Wednesday, October 17, 2018

Trump Tariffs and Trade

(first published in North State Journal 10/17/18)

Tariffs are bad. They are just “taxes” by a different name.

Higher taxes and tariffs retard economic production and growth. The higher the tax, or tariff, the lower amount of product is sold.

Would the imposition of the Trump trade tariffs lead to a worldwide recession all by themselves as some fear? Or will they lead to a tariff-free world which has been the dream of every free market philosopher in history?

The total amount of trade on which new tariffs could be imposed by President Donald Trump is approximately $640 billion in dollar terms on items shipped from China, Canada, Mexico, the EU and Asian Rim countries to the United States.

The amount of business transacted worldwide today is roughly $80 trillion in dollar-denominated terms. Global economic growth is expected to be 5 percent this year, so world GDP could grow by an additional $4 trillion on top of the current level of $80 trillion.

If the tariff rate imposed by the U.S. is 25 percent on $640 billion of trade in volume, $160 billion would be collected by the Trump “tariff/tax hike.”

The Trump-imposed tariffs would represent a miniscule 0.2% percent of world GDP output for the entire year. They would amount to only 4 percent of the nominal GDP growth of the entire world of $4 trillion over the next year.

Both assume that the tariffs will be enacted. Many say President Trump is using the “threat” of imposing tariffs to force nations to the bargaining table to get a better deal for Americans.

What is truly big and significant?

Chinese pilfering of U.S. intellectual property rights.

Based on the 2017 Commission on Theft of American Intellectual Property, U.S. Trade Representative Robert Lighthizer said: “Chinese theft of American IP currently costs between $225 billion and $600 billion (in lost sales or economic value) annually.”

Up to $600 billion annually in America alone; four times the size of the possible Trump tariffs. That is as if the GDP of the state of Ohio is removed from American soil and given to Chinese workers and government enterprises as a gift each year.

China has been stealing intellectual property rights in the form of patents, copyrights and designs for decades from every advanced nation on earth. Intellectual property protection is the core of free enterprise everywhere around the globe. Failure to protect IP from being stolen without due process and payment of royalties devalues every product, service or technological breakthrough American inventors, creators and businesses make every day.

Chinese government and corporate engineers and businesses steal designs and technology from every sector imaginable and then manufacture products at very low wages and costs so Chinese products dominate the market and then destroy their foreign competitors who invented it in the first place.

Why don’t the Chinese worry about protecting their intellectual property rights? If China ever produces innovations as Bill Gates, Steve Jobs or Benjamin Franklin did, maybe then they will start clamoring for intellectual property protection for their products instead of stealing ours.

The Trump strategy appears to be coming into focus: Revamp existing trade agreements with all trading partners around the globe first and then build a worldwide coalition against the Chinese to force them into submitting to the basic tenets of fair play in a world of free trade.

Otherwise, a coalition will in effect erect global trade embargoes on China to bring their economy to its knees until they do agree to play by the rules of free and fair trade.

No previous administration or Congress has taken such a blunt force posture toward China. Gentle or turning-the-other-cheek diplomacy obviously has not worked in the past, so why not try another tactic?


Such blunt force may be the only way to bring China into the community of nations where true free trade can prevail for the 21st century.

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Thursday, October 11, 2018

'Kavanaughed'

 

(first published in North State Journal 10/10/18)

Why does our political discourse get so nasty from time to time?

Human emotions get hyper-inflamed over hot-button issues. In the 19th century, it was slavery. In the mid-20th century, it was communism and then civil rights.

Since 1973, it has been abortion rights post-Roe v. Wade.

Minnesota Senator Joe McCarthy gained nationwide notoriety in the early 1950s by mercilessly accusing 205 public servants in the State Department of being ‘card-carrying communists’ often without offering any evidence to back up his claims.

On June 1, 1950, freshman Maine Senator Margaret Chase Smith gave a speech on the floor of the US Senate as the first Senator to take McCarthy to task for his reckless ways which was the beginning of the end for him politically.

On June 9, 1954, Joseph Welch, attorney for the Army during the Army-McCarthy hearings destroyed McCarthy with this statement: ‘Have you no sense of decency, sir, at long last? Have you left no sense of decency?’

68 years later, another brave Maine Senator, Susan Collins stepped up to reverse the collapse of decency which hopefully hit its denouement in the Kavanaugh hearings.

Nowhere has vitriol been more on display than during US Supreme Court nominations since 1987:

  • Robert Bork was ‘borked’ where Senate Democrats opposed to his view of constitutional originalism used every possible negative tactic to defeat him which worked when he lost 42-58; 
  • Anthony Kennedy was subsequently unanimously confirmed; 
  • David Souter passed 90-9;  
  • Clarence Thomas was ‘thomased’ after allegations from Anita Hill but narrowly confirmed 52-48; 
  • Justices Ruth Bader Ginsburg, Stephen Breyer and John Roberts were confirmed easily;
  • Bush 43 nominee Harriet Myers withdrew when her legal knowledge and ability to be on the High Court was questioned;  
  • Samuel Alito was confirmed 58-42;  
  • Sonia Sotomayor was confirmed 68-31 with 59 Democrat votes and 9 Republican Senators voting aye; 
  • Elena Kagan was confirmed 63-37 along similar lines; 
  • Obama nominee Merrick Garland was ignored by the Republican Senate because it was a presidential election year; 
  • Trump nominee Neil Gorsuch was confirmed 54-45; and 
  • Brett Kavanaugh was ‘kavanaughed’ but confirmed Saturday to the Supreme Court 50-48.

Students of history will notice that the nominees who were most viciously attacked were conservative Republican jurists. Robert Bork, Clarence Thomas and Brett Kavanaugh were ruthlessly savaged by Democratic Senators in public.

The truth of the matter is that these bloody nomination battles had little to do with personal character issues or even judicial philosophy and temperament.

When a justice was nominated whose judicial philosophy threatened the fragile majority on the Court as it pertains to abortion rights, these nomination fights got nasty very quickly.

The only Democratic nominee who was ‘not treated fairly’ in the eyes of Democrats was Merrick Garland in 2016. Former Democratic Senator Joe Biden, Chairman of the Senate Judiciary Committee had this to say about nominations during a presidential campaign year in 1992:

“(President George H. W. Bush should) not name a nominee until after the November election is completed” (and, if he did), “the Senate Judiciary Committee should seriously consider not scheduling confirmation hearings on the nomination until after the political campaign season is over.”

Republicans followed Senator Biden’s dictum with regards to Judge Garland.

Former Democratic Senate Majority Leader Harry Reid invoked the ‘nuclear option’ when he allowed votes on judicial nominations during the Obama Administration without requiring a 60-vote hurdle to close debate and proceed to the vote on the nomination.

Republicans followed Democratic precedent again with the Gorsuch and Kavanaugh confirmations.

Short of a political truce or a medical technological breakthrough to allow a transfer of a human zygote to another host to take it to term, such nasty political attacks will continue.

The only way to prevent them is to elect new Senators who won’t stoop to such base level tactics to win at any cost.

It does not do the American Republic any good when they do.


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Wednesday, October 3, 2018

Cut All the 'Red Tape' Out of the Federal Budget

first published in North State Journal 10/3/18)

Until 1925, the federal government used to wrap official federal documents in red tape. It made things look ‘official’, borrowing from regal Spanish and British traditions of long ago.

President Calvin Coolidge and his budget director, Herbert Mayhew Lord, with whom he met personally every Monday morning at 9:15 am sharp, reasoned that if they replaced the official ‘red tape’ with regular white string, they could save tens of thousands of taxpayer dollars each year.

So they did.

President Coolidge and Lord literally ‘cut the red tape’ out of government spending.

Even ‘waste in government’ was turned into budget savings. An employee on the General Supply Committee figured that ‘seven barrels of spoiled, soused (pickled) seal shoulders from Alaska’ could be sold for $20 as ‘crab bait’ to New England fishermen.

That $20 was used to pay off some of what was then a very slim national debt of $21 billion. 0.1% of the $21 trillion of national debt we have today.

It worked. Under President Coolidge, the federal budget was reduced to close to $3 billion (not trillion) and held flat for his 6 years in office. As a result of his initial tax cuts, the economy took off and generated surplus revenues to the federal treasury which, combined with budget restraint, allowed the Coolidge Administration to reduce overall federal debt by 33%.

Tax cuts; economic growth; budget restraint, debt repayment. Lather, rinse, repeat and do it again and again and again.

It works.

The major thing missing in that equation in Washington lately has been ‘budget restraint’. We did not have a Calvin Coolidge in the White House when Presidents Obama and Bush 43 were occupants.

It remains to be seen if President Trump will put the brakes on spending; he has 2 more years to become the next Coolidge.

We have not had a majority of 50%+1 Democratic or Republican Calvin Coolidges in the US Senate or Congress either where it really has to start anyway.

What is so hard to understand about not spending other people’s money?

Former Congressman Alex McMillan with whom I worked for a decade used to say that he thought of every new dollar spent by the federal government as if it came from the pocket of a hard-working person to whom $1 was very important. He was determined not to spend that person’s hard-earned dollar in a frivolous manner not critical to the overall best interest of the nation.

What would the budget look like today if everyone thought the same way? Would we spend taxpayer money on expensive pork-barrel projects such as the Railroad Museum in Strasburg, Pennsylvania?

Or the Bridge to Nowhere in Alaska? How about any superfluous and unnecessary defense program that out-lived its usefulness in the last war?

If you are a liberal and like the idea of more federal welfare and support programs, you have been duped for the past 40 years.

Explosive growth in spending on health care entitlements, Medicaid and Medicare plus the military and veteran health plans have crowded out spending on domestic programs which in 1960 was 68% of the budget.

Today it is less than 32%.

Here’s an indisputable fact: If we hold medical cost inflation to 1-2% per year or below, we could balance the federal budget in the next 5 years with no tax increases and no other cuts in the budget anywhere.

It can be done without sacrificing health care quality outcomes. Small creative entrepreneurial companies are helping several large corporations hold their health care cost growth to 1-2% per year today.

But we need to elect modern-day Coolidges to elective office first. To cut more than red tape.

(budget facts from ‘Coolidge’ by Amity Shlaes 2013)
Picture courtesy of Jarek TuszyƄski / CC-BY-SA-3.0 & GDFL, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=16038266


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Wednesday, September 26, 2018

The Collateral Damage of the Kavanaugh Confirmation Process

Judge Brett Kavanaugh
I run The Institute for the Public Trust.
‘The sole mission of The Institute for the Public Trust is to find, recruit and train the next Thomas Jeffersons, James Madisons, Benjamin Franklins and Alexander Hamiltons for the state of North Carolina and the nation. 
Seldom do we see people of such caliber and talent offer to run for any public office nowadays. They are ‘out there’; they just don’t run for political office anymore for a wide range of reasons. 
The Institute for the Public Trust is committed to changing their minds by teaching them how modern American politics really operates and why they should be part of the solution and not part of the problem by staying on the sidelines.’
Here is the on-going collateral damage of such political machinations we see on traditional and social media every day: A draining of the pool of great people who otherwise might consider using their immense talent to do the basic job of running our self-government at every level.

When is enough ‘enough’ in politics? Character assassination by name-calling has long been a staple of American politics. Teddy Roosevelt called William Howard Taft “a fathead with the brains of a guinea pig”.  John Adams was called “a hideous, hermaphroditical character which has neither the force and firmness of a man, nor the gentleness and sensibility of a woman.”

Name-calling Americans can handle.  But what are the standards of fair play in politics today? Can anyone make an ambiguous legal felony charge against any political figure at any time anywhere?

Every charge of sexual assault is serious. Each one should get immediate attention from law enforcement authorities as soon as it is reported.

Any false accusation is serious as well.

The troubling thing about these last-second accusations from 35+ years ago is that Brett Kavanaugh has been vetted and background-checked 6 different times by the FBI for his previous stints at the White House and as a Judge on the US Court of Appeals over the past 28 years. None of these accusations came up after exhaustive research and investigation.

Had any cases of abuse or harassment been uncovered earlier, Judge Kavanaugh would have been correctly not confirmed to any of these important high-level public service positions. Those were very important public policy and legal jobs no one should have if proven guilty.

Either the FBI has not been doing its job or hundreds of people who have known or worked with Brett Kavanaugh since 1990 have been colossal liars engaged in a massive coordinated conspiracy that concealed a potential dark side for the past 3 decades to protect him for a future Supreme Court nomination.

Members of the 2006 Duke lacrosse team were ‘proven’ guilty by the media, pundits and news commentators before any evidence was presented. Once the evidence was fully presented, the Duke lacrosse players were exonerated and the media was discredited along with DA Mike Nifong who was publicly humiliated and forced to resign his law license.

If unilateral character destruction methods such as this last-second attack on Brett Kavanaugh succeed without evidence or corroboration, no one will be the winner in the end. Every Democrat considering election or appointment to public office will become a sitting duck for exactly the same salacious legal accusations by Republican operatives and hit groups and vice versa.

If the charges against Judge Kavanaugh are proven true, voters should rightly punish the 9 Republican Senators up for re-election at the polls next month for supporting him. If the charges against Judge Kavanaugh are proven specious and untrue, voters should rightly punish the 24 Democratic Senators up for re-election for supporting false testimony against Judge Kavanaugh.

We may never get the next James Madison or George Washington to run for public office if this continues. We may never get anyone to run again.

(first published in North State Journal 9/26/18)



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Wednesday, September 19, 2018

What If Hillary Had Won?


(first published in North State Journal 9/19/18)

Where would we be today?

We would still be languishing in the throes of the economic malaise we endured for 8 long years under President Barack Obama. The same policies that never produced more than 1.9% annual GDP growth for 8 years from 2009-2017.

The question for everyone as we head into the election season this fall is this:

‘Are you economically better off than you were 2 short years ago?’

Had Hillary Clinton been elected President, here’s where we would be today:

  • 1 million more people would be on Medicaid nationwide and 2 million more people would be collecting food stamps because they couldn’t find a job.
  • Enrollment in Temporary Assistance for Needy Families (TANF) would be 12% higher than 2.3 million today.
  • Enrollment in the Supplemental Nutrition Assistance Program (SNAP) would be far higher than 40.7 million reported in January 2018, the lowest since May 2010.
  • The number of people on Social Security Disability Insurance (SSDI) would far higher than 8.6 million in March which was the lowest level reported since February 2012.
  • The Dow Jones Average would be 20,000 today, perhaps 21,000. Not 26,062 as it closed Monday.
  • We would not be experiencing the benefits of 3.5% to possibly 4% real GDP growth rates we are now seeing.
  • Businesses would continue to suffocate under the staggering flood of never-ending new rules and regulations promulgated under President Obama.  Hillary Clinton would have kept all of them in force and expanded them in number; under President Trump, thousands have been rescinded and new regs have been reduced to a dribble.

The election of Donald Trump over Hillary Clinton triggered a massive sense of relief in the business sector and unleashed ‘the animal spirits’ of entrepreneurs nationwide as Adam Smith would have said. The Council of Economic Advisers point towards the demarcation point as being November 8, Election Night 2016. (see chart)

Not one day before.
IF such an explosion of confidence had happened during any of the 8 long years that President Obama was setting policy for our nation, everyone would have known it, recognized it and applauded him for getting the job done.
The explosion of confidence never happened under President Obama. It would not have happened under Hillary Clinton either because she vowed to continue and expand every one of President Obama’s misguided policies.

This new-found confidence in the private sector is working. Friends, neighbors, family members and people everywhere are getting new higher-paying jobs instead of job rejection letters. Millions more of our fellow citizens of all ages and races are working today and providing for their families.

The national Democratic Party wants the public to believe that a sign of government policy success is how many people are on government assistance. They want more socialism which means more government control of your lives, not less.

We believe the reverse is true. The more people are independent and off of government assistance because they have a good job, the better it is for them personally and for the nation as a whole.

Think very carefully about yourself first and your personal economic interests, dreams and desires and those of your children and your friends when you vote this fall.

Do you really want to give the keys back to Congress to the same Democratic leaders who supported every failed economic policy put forth by President Barack Obama?

In 1999, Gallup found a vast majority of Americans thought President Bill Clinton was personally immoral but they liked the fact they personally benefited from the results of the economy that happened under his watch.

You may personally dislike President Trump and the way he does things. But be wary of electing people to Congress and legislatures who want to reverse everything that has worked so far under his term.


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Wednesday, September 12, 2018

"Believe In Something. Even If It Means Sacrificing Everything. #JustSignYourName"

'Hey! If an old guy like me can do it, so can everyone'
(first published in North State Journal 9/12/18)

How odd was it that in the same week Nike introduced its “Believe in something. Even if it means sacrificing everything” #JustDoIt campaign, the vaunted New York Times would publish an ‘anonymous’ op-ed piece about the Trump White House by someone who felt so strongly about its dysfunction…they didn’t sign their name to it.

Does this person not feel strongly enough about the dangers of the Trump White House to sacrifice their own job?

Nike probably won’t sponsor this person. Or will they in absentia?

Is this person old enough to remember the heroism of AG Elliot Richardson and Deputy AG William Ruckelshaus when they resigned instead of bowing to the pressure of President Richard Nixon in 1973 after he demanded they fire Archibald Cox, the special prosecutor investigating Watergate?

Does this person remember that John Hancock signed the Declaration of Independence with 55 other delegates? Benjamin Franklin is attributed as saying after affixing his signature: “We must all hang together, or assuredly we shall all hang separately.”

Had the Founders stayed ‘anonymous’, maybe they could have avoided the gallows noose had they lost The War.

The publication of the anonymous op-ed piece in the New York Times by a ‘senior Trump Administration official’ last week has broken new ground in the annals of journalism.

Who in their right mind would ever publish such an ‘anonymous’ document? How do we know it is even a ‘real’ person who wrote it? What if some junior staff person at CNN drafted it and submitted it to the New York Times editorial board and they published it because they hate President Trump so much that they will do anything to take him down?

After all we have seen in traditional and social media lately, are we 100% sure this is not some planted hit piece purely for political purposes?

At the beginning of the Republic, there were hundreds if not thousands of small newspapers around the 13 colonies. Hardly any of them pretended to be totally objective, totally non-partisan journalistic news outlets.

The more partisan they were, the better were sales of their newspapers. The more incendiary their attacks against the Federalists in power or the Democratic-Republicans who followed later, the more papers they sold to the people who agreed with their point of view.

James Callender was a master of disaster when it came to publishing horrible and totally bogus claims against political opponents of his friends James Madison and Thomas Jefferson. Most of the time, Messrs. Madison and Jefferson funneled the information they wanted Mr. Callender to publish in the first place.

The factual news was secondary to the spreading of their side of the story and their preferred points of political philosophy as it pertained to the new government.

Have we gone back to the future where the venerated Grey Lady of American journalism that has operated under the banner ‘All The News That Is Fit To Print’ for a century has descended into being a mere propaganda arm of the left-wing Progressive movement and ‘The Resistance To President Trump’?

Here’s our policy at the North State Journal: If you are not brave enough to sign your name to an opinion piece, we will never publish it.

We might have taken maybe 1 journalism course in college among our various writers but even we know that publishing such anonymous op-eds is wrong. It is dead-wrong for the country, our body politic and for American journalism.

Men and women of integrity in American politics over time have risen above such cowardly behavior and either challenged powers-that-be publicly and face-to-face or, as we saw in the case of Nixon’s Watergate fiasco, resigned rather than serve under corrupt leadership.

We wish more men and women of integrity on both sides of the aisle would stand up for what is right.

#JustSignYourName


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Wednesday, September 5, 2018

The Old North State Electoral Armistice of 2018

The Treaty of Paris 1783
(first published in North State Journal 9/5/18)

The election process in North Carolina is broken.

More specifically, the process in-between elections is broken. Too many lawyers. Too many lawsuits.
Too many unelected judges inserting themselves into what is constitutionally a legislative issue.

For the past 30 years, North Carolinians have seen what happens when both sides ignore the basic tenet of a theory made famous during the Cold War between the US and the Soviet Union, “MAD” or “Mutual Assured Destruction”:

‘The purpose of MAD is to prevent the use of nuclear weapons in the first place’.

People have unleashed every imaginable legal weapon in North Carolina to challenge every redistricting map and every election since 1982.

It is time to call a truce. Call it ‘The Old North State Armistice’ if you want.

Headlines in recent newspapers have blared out:

“North Carolina's congressional districts unconstitutionally gerrymandered, federal judges say”
“Governor Roy Cooper to legislators: ‘Expect further legal action’ on constitutional amendments”

Can we all agree to get back to the days where legislative districts are drawn by the state legislature and people in those districts can get to know their elected representatives for more than 1 election cycle?

The US Constitution is clear about who has the right to draw congressional and legislative districts after every decennial census: the state legislatures.

The Founders did NOT give that crucial apportionment power to the President; Congress, US Senate, any state governor or any unelected member of the judiciary, including the US Supreme Court.

They could have. But they didn’t. They purposefully gave that critical power to the duly-elected members of each state legislature.

As much as you might abhor Republicans now in power, remember you already have the ultimate ‘impeachment’ tool of any elected official at your disposal:

Biennial Elections.

The Founders realized that times change, people change and young adults grow up with the changing dynamics of life. They realized the best way for a democratic republic such as ours to accommodate such change would be to give voters the ability to change their elected representatives with the most power, Congress and the state legislatures, as often as possible.

Two years is a short period of time to tolerate the abhorrent policies of the opposing party, no matter how bad you might think they are. Many on the right honestly are shocked the country survived 8 years under President Obama.

Take it from someone who toiled in the salt mines of the minority party for over a decade in Congress from 1985-1994.

Being in the minority by 85+ votes stinks, plain and simple. It is degrading; it is depressing and it is painful.

The Republic survived. Somehow.

Being in the minority builds resolve to do whatever it takes to win the next election. Maybe it is organization. Maybe it is fundraising. Maybe it is changing positions on issues that matter to the voting public.

In 1975, there was just 1 GOP senator fighting against 49 Democrats in the state senate and just 9 Rs vs 111 Ds in the NC General Assembly.

Now that was a prime example of extreme partisan gerrymandering given that North Carolina had voted statewide for Republicans Richard Nixon for President in 1968 and 1972 and Governor Jim Holshouser and Senator Jesse Helms in 1972.

In 1994, despite the best efforts of Democrats in 1991 to gerrymander legislative districts nationwide including North Carolina, Republicans scored a massive electoral upset and took control of Congress for the first time since 1954 – 40 long years.

In 2010, despite the best efforts of Democrats for over 100 years to keep Republicans in the deep minority, Republican leaders out-organized, out-raised and out-spent Democrats to take over control of the NCGA, despite the gerrymandering accomplished in 2001 by the Democratic majority.

Biennial elections will work.

Let’s agree to lay our legal swords down and let voters do their constitutional function.


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Wednesday, August 29, 2018

You Might Be A Socialist If...

(first published in North State Journal 8/29/18)

(with apologies to Jeff Foxworthy of ‘You Might Be A Redneck’ fame)

In a recent Gallup poll, 57% of all Democrats said they preferred socialism to capitalism with the highest ratings among liberal young people aged 18-29.

You might ‘think’ you are a socialist at heart. But you probably aren’t.

Take this test and preface each question with ‘I Might Be A Socialist If’ to see if you really do qualify:

  1. I am willing to pay up to 56% of my income to the government every year without looking for loopholes or complaining about it.
  2. I want all major decisions to be made by faceless, unnamed, unelected bureaucrats in Washington, state capitals and local governments.
  3. I want state-run monopolies to control the marketplace.
  4. I want centralized government to monitor my speech and what I can say and when I want to say it or not allow me to talk at all.
  5. I want government to provide massive subsidies and protections to old archaic businesses threatened by new companies and innovations such as Amazon, Apple, PayPal, Uber and Netflix.
  6. I want all of my personal health care decisions to be made by government employees who run medical facilities as well as the government runs the US Postal Service and the state DMV today.
  7. I don’t want any competition to the public education system or allow any alternative means of educating my children, even if the local public school to which we are assigned has been performing poorly for the past 30 years.
  8. I want everyone to be paid the same even though I have worked my tail off and studied and sacrificed when everyone else was playing around and partying.
  9. I want the process to start a new business to take up to 5 years to get through tons of government red tape, regulation and bureaucracy.
  10. I think my personal freedom is less important than everyone else’s needs, wants and desires.

‘Socialism’ where college and health care are ‘free for everyone!’ might be initially attractive to the generation that grew up with Napster and saw everything being offered for free: Facebook, Twitter, Instagram, Pandora, Fortnite.

Except that each business is an extremely capitalistic enterprise that is utterly dependent upon advertising from the private sector to survive.

No profit. No business. The day they stop making a profit, they die.

Chances are very, very high that ‘you might think you are a socialist’ when, in practice, you are very much a freedom-loving American who wants to better yourself and your family through the miracle of free enterprise and capitalism as much as anyone who has ever aspired to get to America legally or illegally in the past.

No one moves to any European country for the promise of their welfare state in retirement if it means restriction of their freedoms to do whatever you want earlier in life.

Close to 50 million legal immigrants live in America today. 15% of the U.S. population legally moved here to participate in the free enterprise system instead of going to socialist nations around the globe.

The US represents 4% of the world’s population of 7.6 billion and yet, 20% of the 250 million international legal migrants worldwide have come here, not Sweden, France and certainly not Venezuela.

You want capitalism. You NEED capitalism. Not only to satisfy your needs and desires such as the next IPhone 10000 but to be able to pay the taxes to pay for the social programs you say you want.

As hard as anyone in America tries to make socialism sound ‘cool’, the truth is that deep down in your heart, you are not a socialist and never will be.

Let Europe stay socialist. Go there if you want to visit. But you will always come back to the freedom of America.


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Wednesday, August 22, 2018

Will This ‘Blue Moon’ Election in North Carolina Turn Into An ‘Eclipse’ For The GOP?

(first published in North State Journal 8/22/18)

What is a ‘blue moon’ election anyway?

A ‘blue moon’ election happens when there is no statewide Presidential, US Senate or gubernatorial campaign at the top of the ballot to drive voter turnout up.

It is called a ‘blue moon’ election because a real blue moon, or a second full moon in one month, happens infrequently about every 2.5 years.

‘Blue moon elections’ are 6 times more rare. They happen every 12 years in North Carolina. The last one was 2006 which was favorable to Democrats. Before that was 1994 which was devastating to Democrats nationally and allowed Republicans to take control of the NCGA for the first time in a century.

If Republicans and conservatives fail to take this upcoming ‘blue moon’ election seriously, 2018 might become ‘The Eclipse Election’.

Of Republicans. Not Democrats.

Care to guess what happens in typical mid-term congressional elections with a US Senate campaign included?

Turnout drops 40%-to-50% from quadrennial presidential campaign years.

During a presidential election, 60%+ of registered voters show up to vote. In 2016, 4,769,640 people or 68% of all registered voters in North Carolina voted.

In a ‘normal’ midterm, perhaps 3 million registered citizens, or 44% of all registered voters, would vote in North Carolina.

There is no US Senate race at the top of the ticket this November.

This is not your ‘typical’ midterm election in North Carolina.

This is a ‘Deep Dark Blue Moon’ election without a lot of attention and enthusiasm. Many North Carolina voters will wake up the day after the November 6 election and say: ‘You mean there was an election yesterday?’

On top of that, 5-6 of the 13 congressional elections in North Carolina involve entrenched incumbents running unopposed or virtually unopposed. That will further depress turnout in those congressional districts which cover 46% of the state population.

We may not have 3 million people show up to vote this fall in North Carolina. It might be far under that number.

Care to guess who wins such low-turnout elections?

The party that can harness the most energy among voters. In most cases, that energy is ‘anger with the status quo’.

In 2016, all anyone had to do was to go to any Donald Trump rally and see 10,000; 15,000; 22,000 people show up from Greenville to Kenansville to see that energy at work. Democrats pooh-poohed it as non-indicative of what would happen on Election Day, only to wake up to see Hillary Clinton go down in defeat.

In 2017-2018, all anyone has had to do was look out an office window on Fayetteville Street in Raleigh and watch 20,000 to 30,000 red-shirted public education teachers march to the legislature to see that energy on the Democrat side this time around.

If you are a Republican or Unaffiliated voter or in business and are generally pleased with Republican control of the NCGA in terms of tax cuts and making North Carolina a more business-friendly state since 2011, and you have enjoyed the tax cuts and deregulation from Washington and the stock market gains since 2016, don’t kid yourself….you can lose everything in this election unless you get as energized as you were in 2016, 2010 and 1994.

There is an absolutely crucial NC Supreme Court race involving incumbent Republican Justice Barbara Jackson that hardly anyone knows about. Republicans are now a 3-4 minority on the Court; if Barbara Jackson is defeated, Republicans will be a 2-5 minority until 2022 at the earliest.

‘Energized’ means giving more money to campaigns this year than you did in 2016.

‘Energized’ means telling all of your employees and friends to vote in this crucial election.

‘Energized’ means not being complacent because politics is never static.

If you don’t get ‘energized’---and real soon---you may witness a political eclipse on November 6.

And the state map will be as blue as the moon.


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Wednesday, August 15, 2018

Abraham Lincoln, The US Flag and The National Anthem


(first published in North State Journal 8/15/18)

“Fellow countrymen:

242 years ago, our fathers brought forth on this continent, a new nation, conceived in Liberty, and dedicated to the proposition that all men are created equal.

Equality guarantees everyone’s freedom to protest in America. Including kneeling for the national anthem and American flag.

Equality also guarantees this: No one has any right or power to make anyone else agree with or listen to them or watch any football game if they choose.

In great contests each party claims to act in accordance with the will of God. Both may be, and one must be, wrong. God cannot be for and against the same thing at the same time.

Such was the case with the Civil War. 2,672,341 Union soldiers fought under the 35-star American Flag during the Civil War. The vast majority were white men from the North who had never seen or met a black person in their life before the War.

642,427 of those Union soldiers suffered casualties during the War. There may not be another prior instance in history where a war was fought and slaves of another race or nationality were freed and not re-enslaved by the victors.

Let us not ever forget these brave men who consecrated the rebirth of freedom for which they gave the last full measure of devotion.

1,227,890 Rebel soldiers fought under the Confederate Flag. They lost. They and 3 million other white Southerners lost everything; land, possessions, political power, slavery; you name it, they lost it.

The Union flag prevailed. The Rebel flag didn’t. If for no other reason, that should be cause for the utmost respect every time the American flag is unfurled and the national anthem is played.

If you want to kneel before flags that represent past injustice, kneel before the English, Portuguese or French flags. They were the largest slave traders for centuries before and after America was colonized.

From beyond the grave, I have witnessed hundreds of millions of people being freed from oppression and dictatorship the world over by men and women serving under the American Flag.

16.1 million American soldiers served in World War II under the 48-star flag to defeat the German Nazis and the Japanese to protect and preserve the very freedoms used today.

There may be good reason to protest specific police departments for excessive use of force against minorities. Protest in front of each one. Start and pay for schools such as the one Lebron James started in Akron to help young children from impoverished neighborhoods get a great education and escape the cycle of poverty.

Run for public office and set policy for local law enforcement to deal with the tough issues they face every day. Serving in public office is a high form of patriotism as well.

It can never be explained while kneeling during the national anthem that ‘no disrespect is intended’ towards millions of fellow Americans who have served in the military.

The American flag and anthem are very important to them whether a protester likes it or not.

Slavery and racism have been a cancer on the soul of humanity everywhere since time immemorial.

From where I sit today, the most amazing thing about America is not how far we need to go for full equality but how far we have come from the beginning of our Republic.

Fondly do we hope, fervently do we pray, that Martin Luther King’s dream will soon come true:
“(Our) children will one day live in a nation where they will not be judged by the color of their skin, but by the content of their character”.
It is for the living to be dedicated to the unfinished work which they who fought before have thus far so nobly advanced. It is for all Americans to be dedicated to the great task remaining’.



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Wednesday, August 8, 2018

Dealing With The Whole Ball of Wax in Health Care

The Whole Ball of Wax
(first published in North State Journal 8/8/18)

The Mercatus Center published a working paper by Charles Blahous last week on the ‘Medicare For All’ (M4A) bill sponsored by Senator Bernie Sanders.

Every Bernie follower in the modern Socialist Democratic Party (SDP) ran to the media microphones to fairly shout: ‘M4A will save $2 trillion over 10 years! That is proof that single-payer health care coverage in America would work!’

Direct quote from the report:
“It is likely that the actual cost of M4A would be substantially greater than these estimates, which assume significant administrative and drug cost savings under the plan, and also assume that healthcare providers operating under M4A will be reimbursed at rates more than 40 percent lower than those currently paid by private health insurance.”
In other words: ‘You have to believe in both the Tooth Fairy AND Santa Claus before you can say M4A will not bankrupt America!’

There is no way on God’s green earth that every physician and hospital administrator will sit back idly and willingly accept a 40% reduction in payments from all private health insurance plans which cover 180 million Americans today.

Bernie Sanders has never seen a sea of white coat physicians swarming Congress like he would see if M4A came close to passage.

The report also clearly states that federal spending would go UP between $32.6 trillion to $38 trillion dollars over 10 years under M4A.  Bernie Sanders and his band of merry socialists could double everyone’s income and payroll taxes and that still wouldn’t be enough to pay for that massive increase.

Does anyone seriously believe that taxpayers would tolerate their taxes being more than doubled, on the distant hope of total health spending may have a snowball’s chance in Hades of going down by 3-4% over a decade?

If we are going to think anew about health care in America, let’s think about the ‘whole ball of wax’ in another way:

We are currently spending $3.868 trillion in direct and indirect payments, government and private, on health care in America, roughly 19% of GDP.

In 1960, it was 5% of GDP.

Why not take all current resources and find a way to divvy it all up according to need and income and then have everyone buy at least the most basic insurance they need to protect against a medical catastrophe that would wipe out their life’s savings in 1 week if it happened to them or their family?

What is ‘insurance’ anyway?

You buy home insurance to insure against the loss of your home due to fire. You don’t buy insurance that sends a crew to clean out your gutters every month.

You buy car insurance to insure against the total loss of your car in an accident or by theft. You don’t buy insurance to change your oil every 3000 miles.

Same with health care. We shouldn’t have to buy insurance to fix every hangnail we get during the course of our lives. We need insurance to pay for the enormous costs of cancer surgery and treatment or long-term nursing care due to a head trauma accident. That should be mandatory; other private plans can be offered for intermediate services and elective procedures.

We currently spend more than enough on health care in America, more per capita than any other
country on earth. We could cut the costs of The Whole Ball of Wax of Health Care by half if everyone tomorrow stopped smoking; stopped over-drinking and over-eating; walked vigorously 30 minutes every day and lost 15% of current body weight.

Which seems to be as likely to happen as Bernie Sanders getting his M4A bill passed. Still, if you want to stick it to the big bad insurance companies or medical profession, get healthy.

You will be glad you did. In many ways.


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Wednesday, August 1, 2018

2% Real GDP Growth Rates Are NOT The New Normal


(first published in North State Journal 8/1/18)

Remember the familiar lament from President Obama’s team for 8 long years?

‘2% real GDP growth is the new normal for the US economy’.

2% annual growth wasn’t even the ‘new normal’ under President Obama.

1.64% was. Pitifully and sadly so.

Their lamentations hearkened back to former President Jimmy Carter’s depressing ‘malaise’ speech of July 15, 1979:
‘It is a crisis of confidence. It is a crisis that strikes at the very heart and soul and spirit of our national will. We can see this crisis in the growing doubt about the meaning of our own lives and in the loss of a unity of purpose for our nation. The erosion of our confidence in the future is threatening to destroy the social and the political fabric of America.’
The ‘crisis of confidence’ Americans had from 1977-1981 was not in their own ability to perform.

Their ‘crisis of confidence’ was in President Jimmy Carter and his ability to lead.

The same can be said now about President Obama. His economic and foreign policy records will be linked with President Carter’s forever.

The above chart tracks the US economy on a seasonally-adjusted basis from the last year of the Bush 43 Presidency through 8 years of President Obama to 18 months under President Trump.

Seasonally-adjusted GDP growth rates actually make the first two years under President Obama look somewhat more favorable even though they were the worst two years economically since 1981-82 and before that, the Great Depression Decade of the 1930s.

No one in their right mind faults President Obama for the desultory real GDP growth rates in 2009 and 2010. The real estate crash nationwide and the failure of our banking and financial institutions plus the resulting job layoffs and business bankruptcies were the result of economic and fiscal polices that were years and decades in the making.

However, President Obama and his economic team had 6 more years to pass policies that would ignite the competitive economic spirit of America.

They failed to do it. Ever.

They concentrated their focus on managing everything with bureaucrats from Washington which crushed the free-wheeling spirit out of American business for the remainder of his term.

For whatever reason, be it Obamacare in 2010 that cast a very heavy blanket of regulations and taxes on US businesses or the avalanche of regulations the Obama Administration layered on American business, real GDP growth rates never exceeded 3% for any year of his presidency for the first time in modern American history.

Real GDP growth under President Obama averaged 1.9% annually for his presidency. If you take out the first 2 years and give Obama the benefit of the doubt since 2009-2010 clearly was a result of previous economic policies and mistakes and give him some credit for the 2017 growth rates even though a lot can be attributed to President Trump’s election, average real GDP growth on a seasonally-adjusted basis under Obama was only 1.64% annually from 2011-2017.

Businessmen and women today exude optimism and enthusiasm when they talk about their economic prospects and plans for expansion, increased sales and hiring more people.

Is it the tax cuts passed last December? Is it the rescission of hundreds if not thousands of federal regulations that were strangling economic growth? Is it the prospect of not having to worry about more taxes or regulations until 2020 at least and maybe 2025?

It may be all of these. It may be the fact that American businesses, workers and investors know that the Obama years are finally over and they can operate in a new business environment where they can work hard and keep more of what they earn and not pay more of it to the government.

Economic growth is contagious.

Maybe annual 3%+ real GDP growth rates are ‘the new normal’ today.

Again.





































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Wednesday, July 25, 2018

What Has Happened To The Modern Democrat Party?

'Waddya mean we are not welcome to any Jefferson-Jackson
Democrat Party fundraiser anymore in America?'
(first published in North State Journal 7/25/18)

Much has been written about the Tea Party and the right-wing fundamentalist Christian influence on the Republican Party over the years.

Editorial writers seem to believe the more they write about ‘how dysfunctional’ the GOP is, the faster it will be driven into oblivion.

The last time the Republican Party held this many elected legislative seats nationwide in the US Senate, Congress and state legislatures and had occupants in the White House and 66% of the Governor Mansions was a century ago in the 1920’s.

Which brings to mind Mark Twain’s quip when informed that American newspapers were erroneously reporting he had died in London: “Reports of my death are grossly exaggerated.”

What about the Democrat Party? What has happened to them over the years?

If you had told a young Republican growing up in North Carolina in the 1960s and 70s that one day in their lifetime, Republicans would dominate the national and state landscape, they would have thought you were completely delusional.

Democrats controlled every possible lever of government from the Governor’s Mansion to dogcatcher across the state east of Morganton.  Democrats in North Carolina at the time tended to be fiscally responsible folks for the most part who balanced budgets with spending restraint first and resorting to tax hikes as a last resort, not the first option; supporters of free enterprise; advocates for a strong national defense; and fiercely anti-communist.

After filibustering the Civil Rights Act of 1964, Southern Democrats later supported civil liberties and a more active government stance as part of their coalition with northern liberals to control Congress for the next 30 years.

What has happened since then?

In 1985, there were 91 Southern Democrats in Congress. ‘Blue Dogs’ as they were known.

They typically voted with Republicans on economic, tax and defense-related issues. Which is why so much of the Reagan Revolution happened in the first place. They bucked the northern liberal leaders of their party on a regular basis to vote for common-sense legislation.

There are 8 Southern Blue Dog Democrats in Congress today. 4% of the Democratic Caucus.
4% does not constitute a majority. None of them are full committee chairs or in leadership positions in the Democrat Party in Congress.

Today’s national Democrat Party touts their ‘new and bold leadership for the future!’ as 76-year old, self-avowed-and-proud-of -it ‘Socialist’ Bernie Sanders, 69-year old Elizabeth Warren, and 28-year old completely socialist congressional candidate Alexandria Ocasio-Cortez of Queens, New York.

Here’s what the leaders of the Democratic Party want to do today:
  • ·       No Borders!
  • ·       No ICE!
  • ·       Repeal Everyone’s Tax Cuts!
  • ·       Free Higher Education!
  • ·       Medicare for Everyone!
  • ·       Capitalism is Terrible!
  • ·       Socialism is Great!

What in the name of Andrew Jackson, Franklin Delano Roosevelt, JFK and even Bill Clinton is going on with the modern Democrat Party?

The lack of vociferous opposition from any moderate Democrat about the direction of their national party is deafening. No Democrat voted for the tax cuts.  All of them will vote for Nancy Pelosi to be Speaker if Democrats win Congress in November which means the socialist democrat agenda will be advanced, not the moderate Southern Democrat agenda.

Southern Democrats and Republicans disagreed on a few issues in the past but they voted together on the big issues for the good of the country such as job creation, the economy and national defense and security.

The Republican Party has its own internal issues to deal with. At least the GOP is heading towards more freedom and free enterprise. Not towards a socialist state.

Dozens of long-term Democrat political operatives in North Carolina have told me they have switched to Unaffiliated because of the leftward shift of the party.

Stay in the Socialist Democrat Party if you want. Or join 2,184,175 other North Carolinians who registered as Unaffiliated, the second largest affiliation in the state.

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Wednesday, July 18, 2018

A Man Walks Into A Socialist Restaurant In Maine...

'I am pretty sure we didn't
fight the Civil War to save
America for socialism'
'No, we didn't, Mr. President.
No we didn't'



(first published in North State Journal 7/18/18)

While in Maine recently, we marveled at the beauty of the coastline, the bustling small towns and harbors and the majesty of Acadia National Park.

We also saw tons of portraits and lithographs of General US Grant and family on walls of shops and homes. Second was President Abraham Lincoln.

It was Maine. Not the South.

We went to a highly-recommended restaurant that featured organic, locally-sourced vegetables; fresh caught fish right from the dock boat and ‘the best hamburger ever made’ because of the high-quality meat served under summer tomatoes and lettuce.

Maybe it was a play on being the ‘social’ place to go in town but staff prominently displayed black t-shirts that read: “The ‘social-(ist)’ place to be in town.”

After being talked out of asking a lot of questions by my family, an internal discussion took place in my head with the waitress that went something like this:

“Soooo, is this really a ‘socialist’ restaurant?”

“Well, it is Maine. We love Bernie and Elizabeth and now Alexandria, ya know.”

“Ok, then. I’ll have this great burger everyone is talking about. Socialists want free college education and health care for everyone so I assume it is free as well, yes?”

“It is $17.99, sir”.

“Wow. I can get a Big Mac for $3.99. Why doesn’t your burger cost the same as a Big Mac?”

“Ours is better sir. Better ingredients, more healthy for you. The beef comes from cattle that are fed the highest-quality grass and heirloom corn their entire lives.”

“But I thought socialists thought everyone should be treated the same. Your burger should cost the same as a Big Mac, yes?”

“Can I get you a drink, sir?

“Are you paid the same as the person who owns this place? Does the proletariat staff share the profits equally on a pro-rata basis?”

“We work for the owner. She is a well-respected and award-winning chef here in Mid-coast Maine.”

“So I guess she took all the risks in buying this place, borrowing money, putting in new ovens and equipment and hiring the staff and filing the tax forms and got all the licenses needed to run a restaurant?”

‘Well, yes, I guess she did.”

“At $17.99/burger, y’all must be making a lot of profit, yes?”

“I guess so. I just started work here a coupla months ago.”

“Even though you have no money in this business, do you get an equal share of the profits? Do you get to go to the same place as the owner does in the winter when it gets brutally cold up here?”

“I think I heard she has a place in Turks and Caicos or somewhere like that.”

“If this place goes bust because someone gets salmonella poisoning from some organic lettuce that has not been properly cleaned before serving, will the banks that lent the money to start the business just write off the debt and forgive the debt entirely without taking any action to recover their money by putting liens on the owner’s home or other assets?”

“I really don’t know sir.”

“Should I tip you or not? I mean, after all, why should I reward any excellence on your part if it will be seen as ‘unfair’ to any of your colleagues?”

“I really don’t know what you are talking about, mister.”

‘This really isn’t a ‘socialist’ restaurant then, is it, ma’am? Socialism draws its energy from capitalism. A risk-taking entrepreneur with vision and talent starts a business to make profits to pay the bills and survive. No profits; no way to pay your wages, therefore, no job for you and no money for anyone else through social programs.”

“I guess so. I just work here, ya know”.

“Y’all Mainers know Grant and Lincoln were Republicans, don’t you?”

“Thanks for coming, sir. Have a nice trip.”


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Wednesday, July 11, 2018

Debunking The Myths of Social Security

You get to choose: understand the facts behind
Social Security or believe in the myths of SS
(first published in North State Journal, 7/11/18)

Myth #1: Social Security is not an entitlement.
 

Social Security is not only an entitlement program, it is the largest and most prototypical federal entitlement program.  Virtually any credible glossary of federal budget terminology will point to Social Security as the leading example of an entitlement (specifically, an entitlement is a program in which payments are obligated to beneficiaries according to eligibility criteria set in law, without requiring annual legislation to appropriate funds).

Myth #2: Social Security wouldn’t be in financial trouble if politicians hadn’t stolen and spent its money.

Social Security trust fund reserves are by law invested in US Treasury securities, which finance federal government spending.  But this phenomenon has nothing do with Social Security’s shortfall.  Social Security still owns all that money and earns interest on it.  Whenever Social Security tax revenues fall short of its benefit obligations, as they have since 2010, Social Security taps both interest and principal of its trust funds to pay benefits.  Social Security’s shortfall exists despite the government’s repaying those funds to Social Security, not because it won’t.

Myth #3: Participants have paid for their benefits. 

Workers covered by Social Security contribute payroll taxes, which establish an entitlement to benefits for themselves and certain dependents.  However, this does not mean they have paid for the full amount of their scheduled benefits.  Social Security has a shortfall precisely because in the aggregate, workers have not paid for their benefits: total scheduled benefits well exceed what workers’ tax contributions, plus interest, can finance.

Myth #4: Social Security is solvent until the 2030s, so there is still plenty of time to fix it. 

How soon Social Security’s trust funds run out, and how soon we must act, are two entirely different things.  By the time its trust funds are depleted, annual income and costs will be so far apart that there is no realistic chance of legislation closing the shortfall.  The window of opportunity for correction is closing now, if it hasn’t closed already.

Myth #5: Because Social Security is self-financing, it doesn’t add to the federal budget deficit. 

Since 2010, as Social Security’s costs have exceeded its tax revenue, the federal government has been running larger deficits to fund the payments it owes to Social Security. The fact that the federal budget benefited from Social Security surpluses in the past doesn’t make its ongoing deficit-worsening outlays, during the years it pays Social Security back, any less real.

Myth #6: Taxing rich people more by raising the cap on taxable wages will fix the problem. 

There’s a statutory cap on each worker’s annual earnings subject to Social Security taxes -- $128,400 this year and indexed to grow automatically in most years.  Raising the taxable maximum from today’s level all the way to about $350,000 in 2022 would only eliminate about 14% of the structural deficit, in part because a worker’s benefits are linked to his tax contributions and thus the tax increase would generate higher benefits for the well-off.  That cost increase could be prevented by changing the benefit formula on the high-income end; but without benefit changes, a tax cap increase by itself doesn’t accomplish very much.

Myth #7: Social Security privatization is a live option. 

Many years ago when Social Security was running surpluses, presidents such as Bill Clinton and George W. Bush suggested that workers be given the option of saving them in personal accounts. 

None of those proposals involved privatization, but instead would have allowed for individual saving within a publicly administered system. That opportunity vanished in 2010 when Social Security began running cash deficits.  Since then there have been no surplus Social Security contributions to save, and every program tax dollar collected now goes out the door to pay current benefits.

Despite the fact that this has long been a dead issue, occasional “privatization” fear-mongering continues.
===Written by Charles Blahous

Charles Blahous is the J. Fish and Lillian F. Smith chair and senior research strategist at the Mercatus Center, a visiting fellow with the Hoover Institution, and a contributor to E21. He recently served as a public trustee for Social Security and Medicare. This article was originally published on economics21.org.








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