Tag: Texas

Washington Post: Adding Insult to Obamacare’s Injury

On Sunday, The Washington Post published my letter to the editor:

The excellent July 24 front-page article “Health law’s unintended impact on part-timers” showed how President Obama’s health-care law is cutting part-time workers’ pay by forcing employers to limit these employees’ hours in order to avoid penalties. Yet the reality is even worse.

Obamacare does not authorize those penalties in states that leave the task of establishing a health insurance exchange to the federal government. That means most of the employers the article cited — the commonwealth of Virginia, various Texas employers, the Ohio-based White Castle burger chain, the city of Dearborn, Mich., and Utah’s Granite School District — don’t need to cut part-timers’ hours, because the federal government has no authority to penalize them.

Yet the Obama administration has decreed it will do so anyway, contrary to the clear language of federal law, proving that taxation without representation is not confined to the District.

Two lawsuits have been filed to stop this illegal action — one by the state of Oklahoma, another by employers and individual taxpayers in Kansas, Missouri, Tennessee, Texas, Virginia and West Virginia.

Even so, thousands of part-time workers are already losing wages because of a tax Congress did not authorize. As underemployed music professor Kevin Pace told The Post, “This isn’t right on any level.”

Michael F. Cannon, Washington

The writer is director of health policy studies at the Cato Institute.

On Wednesday, July 31, a House oversight subcommittee will be holding a hearing on the IRS’s illegal taxes, borrowing, and spending.

Immigration Does Not Decrease Economic Freedom

A common criticism of immigration reform (here, here, and here) is that it will decrease economic freedom in the United States, by increasing the voting pool for the Democratic Party.  Leaving aside the issue of which party supports economic liberty, if any, it’s important to see what the actual impacts of immigration are on economic freedom in the United States and the world.  The political effects of immigrants after they arrive are less certain than the economic benefits.  Do immigrants decrease economic freedom in their new countries?  The bottom line: fears of immigrants decreasing economic freedom seem unfounded.

Since 1980, wealthy countries have seen rises in immigrant populations.  Immigrants are drawn to economic prosperity, higher wages, and better standards of living so it’s not surprising that wealthier countries have higher percentages of immigrants.  I excluded numerous small countries and petro-states like the UAE and Kuwait from the analysis.

I looked at the 25 wealthiest nations in the world in 1980 (by per capita GDP PPP) and considered their economic freedom rating and the percent foreign born.  I then tracked those same countries every 5 years until 2010.  Here are the averages for all 25 nations:

Voting in 2012, Libertarian and Otherwise

Somehow, election results continue to trickle in, and David Wasserman of the Cook Political Report continues to update his spreadsheet of the national popular vote. At this point, he shows President Obama reelected with 50.86 percent of the vote to Mitt Romney’s 47.43 percent. For whatever reason, the late-arriving results all seem to widen Obama’s lead.

The total vote appears to be down by almost 4 million votes from 2008, and Obama has received about 4.7 million fewer votes than he did in his first campaign. Romney received slightly more votes than John McCain did.

Libertarian Party nominee Gary Johnson received 1,265,000 votes, according to Wikipedia, whose mysterious editors show the votes for every candidate. That’s the most any Libertarian presidential candidate has ever received. It amounts to 0.99 percent, just shy of Ed Clark’s 1.06 percent in 1980. If Johnson had been on the ballot in Michigan and Oklahoma, he would surely have broken 1 percent, though he still probably wouldn’t have exceeded Clark’s percentage. (Michigan and Oklahoma haven’t been very good states for Libertarian candidates.) Johnson’s best states were New Mexico, where he served two terms as governor, followed by Montana and Alaska.

The Libertarian Party reports that seven Libertarian statewide candidates in Texas and Georgia received more than a million votes.

Don’t forget to read the new ebook The Libertarian Vote: Swing Voters, Tea Parties, and the Fiscally Conservative, Socially Liberal Center, which discusses how the millions of libertarian-leaning voters in America tend to vote. (It does not have 2012 results.)

Trade Problems May Not Always Call for Trade Answers

The federal system of government in the United States has the invaluable consequence of enabling policy experimentation.  If a state legislature is considering adopting a particular policy, it can often look at the experiences of other states that have tried that policy before.  A recent study from the Milken Institute in California tries to take advantage of such potential comparisons to offer ways that California could increase its dwindling share of U.S. exports.  It is a valiant effort, but California’s decline is not the consequence of inadequate trade policy and no amount of export promotion is going to fix it.

The study begins by comparing California’s decline in export share to the dramatic rise in cross-border trade originating from Texas, the nation’s leader in goods exports. After using Texas’s success as an example of how California is lagging behind, the study decides not to use Texas as a model for reform and instead focuses on other states that have used export promotion (subsidy) agencies as case studies for how California can improve its bureaucracy to reverse the current trend.

If the success of Texas is what California should seek, then why not look at Texas as a model for reform? The study says that Texas is “unique” because it 1) has no export promotion agency, 2) has a low cost of doing business, and 3) has benefited from increased trade with the growing economy of Mexico by virtue of NAFTA-enabled integration. These differences seem to point to clear policy choices: don’t worry about export promotion (easy), improve your state’s business environment, and be close to Mexico (done!).

If it becomes more business-friendly, your state will have more business, export-oriented business included.  Since we’re looking at Texas as a model, may I suggest improving the business environment by lowering taxes and reducing regulation.

Now, I realize that the Overton Window for politically feasible reform proposals in California may not include lowering the cost of doing business. It makes a lot of sense for the authors of the study to point out the root causes of different outcomes in Texas and California but still seek a different solution more palatable to Californian sensibilities. I think their specific proposals for enhancing the capacity and quality of the export promotion process are insightful and well-supported.

There is a larger lesson in all of this for national economic policy. Increasing exports through the National Export Initiative has been a major goal of the Obama Administration’s economic recovery plan, and subsidizing loans through the Export-Import Bank has been a primary tool in that endeavor. But the people of the United States don’t need more bureaucracy to engage in more trade. They need policies that remove artificial barriers and decrease the cost of doing business—international and otherwise.

Rick Perry, Arne Duncan, and Michael Jackson

To my astonishment, Arne Duncan went after Republican presidential candidate Rick Perry yesterday on the grounds that Perry hasn’t done enough to improve the schools under his jurisdiction. According to Bloomberg News, Duncan said public schools have “really struggled” under Perry and that “Far too few of [the state’s] high school graduates are actually prepared to go on to college.”

I was never a huge Michael Jackson fan, but for some reason his “Man in the Mirror” track just popped into my head as I read this. You see, once upon a time, Arne Duncan was “CEO” of the Chicago Public Schools. During and for some time after his tenure, he was celebrated as having presided over “The Chicago Miracle,” in which local students’ test results had improved dramatically. That fact turns out to have been fake, but accurate. The state test results did improve, but not because students had learned more; they appear to have improved because the tests were dumbed-down.

When this charge was first leveled, I decided to look into it myself, and found that it was indeed justified. There was no “Chicago Miracle.” Arne Duncan ascended to the throne of U.S. secretary of education, at least in part, on a myth. The academic achievement of the children under his care stagnated at or slightly below the level of students in other large central cities during his time at the helm. Seems an opportune occasion for someone to “start with the man in the mirror, asking him to change his ways.”

Texas Court Rules For Eminent-Domain Critic

Good news from Texas, where a state appeals court has handed a major win to investigative journalist Carla Main, whose book Bulldozed: ‘Kelo,’ Eminent Domain, and the American Lust for Land took a critical look at the seizure of private land under eminent domain laws for purposes of urban redevelopment. Dallas developer H. Walker Royall didn’t like what Main wrote about his involvement in a Freeport, Texas marina project and proceeded to sue her, publisher Encounter Books (which I should note is also my own publisher on Schools for Misrule), and even liberty-minded law professor Richard Epstein over a dust jacket blurb Epstein had given for the book. (Earlier coverage of the suit here and here.)

A trial court had declined to dismiss Royall’s claims on summary judgment, but yesterday Judge Elizabeth Lang-Miers reversed in substantial part, ruling that Royall had failed to make the requisite showing that key passages in Bulldozed had in fact defamed him. The case is not yet over, but Institute for Justice senior attorney Dana Berliner, who argued for the defense, is understandably jubilant: “Walker Royall has failed in his attempt to use this frivolous defamation lawsuit as a weapon to silence his critics,” she said. Moreover, outrage at Royall’s suit contributed to Texas’s enactment this summer (joining 26 other states) of strong “anti-SLAPP” legislation aimed at curbing lawsuits intimidating speech. You can read the opinion here, and early coverage at Gideon Kanner’s blog, the Dallas Observer and D Magazine.

Trade Helps Explain Texas-Sized Job Growth

As its governor, Rick Perry, weighs a run for the White House, Texas has drawn attention for its healthy job growth. Since the recession ended in June 2009, Texas has accounted for half of the net new jobs added to the U.S. economy, according to the lead story in this morning’s USA Today. That’s quite a record for one lone state.

We’ll leave it to others for now to argue over how much credit Gov. Perry can claim. Some credit surely goes to high oil prices, fueling job growth in a sector important to the Texas economy. Another reason for its relatively strong job growth is a friendly business climate, including no state income tax and relatively light regulations. And for those who scapegoat trade for the nation’s persistently high unemployment rate, consider that Texas is the nation’s number one trading state. As the USA Today story notes:

Overseas shipments by Texas’ strong computer, electronics, petrochemical and other industries rose 21% last year, compared with 15% for the nation, according to the Dallas Federal Reserve Bank. The state also benefits from its proximity to Latin American countries that are big importers of U.S. goods … The surge creates jobs for Texas manufacturers and ports.

As I can attest from recent speaking engagements in San Antonio and Laredo, Texans have embraced their state’s position as the nation’s leading gateway for trade with NAFTA-partner Mexico and the rest of Latin America.

While politicians and union bosses from other states grumble about allegedly unfair trade, the latest trade and job numbers show that the people of Texas are making the most of the opportunities created by our more open economy.