warfare ideology because it leads to bad fiscal policy. But perhaps it is time to give some attention to other arguments against high tax rates.

Robert Samuelson, a columnist for the Washington Post, has a very important insight about tax rates and sleaze in Washington.

His column is mostly about Obama’s anti-tax reform agenda, but it includes this very important passage.

…many politicians support tax breaks for favored groups (the elderly, the poor, small business) and causes (homeownership, attending college, “green” industries). This enhances their power. The man who really pronounced the death sentence for the Tax Reform Act of 1986 was Bill Clinton, who increased the top rate to 39.6 percent rather than broadening the base. As the top rate rose, so did the value of generating new tax breaks. Ironically, many of the people who complain the loudest about Washington influence-peddling and lobbying are the same people who support higher tax rates, which stimulate more influence-peddling and lobbying.

The last sentence is key. Higher tax rates are good news for the politicians, interest groups, bureaucrats, and lobbyists that dominate Washington.

Here’s a simple example. Let’s pretend we have a modest tax rate of 20 percent. Now imagine you are part of an industry with $200 million in profits and you want a special tax break. How much are you willing to pay to get that loophole?

Well, with a 20 percent tax, the most you can save (assuming the loophole is huge and you wipe out all your tax liability) is $40 million.

So how much would you spend on lobbyists, campaign contributions, etc, in order to get that loophole? That’s hard to answer, because it would require some estimate of the probability of success. But one thing we can safely assume is that the industry would never spend more than $40 million.

But let’s now assume you live in a world with 50 percent tax rates. Does that change the incentive for influence peddling in Washington? Of course it does. The industry’s tax bill is now $100 million, so it now has an incentive to spend up to that amount to get special treatment.

So now let’s consider a couple of additional hypothetical questions.

  • First, imagine you’re a lobbyist. Do you think you will get more business if tax rates are high, or if tax rates are low?
  • Second, imagine you are a politician. Do you think you will get more campaign contributions if tax rates are high, or if tax rates are low?

The answers are obvious, and so are the implications. Yes, higher tax rates are bad for growth and competitiveness. And, yes, they are unfair and discriminatory.

But they also foment and encourage sleaze in D.C., and that’s something that honest leftists should hate as much as the rest of us.

For more information, here’s my video on the link between big government and corruption, including a section on how a loophole-ridden tax system benefits Washington insiders.

The Flat Tax: How it Works and Why it is Good for America

Both videos have good information (at least I like to think), but kudos to Samuelson for drawing an important link between high tax rates and corruption.

P.S. Robert Samuelson is hard to pin down on the philosophical spectrum. He’s written very good columns denouncing Obama’s manipulation of welfare statistics and criticizing the President’s flirtation with the value-added tax. But he’s also had a couple of columns where he identifies a very real problem, but fails to reach the right conclusion, including this piece that should have been an argument for Austrian economics and this piece on health care inefficiency that should have pinned the blame on third-party payer.

John Boehner going to stand up to the President?

How Raising Taxes Will Not Balance the Budget: More Evidence

Published on Nov 15, 2012

Although it may seem counterintuitive, raising taxes on the rich does not actually increase the amount of taxes the government collects. How could this possibly be the case? According to Professor Antony Davies, it is because the many loopholes in federal income taxes, capital gains taxes, and many other taxes, enable people to partially avoid these taxes. Perhaps instead of discussing how to raise tax revenues, we should spend our energy simplifying the tax code. This would make it more difficult for people to avoid taxes and, Davies says, “The less time and money we spend trying to work around a complex tax code, the more time and money we will have available to put to more productive uses.”

Do you think that the tax code is too complicated? Let us know in the comments!

____________

I have done my part by writing letters over and over and over to John Boehner begging him to hold the line on spending and to not give in to President Obama on tax increases. I doubt seriously that he will do that. Here is an article below that shares my same concerns.

Boehner’s Blunder

by Michael D. Tanner

Michael Tanner is a senior fellow at the Cato Institute and author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution.

Added to cato.org on November 14, 2012

This article appeared on National Review (Online)on November 14, 2012.

Well, that didn’t take long.

They hadn’t even finished counting the ballots in Florida when House speaker John Boehner indicated that Republicans were preparing to surrender on issues ranging from taxes to health-care reform.

With regard to taxes, Boehner signaled that he was once again open to a “grand bargain” to avoid the looming fiscal cliff. While he kept an increase in tax rates off the table for now, Boehner said that he was open to “additional revenue” as part of a deal. Such additional revenue could, of course, take many forms, such as closing loopholes, raising fees, or counting on increased economic growth. But by preemptively conceding on revenue, Speaker Boehner takes the focus off the need to cut spending.

Giving in on key Republican principles such as taxes is no way to rebuild the party.

Speaker Boehner correctly noted that everyone agrees we can’t keep spending more than we take in. But that implies that the problem is simply the difference between what comes in and what goes out. It’s not.

The Congressional Budget Office projects that, under current policy, federal spending will reach 46 percent of GDP by mid-century — even if we never add another new government program. True, a substantial portion of that spending will be interest on the federal debt. Theoretically, therefore, if taxes were increased enough to cover spending and close the deficit, adding no additional debt, we’d have far lower interest payments, meaning that total levels of government spending would be lower in the future. Lower, but not that low: Even if one assumes that the government accumulated no additional debt beyond the $16.2 trillion it currently owes, federal government spending would still approach 30 percent of GDP by 2050. Throw in state and local spending, and government at all levels would consume roughly half of everything produced in this country. We might have no deficit, but we would have both higher government spending and a bigger tax burden than Greece has today.

Boehner’s willingness to give in so easily on revenues makes it less likely that there will be real spending cuts as part of any deal. We’re likely to get more of the sort of smoke-and-mirrors measures that the president has already proposed, such as reliance on phantom savings from ending the wars in Iraq and Afghanistan, double-counting cuts that were already included in last year’s budget agreement, and the perennial promises to eliminate “fraud, waste, and abuse.” Just look at how illusory the alleged spending cuts in last year’s debt-ceiling deal turned out to be: In the twelve months following that deal, federal spending actually increased by 3.6 percent, an average of $11 billion more every month.

At a minimum, Speaker Boehner seems to have given up any leverage that he might have had to demand the entitlement reforms necessary for any long-term spending restraint. Having conceded on taxes, what does he have left to trade?

For that matter, even his line in the sand about tax rates seems unlikely to hold. Having already surrendered to the idea of tax hikes, the debate becomes one not about whether to raise taxes but about which taxes or whose taxes to increase.

Similarly, the speaker sent conflicting signals on whether or not Republicans will continue to pursue repeal of Obamacare. Boehner first told Diane Sawyer that “Obamacare is the law of the land,” and that Republicans will no longer devote political capital to repealing it, while maintaining that there “may be parts of it that we believe need to be changed.” Later he walked those comments back in a tweet, saying that full repeal remained a Republican goal.

If nothing else, Boehner’s health-care remarks muddy the party’s position on a crucial issue.

It is not as though Obamacare has become significantly more popular. Exit polls showed that even an electorate that reelected President Obama opposed the new health-care law by 49 to 44 percent. And many of the law’s most damaging and unpopular provisions have not even kicked in yet. Next year, for instance, will see the implementation of many of its new taxes, including the medical-device tax, a Medicare payroll-tax hike for those making over $200,000, and a new surtax on investment income for the same group. And, of course, in 2014, just in time for the midterm elections, Americans will be hit by the law’s individual and employer mandates.

Obviously, with the Democrats in control of the Senate and President Obama reelected, Obamacare was not going to be repealed this year. But that doesn’t mean that Republicans should stop fighting it. House Republicans still have the power of the purse, and state governments have been entrusted with the law’s implementation. At least ten states have refused to set up the insurance exchanges that the law stipulates. (Governors Bob McDonell of Virginia and Sam Brownback of Kansas are the latest to announce that their states will not do so.) At least another eight states simply will not be able to set one up before the law’s deadline of January 1, 2014. That means that the Obama administration will have to seek additional funding in order to operate federal exchanges in those states. House Republicans should refuse to appropriate any such funds and should block attempts by HHS to shift funds appropriated for other purposes.

But can Americans count on House Republicans to hold the line in the wake of Boehner’s comments?

Republicans certainly took a drubbing in this year’s elections. Rethinking and repositioning may well be necessary, especially on immigration and social-issues messaging. But let us not forget that Republicans are only two years removed from a historic landslide victory won in part by opposition to government spending, taxes, and Obamacare. And, despite the Democrats’ best attempts to paint House Republicans as plutocrat-loving, grandma-hating obstructionists, the GOP caucus lost a net of only four seats. Indeed, the Tea Party Caucus, for all the criticism it received, lost only three seats.

John Boehner knows that the Republican brand could use some refurbishment, but surrendering on taxes, spending, and health care is hardly an auspicious way to begin the task.

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Max Brantley of the Arkansas Times noted: House Speaker John Boehner was spotted in Little Rock yesterday — lunch at Whole Hog Cafe and at Cajun’s Wharf during the evening hours. My spin on John Boehner is very simple. He needs to be brave enough to join those conservatives in the House that really do […]

 

Open letter to President Obama (Part 191)

Senator Marco Rubio Talks Cuba, Budget and Obamacare

Published on Mar 22, 2012 by

http://blog.heritage.org/2012/03/22/exclusive-interview-sen-marco-rubio-talks… | Pope Benedict XVI will visit the communist island of Cuba next week. But while there, the Catholic leader has no plans to visit Cuban dissidents who are fighting for freedom from the Castro regime.

Sen. Marco Rubio (R-FL), born to Cuban immigrants, told us in an exclusive interview Wednesday that the pope should make time to see dissidents. Rubio was at Heritage to promote freedom in Cuba, particularly as it relates to technology and Internet access.

_______________

 

President Obama c/o The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear Mr. President,

I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on what is going on out here.

We got to cut spending soon and try some austerity here at home.

Austerity Works

by Michael D. Tanner

Michael Tanner is a senior fellow at the Cato Institute and author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution.

Added to cato.org on June 20, 2012

This article appeared on National Review (Online) on June 20, 2012.

As Greece, and now Spain and Italy, struggle with the crushing burden of debt brought on by the modern welfare state, perhaps we should shift our gaze some 1,200 miles north to see how austerity can actually work.

Exhibit #1 is Estonia. This small Baltic nation recently had a spate of notoriety when its president, Toomas Ilves, got into a Twitter debate with Paul Krugman over the country’s austerity policies. Krugman sneered at Estonia as the “poster child for austerity defenders,” remarking of the nation’s recovery from recession, “this is what passes for economic triumph?” In return, President Ilves criticized Krugman as “smug, overbearing, and patronizing.”

Twitter-borne tit-for-tat aside, here are the facts: Estonia had been one of the showcases for free-market economic policies and had been growing steadily until the 2008 economic crisis burst a debt-fueled property bubble, shut off credit flows, and curbed export demand, plunging the country into a severe economic downturn.

However, instead of increasing government spending in hopes of stimulating the economy, as Krugman has urged, the Estonians rejected Keynesianism in favor of genuine austerity. Among other measures, the Estonian government cut public-sector wages by 10 percent, gradually raised the retirement age from 61 to 65 by 2026, reduced eligibility for health benefits, and liberalized the country’s labormarket, making it easier for businesses to hire and fire workers.

Estonia did unfortunately enact a small increase in its value-added tax, but it deliberately kept taxes low on businesses, investors, and entrepreneurs, refusing to make changes to its flat 21 percent income tax. In fact, the government has put in place plans to reduce the income tax to 20 percent by 2015.

Cutting government spending, reducing taxes, and liberalizing labor markets brings more economic growth, increased employment, less debt, and more prosperity.

Today, Estonia is actually running a budget surplus. Its national debt is 6 percent of GDP. By comparison, Greece’s is 159 percent of GDP. Ours is 102 percent.

Economic growth has been a robust 7.6 percent, the best in the EU. And, although the unemployment rate remains too high, at 11.7 percent, that is down from 19 percent during the worst of the recession. It’s hard to see how a Krugman-style stimulus would have done much better.

Next door, Latvia has also embarked on a successful austerity program. In 2008, facing a deep recession — the worst in Europe, with a 24 percent drop in GDP from 2007 to 2009 — and a run on the country’s largest bank, Latvia turned to Europe for a €7.5 billion bailout. But unlike Greece and other countries that seem to look at such assistance as a form of permanent welfare payment, Latvia used the EU loan as an opportunity to make the painful government reforms necessary to restore long-term economic health.

Latvia embarked on the toughest budget cuts in Europe. Half of all government-run agencies were eliminated, the number of public employees was reduced by a third, and public-sector wages were slashed by an average of 25 percent.

In the end, Latvia borrowed just €4.4 billion of the available €7.5 billion, and its economy is on the rebound. Unemployment, which reached 19 percent at the height of the recession, has declined to around 15 percent. Real GDP growth was 5.5 percent last yearCanada and is expected to be at least 3.5 percent this year. This year’s budget deficit will be just 1.2 percent of GDP, and the national debt is just 37 percent of GDP and declining. The credit-rating agencies recently upgraded the country’s credit-worthiness. And, while Greece mulls leaving the euro zone, Latvia has been pronounced eligible for membership.

The third Baltic country, Lithuania, also dramatically cut government spending — as much as 30 percent in nominal terms — including reductions in public-sector wages of 20 to 30 percent and pension cuts of as much as 11 percent. Unfortunately, Lithuania may have undermined the effects of those cuts by also raising taxes, including a significant hike in corporate taxes. Still, Lithuania is expected to see its economy grow by 2.2 percent this year.

Krugman and others do have a point in saying that the Baltic countries benefit from strong trade opportunities with neighbors such as Sweden and Finland that have growing economies. And it is true that, while their recoveries have been strong, none of the Baltic countries is expected to fully return to pre-recession levels of prosperity until 2014 at the earliest. On the other hand, when are Greece, Spain, or for that matter the United States — none of which has done much if anything to reduce government spending — likely to return to pre-recession growth?

If the Baltics are not a sufficient example of the value of cutting government, we can look a bit to the west, to Switzerland. Switzerland’s constitution includes provisions that limit the country’s ability both to run debt (the growth in government spending can be no higher than average revenue growth, calculated over a multi-year period) and to increasetaxes (taxes can be increased only by a double-majority referendum, meaning that a majority of voters in a majority of cantons would have to approve the increase).

As a result, total government spending in Switzerland at all levels of government is just 34 percent of GDP, compared to an average of 52 percent in the EU, and more than 41 percent in the United States. Switzerland’s national debt is just 41 percent of GDP and shrinking at a time when other European countries are becoming more insolvent. Switzerland’s economic growth has not yet returned to pre-recession levels, but it is better than the growth in, say, Greece or Spain. And its unemployment rate is just 3.1 percent, the lowest in Europe.

If that’s not enough evidence, we can just look to our own neighbor Canada. The Canadian federal government has been reducing spending in real terms since the 1990s. As a result, federal spending as a share of GDP has fallen from 22 percent in 1995 to just 15.9 percent today. Compare that to the United States, where the federal government spends 24 percent of GDP, roughly half again as much. And, while Canadian provincial governments spend appreciably more than do most U.S. states, total government spending at all levels in Canada has declined from 53 percent in the 1990s to just 42 percent today — still far too high, but clearly moving in the right direction.

Canada has also cut taxes. Corporate tax rates at the federal level were slashed from 29 percent in 2000 to 15 percent today, less than half the U.S. federal rate. Capital-gains taxes were also cut, as were, to a lesser degree, income taxes.

When Canada — led for so long by the ultra-liberal Pierre Trudeau — has smaller government and lower taxes than the U.S., something is seriously out of whack.

As a result of these changes, Canada’s national debt is now less than 34 percent of GDP. Its budget deficit this year will be just 3.5 percent of GDP, while ours will be 8.3 percent. Canada’s economy will grow at 2.6 percent this year — a modest rate but faster than ours — and its unemployment rate is 7.3 percent, again better than ours.

All these countries are following the successful examples set by other nations such as Chile, Ireland, and New Zealand in the 1980s and ’90s, and Slovakia from 2000 to 2003.

Of course, none of these examples is perfect, and cuts in government spending will not, by themselves, cure all ills. These countries often benefited from circumstances aside from fiscal discipline. Still, the evidence is there. Cutting government spending, reducing taxes, and liberalizing labor markets brings more economic growth, increased employment, less debt, and more prosperity. The opposite is also true: Bigger government and higher taxes result in more economic misery — see Greece, Spain, etc.

As the United States looks to its future, it is time to decide which path we will follow.

______________

___________

Thank you so much for your time. I know how valuable it is. I also appreciate the fine family that you have and your commitment as a father and a husband.

Sincerely,

Everette Hatcher III, 13900 Cottontail Lane, Alexander, AR 72002, ph 501-920-5733, lowcostsqueegees@yahoo.com

The real truth about the financial condition of Social Security can be seen on the www.thedailyhatch.org

Uploaded by on Jan 8, 2009

Professor Williams explains what’s ahead for Social Security

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Ark Times reader says Social Security is not Ponzi Scheme

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Social Security is a Ponzi scheme that needs to be reformed

We got to do something soon about Social Security. The Case for Social Security Personal Accounts Posted by Daniel J. Mitchell There are two crises facing Social Security. First the program has a gigantic unfunded liability, largely caused by demographics. Second, the program is a very bad deal for younger workers, making them pay record […]

Senator Obama’s ideas on Social Security

Senator Obama’s Social Security Tax Plan Uploaded by afq2007 on Jul 23, 2008 In addition to several other tax increases, Senator Barack Obama wants to increase the Social Security payroll tax burden by imposing the tax on income above $250,000. This would be a sharp departure from current law, which only requires that the tax […]

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Saving Social Security with Personal Retirement Accounts Uploaded by afq2007 on Jan 10, 2011 There are two crises facing Social Security. First the program has a gigantic unfunded liability, largely thanks to demographics. Second, the program is a very bad deal for younger workers, making them pay record amounts of tax in exchange for comparatively meager benefits. This […]

What does the Heritage Foundation have to say about saving Social Security:Study released May 10, 2011 (Part 7)

“Saving the American Dream: The Heritage Plan to Fix the Debt, Cut Spending, and Restore Prosperity,” Heritage Foundation, May 10, 2011 by  Stuart Butler, Ph.D. , Alison Acosta Fraser and William Beach is one of the finest papers I have ever read. Over the next few days I will post portions of this paper, but […]

Only difference between Ponzi scheme and Social Security is you can say no to Ponzi Scheme jh2d

Is Social Security  a Ponzi Scheme? I just started a series on this subject. In this article below you will see where the name “Ponzi scheme” came from and if it should be applied to the Social Security System. Ponzi! Ponzi! Ponzi! 9/14/2011 | Email John Stossel | Columnist’s Archive Ponzi! Ponzi! Ponzi! There, I […]

Social Security a Ponzi scheme?

Uploaded by LibertyPen on Jan 8, 2009 Professor Williams explains what’s ahead for Social Security Dan Mitchell on Social Security I have said that Social Security is a Ponzi scheme and sometimes you will hear someone in the public say the same thing. Yes, It Is a Ponzi Scheme by Michael D. Tanner Michael Tanner […]

Dan Mitchell on Social Security

 

 

President Obama should be protecting unborn children!!!! (Part 24)

 

These posts are all dealing with issues that President Obama did not help on in his first term. I am hopeful that he will continue to respond to my letters that I have written him and that he will especially reconsider his view on the following import issue. President Obama should be protecting unborn children!!!!

The Shifting Focus in the Abortion Debate: Does The Humanity of the Unborn Matter Anymore?

Article ID: DA017

By: Francis J. Beckwith

This article first appeared in the Volume 17 / Number 3 Winter 1995 issue of the Christian Research Journal. For further information or to subscribe to the Christian Research Journal go to: http://www.equip.org

Pro-lifers in the United States have always assumed that if they could demonstrate beyond a reasonable doubt that the fetus is a human person, then it would be only a matter of time before the courts and legislatures would declare nontherapeutic abortion — the willful destruction of a living fetus — unjustified homicide. Thus the pro-life view would be vindicated and nontherapeutic abortion would once again be illegal.

Even pro-abortion Supreme Court Justice Harry Blackmun, who wrote the majority opinion in Roe v. Wade (1973), agrees with this assumption: “If the suggestion of personhood [of the unborn] is established, the appellant’s case, of course, collapses, for the fetus’ right to life is then guaranteed specifically by the [Fourteenth Amendment].”2 The scholarly and popular literature produced by evangelicals on the issue of abortion seems to make this assumption as well.3

In 1985, however, evangelical philosopher Robert Wennberg4 defended a moderate pro-choice position employing an argument first presented in 1971 by M.I.T. philosopher Judith Jarvis Thomson. Thomson argued that even if the fetus is a human person, abortion — at least in the early months of pregnancy — is still morally justified.5 Unfortunately, nearly all the books published by evangelical opponents of abortion since the release of Wennberg’s6 — with the exception of recent works by John and Paul Feinberg,7 Keith J. Pavlischek,8 and this writer9 — have failed to address this important argument. This is so despite the fact that this argument — though nearly a quarter of a century old — is now being suggested by a number of legal scholars as a way to circumvent the problems of fetal personhood which they believe were mishandled in Roe v. Wade.

THOS PERSONHOOD DOES NOT MATTER

In her 1971 article, which by 1986 had become “the most widely reprinted essay in all of contemporary philosophy,”10 Professor Thomson argued that even if the fetus is fully a human person with a right to life, this does not mean a woman must be forced to use her bodily organs to sustain its life. It is much the same, we are told, as the case in which one does not have a right to use another’s kidney if one’s kidney has failed. Consequently, a pregnant woman’s removal of a fetus from her body, even though it will probably result in its death, is no more immoral than an ordinary person’s refusal to donate his or her kidney to another in need of one, even though this refusal will probably result in the death of the prospective recipient. Thomson illustrates her position with the following story:

You wake up in the morning and find yourself back to back in bed with an unconscious violinist. A famous unconscious violinist. He has been found to have a fatal kidney ailment, and the Society of Music Lovers has canvassed all the available medical records and found that you alone have the right blood type to help. They have therefore kidnapped you, and last night the violinist’s circulatory system was plugged into yours, so that your kidneys can be used to extract poisons from his blood as well as your own. The director of the hospital now tells you, “Look we’re sorry the Society of Music Lovers did this to you — we would never have permitted it if we had known. But still, they did it, and the violinist now is plugged into you. To unplug you would be to kill him. But never mind, it’s only for nine months. By then he will have recovered from his ailment, and can safely be unplugged from you.” Is it morally incumbent on you to accede to this situation? No doubt it would be very nice of you if you did, a great kindness. But do you have to accede to it? What if it were not nine months, but nine years? Or still longer? What if the director of the hospital says, “Tough luck, I agree, but you’ve now got to stay in bed, with the violinist plugged into you, for the rest of your life. Because remember this. All persons have a right to life, and violinists are persons. Granted you have a right to decide what happens in and to your body, but a person’s right to life outweighs your right to decide what happens in and to your body. So you cannot ever be unplugged from him.” I imagine that you would regard this as outrageous…(emphasis in original)11

Thomson’s argument makes some very important observations that have gone virtually unnoticed. She is asking, “What happens if, for the sake of argument, we allow the premise [that the unborn are fully human or persons]? How, precisely, are we supposed to get from there to the conclusion that abortion is morally impermissible?”12 That is to say, from the fact that a certain living organism is fully a human person, how does it logically follow that it is never permissible to kill that person?

Although a near unanimous number of ethicists maintain that it is prima facie wrong to kill an innocent human person, a vast majority agree that there may be some circumstances in which taking a human life or letting a human being die is justified, such as in the event of a just war, capital punishment, self-defense, or withdrawing medical treatment. Thomson’s argument, however, includes abortion as one of these justified circumstances. She maintains that, since pregnancy constitutes an infringement by the fetus on the pregnant woman’s personal bodily autonomy, the ordinary abortion — though it results in the death of an innocent human person — is not prima facie wrong.

One can immediately appreciate the appeal of this argument, especially in light of what is arguably the most quoted passage from Roe: “We need not resolve the difficult question of when life begins. When those trained in the respective disciplines of medicine, philosophy, and theology are unable to arrive at any consensus, the judiciary, at this point in the development of man’s knowledge, is not in a position to speculate.”13 The Court, however, did not choose to employ Thomson’s argument, though there is little doubt that it was brought to its attention. Consequently, the Roe Court assumed the major premise of the pro-life position: If the fetus is a person, then abortion in almost every case is unjustified homicide. This, according to a growing number of scholars, was a fatal mistake — a mistake that energized the right-to-life movement.

It appears that the first leading legal scholar to have recommended Thomson’s argument to the judiciary was Michigan Law School professor, Donald Regan, in a law review article that appeared in 1979.14 More recently, Professor Laurence Tribe of Harvard Law School, whose influence on the Court’s liberal wing is well-known, suggested in a 1990 book on abortion that the Court should have seriously considered Thomson’s argument. Tribe writes: “Perhaps the Supreme Court’s opinion in Roe, by gratuitously insisting that the fetus cannot be deemed a ‘person,’ needlessly insulted and alienated those for whom the view that the fetus is a person represents a fundamental article of faith or a bedrock personal commitment…The Court could instead have said: Even if the fetus is a person, our Constitution forbids compelling a woman to carry it for nine months and become a mother” (emphasis in original).15

In his highly acclaimed book, The Culture of Disbelief (1993), Stephen Carter of Yale Law School also recommended Thoinstead of an approach that denies that humanity under cover of the pretense that the definition is none of the state’s business. The conclusion of fetal humanity by no means ends the argument; it simply forces the striking of a balance….My point is that the only fair way around a successful legislative effort to define the fetus as human — the only option that does not deride religiously based moral judgments as inferior to secular ones — is to argue for a right to abortion despite it. And an argument of that kind does not require an attack on the religious motivations of any abortion opponents. (emphasis in original)16

In addition to what has already been mentioned, a subtle philosophical shift seems to have occurred on the Supreme Court as well as society at large, which would indicate an openness to Thomson’s argument. First, in a 1985 article Justice Ruth Bader Ginsburg, recent Clinton appointee to the Supreme Court, chided the Court for appealing to the right to privacy rather than the equal protection clause in its grounding of abortion rights. She argued that since women are unique in their ability to be burdened by pregnancy — giving men a distinct advantage in social and political advancement — women should have the right to abortion based on the constitutional principle that all people, regardless of gender, deserve equal protection under the law. Thus, Ginsburg argued, by permitting women to undergo abortions on the basis of the equal protection clause, the Court would have made a clear stand for gender equity on firm constitutional grounds rather than basing its decision on the controversial and constitutionally vague right to privacy.17

Second, consider the recent physician-assisted suicide cases in Washington state and Michigan, in which a judge in the first case and a jury in the latter acquitted physicians who had killed consenting patients by appealing to an almost absolute principle of personal autonomy. The judge in Washington claimed she could find this principle in the 14th Amendment, the same place Justice Blackmun found the right to privacy in order to constitutionally ground Roe.

Third, in the 1992 case that upheld Roe as precedent, Casey v. Planned Parenthood, the Court asserted the following about the meaning of the 14th Amendment:

Our law affords constitutional protection to personal decisions relating to marriage, procreation, family relationships, child rearing, and education….These matters, involving the most intimate and personal choices a person may make in a lifetime, choices central to personal dignity and autonomy, are central to the liberty protected by the Fourteenth Amendment. At the heart of liberty is the right to define one’s own concept of existence, of meaning, of the universe, and of the mystery of human life. Beliefs about these matters could not define the attributes of personhood were they formed under compulsion by the State.18

Evidently the Supreme Court has chosen to abandon a rigorous defense of philosophical argument in the free marketplace of ideas only to replace it with a New Age mantra (“define your own reality”) in the convenience store of slogans.

In any event, there is little doubt that a shift is occurring in the abortion debate. This shift should be addressed by those who oppose abortion as well as those who, regardless of their stand on abortion, see Thomson’s argument as a threat to the moral force of parental obligations. Let us, therefore, take a critical look at Professor Thomson’s argument.

WHY FETAL PERSONHOOD MATTERS

Although there are a number of problems with Thomson’s argument, the following five are sufficient for the judiciary to reject it from consideration.

(1) Thomson assumes that all moral obligations are voluntary. By using the violinist story as a paradigm for all relationships, Thompson implies that moral obligations must be voluntarily accepted in order to have moral force. Thus she mistakenly infers that all true moral obligations to one’s offspring are voluntary.

Consider the following story. Suppose a couple has a sexual encounter that is fully protected by several forms of birth control short of abortion (condom, the Pill, IUD, and so forth), but nevertheless results in conception. Instead of getting an abortion, the mother of the conceptus decides to bring it to term, although the father is unaware of this decision. After the birth of the child the mother pleads with the father for child support. Because he refuses, she seeks legal action and takes him to court. Although he took every precaution to avoid fatherhood — thus showing that he did not wish to accept such a status — according to nearly all child support laws in the United States he would still be obligated to pay support precisely because of his relationship to this child.19

As Michael Levin points out, “All child-support laws make the parental body an indirect resource for the child. If the father is a construction worker, the state will intervene unless some of his calories he extends lifting equipment go to providing food for his children.”20

For this reason, Keith Pavlischek argues that “given the logic of” Thomson’s argument, “the most reasonable course to follow would be to surrender the defense of paternal support laws for those children whose fathers would rather have had their children aborted.” This “will lend some credence not only to the pro-life insistence on the corollary — that an intimate connection exists between the way we collectively relate to the unborn and the way we relate to our children after birth — but also to the claim made by pro-life feminists that the abortion mentality simply reaffirms the worst historical failings, neglect, and chauvinism ofmales.”21

(2) A case can be made that the unborn does have a prima facie right to her mother’s body. Assuming there is such a thing as a special obligation to one’s children that does not have to be voluntarily accepted to have moral force, it is not obvious that the unborn entity in ordinary circumstances (that is, with the exception of significant life-endangerment to the mother) does not have a natural prima facie claim to her mother’s body. There are several reasons to suppose that the unborn entity does have such a natural claim.

First, unlike Thomson’s violinist, who is artificially attached to another person in order to save his life and is therefore not naturally dependent on any particular human being, the unborn entity is a human being who is by her very nature dependent on her mother. This is how human beings are at this stage of their development.

Second, this period of a human being’s natural development occurs in the womb. This is the journey we all must take and is a necessary condition for any human being’s post-uterine existence. And this fact alone brings out the most glaring disanalogy between the violinist and the unborn: the womb is the unborn’s natural environment whereas being artificially hooked-up to a stranger is not the natural environment for the violinist. It would seem, then, that the unborn has a prima facie natural claim upon its mother’s body.

Third, this same entity, when it becomes a newborn, has a natural claim upon her parents to care for her, regardless of whether her parents “wanted” her (see the above story of the irresponsible father). This is why we prosecute child abusers, people who throw their babies in trashcans, and parents who abandon their children.

Although it should not be ignored that pregnancy and childbirth entail certain emotional, physical, and financial sacrifices on the part of the pregnant woman, these sacrifices are also endemic of parenthood in general (which ordinarily lasts much longer than nine months). And these sacrifices do not justify the execution of troublesome infants and younger children whose existence entails a natural claim to certain financial and bodily goods that are under the ownership of their parents. If the unborn entity is fully human, as Thomson is willing to grant, why should the unborn’s natural prima facie claim to her parents’ goods differ before birth from what it will be after departing her mother’s womb?

Of course, a court will not force a parent to donate a kidney to her dying offspring. But, as in the case of the unconscious violinist, this sort of dependence on another’s body is highly unusual and is not part of the ordinary parental obligations associated with the natural process of human development.

Professor Stephen Schwarz points out that “the very thing that makes it plausible to say that the person in bed with the violinist has no duty to sustain him; namely, that he is a stranger unnaturally hooked up to him, is precisely what is absent in the case of the mother and her child.” That is to say, the mother “does have an obligation to take care of her child, to sustain her, to protect her, and especially, to let her live in the only place where she can now be protected, nourished, and allowed to grow, namely the womb.”22

It is evident that Thomson’s violinist illustration undermines the deep natural bond between mother and child by making it seem no different than two strangers artificially hooked-up to each other so that one can “steal” the service of the other’s kidneys. Rarely if ever has something so human, so natural, so beautiful, and so wonderfully demanding of our human creativity and love been reduced to such a brutal caricature.

This is not to say that the unborn entity has an absolute natural claim to her mother’s body, but simply that she has a prima facie natural claim. For one can easily imagine a situation in which this natural claim is outweighed by other important prima facie values, such as when a pregnancy significantly endangers the mother’s life.

(3) Thomson ignores the fact that abortion is indeed killing and not merely the withholding of treatment. Thomson makes an excellent point in her use of the violinist story; namely, there are times when withholding and/or withdrawing medical treatment is morally justified. For instance, one is not morally obligated to donate his kidney to Fred (one’s next-door neighbor) simply because Fred needs a kidney in order to live. In other words, one is not obligated to risk his life so that Fred may live a few years longer. Fred should not expect that. If, however, one donates a kidney to Fred, one will have acted above and beyond the call of duty, since he will have performed a supererogatory moral act. But this case is not analogous to pregnancy and abortion.

Levin argues that there is an essential disanalogy between abortion and the unplugging of the violinist. In the case of the violinist (as well as one’s relationship to Fred’s welfare), “the person who withdraws [or withholds] his assistance is not completely responsible for the dependency on him of the person who is about to die, while the mother is completely responsible for the dependency of her fetus on her. When one is completely responsible for dependence, refusal to continue to aid is indeed killing.”

For example, “if a woman brings a newborn home from the hospital, puts it in its crib and refuses to feed it until it has starved to death, it would be absurd to say that she simply refused to assist it and had done nothing for which she should be criminally liable.”23 Just as the withholding of food kills the child after birth, in the case of abortion it is the abortion that kills the child. In neither case is there any ailment from which the child suffers and for which highly invasive medical treatment (with the cooperation of another’s bodily organs) is necessary in order to cure this ailment and save the child’s life.

Or consider the case of a person who returns home after work to find a baby at his doorstep (as was the case in the film Three Men and a Baby, starring Tom Selleck, Ted Danson, and Steve Guttenberg). Suppose that no one else is able to care for the child, but this person only has to care for the child for nine months. (After that time a couple will adopt the child.) If we assume with Thomson that the fetus is as much a person as you or me, would “withholding treatment” (i.e., nourishment and protection) from this child and its subsequent death be justified on the basis that the homeowner was only “withholding treatment” from a child who could not benefit him, and for whom he did not ask? Is any person, born or unborn, obligated to sacrifice his life because his death would benefit another person?

Is it accurate to think of abortion as the withholding of support or treatment? Professors Schwarz and R. K. Tacelli make the important point that although “a woman who has an abortion is indeed ‘withholding support’ from her unborn child….abortion is far more than that. It is the active killing of a human person — by burning him, by crushing him, by dis­membering him.”24 Euphemistically calling abortion the “withholding of support or treatment” makes about as much sense as calling suffocating someone with a pillow the withdrawing of oxygen.

(4) Thomson’s argument ignores family law. Thomson’s argument is inconsistent with the body of well-established family law, which presupposes parental responsibility of a child’s welfare. And, of course, assuming as Thomson does that the unborn are fully human, this body of law would also apply to parents’ responsibility for their unborn children. According to legal scholars Dennis J. Horan and Burke J. Balche, “All 50 states, the District of Columbia, American Samoa, Guam, and the U.S. Virgin Islands have child abuse and neglect statutes which provide for the protection of a child who does not receive needed medical care.” They further state that “a review of cases makes it clear that these statutes are properly applied to secure emergency medical treatment and sustenance (food or water, whether given orally or through intravenous or nasogastic tube) for children when parents, with or without the acquiescence of physicians, refuse to provide it.”25 Evidently, “pulling the plug” on a perfectly healthy fetus, assuming that it is a human person, would clearly violate these statutes.

In a case in New York, for example, the court ruled that the parents’ actions constituted neglect when they failed to provide medical care to a child with leukemia: “The parent…may not deprive a child of lifesaving treatment, however well-intentioned. Even when the parents’ decision to decline necessary treatment is based on constitutional grounds, such as religious beliefs, it must yield to the State’s interests, as parens patriae, in protecting the health and welfare of the child.”26 The fact is that the “courts have uniformly held that a parent has the legal responsibility of furnishing his dependent child with adequate food and medical care.”27

It is evident, then, that child-protection laws reflect our deepest moral intuitions about parental and community responsibility and the utter helplessness of infants and small children. These moral scruples are undoubtedly undermined by “brave new notions” of a socially contracted “voluntaristic” family (Thomson’s view). Without such scruples the protection of children and the natural bonds and filial obligations that undergird family life (and, through it, society itself) will become a thing of the past. This seems too high a price to pay for “bodily autonomy.”

(5) Thomson’s argument implies a “macho” view of bodily control, which is inconsistent with true feminism. Some pro-life feminists have pointed out that Thomson’s argument and/or the reasoning behind it, which is supposed to be consistent with feminism, is actually quite anti-feminist.28 In response to a similar argument from a woman’s right to control her own body, one feminist publication asked the question, “What kind of control are we talking about? A control that allows for violence against another human being is a macho, oppressive kind of control. Women rightly object when others try to have that kind of control over them, and the movement for women’s rights asserts the moral right of women to be free from the control of others.” After all, “abortion involves violence against a small, weak and dependent child. It is macho control, the very kind the feminist movement most eloquently opposes in other contexts.”29

Professor Celia Wolf-Devine makes the observation that “abortion has something…in common with the behavior ecofeminists and pacifist feminists take to be characteristically masculine; it shows a willingness to use violence in order to take control. The fetus is destroyed by being pulled apart by suction, cut in pieces, or poisoned.” Wolf-Devine goes on to point out that in terms of social thought…it is the masculine models which are most frequently employed in thinking about abortion. If masculine thought is naturally hierarchical and oriented toward power and control, then the interests of the fetus (who has no power) would naturally be suppressed in favor of the interests of the mother. But to the extent that feminist social thought is egalitarian, the question must be raised of why the mother’s interests should prevail over the child’s….Feminist thought about abortion has…been deeply pervaded by the individualism which they so ardently criticize.30

Despite the recent suggestion in legal scholarship that fetal personhood ought not be the question that determines the morality of abortion, we have seen that if such a move is carried out by the courts the result would be morally and legally disastrous. For this reason, opponents of abortion ought to master the contents of this article and be prepared to engage this old philosophical, though new legal, challenge to human dignity.

Francis J. Beckwith, Ph.D. is Lecturer in Philosophy at the University of Nevada, Las Vegas, as well as Professor at Large, Simon Greenleaf University (Anaheim, CA) and Senior Research Fellow, Nevada Policy Research Institute. He is the author of Politically Correct Death: Answering the Arguments for Abortion Rights (Baker) and co-editor of The Abortion Controversy: A Reader (Jones & Bartlett). He is on the North American editorial board of the journal Ethics and Medicine.

NOTES

1This article, under a different title, was presented at the conference, “The Christian Stake in Bioethics” (May 19-21, 1994), at Trinity Evangelical Divinity School, Deerfield, Illinois. Another version of this article (titled “From Personhood to Bodily Autonomy: The Shifting Legal Focus in the Abortion Debate”) will be published in Bioethics and the Future of Medicine, ed. Nigel Cameron, David Schiedermayer, and John Kilner (Cumbria, UK: The Pasternoster Press, 1995).

2Justice Harry Blackmun, “The 1973 Supreme Court Decisions on State Abortion Laws: Excerpts from Opinion in Roe v. Wade,” in The Problem of Abortion, 2d ed., ed. Joel Feinberg (Belmont, CA: Wadsworth, 1984), 195.

3See, for example, Harold O.J. Brown, Death Before Birth(Nashville: Thomas Nelson, 1977); Francis A. Schaeffer and C. Everett Koop, Whatever Happened to the Human Race? (Old Tappan, NJ: Revell, 1979); and John Warwick Montgomery, Slaughter of the Innocents: Abortion, Birth Control, and Divorce in the Light of Science, Law, and Theology (Westchester, IL: Crossway Books, 1981).

4Robert Wennberg, Life in the Balance: Exploring the Abortion Controversy (Grand Rapids: Eerdmans, 1985).

5Judith Jarvis Thomson, “A Defense of Abortion,” in The Problem of Abortion, 173-87. This article was originally published in Philosophy and Public Affairs 1 (1971): 47-66. All references to Thomson’s article in this article are from the Feinberg book.

6See, for example, R.C. Sproul, Abortion: A Rational Look at an Emotional Issue (Colorado Springs: NavPress, 1990); Randy Alcorn, Pro Life Answers to Pro Choice Questions (Portland, OR: Multnomah, 1992); and F. LaGard Smith, When Choice Becomes God (Eugene, OR: Harvest House, 1990).

7John S. Feinberg and Paul D. Feinberg, Ethics in a Brave New World (Wheaton, IL: Crossway Books, 1993), 66-69.

8Keith J. Pavlischek, “Abortion Logic and Paternal Responsibilities: One More Look at Judith Thomson’s ‘A Defense of Abortion,’” Public Affairs Quarterly 7 (October 1993):341-61.

9Francis J. Beckwith, Politically Correct Death: Answering the Arguments for Abortion Rights (Grand Rapids: Baker Book House, 1993), chapter 7.

10According to her editor, William Parent, in Judith Jarvis Thomson, Rights, Restitution, and Risk (Cambridge: Harvard University Press, 1986), vii.

11Thomson, “A Defense of Abortion,” 174-75.

12Ibid., 174.

13Blackmun, 195.

14Donald Regan, “Rewriting Roe v. Wade,” Michigan Law Review 77 (1979).

15Laurence Tribe, Abortion: The Clash of Absolutes (New York: W. W. Norton, 1990), 135.

16Stephen L. Carter, The Culture of Disbelief: How American Law and Politics Trivialize Religious Devotion (New York: HarperCollins, 1993), 257-58.

17Ruth Bader Ginsburg, “Some Thoughts on Autonomy and Equality in Relation to Roe v. Wade,” University of North Carolina Law Review (1985).

18Justice O’Connor, Justice Kennedy, and Justice Souter in “Planned Parenthood v. Casey (1992),” in The Abortion Controversy: A Reader, eds. Louis P. Pojman and Francis J. Beckwith (Boston: Jones & Bartlett, 1994), 54.

19See In the Best Interest of the Child: A Guide to State Child Support and Paternity Laws, eds. Carolyn Royce Kastner and Lawrence R. Young (n.p.: Child Support Enforcement Beneficial Laws Project, National Conference of State Legislatures, 1981).

20Michael Levin, review of Life in the Balance by Robert Wennberg, Constitutional Commentary 3 (Summer 1986):511.

21Pavlischek, 343.

22Stephen D. Schwarz, The Moral Question of Abortion (Chicago: Loyola University Press, 1990), 118.

23Michael Levin, Feminism and Freedom (New Brunswick: Transaction Books, 1987), 288-89.

24Stephen D. Schwarz and R. K. Tacelli, “Abortion and Some Philosophers: A Critical Examination,” Public Affairs Quarterly 3 (April 1989), 85.

25Dennis J. Horan and Burke J. Balch, Infant Doe and Baby Jane Doe: Medical Treatment of the Handicapped Newborn, Studies in Law and Medicine Series (Chicago: Americans United for Life, 1985), 2.

26In re Storar, 53 N>Y> 2d 363, 380-81, 420 N.E. 2d 64, 73, 438 N.Y.S. 2d 266, 275 (1981), as quoted in ibid., 2-3.

27Horan and Balch, 3-4.

28Although not dealing exclusively with Thomson’s argument, Celia Wolf-Devine’s article is quite helpful. “Abortion and the ‘Feminine Voice,’” Public Affairs Quarterly 3 (July 1989). See also Sidney Callahan, “Abortion and the Sexual Agenda,” Commonweal 113 (25 April 1986); and Janet Smith “Abortion as a Feminist Concern,” in The Zero People, ed. Jeff Lane Hensley (Ann Arbor: Servant, 1983).

29N.a., Sound Advice for All Pro-life Activists and Candidates Who Wish to Include a Concern for Women’s Rights in Their Pro-life Advocacy: Feminists for Life Debate Handbook (Kansas City, MO: Feminists for Life, n.d.), 15-16.

30Wolf-Devine, 86-87.

This is how we need to act in order to get the economy to grow. (Part 23)

The Rahn Curve and the Growth-Maximizing Level of Government

These posts are all dealing with issues that President Obama did not help on in his first term. I am hopeful that he will continue to respond to my letters that I have written him and that he will especially reconsider his view on the following import issue which deals with growing our economy.This is how we need to act in order to get the economy to grow.

How to Get Economy Growing Fast

by Jeffrey A. Miron

Jeffrey Miron is senior lecturer and director of undergraduate studies at Harvard University and Senior Fellow at the Cato Institute. Miron is the author of Libertarianism, from A to Z and a member of Expert Insight.

Added to cato.org on May 26, 2012

This article appeared in CNN.com on May 26, 2012.

In a recent discussion of what his administration might accomplish, Mitt Romney claimed that “by virtue of the policies that we put in place, we’d get the unemployment rate down to 6%, and perhaps a little lower,” over a period of four years.

Is this goal attainable?

It is. Indeed, it is not that tough a task. If the United States avoids new growth-retarding policies, such as the tax hikes scheduled for January 1, the economy’s natural adjustments will lower unemployment substantially. These include downward adjustments in wages, reallocation of job-seekers from slower to faster growing sectors and regions, reduced in-migration plus increased out-migration, and withdrawals from the labor force.

Jeffrey Miron is senior lecturer and director of undergraduate studies at Harvard University and Senior Fellow at the Cato Institute. Miron is the author of Libertarianism, from A to Z and a member of Expert Insight.

 

More by Jeffrey A. Miron

These adjustments do not always work quickly or for everyone (not every former construction worker can become a computer technician). But history suggests the adjustments do occur, as they have since the recession began. Over the next four years, they will continue to lower the unemployment rate, if not to 6%, at least near that territory.

The more important task for either presidential candidate is restoring the economy to its prerecession growth path. Real GDP has historically grown about 3% per year, and major downturns have been followed by strong recoveries. Within two to three years, therefore, output is typically “back where it would have been.”

In this recession, the rapid recovery phase has so far been absent; real GDP is still well below where one would have predicted pre-2008, and with average growth under 3% since the recession ended, the gap grows larger every quarter.

So can Romney, or anyone, get us back to a higher growth rate? Yes. Here is a program that will restore U.S. economic performance:

  • Cancel all the tax increases scheduled to take effect at the end of 2012 and provide tax stability going forward. Make (all) the Bush tax cuts permanent. Repeal the alternative minimum tax. Eliminate the health care law’s increases in the hospital insurance tax. All this will stimulate in the short term and set the stage for long-term growth.
  • Reform the tax code by eliminating the misguided deductions, exemptions, credits and loopholes that distort incentives and reward special interests. These features include big-ticket items like the deductibility of mortgage interest and employer-paid health insurance premiums, plus myriad small but senseless other provisions.
  • Lower the corporate income tax rate. The U.S. corporate tax environment is one of the least business-friendly in the world. Driving investment overseas cannot be good policy.
  • Slow the growth of entitlements. The U.S. can afford a social safety net, but our current programs are not sustainable, even in a robustly growing economy. Everyone should agree, at a minimum, to cuts that are sufficient to prevent these programs — Medicaid, Medicare, and Social Security — from bankrupting the country.
  • Embrace immigration. Despite recent difficulties, the United States is still an attractive destination for those seeking a better life. By expanding immigration for low-skill workers, we restrain labor costs and reduce out-migration of manufacturing and other business. By easing immigration for high-skill workers — many of them trained in the United States at taxpayer expense — we get a return on our investment and retain industrious and innovative people.
  • Scale back military involvements around the world. A strong national defense makes sense, but it must focus on protecting the United States, not paying for Europe’s defense or trying to force democracy down the throats of countries that are not receptive.
  • Cease the campaign against carbon-based fuels. Green energy may have its day, but only when coal, oil and gas become truly scarce. In the foreseeable future, traditional energy is much cheaper, and subsidies for alternative energy are a waste.
  • Stop scapegoating the rich and pretending that tax-hikes on the 1% can balance the budget. Everyone knows the numbers do not add up.
  • Respect capitalism. Anti-business rhetoric, which casts all success as undeserved, and which fails to recognize the improvements in material well-being that result from entrepreneurial success, just drive away talented people and guarantee our economic demise.

If the United States adopts these policies, it will not only attain Romney’s 6% unemployment goal, it will once again be the economic beacon of the world.

What’s wrong with that?