Topic: Political Philosophy

Three Cheers for the Rule of Law: Holding Deadbeat Debtor Argentina to Account

Being a creditor is a thankless task. The worst offenders are governments, whose leaders constantly promise their peoples a free lunch, dinner, and more. 

Argentina is a typical offender. One of the world’s richest nations at the end of World War II, the South American country embraced political authoritarianism and economic populism. In the most recent Economic Freedom of the World rating Argentina came in at 137 of the 152 nations rated. 

The country’s worst measure is rule of law, which is reflected in its treatment of international creditors—and steadfast resistance to U.S. court rulings ordering Buenos Aires to pay its debts.

In 2001 Argentina defaulted on nearly $100 billion in debt. The Argentine people essentially had a wild party and woke up with a hangover. Their first reaction was to stiff the fools who had extended credit. Owners of roughly 93 percent of the debt gave in and restructured their paper, accepting huge write-offs.

A New Libertarianism.org, a New Podcast, and 100 Excursions

Today’s kind of a big deal over at Libertarianism.org.

To start with, the Cato Institute’s resource on the theory and history of liberty unveiled a completely new look, one designed from the ground up to work great on mobile devices like smartphones and tablets. And we created a new way to browse all of Libertarianism.org’s content from within a single, intuitive interface.

We’ve also launched Libertarianism.org’s first podcast, “Free Thoughts.” Hosted by Trevor Burrus and me, it’s a bi-weekly discussion show about libertarianism and the ideas that influence it. The first episode is on politics and community and the relationship between them. In the coming weeks, we’ll have episodes on money and political speech, commodication, Robert Nozick’s Anarchy, State, and Utopia, and much more. You can subscribe in iTunes—or via RSS.

Finally, today we published the 100th Excursions essay from George H. Smith. Smith is an authority on libertarian intellectual history and author of the new book The System of Liberty: Themes in the History of Classical LiberalismEvery week for the last two years, Libertarianism.org has published a new essay from Smith. His 100th looks at Adam Smith, standing armies, and competition in education.

It’s an exciting day for Libertarianism.org. And we’ve got much more to come.

Wise Words on Fiscal Sovereignty and Corporate Taxation (sort of) from Bill Clinton

I’ve always had a soft spot in my heart for Bill Clinton. In part, that’s because economic freedom increased and the burden of government spending was reduced during his time in office.

Partisans can argue whether Clinton actually deserves the credit for these good results, but I’m just happy we got better policy. Heck, Clinton was a lot more akin to Reagan that Obama, as this Michael Ramirez cartoon suggests.

Moreover, Clinton also has been the source of some very good political humor, some of which you can enjoy here, here, here, here, and here.

Most recently, he even made some constructive comments about corporate taxation and fiscal sovereignty.

Here are the relevant excerpts from a report in the Irish Examiner.

It is up to the US government to reform the country’s corporate tax system because the international trend is moving to the Irish model of low corporate rate with the burden on consumption taxes, said the former US president Bill Clinton. Moreover, …he said. “Ireland has the right to set whatever taxes you want.” …The international average is now 23% but the US tax rate has not changed. “…We need to reform our corporate tax rate, not to the same level as Ireland but it needs to come down.”

Kudos to Clinton for saying America’s corporate tax rate “needs to come down,” though you could say that’s the understatement of the year. The United States has the highest corporate tax rate among the 30-plus nations in the industrialized world. And we rank even worse—94th out of 100 countries according to a couple of German economists—when you look at details of how corporate income is calculated.

Can the Communist Party Take Back the Czech Republic?

PRAGUE, CZECH REPUBLIC—The Czech Republic is one of the most successful members of the former Soviet Empire. Yet Czechs with whom I recently spoke fear liberty is in retreat. The former Communist Party might reenter government after elections later this month. 

Czechoslovakia was “liberated” by the Red Army at the end of World War II. After the Berlin Wall fell on November 9, 1989, the so-called Velvet Revolution ousted the Czech Communist Party. Czechoslovakia soon adopted wide-ranging free market economic reforms and split into the Czech Republic and Slovakia. 

In March Milos Zeman became the country’s first popularly elected president. The former Social Democratic prime minister has roiled Czech politics by claiming ever more expansive authority. 

Most dramatically, after the prime minister’s summer resignation President Zeman appointed a leftist government against the wishes of the parliamentary majority. The new cabinet lost a vote of confidence, but remains as caretaker until the upcoming election. 

Equally controversial are the president’s policies.  As I wrote in my new Forbes online article:

Moreover, the president reversed course on the EU after appealing to supporters of the Euro-skeptic [former President Vaclav] Klaus during the presidential campaign.  Once in office President Zeman hoisted the EU flag over the Prague Castle, which hosts the presidential office, and signed the European Stability Mechanism, the EU bail-out fund.  He describes himself as a “Euro-Federalist,” advocates common European fiscal, tax, foreign, and defense policies, and supports adopting the Euro as the Czech currency.

The greater worry is the revival of the Communist Party. As memories of Communist repression fade, some Czechs long for the perceived stability of the past. 

“Why Liberty?”

Need something to read during the shutdown? You’re in luck, because Students for Liberty and the Atlas Network have released a new book of original essays on the question, “Why Liberty?” It includes a piece on the humble case for liberty by yours truly, and is packed with great stuff. But you don’t have to take my word for it. Here’s the book’s editor, Cato senior fellow Tom G. Palmer:

You can order a copy online or snag a free PDF. 

Germany Votes against Limited Government

The world’s most watched elections occur in America. The world’s most boring election just occurred in Germany. As expected, Chancellor Angela Merkel was effectively reelected.

The Federal Republic of Germany is the world’s most admired nation and possesses Europe’s largest economy. Berlin’s political and economic stability is the envy of the European Union.

Merkel has served as chancellor for eight years. A skilled political infighter, she exudes confidence and competence.

Germans rewarded her Christian Democratic Union (CDU) and its sister party, the Christian Social Union (CSU), with 41.5 percent of the vote, well ahead of the more left-wing Social Democratic Party. However, the CDU/CSU fell five seats short of a parliamentary majority. And Merkel current coalition partner, the Free Democratic Party, failed to receive the 5 percent of the vote necessary to be represented in the Bundestag.

Commentary on the election has focused on Merkel’s triumph. There is little doubt that she will remain chancellor. The only question is the identity of her coalition partner–and what price she will have to pay for that party’s support.

Ironically, policy isn’t likely to change very much as a result of the election. Merkel has steadily pulled her party leftward. Cem Ozdemir, co-chair of the Green Party, complained that the chancellor “becomes Green when it helps her and becomes a Social Democrat when that’s beneficial too.”

Alas, her policies helped wreck Germany’s liberal Free Democratic Party (FDP). The Free Democrats were created in 1949 and have served in the Bundestag ever since. In 2009 they made their best showing ever, 14.6 percent. Now, with just 4.8 percent of the vote, they are out of the Bundestag.

Ted Cruz Speech Nods to Increasing Libertarian Views within Republican Party

During his Ironman 21-hour speech, Sen. Ted Cruz read excerpts from Ayn Rand’s Atlas Shrugged, name-dropped “libertarians” at least six times, and yielded to Sen. Rand Paul, who invoked Frederic Bastiat’s “What is Seen and Unseen,” a favorite among libertarians.

Ted Cruz, who retained remarkable composure over the long night, seems in all things deliberate. Political leaders seem to have become more comfortable talking about libertarians, even identifying themselves as such. Libertarians may have reached a tipping point within the Republican Party.

Last week, a FreedomWorks study on public opinion found that libertarian views within the Republican Party are at the highest point in a decade, today representing 41 percent of Republican voters. This is a strong claim. It’s worth explaining the methodology behind the study, as libertarian views gain more and more attention in the press.

As David Boaz and I have noted in our two studies on the Libertarian Vote, and ebook with Emily Ekins, Gallup has tracked “libertarian” beliefs since 1993 using a combination of two questions on the role of government:

  • Some people think the government is trying to do too many things that should be left to individuals and businesses. Others think that government should do more to solve our country’s problems. Which comes closer to your own view?
  • Some people think the government should promote traditional values in our society. Others think the government should not favor any particular set of values. Which comes closer to your own view?

Gallup defines libertarians as those who think government is doing “too many things” and should not “promote traditional values.”

In the chart below the jump, Gallup data show a 19 percentage point increase in libertarian views among Republicans and Republican leaning independents in the decade between 2002 and 2012. In 2002, libertarians represented 15 percent of Republicans; in 2012, 34 percent.