Topic: General

Margaret Thatcher and Eastern Europe

By
Dalibor Rohac

A week ago, my colleague Marian Tupy wrote movingly about his personal encounter with Lady Thatcher. Although I never had a chance to speak with her at any length, I echo his sentiments in my recent piece for the Spectator (U.K.), where I argue that both the substance of her policies and the symbolic value of her actions - such as her visit to Gdańsk in November 1988 - played an important role in post-communist transitions:

Symbols matter. In Czechoslovakia, the communist party newspaper, Rudé právo (‘The Red Law’) chose to ignore the Gdańsk episode, providing instead a short notice about her talks with the Polish government about ‘the need to energise economic cooperation between the two countries’. But there was no coming back. In Poland it took less than two months since Thatcher’s visit for the Polish regime to recognise that it was fighting a losing war and start talks with Solidarity, which would lead to dismantling of communism in the country. Czechs and Slovaks had to wait for another year.

The concluding paragraph:

In short, her success in fixing the British economy gave Eastern Europe an example to aspire to. Thanks to her example, Eastern Europeans of the early 1990s understood well that bold and sometimes painful reforms were a necessary condition for Western levels of prosperity. Somehow, I doubt that the current generation of Western leaders are inspiring the same sentiments in citizens of emerging democracies of the world.

Topics: 
General, Government and Politics

Americans Deserve to See Federal Role in National Tests

By
Neal McCluskey

The drive to impose uniform curriculum standards on the nation’s schools has been one of stealth, and at times, seemingly intentional deception. Most egregious has been the mantra of Common Core proponents that the effort has been “state-led and voluntary,” despite Washington coercing state adoption through the Race to the Top program and No Child Left Behind waivers; standards creators encouraging just such federal “incentives”; and Washington selecting and funding the two groups creating the tests to go with the standards. And now, more than a week after the U.S. Department of Education announced the creation of a “technical review” panel to assess the assessments, it seems increasingly certain that the panel’s work will be done behind closed doors.

At least one report asserts that the meetings will, indeed, be closed to the public. Education Week’s initial reporton the review says that the panel’s “feedback” will eventually be made public in “a yet-to-be-determined form,” but says nothing about the meetings themselves. Cato Center for Educational Freedom efforts to confirm the meeting status with the U.S. Department of Education have come up empty, with calls over two days either resulting in no information or simply going unanswered. At best, then, the meetings will be open to the public but ED has a terrible communications system. At worst the panel’s work will be completely under wraps save for some kind of final – and perhaps heavily filtered – report.

Either scenario is unacceptable. These tests are being funded by taxpayers, and the goal is ultimately to use them to assess the math and reading mastery of the nation’s children. Funders and families deserve to see what this review panel is doing, and shouldn’t have to pull telecommunications teeth to find out if and how they can do that. In addition, Common Core supporters have taken to painting opponents as paranoid, while at the same time denying or downplaying the federal government’s major role in pushing the Common Core. It would not be surprising were they to use the same tactics should Common Core opponents raise questions about the degree to which the Feds are influencing what is on the tests. The panel may well leave test content alone, but given the track record so far it is rational to fear the worst, especially when it seems the review panel is purposely being kept out of real sunlight.

Americans deserve to see all that the Feds are doing with this supposedly non-federal effort.

Topics: 
Education and Child Policy, General, Government and Politics, Telecom, Internet & Information Policy

Social Conservatism, the GOP’s Key To Unlocking Black Votes? Don’t Believe It.

By
Walter Olson

Among politically active social conservatives, there’s a remarkably durable myth that Republicans can make inroads with black voters if only they hold fast to hard-line positions on issues like same-sex marriage. That notion cropped up again this week as part of a widely publicized letter to Republican National Committee chair Reince Priebus in which thirteen officials with social-conservative groups threatened that their followers will leave the GOP or stay home in future elections unless the party pledges to continue its staunch line against gay marriage, a stance now widely unpopular in public opinion polls and among many Republican demographics such as those under 50. 

The letter, which you can read here, portrays the issue as vital in GOP minority outreach, which they said should “focus on issues where there is mutual agreement like traditional marriage.”  (It does not mention that black opinion, once lopsidedly opposed to same-sex marriage, has swung closer in polls to an even split on the issue). To support this claim, it cites real-world examples from three states: Illinois, Ohio, and my own state of Maryland. 

On Ohio, the letter repeats longstanding claims that President George W. Bush’s campaign stance on marriage made the difference in his narrow Buckeye State win in 2004. My colleague David Boaz has already examined those claims in this space, and found the evidence surprisingly thin. The Illinois example, for its part, is self-evidently beside the point: the letter correctly notes that some minority elected officials in that state oppose same-sex marriage, but that does nothing to show that any Illinois blacks are ready to stop voting Democratic because of their concern for the issue.  

That leaves Maryland. And in the course of analyzing last November’s Maryland vote in some detail, and writing a series of articles on the results of my research, I feel some confidence in saying that no one has been able to offer evidence that the ballot fight over same-sex marriage did the Maryland Republican Party any overall good with black voters in the state.

As I noted in this December article in The Blaze, Prince George’s County in suburban Washington, which has a substantial black majority among registered voters and has won national attention as a microcosm of black political trends, was hard fought territory in Maryland’s Question 6 fight. In the end, the county split about evenly, Question 6 trailing by just 1 point; the measure was carried to a 5-point statewide win by a strong showing elsewhere in the Baltimore-DC corridor, notably including many Republican suburbs.  

Because P.G. is so large and has so many overwhelmingly black precincts, it afforded an opportunity to investigate whether black voters with socially conservative views are any more likely to vote Republican than those with more socially liberal inclinations. Toward that end, I identified those black-dominated precincts with the strongest social-conservative leanings, as measured by the size of the margins by which they disapproved Question 6. If the “GOP minority inroads” thesis was correctly identifying a genuine trend, you would expect to see signs of a healthy black crossover vote for GOP candidates in those precincts. Instead, the black precincts that most strongly opposed Question 6 were also among those where the GOP got buried most completely, with Mitt Romney getting only (in typical showings) 3, 5, or 6 percent of the overall vote. The down-ticket Maryland GOP candidates, who all happened to be strong social conservatives, were getting beaten just as decisively, including in Senate and House races where all the relevant candidates were white. The GOP’s social-conservative senate hopeful, for example – who ran well enough to carry 13 of 23 counties statewide against lackluster white liberal Sen. Ben Cardin – did even worse in P.G. than Romney, winning only 6 1/2 percent of the vote county-wide and a good bit less than that – as little as 2 percent in one precinct – in the most socially conservative black P.G. neighborhoods.  

Republicans who imagine that catering to the most vehement social conservatives within the party will result in a harvest of new black votes are deluding themselves. 

 

Topics: 
General, Law and Civil Liberties

Yay Authoritarianism!

By
Michael F. Cannon

Cato-at-Liberty readers who are enjoying—or, at least, chronicling—our nation’s slide down The Road to Serfdom will have to add Neil Irwin’s Washington Post Outlook piece, “Why the financial crisis was bad for democracy,” to their travelogue:

In a democratic society, there will always be tension over which decisions should be made by expert appointees, and which by those with the legitimacy and accountability that come with competing for citizens’ votes. The technocrats can make complex decisions quickly, quietly and efficiently. The words “quick, “quiet” and “efficient” are rarely applied to the U.S. Senate or the Italian Parliament — but these institutions are imbued with an authority that comes directly from the people, the explicit consent of the governed.

So, in a crisis, which do you want: unaccountable decisiveness or inefficient accountability?

Consciously or not, we’ve made our choice: The financial crisis and its long, ugly aftermath have marked the triumph of the technocrats…

None of this is a great way to run a society. Like most journalists, I believe in transparency and accountability. I wish the Federal Reserve’s policy meetings were broadcast on C-SPAN. Instead, we get written transcripts five years later. (That still beats Europe, where such information is under lock and key for 30 years.)

Yet, when the world is on the brink, decisive problem-solving trumps the niceties of democratic process. I won’t like it much — but I’ll take it.

Authoritarianism cannot take hold without intellectual support, and Friedrich Hayek couldn’t have described the rationale better himself. Just equally well. Almost verbatim, actually.

For more, see my paper (with Diane Cohen) on IPAB and this Cato policy forum on IPAB and Dodd-Frank. And of course, read Hayek’s The Road to Serfdom while it’s still legal.

Topics: 
Finance, Banking & Monetary Policy, General, Government and Politics, Health Care, Law and Civil Liberties, Political Philosophy

Margaret Thatcher and the Battle of the 364 Keynesians

By
Steve H. Hanke

With the death of Margaret Thatcher, and the ensuing profusion of commentary on her legacy, it is worth looking back at an overlooked chapter in the Thatcher story. I am referring to her 1981 showdown with the Keynesian establishment—a showdown that the Iron Lady won handily. Before getting caught up with the phony “austerity vs. fiscal stimulus” debate, the chattering classes should take note of how Mrs. Thatcher debunked the Keynesian “fiscal factoid.”

According to the Oxford English Dictionary, a factoid is “an item of unreliable information that is reported and repeated so often that it becomes accepted as fact.” The standard Keynesian fiscal policy prescription for the maintenance of non-inflationary full employment is a fiscal factoid. The chattering classes can repeat this factoid on cue: to stimulate the economy, expand the government’s deficit (or shrink its surplus); and to rein in an overheated economy, shrink the government’s deficit (or expand its surplus).

Even the economic oracles embrace the fiscal factoid. That, of course, is one reason that the Keynesians’ fiscal mantra has become a factoid. No less than Nobelist Paul Krugman repeats it ad nauseam. Now, the new secretary of the treasury, Jack Lew (who claims no economic expertise), is in Europe peddling the fiscal factoid.

Unfortunately, the grim reaper finally caught up with Margaret Thatcher—but not before she laid waste to 364 wrong-headed British Keynesians.

In 1981, Prime Minister Thatcher made a dash for confidence and growth via a fiscal squeeze. To restart the economy, Mrs. Thatcher instituted a fierce attack on the British fiscal deficit, coupled with an expansionary monetary policy. Her moves were immediately condemned by 364 distinguished economists. In a letter to The Times, they wrote a knee-jerk Keynesian response: “Present policies will deepen the depression, erode the industrial base of our economy and threaten its social and political stability.”

Mrs. Thatcher was quickly vindicated. No sooner had the 364 affixed their signatures to that letter than the economy boomed. Confidence in the British economy was restored, and Mrs. Thatcher was able to introduce a long series of deep, free-market reforms.

As for the 364 economists (who included seventy-six present or past professors, a majority of the Chief Economic Advisors to the Government in the post-WWII period, and the president, as well as nine present or past vice-presidents, and the secretary general of the Royal Economic Society), they were not only wrong, but also came to look ridiculous.

In the United States, the peddlers of the fiscal factoid have never suffered the intellectual humiliation of their British counterparts. In consequence, American Keynesians can continue to peddle snake oil with reckless abandon and continue to influence policy in Washington, D.C., and elsewhere.

Topics: 
Cato Publications, Finance, Banking & Monetary Policy, General, Government and Politics, International Economics and Development, Tax and Budget Policy

Ohio, Missouri Introduce the Health Care Freedom Act 2.0

By
Michael F. Cannon

Ohio Reps. Ron Young (R-Leroy Twp.) and Andy Thompson (R-Marietta), and Missouri Sen. John Lamping (R-St. Louis County), have introduced legislation—we call it the Health Care Freedom Act 2.0—that would suspend the licenses of insurance carriers who accept federal subsidies through one of the Patient Protection and Affordable Care Act’s (PPACA) health insurance Exchanges. At first glance, that might seem to conflict with or otherwise be preempted by the PPACA. Neither is the case. Instead, the HCFA 2.0 would require the IRS to implement the PPACA as Congress intended.

Here’s why. Under the PPACA, if an employer doesn’t purchase a government-prescribed level of health benefits, some of its workers may become eligible to purchase subsidized coverage through a health insurance “exchange.” When the IRS issues the subsidy to an insurance company on behalf of one of those workers, that payment triggers penalties against the employer. Firms with 100 employees could face penalties as high as $140,000.

Congress authorized those subsides, and therefore those penalties, only in states that establish a health insurance Exchange. If a state defers that task to the federal government, as 33 states including Missouri and Ohio have done, the PPACA clearly provides that there can be no subsidies and therefore no penalties against employers. The IRS has nevertheless announced it will implement those subsidies and penalties in the 33 states that have refused to establish Exchanges. Applying those measures in non-establishing states violates the clear language of the PPACA and congressional intent. See Jonathan H. Adler and Michael F. Cannon, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA,” Health Matrix: Journal of Law-Medicine 23 (2013): 119-195.

Whether legal or illegal, those penalties also violate the freedoms protected by the Health Care Freedom Amendment to Ohio’s Constitution, and Missouri’s original Health Care Freedom Act, which voters in each state ratified by overwhelming majorities. The Ohio (HB 91) and Missouri (SB 473) bills would protect employers and workers from those penalties, and thereby uphold the freedoms enshrined in Missouri statute and Ohio’s Constitution, by suspending the licenses of insurance carriers that accept those subsidies.

The question arises whether the PPACA would preempt such a law. It does not. The HCFA 2.0 neither conflicts with federal law, nor attempts to nullify federal law, nor is preempted by federal law.

The HCFA 2.0 concerns a field of law—insurance licensure—that has traditionally been a province of the states under their police powers. In preemption cases, courts “start with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.” Wyeth v. Levine, 129 S. Ct. 1187, 1194-95 (2009). Courts then must determine whether the state law in question is nevertheless trumped by express or implied federal preemption.

Read the rest of this post »

Topics: 
General, Government and Politics, Health Care, Law and Civil Liberties

Thatcher: Anecdotes From a Biographer

By
Walter Olson

Her greatness as a political leader aside, and her penetrating moral critique of socialism and communism (so closely intertwined with that greatness) also aside, Margaret Thatcher was almost infinitely quotable.  On the economic folly she fought so tenaciously: “The problem with socialism is that you eventually run out of other people’s money.”  On popularity: “If you just set out to be liked, you would be prepared to compromise on anything at any time, and you would achieve nothing.” On productiveness and the charitable instinct: “No one would remember the Good Samaritan if he’d only had good intentions; he had money as well.” On the hostile press: “If my critics saw me walking over the Thames they would say it was because I couldn’t swim.” And many others, some of the best collected at the U.K. Spectator. 

If you have time to read only one longer Thatcher article today, you could do worse than this terrific, anecdote-filled 2011 Vanity Fair piece by her biographer Charles Moore. Like so many others, Moore is fascinated by Thatcher’s force of personality, which so often drew adjectives like “steely” and “indomitable.” Thatcher, like Ronald Reagan, was entirely willing to reinvent herself on a personal level more than once, in the “self-made” manner that is often seen as particularly American. Thus as she approached the world stage, she studied how to dress and speak the part, taking lessons (at the suggestion of Sir Laurence Olivier) from the speech coach at the National Theater. 

Pro-intellectual, Thatcher was one of the first to spot the potential of think tanks: 

Her greatest political mentor, Sir Keith Joseph, was almost perfect in her eyes, being intellectual, good-looking, Jewish, and upper-class [four categories she approved of]. … He diagnosed — and blamed himself for — a British postwar disease of socialism, state intervention, debauched currency, weakened incentives, and overly powerful trade unions. The Tories, he declared, had been complicit in all of this… They must devise a new strategy, he said, and he set up a think tank, called the Centre for Policy Studies, to do so. Margaret Thatcher became its vice chairman and his disciple.

Thatcher made many mistakes, but often learned from them and eventually revised her views, as when she concluded that she had been too enthusiastic about the project of European integration: “We have not successfully rolled back the frontiers of the state in Britain only to see them re-imposed at a European level, with a European super-state exercising a new dominance from Brussels.”

“I am extraordinarily patient, provided I get my own way in the end,” Thatcher memorably remarked. And mostly she did, to the benefit of Britain and the world.

Topics: 
General, Government and Politics

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