David Boaz

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.

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.

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.

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.

I don’t know much about Keith Fimian, the Republican candidate for Congress in Fairfax County, Virginia, but I kind of like the tag line he ends his TV ad with:

GERRY CONNOLLY

TOO CORRUPT.

EVEN FOR CONGRESS.

As it turns out, though, he’s probably not.

At John McCain’s rally Saturday in Springfield, Virginia, the audience chanted “Keep Virginia Red!” as McCain denounced Barack Obama for being a socialist. Say what?

It was very clever of the TV networks back in 2000 to insist on red for Republicans and blue for Democrats; it had often been the reverse in earlier elections. David Brinkley spoke of Ronald Reagan’s “sea of blue” in 1980, and Time wrote in 1984, “On NBC’s national map, a spreading sea of blue represented Reagan’s triumph, and little islands of red symbolized Mondale’s meager winnings; on ABC and CBS maps, the color symbolism was reversed.” NBC that year — like other networks in previous years — was in keeping with the worldwide use of political colors, where typically red represents communism, socialism, and social democracy and blue is associated with conservative parties. But when the dominant U.S. media all decided to paint the Democrats blue and Republicans red, they got rid of that pesky, lingering association of red with socialism.

And it’s worked so well that Virginia Republicans chant “Keep Virginia Red!”

The lead story in today’s Washington Post — above the economy, above the election — is a warning that the Bush administration may deregulate something before it leaves office. Here’s the online headline and subhead:

White House Makes a Last Push to Deregulate

New regulations, which would weaken rules aimed at protecting consumers and environment, could be difficult for next president to undo.

The story begins:

The White House is working to enact a wide array of federal regulations, many of which would weaken government rules aimed at protecting consumers and the environment, before President Bush leaves office in January.

The new rules would be among the most controversial deregulatory steps of the Bush era and could be difficult for his successor to undo. Some would ease or lift constraints on private industry….

Once such rules take effect, they typically can be undone only through a laborious new regulatory proceeding, including lengthy periods of public comment, drafting and mandated reanalysis.

OK, that’s news. A fair story. Although of course the reporter quotes no economist critical of regulation — just a couple of White House flacks and a business lobbyist — though he does quote at least three pro-regulation “public interest” activists issuing dire warnings of impending doom.

But I was curious: Did the Post run a prominent story a few days before the 2000 election about the Clinton administration’s push to impose sweeping regulations before they left office? You know the answer: of course they didn’t. Before election day, according to a Nexis search, there was one reference at the tail end of the jump of a Post story in the Business section to the Mercatus Center’s Midnight Regulations website. So they knew about the problem — Mercatus was publicizing it, and the Houston Chronicle ran a front-page story — but the Post didn’t think voters needed to know.

Even though, as today’s story mentions after the jump,

[T]he last-minute rush appears to involve fewer regulations than Bush’s predecessor, Bill Clinton, approved at the end of his tenure. …

“Through the end of the Clinton administration, we were working like crazy to get as many regulations out as possible,” said Donald R. Arbuckle, who retired in 2006 after 25 years as an OMB official.

Maybe they didn’t quite grasp the problem back in 2000. We’ll see whether there are such stories toward the end of the Obama administration in the Post — and on Diane Rehm, and on ABC News, and in the New York Daily News, and all the other places that are very concerned about “midnight deregulation.”

Is Barack Obama a socialist? That’s the question Cato adjunct scholar Don Boudreaux asks in one of the last paper editions of the Christian Science Monitor. Not really, he concludes. But

Anyone who speaks glibly of “spreading the wealth around” sees wealth not as resulting chiefly from individual effort, initiative, and risk-taking, but from great social forces beyond any private producer’s control….This “socialism-lite,” however, is as specious as is classic socialism. And its insidious nature makes it even more dangerous. Across Europe, this “mild” form of socialism acts as a parasitic ideology that has slowly drained entrepreneurial energy – and freedoms – from its free-market host.

So why does he say that Obama is not a socialist? Well, after all,

“Socialism” originally meant government ownership of the major means of production and finance, such as land, coal mines, steel mills, automobile factories, and banks.

And no American politician would favor that, right? Oh, right.

“There’s no logical end to it,” Cato Senior Fellow Gerald P. O’Driscoll Jr. said to Neil Cavuto on Fox Business. He’s talking about the incredible expanding bailouts. It started with Bear Stearns in March and then homebuilders in April. Then Fannie Mae and Freddie Mac in September, and after that the deluge. AIG, announced at $85 billion but quietly increased to $123 billion so far, and the $700 billion centerpiece and then money market funds and then bank nationalizations and an increase in the federal guarantee to bank depositors. Where will it stop?

Friday’s papers noted that the head of the FDIC said that the federal government might start guaranteeing home mortgages. On Saturday we learned that insurance companies want to get a piece of the money. Yesterday the Treasury said that automobile companies–which already got their own $25 billion program–might also be eligible for the general “financial rescue plan,” and their success might encourage other industries to try to get in on it.

As I noted before, Congress is talking about “a second economic stimulus package, totaling $50 billion in the form of money for infrastructure projects, relief for state governments struggling with rising Medicaid costs, home heating assistance for the Northeast and upper Midwest, and disaster relief for the Gulf Coast and the Midwestern flood zone.” And Transportation Secretary Mary Peters wants “an $8 billion infusion” for the federal highway trust fund.

Where does all this money come from? The total cost is hard to estimate, because we don’t know how many of these guarantees will actually result in payments. But some analysts are talking about a total bill of $2-3 trillion. Given the underestimate on the cost of the Iraq war, we shouldn’t have confidence in any claims that it will be less. So where does the money come from? Even Obama doesn’t want to raise taxes that much. And if you tax Americans to bail out as many Americans as we’re now talking about helping, eventually you’re going to be taxing people to bail themselves out. In fact, the government is likely to borrow some of the money and have the Federal Reserve create more of it. That process seems to be under way, as Greg Mankiw and Jeff Hummel have discussed. How can that astounding and unprecedented increase in the monetary base not lead to inflation, even hyperinflation? We’ve already decided to tax the prudent and thrifty to bail out the imprudent and irresponsible. Now the prudent may face a danger even worse than taxes: inflation that erodes their hard-earned savings.

Howard Baker famously called Ronald Reagan’s tax cuts a “riverboat gamble.” This is more like a “Celebrity Solstice gamble.”

David Friedman will talk about his new book, Future Imperfect: Technology and Freedom in an Uncertain World, at a Cato Book Forum next Thursday, November 6.

Speaking at Google and to the San Francisco Chronicle, he describes his thinking this way:

“There are no brakes available. … If it can be done, it will be done,” he said at an event that was recorded and posted on YouTube. “So the interesting thing to me is not what should you stop but how do you adapt.” …

“I’ve got three different technologies that could wipe out the species,” said Friedman, a self-professed libertarian who is certain that neither politics nor central planning will avert a possible bad technological outcome.

“I am much more worried about the government making the wrong response and doing damage than I am about the government not protecting me,” said Friedman, adding: “It’s a mistake to think of the world as if there was somebody in charge. There’s never been anybody in charge.”

David Friedman has been one of the most interesting libertarian thinkers for more than 30 years, since he published his book The Machinery of Freedom. Don’t miss his take on the future of technology and freedom. Sign up here.