All Your Money Are Belong to Us

In his State of the City Address, New York mayor Bill de Blasio laid out his governing philosophy succinctly:

Here’s the truth, brothers and sisters, there’s plenty of money in the world. Plenty of money in this city. It’s just in the wrong hands!

The money, of course, is in the hands of those who earned it. In de Blasio’s view, people who earn too much are “the wrong hands.”

In the speech itself and in an interview with Jake Tapper on CNN’s “State of the Union,” he elaborated: the wealthy have too much money because they aren’t taxed enough.

There are whole books on the correct theory of taxation. De Blasio, like many politicians, seems operate on the theory most clearly enunciated in 1990 by Sen. Barbara Mikulski (D, Md.):

Let’s go and get it from those who’ve got it.

There are many theories of taxation, such as Haig-Simons, the Tiebout model, and the Ramsay Principle. But I’d bet that the Mikulski Principle explains actual taxation best. And as “progressives” are feeling their oats, we can expect more politicians and pundits to be asking, “Who’s got the money? Let’s go get it.”

Posted on January 17, 2019  Posted to Cato@Liberty

David Boaz and John Samples join Caleb Brown to discuss the new congress

Posted on January 7, 2019  Posted to Cato@Liberty

Did Rand Paul Persuade Trump to Withdraw from Syria?

In the Washington Post, Josh Rogin warns us that “Rand Paul is quietly steering U.S. foreign policy in a new direction.” Indeed, the Post’s overwrought headline is 

Welcome to the world of President Rand Paul

Rogin goes on:

Several U.S. officials and people who have spoken directly to Trump since his Syria decision tell me they believe that Paul’s frequent phone conversations with Trump, wholly outside the policy process, are having an outsize influence on the president’s recent foreign policy decisions. The two golf buddies certainly are sounding a lot alike recently….

Paul told CNN on Dec. 23 that he had talked to Trump about Syria and was “very proud of the president.” That night on Twitter, Trump quoted Paul as saying, “It should not be the job of America to replace regimes around the world… The generals still don’t get the mistake.”

If Paul did in fact persuade the president to withdraw U.S. troops from one of the seven military conflicts we’re currently engaged in, Bravo. He tried to keep us out of the Syrian conflict back in 2013. That’s not Rogin’s view, though. He grumbles:

Of course, there’s nothing wrong with a senator advising the president on foreign policy. Hawks such as Sen. Tom Cotton (R-Ark.) and Lindsey O. Graham (R-S.C.) do it all the time. But the Trump-Paul bromance is troubling because Trump may be taking Paul’s word over that of his own advisers. 

Well, presidents are allowed to choose their own advisers. But how is it “troubling” that Trump might take advice from Senator Paul, but it’s fine to take advice from Senators Cotton and Graham? And by the way, check the quote above: how is a president’s conversation with a member of the Senate Foreign Relations Committee “wholly outside the policy process”?

Of course, Paul isn’t responsible for the fact that Trump is unable or unwilling to set a clear policy, implement it in an orderly manner, articulate a defense of it without using “alternative facts” and words like “suckers,” and make an inspirational, presidential speech to troops in a combat zone. It’s better to withdraw from unnecessary wars inarticulately than to stay in them with a 500-page report.

Rogin concludes by bemoaning “dangerous … isolationism [and] retreat.” “Isolationism” is a term that the foreign policy establishment throws around any time anyone questions whether all seven wars are actually wise. The New York Times also uses the term, reporting that the Syrian withdrawal “has been condemned across the ideological spectrum,” “with the exception of a few vocal isolationists like Senator Rand Paul.” And a few realists and noninterventionists like my colleagues John Glaser and Christopher Preble. And about half the American people.

Posted on December 28, 2018  Posted to Cato@Liberty

The American Idea Is Still Alive

Trying to stay positive in this season of rising trade tensions and plunging stock markets, I return to a Washington Post story from a few weeks ago by Jenna Johnson from Ohio, where a General Motors plant is likely to close in 2019. That’s obviously not positive news for workers, suppliers, and others affected by the plant closing. What was encouraging was the attitudes Johnson found when she interviewed people at an auto-parts store:

Eight miles northwest of the General Motors assembly plant expected to close next year, two workers and a customer at an auto-parts store pointed fingers: Americans just don’t want to drive small cars like those produced at the plant. Gas prices are low, making big vehicles even more attractive. And GM can get cheaper labor elsewhere.

But none of the three men pointed a finger at President Trump, who had promised residents here and throughout the industrial Midwest that he would stop the closure of factories. At one political rally in the area last year, he even urged residents to stay put and not sell their homes.

“It’s a company. Why should the president of the United States be allowed to tell a company what to do?” said Michael Hayda, 64, a former factory worker and a driver at the store who is registered as a Democrat and voted for Trump in 2016.

We sometimes forget that many Americans retain that old American regard for free enterprise and limited government. Others in the store had the same attitude:

His co-worker Bill McKlveen, another Democrat who voted for Trump, agreed and noted that auto-industry workers have been getting pink slips for decades, long before Trump took office.

And even a customer who would like to see Trump impeached said he doesn’t fully fault the president.

“There’s only one law we all obey, and that’s the law of supply and demand,” said Paul Niemi, 68, who fixes wood pallets for a living and was motivated by Trump to vote for the first time earlier this month, selecting a straight Democratic ticket in the midterm election.

Not everybody agreed. Factory worker Tara Gress complained, “It’s a big company. They don’t care. . . . It’s a business. We’re numbers. It doesn’t matter. All of the begs and pleads for this community, it’s not going to make a difference.” Still, those attitudes – plants are closing because of supply and demand, and it isn’t the president’s business to tell companies what to do – are part of what has given us the world’s most dynamic economy for most of the past two centuries. 

For all the talk about socialism, Americans still prefer free enterprise. It’s not good that 37 percent of Americans told Gallup they had a positive image of socialism, but 79 percent had a positive view of free enterprise and 86 percent of entrepreneurs.

In 2017 Gallup found that 67 percent of Americans believed big government was a bigger threat to the future than big business was. Only 26 percent picked big business, and 5 percent said big labor. And when it comes to presidents telling companies what to do, well, almost no one in the new Gallup poll thinks the federal government has too little power: just 8 percent, about where it’s been since 2002.

The men the Post interviewed in Warren, Ohio, display an American sense of life – an attitude of individualism, self-reliance, economic opportunity, and skepticism toward power and government. Something to appreciate in this season.

Posted on December 24, 2018  Posted to Cato@Liberty

How People in 1968 Used Jury Nullification to Block Unreasonable Arrests

In a series of retrospectives on 1968, NPR reports on a sort of jury nullification that took place in Long Island and created a pre-Stonewall victory for gay rights and sexual freedom. In the summers, gay men would come out from New York City and elsewhere for sunbathing, house parties, and in some cases anonymous sex in a wooded area between the towns of Cherry Grove and Fire Island Pines. And some were arrested, fined, or even imprisoned. Then in 1968 some decided to fight back and hired a lawyer willing to fight for them:

In the autumn of 1968, close to two dozen gay men were acquitted of consensual sodomy charges in a series of criminal trials on Long Island. The trials and acquittals marked a pivotal moment in what eventually became the gay rights movement. They demonstrated to the larger gay community — then mainly closeted — that gay people could band together to resist police harassment….

In late August, 1968, police arrested 27 men in Cherry Grove. A few pleaded guilty to consensual sodomy and payed a fine of $250. But 22 men fought the charges in court.

Benedict Vuturo, a prominent Long Island criminal defense lawyer, was retained by the Mattachine Society. In the fall of 1968 Benny Vuturo, as he was known, demanded jury trials for all of the gay men he was defending.

“Benny said there’s terrible crimes on the mainland of Long Island, murders and rapes, and here the cops go and they beat the bushes and try to find these gay fellas who are not harming anyone,” said reporter Karl Grossman, who covered some of the trials for the Long Island Press.

“The juries, one after another, concurred, and they found the defendants not guilty, not guilty, not guilty. And that was the end of the police raids on Fire Island. To me, it really was a testament to the common sense of eastern Long Island residents who served on those juries, and to the jury system.”

Vuturo was hoping to lose one of the trials so he could challenge New York’s sodomy law but he won every case.

The state’s sodomy law was overturned in 1980, 12 years after the Fire Island trials. 

There wasn’t much doubt that the men had been doing what the law prohibited. Yet Long Island juries found them not guilty. That’s a phenomenon often called jury nullification, defined by the Legal Information Institute as “A jury’s knowing and deliberate rejection of the evidence or refusal to apply the law either because the jury wants to send a message about some social issue that is larger than the case itself, or because the result dictated by law is contrary to the jury’s sense of justice, morality, or fairness.” Read more about jury nullification in this Cato Institute book and in a Wall Street Journal article discussed here. It won’t surprise you to hear that judges and prosecutors don’t want juries to know their rights. I wrote about Stonewall here.

It turns out that NBC News covered the 1968 Fire Island story four months ago.

Posted on December 18, 2018  Posted to Cato@Liberty

The Benefits of Frictionless Trade, as Seen in Saarland

The European Union comes in for a lot of criticism, including around these parts. Not all my colleagues have been so critical. Still, burdensome regulations by an unaccountable bureaucracy would trouble any libertarian. 

But this article in the Washington Post reminded me of the original promise of the Common Market, which grew into the European Union:

The degree to which the European Union’s post-nationalist vision has transformed the continent is evident in the German region of Saarland, an area of 1 million residents hard on the French border. 

The region — marked by lush forests, gentle hills and rich coal deposits that once made Saarland an industrial jackpot — has changed hands eight times over the past 250 years. In the past century alone, it was traded between France and Germany four times.

The first of those came in the aftermath of World War I, when France claimed the territory as compensation for German destruction of France’s own coal industry.

Germany lost the land again after World War II and only got it back in 1957.

As recently as the 1990s, the nearby border was subject to strict controls. But today, it’s largely invisible. French citizens commute to Saarland for work or pop by to buy a dishwasher. Germans cross Saar into France for lunch or to pick up a bottle of wine. French — the language of the longtime enemy and occupier — is part of the fabric of Saarland, and it’s welcome.

“We’re neighbors. We’re friends. We marry each other. One hundred years ago, we killed each other. It’s been a great evolution,” said Reiner Jung, deputy director at the Saar Historical Museum in the region’s capital, Saarbrücken.

Of course, countries could drop their trade barriers without creating a supranational bureaucracy. But too many people misunderstand economics and believe giving up their trade barriers is a cost, so creating a customs union, a common market, or even a European Union may often be the only way to get the substantial benefits of free trade. And frictionless trade is even harder to achieve without multinational negotiations. So there are pros and cons to arrangements such as the European Union, but we shouldn’t underestimate the great benefits of commerce and movement across national borders.

Posted on November 16, 2018  Posted to Cato@Liberty

Midterm Elections Review and Policy Outlook

What do the midterm election results mean for liberty? David Boaz knows that the impact of shifting partisan majorities is rarely a clear-cut good or bad. What new opportunities for positive change could come from a Democratic House? Will the expanded Republican majority in the Senate help with the confirmation of originalist judges? Are we heading towards an impeachment battle?

While the new alignment on Capitol Hill offers some potential for improvement, there is always the concern for bipartisan “compromise” at the expense of the American people. Republicans and Democrats might get together and agree to grow government and spend more, in which case the gridlock that commonly accompanies divided government might be preferable.

Join us as David Boaz answers these and other questions in his breakdown of the election results and how they will impact Cato’s work going forward.

Posted on November 13, 2018  Posted to Cato@Liberty

The Senselessness of World War I, from Beginning to End

One hundred years ago Sunday, at the eleventh hour of the eleventh day of the eleventh month of 1918, the bloodiest war in history ended. In the New Yorker, historian Adam Hochschild writes about the senseless beginning of the war in an “epic chain of blunders, accusations, and ultimatums” and about its senseless end: “In the five weeks since the Germans first requested peace negotiations, half a million casualties had been added to the war’s toll…. Worse yet, British, French, and American commanders made certain that the bloodshed continued at full pitch for six hours after the Armistice had been signed [at 5 a.m., with the news immediately radioed and telephoned to commanders on both sides].”

Wilson's War book cover Jim Powell

Cato senior fellow and historian Jim Powell wrote about the blunders and consequences of World War I in his book Wilson’s War: How Woodrow Wilson’s Great Blunder Led to Hitler, Lenin, Stalin, and World War IIHe summarized his argument in Cato Policy Report four years ago:

World War I was probably history’s worst catastrophe, and U.S. President Woodrow Wilson was substantially responsible for unintended consequences of the war that played out in Germany and Russia, contributing to the rise of totalitarian regimes and another world war. 

Indeed World War I was a catastrophe, a foolish and unnecessary war, a war of European potentates that both England and the United States could have stayed out of but that became indeed a World War, the Great War. In our own country the war gave us economic planning, conscription, nationalization of the railroads, a sedition act, confiscatory income tax rates, and prohibition. Internationally World War I and its conclusion led directly to the Bolshevik revolution, the rise of National Socialism, World War II, and the Cold War. 

On this weekend as we celebrate the end of this tragedy we should mourn those who went to war, and we should resolve not to risk American lives in the future except when our vital national interests are at stake.

Posted on November 9, 2018  Posted to Cato@Liberty

David Boaz gives a lecture on libertarianism at Claremont McKenna College

Posted on October 29, 2018  Posted to Cato@Liberty

Young People like ‘Socialism,’ but Do They Know What It Is?

Fifty-seven percent of Democrats and 51 percent of young people have a positive view of socialism, Gallup reports, slightly more than those who have a positive view of capitalism. That’s frightening. The record of socialist countries, from the Soviet Union and Mao Zedong’s China to today’s Venezuela, is horrific: little or no economic growth, hunger, authoritarian government, people risking their lives to flee.

So why are people talking about socialism again? It seemed to start with Senator Bernie Sanders’s presidential campaign in 2016. Then came a new breed of Democrats fed up with the influence of money in both parties, typified by Alexandria Ocasio-Cortez’s upset victory over a prominent Democratic congressman. The Democratic Socialists of America (DSA) says its membership skyrocketed after Ocasio-Cortez’s June win.

Americans like free enterprise, and very few of them want a more powerful government.

Socialism is back, after seemingly being buried in the dustbin of history with the collapse of the Soviet Union in 1989, for several reasons. Young people never knew, and many older voters have forgotten, what the Union of Soviet Socialist Republics (USSR) and its Eastern European client states were like. The financial crisis of 2008 certainly gave capitalism a bad name. Bailouts for Wall Street, a very slow economic recovery, and endless wars left people on all sides of the political spectrum looking for alternatives. For some people that alternative was a tough-talking billionaire president, but with his harsh rhetoric toward immigrants and other groups, he seemed like a typical unfeeling capitalist to many other voters.

So now half of Americans 18-29 say they have a positive view of socialism. But there’s a lot of confusion about what that means. The traditional definition of socialism, as summarized in the Concise Encyclopedia of Economics, is “a centrally planned economy in which the government controls all means of production.” That’s what the Communist Party implemented in the Soviet Union and China. It was the goal of the British Labour Party, and the nationalizations of coal, iron and steel, railroads, utilities, and international telecommunications after World War II led to decades of economic stagnation.

But most American “socialists” probably don’t support government ownership of the means of production. Ask self-proclaimed socialists what they want, and you get vague and lovely answers. Ocasio-Cortez says that “in a modern, moral and wealthy society, no person in America should be too poor to live.” In the Liza Minnelli musical Flora the Red Menace, the Communist organizer sings, “Are you in favor of democracy, the rights of man, everlasting peace, milk and cookies for the kids, security, jobs for everyone, and against slums, the filthy rich, and making cannon fodder of our youth? Then you’re a Communist!”

Sanders has often pointed to Denmark as an example of democratic socialism. But don’t tell that to the Danes. In 2015 the Danish prime minister said he knew that “some people in the U.S. associate the Nordic model with some sort of socialism. I would like to make one thing clear. Denmark is far from a socialist planned economy. Denmark is a market economy.”

If Denmark is the model for today’s American socialists, then they should leave the DSA and join Democrats for Higher Taxes and Transfer Payments.

A deeper dive into Gallup’s latest poll shows a decided lack of interest in the kind of government control that socialism would entail. Asked if they had a positive or negative image of various things, respondents gave very high marks to small business, entrepreneurship, and free enterprise, and 56 percent approval to capitalism. The federal government and socialism lagged far behind at 39 and 37 percent. (These are numbers for all respondents, not just young people as above.)

Only 44 percent agreed that “government should do more to solve our country’s problems.” Only 25 percent said there is too little government regulation of business, 39 percent said too much, and 33 percent the right amount. In 2017 Gallup found that 67 percent of Americans believed big government was a bigger threat to the future than big business was. Only 26 percent picked big business, and 5 percent said big labor.

Perhaps most telling: If socialism means anything, it means giving more power to government. But almost no one in the new Gallup poll thinks the federal government has too little power: just 8 percent in the new poll, about where it’s been since 2002.

There’s lots of talk in the United States about socialism these days, and lots of debate about how high taxes and spending ought to be. But Americans like free enterprise, and very few of them want a more powerful government.

Posted on October 25, 2018  Posted to Cato@Liberty

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