WSJ.com - Mischief in Minnesota?

WSJ.com - Opinion: Mischief in Minnesota?

 

When Minnesotans woke up last Wednesday, Republican Senator Norm Coleman led Mr. Franken by 725 votes. By that evening, he was ahead by only 477. As of yesterday, Mr. Coleman's margin stood at 206. This lopsided bleeding of Republican votes is passing strange considering that the official recount hasn't even begun. 

In a normal audit, these mistakes could be expected to cut both ways. Instead, nearly every "fix" has gone for Mr. Franken, in some cases under strange circumstances.

If Minnesota wants to retain its reputation as a state with clean elections, it needs to run an honest recount.

WSJ.com - Nationalizing Detroit

WSJ.com - Opinion: Nationalizing Detroit

 

In the Washington mind, there are two kinds of private companies. There are successful if "greedy" corporations, which can always afford to pay more taxes and tolerate more regulation. And then there are the corporate supplicants that need a handout. 

 

 For decades, Congress has never had a second thought as it imposed tighter emissions standards on GM, Ford and Chrysler, denouncing them for making evil SUVs. Yet now that the companies are bleeding cash, and may be heading for bankruptcy, suddenly the shrinking Big Three are the latest candidates for a taxpayer bailout. 

The financial panic has hit Detroit hard, but its problems go back decades and are far deeper than reduced access to credit among car buyers.  

A bailout might avoid any near-term bankruptcy filing, but it won't address Detroit's fundamental problems of making cars that Americans won't buy and labor contracts that are too rich and inflexible to make them competitive...  While GM has spent billions of dollars on labor buyouts in recent years, they are still forced by federal mileage standards to churn out small cars that make little or no profit at plants organized by the United Auto Workers.

Rest assured that the politicians don't want to do a thing about those labor contracts or mileage standards.

WSJ.com - Five Myths About the Great Depression

WSJ.com - Opinion: Five Myths About the Great Depression

 

The current financial crisis has revived powerful misconceptions about the Great Depression. Those who misinterpret the past are all too likely to repeat the exact same mistakes that made the Great Depression so deep and devastating. ...it is essential that the decisions of the coming months are shaped by the right lessons -- not the myths -- of the Great Depression.

Here are five interrelated and durable myths about the 1929-39 Depression:

- Herbert Hoover, elected president in 1928, was a doctrinaire, laissez-faire, look-the-other way Republican who clung to the idea that markets were basically self-correcting. The truth is more illuminating...

- The stock market crash in October 1929 precipitated the Great Depression. What the crash mainly precipitated was a raft of wrongheaded policies that did major damage to the economy...

- Where the market had failed, the government stepped in to protect ordinary people.   Following in Hoover's footsteps, FDR concentrated on trying to raise farm income by such tactics as setting quotas on production and paying farmers to remove acreage from production -- even though this meant higher prices for hard-pressed consumers and had the effect of both lowering productivity and driving farmers off their land.

- Greed caused the stock market to overshoot and then crash. The real culprit here -- as in the housing bubble in our own time -- is... a speculative fever induced by excessively easy credit and broken by the inevitable return to more realistic valuations...

- Enlightened government pulled the nation out of the worst downturn in its history and came to the rescue of capitalism through rigorous regulation and government oversight. To the contrary, the Hoover and Roosevelt administrations -- in disregarding market signals at every turn -- were jointly responsible for turning a panic into the worst depression of modern times...

WSJ.com - Guantanamo Revelation

WSJ.com - Opinion: Guantanamo Revelation

 

According to the six-year narrative of the press and political class, the Bush Administration's counterterrorism policies fall somewhere between the Spanish Inquisition and the Ministry of Love in "1984." So it was something of a shock to read a remarkable front-page story in the New York Times yesterday, the abridged version being: Never mind.

In their 1,600-word dispatch "Next President Will Face Test on Detainees," reporters William Glaberson and Margot Williams discover that, gee whiz, many of the prisoners at Guantanamo Bay really are dangerous terrorists.  

As we learned under FDR (internment camps), LBJ (spying on political enemies) and Bill Clinton (rendition to Arab regimes), liberals aren't as punctilious about civil liberties when liberals run the government.  

WSJ.com - Argentina Impoverishes Itself Again

WSJ.com - Opinion: Argentina Impoverishes Itself Again

 

What happens when government meddles with private wealth.

Argentina is a constitutional republic with many historical similarities to the U.S. It has a rich immigrant heritage and an abundance of natural resources. But the U.S. is a rich, advanced country and Argentina is poor.

How did the breadbasket of South America fall so far behind? One explanation goes back some 90 years, when the Argentine Supreme Court began chipping away at property rights as a way of addressing economic inequality. Argentine politicians quickly learned that lawful plunder was their path to power.

This history is still being written, and the latest chapter ought to frighten Americans.

WSJ.com - Most Presidents Ignore the Constitution

WSJ.com - Opinion: Most Presidents Ignore the Constitution

 

The government we have today is something the Founders could never have imagined. 

When Franklin Delano Roosevelt first proposed legislation that authorized the secretary of agriculture to engage in Soviet-style central planning -- a program so rigid that it regulated how much wheat a homeowner could grow for his own family's consumption -- he rejected arguments of unconstitutionality. He proclaimed that the Constitution was "quaint" and written in the "horse and buggy era," and predicted the public and the courts would agree with him.

Remember that FDR had taken -- and either Mr. Obama or Mr. McCain will soon take -- the oath to uphold that old-fashioned document, the one from which all presidential powers come.

Unfortunately, these presidential attitudes about the Constitution are par for the course. Beginning with John Adams, and proceeding to Abraham Lincoln, Woodrow Wilson and George W. Bush, Congress has enacted and the president has signed laws that criminalized political speech, suspended habeas corpus, compelled support for war, forbade freedom of contract, allowed the government to spy on Americans without a search warrant, and used taxpayer dollars to shore up failing private banks.

All of this legislation -- merely tips of an unconstitutional Big Government iceberg -- is so obviously in conflict with the plain words of the Constitution that one wonders how Congress gets away with it.

WSJ.com - The True Meaning of 'Historic Vote'

WSJ.com - Opinion: The True Meaning of 'Historic Vote'

 

Shifting America's animating idea from creation to protection. 

 

The real "change" being put to a vote for the American people in 2008 is not simply a break from the economic policies of "the past eight years" but with the American economic philosophy of the past 200 years. This election is about a long-term change in America's idea of itself.  ...the U.S. is at a philosophical tipping point.

 

In the aftermath of the financial crisis, prominent Democrats, European leaders in France and Germany and more U.S. newspaper articles than one can count have said that the crisis proves the need to permanently tame the American "free-market" model... The question is: Are the American people of a mind to throw in the towel on the system that got them here? 

 

[The Obama proposals] would transform the animating American idea -- away from creation and toward protection.

Many voters -- progressive Democrats, the asset-safe rich, academics and college students -- regard this as where America should go. They explicitly want America's great natural energies transferred away from unwieldy economic competition and toward social construction.  

An archive of my past WSJ.com articles can be found here: http://wsj-articles.blogspot.com/

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WSJ.com - Don't Let the Polls Affect Your Vote

WSJ.com - Opinion: Don't Let the Polls Affect Your Vote

 

They were wrong in 2000 and 2004. 

 

Polls can reveal underlying or emerging trends and help campaigns decide where to focus. The danger is that commentators use them to declare a race over before the votes are in. This can demoralize the underdog's supporters, depressing turnout. 

 

In truth, however, no one knows for sure what kind of polling deficit is insurmountable or even which poll is correct. All of us should act with the proper understanding that nothing is yet decided. 

WSJ.com - Almost Everyone Would Do Better Under the McCain Health Plan

WSJ.com - Opinion: Almost Everyone Would Do Better Under the McCain Health Plan

His tax credit is larger than the current tax subsidy for insurance.

The McCain health-care insurance tax credit may well be one of the most misunderstood proposals of this presidential election. Barack Obama has been ruthless in his attacks. But the tax credit is highly progressive and will provide a powerful incentive for people to purchase health insurance. These features under normal circumstances should endear Democrats to the proposal.

Consider the current exclusion. Its value rises with how much someone spends on health care, and how much of this spending is funneled through employer-sponsored health-care coverage. This creates an incentive for people to purchase policies with low deductibles, or which cover routine spending. These policies look a lot less like insurance and more like prefunded spending accounts purchased through employers and managed by insurance companies. Consider homeowners and auto insurance policies. Do these cover routine spending on cleaning the gutters or tuning up a car?

The subsidy encourages people to buy bigger policies that cover more, and leads to greater health-care spending. Moreover, lower deductibles and coverage of routine spending dulls consumers' sensitivity to price. Reducing the tax bias should result in insurance that is more focused on catastrophic coverage and less on routine spending.

WSJ.com - The Age of Prosperity Is Over

WSJ.com - Opinion: The Age of Prosperity Is Over

Financial panics, if left alone, rarely cause much damage to the real economy, output, employment or production. Asset values fall sharply and wipe out those who borrowed and lent too much, thereby redistributing wealth from the foolish to the prudent.

When markets are free, asset values are supposed to go up and down, and competition opens up opportunities for profits and losses. Profits and stock appreciation are not rights, but rewards for insight mixed with a willingness to take risk... Good decisions should be rewarded and bad decisions should be punished. The market does just that with its profits and losses.

No one likes to see people lose their homes when housing prices fall and they can't afford to pay their mortgages; nor does any one of us enjoy watching banks go belly-up for making subprime loans without enough equity. But the taxpayers had nothing to do with either side of the mortgage transaction...

Giving more money to people when they fail and taking more money away from people when they work doesn't increase work. And the stock market knows it.

These issues aren't Republican or Democrat, left or right, liberal or conservative. They are simply economics, and wish as you might, bad economics will sink any economy no matter how much they believe this time things are different. They aren't.

WSJ.com - Hatin' Palin

WSJ.com - Opinion: Hatin' Palin

The complaint against the Alaska governor, at its most basic, is that she doesn't qualify for admission to the national political fraternity. Boy, that's rich. Behold the shabby frat house that says it's above her pay grade.

Congress has the lowest approval rating ever registered in the history of polling (12%!). She isn't the reason polls are showing people want the entire Congress fired, with many telling pollsters they themselves could do a better job.

The primary discomfort with Gov. Palin is the notion that she doesn't have sufficient experience to be president, that Sen. McCain should have picked a Washington hand seasoned in the ways of the world. Such as? Here's an opinion poll question:

If as Joe Biden suggests the U.S. is likely to be tested by a foreign enemy next year, who of the following would you rather have dealing with it in the Oval Office: Nancy (of Damascus) Pelosi, Harry Reid, John Edwards, Joe (the U.S. drove Hezbollah out of Lebanon) Biden, Mike Huckabee, Geraldine Ferraro, Tom DeLay, Jimmy Carter or Sarah Palin?

My pick? Gov. Palin, surely the most grounded, common-sense person on that list of prime-time politicians.

WSJ.com - Big Labor Does Gay Marriage

WSJ.com - Opinion: Big Labor Does Gay Marriage

Here's a pop quiz: Who's donated the most money to an effort in California to defeat Proposition 8, an initiative on the November 4 ballot that would define marriage as between a man and a woman in the state?

A) Gay-advocacy organizations

B) Civil-rights groups

C) The California Teachers Association

If you guessed "C," you understand the nature of modern liberal politics. And if you didn't, perhaps you're wondering what exactly gay marriage has to do with K-12 public education.

Public school teachers of America, take note. This is your dues money at work.

WSJ.com - How to Read the Constitution

WSJ.com - Opinion: How to Read the Constitution  (an excerpt from Supreme Court Justice Clarence Thomas)

 

What is the role of government? Or more to the point, what is the role of our government?

The Declaration of Independence sets out the basic underlying principle of our Constitution. "We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the pursuit of Happiness. -- That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed . . . ."

The framers structured the Constitution to assure that our national government be by the consent of the people. To do this, they limited its powers. The national government was to be strong enough to protect us from each other and from foreign enemies, but not so strong as to tyrannize us. So, the framers structured the Constitution to limit the powers of the national government. Its powers were specifically enumerated; it was divided into three co-equal branches; and the powers not given to the national government remained with the states and the people...

Since Marbury v. Madison the federal judiciary has assumed the role of the interpreter and, now, final arbiter of our Constitution. But, what rules must judges follow in doing so? What informs, guides and limits our interpretation of the admittedly broad provisions of the Constitution? And, more directly, what restrains us from imposing our personal views and policy preferences on our fellow citizens under the guise of Constitutional interpretation?

...there are really only two ways to interpret the Constitution -- try to discern as best we can what the framers intended or make it up. No matter how ingenious, imaginative or artfully put, unless interpretive methodologies are tied to the original intent of the framers, they have no more basis in the Constitution than the latest football scores.   

WSJ.com - Get Ready for the New New Deal

WSJ.com - Opinion: Get Ready for the New New Deal

 

Today, the U.S. is in better shape than in 1932. But it faces similar circumstances. The stock market has been in a tail spin, credit markets have locked up, and a surging Democratic presidential candidate is running on expanding the role of government, laying the blame for the economic turmoil on the current occupant of the White House and his party's economic policies.

 

 Democrats draw their political power from trial lawyers, unions, government bureaucrats, environmentalists, and, perhaps, my liberal colleagues in academia. All of these voting blocs seem to favor a larger, more intrusive government. If things proceed as they now appear likely to, we can expect major changes in policies that benefit these groups.

If those of us who favor free markets for the freedom and prosperity they bring are right, the political system may soon put our economy on track for a catastrophe.

WSJ.com - We Don't Need Anyone to Run the World

WSJ.com - Opinion: We Don't Need Anyone to Run the World 

John Stossel Gets It! 

 

Most of life works by spontaneous order. It characterizes how we choose our jobs, hobbies, associates, recreation, etc. When politicians try to regulate the process, they usually make life worse. 

 

But pundits have no clue about spontaneous order. Instead, they talk about who will "run America."

This faith in political solutions thrives in the face of repeated government failure. Big farm bills have raised the price of food and squeezed out small farms. Campaign finance reform made it harder to challenge incumbents. FEMA couldn't deliver water to hurricane-ravaged New Orleans as well as Wal-Mart did. Medicare has a $35 trillion unfunded liability over the next 75 years.

Yet the media and political class call for more government control.  

[Note: The TV special this article refers to "John Stossel's Politically Incorrect Guide to Politics," aired last week, and can be watched online here: http://abcnews.go.com/2020]

WSJ.com - A Liberal Supermajority

WSJ.com - Opinion: A Liberal Supermajority

 

Get ready for 'change' we haven't seen since 1965, or 1933. 

 

If the current polls hold, Barack Obama will win the White House on November 4 and Democrats will consolidate their Congressional majorities, probably with a filibuster-proof Senate or very close to it. Without the ability to filibuster, the Senate would become like the House, able to pass whatever the majority wants. 

Though we doubt most Americans realize it, this would be one of the most profound political and ideological shifts in U.S. history. Liberals would dominate the entire government in a way they haven't since 1965, or 1933. In other words, the election would mark the restoration of the activist government that fell out of public favor in the 1970s. If the U.S. really is entering a period of unchecked left-wing ascendancy, Americans at least ought to understand what they will be getting, especially with the media cheering it all on.

Americans voting for "change" should know they may get far more than they ever imagined.

WSJ.com - A Capitalist Manifesto

WSJ.com - Opinion: A Capitalist Manifesto

Where are the champions of free-market capitalism? Someone needs to remind us all that two great works were published in 1776, both representing game-changing advances in human freedom: The Declaration of Independence, authored by future American president, Thomas Jefferson, and "The Wealth of Nations" by Scottish economist Adam Smith. Both embrace the social wisdom of individual liberty; both extol the importance of personal responsibility.

France's president held out the possibility that all is not lost, that we can fix what is broken. "The financial crisis is not the crisis of capitalism," according to Mr. Sarkozy. "It is the crisis of a system that has distanced itself from the most fundamental values of capitalism, which betrayed the spirit of capitalism."

It is a distinction that could make all the difference.

WSJ.com - Obama's 95% Illusion

WSJ.com - Opinion: Obama's 95% Illusion

 

One of Barack Obama's most potent campaign claims is that he'll cut taxes for no less than 95% of "working families." He's even promising to cut taxes enough that the government's tax share of GDP will be no more than 18.2% -- which is lower than it is today. 

It's a clever pitch, because it lets him pose as a middle-class tax cutter while disguising that he's also proposing one of the largest tax increases ever on the other 5%. But how does he conjure this miracle, especially since more than a third of all Americans already pay no income taxes at all? There are several sleights of hand, but the most creative is to redefine the meaning of "tax cut."

For the Obama Democrats, a tax cut is no longer letting you keep more of what you earn. In their lexicon, a tax cut includes tens of billions of dollars in government handouts that are disguised by the phrase "tax credit."  

WSJ.com - Obama, McCain, and Health-Care

2 related articles on the candidate's Health-Care proposals:

 

WSJ.com - Opinion: Obama and Health-Care Equity

 

All in all, workers would come out ahead with the McCain plan. According to the left-leaning Tax Policy Center, the average taxpayer would see his tax bill drop by $1,241 in 2009. 

 

Mr. Obama's chief economic adviser agrees with the McCain critique of the current system, or at least he once did. "This massive program of tax breaks is ineffective and regressive, wasting money on those who have health insurance while doing little for those who can barely afford it and nothing at all for those without it,"

On choice, portability, quality and especially equity, the McCain health plan is far superior to Mr. Obama's. The Democrat is merely offering Canada on the installment plan.

 

WSJ.com - Opinion: McCain Is the Real Health-Care Reformer

Mr. McCain recognizes that a large part of the problem is that the tax code favors employer-funded health insurance. The system, which began as a response to FDR's wage and price controls, is built on tax breaks that allow employers to buy health insurance with pretax dollars.

Mr. McCain doesn't want to scrap employer-based insurance. He would keep part of the tax deduction in place. But he wants to fundamentally change the way the system works and instead give the self-employed and individuals a tax break for buying their own insurance. There are several advantages to this approach:

WSJ.com - About That Middle-Class Tax Cut . . .

WSJ.com - Opinion: About That Middle-Class Tax Cut . . .

 

Mr. McCain could do worse than remind the middle class what happened to them the last time a charismatic Democratic candidate promised them a tax cut. While he's at it, he might also remind them how much more expensive it will be to send Barack Obama to the White House at a time when his fellow Democrats will have a majority in both houses of Congress.

 

Back when Mr. Clinton was campaigning for president in 1992, he made a pretty direct pitch: Raise taxes on people making more than $200,000, and use those revenues to fund tax relief for the "forgotten middle class."

 

Mr. Clinton, of course, won that election. And as the inauguration approached, he began backtracking from his promise...

 

WSJ.com - America and the New Financial World

WSJ.com - Opinion: America and the New Financial World

This should not be a partisan argument. It is perfectly fair to argue that wealthy corporations should pay a greater share of the tax base than struggling middle-class Americans. Fair, but not realistic. The U.S. government can no longer dictate to global capital. Once, when the U.S. was the engine of global growth, when the world needed Wall Street for funding, capital could be taxed and controlled by the fiat of the U.S. government. No longer. The U.S. may have the will; it does not have the power.

The current debate in Washington gives no indication that this reality is understood. Both sides of the aisle are susceptible to a false sense of American economic sovereignty. Companies and countries flush with cash increasingly view U.S. laws, regulations and attitudes as undue burdens. As consumer activity accelerates outside the U.S. and Europe, and as financial centers spring up elsewhere, there is increasingly less inclination and less need for the world to go either to Wall Street or to Main Street.

 

WSJ.com - Not Everyone Should Own a Home

WSJ.com - Opinion: Not Everyone Should Own a Home

Maybe only a friendly foreigner could say this. But America needs to realize that not everyone can own a home. The American Dream of home ownership for all is a fraud. Politicians who pimped this dream created an unsustainable mortgage industry whose collapse is only surprising because it didn't happen earlier. America's mortgage industry will not recover, nor deserve to recover, unless it is prepared to challenge this politically unpalatable reality.

America has a long and undistinguished history of populist politicians stacking the cards against lenders and in favor of risky homeownership... If socially laudable but economically reckless laws cause entirely predictable problems for lenders, don't be surprised if taxpayers have to bail them out.

WSJ.com - The Tax Issue Still Resonates

WSJ.com - Opinion: The Tax Issue Still Resonates

Most Americans hold an intuitive belief that one of the most effective ways to keep government in its appropriate place is to limit its access to our wallets. They have a well-grounded, experience-based suspicion that if government can take anything it wants from some (high-income) people, it can, and most likely will, take it from everyone else, too. They are unenthusiastic about massive new spending because they understand tax increases both feed government and whet its appetite for more.

The tax issue has lost its political punch in the eyes of some commentators, but not among voters. So the presidential candidates recognize this year's election could hinge on who better convinces Americans that he has the right plan to cut taxes.

 

WSJ.com - McCain Is Right On Interstate Health Insurance

WSJ.com - Opinion: McCain Is Right On Interstate Health Insurance

A recent kerfuffle between Mr. Obama and Republican presidential candidate John McCain concerned the interstate purchase of health insurance. Mr. McCain wants to allow people to buy health insurance across state lines. Mr. Obama, on the other hand, opposes the idea and seems to believe it would create an unsafe, unregulated health-insurance market.

Mr. McCain backs legislation sponsored by Arizona Rep. John Shadegg. Known as the Health Care Choice Act, it would allow individuals living in one state to purchase health insurance being sold to people living in other states. The policy would still have to meet the regulations of the state in which it is being sold, and would be subject to additional federal oversight.

Creating an interstate option for individuals to purchase health insurance doesn't solve every problem faced by the 45 million Americans who are uninsured. But the choice isn't between a regulated or unregulated health-insurance market. The choice is between an overregulated market favored by Mr. Obama and a regulated market favored by Mr. McCain that provides more options to help individuals afford health coverage. 

 

WSJ.com - Bill v. Barack on Banks

WSJ.com - Opinion: Bill v. Barack on Banks

A running cliché of the political left and the press corps these days is that our current financial problems all flow from Congress's 1999 decision to repeal the Glass-Steagall Act of 1933 that separated commercial and investment banking. Barack Obama has been selling this line every day. Bill Clinton signed that "deregulation" bill into law, and he knows better.

As for the sins of "deregulation" more broadly, this is a political fairy tale. The least regulated of our financial institutions -- hedge funds -- have posed the least systemic risks in the current panic. The big investment banks that got into the most trouble could have made the same mortgage investments before 1999 as they did afterwards. One of their problems was that Lehman Brothers and Bear Stearns weren't diversified enough....

Mr. Obama's "deregulation" trope may be good politics, but it's bad history and is dangerous if he really believes it. The U.S. is going to need a stable, innovative financial system after this panic ends, and we won't get that if Mr. Obama and his media chorus think the answer is to return to Depression-era rules amid global financial competition. Perhaps the Senator should ask the former President for a briefing.