The Most Awesome Country in Existence

Published: Fri, 10/03/14

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The Most Awesome Country in Existence
 
Cato Institute Senior Fellow, Dan Mitchell

The Cato Institute’s Dan Mitchell makes the same case for Switzerland as I have been making for years. And I agree with Dan where he writes he has no plans of giving up his country to the plundering thieves in Washington.

But let’s shift back to the world of public policy. Every time I’m in Switzerland, my admiration for the country increases. Here are five ways Switzerland is better than the United States.

1. The burden of government spending is lower in Switzerland. According to OECD, the public sector consumes only 33.1 percent of economic output in Switzerland, compared to 41.1 percent of GDP in the United States.

2. Switzerland has genuine federalism, with the national government responsible for only about one-third of government spending. The United States used to be like that, but now more than two-thirds of government spending comes from Washington.

3. Because of a belief that individuals have a right to control information about their personal affairs, Switzerland has a strong human rights policy that protects financial privacy. In the United States, the government can look at your bank account and does not even need a search warrant.

4. Switzerland has a positive form of multiculturalism with people living together peacefully notwithstanding different languages and different religions. In the United States, by contrast, the government causes strife and resentment with a system of racial spoils.

5. Gun ownership is pervasive in Switzerland, and the Swiss people value this freedom. Moreover, how can one not admire a nation where all able-bodied males have fully automatic rifles in their homes? To be sure, the United States is very good by world standards in protecting this freedom, so the  Swiss don’t really have an advantage on this issue, but it’s still worth mentioning.

Notwithstanding my admiration for Switzerland, there are five reasons why I don’t plan on expatriating.

1. I’m not rich and don’t particularly see how I will get rich anytime soon. Switzerland is not a cheap place to live.

2. It would be very time-consuming and expensive to go to Georgia Bulldog games, and I doubt the games would be on TV.

3. Speaking of sports, the Swiss share the disturbing European propensity to follow soccer.

4. It’s not warm enough.

5. Even though it’s considered a bit uncouth among some libertarians, I do have certain patriotic impulses. I’m not about to surrender my nation to the plundering thieves from Washington.

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Poor Are Poor because Rich Are Rich?
 

poor taxIn NRO Kevin D. Williamson quotes a “superior economist” who once advised that the our national problem is the “stagnation of real wages and the disappearance of jobs offering middle-class incomes, as well as the constant insecurity that comes with not having reliable jobs or assets.”

That economist is none other than Paul Krugman, whose favorite pastime today seems to be chiding the rich for their conspicuous consumption. But as Mr. Williamson asks, how in the world would making Donald Trump, for example, less rich make anyone else less poor? The very poor are generally poor because they do not have jobs. Yet today, not only is the number of employed in America lower than it was when Barack Obama took office, but household income is also down. “Grover Cleveland is looking like a genius in comparison,” writes Kevin. Read more here:

The inequality police are worried that we are living in a new Gilded Age. We should be so lucky: Between 1880 and 1890, the number of employed Americans increased by more than 13 percent, and wages increased by almost 50 percent. I am going to go out on a limb and predict that the Barack Obama years will not match that record; the number of employed Americans is lower today than it was when he took office, and household income is down. Grover Cleveland is looking like a genius in comparison.

The inequality-based critique of the American economy is a fundamentally dishonest one, for a half a dozen or so reasons at least. Claims that the (wicked, wicked) “1 percent” saw their incomes go up by such and such an amount over the past decade or two ignore the fact that different people compose the 1 percent every year, and that 75 percent of the super-rich households in 1995 were in a lower income group by 2005. “The 3 million highest-paying jobs in America paid a lot more in 2005 than did the 3 million highest-paying jobs in 1995” is a very different and considerably less dramatic claim than “The top 1 percent of earners in 1995 saw their household incomes go up radically by 2005.” But the former claim is true and the latter is not.

Paul Krugman, who persists in Dickensian poverty, barely making ends meet between six-figure sinecures, is a particularly energetic scourge of the rich, and he is worried about conspicuous consumption: “For many of the rich, flaunting is what it’s all about. Living in a 30,000 square foot house isn’t much nicer than living in a 5,000 square foot house; there are, I believe, people who can really appreciate a $350 bottle of wine, but most of the people buying such things wouldn’t notice if you substituted a $20 bottle, or maybe even a Trader Joe’s special.” In an earlier piece on the same theme, he urged higher taxes as a way to help the rich toward virtue: “While chiding the rich for their vulgarity may not be as offensive as lecturing the poor on their moral failings, it’s just as futile. Human nature being what it is, it’s silly to expect humility from a highly privileged elite. So if you think our society needs more humility, you should support policies that would reduce the elite’s privileges.” That is, seize their money before they order the 1982 Margaux.

I live in the same city as Donald Trump, so the existence of rich people with toxic taste is not exactly a Muppet News Flash for me. But poor people are not poor because rich people are rich, nor vice versa. Very poor people are generally poor because they do not have jobs, and taking away Thurston Howell III’s second yacht is not going to secure work for them.  Nobody has ever been able to satisfactorily answer the question for me: How would making Donald Trump less rich make anybody else better off?

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Constant Intervention and War
 

peace through strengthThe Cato Institute’s Doug Bandow paints Hillary Clinton as the poster child for this failed foreign policy strategy. And Doug lumps most of the front running 2016 Republican presidential candidates into the same sinking ship. Rand Paul is, however singled out by Mr.Bandow as an exception. Paul seems to remember and consider Ronald Reagan’s dictum of “peace through strength” with the emphasis on peace.

U.S. foreign policy is a bipartisan fiasco. George W. Bush gave the American people Iraq, the gift that keeps on giving. Barack Obama is a slightly more reluctant warrior, but he is taking the country back into the Mideast.

Hillary Clinton, the unannounced Democratic front-runner for 2016, supported her husband’s misbegotten attempt at nation-building in Kosovo and led the drive for war in Libya, which is violently unraveling. Most of Clinton’s potential GOP opponents share Washington’s bomb, invade and occupy consensus.

The only exception is Sen. Rand Paul, R-Ky. He stands alone advocating a foreign policy which reflects the bitter, bloody lessons of recent years.

The Islamic State of Iraq and Syria is the latest result of Washington’s incessant and counterproductive meddling in the Middle East. Nowhere has U.S. policy been more disastrous.

But the usual suspects are calling for more intervention, more war. This time, they promise, everything will go well.

Read more here.

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America’s Dysfunctional “Slobocracy”
 

secret serviceThe astonishing recent lapse in White House security has some media sources arguing that budget cuts are the underlying cause of the Secret Service’s dysfunction. But as the WSJ points out, the Secret Service budget of $1.7 billion for 2014 has doubled in real terms since 1998.

This past May, Peggy Noonan opined in the WSJ on the on-going disgrace of the Veteran Administration scandal and its impact on how Americans view government under the leadership of Barack Obama.

Barack Obama is killing the reputation of government. He is killing the thing he loves through insufficient oversight. He doesn’t do the plodding, unshowy, unromantic work of making government work. In the old political formulation, he’s a show horse, not a workhorse.

The president’s inattention to management—his laxity, his failure to understand that government isn’t magic, that it must be forced into working, clubbed each day into achieving adequacy, and watched like a hawk—is undercutting what he stands for, the progressive project that says the federal government is the primary answer to the nation’s ills.

He is allowing the federal government to become what any large institution will become unless you stop it: a slobocracy.

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Cato Club 200 Retreat and Report Cards
 

The lyrics “You want to go where everybody knows your name”, from the TV show Cheers gives you a pretty good idea of what it’s like to be part of the Cato Club 200 retreat.

“Lucky us!” is how Becky and I felt as we spent the weekend with friends, experts, and scholars that are pretty close to 100% in agreement on the right size of government—smaller.

One of my favorite talks at this year’s retreat, held at the Salamander Resort in Middleburg, VA, was by Nicole Kaeding previewing Cato’s 12th biannual Fiscal Policy Report Card on America’s Governors written by Chris Edwards and Kaeding.

What’s great about the Cato Club 200 retreat is that the scholars are available for discussion all weekend long. I always make it a point to talk with my friend Chris Edwards and catch up on his work at DownwsizingGovernment.org. I also visited with Kaeding after her talk to get the inside scoop on the governors report—needless to say it’s no surprise California’s Jerry Brown is at the bottom of the list.

It’s worth noting that 9 out of the top 10 governors with “A” or “B” grades are Republicans which tells me they can do the right thing with proper guidance. As for the bottom of the list there were 8 “F”s and all were Democrats telling me the only way to reform this group is to vote the bums out.

This year we awarded “A” grades to four governors:

• Pat McCrory of North Carolina signed a bill replacing individual-income-tax rates of 6.0, 7.0, and 7.75 percent with a single rate of 5.75 percent. He also cut the corporate-tax rate from 6.9 to 5.0 percent and repealed the estate tax.

• Sam Brownback of Kansas approved a plan in 2012 replacing three individual-income-tax rates with two and cutting the top rate from 6.45 to 4.9 percent. The reform also increased the standard deduction and reduced taxes on small businesses. Brownback cut income-tax rates further in 2013.

• Paul LePage of Maine signed major income-tax cuts in 2011, and he is pushing for further tax reforms. State spending has been roughly flat in recent years, and LePage has trimmed spending on welfare, health care, and other programs.

• Mike Pence of Indiana has been frugal on spending and a champion tax cutter. He signed bills to cut individual-income-tax rates 5 percent (the current rate of 3.4 percent will fall to 3.23 percent in 2017) and repeal the inheritance tax. He also approved a corporate-income-tax rate cut and a major reduction in property taxes on businesses.

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