Recent Policy Studies

• Welfare
  

  Wards of the State

  By Bruce Thornton, Hoover Institution
  
  Defining Ideas, 01/16/2013
  

  With the rise of entitlements, we are not only experiencing a crisis of finances, but also a crisis of character. The welfare trends Eberstadt documents in this indispensible book are clearly unsustainable. But as Eberstadt cautions, the enormous wealth of America and the privileged global role of its currency mean this state of affairs can continue for a long time, as the destigmatization of dependence and the demonization of success insidiously eat away at both our massive wealth and our moral capital. As Adam Smith once said, “There is a lot of ruin in a nation.” But sooner or later, the bill will come due, and Americans will no longer be the people who created the richest and most powerful nation in history. They will be just another “nation of takers.”

  
  
  
• Regulation & Deregulation
  

  Politics and the Poor Man’s Plate

  By Henry I. Miller, Drew l. Kershen, Hoover Institution
  
  Defining Ideas, 01/16/2013
  

  This article offers three examples of genetically engineered crops currently or potentially available thanks to some attributes of open source access: virus-resistant papaya, pod borer-resistant cowpea, and vitamin A-enhanced rice (“Golden Rice”). Although all of them have benefited from open access to biotech discoveries, to be sure, all also offer cautionary tales about the irrelevance of intellectual property rights in the face of gratuitous regulatory obstacles. The bottom line is that intellectual property protection verges on the inconsequential when agricultural biotechnology regulation is, to borrow a phrase from the novelist J.K. Rowling, a “twitching pile of catastrophe.”

  
  
  
• National Security
  

  Hagel, Kerry, and Brennan Senate Confirmation Hearings: U.S. Strategic Forces

  By Baker Spring, Michaela Bendikova, The Heritage Foundation
  
  Issue Brief, 01/16/2013
  

  The forthcoming confirmation hearings are an important opportunity for the Senate to pose key questions about the direction of American foreign policy under President Obama in his second term. After the first four years of the Obama presidency, the U.S. has grown weaker while the world has become even more dangerous. Investments into strategic capabilities such as nuclear weapons and missile defense will help to protect the country and its allies in the future.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  EFEPA Eliminates Corporate Welfare and Corporate Dependence

  By Nicolas Loris, The Heritage Foundation
  
  Issue Brief, 01/16/2013
  

  In order to end the current inefficient system of picking winners and losers in the energy sector, government policies intervening in the economy should be removed. Removing the targeted tax credits for all energy sources and broadly lowering the tax rate, as Congressman Pompeo’s Energy Freedom and Economic Prosperity Act does, would allow for a more market-based energy economy that benefits economically viable producers and, ultimately, consumers with reliable, affordable energy.

  
  
  
• Monetary Policy/Financial Regulation
  

  Remittance Rules: A Case Study of Regulatory Pitfalls

  By Diane Katz, The Heritage Foundation
  
  Issue Brief, 01/16/2013
  

  The remittance regulations constitute rulemaking at its worst: protracted uncertainty, overly broad strictures that reflect a misunderstanding of the targeted market, and fewer, more costly consumer options. Dozens of experts in the finance industry attempted to warn the Consumer Financial Protection Bureau about the flaws before the rules were finalized. Reflecting no small amount of regulatory arrogance, the agency ignored the input—only to reverse course. Unfortunately, the remittance rules saga is not isolated. Dozens of other Dodd–Frank provisions remain unwritten or stuck in regulatory or judicial limbo, leaving financial institutions and their customers uncertain about their investment and credit options. It is a sorry reminder of how poorly crafted legislation and ill-considered rulemaking have costly consequences.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Environmental Conservation Based on Individual Liberty and Economic Freedom

  By Romina Boccia, Jack Spencer, Robert Gordon, The Heritage Foundation
  
  Backgrounder, 01/16/2013
  

  America’s primary environmental goal should be a cleaner, healthier, and safer environment for current and future generations. Yet, governing environmental laws have strayed far from intended purposes, and their implementations are imposing immense costs on Americans with few benefits in return. Too often they impose mandates, empower and enlarge ineffective bureaucracies, and cripple the efforts of free people to more effectively steward America’s environment and natural resources. The Heritage Foundation’s Environmental Conservation: Eight Principles of the American Conservation Ethic offers specific reforms for today’s challenges and principles to guide future policy decisions.

  
  
  
• Monetary Policy/Financial Regulation
  

  Mortgage Regulation: Is CFPB Qualified?

  By Diane Katz, David C. John, The Heritage Foundation
  
  Issue Brief, 01/16/2013
  

  The Consumer Financial Protection Bureau and its allies characterize the new mortgage rules as much-needed protection for vulnerable consumers imperiled by unscrupulous lenders. In reality, many borrowers were irresponsible in assuming more debt than they could possibly repay. Rather than protect unwitting homebuyers, the new rules will foreclose loan options and raise mortgage costs.

  
  
  
• Budget & Taxation
  

  Fiscal Cliff Deal Extends Wasteful Farm Subsidies

  By Emily Goff, The Heritage Foundation
  
  Issue Brief, 01/16/2013
  

  A fiscally prudent farm bill would have reformed the $85.2 billion food stamps program and eliminated or at least reduced commodity and crop insurance subsidies. The current extension, however, is preferable to the two traditional five-year bills passed by the Senate and reported out of the House Agriculture Committee, which would lock in nearly $1 trillion in taxpayer spending over 10 years. The extension continues many long-standing agriculture programs, including direct payments and dairy subsidies, which amount to a raw deal for taxpayers and consumers. Both waste money, distort crop prices, and increase food costs. In the coming months, Congress should focus on reforms essential to reining in spending and commodity price distortions while also decoupling food stamps and other nutrition programs from farm subsidies and returning food stamps to pre-recession levels.

  
  
  
• Budget & Taxation
  

  The Role of GSEs in the Housing Market

  By John L. Ligon, David B. Muhlhausen, The Heritage Foundation
  
  Issue Brief, 01/16/2013
  

  The estimated results in recent Heritage studies provide additional insight and evidence that government-sponsored enterprises should not be part of the path to a new mortgage market. Eliminating Fannie Mae and Freddie Mac could save billions of taxpayer dollars in the U.S. mortgage market through eliminating the subsidy that has induced U.S. households to take on more debt-related consumption, ending up underwater. Indeed, many households were never in a position to handle such debt; therefore, subsidizing them to become homeowners is not only inconsequential in raising homeownership but also detrimental to the financial market. More important, the results of our studies suggest that the effects of removing these subsidies would be minimal and predictable both on the U.S. housing market and on the overall economy.

  
  
  
• Education
  

  Head Start Impact Evaluation Report Finally Released

  By Lindsey Burke, David B. Muhlhausen, The Heritage Foundation
  
  Issue Brief, 01/15/2013
  

  President Obama has pledged to use only one test when determining which education programs to fund: “It’s not whether an idea is liberal or conservative,” Obama stated, “but whether it works.” HHS’s third-grade follow-up evaluation makes it unequivocally clear that Head Start fails that test. HHS has released definitive evidence that the federal government’s 48-year experiment with Head Start has failed children and left taxpayers a tab of more than $180 billion. In the interest of children and taxpayers, it’s time for this nearly half-century experiment to come to an end. If the federal government continues to fund Head Start, policymakers should allow states to make their Head Start dollars portable, following children to a private preschool provider of choice.

  
  
  
• Budget & Taxation
  

  Fiscal Cliff Deal Added $47 Billion in Spending

  By Patrick Louis Knudsen, The Heritage Foundation
  
  Issue Brief, 01/15/2013
  

  The fiscal cliff agreement has a few benefits and many flaws. One trait it does not suffer, however, is “balance”: The agreement allowed for large tax hikes with no spending reductions. Indeed, the measure yields a small but real net spending increase. Today’s trillion-dollar deficits and rising debt are the product of excessive spending. Until Congress and the President take substantial steps toward reining in spending, especially in the government’s entitlement programs, debt will be a constant drain on the country’s prosperity. Having squandered this opportunity, lawmakers need to focus on substantive spending reductions in forthcoming budget debates.

  
  
  
• Budget & Taxation
  

  Legislators’ Guide to the Issues

  By Justin Owen, et al., Beacon Center of Tennessee
  
  Report, 01/10/2013
  

  The 108th General Assembly’s Guide to the Issues provides detailed free market policy recommendations on dozens of issues that will confront legislators in the coming two years.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Water, Water Everywhere but Not a Drop for Power

  By Deborah D. Thornton, Public Interest Institute
  
  Policy Study, 01/10/2013
  

  If the United States and state governments are concerned about renewable energy and global climate change issues caused by power generation from traditional sources such as oil and coal, they must reduce the onerous regulatory environment and increase support for hydroelectric power. Though hydropower is not flashy, with the “pretty” visuals that wind turbines and solar panels have, it is fundamentally a better, more reliable, and more controllable source of energy.

  
  
  
• Budget & Taxation
  

  Effects of Marriage on Tax Burden Vary Greatly with Income Level, Equality

  By Nick Kasprak, Tax Foundation
  
  Fiscal Facts, 01/10/2013
  

  Joint filing has been a source of confusion ever since the filing status was created in 1949. Marriage has the potential to create a significant tax penalty, but it can also lead to a tax bonus in other situations, and for most taxpayers, determining the effect is anything but simple.

  
  
  
• Budget & Taxation
  

  Cigarette Taxes and Cigarette Smuggling by State

  By Joseph Henchman, Scott Drenkard, Tax Foundation
  
  Fiscal Facts, 01/10/2013
  

  Public policies often have unintended consequences that outweigh their benefits. One consequence of high state cigarette tax rates has been increased smuggling, as criminals procure discounted packs from low-tax states to sell in high-tax states. Growing cigarette tax differentials have made cigarette bootlegging both a national problem and a lucrative criminal enterprise.

  
  
  
• Budget & Taxation
  

  CRS Study on Tax Rates and Growth Still Flunks the Test

  By Stephen J. Entin, Tax Foundation
  
  Fiscal Facts, 01/10/2013
  

  Studies issued by the Congressional Research Service are intended to inform the Congress as it develops public policy and enacts legislation. A recent CRS publication on the effect of the top statutory tax rates on economic activity may have influenced the debate over taxing the rich during the election and may have influenced the tax changes just enacted in the fiscal cliff legislation. It is critical that such studies reflect the best guidance that the economics and tax professions can provide. The CRS study on the top tax rates did not meet that high standard. Its original release in the fall was met with widespread and justified disbelief, and it was withdrawn for review and examination of its methodology. It has now been reissued in an updated form. However, the re-issued CRS study does not contain any changes of note that would redeem the original report.

  
  
  
• Budget & Taxation
  

  Income Tax Code No Longer Favors Parking over Transit... For Now

  By Joseph Henchman, Tax Foundation
  
  Fiscal Facts, 01/10/2013
  

  If Congress were to make the tax parity between parking and transit permanent, it might consider a unified exclusion of all transportation commuting expenses. This would resolve the confusing, costly, and long-delayed implementation this year of a 2006 IRS directive that the transit benefit cannot be used for parking at transit stations. Transit agencies have thus been forced to separate out amounts paid by commuters for transit passes from amounts paid for parking at transit stations. A unified exclusion for all transportation commuting expenses would also substitute neutrality for the current arbitrary encouragement of driving over carpooling, transit use, and bicycling.

  
  
  
• Budget & Taxation
  

  Kentucky Tax Reform Commission Offers Disappointing Grab Bag

  By Joseph Henchman, Tax Foundation
  
  Fiscal Facts, 01/10/2013
  

  If fully enacted, the changes recommended by Kentucky’s Blue Ribbon Commission on Tax Reform would increase state revenue by $646 million per year. Some of the recommendations are timely and should be implemented, but overall, the report offers a grab-bag of provisions with little central theme. Taken together, the recommendations would raise income and excise taxes, reduce corporate taxes (primarily for select in-state businesses), and maintain a costly business property tax system with few changes. The merits and implications of this approach are not explained in the report let alone defended as the right policy.

  
  
  
• Budget & Taxation
  

  What Is the Evidence on Taxes and Growth?

  By William McBride, Tax Foundation
  
  Special Report, 01/10/2013
  

  More and more, the consensus among experts is that taxes on corporate and personal income are particularly harmful to economic growth, with consumption and property taxes less so. Economic growth ultimately comes from production, innovation, and risk-taking. This review of empirical studies also establishes some standards by which a tax system may be judged. If we apply these standards to our national tax system, the U.S. has probably the most inefficient tax mix in the developed world. We have the highest corporate tax rate in the industrialized world. If it came down 10 points—still higher than most of our trading partners—it would add 1 to 2 points to GDP growth and likely not lose tax revenue, because the tax base would expand from in-flows of foreign capital as well increased domestic investment, hiring, and work effort.

  
  
  
• Regulation & Deregulation
  

  Sunset Recommendations Would Increase Regulations on Texas’ Electricity Market

  By Bill Peacock, Texas Public Policy Foundation
  
  Policy Perspective, 01/10/2013
  

  The Sunset Commission’s Staff Report recommends the quadrupling of the Public Utility Commission’s fines and restricting due process for Texas businesses. The Staff Report recommends this increased government intervention in the Texas electricity market even though it offers no examples of any problems in the market that need addressing. The Sunset process today is more about increasing the size and scope of government than it is making it more efficient.

  
  
  
• Budget & Taxation
  

  Policy Analytics of the Tax Treatment of Charitable Contributions

  By Benjamin Zycher, Pacific Research Institute
  
  Issue Brief, 01/10/2013
  

  The analytic case for public financial support for private giving is longstanding, comprising four basic observations: underprovision of collective goods by the private sector; underprovision of collective goods by the public sector; distortions in the public provision of collective goods; the strengthening of the institutions of civil society as a buffer between the citizenry and the state. A change in the tax treatment of charitable giving is likely to have significant effects on the level of such giving. Prominent proposals to change the way that the current tax system treats charitable donations would be likely to reduce such giving by $5 billion to $10 billion per year, an effect equal to significant percentages of the operating budgets of major charitable organizations in the U.S. Moreover, the central proposals to reform the U.S. tax system either cannot be reconciled with public support for private charity, or would require changes likely to reduce such giving.

  
  
  
• Health Care
  

  A Mobile Device Is Not Your Grandmother’s Telephone Anymore: It’s A Mobile Health Center

  By Deborah Taylor Tate, Free State Foundation
  
  Perspectives from FSF Scholars, 01/10/2013
  

  New mobile diabetes management devices are freeing patients from the burden of logging their glucose measurements and making remote monitoring a seamless process. My first vote at the FCC in 2006 was for one of these early diabetes predecessors, a step along the unending development of new and better. I still remember the letter from a mom thanking me for no longer having to “prick” her three children six or seven times a day. That letter reminded me every day of the lasting impact regulators can have on maximizing what our scientists and researchers are doing by enabling their discoveries to become real solutions for real people.

  
  
  
• Monetary Policy/Financial Regulation
  

  Dodd-Frank: What It Does and Why It’s Flawed

  By Hester Peirce, James Broughel, Mercatus Center
  
  Book, 01/10/2013
  

  This book paints a fairly bleak picture of Dodd-Frank. Dodd-Frank was presented as a solution to the devastating problems that emerged in 2007 and 2008. It is not that. Certain elements did not relate to the crisis at all. Other provisions could make the financial system more prone to crises.

  
  
  
• Budget & Taxation
  

  The Home Mortgage Interest Deduction

  By Jeremy Horpedahl, Harrison Searles, Mercatus Center
  
  Mercatus on Policy, 01/10/2013
  

  The home mortgage interest deduction is the largest explicit tax deduction for households in the federal income tax code. Politicians have been reluctant to even consider removing this deduction, believing it to be one that provides significant benefits to middle-class taxpayers and encourages homeownership. These benefits are greatly overstated: most taxpayers do not benefit from this deduction at all or receive a very small benefit. The only taxpayers who do receive a large benefit are those in the upper income brackets. Taxpayers and the entire economy would be better served by removing the mortgage interest deduction and lowering marginal tax rates to offset the change.

  
  
  
• Budget & Taxation
  

  Regaining America’s Balance

  By Glenn Hubbard, Tim Kane, National Affairs
  
  National Affairs, 01/10/2013
  

  All great nations fall. And as economic historian Douglass North reminds us, they almost always fall when political institutions reveal their “inherent instability.” But history also shows us that adaptation is possible. Decline can be averted, at least for a time, by leaders who are able to see their way out of the trap of imbalance—out of the prisoners’ dilemmas created by old rules that no longer suit a new set of circumstances. We are in such a trap today. Everybody knows that our current fiscal practices are unsustainable. The question is whether our leaders will figure out in time just how we can escape that trap by rebalancing the rules of how we budget, tax, and spend.

  
  
  
• Economic Growth
  

  Can the American Dream Be Saved?

  By Stuart M. Butler, National Affairs
  
  National Affairs, 01/10/2013
  

  As Niall Ferguson has remarked (reflecting on Tocqueville), “The notion that you could achieve greater social cohesion by increasing the power of the state at the expense of civil society [is] a great illusion.” The answer to our concerns about inequality and mobility is to foster a broad commitment to strengthening the institutions of civil society, particularly the family. It requires local and national leaders to call for a reaffirmation of the virtues of industriousness, honesty, marriage, and religiosity in the communities from which they have been disappearing. The best, and indeed the only fruitful, way for government to participate in this effort is to remove the obstacles and perverse incentives of its own making—and to foster an environment in which our charitable and social institutions are free to form citizens of the high character a great nation demands.

  
  
  
• Monetary Policy/Financial Regulation
  

  Against Casino Finance

  By Eric Posner, E. Glen Weyl, National Affairs
  
  National Affairs, 01/10/2013
  

  A rule known as the “insurable interest doctrine”—which first entered British law by an act of Parliament in 1746, and then became a part of the common law inherited by the American legal system—required that individuals seeking to buy insurance have a stake in the event against which they sought to be insured. A person could not, for instance, purchase a life-insurance policy to bet on the death of the prime minister, but he could purchase life insurance to protect his dependents or buy health insurance to protect himself. The aim was to prevent people from disguising gambling as legitimate insurance transactions. If this rule had been applied to credit default swaps—which are mostly used to gamble on the failure of a debtor rather than to insure against it—the multi-trillion-dollar CDS market would never have formed, and the financial crisis would not have been as severe.

  
  
  
• The Constitution/Civil Liberties
  

  The Sad Irony of Affirmative Action

  By Gail Heriot, National Affairs
  
  National Affairs, 01/10/2013
  

  Constitutional scholars look back at the doll experiments and ask, “What if the children had preferred the black doll?” What if it turned out that the children’s preference for the white doll had nothing to do with low self-esteem caused by Jim Crow segregation? Would that have made the case for Brown v. Board of Education weaker? Should the constitutional right to equal protection turn on the latest social-science research? The answer to these latter questions should be, “Of course not.” The Constitution demands equal protection for all persons regardless of whether they can demonstrate through social-science research that they have been harmed by some law or policy or social practice.

  
  
  
• Welfare
  

  The Unfinished Work of Welfare Reform

  By Robert Rector, Jennifer A. Marshall, National Affairs
  
  National Affairs, 01/10/2013
  

  Reformers have their work cut out for them. They must begin by resolutely opposing the Obama administration’s efforts to dismantle the work requirements in the Temporary Assistance for Needy Families program, which are the heart of the program and the key to the effectiveness of the 1996 reform. The administration’s changes to the program are not only counterproductive, but unlawful. They must not be allowed to stand. And to build on the successes of welfare reform and regain the initiative, reformers should pursue a three-part agenda. First, workfare must be expanded to other means-tested programs like food stamps and public housing. Second, the overall costs of all our ballooning welfare programs must be controlled through a cap on aggregate spending. Third, serious attention must be paid to the crisis of unwed parenting that drives so much of today’s poverty.

  
  
  
• Economic Growth
  

  The Dangers of Quasi-Capitalism

  By Howard Husock, National Affairs
  
  National Affairs, 01/10/2013
  

  Quasi-capitalists are right that markets cannot meet all needs — especially the needs of individuals who lack the skills and habits to participate in those markets. They are profoundly wrong, however, to assert that the fruits of private enterprise are solely private, and that traditional capitalism meets no social needs at all. Our system of free enterprise has, over the years, evolved to produce broad prosperity and high standards of living unimaginable for most of human history. Should the quasi-capitalists succeed in undermining or supplanting the structures that have made those benefits possible, they will surely harm the very people and causes they claim to help — not to mention the rest of society. Quasi-capitalism thus presents a very real threat to our innovative economy and dynamic way of life. We fail to take it seriously at our own peril.

  
  
  
• Economic Growth
  

  Innovation and Inequality

  By John O. McGinnis, National Affairs
  
  National Affairs, 01/10/2013
  

  Our political debates about equality and fairness are too often argued using an obsolete vocabulary. Differences in income tell us less than they once did about differences in people’s real standards of living. And the immense potential of technology to reshape the lives of the rich and the poor simultaneously has yet to be fully understood and accounted for. Even when we set out to examine technology and inequality together, we too often get things backwards, considering the effects of technology in terms of who has the money to access it. In reality, the most significant technologies of the past half-century have tended to make money less rather than more important, and have been available more widely, more quickly, than such valuable commodities have ever been before.

  
  
  
• Economic Growth
  

  Becoming Europe: Economic Decline, Culture, and How America Can Avoid a European Future

  By Samuel Gregg, Encounter Books
  
  Book, 01/10/2013
  

  In Becoming Europe, Samuel Gregg uses the idea of economic culture – the values and institutions – that inform our economic priorities to explain how European economic life has drifted in the direction of what Alexis de Tocqueville called “soft despotism”, and the ways in which similar trends are manifesting themselves in the United States. America, Gregg argues, is not yet Europe. Economic decline need not be its future. The good news is that the path to recovery lies deep in the distinctiveness of American economic culture. But there are ominous signs that some of the cultural foundations of America’s historically-unparalleled economic success are corroding in ways that are not easily reversible and for which the European experience should serve as the proverbial canary in the mine shaft.

  
  
  
• Regulation & Deregulation
  

  Off-Label, Not Off-Limits: The FDA Needs To Create a Safe Harbor For Off-Label Drug Use

  By Paul Howard, James Copland, Manhattan Institute
  
  Issue Brief, 01/10/2013
  

  By far the most serious consequence of the Food and Drug Administration’s onerous limitations on off-label drug promotion, amplified by the heavy hand of federal criminal law, is the regime’s adverse impact on public health. Simply put, limiting companies’ ability to communicate with doctors about new advances in medicine serves patients poorly. Given that the FDA is unlikely to streamline its procedures anytime soon, it should at least work to facilitate the communication of the best science available to doctors and other learned intermediaries. Scientific knowledge could be captured and disseminated much better by a “safe harbor” on off-label drug use and promotion that recognizes that patients and physicians are collaborators in developing information on when a drug works (or doesn’t work), and for whom.

  
  
  
• Transportation/Infrastructure
  

  Funding Important Transportation Infrastructure In a Fiscally Constrained Environment

  By Robert Poole, Reason Foundation
  
  Policy Brief, 01/10/2013
  

  America has very real needs to upgrade and modernize transportation infrastructure, but the reality going forward is that federal general fund subsidies will no longer be available. Major changes in federal policy will be needed to empower states and the private sector to meet the needs for capital investments in transportation infrastructure in this new environment of a smaller federal role. In making these changes, Congress has an unusually good opportunity to increase the productivity of these capital investments via changes that reduce or eliminate cross-subsidies between users and among states. This brief’s proposed federal policy changes fall into three broad categories: organizational changes, tax changes and regulatory changes.

  
  
  
• Transportation/Infrastructure
  

  Parks 2.0: Operating State Parks Through Public-Private Partnerships

  By Leonard Gilroy, Harris Kenny, Julian Morris, Reason Foundation
  
  Studies, 01/10/2013
  

  One way to keep state parks open without imposing additional burdens on the taxpayer is to utilize public-private partnerships (PPPs). Many states already successfully use private concessionaires to provide piecemeal services within parks—including food, retail, lodging, marinas, and other commercial activities—so a shift to more extensive involvement can build on that. Such a whole park operation PPP would transfer the responsibility of maintaining the park to a private operator, while enabling that operator to raise revenue through entrance and other fees. The U.S. Forest Service has used this PPP model for over 25 years to operate thousands of its developed recreation areas nationwide, and in 2012 California began the first state to turn over the operation of state parks to private recreation management companies to avoid closure.

  
  
  
• Family, Culture & Community
  

  India’s Missing Women

  By Michael Auslin, American Enterprise Institute
  
  The American, 01/10/2013
  

  India is indeed changing, though unevenly. Nearly everyone I talk with, male or female, stresses that India must build up its national strength, meaning its economy. All the young women I meet are part of that strength, yet many will undoubtedly drop out of the work force. Society itself doesn’t seem to be the hindrance as much as entrenched social mindsets and the powerful pull of the family unit. Qualified women appear more likely to be restrained at home than openly discriminated against at the employment office. For hundreds of millions of poorer women, moreover, change in India is coming all too slowly, if at all. As it looks ahead to becoming a great power, how to assure all women have more of a say in shaping their lives will be one of India’s greatest challenges. Perhaps education will be the key, or the voices of prominent female leaders like Sonia Gandhi.

  
  
  
• Monetary Policy/Financial Regulation
  

  Central Bank Dreams, Monetary Realities

  By Alex J. Pollock, American Enterprise Institute
  
  The American, 01/10/2013
  

  The key institutions in the post-1971 financial world are governments, which have increasingly used permanent deficit financing; central banks which issue, against the governments’ debt they buy, irredeemable paper currencies (accompanied by coins which clunk instead of ringing if you drop them on a table); and commercial banks which issue deposits redeemable only in the central banks’ fiat currencies. This arrangement has resulted in the general acceptance of permanent inflation and the redefinition of “price stability” to mean a more or less stable rate at which the purchasing power of the fiat currency depreciates (a pretty remarkable example of Newspeak). It is a sobering thought that this entire system depends on trusting the foresight, wisdom, and knowledge of the managers of the key institutions.

  
  
  
• Economic Growth
  

  2013 Index of Economic Freedom

  By Terry Miller, et al. , The Heritage Foundation
  
  Book, 01/10/2013
  

  Countries with higher levels of economic freedom substantially outperform others in economic growth, per capita incomes, health care, education, protection of the environment, and reduction of poverty, according to data collected for the 2013 Index of Economic Freedom. Regrettably, the results also indicate that economic freedom is not advancing strongly. Only 31 countries have increased their economic freedom scores by 1 point or more over the past year, and 35 registered declines of that magnitude. The average world economic freedom score increased only 0.1 point, reflecting policy stagnation that in turn is reflected in lower world growth rates. Government spending scores improved somewhat on average, heralding serious efforts in many countries to halt the rapid budget growth that accelerated during the financial crisis and recession. By contrast, regulatory efficiency declined as countries attempted to stem growing unemployment by increasing minimum wages or otherwise tightening labor market controls.