Spending

VIDEO: Daily Caller Remembers 9/11, Examines Life Since

Via the Daily Caller’s video producer Sean W. Malone comes this new mini-documentary reflecting on the horrors of 9/11, and an examination of how America and the world reacted in terms of public policy. The video features Daily Caller editor-in-chief Tucker Carlson, Cato Institute vice president for defense and foreign policy studies Christopher A. Preble, Cato research fellow in defense and homeland security studies Benjamin H. Friedman, Heritage Foundation’s director of the Douglas and Sarah Allison Center for Foreign Policy Studies James Carafano, Rep. Allen West (R-Fla. 22nd), and Antiwar.com’s development director Angela Keaton.

National security policy, like all other forms of public policy, involves an innumerable series of trade-offs. We should be applying the same rigorous cost-benefit analyses to the Pentagon and DHS budgets that we do to social welfare programs.

The best line in the whole video comes from Tucker Carlson, who quips,

VIDEO: Cato’s Primer on Obama’s Jobs Speech

We can only hope the president will have time to preview this video before his address — but really, would it matter?

Video produced by Caleb Brown, host of the Cato Daily Podcast, and Austin Bragg.

The Cruise Control Act of 2011

Federal spending has ballooned 28 percent during the Obama Presidency while the government has amassed more debt than it acquired from the first day of George Washington’s administration to the last day of George H. W. Bush’s.

Our nation is racing toward a fiscal cliff. Yet, as Sen. Jim DeMint noted, instead of hitting the brakes, Congress and the President just set the cruise control. “The Budget Control Act of 2011” offers an object lesson in exactly the sort of empty compromise that has gotten our nation into its present mess. Faced with the devastating consequences of unprecedented and unsustainable federal spending, both parties agreed on only one thing: to lock in that spending for at least the next two years. Bypassing the normal legislative process, the deal was written behind closed doors and dumped it into the laps of both houses under the threat that failing to pay the government’s bills would jeopardize the nation’s triple-A credit.

Unfortunately, the deal didn’t just pay our current bills – it gave the most spendthrift administration in history an open credit line to continue its spending spree beyond 2012. Ironically, it ended up costing the United States its triple-A credit rating by failing to rein in spending significantly. Indeed, Standard and Poor’s had explicitly warned for the last two months that $4 trillion had to be cut from the projected ten-year deficit to preserve the nation’s credit. Even if the plan works perfectly, it doesn’t come close.

Yet the same politicians who ignored these warnings were shocked-just-shocked when Standard and Poor’s lowered the boom four days later. Instead, they blamed the “Tea Party” that has been sounding the same alarm for more than two years.

CHART OF THE DAY: Washington Fat Cats Are Getting Fatter

Welcome, Instapundit readers!

Ouch:

Federal regulatory jobs have grown at almost triple the pace of private sector jobs under Barack Obama

Investors Business Daily reports:

 

Under President Obama, while the economy is struggling to grow and create jobs, the federal regulatory business is booming.

Regulatory agencies have seen their combined budgets grow a healthy 16% since 2008, topping $54 billion, according to the annual “Regulator’s Budget,” compiled by George Washington University and Washington University in St. Louis.

That’s at a time when the overall economy grew a paltry 5%.

Meanwhile, employment at these agencies has climbed 13% since Obama took office to more than 281,000, while private-sector jobs shrank by 5.6%.

 

If you missed my piece the other day on recession-proof DC, check it out.

Also, pick up a copy of Iain Murray’s Stealing You Blind. In addition to being a scholar at the Competitive Enterprise Institute, Murray is an Englishman whose legal immigration to the U.S. took four years, no thanks to our bloated, inefficient bureaucracy.

The Debt Generation and…Fireworks? Sort of…

Man, I looove me some fireworks. The bright flashes, the intense color, the wave of energy expanding across the room—

Oh, you thought I meant that stuff they light off at the Fourth of July. No, I was referring to the fireworks that occur in a debate. And what a debate we’re going to have!

The sparks started flying when Matt Yglesias, poster boy for the Center for Authoritarian Propaganda American Progress tweeted “David Boaz is dumb.” (Hmm, I wonder what he had to say about naughty rhetoric back in January…) Boaz then retorted that Yglesias had completely missed the point, which I guess is not surprising. Yglesias then decided to tackle Daniel J. Mitchell’s take on Paul Krugman’s…well, I’m not really sure what you could call it. Lunacy? Let’s be nice and just call it “absurdity.” Anyways, Yglesias basically stated that “money doesn’t matter” and that the broken window fallacy itself is broken. A very succint summary of modern progressive thought, I would imagine.

So why do I bring this all up?

Because tomorrow, Cato On Campus is hosting (at the Cato Institute, natch) a debate titled: “US Debt and the Millennials: Is Washington Creating a Lost Generation?” Attending will be Megan McArdle of The Atlantic, Matt Mitchell of Mercatus, and Matt Yglesias of Center for American Progress. Three guesses as to who will be moderating. Yes, Dan Mitchell of Cato.

DC Is Recession-proof, and Washingtonians Know It

I moved to Washington, DC two years ago for graduate school — apparently, as a freshly-credentialed MPP entering the job market, my timing was impeccable. But I can’t say I’m really happy about what it means more broadly for the direction in which the country is heading.

Catherine Rampell at the New York Times Economix blog reports (emphasis mine):

In every state, a majority of residents think the economy is getting worse. In the nation’s capital, however, a full 60 percent of people think the economy is getting better.

Cato’s David Boaz examined the reasons behind this dynamic here and here.

Reader’s Digest version: the Bush-Obama spending binge has spurred more growth in Washington, DC than anywhere else in the country. That’s because new federal agencies with new missions (or new missions at existing agencies) need new personnel. But beyond a simple expansion of the government itself came an expansion of the special interest class, eager to get its mitts on new waves of federal spending.

As if we didn’t have enough to worry about with millions unemployed across the country and new levels of uncertainty abounding, this doesn’t bode well for friends of the free market.

What can we do about it? Get involved.

August 2nd: A Day That Won’t Live In Infamy

If a deal hasn’t been reached by the time this is posted (the agreement reached by congressional leaders and the White House over the weekend is pending caucus approval), then tomorrow will be a day of infamy. According to public consensus, our credit rating will be downgraded, our borrowing rates will skyrocket, Social Security checks won’t go out, we’ll have to lay off millions of government workers (oh hyperbole), China will get mad, and our cost of living will sharply increase while the quality of living decreases dramatically. The sky will fall, the world economy will collapse, unemployment will make what we have now look like a cakewalk. It will be Disaster;.

Except it will be none of these things.

August 2nd, if a deal is not reached, will not spell the end of the world. Even if S&P and Moody’s try and downgrade the United States. Why? Three reasons: One, if the markets thought we were going to be screwed, they would have done it before. Second, the credit rating agencies are utterly superfluous and worthless when it come to US debt. Third, even if we hit the debt ceiling, Turbo Tax Geithner will be permitted to prioritize interest payments on the debt and send out Social Security checks, meaning we won’t have a default (and Grandma can still buy the ingredients for her damned fruitcake.)

Taken together, these three things illustrate a picture where August 2nd isn’t the end of the world, and that we should really slow down, take a deep breath, and then have a shot of whiskey. Preferably rye, but that’s just me.

Article the First: The market was supposed to explode under the debt ceiling, showing how urgent and necessary it is to raise it, according to John Carney:

The Debt Debate, “Cut Cap Balance,” and Bush (Video)

As the debt debate continues with no end in sight (not even Aug. 2nd) some people are getting understandably upset. They want to know who to blame, and if anything that’s come up so far will actually fix the problem. Well, I have good news and bad news.

The good news is that the Cato Institute has come out with another outstanding video on the situation. The bad news is that you have to blame everybody, and no, there isn’t really a good solution coming out yet:


Again, there will be no dismantling of unconstitutional (or just flat out bad) programs and departments, just “trimming” around the edges, which won’t be good for the long term as they’ll a piece of cake to overcome. The “Cut Cap Balance” idea is a good start, but the Democrats will never go for it, and it’s only that—a start.

The Imperial Presidency, Round #43917

So Senator Mitch McConnell has released a “solution” to the debt ceiling crisis. Jason has already jumped on this topic, but I feel the need to add my own two cents. For me, the crucial portion of this non-solution is that it gives additional power to the White House, and perpetuates a seeming tradition of Congress abdicating responsibility that we’ve seen over the past decade.

The entire deal punts the debt and spending over to the President. Essentially, he decides to raise the debt limit. While Congress can pass a “bill of disapproval” with a two-thirds majority, the President can simply veto, which would then require a 2/3 vote to override. The plan would also require the President to make spending cuts roughly equal to the increase in the debt limit (as I understand it.) Yet there is no enforcement mechanism that I can see to ensure he does so. What would Congress do if he raised the debt limit with no corresponding cut in spending? Stamp their feet? It might be all they can do.

Haven’t we seen enough power consolidated in the Oval Office yet?

I mean, the President can assassinate people with a drone without so much as a whoopsie-daisy; have anyone imprisoned on suspicion of terrorism and interrogated; can have a lovely jaunt off to war and only send Congress a politely-worded letter; formulate budgets and tax policy while merely requesting Congressional approval; through executive agencies and department make and enforce law without a vote; and now we’re going to give him the power to unilaterally raise the debt limit with requirements that are so wishy-washy they make Natty Light look good?

Yes, the Stimulus Really Did Fail

I have to disagree with Dave Weigel here. He wrote on Friday in Slate that the stimulus bill really didn’t fail, although everyone is saying it is:

Veterans of the stimulus wars talk about it that way—as a war. They lost. The implication of the loss is that Keynesian economics are, arguably, as discredited with voters as neoconservative theories were discredited when the invasion of Iraq failed to turn its neighbors into vibrant democracies, highways clogged with female drivers.

This week, we got a concrete example of what it meant to lose. The Weekly Standard published a back-of-the-cocktail-napkin analysis of the seventh quarterly report on the stimulus, stipulating that every job created by its spending has cost $278,000. Republicans, who’d previously said the stimulus created no jobs, immediately started repeating the $278,000 figure. They kept doing it even after the magazine followed up, suggesting that the cost-per-job could have been as low as $185,000. $278,000, $185,000. $0.00? It didn’t really matter, because the White House and liberal response was perfunctory. As the stimulus winds down, with most of the money spent, everyone knows that it failed.


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