Tag: ronald reagan

Reagan’s Libertarian Spirit

At the Britannica Blog I take a look back at Ronald Reagan on the occasion of his impending 100th birthday (February 6):

Libertarians have mixed feelings toward Ronald Reagan. When we’re feeling positive, we remember that he used to say, “Libertarianism is the heart and soul of conservatism.”

Other times, we call to mind his military interventionism, his encouragement of the then-new religious right (“I know you can’t endorse me, but I endorse you.”), and his failure to really reduce the size of government. But the more experience we have with later presidents, the better Reagan looks in retrospect….

And in those moments we’re tempted to paraphrase the theme song of All in the Family and say, “Mister, we could use a man like Ronald Reagan again.”

Bonus: The entry contains links to Encyclopedia Britannica entries on such topics as libertarianism and individualism, normally available only to subscribers. More Britannica reflections on Reagan here. Some other Cato thoughts on Reagan here.

Government Program Immortality

Who said: “A government bureau is the nearest thing to eternal life we’ll ever see on this earth.”?

As political junkies know, that was Ronald Reagan at the 1964 Republican convention. The Internet attributes other similar quips to Reagan.

Reagan apparently borrowed the idea from Senator James F. Byrnes, who stated on the floor of the Senate in 1933: “The nearest earthly approach to immortality is a bureau of the federal government.”

My source is “Reorganization of Federal Administrative Agencies,” Congressional Quarterly, September 17, 1933. The article is a reminder that concerns about government waste, duplication, overlap, and inefficiency certainly did not start with Reagan. Government failure has been around a long time.

The CQ article notes that the 1932 Democratic platform called for “an immediate and drastic reduction of governmental expenditures by abolishing useless commissions and offices, consolidating departments and bureaus, and eliminating extravagance, to accomplish a saving of not less than 25 percent in the cost of the federal government.”

Alas, that leaner-government policy was not exactly the approach followed by FDR.

DREAM Act a Low-Risk, High-Return Option

In a perfect world, we wouldn’t need to consider bills such as the DREAM Act, approved by the House last evening and on tap for a vote in the Senate as early as today.

The Development, Relief and Education for Alien Minors Act would offer legal status to students who came to the United States illegally before they turned 16 and have lived here for more than five years. To gain legal status they would need to complete high school, and then two years of college or military service. Once implemented the act would legalize about 65,000 students a year.

If our immigration policy was more in line with what I’ve been advocating for years, we would not have the large population of illegal immigrants that we do today because more legal alternatives would have been available. And access to in-state tuition would not be such a big deal if our education policies more closely reflected the sound arguments of my colleagues at Cato’s Center for Educational Freedom. Alas, that is not the world we live in yet.

The DREAM Act would improve a less-than-ideal situation by legalizing a population that is primed to live the American dream, and is virtually guaranteed to bestow real blessings on our economy and society.

Critics of the DREAM Act, such as Rep. Dana Rohrbacher (R-CA), paint these kids as nothing but expensive liabilities and the act as nothing but a backdoor amnesty. Both charges are false.

Young immigrants eligible for the DREAM Act are a low-risk, high-return addition to America. Because they came here at a young age, they almost all speak English fluently and are at home in American society. The fact that they have completed high school and will be attending college makes it likely they and their descendants will pay more in taxes than they consume in government services during their lifetimes. With the U.S. birthrate hovering at the replacement level, these assimilated, immigrant students at the beginning of their careers will help the United States maintain a healthy growth rate in our workforce.

It is wrong to label the DREAM ACT “amnesty.” These kids did nothing wrong. In fact, most of them simply obeyed their parents when the family immigrated to the United States. They should not be punished for the actions of their parents.

The DREAM Act, like most other immigration-related bills, has become charged with partisanship. House Democrats voted overwhelmingly in favor of the bill last evening, Republicans lopsidedly against. Democratic leaders in Congress are certainly open to the charge that they are using the bill to attract Hispanic voters even though the chances of it passing the Senate and becoming law are, at the moment, slim. But Republicans are open to the more serious charge that they are ignoring the more optimistic and inclusive vision of our country articulated by former President Ronald Reagan.

Demonstrating the Cheap-shot Defense

When I first started arguing that now is the time to press the case for eliminating the U.S. Department of Education, I noted that the biggest obstacle to scaling down fed ed has long been the cheap-shot smearing of would-be downsizers. Today, I want to thank Kevin Carey, Policy Director at the think tank Education Sector, for brilliantly illustrating that very unsightly strategy.

Writing on Education Sector’s blog yesterday, Carey ripped into a post I put up that morning, a post that primarily linked to a call to abolish ED from a left-leaning educator. Carey’s rejoinder: Basically, Cato hates public education, and there’s a whole lotta crazy goin’ on:

The Cato Institute is dedicated to creating “a future where government-run schools give way to a dynamic, independent system of schools competing to meet the needs of American children,” i.e. destroying public education as we know it.  As such, Cato wants to abolish the U.S. Department of Education. This fringe notion was first advanced by Ronald Reagan, until A Nation at Risk was published and the Great Communicator abruptly made an about-face and became very interested in an expanded federal role in K-12 policy as way to appeal to moderate voters in the 1984 election. The idea come up again a decade later during the brief rise of Gingrichism before fading into deserved obscurity for the next 15 years.

Then Tea Party candidates like Sharron Angle revived the kill Education platform, based on a general antipathy toward the federal government combined with not knowing anything about education….

So now reporters are calling me all the time asking me whether to take this stuff seriously. The answer is: No. Do not take it seriously. Nobody is shutting down the U.S. Department of Education. If one thing is sure in this life, one certainty that can be clung to like a rock in a storm, it’s that Congressional Republicans don’t actually want to shrink the size of the federal government, reduce the deficit, or cut federal programs in any meaningful way, particularly programs that enjoy broad public support as education programs do.

That plain fact, however, hasn’t prevented Cato’s education analysts from excitedly suggesting that the Department of Education abolition movement is on the rise. Few have joined their cause, because few people want to destroy public education as we know it. However, today Cato’s Neal McCluskey identified an ally in the reactionary anti-reform left….

[Long quote from my post]

There you have it: if you were wondering who besides the Cato Institute, an organization dedicated to applying principles of extreme privatization to all walks of public life, is out there enough to abolish the Department of Education — well, now you know.

That said, beyond the “There will always be strange bedfellows in Crazy Town” aspect of this, it does raise the interesting question of whether the NEA and other hardcore anti-accountability / anti-charter / anti-testing / anti-merit pay / anti-TBD people would be willing to join forces with Congressional Republicans to visit some kind of serious harm on the federal education framework of standards, testing, and accountability.

Where to begin…

Let’s start with what’s not in Carey’s big bag o’ belittling: substance. At the root of my argument for eliminating ED is the reality that federal intervention in education has produced little by way of educational improvement while costing significant amounts of money. It is also of highly questionable constitutional validity. So my argument isn’t driven by blind ideology, or just plain wackiness, but serious policy concerns, foremost of which is that ED isn’t actually good for education – which is our main concern, right? – or the country. But those concerns are nowhere mentioned in Carey’s post, and he implies that if you share my opinion, as Sharron Angle does, you probably know nothing about education.

Carey’s dismissal of George Wood, whose blog post is the heart of the entry I wrote that sent Carey over the edge, is similar. Wood makes very logical arguments for why ED is a net loss and should be absorbed into a department like Health and Human Services. I don’t agree with all of his reasoning, but it clearly shows logical thinking about why ED should go. Carey’s response: Forget your arguments, you belong in “Crazy Town” with McCluskey.

How about the stuff that is in Carey’s post?

First, there’s the usual attack that Cato-types are nutty fringers who want to destroy “public education.” As I have (obviously ineffectually) tried to explain to Carey before, I am not against public education, in which government ensures that everyone can access education. I am against public schooling, in which government runs the schools. This gets directly to the bedrock question of how best to operate education in a free society, as well as make schooling work primarily for parents and kids. And contrary to the connotation of phrases like “destroying public education as we know it,” government run schooling with a huge federal presence has hardly been the standard for most of American history.

Here’s another bit of history Carey misrepresents. He suggests that Ronald Reagan’s efforts to abolish ED in the early 1980s were part of a “fringe notion” that there shouldn’t be an ED. That’s a little hard to take, considering that ED was created by legislation signed in 1979, and didn’t start functioning until 1980. Oh, and the final House vote on the Department? It won by a scant 4 votes, 210 to 206. And heck, even American Federation of Teachers President Albert Shanker opposed the new Department. So yeah, very fringy.

Where Carey does make sense is in his argument that for political reasons it is not very likely that the Department of Education will be abolished.  “If one thing is sure in this life,” he writes, “it’s that Congressional Republicans don’t actually want to shrink the size of the federal government, reduce the deficit, or cut federal programs in any meaningful way, particularly programs that enjoy broad public support as education programs do.”

Carey is far too certain about what’s in Congressional Republicans’ hearts – I bet many really do want to shrink government and reduce the deficit – but based on recent history it’s certainly reasonable to be dubious that as a group they’ll do those things. But I have never said anything different – indeed, I fully acknowledged the political obstacles:

Yesterday, Tad DeHaven wrote about an interview with Rep. John Kline (R-MN), likely chairman of the House Education and Labor Committee should the GOP take the House majority. Tad lamented that Kline seemed to declare any potential effort to kill the U.S. Department of Education (ED) already dead in the water. Unfortunately, Kline is certainly right: Any effort to kill ED in the next couple of years would not only have to get through a (presumably) GOP-held House, but (also presumably) a Dem-controlled Senate and Obama-occupied White House. There just aint no way ED will be dismantled — and more importantly, it’s profligate programs eliminated — in that environment.

That said, if many Tea Party-type candidates win today, it will be precisely the time to start pushing the immensely powerful case for ending fed ed.

I have been very clear in stating that now is the time to start pushing in earnest to end ED, not that success is almost here. But that just doesn’t fit in the “Crazy Town” narrative, I guess.

Anyway, thanks to Kevin Carey for furnishing a terrific example of this most crucial of points: The federal education war is rarely fought with reason and evidence. No, cheap shots and demonization, sadly, are the weapons of choice.

Liberal Dogma on Social Security Redux

Liberal posturing on Social Security reform continues unabated – betraying nervousness that Obama’s Deficit Reduction Commission will recommend Social Security benefit cuts. 

Left-wing voices also continue to repeat the mantra that introducing private Social Security accounts would be a bad idea. Ronald Brownstein’s recent recent column in the National Journal is a case in point. However, Brownstein’s readers may come away thinking that he believes breaking promises is a good idea.

Brownstein concedes that “Social Security indeed faces a long-term imbalance between expected revenue and promised benefits.” I consider this to be progress — at least relative to the erstwhile “there’s nothing wrong and nothing to fix” mantra adopted by liberal adherents of the status quo on Social Security.

Notice Brownstein’s use of the term “promised benefits.”  A promise implies a commitment and obligation to make good on future benefit payments.  But the solution that Mr. Brownstein points to is as follows:

Instead [of private accounts], Obama argued, the two parties could emulate the Reagan model and arrive at a sensible solution… [T]he program’s long-term shortfall could be eliminated just by trimming benefits for the top half of earners [JG note: breaking the Social Security benefit promise here], linking the retirement age to lengthening life spans [JG note: breaking the promise here too], and imposing a partial payroll tax on earnings above $250,000 [JG note: that is, promise more benefits by expanding the definition of covered earnings and increasing payroll taxes on high earners].”

But all that the last element may achieve is to stave of the program’s insolvency for a few more years. 

My comment:  Please don’t drag Reagan into this “solution.”  The 1983 reforms were implemented under the gun, at a time when there was no way out of Social Security’s imminent revenue shortfall. If President Reagan had enjoyed the luxury of a couple more years to plan changes to Social Security, he would have adopted a different approach, and be much better off today. According to broad market indexes such as the S&P 500, total returns averaged well above 10 percent per year during the 1980s and 90s – so, well above inflation. (The first decade of the 2000s yielded a negative 1 percent return.)

Finally, Brownstein writes:

[T]he gap between the system’s revenues and obligations, relatively speaking, isn’t that daunting–less than 1 percent of the economy’s expected output over the next 75 years. 

Does Mr. Brownstein really appreciate how large that is? In present value terms, the Social Security actuaries report that the present value of Social Security’s shortfall over the next 75-years equals $5.4 trillion. That’s one-third of current annual GDP. In other words we have to devote that sum to earning interest each year for 75 years to cover Social Security’s financial gap.

Alternatively, since payrolls equal only one-half of national output, it means that payroll taxes would have to increase by an average of about 2.0 percent per year if they are levied over all wage earners.  However, the tax increase is to be levied only on those earning $250,000 or more.  There are about 3 million U.S. taxpayers with incomes above $250,000, with average income of about $500,000. (I’m rounding up based on information for 2006 available here.)  That makes a tax base of $1.5 trillion. (Actually, this is likely to be too large because I’m counting total income, not taxable income, which would be much smaller.) Raising the equivalent amount of revenues from these high earners (who face the highest marginal income tax rates already and are likely to alter their work effort in response to still higher taxes) would imply increasing their average tax rates by almost 11 percentage points. Of course, because some of the adjustment will be through benefit cuts and indexing the retirement age to increasing longevity, the tax increases that must be levied on high earners would be smaller. 

But are those benefit cuts politically realistic? Americans already face a normal retirement age of 66, and it is scheduled to increase to 67 in little more than a decade. Extrapolating from the French response to increasing their pensionable age from just 60 to 62, Americans’ would probably end up opening a third war front to resist further increases in Social Security’s retirement ages – a “generational war” here at home.

So where do we go from here?  One answer may be to first introduce “add-on” personal accounts using the 2.0 percentage points of payrolls – the amount required to plug Social Security’s current shortfall. This would not be a “tax” as the funds would be invested in personal accounts – and it would enable low earners an opportunity to partake in the long-term wealth creation mechanism that they have heretofore been unable to exploit.  As I have argued here, if this amount is effectively saved and invested – by insuring that the government does not borrow and spend those savings – it would create space for a “carve-out” addition to the “add on” personal accounts, increasing retirement wealth even more.  Finally, with the stock markets relatively stable and current P/E ratios of broad market indexes close to historical averages, now would be the right time to begin such a reform program for Social Security. 

Would liberal policymakers and analysts take on this approach?  No prizes for guessing the answer.

What Was That Ronald Reagan Line Again?

The Washington Post editorializes this morning on the “Google-Verizon” proposal for government regulation of the Internet:

For more than a decade, “net neutrality” — a commitment not to discriminate in the transmission of Internet content — has been a rule tacitly understood by Internet users and providers alike.

But in April, a court ruled that the Federal Communications Commission has no regulatory authority over Internet service providers. For many, this put the status quo in jeopardy. Without the threat of enforcement, might service providers start shaping the flow of traffic in ways that threaten the online meritocracy, in which new and established Web sites are equally accessible and sites rise or fall on the basis of their ability to attract viewers?

What a Washington-centric view of the world, to think that net neutrality has been maintained all this time by the fear of an FCC clubbing. Deviations from net neutrality haven’t happened because neutrality is the best, most durable engineering principle for the Internet, and because neutral is the way consumers want their Internet service.

Should it be cast in stone by regulation, locking in the pro-Google-and-Verizon status quo? No. The way the Internet works should continue to evolve, experiments with non-neutrality failing one after another … until perhaps one comes along that serves consumers better! The FCC would be nothing but a drag on innovation and a bulwark protecting Google and Verizon’s currently happy competitive circumstances.

I’ll give the Post one thing: It represents Washington, D.C. eminently well. The Internet should be regulated because it’s not regulated.

“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

The Public Isn’t Buying

Today POLITICO Arena asks:

Angry Left Obama’s bête noir?

My response:

Would the president help himself by making a clearer ideological declaration – as many on the “professional left” are asking him to do? Hardly. POLITICO tells us this morning that those “professionals” lament “the president’s reluctance to be a Democratic version of Ronald Reagan, who spoke without apology about his vaulting ideological ambitions.” One of those professionals, Robert Reich, urges Obama to present “a clear and convincing narrative into which all the various initiatives neatly fit, so that the public can make sense of everything that’s done.”

The public is quite capable of making sense of everything that’s been done. It’s doing it, and it doesn’t like what it sees. Reagan spoke boldly about his vision because it arose directly from fundamental American principles – individual liberty, free markets, and limited constitutional government. Obama avoids presenting “a clear and convincing narrative” because if he stated his vision more clearly it would be even less convincing than it already is.

Thus, White House press secretary Robert Gibbs was right to complain about the criticism’s coming from members of the professional left, who spend their lives cloistered in academia, the mainstream media, and other such redoubts, talking to each other. But Gibbs’s problem is deeper: It’s the product, not the pitch.