Topic: Government and Politics

Someone Should Have Warned Them

Shortly after the Republicans lost control of Congress in 2006, I wrote in my book, Leviathan on the Right: How Big Government Conservatives Brought Down the Republican Revolution, that unless the Republican Party rejected Bush-style big-government conservatism and returned to its limited government roots “the 2006 elections are likely to be just a taste of things to come.”

Apparently, Republicans didn’t heed that message.  By almost every measure, government grew bigger, more expensive, and more intrusive under President Bush and the Republican Congress. John McCain may have rhetorically criticized government spending, notably earmarks, but consistently backed bigger and more activist government, whether backing the Wall Street bail-out or calling for a $300 billion bailout of delinquent mortgages. By most measures he supported only slightly less government spending than did Sen. Obama.

Exit polls show that Republican losses were heaviest among upscale suburban voters who tend to be economically conservative but socially moderate. These formally reliable Republican voters did not suddenly decide that they wanted a bigger, more expensive, and more intrusive government. But, faced with the big-government status quo or big-government “change,” they opted for change.

Republicans now have two more years in the wilderness to decide whether or not they actually stand for limited government and individual liberty.  One wonders, whether this time they will hear the message.

To the Future: Good Advice from Jeff Flake

In Monday’s Washington Post Rep. Jeff Flake offers Republicans some good advice for the climb back:

I suggest that we return to first principles. At the top of that list has to be a recommitment to limited government. After eight years of profligate spending and soaring deficits, voters can be forgiven for not knowing that limited government has long been the first article of faith for Republicans….

Second, we need to recommit to our belief in economic freedom. Adam Smith’s “The Wealth of Nations” may be on the discount rack this year, but the free market is still the most efficient means to allocate capital and human resources in an economy, and Americans know it. Now that we’ve inserted government deeply into the private sector by bailing out banks and businesses, the temptation will be for government to overstay its welcome and force the distribution of resources to serve political ends. Substituting political for economic incentives is not the recipe for economic recovery….

In some respects, raising a new standard was made easier by yesterday’s rout. The Republican Party is not bound by election-year promises made by its presidential nominee. More important, the party is finally untethered from the ill-fitting and unworkable big-government conservatism that defined the Bush administration.

Smaller Government Is More Popular Than Obama

Pollsters occasionally ask respondents questions along the lines of “Would you say you favor smaller government with fewer services, or larger government with many services?” As might be expected, the economic crisis and the repeated claim that the Bush administration has been tight-fisted and deregulatory have moved voters to the left on that question. But not as far as you might think. Ramesh Ponnuru recently summarized some of the latest evidence:

CBS pollsters have often asked, “Would you say you favor smaller government with fewer services, or larger government with many services?” On this question there seems to be a pro-government trend over the last dozen years — but we certainly don’t seem to be more pro-government than we were during the Reagan ’80s. In April 1976 the larger-government side had a four-point lead and in May 1988 a one-point lead. Polls from 1996 through Jan. 2001 showed an average lead of 20 points for the smaller-government side. By November 2003, however, the smaller-government side led by only 3 points, and in the latest poll (March-April) the sides are tied.

The same pattern shows up in the results of a similar Washington Post/ABC poll question. People swung to a smaller-government view in the 1990s and then swung back, but the results from June 2008 (50-45 percent for smaller government) are roughly the same as those from July 1988 (49-45).

But other indicators do not even find a clear pro-government trend for the last decade. Gallup, as well as ABC and the Washington Post, has asked for many years whether Americans think that government “is trying to do too many things that should be left to individuals and businesses” or “should do more to solve our country’s problems.” Almost always most people fall on the conservative side of that question: in September 1992 by an eight-point margin; in October 1998 by 12 points; in September 2002 by 7 points; and in September 2008 by 12 points.

As I’ve noted before,

I’ve always thought the “smaller government” question is incomplete. It offers respondents a benefit of larger government–”more services”–but it doesn’t mention that the cost of “larger government with more services” is higher taxes. The question ought to give both the cost and the benefit for each option. A few years ago a Rasmussen poll did ask the question that way. The results were that 64 percent of voters said that they prefer smaller government with fewer services and lower taxes, while only 22 percent would rather see a more active government with more services and higher taxes.

The Rasmussen Poll continues to ask that question, and indeed it has shown a shift to the big-government side in the wake of the economic crisis. In late September respondents supported smaller government by only 57 to 31 percent – or about 20 points more than Obama’s margin over McCain. The victorious Democrats should take note.

Worst News: The Loss of John Sununu

Plenty of big-government Republicans, starting with John McCain, lost their elections tonight, and libertarians won’t shed too many tears for them. But the voters of New Hampshire, which just might be the most libertarian state, dealt limited government a real blow by defeating John Sununu’s bid for reelection. Sununu is the youngest, probably the smartest, and surely the most libertarian member of the Senate. In 2002 he campaigned on Social Security private accounts. In office he has stood firmly for free markets and fiscal responsibility. He also voted twice against the Federal Marriage Amendment and helped to reform the Patriot Act.

P. J. O’Rourke, Cato’s Mencken Research Fellow who lives in New Hampshire, wrote in the Weekly Standard in June:

Senator Sununu could write his political philosophy on a small piece of paper: “I have a deep-seated belief that America is unique, strong, great because of a commitment to personal freedom–in our economic system and our politics. We are a free people who consented to be governed. Not vice-versa.” (Italics added for the sake of the multitudes in our government’s executive, legislative, and judicial branches who need to fill out that index card and keep it with them at all times. And if the multitudes are confused by “Not vice-versa” they may substitute, We aren’t a government that consents to people being free.)

“It’s important for politicians to understand,” Senator Sununu said, “that the Founders’ writings reflect that point of view. From Jefferson to Hamilton, freedom was the special ingredient in human prospects, moral prospects, political prospects. The argument was over what government mechanism would ensure common good and guarantee freedom. There was no argument about whether we were free people. In most parts of the world there never has been an appreciation for that perspective. Governments have evolved to provide greater freedom, to reduce the power of monarchies, to reduce absolute power.”

New Hampshire may be the most libertarian state in the country; its license plates read “Live Free or Die,” and it demands that its politicians “take the pledge” not to raise taxes. But in 2006, after six years of overspending, war, the marriage amendment and other affronts to limited government, both the state’s Republican congressmen lost, and both houses of the state legislature went Democratic for the first time since 1874. John Sununu was a good senator in sync with the sentiments of New Hampshire, but he couldn’t swim against the riptide of George W. Bush and the Washington Republicans. He will be missed.

Not Just the First African-American President

For two years now, everyone has talked about Barack Obama becoming the first black president, barely 40 years after the civil rights revolution. Obama himself has often said, “I  don’t look like I came out of central casting when it comes to presidential candidates.”

But his achievement is even more striking than “first African-American president.” There are tens of millions of white Americans who are part of ethnic groups that have never produced a president. The fact is, all 42 of our presidents have been of British, Irish, or Germanic descent. We’ve never had a president of southern or eastern European ancestry. Despite the millions of Americans who came to the New World from France, Italy, Poland, Spain, Scandinavia, Russia, and other parts of Europe–not to mention Asia and the Arab world and Latin America–we’ve never had a president who traced his ancestry to those parts of the world. Indeed, it’s often been said that “we’ve never had a president whose name ended in a vowel” (except for a silent ”e” such as Coolidge, and with the exception of Kennedy), which is another way of saying “not of southern or eastern European heritage”).

As Philip Q. Yang put it in his book Ethnic Studies: Issues and Approaches, “There have been no presidents of southern and eastern European descent; and none of Jewish, African, Latino, Asian, or Indian descent.” We’ve had 37 presidents of British (English, Scottish, or Welsh) or Irish descent; three of Dutch descent (Van Buren and the two Roosevelts); and two of Swiss/German descent (Hoover and Eisenhower). Of course, these categories usually refer to the president’s paternal line; Reagan, for instance, was Irish on his father’s side but not on his mother’s. But that doesn’t change the overall picture.

In this light, Obama’s achievement is even more remarkable. He has achieved something that no American politician even of southern or eastern European heritage has managed. But I think we can assume that from now on there won’t be any perceived disadvantage to candidates of Italian, French, Asian, or other previous genealogies not previously seen in the White House. For that, congratulations to Barack Obama.

Lula’s Heart vs Brazil’s Interests

Brazil’s president, Luiz Lula da Silva, has informed everyone whom he favors in today’s election: “This (financial) crisis, among other benefits it will cause, will get Obama elected as president of the United States. It will get a black man elected, which is no small matter.”

This is quite ironic. During Lula’s tenure as president of Brazil he has heavily focused his relationship with the United States on commercial issues, particularly two: the elimination of a U.S. tariff on Brazilian ethanol and the reduction of U.S. farm subsidies for which Brazil has refused to negotiate a Free Trade Area of the Americas. On both issues, John McCain favors Brazil’s interests while Obama opposes them.

McCain has said he would eliminate the tariff on Brazilian ethanol (which is probably costing him Iowa). Obama would keep it. McCain also voted against the farm bill which extended the agricultural subsidies that Lula complains so much about in international fora. Obama voted in favor of it.

It seems that Lula’s left-leaning heart has lead him to favor a candidate that goes against his country’s own interests.

Obama’s Pandering to Seniors

“Many seniors are struggling to keep pace with costs,” Senator Obama told a largely senior audience in Florida on September 18. Social Security benefits are adjusted for rising prices but not for rising taxes, including increased fees for Medicare. Using a line from his tax plan, Obama said, “This strain has been greater since 1993, when taxes on social security benefits were raised. Millions of seniors saw their net benefits go down.”

Thanks to Bill Clinton’s 1993 tax law, single seniors with incomes above $40,048 in 2007 had to pay income tax on 85% of a portion of their benefits, and those with income above $46,850 had to pay tax on 85% of their entire benefits. That 1993 tax increase hits couples with incomes above $54,278.

In retirement communities in key states like Florida and Arizona, Obama has cleverly tapped into senior resentment about the Clinton era, when “millions of seniors saw their net benefits go down.” But then he pulls a bait and switch trick.

Clinton’s 1993 tax hike reduced after-tax benefits for seniors earning more than $50,000—because they continued working after age 65 and/or because they saved for retirement.

Obama proposes to fix that by eliminating income tax for seniors earning less than $50,000. He says, “When I’m President, we’ll work to see that no retiree making less than $50,000 each year has to pay income tax. This will eliminate income taxes for about 7 million Americans, at a savings rate of roughly $1,400 each year. And 22 million seniors won’t even have to file a return and hire an expensive tax preparer.”

If Sally is 60 years old earns $49,000 by working, she would pay a higher income (and payroll) tax than Sam who is 66 and makes $49,000 from retirement income. Is there any rational explanation for that other than a shameless attempt to buy senior votes?

To help pay for such arbitrary tax favoritism, Obama wants to increase the tax rates on capital gains and dividends—two taxes that hit frugal seniors much harder than young people.

As I wrote in my Hillsdale College paper, “The argument for Obama’s tax plans is expressed in terms of fairness, rather than the impact on incentives and economic performance, yet the implied concept of fairness remains ambiguous. A single senior with a retirement income of $50,000 has the same per capita income as a two-earner family with $250,000 and three children. Yet the retired senior would be exempt from income tax, under this plan, while the large working family would be required to pay federal and state taxes of up to 46% on their next dollar of income while losing valuable deductions (e.g., for state income taxes and mortgage interest) and also losing five personal exemptions (which were supposed to be partial compensation for the added expense of supporting a larger family). The fairness of such a reallocation of tax burdens is, to put it mildly, not self-evident.”