Thursday, November 29, 2012

Some Supporters of Obamacare Admit Some of its Failures

a.k.a. Econ 101 for Law Professors

Some supporters of Obamacare are honest enough to admit a few of its warts. Would that they would take those admissions to their logical conclusions.
Read the full article at:

More Health care reform resources on the Obamacare page.

Monday, November 26, 2012

Why Government Interference in Markets Always Fails

For citizens and law professors who believe that the government is Santa Claus, capable of blessing the nation with prosperity by way of market manipulations, a review of certain basic economic principles, easy to understand if equally easy to forget, is in order.
Few economists have illustrated as plainly and logically as Ludwig von Mises why price controls (and by extension, all types of interventions in free markets) don't work, never achieve their stated goals. For this reason we present here an excerpt from the chapter 'Interventionism' from his book 'Economic Policy', published by Regnery ( and the Mises Institute (

The government hears people complain that the price of milk has gone up. And milk is certainly very important, especially for the rising generation, for children. Consequently the government declares a maximum price for milk, a maximum price that is lower than the potential market price would be. Now the government says: "certainly we have done everything needed in order to make it possible for poor parents to buy as much milk as they need to feed their children."
But what happens? On the one hand, the lower price of milk increases the demand for milk; people who could not afford to buy milk at a higher price are now able to buy it at the lower price which the government has decreed. And on the other hand some of the producers, those producers of milk who are producing at the highest cost – that is, the marginal producers – are now suffering losses, because the price which the government has decreed is lower than their costs. This is the important point in the market economy. The private entrepreneur, the private producer, cannot take losses in the long run. And as he cannot take losses in milk, he restricts the production of milk for the market. He may sell some of his cows for the slaughterhouse, or instead of milk he may sell some products made out of milk, for instance sour cream, butter or cheese.
Thus the government's interference with the price of milk will result in less milk that there was before, and at the same time there will be a greater demand. Some people who are prepared to pay the government-decreed price cannot buy it. Another result will be that anxious people will hurry to be the first at the shops. They have to wait outside. The long lines of people waiting at shops always appear as a familiar phenomenon in a city in which the government has decreed maximum prices for commodities that the government considers as important. This is happened everywhere when the price of milk was controlled. This was always prognosticated by economists. Of course, only by sound economists, and their number is not very great.
But what is the result of the government's price control? The government is disappointed. It wanted to increase the satisfaction of the milk drinkers. But actually it has dissatisfied to them. Before the government interfered, milk was expensive, but people could buy it. Now there is only an insufficient quantity of milk available. Therefore the total consumption of milk drops. The children are getting less milk, not more. The next measure to which the government now resorts, is rationing. But rationing only means that certain people are privileged and are getting milk while other people are not getting any at all. Who gets milk and who does not, of course, is always very arbitrarily determined. One order may determine, for example, that children under four years old should get milk, and the children over four years, or between the age of four and six, should get only half the ration which children under four years receive.
Whatever the government does, the fact remains, there is only a smaller amount of milk available. Thus people are still more dissatisfied than they were before. Now the government asks the milk producers (because the government does not have enough imagination to find out for itself): "why do you not produce the same amount of milk you produced before?" The government gets the answer: "we cannot do it, since the cost of production are higher than the maximum price which the government has established." Now the government studies the costs of the various items of production, and it discovers one of the items is fodder. "Oh," says the government, "the same control we applied to milk we will now apply to fodder. We will determine a maximum price for fodder, and then you will be able to feed your cows at a lower price, at a lower expenditure. Then everything will be all right; you will be able to produce more milk and you will sell more milk. "
But what happens now? The same story repeats itself with fodder, and as you can understand, for the same reasons. The production of fodder drops and the government is again faced with a dilemma. So the government arranges new hearings, to find out what is wrong with fodder production. And it gets an explanation from the producers of fodder precisely like the one that it got from the milk producers. So the government must go a step farther, since it does not want to abandon the principle of price control. It determines maximum prices for producers goods which are necessary for the production of fodder. And the same story happens again.
The government at the same time starts controlling not only milk, but also eggs, meat, and other necessities. And every time the government gets the same result, everywhere the consequence is the same. Once the government fixes a maximum price for consumer goods, it has to go farther back to producer's goods, and limit the prices of the producer's goods required for the production of the price-controlled consumer goods. And so the government, having started with only a few price controls, goes farther and farther back in the process of production, fixing maximum prices for all kinds of producer's goods, including of course the price of labor, because without wage control, the government's "cost control" would be meaningless.
Moreover, the government cannot limit its interference into the market to only those things which it views as vital necessities, like milk, butter, eggs, and meat. It must necessarily include luxury goods, because if it did not limit their prices, capital and labor would abandon the production of vital necessities and would turn to producing those things which the government considers unnecessary luxury goods. Thus, the isolated interference with one or a few prices of consumer goods always brings about effects – and this is important to realize – which are even less satisfactory than the conditions that prevailed before.
Before the government interfered, milk and eggs were expensive; after the government interfered they began to disappear from the market. The government considered those items to be so important that it interfered; it wanted to increase the quantity and improve the supply. The result was the opposite: isolated interference brought about a condition which – from the point of view of the government – is even more undesirable than the previous state of affairs which the government wanted to alter. And as the government goes farther and farther, it will finally arrive at a point where all prices, all wage rates, all interest rates, in short everything in the whole economic system, is determined by the government. And this, clearly, is socialism.

More Health care reform resources on the Obamacare page.

Friday, November 23, 2012

Required Reading from American Thinker

Politicians, at our request, pretend that real spending cuts aren't necessary.
Read the full article here:
The Left continues to play games with unconstitutional words as long as they approve of the result. Read the full article here:

Thursday, November 22, 2012

Argentina (and America) on the Brink

Now that Argentina is on the brink of economic and social collapse -- again -- this might be a good time to be reminded of what could have been for Argentina if only it had followed correct economic principles, and what will be in store for us in the US if we don't.
Little over a hundred years ago, Argentina was the eighth weathiest country in the world. Let that sink in for a minute; wealthier than Japan, Italy or Brazil.
In 1959, a visit was paid to Argentina by one of the world's greatest economists, Ludwig von Mises, dean of the Austrian school of economics and mentor of the Nobel laureate Friedrich Hayek.  He gave a series of lectures, and those lectures were transcribed into a short book later published under the title 'Economic Policy: Thoughts for Today and for Tomorrow'.  It is perhaps the best comprehensive exposition of Mises' economic philosophy in a small package easy to read and accessible to the comprehension of the common citizen.  For those of us lacking the time and patience to wade through his 1949 magnum opus 'Human Action', with its 900 pages of almost German academic English, Economic Policy is a welcome plain-language and brief alternative. Next to Thomas Sowell's evolving editions of Basic Economics, Mises' Economic Policy is THE book for the person who has never read one on economics or has only read dismal mathematical, keynesian and/or college textbooks.  
The history of Argentina for the past 50 years is one of tragedy followed by misery, repression and economic crisis, each episode ratcheting up the impoverishment of a once proud people. How much suffering could Argentina have avoided if only they had taken Mises' advice? 
If the United States continues on its present crony-socialist course, we too will be remembered one day as a once-great nation. Putting a copy of Mises' book into the hands of every politician, student and citizen would be a good place to start reversing the decline.  

Read Mary Anastasia O'Grady's analysis of the current mess here: 

Sunday, November 18, 2012

ObamaCare Is Not a Done Deal

The majority of state governors are Republicans, and they have the power to disarm the health-care law.
Read the full story here:
Wall Street Journal: Capretta and Levin: Why ObamaCare Is Still No Sure Thing

More Health care reform resources on the Obamacare page.

Brett Stephens on Immigration and Latin American Culture

"If the argument is that illegal immigrants are overtaxing the welfare state, then that's an argument for paring back the welfare state, not deporting 12 million people. If the argument is that these immigrants "steal" jobs, then that's an argument by someone who either doesn't understand the free market or aspires for his children to become busboys and chambermaids."
"And if the argument is that these immigrants don't share our values, then religiosity, hard work, personal stoicism and the sense of family obligation expressed through billions of dollars in remittances aren't American values."
"By the way, what's so awful about Spanish? It's a fine European language with an outstanding literary tradition—Cervantes, Borges, Paz, Vargas Llosa—and it would do you no harm to learn it. Bilingualism is an intellectual virtue, not a deviant sexual practice. "
Read the full article at The Wall Street Journal.

Obamacare is still vulnerable

States can still resist being sucked into the sucker's game of doing the federal government's dirty work on Obamacare.
Read the full story by Michael F. Cannon at the Cato Institute.

More Health care reform resources on the Obamacare page.

Friday, November 16, 2012

WSJ: Republican Success in the San Joaquin Valley

Republicans who think that reaching out to the Hispanic vote is futile need to study California's 21st District, which is 70% Hispanic and voted for Obama in 2008. They just elected a Rebublican to the US House of Representatives with 60% of the ballots.
Read the full story by Kimberly Strassel at The Wall Street Journal

Republicans and the 2014 Hispanic Vote

The Hispanic vote is receiving renewed attention following the 2012 election fiasco. Businessman Romney may be credited with the dubious achievement of a market share lower than John McCain’s: just 27%. Republicans, including Tea-partiers and talk show hosts like Sean Hannity are waking up to the fact that a demographic that is growing at more than 40 percent in a decade, with more than 20 million eligible to vote, cannot be ignored if the party intends to remain viable. The challenge is how to appeal to Hispanic citizen voters without compromising conservative, limited constitutional government principles. It would be futile to attempt to out-Santa Claus the Democrats; nevertheless Republicans must take a change of strategy, of policy priorities and perhaps most important, of attitude. Too paraphrase Peggy Noonan, some people don’t like Republicans because they perceive that Republicans don’t like them.
It has been observed enough times that the values and interests of Hispanics should make them naturally gravitate to the Republican party. Hispanic immigrants are hard-working, pro-family, pro-traditional marriage, pro-life and religious. A high percentage are small businesses owners and entrepreneurial capitalists and are grateful to the United States of America for the opportunities it has afforded them. Like all Americans they yearn for the American Dream, starting with good job prospects. Ronald Reagan once quipped that most Hispanics are Republicans, they just don’t know it yet. The Republican failure to convince more than a shrinking fraction of them speaks at least as poorly of Republicans as it does people who seem to contradict their own values and interests in the way they vote.
So what do we do? Permit me to propose a 3-pronged strategy:
1. Treat Hispanics/Latinos like everyone else. We are the party of, by and for Americans, not hyphenated-Americans, ethnic victim groups and single-issue special interests.
2. Educate Americans about constitutional, limited-government, and free-market economic principles, in Spanish as well as English. To set an example, this author gives lectures on the American Revolution, the Declaration of Independence and the Constitution (no partisan political preaching required), together with American Revolution film screenings, in Spanish-language churches.
News Flash!: the Spanish-language news media leans Left. But the Spanish-speaking public is just as diverse as the English-speaking public. There is a huge ground-floor opportunity to build a conservative commentary industry on the Spanish-language radio and TV airwaves, cable, satellite and social media. The movers and shakers in the conservative media need to make it happen.
And 3: Take the high road with respect to immigration policy, not just with respect to illegals and low-skilled workers, but at the high end, the PhD in engineering end, as well.
The Republican party should be seen frequently and consistently proposing and promoting its own positive immigration reform, in simple, bite-sized pieces. Rather than inflicting a national root-canal of comprehensive omnibus corrupt pork legislation on the scale of ObamaCare, just propose one simple policy change at a time, say one per month, debate it, vote it up or down and then to the next bite-sized piece.
Republicans can:
• Propose to relax immigration restrictions in exchange for a surcharge on immigrant’s payroll and income taxes.
• or charge a $1000 per head for the right to immigrate, which is a third less than the going rate for coyote fees to risk death to be smuggled across the desert.
• Propose an uncomplicated guest worker program and normalization, NOT CITIZENSHIP but some form of normalized guest status, for people already here who are not felons. We had a guest worker program in the 1950’s called Bracero, and in the main it worked.
• Allow people educated in America legally to work, produce, pay taxes and hire other Americans in America. Right now we educate people in America and then throw them out, which makes no sense. (By the way, just because some people aren’t in the US doesn’t mean we don’t have to compete with them; better to keep them where they do us the most good.) This includes children of illegals whose college education we have already paid for (whether we SHOULD have paid for it or not is beside the point after the fact).

Republicans can propose solutions that are market-based, more effective and more humane than enforcement-only; reforms that are consistent with limited government and free-market principles which the Democrats will be embarrassed to oppose. We can put Democrats on defense even as we interleave proposals for such things as repealing the 1975 amendment to the Voting Rights Act that required printing election materials in foreign languages. So we can include proposals that are dear to our conservative hearts along with olive branches to the Latino community. The list above is only intended to be a starting point.
But, Republicans absolutely need to purge from their brains the idea of deporting 11 million people. It ain’t gonna happen!

Taking the high road means refraining from foaming at the mouth in public over illegal immigration. I love Rush Limbaugh, I love Mark Levin and Michael Savage and Mike Galagher, Laura Ingraham, Ann Coulter and Michelle Malkin etc, but I don’t think they have helped on net balance to win hearts and minds. The Hispanic community is very family-oriented, and many citizen voters have cousins whose legal status is less than perfect. If you appear hostile to someone’s cousin, whether you mean to or not, you alienate that person. In politics, perception is reality, and the perception is that the Republican party is anti-immigrant in general and anti-Latino, possibly with racist motives, in particular. Our challenge is at the very least not to provide cheap ammunition to the Democrat machine to shoot us with.
This does not mean we have to surrender principle. But it does mean changing the rhetoric and yes, compromising with some people and policies that we might not like so much.

Resistance to change is often based on limited information, therefore permit me to present a few facts and stats about immigration in America today:
• Immigration as a proportion of population today is about half of what it was in the peak years a century ago.
• Net immigration from Mexico for the past two years has been approximately zero.
• Immigrants complement the native population with higher numbers at the low and high end of the skills and education spectrum, while natives are concentrated in the middle.
• New immigrants are more concentrated than are natives in the youthful labor-force ages when people contribute more to the public coffer than they draw from it. The average age is 28.
• In spite of the drug cartel wars, the Mexican economy has improved under President Felipe Calderón, with a rising tide of opportunity for Mexicans at home. I wish our economy were growing half as fast as Mexico’s.
• Putting aside the Great Recession and non-recovery, our economy still creates hundreds of thousands of jobs each year that only require minimal training. The supply of native-born workers without a high school diploma is shrinking by about 300,000 per year. All of Obama’s unemployed college graduates are not pining to pick lettuce. Any immigration policy built on the premise that we won’t need any additional foreign workers in the future is doomed.
• At least one quarter of illegal aliens enter the country legally and overstay their visas and permits. Therefore sealing the border will not solve the whole problem; in fact it may be counter-productive as it discourages people who wish to return home on their own from doing so.
• Cities with high immigrant populations have lower prices for child care, house cleaning, gardening, dry cleaning and other services essential to permitting college-educated women with children to pursue their professional careers.
• Social Security and Medicare are by far the most expensive transfer payments made by the government, and these payments go almost entirely to natives. This is because immigrants typically arrive when they are young and healthy, and also because older recent immigrants do not qualify for Social Security for many years after their arrival.

Now if all of that paints too rosy a picture, let’s talk about problems commonly associated with immigration:
• Crime: While immigration rates have been on the rise in the last two decades, until Obama the violent crime rates had been decreasing. The crime rate is higher for native-born Americans than it is for immigrants. More immigration does not lead to more crime overall, even if a few exceptionally bad cases make the headlines. Offering and accepting employment at mutually agreeable wages is not fundamentally immoral.
• Infectious disease: A more open immigration policy that permitted workers to enter through the front door without fear would provide the opportunity for health screening.
• Terrorism: We need a policy that makes it more difficult for bad people to hide among the masses of honest immigrants who come for work and opportunity. More openness and transparency is the terrorist’s enemy.
• Assimilation: 88% of 2nd-generation immigrants are fluent in English. Immigrants know they can double their income by learning English. The single most formidable obstacle to assimilation is the leftist indoctrination that pupils receive in our public employee union-dominated schools, and that is not the fault of immigrants.
• Similarly regarding Communist infiltration and agitation: This also is a homegrown issue, not an immigration problem. The battleground of radical leftism is in the public schools and universities and in labor union legislation and policy; not the border.
• Narcotraffic is not an ‘immigration’ issue. Putting aside ‘Fast and Furious’, it is American drug consumers that provide the guns for the gangs with their dollars.
Speaking of compromise, it may be time to sit down with the long-haired, maggot-infested, dope-smoking commie pinko hippies like…Pat Robertson, George Schultz, the editorial board of the Wall Street Journal -- freaks like that -- who will tell you that drugs are bad, no doubt about it, but that drug wars don’t get a free pass on their track record. Agree or disagree with prohibition vs. legalization, the illicit drug industry is distinct from immigration and we must not be so clumsy as to allow the Democrat party to spin it as a racial issue with Republicans wearing the white sheets.
• Welfare and public service abuse: the problems of the nanny state are inherent to socialism. Government social welfare programs are prone to corruption and abuse. We can’t scapegoat housecleaners and migrant farm workers for the natural consequences of our own socialistic policies. Fight socialism, not immigration.

I believe these facts justify a high-road strategy mostly in favor of immigrants and immigration. I would like to persuade Republicans that the Dream Act, or similar reform, is not the worst thing ever proposed, not the greatest threat we face, but something we can live with. We say that we want illegals to get in line with everyone else, but we haven’t provided any line at all for most of them. Dogmatic opposition to this and any reform like it is costing us far more than we are getting in return.
Many of my friends on the right will find some of these recommendations too liberal to stomach, too much slouching toward amnesty, too offensive to the letter of the law and to the sovereignty of America. To those especially I would ask to consider their priorities. Is sealing the border more important than combating Obamacare? Is it more important that holding the line on tax rates on small businesses? Does punishing illegal immigrants take precedence over reforming Medicare and Social Security, reducing the size and scope of the federal government, and re-launching job creation and economic growth? What constitutes a greater threat to our freedom and prosperity: Cap and Trade, unfunded defined-benefit pensions for government employees, dependence on foreign oil and domestic windmills, expanding entitlement programs, Iran’s nuclear ambitions, China’s rapidly-growing Pacific navy, North Korea, radical Islamic Shariah law -- or Jose Gonzales, minimum wage-earning illegal food-processing worker, with a fake social security number by which he pays taxes to the treasury which he will never be able to collect as benefits?
Republicans need all the help they can get, and high priority goals are worth compromising for.
Permit me to quote a couple of liberals on this issue:
 “The problem has to be solved. Because as we’ve made illegal some kinds of labor that I’d like to see legal, we’re doing two things: We’re creating a whole society of really honorable, decent family-loving people that are in violation of the law, and secondly we’re exacerbating relations with Mexico.”
That ‘liberal’ was George Herbert Walker Bush.
 “Rather than talking about putting up a fence, why don’t we work out some recognition of our mutual problems? Make it possible for them to come here legally with a work permit--and then while they’re working and earning here, they pay taxes here. And when they want to go back, they can go back. And open the border both ways by understanding their problems.”
That ‘liberal’ was Ronald Reagan.
Let us not forget that the single most effective means of reducing illegal immigration would be to so destroy our economy that no one would want to come here anymore. In other words, it’s a good problem to have, and we have it a lot better here than in socialist countries like France where the immigrant male youth unemployment rate is somewhere between 40 and 50%. That is a social catastrophe we won’t face as long as remain true to our limited government principles.
America’s ideals are universal, not ethnic or limited to the direct descendants of the Mayflower. Regardless of color, accent, flavor or spices, we can still have an America we recognize in 100 years if it is based on the Declaration of Independence and the Constitution. To achieve this we must fight FOR good policy, not against good people.

Wednesday, November 14, 2012

WSJ: Immigrants and the GOP

The GOP's Presidential election defeat is opening up a debate in the party, with more than a few voices saying they are willing to rethink their views on immigration. This is good news, which means it's also a good moment to address some of the frequent claims from the anti-immigration right that simply aren't true, especially about Hispanics.

Read the full article at:
Wall Street Journal

Tuesday, November 13, 2012

What Do Young People Believe?

One of the most remarkable impressions of election night was seeing, in places like Times Square and the Obama campaign stadium in Chicago, crowds of young people, cheering, laughing, dancing, crying with joy over the result. Since these are the people who will have to live with the consequences of this election the longest, it is worth asking: what is it exactly that they are cheering? What do they believe?

Read the full article at Front Page Magazine.

Monday, November 12, 2012

Reflections on Elections

Why Obama Won

The young voters who celebrated Obama's victory don't know that they are voting against their own interest, because although many may have advanced degrees, they are substantially uneducated.

By Gary Aminoff, vice chairman of the Republican Party of Los Angeles County

The GOP's Epic Senate Fail

The National Republican Senatorial Committee, lead by establishment Republicans hostile to the grassroots and to the Tea Party, promoted a slate of mediocre candidates.

By Kimberly Strassel, Wall Street Journal

Economy: Post-Election Firings and Layoffs Surge

The victory by Barack Obama on election night has resulted in a huge wave of firings and layoffs all over America. A large number of businesses seem to have suddenly shifted into panic mode. The number of layoff announcements that we have seen in the last 48 hours has been absolutely shocking.

By Michael Snyder for Market Daily News

What Does the Election Mean for Obamacare?

The bad news is that many of the health care law’s serious effects were delayed until after the election. Ten of its 18 new tax hikes have yet to kick in. And there is still so much about the law that we don’t even know.

By Nina Owcharenko for The Heritage Foundation

Business Rejects Obamacare Elections, as it is often said, have consequences. As a result of the president’s reelection, the Affordable Care Act, aka Obamacare, will be fully implemented. Unsurprisingly, several businesses are looking for ways to avoid the costs associated with the law. Just as unsurprisingly, American leftists consider such efforts to keep one’s business profitable–or solvent–unseemly.

By Arnold Ahlert for Front Page Magazine

The Meaning of Yesterday's Defeat

America is a deeply divided country with a center-left plurality. This plurality includes a vast number of citizens who describe themselves as moderates, but whose views on the issues are identical or similar to those that have historically been deemed liberal.

By John Hinderaker for Powerline Blog

¡Estimados Republicanos!

The GOP's immigration and Hispanic debacles.

The Wall Street Journal Review & Outlook

Vote Data Show Changing Nation

President Barack Obama's election victory exposed tectonic demographic shifts in American society that are reordering the U.S. political landscape.

The 2012 presidential election likely will be remembered as marking the end of long-standing coalitions, as voters regroup in cultural, ethnic and economic patterns that challenge both parties—but especially Republicans.

By Neil King Jr.

The Tea Party Got It Right, Mitt Got It Wrong

Mitt Romney won the primaries because he was electable. But, as it turned out, he really wasn’t electable after all. Not when the chief criteria of electability is having no opinion, no point of view and no reason to run for office except to win. Not when the chief criteria of being a Republican presidential nominee is being able to convince people that you’re hardly a Republican at all.

By Daniel Greenfield

After Election, GOP Openness to Immigration

The need to overhaul immigration laws has emerged as a rare area of agreement among leaders in both parties. The president wants to reward one of the voting blocs that helped him secure a second term, and Republicans are eager to make inroads with a constituency that seems to be moving away from them.

By Patrick O'Connor for the Wall Street Journal