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InsiderOnline Blog: May 2012

TARP Was Supposed to Be Temporary; What Happens to Obama’s “Frugality” When You Don’t Count That?

“It turns out that Obama’s supposed frugality is largely the result of how [the Troubled Asset Relief Program] is measured in the federal budget. To put it simply, TARP pushed spending up in Bush’s final fiscal year (FY2009, which began October 1, 2008) and then repayments from the banks (which count as ‘negative spending’) artificially reduced spending in subsequent years. [Daniel J. Mitchell, Cato-at-Liberty, May 29]

Posted on 05/31/12 11:39 PM by Alex Adrianson

Government Plays by Its Own Rules: No FDA Oversight for Agency Promoting “Comparative Effectiveness”

“If you’ve spent a billion dollars on a new drug, you have an interest in touting it as vastly better than the drug that preceded it. But if you have an interest in saving a billion dollars — and the U.S. government, as the world’s largest payer for health care, most certainly has such an interest — then surely you have a corresponding incentive to recommend cheaper treatments. […]

“There is always a trade-off between care and cost, but that trade-off keeps changing as medicine advances. What’s crazy expensive today could be far cheaper in five years’ time, and it could trigger further incremental breakthroughs in treatment.

“A glance at the [Agency for Healthcare Research and Quality]’s link-heavy website shows that a lot of its reports are already old, while the billion dollars it got from Congress has yet to deliver any major new findings. This isn’t particularly surprising: Comparative effectiveness research takes time. But what if the eventual results end up being out of date — or get challenged as critically flawed? What will a government ‘comparative effectiveness’ health rep say in such cases?

“Again, we don’t know, because the government doesn’t think it needs to regulate itself as a provider of health care research and purchaser of health care.” [Trevor Butterworth, The Daily, May 29]

Posted on 05/31/12 10:09 PM by Alex Adrianson

A New Survey of Business Climate Takes a Novel Approach: Asking the Businesses

“Working with the Kauffman Foundation, Thumbtack conducted a large-scale survey of listed businesses on ‘Small Business Friendliness’ by state. Instead of measuring states by the ideology-driven criteria of a ranking report, the Thumbtack survey simply asked, ‘How would you rate your state’s support of small business owners?’ The findings are highly intriguing.

“For overall small business friendliness, the top states are Idaho, Texas, Oklahoma, and Utah, which accords generally with other state rankings. The top cities followed this pattern, with Oklahoma City, Dallas-Fort Worth, San Antonio, and Austin topping the list. […]

“What is most important about the Thumbtack survey is that it does not restrict itself to general findings by state or city. Instead, for each state it offers an entire menu of grades: Ease of starting a business; cost of hiring; friendliness of zoning regulations; publicity of networking programs; and several more. […] Further, Thumbtack offers a regional breakdown by grade and business location within each state. […]

“Most interestingly, for each state and regional location within the state, Thumbtack provides selected comments by business owners. This qualitative feedback underscores both the specific challenges facing entrepreneurs (paperwork, finance) and the business-to-business variation within states.” [Dane Stangler and Yasuyuki Motoyama, The American, May 30]

Posted on 05/31/12 07:26 PM by Alex Adrianson

Competitive Federalism at Work

Maryland accounted for the largest taxpayer exodus of any state in the region between 2007 and 2010, with a net migration resulting in 31,000 residents having left the state. Where did most of them go? VirginiaVirginia is now home to nearly 11,500 former Marylanders—a shift of $390 million from the tax rolls of one state to another, according to the non-partisan Tax Foundation.

“That’s the position Maryland finds itself in after six years of damaging tax increases. Since 2007, taxes and fees have been raised 24 times, taking an additional $2.4 billion out of the economy each year. That explains why two states with similar economies, demographics, and a shared dependence on federal government employment and procurement sharply diverge in job growth. Maryland’s unemployment rate is a full point higher than Virginia’s and just last month the state led the nation in job loss, according to the Labor Department’s April numbers.” [Larry Hogan, Reason, May 30]

Posted on 05/31/12 12:31 PM by Alex Adrianson

Defenders of Public Pensions Use Bad Accounting to Understate Their Costs; Here’s One Example

“[A] recent analysis of public-sector compensation in New Jersey, published by the Economic Policy Institute, reported that public employees in New Jersey received pension-related compensation equal to about 10.9 percent of their wages in 2009. However, the 10.9 percent figure merely reflects New Jersey’s annual contribution to its pension plan, without regard to the actual benefits that the state’s public workers accrued that year.

“[…] But the state assumes the plan will earn 8.25 percent per year in interest, which is much higher than what a private-sector worker could achieve with a safe investment.

“Using the risk-adjusted discount rate of 4 percent in place in 2009, the normal cost of New Jersey pensions rises to approximately 34.1 percent of wages, which, net of the 5.5 percent employee contribution, generates pension-related compensation equal to 28.6 percent of wages. In other words, the true cost of New Jersey pension benefits in 2009 was more than two and a half times higher than implied by the ‘whatever the government puts into its pension fund’ method. […] By contrast, [defined-contribution] benefits to New Jersey workers in large private firms were approximately 3.9 percent of wages in 2009. [Internal citations omitted.] [Jason Richwine, The Heritage Foundation, May 31]

Posted on 05/31/12 11:29 AM by Alex Adrianson

Most Individual Buyers Will Have to Buy Pricier Health Insurance to Meet ObamaCare Standards

“[T]he majority of Americans with individual insurance coverage today are enrolled in a plan whose actuarial value is too low to qualify for a state-based exchange. Insurance reforms that went into effect September 23, 2010, raised the financial protection offered by exchange plans. For example, lifetime maximum benefits were eliminated, effective preventive services must now be offered without cost sharing, and annual limits on insurance coverage were removed. But to qualify for exchanges, insurers will need to lower the average deductible level for individual tin plans, which today average nearly $3,900 for a single person.” [Jon R. Gabel, et al., Health Affairs, May 2012]

Posted on 05/30/12 06:27 PM by Alex Adrianson

Economies Grow Faster When Government Is Smaller

“Econometric analysis of advanced [Organisation for Economic Cooperation and Development] countries for the period 1965-2010 finds that a higher tax to [Gross Domestic Product] ratio has a statistically significant, negative effect on growth. For example, an increase in the tax to GDP ratio of 10 percentage points is found to lower annual per capita GDP growth by 1.2 percentage points. […]

“Between 2003 and 2012, real GDP growth was 3.1% a year for small government countries (i.e. where both government outlays and receipts were on average below 40% of GDP for the years 1999 to 2009), compared to 2.0% for big government countries.

“There is little evidence that small government countries have worse social outcomes: Health outcomes are mixed: in the past 10 years, life expectancy in small government countries has been higher than in big government countries. Infant mortality has been lower in big government countries. Statistical evidence from the last 10 years suggests that small government countries achieve higher academic outcomes.” [Ryan Bourne and Thomas Oechsle, “Small Is Best: Lessons from Advanced Economies,” Centre for Policy Studies, May 2012]

Posted on 05/29/12 05:49 PM by Alex Adrianson

Tuesday, May 29 Is Tax Freedom Day in the UK

“The Adam Smith Institute has calculated that, for 149 days of the year, every penny earned by the average UK resident will be taken by the government in tax. This year’s Tax Freedom Day falls two days later than it did in 2011. […]

“The double-dip recession, the VAT increase from last year, our high personal taxes, as well as fuel duty and stealth taxes, all mean that the government is taking a larger share of our hard-earned income. Britain’s tax burden is still too high and tax cuts are desperately needed to boost economic growth.

“This year’s corporation tax receipts are a good example of how tax cuts can pay for themselves. There were large increases in tax revenue from onshore corporation tax, coinciding with the government’s cuts to the headline rate of corporation tax. Reductions in the corporation tax rate have brought the government higher revenues as more companies choose to invest in the UK. By stimulating growth and investment, tax cuts really can pay for themselves.

“However, our Tax Freedom Day still falls long after the USA’s, on April 17th and Australia’s, on April 4th. Our only comfort is that our tax burden isn’t quite as high as France’s, which will have to wait until July to celebrate its own Tax Freedom Day.” [Adam Smith Institute, May 29]

Posted on 05/29/12 02:15 PM by Alex Adrianson

Licensure v. Free Speech

North Carolina wants to stop Steve Cooksey from writing advice columns based on his success with his caveman diet. The Institute for Justice is helping him defend his First Amendment Rights:

Posted on 05/29/12 01:50 PM by Alex Adrianson

Cutting Government Spending Hasn’t Led to the Doom Predicted by Keynesians

“The green regression line highlights the most important takeaway from this chart: that there is no obvious relationship between a decrease in government spending and a decrease in GDP. Keynesians would expect the line to slope upward; in fact, it slopes slightly downward. But the slope of the line is not significantly different from zero […] .

“The chart has two policy implications. First, austerity has not caused even near-term harm to countries that have undertaken it. Second, austerity is something of a free lunch. This is because, as studies (such as a 2010 paper by economists Andreas Bergh and Martin Karlsson) show, longer-run growth is higher in countries with smaller governments. Nations that reduce spending today can do so without fearing that the longer-run growth is being purchased with a costly near-term recession.” [Kevin A. Hassett, American Enterprise Institute, May 25]

Posted on 05/29/12 11:15 AM by Alex Adrianson

To Do: Promote Accountability, Honor our Founding Document

• Nominate someone for a Breitbart Award—today! To inspire more of the heroic work that Andrew Breitbart had only begun, The Heritage Foundation and the Franklin Center for Government and Public Integrity have started the Breitbart Awards, which will recognize individuals who make outstanding contributions in exposing the corruption, holding government accountable, and spreading the ideas of liberty. Three awards will be given annually, one for a professional journalist, one for a blogger, and one for a citizen. Hurry with your nominations; the deadline is today (Friday).

• Book a seat for the fifth anniversary of the dedication of the Victims of Communism Memorial. The event, which honors the memory of the 100 million victims of worldwide Communism, will be held June 12 at 10 a.m., at the Victims of Communism Memorial (Massachusetts Avenue, NW and New Jersey Avenue, NW in Washington, D.C.).

• Help make the police accountable by checking out and giving your feedback to the new Cato Institute Web site, The site gathers news reports about police misconduct in the United States, as well as explores ideas for reforms that will minimize police misconduct. You can also report an incident of police misconduct to the site’s editors.

• Read up on the Founders, their ideas, and the Constitution they wrote. Today (Friday) is the 225 anniversary of the start of the Constitutional Convention in Philadelphia, so go explore The Heritage Foundation’s First Principles Web site to learn more about the country’s Founding.

Posted on 05/25/12 11:33 AM by Alex Adrianson

Toolkit: Use LinkedIn to Get the Right Policy Job

The less exciting slice of the social media pie might be LinkedIn. However, it’s likely the most beneficial for someone using social networking to climb the career ladder. If the professional field is all about “who you know,” LinkedIn makes it possible to “know” a whole lot more people. A simple online “link” via this growing online community could be your ticket to landing a prime job interview.

Many are overwhelmed at the prospect of managing another social network but you’d be wise to pay attention to this one. Chances are you already have an account but aside from the basics, how can you utilize LinkedIn more effectively? Here are a few tips to get started and make the most of your LinkedIn experience:

Profile: It’s best to fill out your profile fully and completely. Be sure to give thorough job descriptions, skills, and accomplishments. A good, professional-looking photo is key. The summary you give should be as proofed and professional as a cover letter for your dream job. Companies scour LinkedIn for good candidates and if they find you but see a massive mistake, you will never know the opportunity you missed. Additionally, be sure to fill out phone number (if you are comfortable), email address, Twitter handles, and additional contact possibilities.

Connections: LinkedIn offers basic searches through your contacts on Google, which will give you a good base from which to start. From there, the Web site will offer a constant stream of possible new connections. You may see names you haven’t thought about in a long time, as it even collects information from an email you sent to one person one time. Believe it or not, that can actually be quite helpful in building a broad list. LinkedIn’s algorithm finds possible interests based on your initial contact list, as well, giving you plenty of industries and people to choose from.

Groups: LinkedIn’s group feature takes your search for connections to a more intimate level. You can join groups with other professionals in your field; and find experts to answer your questions, and peers to share advice and strategy. You will likely find more than one group that meets your needs. There are alumni groups, career groups, and more ones for more specialized interests.

Recommendations: Contact several people from your previous and current jobs. Ask them to submit short, thoughtful recommendations that showcase your skill set and work ethic. These can be key to showing potential employers what you are made of.

Search: If you use LinkedIn for a current job search, you are in luck. It’s possible to apply for jobs on the network because employers trust this site. That’s in your favor! You’ll need to go to the “jobs” tab for options. There, you can perform targeted searches, review results, and save them for later. You can be sure that many companies are paying to advertise prime jobs on LinkedIn so do yourself a favor and utilize the many things LinkedIn has to offer.

—Ericka Andersen

Posted on 05/25/12 10:45 AM by Alex Adrianson

Read Hayek to Understand the Impending Euro Collapse

“Contrary to much misunderstanding, Hayek never argued that the slightest deviation from laissez-faire capitalism launches a society on an unstoppable march toward tyranny. Instead, he reasoned that tyranny is the inevitable result of government policies aimed at preventing market competition from ever threatening anyone’s economic prospects. As long as voters demand that government protect them from all downsides of economic change, governments can oblige them only by shutting down, one after another, all avenues for economic change. Competition; entrepreneurship; innovation; consumer sovereignty; workers’ freedom to change or to quit their jobs; even changes in demographics. Government must obliterate these and all other sources of change if no one is to be exposed to the risk of losing a job or of having her wages or benefits cut.

“Obviously, in reality governments cannot produce such a petrified paradise. But in the course of trying they will create hell on earth unless people come to accept the fact that widespread material prosperity is impossible without genuine change – and that change is impossible without some people suffering economic disappointment.

“The Greeks – and, indeed, all of us – would be wise to learn this lesson ASAP.” [Don Boudreaux, Cafe Hayek, May 24]

Posted on 05/25/12 01:44 AM by Alex Adrianson

Pakistan Thinks Helping to Locate Terrorists Is Treason (Which Might Explain a Few Things)

“A Pakistani doctor who helped the Central Intelligence Agency pin down Osama bin Laden’s location under the cover of a vaccination drive was convicted on Wednesday of treason and sentenced to 33 years in prison, a senior official in Pakistan said.

“A tribal court here in northwestern Pakistan found the doctor, Dr. Shakil Afridi, guilty of acting against the state, said Mutahir Zeb Khan, the administrator for the Khyber tribal region. Along with the prison term, the court imposed a fine of $3,500. Dr. Afridi, who may appeal the verdict, was then sent to Central Prison in Peshawar. […]

“In Washington, Obama administration officials expressed anger and frustration at the tribal court’s decision, but indicated that American officials were working quietly behind the scenes to shorten the sentence or have it dismissed.” [Ismail Khan, New York Times, May 23]

Posted on 05/25/12 01:30 AM by Alex Adrianson

The Senate Has More Important Things to Do Than Pass a Budget

“The Senate on Wednesday quickly approved legislation that would remove the word ‘lunatic’ everywhere it appears in the federal code.” [Pete Kasperowicz, The Hill, May 23]

Posted on 05/25/12 01:18 AM by Alex Adrianson

The Small Business Administration Practices Its Own Kind of Crony Capitalism

“[C]ompanies with hundreds or even thousands of employees (depending on the industry) are also eligible for benefits and other preferences; they win the coveted designation by virtue of the fact that they are small relative to other firms in their industry. Based on the federal government’s bizarre classifications, 99.7 percent of firms in America qualify as small. […]

“The ubiquitous statistic that small businesses create 70 percent of all net new jobs is also misleading. […] [T]o arrive at this figure, the [Small Business Administration] divides net small business jobs—a figure that includes every single current employee of a small business—by the net job creation from all businesses combined. This is not an accurate way to determine the share of new jobs created by small businesses.

“The results can be comical: One table published by the SBA in 2005 showed that small businesses created more than 100 percent of new jobs, a truly heroic (if fantastical) result. […]

“Real job growth comes not from people dreaming of being small but from entrepreneurs committed to building large and sustainable companies. This shouldn’t be news. A seminal 1987 study by David L. Birch, a former MIT researcher, explained that small-firm job creation occurs within a relatively few firms, the ones he calls ‘gazelles.’ Gazelles are high-growth entrepreneurial companies that start small and quickly grow larger.” [Veronique deRugy, Reason, June 2012]

Posted on 05/25/12 12:26 AM by Alex Adrianson

Giving the Germans’ Credit Card to the Greeks Hasn’t Been a Good Idea So Far

“As Michael Lewis showed in his book ‘Boomerang,’ Greece needs massive corrective measures just to return to the range of how normal countries operate. By longstanding tradition, tax evasion is a way of life: Two-thirds of doctors reported income of less than 12,000 euros, below which no income tax is owed. Serious enforcement would mean putting every doctor in Greece in prison, a knowledgeable observer informed Lewis. Many workers have enjoyed retirement and state pensions as early as age 50 or 55.

Despite having one of the lowest education rankings in Europe, pre-austerity Greece employed four times as many teachers per capita as Finland, which has the best. A state railroad system is so badly run that an economist calculated it would be cheaper for the government to simply pay for cab rides for everyone.” [Kyle Smith, New York Post, May 19]

Posted on 05/24/12 11:34 PM by Alex Adrianson

New Consumer Protection Law Protects Consumers from Getting the Credit

“The [Credit Card Accountability, Responsibility, and Disclosure Act] is widely interpreted as prohibiting millions of stay-at-home moms (and a few dads) from obtaining credit cards of their own altogether—just like the 1950s. That’s because the ‘ability to pay’ regulation requires credit card applicants to have an independent source of income to open an account, or else find a co-signer. […]

“Credit card companies long ago realized that homemakers make the majority of household purchases—lack of a paycheck notwithstanding. A variety of studies also document that women take fewer financial risks than men, giving them a slight edge on the reliability scale. So, naturally, Congress has made it much more difficult for those with better credit odds to obtain credit. […]

“Just how the provision squares with marital property laws in some states is unsettled. Meanwhile, some 45,000 outraged moms (and a few dads) signed a petition of protest that has been delivered to the Consumer Financial Protection Bureau. A senior spokeswoman there told Forbes, ‘Concerns about how the rule may be affecting stay-at-home spouses have been brought to our attention and we are studying the issue.’” [Diane Katz, The Foundry, May 22]

Posted on 05/24/12 10:50 PM by Alex Adrianson Says Obama Spending up Only 1.4 Percent Yearly; and Here’s the Rest of the Story

“[Rex] Nutting arrives at that 1.4% number by assigning 2009—when spending surged nearly 20%—to George W. Bush: ‘The 2009 fiscal year, which Republicans count as part of Obama’s legacy, began four months before Obama moved into the White House. The major spending decisions in the 2009 fiscal year were made by George W. Bush and the previous Congress. Like a relief pitcher who comes into the game with the bases loaded, Obama came in with a budget in place that called for spending to increase by hundreds of billions of dollars in response to the worst economic and financial calamity in generations.’

“Let me complete the metaphor for Nutting: ‘Then as those runners scored, Obama kept putting more on base.’

“Obama chose not to reverse that elevated level of spending; thus he, along with congressional Democrats, are responsible for it. Only by establishing 2009 as the new baseline, something Republican budget hawks like Paul Ryan feared would happen, does Obama come off looking like a tightwad. Obama has turned a one-off surge in spending due to the Great Recession into his permanent New Normal through 2016 and beyond.” [James Pethokoukis, The American, May 23]

Posted on 05/24/12 10:19 PM by Alex Adrianson

Disaster Inflation Gives Feds More Power; FEMA Uses Faulty Metric to Determine If States Need Help

“Beginning in 1999, [the Federal Emergency Management Agency] agreed to adjust the statewide per capita indicator amount annually based on the [Consumer Price Index]. However, FEMA did not adjust the per capita indicator amount for changes in income or purchasing power from 1983 to 1999. By not adjusting the per capita amount for 16 years, FEMA’s calculations did not take into account a 142% percent increase in per capita income and a 65% percent increase in the CPI. […]

“More than 36% of the [Preliminary Damage Assessments] would not have exceeded the States’ indicators if the $1 per capita amount had been indexed back to the change in the CPI since 1983. If FEMA had updated its 1983 national per capita income of $1 to reflect 2009 and 2010 national per capita income, more than 56% of PDAs would not have exceeded the indicator.” [Department of Homeland Security Office of the Inspector General, “Opportunities to Improve FEMA’s Public Assistance Preliminary Damage Assessment Process,” May 2012]

Posted on 05/23/12 04:11 PM by Alex Adrianson

State Wants $180,000 in Taxes for One Visit

“Based on one visit over a seven-year period, [the state of Washington] decided that my company, Sage V Foods, should be required to pay business and occupation taxes. Washington made that determination even though Sage V Foods has no employees, no property, no sales offices and no inventory in the state – nothing. […]

Washington has a sneaky way of catching companies in its tax trap. A few weeks after one of our trucks stopped at a weigh station during a routine delivery, we received a questionnaire in the mail from the Department of Revenue. The letter seemed innocuous enough, but it absolutely wasn’t.

“It asked whether one of our employees visited the state once a year for business purposes. We answered yes, that was possible, and Washington pounced. It audited us and imposed seven years’ worth of taxes, interest and penalties. Washington claims Sage V Foods has a substantial connection to the state because we, on very rare occasions, cross its borders to do business. That’s outrageous.” [Pete Vegas, Washington Times, May 15]

Posted on 05/23/12 02:10 PM by Alex Adrianson

The Real Costs of ObamaCare’s 2.3 Percent Excise Tax on Medical Devices Are Very Large

“Because incentives to invest in the research and development of new medical technologies are driven by perceived returns, the excise tax on durable medical equipment and medical supplies can be predicted to reduce such investment. The finding here is that such investment would be reduced by about 10 percent annually, or about $2 billion during 2013 through 2020. By analogy with the estimates available in the literature for pharmaceutical investment, this investment loss would cause, conservatively, a loss of about 1 million expected life-years each year, the economic cost of which would be about $100 billion per year, a figure substantially greater than the entire U.S. market for medical devices and equipment.” [Benjamin Zycher, Pacific Research Institute, May 22]

Posted on 05/23/12 01:42 PM by Alex Adrianson

Student Aid Is Really Corporate Welfare; Colleges Capture It by Charging More

“[Stephanie Riegg] Cellini and [Claudia] Goldin looked at for-profit colleges, utilizing the key distinction that only some for-profit schools are eligible for federal aid. Riegg and Goldin find that that aid-eligible institutions ‘charge much higher tuition ... across all states, samples, and specifications,’ even when controlling for the content and quality of courses. The 75 percent difference in tuition between aid-eligible and ineligible for-profit colleges – an amount comparable to average per-student federal assistance – suggests that ‘institutions may indeed raise tuition to capture the maximum grant aid available.’ […]

“Lesley J. Turner, a doctoral candidate in economics at Columbia University, analyzed how institutional aid changed as students became eligible for Pell Grants. She found that, on average, ‘institutions capture 16 percent of all Pell Grant aid.’ However, important differences exist. Public colleges and universities garnered very little Pell money. But selective private colleges – the ones parents really want their kids to attend – claw back 79 percent of the value of Pell Grants.” [Andrew Biggs, The Atlantic, May 21]

Posted on 05/23/12 12:34 PM by Alex Adrianson

The Obama Administration’s War on Coal Is Yielding the Intended Result: Higher Electricity Prices

“Last week the U.S. Energy Information Administration reported a shocking drop in power sector coal consumption in the first quarter of 2012. Coal-fired power plants are now generating just 36 percent of U.S. electricity, versus 44.6 percent just one year ago. […]

“Last week PJM Interconnection, the company that operates the electric grid for 13 states […] held its 2015 capacity auction. […] The market-clearing price for new 2015 capacity – almost all natural gas – was $136 per megawatt. That’s eight times higher than the price for 2012, which was just $16 per megawatt. In the mid-Atlantic area covering New Jersey, Delaware, Pennsylvania, and DC the new price is $167 per megawatt. For the northern Ohio territory served by FirstEnergy, the price is a shocking $357 per megawatt.

“Why the massive price increases? Andy Ott from PJM stated the obvious: ‘Capacity prices were higher than last year’s because of retirements of existing coal-fired generation resulting largely from environmental regulations which go into effect in 2015.’ Northern Ohio is suffering from more forced coal-plant retirements than the rest of the region, hence the even higher price.” [Phil Kerpen, Fox News, May 22]

Posted on 05/23/12 11:02 AM by Alex Adrianson

Small Businesses Unenthused by ObamaCare Tax Credit for Providing Health Insurance to Employees

“While 170,300 small employers claimed it, estimates of the eligible pool by government agencies and small business advocacy groups ranged from 1.4 million to 4 million. […]

“One factor limiting the credit’s use is that most very small employers, 83 percent by one estimate, do not offer health insurance. According to employer representatives, tax preparers, and insurance brokers that GAO met with, the credit was not large enough to incentivize employers to begin offering insurance. Complex rules on [full-time equivalents] and average wages also limited use. In addition, tax preparer groups GAO met with generally said the time needed to calculate the credit deterred claims.” [“Small Employer Health Tax Credit,” Government Accountability Office, May 2012]

Posted on 05/22/12 06:20 PM by Alex Adrianson

Twelve New Lawsuits Filed Against Obamacare

“Monday’s 12 lawsuits on behalf of 43 separate institutions involved only Catholics and for the first time included 13 dioceses — the seats of the bishops themselves.

“The federal lawsuits accuse the U.S. Department of Health and Human Services of violating the First Amendment and federal law by requiring Catholic organizations to ‘sacrifice their beliefs in order to be able to continue their mission of serving all people in need,’ said a statement from the Archdiocese of Washington. ‘There is no way out of the dilemma the mandate forces upon us.’” [Michelle Boorstein, Washington Post, May 20]

Posted on 05/22/12 05:37 PM by Alex Adrianson

Health Savings Accounts Will Cut Spending—Until ObamaCare Kills Them

“Enrollment is increasing in consumer-directed health insurance plans, which feature high deductibles and a personal health care savings account. We project that an increase in market share of these plans—from the current level of 13 percent of employer-sponsored insurance to 50 percent—could reduce annual health care spending by about $57 billion. That decrease would be the equivalent of a 4 percent decline in total health care spending for the nonelderly.” [Amelia M. Haviland, et al., Health Affairs, May 2012]

Posted on 05/22/12 05:22 PM by Alex Adrianson

Commerce Department Imperils Green Jobs with 31 Percent Tariffs on Chinese Solar Panels

“Commerce didn’t have to rule as it did on a complaint last October from seven US-based solar-panel suppliers about alleged Chinese dumping. The key was which ‘surrogate’ market to pick for comparison: It chose Thailand, a tiny market with high prices — not India, where huge demand and economies of scale have driven solar-panel costs lower. […]

“[The Coalition for Affordable Energy] expects the hefty tariffs to raise solar prices and slow conversions — putting in jeopardy the 100,000 jobs it says the sector has created in just a few years. After all, the industry thrived as the price of solar cells and modules dropped from $3.30 per watt in 2008 to roughly $1 by year-end 2011.

“The Commerce decision could also cost the US export business. US suppliers export some $2 billion a year in solar materials to China, but could lose out in a trade war.” [Liz Peek, New York Post, May 1]

Posted on 05/22/12 05:22 PM by Alex Adrianson

The Ocean Is a Frontier, and the Law of the Sea Treaty Seeks to Close It Off

“If the United States uses the Continental Shelf Convention definition, its Atlantic shelf north of Cape Hatteras extends well beyond 200 miles from shore to the 2,450 meter isobath where Perdido Spar is exploiting oil, or well beyond to whatever sea depth ‘admits of exploitation’ of seabed and subsoil resources. If it is already feasible to exploit resources at 10,000 meters depth, then U.S. national territory extends into the north Atlantic abyssal plain. But if the U.S. uses the [Law of the Sea Treaty] definition, its northern Atlantic shelf reaches no further than 200 miles offshore, since the continental margin in that area is less than 200 miles from shore baselines. Of course, as feasible exploitation moves into ever deeper waters, parties to the 1958 Convention would need to assert their respective claims and negotiate boundaries in the resulting overlapping areas.

“In effect, the Continental Shelf Convention makes the United States once again a ‘frontier’ nation, with expanding territorial resources waiting to be exploited in the world’s largest continental shelf, which includes large areas extending from Alaska, Hawaii and U.S. island territories in the Pacific. As exploitation becomes feasible beyond the 2,500 meter isobath, an enormous part of the Earth’s surface becomes U.S. territory by consent of the 1958 treaty parties. […]

“U.S. Senate ratification of LOST would mean the largest abandonment of territorial rights by any nation in history.” [Michael P. Socarras,, May 22]

Posted on 05/22/12 05:09 PM by Alex Adrianson

Stimulus Is Unsustainable; Tax Cuts and Spending Cuts Will Aid the Economy

“To provide a stimulus in 2013 comparable to the 2009 legislated stimulus, we would need to increase government spending by about $250 billion.

“But the Keynesian view implies that keeping spending constant at the higher level in 2014 would generate no stimulative growth effect for 2014. Despite the higher level of spending in 2014, we would get no additional growth because there is no increase in spending over the 2013 level. Were we to retreat to current levels of spending, there would be a contractionary effect on the economy as government spending decreases. If we want to delay our day of reckoning, we must keep spending at a higher level for each year that we want to postpone the negative consequences for growth. Given the state of the labor market, this could mean a few years. If we waited four years, we would spend $1 trillion to get $250 billion in stimulus.

“On the tax side, there is strong evidence that supports the supply-siders. Christina Romer, President Obama’s first chairwoman of the President’s Council of Economic Advisers, and David Romer document the strong unfavorable effect of increasing tax rates on economic growth (American Economic Review, 2010). They report that an increase in taxes of 1% of gross domestic product lowers GDP by almost 3%. The evidence on government spending also suggests that high spending means lower growth.” [Edward Lazear, Wall Street Journal, May 20]

Posted on 05/21/12 06:26 PM by Alex Adrianson

To Do

Enroll in Cato University. The program will be held July 29 – August 3 at Cato newly expanded headquarters in Washington, D.C.

Check out the Competitive Enterprise Institute’s new smart phone app for getting labor union info in real time.

• Dance the night with your fellow travelers in freedom. America’s Future Foundation’s annual Gala will be Thursday at the Arts Club in Washington, D.C.

Posted on 05/18/12 04:39 PM by Alex Adrianson

Toolkit: Don’t Ignore the Heart in the Battle for Minds

So you’ve got all the facts to demonstrate that more liberty is the solution for policy problem X. Why don’t more people agree with your prescription? Yes, the facts are important, but maybe you need to develop the ability to appeal to other people’s values.

Fred Smith explains:

Few people find it reasonable to educate themselves about policies about which they can do little. This is known as rational ignorance. Too often, we in the policy community seek to “educate” the public about the “facts” of a policy, failing to understand that this rational approach is irrelevant to individuals who suffer from information overload and feel that they lack the means to influence policy. […] 

A wide body of literature suggests that people derive their opinions of complex issues from their core values. Effective persuasion requires that we frame our policies in ways that convey understanding and sympathy for their values. 

Intellectual arguments come into play only after we’ve succeeded in opening a communication link. We must first give them a reason to listen. In other words, people don’t care what we know, until they know that we care!

Smith’s chapter “Persuasion and Issue-Framing,” in the Institute for Humane Studies book Creating Your Path to a Career in Public Policy recommends an approach developed by Aaron Wildavsky and Mary Douglas called “Values-Based Communication.” According to VBC, individuals generally hold one of four core values: individualism, hierarchy, egalitarianism, and fatalism.

While fatalists are less politically relevant and hierarchists can be moved by arguments showing the free market is more efficient than government, egalitarians are a tougher lot to move. For them, a simple appeal to liberty as a good in itself is not going to work. We need to show, Smith explains, “how markets reduce the suffering associated with poverty, that richer is healthier, and that freedom of exchange promotes more equitable social arrangements.”

In a country of diverse values, as Smith explains, we can succeed in building a coalition for liberty only by showing people that liberty is the best way of achieving the others ends about which they care.

Posted on 05/18/12 04:27 PM by Alex Adrianson

The Country Needs the American Legislative Exchange Council

“Since 2010, our foundation has worked on a ‘Right on Crime’ program designed to reform state-level criminal-justice policy along common-sense lines that will deliver real justice to victims while offering offenders who pose no threat to public safety a chance to reform.

“ALEC has been instrumental in promulgating many lessons from our ‘Right on Crime’ work to policy makers in other states. For example, the Maryland legislature recently passed legislation patterned on ALEC model legislation derived from our work in Texas. The Maryland bill provides incentives to probationers and parolees to pay restitution, hold down steady work, and engage in good behavior in their communities—while saving Marylanders’ taxpayer dollars as recidivism and re-incarceration rates consequently drop. […]

“Health-care reform, pension reform, and a whole range of public-policy challenges will go unconsidered and unmet if ALEC and institutions like it disappear. In their place will be exactly what ALEC’s antagonists publicly decry: a debate dominated by special-interest groups. […]

“ALEC, and the people who constitute it, are not a conspiracy. They are the natural products of a free and vigorous society under the aegis of our First Amendment. We at the Texas Public Policy Foundation are proud to be a part of that.” [Wendy Gramm and Brooke Rollins, Wall Street Journal, May 15]

Posted on 05/18/12 02:28 PM by Alex Adrianson

Illegal Immigrant Data Cooked?

“Federal law enforcement officials interviewed by The Washington Examiner say security is being compromised as the government seeks to keep a lid on the border as a campaign issue during the presidential election cycle. Department of Homeland Security’s Border Patrol agents and Immigration and Customs Enforcement officers are being told not to make arrests of noncriminal illegal immigrants, and not to patrol areas of high traffic along the roughly 2,000-mile Southwest border.

“A Border Patrol official working along the Texas border said administration officials are deliberately failing to document what is actually happening on the border. ‘In many cases my supervisors make it clear that they don’t want increased apprehension numbers, which means no arrests,’ he said.” [Sara A. Carter, Washington Examiner, May 14]

Posted on 05/18/12 01:20 PM by Alex Adrianson

Real People Teach Us More than Fictional Characters Do

“President Obama recently gave a talk touting the need for government mortgage bailouts to help these same helpless middle class folk who are now the welfare state’s main object of concern. He gave the talk in front of the home of a Reno couple whom he touted as responsible homeowners who had ended up ‘underwater’ on their mortgage. But when CNBC reporters dug into the case, they found out that the couple did a ‘cash-out refinance’ in 2007, at the height of the real estate bubble, and used $51,000 of now-vanished home equity to pay down debt in the husband’s construction business. That’s their prerogative, of course, and maybe the decision to shift debt from their business to their home made sense at the time. But when you deliberately take on extra mortgage debt, you lose the right to complain about having too much mortgage debt.

“This is the kind of messy thing that happens when you use real-life examples instead of the artificial, antiseptic life of Julia. It introduces a whole real-life context to every decision that doesn’t necessarily cooperate with the preferred statist narrative you want to convey. […]

“So what we really need, to counter the ‘life of Julia,’ are real-world examples of lives that are filled with aspiration, lives of resourceful people who set their own goals and achieved them under their own power.” [Robert Tracinski, Real Clear Politics, May 18]

Posted on 05/18/12 01:09 PM by Alex Adrianson

No “Quickie” Union Elections—for Now; Federal Court Says NLRB Failed Quorum Requirement

“According to Woody Allen, eighty percent of life is just showing up. When it comes to satisfying a quorum requirement, though, showing up is even more important than that. Indeed, it is the only thing that matters – even when the quorum is constituted electronically. In this case, because no quorum ever existed for the pivotal vote in question, the Court must hold that the challenged rule is invalid.

“On December 22, 2011, the National Labor Relations Board published a rule that amended the procedures for determining whether a majority of employees wish to be represented by a labor organization for purposes of collective bargaining. […]

“In this suit, Plaintiffs – the Chamber of Commerce of the United States of America and the Coalition for a Democratic Workforce – challenge the final rule on myriad grounds. The Court, however, reaches only their first contention: that the rule was adopted without the statutorily required quorum. Absent limited circumstances not present here, the Board must muster a quorum of three members in order to act. Because Member Hayes did not participate in the decision to adopt the final rule, Plaintiffs argue, the other two members of the Board lacked the authority to effect its promulgation. […]

“Plaintiffs are correct.” [Chamber of Commerce v. NLRB, May 14; via Jonathan Adler, Volokh Conspiracy, May 17]

Posted on 05/18/12 12:43 PM by Alex Adrianson

Gas Tax Revenues Fall as Fuel Efficiency Rises, but There Is an Alternative to Raising Rates

“Electronically collected vehicle-mile fees are as close to a perfect user fee as possible. With vehicle-mile fees, users pay for just the roads they use, when they use them (with the potential for appropriate exceptions […]). In this way, vehicle-mile fees solve all of the problems with gasoline taxes, and they can do so without any intrusions in traveler privacy. The fees can be adjusted to account for inflation, and because they are collected per mile of driving, they avoid problems with fuel-efficiency or the type of fuel that powers the automobile. […]

“In full implementation, the GPS device could keep track of how much each vehicle used roads owned by cities, counties, states, and private parties, resulting in separate charges for each. This would allow all road owners to collect fees for actual use of their roads. The fees could vary for each road depending on the cost of that road relative to the total usage of the road. […]

“Vehicle-mile fees would have the added advantage of putting the various owners of roads in competition with one another. City, county, and state road departments and private road owners would have incentives to build, maintain, and operate their roads as efficiently as possible to keep road charges competitive with those of other road owners. They would also have incentives to keep the roads in good condition to make them attractive to users.” [Randal O’Toole, Cato Institute, May 15]

Posted on 05/18/12 12:01 PM by Alex Adrianson

The Regulatory State Is Huge and Growing

“[R]egulatory costs now tower over the estimated 2011 individual income taxes of $956 billion (individual income tax receipts have fallen substantially in the economic downturn). Corporate income taxes, estimated at $198 billion, are dwarfed by regulatory costs (and have declined by half in the downturn). […] [R]egulatory compliance costs exceed the level of pretax corporate profits, which were $1.317 trillion in 2009. (Corporate profits have dropped over the past few years.) For a global perspective, U.S. regulatory costs of $1.752 trillion exceed the output of many major national economies. […] U.S. regulatory costs surpassed the entire 2009 gross national incomes of Mexico and Canada, which stood at $962 trillion and $1.416 trillion, respectively. For the United States, CBO noted 2011 GDP of $14.954 trillion. Total regulatory costs of $1.752 trillion are equivalent to 11.7 percent of that amount. Combining regulatory costs with federal FY 2011 outlays of $3.598 trillion indicates that the federal government’s share of the economy (of GDP) now reaches 35.8 percent. […]

“Adding the $55 billion in administrative costs tabulated by the Weidenbaum Center and Mercatus Center to the $1.752 trillion in the Crains’ estimate for compliance costs brings the total estimated 2010 regulatory burden to around $1.8 trillion.” [Internal citations omitted.] [Clyde Wayne Crews, “Ten Thousand Commandments 2012,” The Competitive Enterprise Institute, May 2012]

Posted on 05/18/12 11:32 AM by Alex Adrianson

Students Loans Are Subsidies for High-Income Earners

“[S]tudent loans owned by the Federal Government have grown from $111 billion at the end of 2008 to $425 billion […] as of December 31, 2011, a compound annualized growth rate of 56%. With a 9% default rate among borrowers in the most recent cohort and no collateral to cushion default severities (there are added protections in bankruptcy), the program’s interest rate would be insufficient to cover expected credit losses at today’s default rates. […]

“On the one hand, President Obama wishes to present himself as one of the fortunate few who should have to pay more in taxes so the government can provide greater, or ongoing, loan subsidies to prospective college students. At the same time, the President references his own experience as a one-time recipient of student loans to argue for lessening the financial burden on prospective recipients. […] If he can personally pay more in income taxes to defray the cost of the government’s student loans, he most certainly could pay the interest and principal balance on the loans he took out to finance his education. […]

“According to the most recent data from the Bureau of Labor Statistics (BLS), the median weekly earnings for college graduates in 2012 is 1.6-times that for workers whose highest degree was high school. The median worker with an advanced degree earns 2.1-times as much as the median high school graduate.” [e-21, May 10]

Posted on 05/17/12 10:42 PM by Alex Adrianson

The Food and Drug Administration Creates Drug Monopolies

“The number of drugs approved by the FDA each year is trending downward despite significant annual increases in the agency's budget. Perhaps the most ominous statistic of all is that drug manufacturers recoup their R&D costs for only one in five approved drugs, a deterioration from the one in four figure of about a decade ago.

“[…] A recent survey of the intentions of venture capital firms reflects the negative impacts of drug and medical device regulation. […] Thirty-six percent of respondents said they plan to increase investments in life science companies in Europe, while only 13 percent plan to increase investment in U.S. companies; and 31 percent said they plan to decrease investment in life science companies in the United States, compared to 7 percent that plan to decrease investment in Europe. Sixty-one percent of the investors cited regulatory challenges as the primary reason; more specifically, they alluded to dysfunction, unpredictability, and risk aversion at the FDA. […]

“[T]he agency—sometimes spurred by Congress—has invented new criteria, including a requirement to demonstrate superiority over existing drugs, which it applies arbitrarily. […]

“Wyeth’s chairman and CEO Robert Essner described the impact of the requirement to show superiority this way: ‘If you’re the first company to get approved in a certain area and competitors can’t get on the market, the FDA is now establishing monopolies. And that’s certainly not their mandate.’” [Henry Miller, Defining Ideas, May 11]

Posted on 05/17/12 10:18 PM by Alex Adrianson

When Government Designs Rating Systems

“One of the primary determinants of health care quality is access to primary care. In a time when more and more primary care physicians are dropping out of the Medicare [Fee for Service] program due to low payment rates, most [Medicare Advantage] plans score well on this measure – so [the Center for Medicare & Medicaid Services] is dropping it from the 2013 star rating criteria. If one assumes that CMS is not deliberately trying to reduce performance in this critical area, the only other purpose for dropping this measure would be to reduce MA program payments.” [Douglas Holtz-Eakin, Robert A. Book, & Michael Ramlet, American Action Forum, May 15]

Posted on 05/17/12 02:36 PM by Alex Adrianson

White House Shoehorns Obama into Other Presidents’ Online Biographies

“Obama has added bullet points bragging about his own accomplishments to the biographical sketches of every single U.S. president since Calvin Coolidge (except, for some reason, Gerald Ford). Here are a few examples:

“• On Feb. 22, 1924 Calvin Coolidge became the first president to make a public radio address to the American people. President Coolidge later helped create the Federal Radio Commission, which has now evolved to become the Federal Communications Commission (FCC). President Obama became the first president to hold virtual gatherings and town halls using Twitter, Facebook, Google+, LinkedIn, etc. […]

“• President Lyndon Johnson signed Medicare signed (sic) into law in 1965—providing millions of elderly healthcare stability. President Obama’s historic health care reform law, the Affordable Care Act, strengthens Medicare, offers eligible seniors a range of preventive services with no cost-sharing, and provides discounts on drugs when in the coverage gap known as the ‘donut hole.’ […]

“• In a June 28, 1985 speech Reagan called for a fairer tax code, one where a multi-millionaire did not have a lower tax rate than his secretary. Today, President Obama is calling for the same with the Buffett Rule.” [Seth Mandel, Commentary, May 15]

Posted on 05/16/12 12:22 PM by Alex Adrianson

Where Franciscan University Stands

“A Catholic university in Ohio said Tuesday it is being forced to end a student health insurance program over the Obama administration’s contraception mandate and costs associated with other provisions of the health care overhaul.

Franciscan University in Steubenville, Ohio, said it has so far excluded contraceptive services and products from its health insurance policy for students and will not participate in a plan that ‘requires us to violate the consistent teachings of the Catholic Church on the sacredness of human life.’

“In its decision to drop coverage, the school cited the contraception mandate, but also a requirement that the maximum coverage amount be increased to $100,000 for policyholders – claiming that would have made premiums skyrocket. A university official told Fox News Radio the students’ basic $600 policy was going to double in cost in the fall and triple next year and that the school’s insurance provider said the increases were the result of the federal Patient Protection and Affordable Care Act.” [Fox News, May 16]

Posted on 05/16/12 12:08 PM by Alex Adrianson

States Taxing Beyond Their Borders Is a Growing Problem

“For decades, American schoolchildren have purchased books and other educational materials from Scholastic Book Club, Inc., which seeks to foster good reading habits and complement classroom education. However, courts in two states (Connecticut and Tennessee) have ruled this year that Scholastic owes back sales and use taxes, despite the fact that the company has neither property nor employees in those states, potentially disrupting Scholastic’s mission. […]

“With over 9,600 sales tax jurisdictions in the United States, each with a parochial and bewildering set of rates, rules, and bases, it is difficult for businesses to comply fully with these requirements, particularly since they are becoming less uniform and more complex each year. […]

“The rise of Internet retailers and economic integration generally means the costs of nexus uncertainty are more likely to burden and impede economic growth. The Scholastic cases illustrate the inconsistency of courts in deciding state tax authority and the necessity for Congress or the courts to definitively resolve the problem. States’ strong desire to shift the burdens of government from the voters and businesses that benefit directly from its services to unrepresented, remote taxpayers can only be checked by congressional or court action.” [Internal citations omitted.] [Joseph Henchman and Jordan King, Tax Foundation, May 15]

Posted on 05/15/12 06:00 PM by Alex Adrianson

Sen. Carl Levin Has More Important Things to Worry About than JP Morgan Chase’s $2 Billion Mistake

“The bank has more than $2 trillion in assets and made a profit of about $20 billion last year. So it lost one-tenth of 1 percent of its assets and an amount equal to about 10 percent of its income for last year. […]

“One can understand that the bank’s stockholders and board are unhappy with the mistake, because the bank’s stock took the expected hit. Heads are rolling already. That is, the board is fulfilling its responsibilities without more rules from Congress.

“Congress has the oversight responsibility for the U.S. government, in much the same way a corporate board has the oversight responsibility for a corporation. Mr. Levin has the responsibility (along with his colleagues) to make sure taxpayer dollars are spent wisely and not wasted or stolen. Medicare, for example, spends more than $500 billion annually. Sen. Tom Coburn, Oklahoma Republican, who, unlike Mr. Levin, tries to be fiscally responsible, estimates that about 20 percent, or $100 billion, of Medicare spending is fraudulent. Other estimates of Medicare fraud, including those of the U.S. government, range between $20 billion and $100 billion. The point is that Mr. Levin and many of his colleagues prefer to spend their time bashing private businesses rather than protecting the taxpayer, which is their responsibility.” [Richard Rahn, Washington Times, May 14]

Posted on 05/15/12 05:17 PM by Alex Adrianson

Reviving the Law of the Sea Treaty Is Still a Bad Idea

“If the United States joined the convention [UNCLOS], it would be required to transfer a portion of the royalty revenue generated on the U.S. extended continental shelf (the shelf beyond 200 nautical miles from shore) to the International Seabed Authority in Kingston, Jamaica. […]

“[I]t is unlikely that the United States would be able to prevent the Authority from distributing Article 82 revenue to Cuba and Sudan, UNCLOS members that the U.S. State Department has designated as state sponsors of terrorism. It would also be difficult for the United States to block the Authority from sending funds to the undemocratic, despotic, and/or brutal regimes in Belarus, Burma, China, Somalia, and Zimbabwe. Finally, the United States would have limited ability to stop the transfer of Article 82 revenue to corrupt regimes, especially given that 13 of the 20 most corrupt nations in the world are UNCLOS members. […]

“UNCLOS is silent on how UNCLOS nations that receive Article 82 royalty revenue should spend it. UNCLOS does not require recipient nations to spend the revenue on anything related to the oceans or the maritime environment. Nor does it require them to spend the revenue on humanitarian or development projects, even though most, if not all, of the eligible recipients are supposed to be poor, developing countries. Recipients are apparently free to spend the funds on military expenditures or simply deposit them into the personal bank accounts of national leaders.” [Steven Groves, The Heritage Foundation, June 7, 2011]

Posted on 05/15/12 04:34 PM by Alex Adrianson

Where Georgetown Stands

“The invitation to Mrs. [Kathleen] Sebelius is pictured by the university publicity office as one of rather minor significance, in the Public Policy Institute. I am sure this comes as news to the HHS secretary. It is an honors program, an awards ceremony, not a graduation. What difference this makes is not exactly clear. Fine distinctions abound. In any case, an address is to be delivered.

“Now, no one is naïve enough to think that more attention will be paid to some other speaker this year than to the HHS secretary. It is a perfect public relations or newsworthy set-up. A bureaucrat, speaking at a Catholic university, has proposed, in effect, shutting down most Catholic charitable and educational organizations unless they agree to support programs that are contrary to reason and faith.

“She speaks presumably in support of her position, a position specifically rejected by the nation’s bishops as contrary to our tradition of liberty and religious autonomy. It’s man bites dog. No reporter worth his salt would miss it. ‘FEDERAL OFFICIAL DEFINES RELIGION IN HONORARY ADDRESS.’ We can see it now.

“The rule of thumb in these matters is: ‘Tell me who you honor and I will tell you what you are.’” [James V. Schall, The Catholic Thing, May 15]

Posted on 05/15/12 03:36 PM by Alex Adrianson

Liberal Bias in Commencement Speaker Invitations

“Young America’s Foundation’s 19th annual ‘Commencement Speakers Survey’ reveals that 71 liberal speakers—and only ten conservatives—are scheduled to speak or have already spoken at the 2012 commencement ceremonies for the top 100 universities as listed by US News and World Report.

“Among the top 35 universities, only one conservative is scheduled to speak, compared to 29 liberals.

“Sixteen Obama administration officials and appointees will speak, more than all the conservatives combined. Young America’s Foundation’s previous research shows that Bush administration officials spoke at the top 100 universities a total of 14 times throughout his Presidency. In President Obama’s first three years, administration officials have spoken 29 times—more than double the total number of Bush administration speeches.” [Ron Meyer, Young America’s Foundation, May 14]

Posted on 05/15/12 11:44 AM by Alex Adrianson

Labor Laws Are One Reason 2.9 Million Are Out of Work in France

“Here’s a curious fact about the French economy: The country has 2.4 times as many companies with 49 employees as with 50. What difference does one employee make? Plenty, according to the French labor code. Once a company has at least 50 employees inside France, management must create three worker councils, introduce profit sharing, and submit restructuring plans to the councils if the company decides to fire workers for economic reasons.

“French businesspeople often skirt these restraints by creating new companies rather than expanding existing ones. ‘I can’t tell you how many times when I was Minister I’d meet an entrepreneur who would tell me about his companies,’ Thierry Breton, chief executive officer of consulting firm Atos and Minister of Finance from 2005 to 2007, said at a Paris conference on April 4. ‘I’d ask, ‘Why companies?’ He’d say, ‘Oh, I have several so that I can keep [the workforce] under 50.’ We have to review our labor code.’

“[…] Companies say the biggest obstacle to hiring is the 102-year-old Code du Travail, a 3,200-page rule book that dictates everything from job classifications to the ability to fire workers. Many of these rules kick in after a company’s French payroll creeps beyond 49.” [Gregory Viscusi and Mark Deen, Businessweek, May 3]

Posted on 05/14/12 06:18 PM by Alex Adrianson

Before His Daring Dash, Chen Guangcheng Uncovered the Horror of China’s One-Child Policy

“His 2005 investigation reported 130,000 forced abortions and sterilizations that year in the city of Linyi alone. Building a case to sue local officials, Chen interviewed women about their harrowing experiences; summaries of 14 of his interviews are posted on the website of Women’s Rights Without Frontiers.

“Zhongxia Fang’s story began with a third pregnancy after giving birth to two daughters, despite an IUD implanted by Family Planning officials. While she sought to evade authorities, they systematically harassed 22 of her relatives – including her pregnant sister, a relative over 70 and several children – with fines, detainment and beatings.

“When the authorities threatened to beat her aunt to death, Zhongxia turned herself in. She was seven months’ pregnant. Officials injected her with an oxytocic drug and her baby was aborted the next day. Then they performed a ligation to sterilize Zhongxia. Only then was her aunt freed.

“Ping Liu testified before Congress last September about undergoing five forced abortions. The factory at which she worked, staffed mainly by women of childbearing age, strictly imposed the One-Child Policy and used collective punishment to enforce it. Fellow workers reported two of her pregnancies.

“To prove they weren’t pregnant, the factory’s female employees had to go to the ‘birth planning doctor’ once a month. Only then would they get paid for their work.” [Link added to original.] [Jennifer A. Marshall, McClatchy News Service, May 14]

Posted on 05/14/12 05:59 PM by Alex Adrianson

To Do: Acton U, Heartland Climate Conference, Hayek Essay Contest

Sign up for Acton University. The program, which runs June 12 – 15 in Grand Rapids, Mich., is “an opportunity to deepen your knowledge and integrate rigorous philosophy, Christian theology and sound economics.”

Get ready for the Heartland Institute’s seventh International Conference on Climate Change, May 21 – 23 in Chicago. This conference is the one that tries to figure out what’s really happening with the climate, and invites scientists from all perspectives to speak. Heartland even invited to Peter Gleick, the guy who faked a climate strategy memo he said he got from Heartland. Alas, Gleick turned them down. But there will be 60 other climate scientists making presentations.

Delve into some Hayek and win $2,500. If you are a 35 years or younger, check out the Mont Pelerin Society’s Hayek Essay Contest, which this year focuses on Friedrich Hayek’s views on monetary institutions. Second and third prizes win $1,500 and $1,000 respectively. The deadline for entering has been extended to June 10.

Get up to speed on national security issues during May—AKA, Protect America Month. The Heritage Foundation will be publishing and hosting events on national security all month. Check out the calendar.

Relive the 35th Annual Resource Bank by checking out the videos and photos, the links to which are now available on the event Web page.

Posted on 05/11/12 03:33 PM by Alex Adrianson

Toolkit: Get the Most out of Your Facebook Posts

Five things to remember:

1. Headlines. If you post a link on your profile page, you can easily click inside the headline and change it (same goes for the summary). Think about what would make someone want to click that link or “like” it immediately. Be a little sensational and do your own headline marketing.

2. Questions. Ask genuine questions of your readers. If you’ve posted a link to an article about our troops in Afghanistan, for example, use the white space to ask your friends what they think in light of the link. Ask in a personal tone so people feel like it’s a conversation worth joining.

3. Action. A good mantra to remember on Facebook: “Ask and you shall receive.” Calls to action generally produce the best results. Ask people to “like” the post, “answer” the question, or “share” the video. Many times, people just don’t think about the action without a little prompting. Go for it.

4. Timing. Don’t post too many updates on your Facebook page. As a general rule, post only one to three times per day. Be aware of how long your posts generate attention. Respect the life span of a post and let it breathe as long as it wants to. Posting too often gets your posts lost in the shuffle, and the whole point is to have your message seen.

5. Value. What value does your post add to someone else’s Facebook newsfeed? Think about what others will see when they log in to Facebook looking for something interesting. Thoughtful posts with punchy headlines, genuine questions, substantial calls to action, and—most importantly—valuable information, will increase your worth as a Facebook friend.

Posted on 05/11/12 02:45 PM by Alex Adrianson

At Some Point, Reality Intrudes

“[S]ometimes reducing spending isn’t a macroeconomic strategy but something that is forced on you by reality. One response you hear to this is that reducing spending is bad for your economy when you’re in a recession. Maybe. I’m not convinced. Could be, but even if it’s true, if people don’t want to lend you money anymore or only want to lend you money at an extremely unattractive rate, that fact that your past profligacy now demands an unpleasant solution is simply an aspect of reality.

“Those who oppose spending cuts when the bond market no long likes you reminds me of a metaphor I recently heard from a student at SMU when I visited the campus […] . He used the metaphor of a restaurant patron who discovers that he doesn’t have enough money to pay the bill. No problem. Just keep ordering more food! That way you can put off the moment of reckoning. That is not a practical solution for irresponsible customers or countries who have gone too far. Greece is in this boat. They may soon be joined by others. I hope the US gets on a different boat.” [Russ Roberts, Café Hayek, May 10]

Posted on 05/11/12 02:16 PM by Alex Adrianson

Sharp State Spending Cuts Slowing the Economy? Can't Be True

“According to the U.S. Bureau of Economic Analysis (BEA), which provides the ‘only comprehensive estimates of state and local government [fiscal] activity available on a timely basis,’ state and local government spending grew by 6.6% from 2008 through 2011. During this same period, the consumer price index for all items grew by 4.4%, which means that state and local government spending expanded faster than the rate of inflation.

“Likewise, if government spending is measured as a percentage of the nation’s gross domestic product, state and local government spending increased by 0.9% over this period, although it peaked in 2009 and decreased by 2.3% between 2009 and 2011. […] [A] 2.3% decline in this context hardly qualifies as ‘sharp,’ especially since by the same measure, spending rose by 7.0% in the two years prior to this.” [Jim Agresti, Just Facts, May 9]

Posted on 05/11/12 02:13 PM by Alex Adrianson

Spending Cuts Holding Back Europe? Can’t Be True

“Following years of large spending expansion, Spain, the United Kingdom, France, and Greece—countries widely cited for adopting austerity measures—haven’t significantly reduced spending since ‘austerity’ supposedly started in 2008.” [Veronique de Rugy, Mercatus Center, May 7]

Posted on 05/11/12 02:12 PM by Alex Adrianson

Fewer Life-Extending Inventions Coming, Thanks to ObamaCare

“In 2010, however, Congress, ravenous for revenue to fund Obamacare, included in the legislation a 2.3 percent tax on gross revenue — which generally amounts to about a 15 percent tax on most manufacturers’ profits — from U.S. sales of medical devices beginning in 2013. This will be piled on top of the 35 percent federal corporate tax, and state and local taxes. The 2.3 percent tax will be a $20 billion blow to an industry that employs more than 400,000, and $20 billion is almost double the industry’s annual investment in research and development. […]

“Cook Medical is no longer planning to open a U.S. factory a year. Boston Scientific, planning for a more than $100 million charge against earnings in 2013, recently built a $35 million research and development facility in Ireland and is building a $150 million factory in China. (Capital goes where it is welcome and stays where it is well-treated.) Stryker Corp., based in Michigan, blames the tax for 1,000 layoffs. Zimmer, based in Indiana, is laying off 450 and taking a $50 million charge against earnings. Medtronic expects an annual charge against earnings of $175 million. Covidien, now based in Ireland, has cited the tax in explaining 200 layoffs and a decision to move some production to Costa Rica and Mexico.” [George Will, Washington Post, May 9]

Posted on 05/11/12 01:46 PM by Alex Adrianson

Evidence that State Policies Matter: Red States Fare Better than Blue States Under Obama

“Job growth: The average increase for blue states was just 1.2% from June 2009 — the official start of the economic recovery — to March 2012. For red states, it was 1.9%. The national average was 1.8%, according to the Bureau of Labor Statistics.

“Unemployment: The jobless rate in March was 8.5% in blue states and 7.4% in red states, BLS data show.

“Income: Blue states also did a bit worse when it came to per capita personal pay, rising 4.27% in 2011 compared with 4.35% in red states, according to the Bureau of Economic Analysis data

“GDP: The one measure where blue states outperformed was in gross domestic product growth, clocking an average 2.5% increase from 2009 to 2010 vs. red states’ 2.2%. State GDP figures for 2011 won’t come out until June.

“Home prices: People living in liberal areas suffered the most when it came to housing prices. Over the past year, the housing price index fell 3.5% in blue states. The index edged up by 0.03% in conservative states. Nationwide, it was down 2.4%, according to the Federal Housing Finance Agency’s House Price Index. Over the past five years, housing prices in red states fell 7.5%, but by 18.5% in blue states.” [John Merline, Investor’s Business Daily, May 8]

Posted on 05/11/12 01:44 PM by Alex Adrianson


“In 1962, Byron White’s hearing lasted 15 minutes and consisted of three questions. Can you imagine that happening now? Most district court nominees would take that deal. Is it because of TV and the media and the instant sound bite and the new media with the Internet and social networking and all the rest of it? Is it because the issues have gotten more ideologically divisive? I think the answer isn’t really any of these. It isn’t that there’s been a corruption of the confirmation process, the nomination process, presidential or senatorial rhetoric, or the use of filibusters. It’s a relatively new development but one that’s part and parcel of a much larger problem: constitutional corruption.

“As government has grown, so have the laws and regulations over which the Court has power. The Court’s power has grown commensurate with the power of Congress, because all of a sudden it’s declaring what Congress can do with its great powers and what kind of new rights will be recognized.  As we have gone down the wrong jurisprudential track since the New Deal, judges all of a sudden have more power behind them and the opportunity to really change the direction of public policy more than they ever did.” [Ilya Shapiro, Cato-at-Liberty, May 8]

Posted on 05/11/12 01:43 PM by Alex Adrianson


“Quite literally, EMTs hold lives in their hands, yet 66 other occupations have greater average licensure burdens than EMTs. This includes interior designers, barbers and cosmetologists, manicurists and a host of contractor designations. By way of perspective, the average cosmetologist spends 372 days in training; the average EMT a mere 33. […]

“[I]rrationalities are particularly notable when few states license an occupation but do so onerously. One clear example is interior design, the most difficult of the 102 occupations to enter, yet licensed in only three states and D.C. Another is social service assistants, the fourth most difficult occupation to enter. It requires nearly three-and-a-half years of training but is only licensed in six states and D.C. Dietetic technicians must spend 800 days in education and training, making for the eighth most burdensome requirements, but they are licensed in only three states.” [Dick M. Carpenter II, Lisa Knepper, Angela C. Erickson and John K. Ross, ‘License to Work: A National Study of Burdens from Occupational Licensing,’ The Institute for Justice, May 2012]

Posted on 05/11/12 01:43 PM by Alex Adrianson

Learned Helplessness—the Opposite of Earned Success—Reduces Happiness

“During experiments, [psychologist Martin] Seligman observed that when people realized they were powerless to influence their circumstances, they would become depressed and had difficulty performing even ordinary tasks. In an interview in the New York Times, Mr. Seligman said: ‘We found that even when good things occurred that weren’t earned, like nickels coming out of slot machines, it did not increase people’s well-being. It produced helplessness. People gave up and became passive.’

“Learned helplessness was what my wife and I observed then, and still do today, in social-democratic Spain. The recession, rigid labor markets, and excessive welfare spending have pushed unemployment to 24.4%, with youth joblessness over 50%. Nearly half of adults under 35 live with their parents. Unable to earn their success, Spaniards fight to keep unearned government benefits.

“Meanwhile, their collective happiness—already relatively low—has withered. According to the nonprofit World Values Survey, 20% of Spaniards said they were ‘very happy’ about their lives in 1981. This fell to 14% by 2007, even before the economic downturn.” [Arthur Brooks, Wall Street Journal, May 8]

Posted on 05/11/12 01:43 PM by Alex Adrianson


“People would have been better off if we’d insisted that the c. 1800 Ottoman Empire had the same currency again: Tunisia, Turkey, Israel and Greece. Which is a real indication of how dumb it was to try and get Greece and Germany into the same currency.” [Tim Worstall, The Telegraph, May 9]

Posted on 05/11/12 01:40 PM by Alex Adrianson


“[T]he government’s official accounting rules effectively force budget analysts to understate the cost of loan programs like those managed by the Ex-Im bank.

“These rules – mandated in the Federal Credit Reform Act of 1990 (FCRA) – understate the cost government loan programs impose on taxpayers by excluding, or not factoring in, the cost for market risk. The current rules require that budget estimates discount expected loan performance using the interest rates on risk-free U.S. Treasury debt rather than a rate that matches the riskiness of the loan itself. That flaw makes it appear as if the government can offer far more favorable loan terms than what a purely private entity would charge without imposing a cost on taxpayers. […]

“[T]he Ex-Im bank’s loan guarantees are made at sufficiently generous terms that borrowers receive subsidies of about 1% of the amount borrowed. That translates into a $200 million cost for taxpayers on the $21 billion in loans that the bank will make in 2012. Because the bank’s smaller loan programs already carry positive subsides under FCRA, the total subsidy level for the entire Ex-Im bank business is even higher than $200 million using fair-value estimates. [Jason Delisle and Christopher Papagianis, e-21, March 29]

Posted on 05/11/12 01:38 PM by Alex Adrianson


“Even before the economic downturn, California was moving toward greater class inequality, but the Great Recession exacerbated the trend. From 2007 to 2010, according to a recent study by the liberal-leaning Public Policy Institute of California, income among families in the 10th percentile of earners plunged 21 percent. Nationwide, the figure was 14 percent. In the much wealthier 90th percentile of California earners, income fell far less sharply: 5 percent, only slightly more than the national 4 percent drop. Further, by 2010, the families in the 90th percentile had incomes 12 times higher than the incomes of families in the 10th—the highest ratio ever recorded in the state, and significantly higher than the national ratio. […]

“The reliably left-leaning Center for the Continuing Study of the California Economy found that between 2005 and 2009, the state lost fully one-third of its construction jobs, compared with a 24 percent drop nationwide. California has also suffered disproportionate losses in its most productive blue-collar industries. Over the past ten years, more than 125,000 industrial jobs have evaporated, even as industrial growth has helped spark a recovery in many other states. […]

“[T]he state’s progressives have fostered a tax environment that slows job creation, particularly for the middle and working classes. In 1994, California placed 35th in the Tax Foundation’s ranking of states with the lightest tax burdens on business; today, it has plummeted to 48th.” [Joel Kotkin, City Journal, Spring 2012]

Posted on 05/11/12 01:38 PM by Alex Adrianson


“It’s worth remembering that 97 percent of the world’s population growth takes place in the religious tropics, while populations in secular East Asia and the West are aging and would already be declining were it not for immigration. Birth rates are coming down in the developing world, but the peak population pressure between the global North and South lies ahead, in 2050. At that time, the UN projects that there will be four (largely religious) Africans for every European, compared to the situation in 1950 when there were two and a half Europeans per African. According to the Gallup World Poll and World Religious Database, this global demographic revolution has already made the world a more religious place than it was in 1970, and will continue to do so. As the secular regions age and depopulate, they will replenish their workforce with religious immigrants, injecting religion back into society and politics. From this perspective, high profile incidents like the murder of Dutch filmmaker Theo van Gogh or the banning of the burqa in France may prove to be the opening stanzas of a new epic in which religion re-enters public life.” [Eric Kaufmann, The American, May 8]

Posted on 05/11/12 01:37 PM by Alex Adrianson


“The best that can be said of these topics is that they’re so irrelevant no one will ever look at them.

“That’s what I would say about Ruth Hayes’ dissertation, ‘So I Could Be Easeful’: Black Women’s Authoritative Knowledge on Childbirth.’ It began because she ‘noticed that nonwhite women’s experiences were largely absent from natural-birth literature, which led me to look into historical black midwifery.’ […]

“But topping the list in terms of sheer political partisanship and liberal hackery is La TaSha B. Levy. […] Ms. Levy’s dissertation argues that conservatives like Thomas Sowell, Clarence Thomas, John McWhorter, and others have ‘played one of the most-significant roles in the assault on the civil-rights legacy that benefited them.’ […]

“If these young scholars are the future of the discipline, I think they can just as well leave their calendars at 1963 and let some legitimate scholars find solutions to the problems of blacks in America. Solutions that don’t begin and end with blame the white man. [Naomi Schaeffer Riley, The Chronicle of Higher Education, April 30]

Posted on 05/11/12 01:36 PM by Alex Adrianson


“The Chronicle of Higher Education has severed ties with a blogger after her post dismissing black studies as ‘left-wing victimization clap-trap’ provoked a torrent of criticism, including a petition signed by more than 6,000 people calling for her dismissal.

“The blogger, Naomi Schaefer Riley, posted her commentary, called ‘The Most Persuasive Case for Eliminating Black Studies? Just Read the Dissertations,’ on the Chronicle’s Brainstorm blog on April 30. It was a response to a long article in the Chronicle two weeks previously, reporting on what it described as a discipline ‘swaggering into the future’ and highlighting several dissertations, none of which Ms. Riley found at all impressive.” [Jennifer Scheussler, The New York Times, May 8]

Posted on 05/11/12 12:51 PM by Alex Adrianson


“A new study, Could Methane Produced by Sauropod Dinosaurs Have Helped Drive Mesozoic Climate Warmth?, [PDF] in Current Biology suggests that dinosaur flatulence may have boosted global average temperatures by as much as 18 degrees Fahrenheit in the Mesozoic era over today’s temperatures. The British researchers basically scaled up estimates of the amount of methane that cows produce today to the amount that might have been produced by herds of giant reptiles. Methane’s global warming potential is about 25-fold greater than that of carbon dioxide. […]

“Thank goodness an asteroid slammed into the Earth 65 millions years ago to put a stop dinogenic climate change!” [Ron Bailey, Reason, May 7]

Posted on 05/11/12 12:50 PM by Alex Adrianson


“[V]iews that were hostile to America, the West, and non-Muslim or secular cultures represented nearly 52 percent of the English data, while in Arabic they represented 75 percent.” [Facebook Fatwa: Saudi Clerics, Wahhabi Islam, and Social Media, Foundation for the Defense of Democracies, 2012]

Posted on 05/11/12 12:48 PM by Alex Adrianson


“On average, women will never be at complete parity with men, because they choose different jobs and many choose to combine work and family and work part time. When women work full time, they work fewer hours. In April, full-time working women worked 12 percent fewer hours than men.

“Even in 2011, the year after Mr. Obama called for passage of the Paycheck Fairness Act, women on the White House staff made 82 percent of male staffers’ wages. The White House put more experienced men into senior positions, skewing the average. If Mr. Obama can’t pay women the same as men in his own White House, with countless competent women willing to work there, why should he expect employers to do so in their businesses?” [Diana Furtchgott-Roth, U.S. News & World Report, May 4]

Posted on 05/11/12 12:48 PM by Alex Adrianson


“A 14-page analysis by the Republican majority staff of the House Armed Services Committee says the cumulative cuts will result in Army and Marine Corps losing 200,000 troops.

“The Navy will shrink from 300 ships to 238 vessels and would lose two carrier battle groups needed to project American power and influence. Strategic bombers will fall from 153 to 101. Air Force fighters would drop by more than half, from 3,602 aircraft to 1,512 planes. These are real cuts, both in spending and in military capability.

“In a recent joint appearance recently with Secretary of State Hillary Clinton at the National Defense University, Defense Secretary Leon Panetta warned, ‘Very simply, (further cuts) would result in hollowing out the force,’ alluding to reductions made in the aftermath of the Vietnam War that left Army units undermanned and ill-equipped. ‘It would terribly weaken our ability to respond to the threats in the world.’” [Investor’s Business Daily, May 4]

Posted on 05/11/12 12:48 PM by Alex Adrianson


“Thanks to the transparency provisions of the bill (and transparent prices are, in general, a good thing), low-cost providers will know what their peers are charging. They will therefore have the ability to raise their prices considerably.

“For example, let’s say Mass General charges $32,000 for a coronary angioplasty, whereas the state median is $21,000, driven in part by low-cost Tufts, which is charging $16,000. Now that Tufts knows that MGH is charging $32,000, Tufts knows that it can charge, say, $25,000 per procedure, and still gain favorable status from insurers, without incurring the new ‘luxury tax.’

“Once Tufts raises its price to $25,000, the ‘median’ price for angioplasties in the state goes up, allowing MGH to raise its price further, and the cycle repeats itself.” [Avik Roy, Forbes, May 6]

Posted on 05/11/12 12:47 PM by Alex Adrianson

Labor Force Participation Rate at 30-Year Low

“The Bureau of Labor Statistics reported that the economy added 115,000 jobs in April and the unemployment rate declined to 8.1 percent from 8.2 percent. […] The slight decline in the unemployment rate was the result of 342,000 individuals leaving the labor force. The labor force participation rate declined from 63.8 percent to 63.6 percent, the lowest level since December 1981.” [Rea Hederman, Jr. and James Sherk, The Heritage Foundation, May 4]

Posted on 05/11/12 12:45 PM by Alex Adrianson

Toolkit: Setting Goals for Fundraising

Anybody can be a fundraiser, but you have to set goals in order to do it. Heritage Vice President John Von Kannon gave a talk on just that topic last week at Resource Bank. Here are some snippets of his advice:

The first goal for a fundraiser is to make budget. The budget comes from your business plan, and the business plan follows from your organization’s mission statement. Fundraising is about selling the mission of the organization to potential donors.

You need to identify enough prospects to allow you to make budget. Having a direct mail program will help you identify donors who may be willing to make larger gifts.

The next step is cultivation. Learning your donors passions and interests will help inform the ask. This means talking and, more important, listening.

Once the donor knows enough and cares enough, it is time to solicit the gift. The ask is never about your needs. It’s about the donor’s needs—how making them a part of your organization’s mission can enhance their lives.

Stewardship is about thanking people for their gifts and recognizing their gifts, but it also means making the relationship about more than money. Make sure your organization’s president thank donors personally for gifts. Never take the continued support of a long-time donor for granted; you need to convince them anew with every ask.

The second goal for a fundraiser: The widow of a donor is genuinely happy to see you when you attend his funeral. This demonstrates that your relationship was real and personal, rather than financial and transactional.

These principles apply regardless of the size of your organization, or whether you are soliciting from individuals or foundations. Foundations are run by individuals who have needs, too. Fundraising is about building relationships.

Posted on 05/04/12 03:56 PM by Alex Adrianson

To Do: Learn What’s Really Happening with the Climate

• Get ready for the Heartland Institute’s seventh International Conference on Climate Change, May 21 – 23 in Chicago. This conference is the one that tries to figure out what’s really happening with the climate, and invites scientists from all perspectives to speak. Heartland even invited to Peter Gleick, the guy who faked a climate strategy memo he said he got from Heartland. Alas, Gleick turned them down. But there will be 60 other climate scientists making presentations.

• Remember Hilton Kramer, defender of Western Civilization against post-modernism. The editors of The New Criterion will host a memorial reception dedicated to the magazine’s founder on Wednesday, May 9. The reception is open to the public but space is limited. For details on location or to RSVP contact Emily Smith at or (212) 247-6980.

• Learn your econ, with a new curriculum published especially for home schoolers by the Acton Institute. It’s a 16-week course called: Economics in a Box.

• Get on the Values Bus, which next week rolls through the Midwest: Monday – Columbus, Norfolk, and Sioux City, Neb.; Tuesday – Sioux Center and Sheldon, Iowa; Thursday – Sunset Hills, Mo.; Friday - Town & Country, Mo.

Posted on 05/04/12 03:43 PM by Alex Adrianson

Chen Guangcheng’s Battle Against Forced Abortion

Chen Guangcheng’s flight to the U.S. embassy two weeks ago followed years of harassment from government officials who feared Chen’s efforts to make them accountable to the law. From a profile by Peter Finn (Washington Post, May 3):

Chen’s decision to challenge the authorities in court ultimately led to a four-year prison sentence on what human rights groups called trumped-up charges. When he was released in September 2010, Chen was immediately subjected to a new form of incarceration — an unofficial, even unacknowledged, house arrest.

His modest farmhouse in a village outside Linyi city, about 400 miles southeast of Beijing, was surrounded by high walls and cellphone jammers. His detention was enforced by a band of police officers and locally hired thugs. […]

For a time, his activism was tolerated. Chen was not a traditional democracy advocate. He did not attack the Communist Party or the system but repeatedly exposed failures to abide by the law as it was written.

When Chen stood up against the ostensibly illegal but widespread use of forced sterilization and forced abortions, however, he became a target for the provincial government in Linyi, a city of 10 million people.

Local people described women who were eight months pregnant being forced to have abortions. One or both parents of two children were forcibly sterilized, and relatives were held hostage until they complied, Chen reported. All this happened even though the government had outlawed coercion to achieve its development and population goals. […]

The Chinese authorities, when asked, insisted he was a free man.

“I was in a small prison, and now I am in a larger prison,” said Chen in a video that was smuggled out, an act that brought such a severe beating that the dissident was left unconscious, human rights groups said.

Posted on 05/04/12 02:59 PM by Alex Adrianson

Government Is a Growth Industry

For more visuals on federal finances, see the new Web site Federal Budget in Pictures.

Posted on 05/04/12 01:03 PM by Alex Adrianson

Time for a Laugh

A new book by Chris Mooney claims conservatives’ brains don’t work as well as those of liberals. Jonah Goldberg (USA Today, May 1) breaks down Mooney’s argument, but the following observation may suffice to give a flavor: “Mooney claims Republicans have trouble processing reality because Republicans think ‘ObamaCare’ will raise the deficit. No really, stop laughing.”

Posted on 05/04/12 12:46 PM by Alex Adrianson

SUVs Aren’t Designed for Combat

Armored vehicles would have come in handy for the reconstruction effort in Iraq. Col. Kerry Kachejian, an army reserve engineer, describes his experiences in Iraq:

Posted on 05/04/12 11:23 AM by Alex Adrianson

Stagnation Story Is False

The argument for more income redistribution is not so compelling when you look closely at how income inequality is measured. The argument usually begins with the work of Thomas Piketty and Emmanuel Saez, whose survey of tax returns shows income stagnation at the bottom and robust growth at the top of the scale, as shown in the far-left column below (via James Pethokoukis, Enterprise Blog, April 11):

But looking at pre-tax income ignores the impact of government transfers and taxes. Also ignored by this method is the value of employer provided health insurance—clearly a part of income but not taxable by law. As health care eats up a bigger portion of the economy, the value of being insured grows over time and comprises a larger share of income for those at the bottom of the income scale than those at the top.

Further, tax returns vary in the number of people they cover. The distribution of income across tax returns may reflect variation in size of tax units more than variation in resources available to individuals.

Economists Richard Burkhauser of Cornell University and Jeff Larrimore with the congressional Joint Committee on Taxation, along with professor Kosali Simon of the Indiana University School of Public and Environmental Affairs have produced a different picture of income distribution using the Census Bureau’s current population survey. Their results are shown in the right hand columns of the table above. The far-right column shows income growth when all taxes and transfers and the value of health insurance is counted, and the results adjusted for the changing size of households.

While the top 20 percent has gained relatively more than other income groups, the disparity is not nearly as great as that found by Piketty and Saez. Every income group has gained since 1979.

Posted on 05/03/12 07:20 PM by Alex Adrianson

The Most Valuable Exports Might Be Institutions

Hong Kong might soon get some stiffer competition in the economic freedom rankings. Officially part of China, Hong Kong has its own set of legal and political institutions that have helped the province consistently achieve a No. 1 ranking in both The Heritage Foundation/Wall Street Journal Index of Economic Freedom and the Fraser Institute’s Economic Freedom of the World Report.

Honduras has decided to try to replicate Hong Kong’s path to prosperity by creating special development zones that will in effect import better legal institutions—i.e., transparent and predictable rules administered impartially—that will encourage investment and job creation.

The idea comes from Paul Romer and Brandon Fuller who recently published a paper on the concept for Canada’s MacDonald-Laurier Institute, “Success and the City: How Charter Cities Could Transform the Developing World.”

The idea is to get around the vested interests that make it exceedingly difficult to transform existing institutions. The new zones—called “la Región Especial de Desarrollo,” (RED) in Honduras—will be completely new cities. Hondurans who want to live under the new rules will be able to move to REDs, but nobody will be forced to live there. Third-party countries will help these zones run the police and courts.

In the Globe and Mail (April 25) Romer and Octavio Sanchez, chief of staff to the President of Honduras, urge Canada to participate in helping Honduras implement the charter cities concept. Noting that, according to Gallup, 45 million adults worldwide would move to to Canada if given the chance, they argue: “The world does not need more aid. […] [I]t needs more Canada – more of the norms and know-how that lead to the rule of law, true inclusion and real opportunity for all.”

Canada, by the way, ranks sixth in the world in economic freedom.

Posted on 05/02/12 05:56 PM by Alex Adrianson

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