September 2, 2016 12:55PM

It Couldn’t Happen Here?

Dilma Rousseff was never as popular as the president who anointed her as his successor. Despite her intelligence and diligence in numerous official posts, she lacked his warm personality and flair for campaigning. But she ran a very professional presidential campaign, with lots of celebrity supporters, and the vigorous support of her predecessor, and she won the election and became Brazil’s first female president. In office she pursued policies of easy money, subsidized energy, and infrastructure construction, which initially boosted her popularity. As is so often the case, though, those populist programs eventually brought inflation and a slide into economic contraction. Simultaneously, allegations of corruption and cronyism hurt her reputation. Impeachment proceedings were brought against her, focused on her mismanagement of the federal budget, particularly employing budgetary tricks to conceal yawning deficits. “Experts say Ms. Rousseff’s administration effectively borrowed some $11 billion from state banks, an amount equal to almost 1 percent of the economy, to fund popular social programs that have been a hallmark of the Workers Party’s 13 years in power.” Some said that such fiscal mismanagement and dishonesty were common in presidential administrations and should not result in impeachment. But the Senate convicted her and removed her from office, making her bland vice president the new president.


Thank goodness nothing like that could happen in our own country.

August 22, 2016 12:27PM

Hillary Clinton’s “Exit Tax” Is an Unseemly Example of Banana Republic Economics

If you get into the weeds of tax policy and had a contest for parts of the internal revenue code that are "boring but important," depreciation would be at the top of the list. After all, how many people want to learn about America's Byzantine system that imposes a discriminatory tax penalty on new investment? Yes, it's a self-destructive policy that imposes a lot of economic damage, but even I'll admit it's not a riveting topic (though I tried to link it to popular culture by using ABBA as an example).

In second place would be a policy called "deferral," which deals with a part of the law that allows companies to delay an extra layer of tax that the IRS imposes on income that is earned - and already subject to tax - in other countries. It is "boring but important" because it has major implications on the ability of American-domiciled firms to compete for market share overseas.

Here's a video that explains the issue, though feel free to skip it and continue reading if you already are familiar with how the law works.

The simple way to think of this eye-glazing topic is that "deferral" is a good policy that partially mitigates the impact of a bad policy known as "worldwide taxation."

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August 12, 2016 10:05AM

Not My Commander in Chief

Hillary Clinton declares on the campaign trail, “Donald Trump simply doesn’t have the temperament to be president and commander in chief of the United States.” Thankfully, he isn’t going to be — not because of his standing in the polls, but because there is no such position as “commander in chief of the United States.”


This is a constitutional republic, and we don’t have a commander in chief. According to Article II of the Constitution, “The President shall be Commander in Chief of the Army and Navy of the United States.”


That’s an important distinction, and it’s disturbing that any candidate for the presidency would miss it. Hillary Clinton may want to be commander in chief of the whole country, of you and me, and to direct us and our economic activities the way the president directs the officers and soldiers of the armed forces. But if so, she needs to propose an amendment to the Constitution — an amendment that would effectively make the rest of the Constitution irrelevant, since it was designed as a Constitution for a limited government of a free people.


Much as they might both wish it, neither Donald Trump nor Hillary Clinton is going to be my commander.

July 6, 2016 11:15AM

We’ve Been over the Huge Price of “Free” College before

Hillary Clinton will be introducing a plan today that would enable students from families eventually making up to $125,000 not to have to pay tuition at in‐​state colleges or universities. This is a jump in college subsidization from her previously announced plan, which focused on debt-free tuition, and more in line with what Bernie Sanders has proposed. Presumably, it is going to be paid for by the federal government offering states more money for higher education in exchange for states saying they’ll increase their own spending, to a point of making tuition largely free.


We’ve been over how costly “free” college really is – massive overconsumption, credential inflation, big opportunity costs for taxpayers, etc. – which you can read about here and here. I won’t rehash it all now. But the political calculus hasn’t changed: People like getting things for free, especially when the ultimate costs are hidden. And the more people who think they’ll benefit – the estimate is 8 out of 10 for Ms. Clinton’s new proposal – the better.

July 6, 2016 9:52AM

Should Teachers Have to Pay for Gushing over Clinton? (Or Trump? Or Gary Johnson? Or…)?

At just about the same time FBI Director James Comey was discussing how “extremely careless” Hillary Clinton was with classified information during her time as Secretary of State, the president of the National Education Association, the nation’s largest teachers union, was tweeting this:

And this:

And doing this:

All of this, by the way, took place at the NEA’s national convention.


Now, is there anything wrong with a union endorsing and campaigning for a presidential candidate? Heck no! But there is a huge problem when teachers, as a condition of working at government schools, are required to furnish funds for those unions.


I know the response: The “agency fees” teachers in many states are compelled to supply only cover collective bargaining, which is not political. Of course, such bargaining is absolutely political—negotiating with government entities is inherently political — and somtimes coming in at 65 percent or more of full dues, a lot of agency fee money is almost certainly going to more than just collective bargaining and administrative stuff. And money is fungible. Dollars that free payers supply for collective bargaining ultimately frees up other bucks for, I don’t know, maybe straight‐​out politicking!


Sadly, as you probably know, the U.S. Supreme Court tied up on this 4 – 4 earlier this year, maintaining a lower court ruling that agency fees are not a violation of constitutional speech and association rights. But just because the Supreme Court stumbled doesn’t mean the political branches of government can’t act to end forced union funding. And from I saw on Twitter yesterday, justice requires that compelled support of unions end.

June 27, 2016 8:56AM

The Complicated Clinton Organization

Where did Hillary Clinton’s campaign get the “I’m with her” slogan that Donald Trump criticized last week? I saw this in the Washington Post:

Ida Woldemichael, a designer who came up with “I’m with Her” for the Clinton campaign,…is a graphic designer who worked for the Clinton Foundation before joining the campaign about a year ago.

Not that the Clinton Foundation is any kind of tax‐​exempt, dictator‐​supported, $2 billion advance team for the Clinton campaign.

June 2, 2016 12:15PM

Johnson and Weld Are Right, Clinton Is Wrong: Congress Should Privatize the VA

Listening to Hillary Clinton put her big-government ideology before the needs of veterans (see below video) brings to mind an email exchange I had recently with a correspondent who had questions about privatizing Medicare, Medicaid, and the Veterans Health Administration.

The video is an interview with Libertarian presidential and vice presidential candidates Gary Johnson and Bill Weld into which MSNBC interjected a telephone interview with Democratic candidate Hillary Clinton. Clinton protests (starting at 4:20) that Congress should not privatize the VHA, while Bill Weld, a former two-term Republican governor of Massachusetts, gives one of the best explanations I've seen of why it should (10:00).

The email exchange follows the video.

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