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InsiderOnline Blog: June 2010

How Soccer Is Like Socialism

The United States was eliminated from World Cup competition over the weekend, but still made it further than the French team, whose performance was such a scandal that the French government is now holding hearings on what went wrong. (Hint: The team went on strike—something labor unions also tend to do!) The United States, so dominant in other sports, seems little bothered by its bow out to Ghana.

That the French care so much as to think government should get involved is but one sign that soccer is a socialist sport. Marc Thiessen aptly sums up some other reasons at The Enterprise blog, noting for example that soccer is the only sport that outlaws (except for goalies) the use of the one tool that separates man from beast: opposable thumbs.

As a result, it’s not uncommon for a team to play 90 minutes without scoring even one goal. To our way of thinking, that’s the biggest similarity between soccer and socialism: neither rewards hard work.

Posted on 06/30/10 04:18 PM by Alex Adrianson

America’s Limitless Welfare State

Is it possible to put limits on the welfare state or will America become a European-style social democracy? Claremont Institute fellow William Voegeli addresses this question at a recent Heritage lecture on his new book Never Enough: America’s Limitless Welfare State:

Posted on 06/29/10 06:28 PM by Alex Adrianson

The Founders’ Most Important Idea

In this third  installment of our series highlighting the thoughts of conservative and libertarian leaders on American Independence and the Founding, we asked: What do you think was the most important idea of the Founders? (This series will continue until July 4.)

Jamie Radtke, Chairman of the Virginia Tea Party Patriot Federation: In my opinion, one of their most significant achievements was the idea of a written constitution. Our U.S. Constitution was designed to serve as a limitation on federal powers, which is what makes it unique and powerful. It provides for a federal separation of power among three branches of government as was advocated by the French philosopher Montesquieu in his work, The Spirit of the Laws. Thus, unlike a parliamentary form of government, power is divided among an independent legislature, a chief executive and an independent judiciary. Additionally, the Bill of Rights guarantees the fundamental rights of the people and the states and further defines the boundaries of power of the federal government. This brilliantly composed document struck a remarkable balance of affirming our natural rights while establishing justice, safety, and a well-ordered society.

The Founders were sensitive to government’s proclivity to usurp the power of the people and therefore were very intentional in how they crafted these constitutions to safeguard our individual liberties. It is now our responsibility to preserve the original intent of the Constitution, restore federalism, and protect the unique treasure that was given to us by our Founding Fathers.

Matthew Mayer: President of the Buckeye Institute for Public Policy Solutions: Without a doubt, the single greatest idea of the Founders is the system of checks and balances established in the Constitution. From 1787 to 1913, this amazing system allowed America to rise from a largely agrarian country to one of the world’s powers on the eve of World War I. During those 126 years, the federal government really was largely constrained and the states played dominant roles in the lives of their citizens. All of that changed in 1913 when Americans unwisely passed the 17th Amendment that fundamentally changed the balance of power between the states and the federal government. With the direct election of U.S. Senators, states lost the only real check they had on the growth and usurpation of power by the federal government. That seemingly insignificant change made to reduce corruption at the height of the Progressive Movement, ironically has resulted in an unchecked federal government with almost limitless powers and the attendant corruption that comes with great power.

ObamaCare illustrates this reality perfectly as states are left to try to undo what their own senators voted for/rammed through despite the costs ObamaCare will pose on states. Now, states desperately cling to the pre-1937 interpretation of the Commerce Clause—it only took 20 years or so for the federal government to realize the power it gained in 1913—and senators ignore the wishes of their constituents—the states, not the people in the states—knowing that the diffusion of the cost is outweighed by the concentration of the benefit. If we want to get America back on course, we should repeal the 17th Amendment, thereby making state legislative races far more important than they are today.

Matthew J. Brouillette, President of the Commonwealth Foundation for Public Policy Alternatives: America’s founding was shaped by the radical declaration that our right to private property was and is inherent and inalienable. This hostile idea, embodied in our Founding documents, challenged the historical practice of man’s rights being determined, limited, and granted by the state. This reorientation of the grantor of rights—from our Creator rather than those in authority—dramatically redefined who was sovereign while simultaneously placing chains on the powers of government. The state would now be the protector—rather than the arbiter—of man’s inherent and inalienable rights to life, liberty, and the fruits of his labors.

Ginni Thomas, President of While the Founders understood that men were not angels, they also recognized the inherent danger of powerful, centralized government. The simultaneous recognition of both of these principles is remarkable and formed the philosophical foundation for our system of limited Constitutional government. This foundation provided for the greatest degree of individual liberty within a robust independent civil society that could form, naturally, a just and successful society.

Thomas J. Gaitens, Florida Tea Party Leader: The phrase “Endowed by their creator with certain unalienable rights” has to be the most significant idea, revolutionary idea. This simple yet profound idea is the seed by which LIFE, LIBERTY and the PURSUIT OF HAPPINESS spring. Furthermore, it is this principle that brings us the irreplaceable conclusion that “Governments are instituted among men …” This concept of unalienable rights, known as the rights of man is the building block of Liberty. Our Hale rallying cry, of “Give me Liberty or Give me Death” embodies this and has been our chief export for 233 years. Failure to understand this byproduct of our Founding is failure to understand American Exceptionalism.

Posted on 06/28/10 05:21 PM by Alex Adrianson

Is Judicial Activism in the Eye of the Beholder?

Confirmation hearings for Supreme Court nominee Elena Kagan are set to begin on Monday. The discussion below should be helpful in sorting out arguments about judicial activism.

Another helpful resource, for those with the ambition to dig into raw data, is the Sunlight Foundation’s searchable database of the Kagan e-mails that were recently released to the public.

Posted on 06/25/10 09:44 AM by Alex Adrianson

Favorite Stories about the Founding

In this second installment of our series highlighting the thoughts of conservative and libertarian leaders on the American Founding, we asked: Do you have a favorite story about America’s Founding? (This series will continue until July 4.)

Eric O’Keefe, Chairman of the Sam Adams Alliance: The Boston Tea Party happened during a time of very low taxes, and the tea in the harbor had the lowest price of any tea from Britain for years, because the British government sharply lowered the duties on the tea, while retaining a modest tax. The duty and the tax both went to the British government, but the patriots had drawn a line that did not define duties as taxes. So the British imposed that tax not to raise revenue, but to exercise their claimed authority to be able to impose whatever taxes they wanted. The Boston Tea Party was conducted entirely based on a principle; taxes were low, not high. But the patriots viewed their local control of government and taxes as an essential anchor for their liberty, so they rebelled at a violation of a basic principle.

Gary Palmer, President of the Alabama Policy Institute: One of my favorite stories about America’s founding also involves my favorite Founding Father—George Washington. Perhaps Washington’s greatest test occurred in March, 1783 in response to the Newburgh Conspiracy. Joseph Ellis, in his biography entitled His Excellency George Washington, called this the “The Last Temptation of Washington.” During the War for Independence in 1780, the Continental Congress enacted a resolution to give veteran officers a pension of half pay for life. However, by the winter of 1782-83, it was evident that Congress did not have the revenues to fund their promise nor did they have any real prospects for raising the money. Congress then passed a resolution cutting the pension to full pay for five years which they could not pay either.

These actions resulted in a petition being circulated among Washington’s officers that included implied threats against Congress if the officers’ pensions were not assured. The threats ranged from a coup by members of Congress sympathetic to the plight of the officers and supported by a more moderate group of Washington’s officers to an outright army takeover of the government which had the support of more radical officers. The leaders of the two groups scheduled a meeting for March 11th, but Washington cancelled the meeting and scheduled another meeting for all officers on March 16th.

It was at this meeting, attended by about 500 officers, that Washington gave the greatest demonstration of his character. Unlike other military leaders who used their power and influence to make themselves dictators, Washington did not take advantage of the opportunity to overthrow Congress and take control of the government. As Ellis wrote, though sympathetic to the plight of his officers, Washington “established a link between his own honor and reputation and the abiding goals of the American Revolution.” Every man in the room understood that an assault on Congress would be an assault on Washington’s own honor and integrity. Washington’s speech declared his convictions that the entire war had been about a fundamental principle … that all legitimate governmental power was derived from the consent of the people. To overthrow the government of the people would be to destroy all that they had fought for.

As convincing as his speech was to be, Washington changed the disposition of every man present before he uttered one word of it. Just prior to reading his speech, Washington reached inside his waistcoat to pull out a pair of spectacles. As he looked out to his assembled officers, who had not seen him in need of them before, he said, “Gentlemen, you will permit me to put on my spectacles, for I have not only grown gray, but almost blind in the service of my country.” At that point several officers began to weep. The entire mood among the assembled men changed. Without uttering a word of his speech, the Newburgh Conspiracy was ended and the fledgling American Republic was saved.

Matthew Spalding, Director of the B. Kenneth Simon Center for American Studies at The Heritage Foundation: One of my favorite stories is from an interview I discovered in the course of writing my recent book [We Still Hold these Truths]. It is with Levi Preston of Danvers, Massachusetts. He was in his early twenties in the spring of 1775 when he fought at the Battle of Concord, at the opening of the American Revolution.

As is often the case with stories or quotes, the best are those that capture an idea.

Many years later, Captain Preston was asked why he went to fight that day. Was it the intolerable oppressions of British colonial policy, or the Stamp Act? “I never saw any stamps.” What about the tax on tea? “I never drank a drop of the stuff; the boys threw it all overboard.” It must have been all your reading of Harrington, Sidney, and Locke on the principles of liberty? “Never heard of ’em. We read only the Bible, the catechism, Watt’s Psalms and Hymns, and the Almanack.” Well, what was it? asked the interviewer. What made you take up arms against the British?

“Young man, what we meant in going for those redcoats was this: we always had governed ourselves, and we always meant to. They didn’t mean we should.”

Today when we think of self-government, we usually have in mind the various forms of political participation, like voting in elections or serving on a jury. These activities are a very important aspect of the concept. But in addition to these practices, the Founders meant the preconditions that were required for the success of that process and that fulfilled man’s higher purpose beyond the limited ends of government.

The Founders understood self-government in the twofold sense of political self-government, in which we govern ourselves as a political community, and of moral self-government, according to which each individual is responsible for governing himself. They believed that the success of the former required a flourishing of the latter. Individuals could not govern themselves as a body politic unless they were each first capable of governing themselves as individuals, families, and communities.

Moral self-government both precedes and completes political self-government, and thus political freedom. It is in this sense that the primary as well as the culminating first principle of American liberty is self-government—an idea wonderfully captured in this simple quotation from a man long forgotten but who understood it, who fought for it.

Posted on 06/25/10 09:29 AM by Alex Adrianson

Five Years Later, Property Rights Stronger Because of Kelo

Wednesday (June 23) was the fifth anniversary of the Supreme Court’s Kelo v. New London decision, which held that government taking of private property for the purpose of economic development does not violate the U.S. Constitution as long as the taking occurs as part of a comprehensive development plan. A new paper by the Institute for Justice reports the good news of the past five years: The Kelo decision produced such a strong backlash that many states reformed their eminent domain laws to provide greater protections to property owners. IJ notes:

• Citizen activists defeated at least 44 projects that sought to abuse eminent domain for private gain in the five-year period since Kelo.
• Forty-three states improved their laws in response to Kelo, more than half of those providing strong protection against eminent domain abuse.
• Nine state high courts restricted the use of eminent domain for private development since Kelo while only one (New York) has so far refused to do so.
• The New London project for which the property was taken in Kelo has been a complete failure and is now Exhibit A in what happens when governments engage in massive corporate welfare and abuse eminent domain. Although the project failed, Susette Kelo’s iconic little pink house has been moved to downtown New London and preserved. It still stands as a monument in honor of the families who fought for their rights and who inspired the nation to change its laws to better protect other property owners.


The Institute for Justice used to get continual requests for assistance in fighting eminent domain for private gain. Now, we receive far fewer. Of those, many are defeated by activism in the court of public opinion before they ever reach a court of law. Eminent domain abuse used to be a nationwide epidemic with more than 10,000 instances reported in just one five-year period alone, an epidemic that affected property owners in most states. Now, it is largely a problem confined to certain reform-resistant states, like New York, that refuse to change their laws or listen to their own citizens. The Institute is focusing its efforts in litigation and advocacy in those states. [Internal citations omitted.]

And here’s an IJ video describing the accomplishments of the movement since Kelo:

Posted on 06/24/10 06:46 PM by Alex Adrianson

School Choice Students in Nation’s Capital Have Higher Graduation Rates

There are some very positive findings on the D.C. Opportunity Scholarship program in the latest and final evaluation of the program. In particular, the report—commissioned by the Department of Education—found that students offered a scholarship by the program had a graduation rate of 82 percent, which is 12 percentage points higher than students who did not receive a scholarship. Previous research has shown that those who graduate from high school tend to have higher lifetime earnings and to live longer, and are more likely to avoid prison and having children out of wedlock than are students who fail to graduate from high school.

The report does say: “There is no conclusive evidence that the [program] affected student achievement.” Education expert Matt Ladner, writing at Jay P. Greene’s blog, explains why this top-line conclusion isn’t quite right:

In the final report, the reading achievement findings just miss the Department of Education’s threshold for statistical significance. … Last year’s (third year) report DID find conclusive evidence that the Program raised student achievement in reading. A close read of this year’s final report reveals that the sample size of students in the final year was smaller because a number of the students participating in the study had graded-out of the Program. It’s not surprising then that the statistical significance of the reading effects fell just short of the required level. Still, with a p-value of .06, we can say that we are 94% certain that the treatment group did outperform the control group in reading in the final year. Moreover, the final report found statistically significant achievement gains for 3 of the 6 subgroups they examined.

Posted on 06/24/10 03:07 PM by Alex Adrianson

Spending Is the Problem

For past 50 years, the federal budget has averaged an annual deficit of 2.3 percent of gross domestic product. In the year 2020, that figure is projected to rise to 8.3 percent of GDP. As the chart below shows, increases in spending (red line) are driving the massive budget deficits over the next decade.


This chart comes from Brian Riedl’s paper “The Three Biggest Myths About Tax Cuts and the Budget Deficit,” The Heritage Foundation, June 21, 2010.

Posted on 06/24/10 01:03 PM by Alex Adrianson

The Socialist Behind the Idea of Government Funding for News

Michael Copps, a Federal Communications Commissioner, warns that if you propose government funding for newspapers, then “[s]ome guy is probably going to be on cable screaming up and down saying you’re Mao Zedong.” He seems to be scoffing at the notion that such funding is akin to a totalitarian effort at thought control. But should he be so sure?

Copps himself cites the ideas of Robert McChesney, a professor at the University of Illinois and founder of the group Free Press. Randolph May writes about McChesney at the Free State Foundation blog, noting some quotes that show McChesney clearly embraces the socialist label for himself. More importantly, the quotes reveal that McChesney sees government funding of news as essential to the socialist project to overthrow capitalism. For example, he has written:

Instead of waiting for the revolution to happen, we learned that unless you make significant changes in the media, it will be vastly more difficult to have a revolution. While the media is not the single most important issue in the world, it is one of the core issues that any successful Left project needs to integrate into its strategic program.

So that’s the provenance. McChesney’s notion of what kind of journalism deserves taxpayer support is tied to his political preferences. How could government funding of news not end up being used by those in power for political purposes? May has more thoughts on this topic at the Free State Foundation blog.

Posted on 06/23/10 04:31 PM by Alex Adrianson

What’s the Best Reading on the Founding?

We’ve solicited some thoughts on the American Independence and Founding from a variety of conservative and libertarian leaders. Between now and July 4, we’ll post some of the most interesting answers. Here is the first installment.

What is the single best book or article you have read about the American Founding?

Matt Mayer, President of the Buckeye Institute for Public Policy Solutions: Outside of the fairly obvious The Federalist Papers, the Constitution, and the Declaration of Independence, I’d have to settle on Russell Shorto’s The Island at the Center of the World: The Epic Story of Dutch Manhattan and the Forgotten Colony That Shaped America. Short’s excellent book is a timely reminder for all Americans of the vital role the Dutch played in our country’s founding. Two of the principles that make America exceptional come directly from the Dutch settlement of New Amsterdam/New York

First, the long Dutch history of tolerance that became the basis of the First Amendment’s Free Exercise and Establishment Clauses. Many Americans likely forget that the Pilgrims didn’t come directly from England to America; rather, the Pilgrims left the intolerance of England for the tolerance of Leiden, The Netherlands. From Leiden, the Pilgrims came to America. Our Founding Fathers adopted this Dutch tolerance when they wrote and ratified the Constitution, thereby making America the destination of the world’s oppressed for four centuries.

Next, under the Dutch leadership, New Amsterdam itself started as a melting pot of many nationalities who came together and built a city that eventually became one of the world’s greatest cities. Of course, it was rough and violent in the early days, but it eventually became a functioning city of New Yorkers. This early adoption of a melting pot mentality helped America develop into the world’s first real country of immigrants. New Amsterdam, as New York, famously became the center of the New World’s entry point for new immigrants with the Statute of Liberty welcoming all. As Frank Sinatra sang in 1980, but really established in the early 1600s, if you could make it in New York, you could make it anywhere.

So, although Shorto’s great book doesn’t really cover the 1787 founding era, it really does go to the heart of America’s early founding and two of the core principles that have made this country the world’s “last, best hope.”

Lawrence W. Reed, President of the Foundation for Economic Education: Forrest McDonald’s Novus Ordo Seclorum: The Intellectual Origins of the Constitution is the best book on the American Founding that I’ve read. McDonald explains superbly well the ideas percolating in the minds of the Founders in the 1780s and how those ideas affected their debates and work on the construction of the Constitution. To understand what the Founders did, one should understand why they did it and McDonald spells it out better than any other authority of the era.

David Boaz, Executive Vice President of the Cato Institute: My favorite book on the Founding is Bernard Bailyn, The Ideological Origins of the American Revolution. Bailyn shows the sources of American Revolutionary thought, placing special emphasis on Lockean radicalism, as transmitted through the libertarian ideas of Trenchard and Gordon, the authors of Cato’s Letters (for which the Cato Institute is named). A shorter summary of Bailyn’s thesis of the transforming libertarian radicalism of the Revolution can be found in his essay “The Central Themes of the American Revolution: An Interpretation” in Stephen G. Kurtz and James H. Hutson, eds., Essays on the American Revolution, where Bailyn writes: “[T]he major themes of eighteenth-century radical libertarianism [were] brought to realization here. The first is the belief that power is evil, a necessity perhaps but an evil necessity; that it is infinitely corrupting; and that it must be controlled, limited, restricted in every way compatible with a minimum of civil order. Written constitutions; the separation of powers; bills of rights; limitations on executives, on legislatures, and courts; restrictions on the right to coerce and wage war—all express the profound distrust of power that lies at the ideological heart of the American Revolution and that has remained with us as a permanent legacy ever after.”

When I am being provocative with conservative audiences, I ask: What does it mean to be a conservative in a country founded in libertarian revolution? If it means conserving the principles of the Declaration of Independence and the limited government of the Constitution, then an American conservative is a classical liberal or a libertarian.

Posted on 06/23/10 11:55 AM by Alex Adrianson

Petition Says Tear Down the Stalin Bust

A petition has been launched calling for the removal of Joseph Stalin’s bust from the National D-Day Memorial in  Bedford, Va. The folks behind the decision to include the Soviet dictator’s bust alongside those of Winston Churchill, Franklin Roosevelt, and Harry Truman apparently reasoned that since Stalin was fighting Germany, too, he deserves some recognition. It doesn’t seem to matter to them that Stalin was allied with Hitler before he was against Hitler, nor that Stalin’s victory over Hitler simply replaced Nazi subjugation of Eastern Europe with Soviet subjugation. In their view, Stalin deserves a place alongside the liberators who landed at Normandy on June 6, 1944. If you disagree with that decision, then you should consider signing the petition.

Right now, folks closer to Stalin’s birthplace seem decidedly less keen on him than the memorial makers in the United States. Yesterday, in fact, Georgian authorities removed from Stalin’s hometown of Gori a 20-foot bronze statue of the dictator that had sat on a soaring granite plinth since 1952. A memorial to the victims of Russia’s 2008 aggression will be placed there instead. “A memorial to Stalin has no place in the Georgia of the 21st century,” said Georgian president Mikhail Saakashvili. [Report by the Telegraph]. But in the United States …

Posted on 06/23/10 11:15 AM by Alex Adrianson

Has Your Organization Excelled in Promoting Freedom This Year?

The deadline for entering the Templeton Freedom Awards is fast approaching: July 2. Every year, these awards recognize some of the best work done by think tanks around the world to advance individual liberty, free markets, and civil society. The awards are a program of the Atlas Economic Research Foundation and are supported by the John Templeton Foundation. Among the categories of awards are solutions to poverty, student outreach, innovative media, and special achievement by a young institute. Check out the application instructions to see if there is a category for which your organization should be considered. And don’t forget, the deadline is July 2.

Posted on 06/22/10 02:41 PM by Alex Adrianson

What Washington Can Learn from Sports

“What Washington can learn from outside the beltway” is always a good theme, and in his latest book, former Virginia Gov. George Allen draws inspiration from the world of sports. (Allen’s father, of course, was the head coach of the Los Angeles Rams and also the Washington Redskins.)

Posted on 06/21/10 06:15 PM by Alex Adrianson

Get Your Budget Facts Here ... and Then Speak Out

Next Saturday, June 26, will hold a national townhall on the federal budget. We encourage everyone to participate, and to come prepared with facts. Here’s a few good ones.

Immediately before the current recession, Washington spent $24,800 per household. Simply returning to that level (adjusted for inflation) would likely balance the budget by 2019 without any tax hikes.
The federal government made at least $98 billion in improper payments in 2009.
Washington spends $92 billion on corporate welfare (excluding TARP) versus $71 billion on homeland security.
Washington spends $25 billion annually maintaining unused or vacant federal properties.
Government auditors spent the past five years examining all federal programs and found that 22 percent of them—costing taxpayers a total of $123 billion annually—fail to show any positive impact on the populations they serve.

These and other revealing facts on the budget can be found in Brian Riedl’s “Federal Spending by the Numbers 2010.” Also, for those who like quick talking points, check out Heritage’s latest fact sheet: “Enough Is Enough: Speak Out Against Tax Increases.” And for even more perspectives on the government’s spending problem don’t forget Heritage’s 2010 Budget Chart Book.

Posted on 06/18/10 09:16 AM by Alex Adrianson

Why the Escrow Demand?

A number of commentators have observed that the administration’s tough talk of criminal prosecution diminishes the prospect of cooperation between BP and the federal government. Another consideration, as Steve Chapman at Reason magazine notes, should be that criminal prosecution is about the only thing that could keep BP from paying its share of damages:

Estimates of the total costs of the spill range up to $70 billion, which sounds large only if you are not a multinational petroleum company. The oil giant had profits last year of nearly $17 billion, reports MSNBC, and its untapped reserves are worth $1.35 trillion. The quarterly dividend is just $2.6 billion. And BP won't have to bear the whole burden, since its partners on the Deepwater Horizon rig, Transocean and Halliburton, will probably be on the hook for a large portion of the damages.

So demanding that BP set aside $20 billion in an escrow account isn’t really relevant—unless the administration is planning to put BP out of business.

Posted on 06/17/10 08:54 PM by Alex Adrianson

We’re Still Finding Out What’s in the Law

Draft regulations clarifying what health plans will be considered “grandfathered” for the purposes of the Obamacare individual mandate, released this week by the Department of Health and Human Services, are the first of many edicts that will be forthcoming from HHS under the new law. Scott Gottlieb totes up how much power the law gives to the Secretary of HHS: “The ObamaCare law references the Secretary of Health and Human Services almost 2,200 times and uses the phrase ‘the secretary shall’ more than 725. Each reference requires HHS to set new rules on medical care, giving control to an existing federal office or one of 160 new agencies that the bill created.”

Posted on 06/17/10 07:37 PM by Alex Adrianson

Bargaining Away the First Amendment

Cleta Mitchell, a National Rifle Association board member, says the NRA is selling out the First Amendment by supporting the Democrats’ campaign finance proposals. The NRA this week agreed to drop its opposition in exchange for an exemption from some of the bill’s requirements. Mitchell, writing at the Washington Post, warns that this kind of deal making illustrates the very danger the First Amendment was supposed to prevent: “The NRA carve-out is a clear example of a congressional speech license. … The act serves notice on certain speakers that their involvement in the political process will exact a high price of regulation, penalty and notoriety, using disclosure and reporting as a subterfuge to chill their political speech and association. … It is a scheme hatched by political insiders to eradicate disfavored speech.”

Eight former Federal Election Commissioners made a similar argument last month in the Wall Street Journal. Among the problems they identified with the bill, it would require every 30-second political ad to contain at least six statements as to who is paying for the ad (which could eat up as much as half of every ad), require non-profits to either provide their membership lists to the government or restrict their political spending by creating a new type of political action committee, and require any business or organization making political expenditures to track its political activities with expensive, sophisticated Web sites that would be beyond the means of many small businesses and grass roots organizations. Plus, many of the bill’s new reporting requirements apply to corporations, but not to unions. Unions, of course, tend to give money to the Democrats.

Posted on 06/17/10 05:11 PM by Alex Adrianson

One-Size-Fits-All Insurance Arriving Soon

Draft regulations released this week by the Department of Health and Human Services are expected to reduce consumer choices even further under Obamacare. The law includes a “grandfather clause” that says in effect that the requirement to purchase health insurance doesn’t apply if you already have health insurance and maintain that coverage. Plans that are “grandfathered” will typically not be as expensive as the insurance that qualifies for meeting the individual mandate under HHS regulations. But what counts as “maintaining” your coverage? HHS’s draft regulations propose an answer. Marc Siegel, writing at Forbes, describes them this way:

[T]he regulations impose a major vise on private insurance, restricting a company’s ability to increase cost sharing (such as coinsurance, deductibles and out-of pocket limits) as well as copayments (“more than the sum of medical inflation plus 15 percentage points or $5 increased by medical inflation”). So it is unlikely that many insurers will be able to remain viable without raising premiums (not restricted by the regulations) or slashing services. … At the same time, the draft regulations would imposed such an inflexible restriction on employers—for group insurance, if an employer decreases its contribution rate by more than 5% it will lose its grandfather status—that it is likely that many employers will drop their insurance plans altogether. The draft’s own midrange estimates reflect this bleak new world, predicting that 66% of the insurance plans offered by small employers and 45% offered by large employers will no longer be legal by 2013. And the numbers are no better for individual policies. The draft estimates that individual policies relinquishing their grandfathered status by failing to comply with the new regulations will be from 40% to 67%.

Posted on 06/16/10 07:07 PM by Alex Adrianson

The Government Looks Out for Your Health, Except When It Doesn’t

On Tuesday, a federal panel tasked with updating the U.S. Department of Agriculture’s iconic food pyramid released a report suggesting, among other things, that people eat less fatty meats. Meanwhile, the Secretary of Agriculture announced that USDA will buy $14 million worth of dark chicken meat in order to help chicken producers hurt by a sharp drop in the price of dark chicken meat. According to news reports, the USDA plans to use the $14 million in dark (i.e., less lean) chicken meat in food banks, school lunch programs, and other food assistance programs.

So, people already prefer white chicken meat, which is better for them because it is leaner, but the government, in spite of its own recommendations, plans to make it relatively easier for people to obtain the more fatty chicken meat. Put another way, the government, through its power to subsidize, will now encourage choices that are less than optimal health-wise in order to satisfy a special interest. All we can say is, it’s a good thing there’s no special interests in health care, otherwise new government powers to dictate what kind of health insurance is acceptable and to subsidize its purchase could prove to be a disaster.

[Sallie James pointed out the incongruity in the USDA actions earlier at Cato-at-Liberty.]

Posted on 06/16/10 03:13 PM by Alex Adrianson

Free Enterprise Is a Cultural Issue

… explains American Enterprise Institute President Arthur Brooks:

Additional segments of Nick Schulz talking with Brooks about his new book cover topics such as why earned success is so important, the relationship between money and happiness, what Americans really think about free enterprise, and why Brooks wrote The Battle: How the Fight between Free Enterprise and Big Government Will Shape America’s Future.

Posted on 06/15/10 12:14 PM by Alex Adrianson

The Ways of Debt

State and local “outstanding debt has soared to $2.2 trillion today from $1.4 trillion in 2000. State and local borrowing as a percentage of the country’s GDP has risen to an all-time high of 22% in 2010 from 15%, with projections that it will reach 24% by 2012.” Now “the muni market has all the characteristics of a crisis that might unfold with ‘a widespread cascade in defaults.’”

Those sobering sentences come from Stephen Malanga’s brief Wall Street Journal review of municipal finance’s recent history. He points out that one of the key reasons for the current state of affairs is that after voters wised up following the municipal debt crisis of the 1970s and started rejecting debt-financed projects, the politicians began figuring out ways to get around the voters. For example:

In 2000, Massachusetts moved to make the entity that runs Boston area mass transit, the Massachusetts Bay Transportation Authority, financially independent. As part of the plan the authority was supposed to gradually pay down some $5.6 billion in debt and use cash from operations to finance capital projects.

Instead, the agency deferred payments on its debt, put off capital projects, and borrowed more money, so that it now owes $8.5 billion. Today, the authority is paying a staggering $500 million yearly in debt service, forcing it to neglect maintenance, shelve expansion plans, and cut service. Even so, last year the agency needed a $160 million bailout from taxpayers to close a budget deficit.

Posted on 06/14/10 06:24 PM by Alex Adrianson

Baseline Budgeting Meets Global Warming Politics

The Copenhagen Conference continues to underwhelm: Developing nations now worry that the developed countries will renege on their pledges to provide $30 billion to help developing countries mitigate global warming, reports the Guardian. The Copenhagen Conference disappointed global warming activists because it failed to produce anything like a binding regime limiting carbon emissions. What little was agreed to—essentially a statement that it would be nice if each country decided on its own to reduce its emissions—came at a price: Developing nations, who rightly care more about economic growth than reducing carbon emissions, demanded and got a pledge of aid for global warming mitigation from developed countries. The Guardian, citing a paper by the International Institute for Environment and Development, warns that “[r]ich countries will raid existing aid budgets, double-count promises and convert grants to loans to avoid paying the $30bn” unless their promises are judged against a measurable baseline. The concerns, reports the Guardian, threaten to undermine further negotiations.

But maybe there’s no real conflict of interest here: Carbon caps will limit economic growth in developed as well as in developing nations because all economic activity requires using energy, and carbon-based energy remains the most inexpensive source. For example, David Kreutzer and colleagues at The Heritage Foundation estimate that the cap-and-trade bill introduced last year by senators Barbara Boxer (D-Calif.) and John Kerry (D-Mass.) will cost the U.S. economy $9.9 trillion cumulatively by the year 2035.

Posted on 06/11/10 10:36 AM by Alex Adrianson launched this week. The site promises to “[pull] together all of the best evidence and analysis about the legislation, as well as relevant news items and commentary, in an accessible and searchable format for anyone to use as they need to” and “to provide Americans with the facts so that they can hold those who sponsored and passed ObamaCare accountable for what they have done.”

James Capretta, a fellow at the Ethics and Public Policy Center, directs the project for the group e21. Capretta’s lead essay gives a good rundown of recent revelations confounding the promises made on behalf of Obamacare.

Posted on 06/10/10 02:39 PM by Alex Adrianson

Remember Resource Bank?

Remembering just got easier: Pictures, audio, and video from Resource Bank 2010 are now available.

Posted on 06/10/10 01:24 PM by Alex Adrianson

The Road to Serfdom Ranks First Among All Books at Amazon

The Road to Serfdom, Friedrich Hayek’s classic book showing how a government-planned economy threatens both individual liberty and constitutional government, reached number 1 among all books at today (June 9). The book, a bestseller in 1944, has had strong sales all year, thanks partly to a rap video about the Hayek-Keynes economic debates that went viral, and to John Stossel talking about the book on his television show in February. But the book got a really big boost after Glenn Beck talked about it on his program yesterday. The Road to Serfdom is the essential statement of how a desire for a planned economy produces a program at odds with democratic safeguards for liberty. If people are reading it, it’s probably because they’re paying attention to the drift of things.

Posted on 06/09/10 07:28 PM by Alex Adrianson

$10 Million in Free Advertising for Free Market Think Tanks

Glenn Beck is giving the work of think tanks millions of dollars worth of free advertising—obliquely. The title of his new novel is The Overton Window, and it refers to a theory of social change put forward by Joe Overton, former vice president of The Mackinac Center in Midland, Michigan. In brief, the theory holds that politicians choose from a narrow range of policies that are politically acceptable, but over time the window of political possibility can be shifted. The theory directs our attention to the importance of shifting that window in the direction of greater freedom rather than worrying about the latest election cycle. That’s what free market think tanks exist to do.

Joseph Lehman, president of the Mackinac Center, had previously developed a presentation based on this idea, and now the Mackinac Center is primed to take advantage of the derivative publicity over Beck’s novel. Mackinac has created a Web page explaining the Overton Window, and has beefed up its servers and engaged a call center to help handle the spike in interest it expects. Mackinac plans to capture contact information of all interested visitors and it wants to help non-Michigan residents find their state-based think tank. Lehman says he thinks Beck’s title amounts to $10 million worth of free advertising. To help maximize this opportunity for the movement, please consider linking to the Overton Window Web page, sending an e-mail about it to your regular readers, creating an e-mail footer mentioning the page, or liking the Overton Window Facebook page.

By the way, Beck had Lehman on his program to talk about the Overton Window on Wednesday. You can see a clip of the interview, and there’s a transcript available, too. Also, a number of state-based think tanks have posted stories about the concept of the Overton Window, including the Evergreen Freedom Foundation in Washington, and the Sutherland Institute in Utah.

Posted on 06/08/10 05:36 PM by Alex Adrianson

Welcome to Government Burger …

One little noticed section (section 4205) of the Patient Protection and Affordable Care Act (Obamacare) instructs the Secretary of Health and Human Services to “[c]onsider standardization of recipes and methods of preparation, in reasonable variation in serving size and formula of menu items, space on menus and menu boards, inadvertent human error, training of food service workers, variations in ingredients … .” [From the Galen Institute weekly newsletter, June 4, 2010.]

Posted on 06/08/10 04:01 PM by Alex Adrianson

Imagine a Machine that Converts Cheap Goods into Expensive Goods

We already have such a machine, explains the Atlas Economic Research Foundation’s Tom Palmer:

Posted on 06/08/10 02:58 PM by Alex Adrianson

Digging into Climategate

Brian Sussman’s Climategate promises to reveal the personalities and the agendas behind the sham science that has been perpetrated by global warming activists. You can hear Sussman, a veteran meteorologist, talk about his book next Tuesday at The Heritage Foundation.

Posted on 06/08/10 02:32 PM by Alex Adrianson

Thanks, Stalin

The historian Robert Conquest estimates that government-engineered famines, political show trials, brutal conditions in labor camps, and other devices of Soviet repression killed between 20 million and 30 million people during the rule of dictator Josef Stalin. A bust of this same dictator has now been placed alongside those of Franklin Roosevelt, Harry Truman, and Winston Churchill at the National D-Day Memorial in Bedford, Virginia. How could they do that? Sculptor Richard Pumphrey explained the decision: “He’s part of the narrative. We may not like Stalin, but if he had not challenged Hitler on the Eastern Front, then victories on the Western Front may not have been possible.”

Here’s the actual history lesson: In 1939, Russia and Germany signed a treaty carving up Eastern Europe while agreeing not to attack each other. Two years later, Germany attacked the Soviet Union. Only then did Stalin decide to “challenge” Hitler. By then, of course, Hitler had already conquered all of Western Europe, necessitating a cross-channel invasion to free it. Time magazine made Stalin its 1942 Man of the Year for turning Hitler back at Stalingrad. The magazine speculated at the time that Stalin “wants no new territories except at points needed to make Russia impregnable against invasion.” Of course, the end result of Stalin’s contribution to defeating Hitler was that all of Eastern Europe fell under Soviet domination. Do the designers of the memorial really think that is an accomplishment worth recognizing alongside those who sacrificed on D-Day?

Lee Edwards, chairman of the Victims of Communism Memorial Foundation, had this to say:

Clearly, the National D-Day Memorial Foundation knows it made a monumental mistake by including Stalin in its Memorial. It tried to justify its action by adding a plaque citing the tyrant’s “tens of millions of victims” and then to minimize it by privately installing the bust five days before the formal dedication of the D-Day Memorial on June 6.

But the Stalin bust remains as does the profound injury to the memory of those who launched a crusade for freedom in Europe in June 1944. The honorable thing for the National D-Day Memorial Foundation to do is to remove the bust without delay.

Posted on 06/07/10 07:35 PM by Alex Adrianson

Yes, There Are Two Americas

Compensation for government workers is out-of-control, explains Dan Mitchell in the short video below.

Posted on 06/04/10 04:43 PM by Alex Adrianson

A Quiz on the European Economy

Hilarious because it’s true:

Posted on 06/04/10 10:37 AM by Alex Adrianson

The Goal Is Success!

Those who want greater redistribution of income, writes Arthur Brooks, have conflated the value of money with the value of earned success. It’s the latter, he explains, that produces happiness:  

Earned success means the ability to create value through effort—not by winning the lottery, not by inheriting a fortune, and not by picking up a welfare check. It doesn’t even mean making money itself. Earned success is the creation of value in our lives or the lives of others. It is what drives entrepreneurs to take risks, work hard, and make sacrifices. It is what parents get from raising happy children who are good people. It is the reward we enjoy when our time, money, and energy go to improving our world.

People who feel they have earned their success are much happier than people who feel they have not. In the working world—as opposed to, for example, lotteries—success is typically earned through effort. In 1996, the General Social Survey asked 500 American adults the following question: “How successful do you feel in your work life?” Some 45 percent answered “completely successful” or “very successful.” The rest said that they were “somewhat successful” or less so. Among the first group, 39 percent said they were very happy in their lives. In the second group, just 20 percent said they were very happy. … The big problem is not that unhappy people have less money than others. It is that they have earned less success. The way for the poor man to earn his success is through a system that rewards merit, hard work, education, and street smarts. It is through a system that matches skills and passions; that penalizes free-riding, laziness, and poor judgment. It is, in short, the free-enterprise system. [“Happy Now?,” National Review Online, June 2, 2010.]

Posted on 06/04/10 10:20 AM by Alex Adrianson

Reform Must Come from Outside the Beltway

Jerry Ellig’s recent paper assessing ten years of the Government Performance and Results Act assembles some evidence that congressional appropriators have not been terribly interested in using measurements of government performance to make spending decisions. He notes, for instance, that after OMB instructed agencies to develop performance-based budget requests, the appropriators essentially told them to knock it off because appropriators didn’t find such information useful. While disappointing, this result should not be too surprising. As Ellig notes, the appropriator’s political interest lies in securing flows of federal dollars to his district, and making programs more efficient may actually threaten those flows. Information about government performance can help solve this problem, but only when the public can easily obtain such information and use it to demand change from their elected representatives. That’s why transparency efforts that put performance measurements online are so important. [See “Ten Years of Results from the Performance Act,” Mercatus Center, May 2010.]

Posted on 06/04/10 09:46 AM by Alex Adrianson

Four Questions: Robert Reilly on the Closing of the Muslim Mind

Robert Reilly has written a book called The Closing of the Muslim Mind: How Intellectual Suicide Created the Modern Islamist Crisis, recently published by ISI Books. In it, he traces the roots of modern Islamism to medieval intellectual debates within Islam over the relationship between God and reason. We asked a Reilly, a senior fellow at the American Foreign Policy Council, four questions about his book.

InsiderOnline: In your book, you argue that the antecedent to the Islamism we know today lies in the 11th century victory of the Ash’arites over the Mu’tazalites, which arrested efforts to assimilate Greek ideas about reason into Muslim thinking. How does understanding that intellectual wrong turn help us understand Islamism’s violent hostility toward the West?

Robert Reilly: The West is the bastion of reason—or, at least, it used to be. The West was thoroughly Hellenized, to the extent that Nietzsche could quip that Christianity was Plato for the masses. When Sunni Islam decisively rejected philosophy, it perforce rejected the West. This did not happen overnight, but by the time of the burning of Avicenna’s books in the public square of Cordoba in 1196 AD it was a done deal. Where did this leave Islam? Benedict XVI said in Regensburg that not only is violence in spreading faith unreasonable and therefore against God, but that a conception of God without reason or above reason leads to that very violence. That which is unreasonable is against God only if God himself is reason or logos.

The majority Sunni theological school denied that God is reason or is any way limited by reason. God can therefore act unreasonably, as can his vice-regent on earth—the caliph or ruler—and this is perfectly consistent with this view. Reason is not an adjudicator or even a guide in life. Muslim man is thrown back exclusively upon revelation, which, thanks to the denigration of reason, he has few tools to interpret with. This deformed theology gave this form of Islam an ingrained propensity to violence. It also created an ingrained antipathy to political orders that are based upon reason. The widely shared principle of Islamic jurisprudence is that “reason is not a legislator.” If this is so, why have legislatures? Legislatures, where people come together to reason about how they should be ruled, are a presumptuous affront to God’s exclusive rule, according to this theology. Therefore, Islamists declare that the greatest danger to their faith is democracy.

Of course, there is also the divine mission that Islam understands itself to be on to bring the entire world into submission to Allah. Historically, force was the principal means for doing this. It was through armed conquest that Islam came close on several occasions to bringing all of Europe into subjugation. The hostility to Christianity and Judaism exists doctrinally, and the denigration of reason gives that hostility violent scope.

IO: What are the most important consequences for Muslim societies themselves of this—as your title puts it—closing of the Muslim mind?

RR: These societies are profoundly dysfunctional because their access to reality has been cut off. Fouad Ajami exclaimed, “Wherever I go in the Islamic world, it is the same problem: cause and effect, cause and effect.” He was witnessing the effects of the denial of causality in the natural world that this theology asserts to protect its notion of God as radically transcendent and omnipotent. In its terms, God can only be omnipotent if no one else is so much as potent. This means that there are no secondary causes, as in natural laws—like gravity or fire burning cotton—just the first and only cause, God. He does everything directly. (The explicit denial of causality helps to explain the demise of science in the Islamic world. If there are no natural laws to discover, why go searching for them?) This, of course, also leaves man without any power over his own actions. As ibn Taymiyya said, “Creatures have no impact on God since it is God Himself who creates their acts.” What kind of political order do you suppose emanates from that view of things? Where is man’s free will?

IO: Do you see any parallels between Islamism and other totalitarian movements?

RR: It is not a matter of whether I see any parallels; the Islamists themselves call attention to how close their conception of an Islamist state is to Western totalitarianism. As Maulana Maududi wrote, “In reality Islam is a revolutionary ideology and programme which seeks to alter the social order of the whole world and rebuild it in conformity with its own tenets and ideals.”

Sayyid Qutb described Islam as an “emancipatory movement” and “an active revolutionary creed.” Hassan al-Banna regarded the Soviet Union under Stalin as a model of a successful one-party system. In a line worthy of Robespierre, Qutb said that a “just dictatorship” would “grant political liberties to the virtuous alone.” Islamism is inevitably on the march, proclaims Sudan’s Hasan al-Turabi, because, much as communism used to be, “it’s a wave of history.” In fact, Qutb said all liberation movements were welcome to his revolution: “[t]he Islamic doctrine adopts all struggles of liberation in the world and supports them in every place.” This is familiar rhetoric.

Ineluctably, if will and power are the primary constituents of reality—as they are in this theology—one will, in a series of deductive steps, conclude to a totalitarian regime. There is no other way out of it. The curious thing is that it does not matter whether one’s view of reality as pure will has its origin in a deformed theology or in a totally secular ideology, such as Hegel’s or Hobbes’s; the political consequences are the same. As Fr. James Schall has shown, the notion of pure will as the basis of reality results in tyrannical rule.

IO: Are there currently any reform movements that offer the hope that there may be a “Muslim Enlightenment” in the future?

RR: There were and are such lights, but many have been extinguished or forced to shine outside of Islam in exile. Islam has a rich past in rational theology and philosophy. However, this tradition has lost its traction within the Muslim world. There are those who are struggling to restore it. It is to these courageous people that my book is dedicated. They are, unfortunately, not a “movement.” As one Islamist said, “liberal Islam has no cadres.” And illiberal Islam has many.

The question is: Is there a constituency within the Muslim world that can elaborate a theology that allows for the restoration of reason, a rehellenization of Islam with Allah as logos? Can Islam answer the call from Samir Khalil Samir for “an Enlightenment, in other words, a revolution in thought that affirms the value of worldly reality in and of itself, detached from religion, though not in opposition to it”? It is idle to pretend that it would take less than a sea change for this to happen. If it does not, it is hard to envisage upon what basis Muslims could modernize or upon what grounds a dialogue with Islam could take place.

There are many Muslims who want to enter the modern world—with its modern science and modern political institutions—and also keep their faith. The past glories of Islamic civilization show that it was once able to progress. That progress was based upon a different set of ideas, antithetical to those of the Islamists. Unfortunately, the ideas gaining traction today are theirs—the Islamists’. That is the crisis. The answer that is sweeping the Islamic world today comes the al-Qaedists, neo-Kharijites, and Hanbalites. This is basically a theological problem, and it requires a theological solution. What Islam desperately needs today is its own Thomas Aquinas.

Posted on 06/04/10 08:32 AM by Alex Adrianson

Libertarian Robin Hood

Liberal movie reviewers have sussed out that Ridley Scott’s take on the Robin Hood legend is, as Karina Longworth of the Village Voice calls it, a “rousing love letter to the Tea Party movement.” How’s that? The New York Times A.O. Scott explains: “You may have heard that Robin Hood stole from the rich and gave to the poor, but that was just liberal media propaganda. This Robin is no socialist bandit practicing freelance wealth redistribution, but rather a manly libertarian rebel striking out against high taxes and a big government scheme to trample the ancient liberties of property owners and provincial nobles.”

David Boaz, at Cato-at-Liberty, has collected other review snippets from the usual liberal suspects. They’re down on the movie, but their descriptions make it seem worth watching. So does Boaz’s account which notes that Robin Hood “tells the king the people want a charter to guarantee that every man be ‘safe from eviction without cause or prison without charge’ and free ‘to work, eat, and live merry as he may on the sweat of his own brow.’” How often does Hollywood celebrate that?

Posted on 06/02/10 06:54 PM by Alex Adrianson

The Obamacare Subsidies on the Table

The subsidies available in the health-care exchanges to be created by Obamacare are so generous that as many 43 million workers could come out ahead by convincing their employers to end the company health plan, say Doug Holtz-Eakin and Cameron Smith. Holtz-Eakin and Smith, analysts at the American Action Forum, estimate that the number who will actually do so could be as high as 35 million, about three times what the Congressional Budget Office projects.

Under the new law, companies that don’t provide health insurance to their employees must pay a fine of $2,000 per worker, but that’s a very small amount compared to the subsidies that workers would then receive. In many cases both the company and its workers would come out ahead if the company stops offering coverage, pays the penalty, and uses a portion of its savings to give employees a raise. Employees would then have a raise plus the generous government subsidies, while the company would still save money. Holtz-Eakin and Smith work through those calculations (see the table on page 6 of their paper) and find that even for workers earning over $200,000, it would pay to have their employers end coverage.

If 35 million workers did make that choice, say Holtz-Eakin and Smith, then the costs of Obamacare to the taxpayer would be nearly $1 trillion higher over the next decade than projected by the CBO. Meanwhile, that many more Americans would face the shockingly high effective marginal tax rates that always come with income-based subsidy programs. [See “Labor Markets and Health Care Reform: New Results,” American Action Forum, May 2010.]

Posted on 06/02/10 04:22 PM by Alex Adrianson

National Debt, the Game

There’s an online game about the national debt that is currently being developed. It’s called U.O.Me., and it challenges players to figure out how to pay off the national debt. The game looks like a great way to teach people just how big a problem the national debt is. We’re looking forward to playing U.O.Me., but first the developers need a little start-up capital. You can see a trailer for the game at the project’s Kickstarter microfinance page. Take a look and consider making a pledge. U.O.Me. was chosen as “Most Likely to Succeed” in a competition at the recent Games for Change Festival.

Posted on 06/02/10 11:43 AM by Alex Adrianson

Optimistic Canadians

Thanks in part to the U.S. government’s recent spending binges, a group of Canadian authors say that Canada now has the better business environment. “If the United States continues on its current course,” write Brian Lee Crowley, Jason Clemens, and Niels Veldhuis, “Canada will find itself without peer as a magnet for investment, immigrants, innovation, and growth.” They make this prediction in their new book, The Canadian Century: Moving Out of America’s Shadow.

But the issue isn’t just fiscal overstretch by the United States. They point to what they call Canada’s “redemptive decade” from 1988 to 1997, when politicians of all political stripes supported a program of free trade, trimming the extensive Canadian welfare state, and reducing both taxes and the government’s debt burden. Despite some backsliding, those reforms will be the basis of Canada’s prosperity, say the authors.

They’re certainly right about the recent role reversal. In the latest issue of The Heritage Foundation’s Index of Economic Freedom, Canada ranks as the seventh freest economy in the world, one spot ahead of the United States. That’s the first time Canada has been ahead of the United States in the rankings, and most of that switch is attributable to a declining U.S. score.

[See also “It’s Finally Our Time,” an excerpt of The Canadian Century published by the National Post, May 26, 2010.]

Posted on 06/01/10 06:08 PM by Alex Adrianson

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