Slowing Productivity and Rising Inequality Have a Common Driver: Government Intervention

Mainstream economists are overlooking a key connection.

A growing chorus of alarmist voices decries the rising economic inequality in the Western world, especially in the United States. Surprisingly enough, the same mainstream analysts complain about the anemic growth of labor productivity without seeing the correct link between the two.

Data shows a strong correlation between labor productivity and economic inequality (the two charts below). From the end of the Second World War until the mid-1970s, labor productivity grew at a robust rate of almost 3 percent per annum (p.a.), while income inequality declined. Afterward, both trends reversed—labor productivity slowed to below 2 percent growth p.a. on average and has almost stagnated since the Great Recession, while both wealth and income inequality expanded steadily.

What common factor could explain the two divergent trends that the mainstream analysts seem to overlook? In the 1940s, Mises was impressed by the ”miraculous” rise in the standards of living of American wage earners, which had been going on for more than two centuries. For him, the answer was straightforward: capital accumulation is the driving force behind both labor productivity and standards of living convergence.

Building on Mises’s work, Rothbard explained in detail what capital accumulation requires: (i) new capital investment that lengthens the structure of production and (ii) technological progress that overcomes the diminishing returns accompanying the increase in the supply of capital goods. However, Mises also warned that depletion of the capital stock would hamper capital accumulation and labor productivity. Unfortunately, mainstream analysts and the United States seem to have forgotten this valuable lesson.

In terms of technological progress, the US has maintained its world leadership during past decades. It ranks second in the world to Switzerland in terms of both innovation and business sophistication, spends more for Research & Innovation than the OECD or EU on average relative to GDP, and makes up the majority of the top 25 universities in the world. Moreover, it has issued the same amount of patents over the last three decades compared with the previous 150 years.

In terms of capital stock, the picture is completely different. According to estimates of the Bureau of Economic Analysis (BEA), the stock of private non-residential assets per worker has increased in real terms at about 1 percent p.a. from 1947 to 2009 and stagnated since the Great Recession (left chart below). However, BEA’s alleged sustained pace of capital growth seems hard to reconcile with the falling private investment and savings since the mid-1970s (right chart below).

In addition, the BEA methodology presents some serious shortcomings. Except for cars, BEA uses the “perpetual inventory method” to estimate fixed assets. According to it, the value of the capital stock is indirectly estimated as the sum of past investment flows minus the estimated depreciation. It means that all past investments are considered sound by default, which is certainly not the case nowadays when recurrent booms and busts cause significant volumes of malinvestments. Other question marks relate to the accurate estimation of depreciation rates in the face of rapid technological progress and the use of GDP deflators as their accuracy is unreliable, especially with regard to real estate investment.

All these considerations have led not only us but also the Federal Reserve Board (FRB) to suspect that BEA’s estimates of the US capital stock are overvalued. It is intriguing that the FRB adjusts the BEA estimates downward, especially with regard to real estate assets— “structures” in BEA’s jargon when it uses them as input for the calculation of the capital stock in manufacturing. As a result, there is a substantial difference between BEA and FRB estimates of the evolution of the volume of manufacturing capital stock from 1952 to 2016, in particular for the real estate component (left chart below). Therefore, we tried to recalculate the BEA estimate of the total stock of private non-residential capital per employee by extrapolating the difference between the two manufacturing indexes coming from BEA and FRB (right chart below).

The new results suggest that the real stock of capital per worker grew in a clear and sustained manner only until the end of the 1970s and fell afterward until the trough of the Great Recession. The recalculated capital stock is more consistent with the observed declines in investment and productivity since the mid-1970s and also confirms Mises’s prediction that wrong policies would lead to capital consumption.

For the United States, the failed economic policy is the exponential growth of government intervention in the economy in the 20th century, which stifled entrepreneurship and capital accumulation. This is obvious in the rise of both government spending that redistributes away economic resources from their originators (left chart below) and the amount of regulatory burden (right chart below). Another key factor taking a toll on capital endowment is inflation, which gained traction following the de facto abolishment of the gold standard in 1971.

Most importantly, inflationary policies trigger boom-bust cycles via the artificial lowering of interest rates below their free-market level. In a recent article on the business cycle, Salerno emphasizes that “overconsumption” and “malinvestment” are the two salient marks of the boom—not “overinvestment,” as wrongly understood by some mainstream critics. It is no surprise that the capital stock per worker dropped during the business cycles that have occurred regularly since the 1970s and that culminated in the Great Recession. The illusion of the boom fuels not only capital consumption but also the polarization of wealth and incomes in the society. The fiduciary credit expansion fuels an increase in asset prices, most commonly on stock exchanges and in real estate (charts below).

Although starting from a limited number of transactions, all owners calculate their net worth with the newly inflated asset prices, boosting the value of household assets in excess of liabilities. As a result, the rich appear to get even richer in an economy on steroids. This explains why both the US national wealth has grown much faster than national income since the end of the 1970s (left chart below), and the number of wealthy people increased significantly (right chart below).

The rising inequality since the 1970s has been fueled by both the decline in labor productivity and monetary expansion inflating asset prices. Both are perverse effects of government interventionist policies, which led to a gradual erosion of the US capital stock per employee. This is the correct linkage between inequality and productivity as explained by Mises and other Austrian School economists.

People have different skills and preferences, so the free market does not lead to a complete equalization of incomes and wealth. Nevertheless, it does ensure the proper allocation of capital to increase labor productivity and satisfy the most urgent needs of consumers. As a result, the gap between the well-off and the poor is not only gradually diminishing but also gets less significant in terms of consumption. Eventually, the disadvantage of wealth inequality becomes mostly a psychological one. As long as the capitalist consumes only a fraction of his wealth and invests the rest into productive businesses, the real beneficiary of the increase in labor productivity is the poorer part of society.

This article was reprinted from the Mises Institute.

COLUMN BY

Mihai Macovei

Dr. Mihai Macovei is an associated researcher at the Ludwig von Mises Institute Romania and works for an international organization in Brussels, Belgium.

EDITORS NOTE: This column with images by FEE is republished with permission.

Data Show California Is a Living Example of the Good Intentions Fallacy

“Concentrated power is not rendered harmless by the good intentions of those who create it.”

During a speech at Harvard several years ago, Charlie Munger related a story about a surgeon who removed “bushel baskets full of normal gallbladders” from patients. The doctor was eventually removed, but much later than he should have been.

Munger, the vice chairman of Berkshire Hathaway, wondered what motivated the doctor, so he asked a surgeon who participated in the removal of the physician.

“He thought that the gallbladder was the source of all medical evil, and if you really love your patients, you couldn’t get that organ out rapidly enough,” the physician explained.

The doctor was not motivated by profit or sadism; he very much believed he was doing right.

The anecdote is a perfect illustration of the righteousness fallacy, which Barry Brownstein noted is rampant in modern politics and a key driver of democratic socialism.

The Righteousness Fallacy (also known as the fallacy of good intentions) is described by author Dr. Bo Bennett as the idea that one is correct because their intentions are pure.

It recently occurred to me that California is a perfect example of this fallacy. Consider these three facts about the Golden State:

  1. California spends about $98.5 billion annually on welfare—the most in the US—but has the highest poverty rate in America.
  2. California has the highest income tax rate in the US, at 13.3 percent, but the fourth greatest income inequality of the 50 states.
  3. California has one of the most regulated housing markets in America, yet it has the highest homeless population in American and ranks 49th (per capita) in housing supply.

That politicians would persist with harmful policies should come as little surprise. The Nobel Prize-winning economist Milton Friedman once observed the uncanny proclivity of politicians “to judge policies and programs by their intentions rather than their results.”

In his book Capitalism and Freedom, Friedman described the danger of such thinking.

[The threat comes] … from men of good intentions and good will who wish to reform us. Impatient with the slowness of persuasion and example to achieve the great social changes they envision, they’re anxious to use the power of the state to achieve their ends and confident in their ability to do so. Yet… Concentrated power is not rendered harmless by the good intentions of those who create it. 

I don’t doubt that California lawmakers, like the physician who was removing healthy gall bladders, believe they are doing the right thing. Yet they, like the physician, need to wake up to reality and realize they aren’t making people better.

COLUMN BY

Jon Miltimore

Jon Miltimore

Jonathan Miltimore is the Managing Editor of FEE.org. Serving previously as Director of Digital Media at Intellectual Takeout, Jon was responsible for daily editorial content, web strategy, and social media operations. Before that, he was the Senior Editor of The History Channel Magazine, Managing Editor at Scout.com, and general assignment reporter for the Panama City News Herald. Jon also served as an intern in the speechwriting department under George W. Bush.

EDITORS NOTE: This column with images by FEE is republished with permission.

DOD IG Reveals The Pentagon Let $27.7 Billion ‘Expire’ As Trump Seeks $5.7 Billion In Border Wall Funding

The Defense Department has relinquished over $27 billion to the U.S. Treasury since 2013 simply because it couldn’t spend the money quick enough, according to a DOD Inspector General report released Tuesday.

The DOD was required to fork over the “expired funds” because the Pentagon failed to spend it “within the legal timeframes,” according to the report.

The revelation comes as President Donald Trump is considering declaring a state of emergency that would allow him to bypass Congress and leverage unobligated military funds to build a wall along the U.S.-Mexico border.

The partial shutdown of the federal government entered its 19th day on Wednesday as Trump remains steadfast in his demand for $5.7 billion in border wall funding from Congress. Democrats, in turn, say they won’t negotiate with the president on the wall until the government reopens.

Legal analysts say Trump would have the authority to leverage unused DOD funds to construct a wall in the event he declares a national emergency.

“My instinct is to say that if he declares a national emergency and uses this pot of unappropriated money for the wall, he’s on very solid legal ground,” Harvard law professor Mark Tushnet told NBC News.

The Pentagon reported an “expired unobligated balance” of $27.7 billion in its most recent financial report, a figure that represents the amount of unused funds the Pentagon returned to the Department of the Treasury during the five-year period between fiscal years 2013 and 2018.

Funds from the federal government “expire” if they aren’t obligated on a contract anywhere between one to three years after their date of appropriation, according to the Alternative Dispute Resolution Working Group.

The $27.7 billion the Pentagon returned to the Treasury between FYs 2013 and 2018 represents “approximately 1 percent of our overall budget,” Pentagon spokesperson Chris Sherwood told The Daily Caller News Foundation. “It’s not as big as it may seem.”

A border wall along the U.S.-Mexico border could cost up to $21.6 billion, the Department of Homeland Security reported in 2017.

The Pentagon lost out on even more funds between FYs 2012 and 2017, when it failed to spend $33.6 billion on time, according to the DOD’s financial report.

Despite the Pentagon’s failure to fully commit its existing budgets on time, Trump has backed plans to increase the DOD’s budget to $750 billion in FY 2020, an 8 percent hike from the $692 billion defense budget signed into law in December 2017, according to Task & Purpose.

COLUMN BY

Andrew Kerr

Andrew Kerr

Investigative Reporter. Follow Andrew on Twitter. Contact Andrew securely at AndrewKerrNC@protonmail.com.

RELATED ARTICLE: Here’s What Would Happen if Trump Declared A National Emergency To Build The Wall

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The 116th Congress is Off and Running … But Where To?

The 116th U.S. Congress was sworn in on January 3rd. As expected, Rep. Nancy Pelosi (CA) was elected Speaker of the House, who has the unenviable job of binding up a divided chamber of Congress, as well her own party, the Democrats. This will be Mrs. Pelosi’s last hurrah and will likely mark her legacy in the history books. Whereas the House is in the hands of the Democrats, the Senate remains under Republican control. Translation, nothing of substance will happen for the next two years as the two chambers will be hopelessly gridlocked. In terms of House Democrats, the Speaker will likely have trouble controlling the far left who fought her election as Speaker.

Beginning from Day One, the Democrats have drawn a line in the sand to confront Republicans and President Trump. The subject of impeaching the President raised its ugly head again and as I predicted the desire to do so will prove to be irresistible to Democrats. Frankly, the charges are frivolous, and veteran House Democrats know even if it is passed in their chamber, the president will be exonerated in the Republican controlled Senate. So, why go through this futile exercise? To simply besmirch the character of the president as a prelude to the 2020 presidential election. The only problem is, they will likely raise the ire of the American people who elected Mr. Trump, and this is what concerns the party’s leadership. It is more about character assassination as opposed to introducing legislation to solve our problems.

Freshmen Democrats are already rattling sabers. Rep. Rashida Tlaib (MI) unapologetically called the president a Mother******. This was followed by Rep. Alexandria Ocasio-Cortez accusing the president of being a “no question” racist in a 60 Minutes interview. Neither taunts will play well in Poughkeepsie.

More trouble is in the offing though. Rep. Steve Cohen (TN) introduced legislation to eliminate the Electoral College in presidential elections, relying on the popular vote instead. Devised by our founding fathers, the Electoral College is simply brilliant in terms of maintaining parity between the interests of rural America and large metropolitan areas. Unfortunately, it is not well understood in the country anymore, particularly since Civic classes are no longer being taught in high schools. Should this legislation pass the House, it will not see the light of day in the Senate, as it would mean people in New York, Boston, Philadelphia, Miami, Atlanta, Chicago, Dallas, Denver, San Francisco, and Los Angeles, will dictate who becomes president, with little regard for main stream America. This is precisely the scenario our founding fathers hoped to avoid.

Rep. Cohen also introduced legislation to prohibit presidents from issuing pardons to themselves, their families, their administration or their campaign staff. This is a major change as the presidents have long possessed the right to pardon. What they want to avoid is a situation, such as in the final days of President Bill Clinton’s administration where he pardoned his Whitewater cronies, such as Susan McDougal. This too will likely not pass the Senate.

Also, legislation has been introduced mandating the publishing of tax returns of presidential candidates and executives in office. As I have reported in the past, this has always been an optional report for candidates to produce. It is likely the main stream media is driving this initiative. Personally, I believe your finances are your own personal affair. If you want to disclose it, fine, if not, that is fine also. Frankly, if the Democrats believe strongly in this, this should be made equally applicable to ALL government officials, including Congress and the Supreme Court, along with state, county, and municipal governments. What is good for the goose, should be good for the gander. This legislation will likely not pass as well.

Last, but certainly not least, the House and the president are at a stalemate regarding reopening the government and funding a wall for the southern border. The irresistible force has met the immovable object, and no amount of negotiations is going to change anything as it will be viewed as a sign of weakness by both sides. The one exception might be if President Trump does as he suggests and declares a national emergency which would allow him to appropriate funds for the wall. This will likely happen as the president has been releasing data and testimonies of the problems at our southern border in recent weeks. Should the president declare an emergency, it offers Democrats a way out of the confrontation without losing face, and the government can start back up again.

All of this highlights the gridlock in the nation’s capitol which we better get used to. The intent of the Democrats is to make the president look bad as we approach 2020. In addition to the legislation listed here, we will likely see a flurry of subpoenas designed to tie up the president and his administration, thereby obstructing his agenda. Because of the gridlock, we will not see anything of substance resulting from the 116th Congress, certainly not health care reform (which the Democrats campaigned on).

The only possibility might be in the area of addressing the nation’s decaying infrastructure but I am not optimistic about passage of such legislation as we are now embroiled in a game of one-upmanship, and neither side want to give the other a win.

Rep. Pelosi’s legacy will likely be defined by the gridlock of the Congress and the Democrat’s inability to bring this president to heel. If their shenanigan’s persist, they will run the risk of angering the American people, and assuring the Republicans regain the House, not to mention securing President Trump a second term. It will also likely fracture the Democrats, leaving us wondering who will become leader of their party in the House following Mrs. Pelosi’s tour of duty. People like Rep. Steny Hoyer (MD), Rep. Ray Lujan (NM), and Rep. James Clyburn (SC) will likely be viewed as clones of Mrs. Pelosi and may very well be rebuffed by younger Democrats who will want to chart a new course to the left.

The only thing we know for sure about the next two years is that it certainly will not be boring and the news media will support whoever emerges as an effective leader of the party.

Keep the Faith!

RELATED ARTICLE: What, precisely, do Democrats want to impeach Trump for?

EDITORS NOTE: This Bryce Is Right column is republished with permission. The featured photo is by Jomar on Unsplash. All trademarks both marked and unmarked belong to their respective companies.

Sweden Isn’t Socialist [+Video]

For years, I’ve heard American leftists say Sweden is proof that socialism works, that it doesn’t have to turn out as badly as the Soviet Union or Cuba or Venezuela did.

But that’s not what Swedish historian Johan Norberg says in a new documentary and Stossel TV video.

“Sweden is not socialist—because the government doesn’t own the means of production. To see that, you have to go to Venezuela or Cuba or North Korea,” says Norberg.

“We did have a period in the 1970s and 1980s when we had something that resembled socialism: a big government that taxed and spent heavily. And that’s the period in Swedish history when our economy was going south.”

Per capita gross domestic product fell. Sweden’s growth fell behind other countries. Inflation increased.

Even socialistic Swedes complained about the high taxes.

Astrid Lindgren, author of the popular “Pippi Longstocking” children’s books, discovered that she was losing money by being popular. She had to pay a tax of 102 percent on any new book she sold.

“She wrote this angry essay about a witch who was mean and vicious—but not as vicious as the Swedish tax authorities,” says Norberg.

Yet even those high taxes did not bring in enough money to fund Sweden’s big welfare state.

“People couldn’t get the pension that they thought they depended on for the future,” recounts Norberg. “At that point the Swedish population just said, ‘Enough, we can’t do this.’”

Sweden then reduced government’s role.

They cut public spending, privatized the national rail network, abolished certain government monopolies, eliminated inheritance taxes, and sold state-owned businesses like the maker of Absolut Vodka.

They also reduced pension promises “so that it wasn’t as unsustainable,” adds Norberg.

As a result, says Norberg, his “impoverished peasant nation developed into one of the world’s richest countries.”

He acknowledges that Sweden, in some areas, has a big government: “We do have a bigger welfare state than the U.S., higher taxes than the U.S., but in other areas, when it comes to free markets, when it comes to competition, when it comes to free trade, Sweden is actually more free market.”

Sweden’s free market is not burdened by the U.S.’s excessive regulations, special-interest subsidies, and crony bailouts. That allows it to fund Sweden’s big welfare programs.

“Today our taxes pay for pensions—you (in the U.S.) call it Social Security—for 18-month paid parental leave, government-paid childcare for working families,” says Norberg.

But Sweden’s government doesn’t run all those programs. “Having the government manage all of these things didn’t work well.”

So they privatized.

“We realized in Sweden that with these government monopolies, we don’t get the innovation that we get when we have competition,” says Norberg.

Sweden switched to a school voucher system. That allows parents to pick their kids’ school and forced schools to compete for the voucher money.

“One result that we’ve seen is not just that the private schools are better,” says Norberg, “but even public schools in the vicinity of private schools often improve, because they have to.”

Sweden also partially privatized its retirement system. In America, the Cato Institute proposed something similar. President George W. Bush supported the idea but didn’t explain it well. He dropped the idea when politicians complained that privatizing Social Security scared voters.

Swedes were frightened by the idea at first, too, says Norberg, “But when they realized that the alternative was that the whole pension system would collapse, they thought that this was much better than doing nothing.”

So Sweden supports its welfare state with private pensions, school choice, and fewer regulations, and in international economic freedom comparisons, Sweden often earns a higher ranking than the U.S.

Next time you hear Democratic Socialists talk about how socialist Sweden is, remind them that the big welfare state is funded by Swedes’ free-market practices, not their socialist ones.

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COMMENTARY BY

Portrait of John Stossel

John Stossel

John Stossel is host of “Stossel” on the Fox Business Network, and author of “No They Can’t! Why Government Fails—But Individuals Succeed.” Twitter: @JohnStossel.

RELATED VIDEO: Sweden: Lessons for America? – Full Video by the Free To Choose Network.

EDITORS NOTE: This column with images by the Daily Signal is republished with permission. The featured photo by is John Fornander on Unsplash.

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Cash-Desperate Illinois Is Now Taxing Lap Dances

Government is now taxing lap dances. What does it mean?

As anyone who’s ever stepped into a “gentlemen’s club” knows, lap dances can get pretty pricey. But owners of an Illinois strip joint believe the nearly $2 million tax bill they received for lap dance services provided is a bit much.

Court records show that proprietors of Polekatz Gentlemen’s Club, a strip club in Bridgeview, Illinois, a suburb of Chicago, are suing Cook County, alleging its revenue department is illegally demanding $1.7 million for lap dances under its “amusement tax.” That figure includes interest and penalties, according to The Cook County Record.

Some people may not be familiar with “amusement taxes,” which are relatively new.

In fact, in the late 1970s, when this writer was born, amusement taxes were almost non-existent, accounting for just $120 million in aggregate revenue among the 90,000 government units in the US. But as state and local governments grew (see below), so did their need to find tax revenues to sustain them.

By 1997, amusement tax revenue had increased more than tenfold to nearly $1.95 billion, according to the data website Statista. Less than a decade later, the figure had tripled to more than $6 billion nationwide (see graph below).

Still, compared to sin taxes, which exceeded $32 billion in state revenue alone in 2014, amusement taxes are rare—outside of Illinois, that is.

Statistic: State and local amusement tax revenue in the United States from 1977 to 2016 (in billion U.S. dollars) | Statista

The Land of Lincoln has been perhaps the nation’s boldest pioneer on the amusement tax front. While Chicago’s 2015 ruling, which expanded the amusement tax to cover streaming services such as Netflix and Hulu (and has since landed on Playstation users), has captured most of the national headlines, local governments such as Cook County and the city of Bloomington have also found ways to tax fun.

In fact, this isn’t the first time Illinois has been accused of illegally taxing strip joints (which are natural targets for revenue-hungry public do-gooders) with an amusement tax.

More than a decade ago, the 1st District Appellate Court in Chicago said that Chicago and Cook County ran afoul of the law with their amusement tax on strip clubs. Lawmakers had exempted live performances from the tax but failed to include establishments offering nude dancing, prompting a three-judge panel to rule that the tax constituted “content-based regulations on speech.”

Illinois politicians and bureaucrats have learned a few things since then, however. The language of Cook County’s current law (and Chicago’s) is much more inclusive. Amusement is defined as follows:

Amusement means any exhibition, performance, presentation or show for entertainment purposes, including, but not limited to, any theatrical, dramatic, musical or spectacular performance, promotional show, motion picture show, flower, poultry or animal show, animal act, circus, rodeo, athletic contest, sport, game or similar exhibition, such as boxing, wrestling, skating, dancing, swimming, riding on animals or vehicles, baseball, basketball, softball, soccer, football, tennis, golf, hockey, track and field games, bowling, or billiard and pool games.

Unlike Cook County’s previous amusement tax, strip clubs do not appear to be unfairly or unlawfully targeted. Polekatz, located about a dozen miles southwest of the Chicago Loop, is simply one of hundreds of Cook County businesses designated an “amusement operator;” therefore, the club is unlikely to receive legal protection on free expression grounds.

Polekatz’s legal strategy appears to reflect this. According to the Cook County Record, Polekatz is not arguing that the amusement tax is unconstitutional. Rather, they say the nearly $1.7 million tax bill they received is “excessive.”

To most people, the idea of taxing lap dances sounds as absurd as courts deciding if stripping is a form of artistic expression, as one New York strip club argued in 2012 in the hopes of getting a tax exemption. (In the end, after several years of litigation, a New York judge concluded that pole dancing is art; lap dances are not.)

Indeed, the idea of taxing amusement sounds a little strange to us. People are generally more comfortable with “sin” taxes, which tax naughty things like cigarettes and alcohol. But the truth is amusement taxes and sin taxes are equally awful. We give lawmakers too much credit if we assume they want or know what’s best for us.

If anything, the rise of amusement taxes illustrates an important truth: Government really doesn’t care what they tax. They’ll tax anything—work, play, or “sin”—if it sustains their ravenous appetite for spending, which is precisely the case with Illinois.

The political and economic dysfunction in Illinois is well-chronicled.

In 2017, as Illinois appeared poised to become the first US state with a “junk” credit rating, CNN ran an article explaining how Illinois became “America’s most messed-up state.”

That Illinois is on the verge of economic disaster is hardly a secret.

“We’re not Greece or Puerto Rico yet,” Adam Schuster, an economist with the Illinois Policy Institute, told The Weekly Standard in October. “We’re not functionally insolvent. But we’re right on the doorstep.”

But it’s not just the state government that’s a total mess. As City Journal recently reported, Chicago finds itself facing an incredible $28 billion pension gap, not to mention another $9 billion in outstanding debt owed to general-obligation bondholders.

The city’s plan? Borrow another $10 billion through a bond offering (despite the fact the city’s bonds are already rated as “junk.”)

It’s no mystery why the people of Illinois find themselves in this mess. Lawmakers are making extravagant promises to give people things with other people’s money. Amusement taxes are just the latest and most convenient device to help them achieve this, though hardly sufficient.

Illinois gives proof to Chief Justice John Marshall’s famous axiom: The power to tax is the power to destroy. Fortunately, the Founders created a system that allows Americans to vote with their feet, which evidence suggests many are doing. New census data show an exodus from tax-punishing states is underway.

So, if Illinois residents decide taxes on their lap dances are just a bit too creepy, they have the freedom to say enough is enough.

COLUMN BY

Jon Miltimore

Jon Miltimore

Jonathan Miltimore is the Managing Editor of FEE.org. Serving previously as Director of Digital Media at Intellectual Takeout, Jon was responsible for daily editorial content, web strategy, and social media operations. Before that, he was the Senior Editor of The History Channel Magazine, Managing Editor at Scout.com, and general assignment reporter for the Panama City News Herald. Jon also served as an intern in the speechwriting department under George W. Bush.

EDITORS NOTE: This column with images by FEE is republished with permission. The featured Image by StockSnap on Pixabay.

New Year’s Resolution: Get Your Coffee At Chick-fil-A (And Peet’s, and Dunkin’ Donuts) Instead Of Starbucks

Throughout the week, 2ndVote has urged conservative shoppers to make New Year’s consumer Resolutions. We’ve also vowed to work more closely with you to ensure that corporations are held accountable for how they spend your money. Today, we are asking you to make a final resolution in 2019: make the best possible choice when it comes to where you buy your coffee

As you know, Starbucks is the world’s largest coffee chain and a supporter of a slew of left-wing causes such as redefining marriage and sanctuary cities. Starbucks is also a financial supporter of abortion giant Planned Parenthood. Instead, consider getting your coffee from three other chains — Dunkin’ Donuts, Peet’s, and Chick-fil-A!

We are encouraging you to swap Starbucks for Dunkin’ DonutsPeet’s, and Chick-fil-A because they largely focus on you, the customer, instead of political activism. Dunkin’ Donuts’ ranks at a 2.7 out of 5 in 2ndVote’s rankings, Peet’s is a neutral 3, and Chick-fil-A ranks a 4. We are especially proud to endorse Chick-fil-A because of their well-known Christian values as well as their massive company growth which Business Insider concluded was due to amazing customer service.

2ndVote consumers won’t be alone in putting the brakes on Starbucks’ purchases in 2019. A recent stock market analysis concluded that Starbucks is facing stiff competition from other coffee chains. Competition plus 2ndVote consumer engagement could easily cause Starbucks significant heartache in the new year. Perhaps this will teach them to listen to customers all the time instead of when it’s politically convenient.

Help us continue developing this content to help conservative consumers hold companies accountable by becoming a 2ndVote Member today!

EDITORS NOTE: This column with images by 2ndVote is republished with permission. The featured image is from Shutterstock.

Gun Controllers Want Credit Card Companies to Monitor and Restrict Lawful Purchases

Gun controllers frustrated that their federal agenda has been repeatedly rejected by Americans through their elected representatives are seeking to restrict gun rights by way of the private financial system. The goal is to pressure financial services companies into either not doing business with the firearms industry and gun owners or to comprehensively surveille their lawful activity.

On December 24, the gun confiscation supporters at the New York Times ran a thinly-veiled advocacy piece by Andrew Ross Sorkin in the news section, titled, “Devastating Arsenals, Bought With Plastic and Nary a Red Flag.” The piece outlined how some of the perpetrators of high-profile mass murders had purchased firearms and ammunition in the same manner that many ordinary law-abiding Americans do, with credit cards. 

The online edition of the piece carried the headline “How Banks Unwittingly Finance Mass Shootings,” suggesting that financial services companies were somehow complicit in violence by facilitating the exchange of lawful goods that were ultimately used for criminal purposes. Under such juvenile logic the U.S. Treasury Department should have to answer for all of the unlawful conduct they’ve facilitated by printing dollars and minting coins.

According to the misbranded op-ed, banks and other financial services companies are “uniquely positioned” to monitor gun owner purchasing habits. Under Sorkin’s preferred scenario, credit card companies would require retailers to tag firearms-related purchases with additional data that could be used by the credit card companies to compile information on gun owners. The surveillance data could then be used to flag suspicious purchases for law enforcement.

Moreover, the piece suggests that this data collection could be used to restrict certain types of lawful firearms transactions outright. Sorkin suggested,

Walmart and Dick’s Sporting Goods this year announced that they would not sell firearms to anyone under 21. If banks chose to use the systems they already have in place, they might decide to monitor such customers, perhaps preventing them from buying multiple guns in a short period of time.

To their credit, when asked for comment by the Times’s advocate, the major financial transaction firms expressed a reluctance to violate the privacy of their law-abiding customers. A Visa spokesperson explained, “We do not believe Visa should be in the position of setting restrictions on the sale of lawful goods or services… Asking Visa or other payment networks to arbitrate what legal goods can be purchased sets a dangerous precedent.” A Mastercard spokesperson added that the transaction company values the privacy of their customers’ “own purchasing decisions.”

Sorkin’s “news article” echoes many of the ideas he advocated in a February 2018 Times commentary. Making clear Sorkin has none of the objectivity on this topic one might have expected from a professional journalist pursuing a news story, the earlier piece overtly advocated for leveraging the private financial system to restrict firearms transactions. Sorkin contended that it would take “leadership and courage” on behalf of the financial services industry in order to implement his private firearms restrictions, which included a plan to eliminate commonly-owned semi-automatic firearms “from virtually every firearms store in America.” Were journalistic ethics as integral to the operation of the legacy press as those institutions purport, Sorkin’s authorship of the more recent item may have drawn interest of a forthright editor, ombudsman, or the Columbia Journalism Review.

The Sorkin article is just part of a wider-ranging effort to attack firearms owners through the financial system. In April 2018, Michael Bloomberg’s Everytown for Gun Safety expressed their support for increased credit card company surveillance of firearms transactions. Moreover, the anti-gun organization has developed “guidelines” for financial institutions doing business with the firearms industry. Under the guidelines, firearms manufacturers and retailers would be forced to adopt a host of gun control measures in order to do business with financial services providers.

In 2013, Eric Holder’s Department of Justice instituted Operation Chokepoint. Under the program, the DOJ leveraged the power of the Federal Deposit Insurance Corporation to discourage banks from transacting with lawful businesses they deemed to be “associated with high-risk activity,” including members of the firearms industry.

The anti-gun proposals targeting credit card companies should be of grave concern to all gun owners. As the Federal Reserve regularly reports, consumer use of credit and debit cards is growing. The Federal Reserve Bank of Atlanta’s 2017 Diary of Consumer Payment Choice reported that “[i]n October 2017, the period covered by this DCPC, consumers made most of their payments with cash (30.3 percent of payments), debit cards (26.2 percent), and credit cards (21.0 percent).”

The recent credit card proposals also prompt important questions. Under what a scenario would a gun owner’s purchases be flagged as suspicious or be outright denied? Might the criteria be defined by anti-gun activists to include any volume of firearms-related goods they consider deviant? Gun owners routinely purchase large quantities of firearms products and ammunition for the same reason consumers buy anything in bulk, to save money.

Moreover, gun owners should be aware that any increase in the information that the financial services companies collect may wind up in the federal government’s hands. A June 2013 item in the Wall Street Journal reported that the National Security Agency was scooping large quantities of data from credit card providers. At the time, experts speculated that the NSA would not be able to obtain the exact products an individual purchased, but could see where the purchases were made and the merchant category codes. Changing merchant category code data to be more descriptive is one of the ways control advocates intend to advance their credit card company gun control scheme.

Even those who do not value the right to keep and bear arms but do cherish their other civil liberties should be concerned with the recent credit card transaction proposals. Back in early 2018, when some of these ideas were first floated, Georgetown University Law Professor Adam Levitin pointed out, “There’s a privacy angle here… There’s the slippery slope danger if it’s guns today maybe it is pornography tomorrow and the day after it’s right-wing literature.” 

And with even mainstream television fare such as “Friends,” “Seinfeld,” and “The Simpsons” having come under fire by today’s social justice vigilante mob, it’s difficult to imagine any product or service that could be immune from their perpetually outraged sensibilities.

New rules or surveillance procedures imposed by the credit card industry on firearms transactions would have a profound negative effect on gun owners and the firearms industry and pose a broader threat to all liberty-minded Americans. NRA will continue to monitor these efforts and keep our members apprised of any further developments.

EDITORS NOTE: This column with images by NRA-ILA is republished with permission.

Mass Transit Is a Colossal Government Failure

“Due to moderate gas prices, increasing auto ownership, and the growth of the ride-hailing industry, the nation likely reached ‘peak transit’ in 2014.”

I like subways and spent most of my adult life taking them to work. Unfortunately, most people prefer to drive. It can take an hour and a half to take buses and trains to work for a commute that would take only half an hour by car.

Mass transit is largely a failure and continues to decline despite growing subsidies to many mass transit systems. Light rail systems are white elephants. The money spent on light rail would be better spent on bus lines. The underground corridors used for some subways might better be devoted to self-driving cars.

Randal O’Toole describes just what a failure mass transit is in this country, a failure on every level, in a recent Cato Institute report:

Nationwide transit ridership has declined steadily since 2014, with some of the largest urban areas, including Atlanta, Miami, and Los Angeles, losing more than 20 percent of their transit riders in the last few years. While this recent decline is stunning, it results from a continuation of a century-long trend of urban areas becoming more dispersed and alternatives to transit becoming more convenient and less expensive.

Those trends include a dispersion of jobs away from downtowns and increasing automobile ownership, both of which began with Henry Ford’s development of the moving assembly line in 1913. As a result, per capita transit ridership peaked in 1920 at 287 trips per urban resident per year, and have since fallen to just 38 trips per urbanite in 2017.

Congress began federal subsidies to transit with passage of the Urban Mass Transportation Act of 1964, and since then federal, state, and local governments have spent well over $1 trillion on subsidies aimed at reversing transit’s decline. Yet those subsidies have failed to do more than slow the decline, as the trends that have made transit obsolete and nearly irrelevant to the vast majority of urban Americans have overwhelmed the subsidies….transit carries fewer than 3 percent of commuters to work in half the nation’s 50 largest urban areas, as well as in the vast majority of smaller ones, making transit nearly irrelevant to those regions except for the high taxes needed to support it. Due to moderate gas prices, increasing auto ownership, and the growth of the ride-hailing industry, the nation likely reached “peak transit” in 2014.

The supposed social, environmental, and economic development benefits of transit are negligible to nonexistent. Federal, state, and local governments should withdraw subsidies to transit and allow private operators to take over where the demand still justifies mass transit operations.

His very readable and interesting full report is at this link.

So-called bullet trains generally turn out to be white elephants. South Korea is abolishing its celebrated high-speed rail line from its capital, Seoul, to a nearby major city because it can’t cover even the marginal costs of keeping the trains running. Most people who ride trains don’t need maximum possible speed, and most of those who do will still take the plane to reach distant destinations.

Despite Japan’s much-vaunted bullet trains, most Japanese don’t take the bullet train either; they take buses because the bullet train is too expensive. Bullet trains do interfere with freight lines, so Japanese freight lines carry much less cargo than in the United States, where railroads—rather than trucks—carry most freight, thereby reducing pollution and greenhouse gas emissions.

California’s so-called bullet train is vastly behind schedule and over budget, and will likely never come close to covering its operating costs once it is built. As Reason magazine noted, transportation officials have warned that California’s misnamed “bullet train” is a disaster in the making. California is drastically understating the costs of its high-speed rail project. Just the first leg of this $77 billion project will cost billions more than budgeted. And the project is already at least 11 years behind schedule.

This article is reprinted from Liberty Unyielding.

COLUMN BY

Hans Bader

Hans Bader

Hans Bader practices law in Washington, D.C. After studying economics and history at the University of Virginia and law at Harvard, he practiced civil-rights, international-trade, and constitutional law.

EDITORS NOTE: This column by FEE with images is republished with permission.

VIDEO: The Global Financial Reset – Trump, Money and the Fed

Will Johnson of INFOWARS Interviews John Michael Chambers and Dr. Kirk Elliott. PhD.

EDITORS NOTE: This video is republished with permission. The featured photo is by rawpixel on Unsplash.

Universal Basic Income Is a (Costly) Socialist Pipe Dream

It is the height of hypocrisy to ask the United States government, already USD $22 trillion in debt, to fund handing out free money to the entire nation.

Universal basic income has had a phenomenal year in 2018 when it comes to publicity. Silicon Valley billionaires, academics, and leftist politicians are raving about the brilliant new scheme, which we are told will prevent a Social Darwinist dystopian future in which average Joes everywhere stand to lose their low-functioning blue collar jobs to the grave perils of automation.

Mark Zuckerberg, Facebook CEO and one of the three wealthiest individuals in the world, is a big fan. He has emerged as a high-profile public cheerleader for the universal basic income scheme. During last year’s Harvard commencement address, the fanciful concept featured prominently: “We should explore ideas like universal basic income to make sure that everyone has a cushion to try new ideas.”

Zuckerberg seems to miss something on a basic human nature level. It may be fashionable to promote a philosophy of egalitarianism. The reality, however, is that human beings are not equal in terms of ability or anything else. Under our constitutional system, human beings enjoy equal protection of our constitutional rights, but that hardly means we should expect equality of outcomes. And that is something the Silicon Valley pseudo-socialists will never understand.

It would be nice to believe that a universal basic income program would allow human beings to fully realize their potential. Young people with few opportunities would enjoy the economic freedom to become captains of industry, technological pioneers, and inventors, perhaps learning how to code in their free time, developing software programs, and founding the next major social media platform to compete with Facebook.

To say this is a fanciful notion is an understatement. There are human beings who are highly motivated. There are human beings who are incredibly lazy and unproductive. There are human beings with IQs of 130, and there are human beings with IQs of 70. What message will human beings take away from receiving a monthly check, with no strings attached, for USD $1,000…or $2,000, or $5,000? Will this usher in some golden new age of invention, of technological wonder, of allowing the teeming and downtrodden masses to realize their full potential?

Such a program has never been tried on a large scale, so there are no empirical results, except for small-scale test runs. A basic understanding of human nature, coupled with common sense, however, suggests that the UBI is not the golden panacea that a few starry-eyed Silicon Valley billionaires make it out to be.

Why should we reward human beings for doing nothing? Mark Zuckerberg is the rare technological genius who would spend his free time coding and developing his own social media platform. What about typical human beings? With a check in the mail each month for doing nothing, how many are now going to be “liberated” to work in what they really love, and how many are going to be encouraged to do nothing?

Setting aside human nature, for a moment, let’s take a look at the economics of a UBI program.

Surprise, surprise. They are phenomenally expensive to implement. Just doling out USD $1,000 a month to Americans would cost USD $3.8 trillion a year, according to a recent study by Bridgewater Associates. Well, golly, that’s a tab even Zuckerberg can’t pick up.

National and local governments across the world have been cutting funding for UBI programs in droves. They are expensive and wreak havoc on local budgets. Unsurprisingly, taxpayers (one would presume even of a left-wing bent) don’t take too kindly to funding such pilot programs, especially when they are not the beneficiaries of this state largesse.

Programs in both Canada and Finland have been shut down under political and budgetary pressure, which brings us to the point.

Zuckerberg can champion the idea of a UBI all he wants, but unless he and his Silicon Valley brethren are prepared to fund them personally, they will remain pipe dreams.

Even with an incredibly low-brow American public, ever more eager to get something for nothing through the smoke and mirrors of big government socialism, I believe Americans are intelligent enough to see through the farce of the basic income.

I have no problem with Mark Zuckerberg or other wealthy benefactors funding such programs and showing us their data—holding up the great successes for all the world to see. But it is the height of hypocrisy to ask the United States government, already USD $22 trillion in debt, to fund handing out free money to the entire nation.

This article was reprinted from PanAm Post.

COLUMN BY

David Unsworth

David Unsworth is a Boston native. He received degrees in History and Political Science from Washington University in St. Louis and subsequently spent five years working in real estate development in New York City. 

EDITORS NOTE: This column by FEE with images is republished with permission. The featured image by geralt on Pixabay.

The New Congress Is Here. 4 Debates to Monitor.

Democrats take control of the House of Representatives Thursday, starting a new era of divided government.

Here are four things to watch as the 116th Congress begins Thursday amid a government shutdown.

  1. Tension Between Progressives and Other Democrats

Democrats are set to vote Thursday on a rules package. While it’s supported by incoming House Speaker Nancy Pelosi, it’s already causing waves of opposition among other House Democrats.

The rules package would allow people to keep their religious headwear on in the House chamber as well as prohibit discrimination in regards to gender identity and sexual orientation.

It also contains a “pay-as-you-go” provision. Pay-go  “requires that any new legislation that increases deficits (whether through an increase in mandatory spending or decrease in revenues) must be fully offset by other increases in revenues or decreases in mandatory spending so that the new legislation does not add to the budget deficit,” according to the Peter G. Peterson Foundation.

Both Rep. Ro Khanna, D-Calif., and Rep.-elect Alexandria Ocasio-Cortez, D-N.Y., have said they would vote against the rules package because of the pay-go element.

“I will be voting NO on the Rules package with #PayGo,” Khanna tweeted Wednesday. “It is terrible economics. The austerians were wrong about the Great Recession and Great Depression. At some point, politicians need to learn from mistakes and read economic history.”

After Khanna’s tweet, Ocasio-Cortez also went public with her opposition.

Dani Doane, congressional programs director at The Heritage Foundation, told The Daily Signal in an email that the tension between progressives and other Democrats against Pelosi is only just beginning to surface.

“The challenges to Nancy Pelosi’s speakership will be greater in the 116th Congress compared to her last tenure,” Doane said. “The incoming Democrat class includes a small but vocal wing of hard-core progressives that will cause headaches across the Congress in their efforts to drag America to the left.”

But according to Pelosi’s daughter, she’s not one to flinch from fights.

Talking about her mother’s leadership style, Alexandra Pelosi, a filmmaker, told CNN Wednesday, “She’ll cut your head off and you won’t even know you’re bleeding.”

“That’s all you need to know about her.”

2. Will Mitt Romney Be ‘a Flake’?

After Mitt Romney published an op-ed in The Washington Post on Tuesday voicing his disappointment in the Trump administration and saying his presidency made a “deep descent,” last month, Trump fired back at Romney Wednesday.

“Here we go with Mitt Romney, but so fast,” Trump tweeted. “Question will be, is he a Flake? I hope not. Would much prefer that Mitt focus on border security and so many other things where he can be helpful. I won big, and he didn’t.”

Republican Sen. Jeff Flake, who chose not to run for re-election in 2018, was often very critical of Trump. The Arizona senator has said the president “cannot take criticism,” and “is charting a very dangerous path” for the country. Flake also refused to confirm judicial nominees at the end of 2018 unless the Senate had a vote on a bill that would protect special counsel Robert Mueller.

In an interview on “Fox & Friends” Wednesday, former House Speaker Newt Gingrich said he thinks Romney’s issue with Trump is personal.

“I can’t figure out why, strategically, he thought that was helpful to him. … I think Romney would like to be president now,” Gingrich said.

“Stylistically, they’re so different. I suspect every morning when Romney gets up he gets angry, just because Trump is so different than he is.”

Romney’s new colleague, Sen. Rand Paul, R-Ky., also weighed in with a tweet Wednesday:

3. Will Trump Get His $5 Billion for the Wall?

Trump is blaming the shutdown, which started at midnight on Dec. 21, on the Democrats.

“We are in a shutdown because Democrats refuse to fund border security,” Trump said Wednesday.

He also tweeted Wednesday that the “$5.6 billion dollars that House has approved is very little in comparison to the benefits of national security,” and that the country would see a “quick payback” if given funding for the wall.

During part of an interview released Wednesday with NBC’s Savannah Guthrie, House Democratic Leader Nancy Pelosi promised “nothing for the wall.”

NEW: “We can go through the back and forth. No. How many more times can we say no? Nothing for the wall,” Rep. Pelosi tells @SavannahGuthrie amid the government shutdown, as Democrats prepare to retake control of the House on Thursday.4,3904:18 PM – Jan 2, 20191,911 people are talking about thisTwitter Ads info and privacy

4. More Investigations Into Trump

Rep. Adam Schiff, D-Calif., the next chairman of the House Intelligence Committee, has promised to investigate Trump regarding “illicit foreign funding or involvement in the inauguration,” per The Washington Post,

“Whenever a foreign nation uses its financial wealth to violate the laws of our country, it undermines our democracy,” Schiff said in a December statement. “When another country does so in concert with U.S. persons, it carries the additional risk of compromising them and presents a particularly acute counterintelligence risk.”

Schiff even went so far as to say Trump could potentially spend time in jail.

“There’s a very real prospect that on the day Donald Trump leaves office, the Justice Department may indict him. … He may be the first president in quite some time to face the real prospect of jail time,” Schiff said Dec. 9 on “Face the Nation.”

Rep. Elijah Cummings, who will head the House Oversight and Government Reform Committee, said Trump needs more accountability.

“Right now, we have a president who is accountable to no one,” Cummings, D-Md., told CNN.

COLUMN BY

Portrait of Rachel del Guidice

Rachel del Guidice

Rachel del Guidice is a reporter for The Daily Signal. She is a graduate of Franciscan University of Steubenville, Forge Leadership Network, and The Heritage Foundation’s Young Leaders Program. Send an email to Rachel. Twitter: @LRacheldG.

The Daily Signal depends on the support of readers like you. Donate now

EDITORS NOTE: This column with images by The Daily Signal is republished with permission. Photo: Carlos Barria/Reuters /Newscom.

Why California’s 1% Dip in Homelessness Is No “Success Story”

If my friends on the left see this as an example of success, I’d hate to see their definition of failure.

I often write about the failure of government.

In other words, there’s lots of evidence that government spending makes things worse.

Needless to say, this puts a lot of pressure on folks who favor bigger government. They desperately want to find any type of success story so they can argue that increasing the size and scope of the public sector generates some sort of payoff.

And they got their wish. Check out the ostensibly good news in a story from the San Fransisco Chronicle:

Investing billions of dollars in affordable housing and homeless programs in recent years has apparently put the brakes on what had been a surge in California’s homeless population, causing it to dip by 1 percent this year, a federal report released Monday showed. …The report put California’s homeless population this year at 129,972, a drop of 1,560 in the number of people on the streets in 2017. …“I think San Francisco has shown that when targeted investments are made, we see reductions in homelessness here,” [Jeff Kositsky, head of the city’s Department of Homelessness and Supportive Housing], said. He pointed out that family, youth and chronic veterans homelessness dropped in the city’s last full count — although the number of chronically homeless people went up.

Maybe I’m not in the Christmas spirit, but I don’t see this as a feel-good story.

Are we really supposed to celebrate the fact that the government spent “billions of dollars,” and the net effect is that the homeless population dropped just 1 percent?

The story doesn’t contain enough details for precise measurements, but even if we assume “billions” is merely $2 billion, then it cost taxpayers close to $1.3 million to get one person off the street. For that amount of money, taxpayers could have bought each of them a mansion!

In other words, the program has been a rotten investment. Heck, it makes Social Security seem like a good deal by comparison.

To be sure, maybe the number isn’t quite so bad because we’re comparing multi-year outlays with a one-year change in the homeless population, though it’s possible the number is even worse because taxpayers actually coughed up far more than $2 billion.

The bottom line is that if my friends on the left see this as an example of success, I’d hate to see their definition of failure.

This article was reprinted with permission from International Liberty.

COLUMN BY

Daniel J. Mitchell

Daniel J. Mitchell

Daniel J. Mitchell is a Washington-based economist who specializes in fiscal policy, particularly tax reform, international tax competition, and the economic burden of government spending. He also serves on the editorial board of the Cayman Financial Review. 

EDITORS NOTE: This column by FEE, with images, is republished with permission. Image credit: Pixabay

Advertisers Cower as Libs Gin up Attacks on Tucker Carlson

“Approximately 20” companies have caved to pressure from liberal groups and pulled or suspended advertising from Tucker Carlson’s Fox News show after the host’s recent statements about immigration:

“We have a moral obligation to admit the world’s poor they tell us, even if it makes our own country poorer, and dirtier, and more divided,” he said at the start of his program last week. “Immigration is an act of atonement. Previous leaders of our country committed sins. We must pay for those sins by welcoming an endless chain of migrant caravans.”

While many immigrants seek the American Dream, policies that encourage illegal immigration such as open borders and sanctuary cities undermine the rule of law. Furthermore, unchecked immigration is an invitation for chaos and a significant detriment to the social fabric of our nation — for example, the higher serious crime rates by illegal immigrants as compared to native-born Americans and legal immigrants.

Not surprisingly, the campaign to push companies away from Carlson’s show is led by leftist hack website Media Matters — an organization funded by liberal billionaire George Soros. According to Media Matters, advertisements on a network covering a different viewpoint on immigration policy amounts to “sponsoring fascism.” Of course, Pacific Life, who is “pausing” ads, continues to support pro-abortion organizations, while Media Matters convenient ignores the historical role of abortion in the eugenics philosophies promulgated by real, actual fascists. The abortion industry is also complicit in enabling human traffickers who prey on vulnerable immigrants.

Do companies like Pacific Life support the abortion industry’s attack on immigrants? The virtue signaling over Carlson’s comments is outrageously hypocritical when corporate bank accounts directly fund the destruction of life, particularly in immigrant communities. This means 2ndVoters must work harder to engage these companies through direct contact and by holding them accountable with your dollars.

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EDITORS NOTE: The column with images by 2ndVote is republished with permission. The featured photo is from Shutterstock.

What Would Actually Be Affected in a Government Shutdown

“Government shutdown.” Probably no two words strike more fear in the hearts of Washington politicians.

The fact that another shutdown is imminent is a sign of how dysfunctional Washington’s budgeting process really is. What was once an orderly process where timelines were largely met has morphed into a political game plagued by brinkmanship and out-of-control spending.

Despite promises from Congress that the process would be different this year, here we are again.

This time the biggest issue holding up a deal is a confrontation between President Donald Trump and congressional Democrats over border security funding.

As Congress barrels toward a Friday spending showdown, the potential of a partial government shutdown is very real. But what would it actually mean?

A shutdown wouldn’t be good, of course, but it’s not as scary as you think. There wouldn’t be lawlessness in the streets. You’d still get your Social Security check.

Here’s what a shutdown and an alternative might look like:

Government Shutdown

If Congress and the president are unable to reach an agreement by Friday, then the federal government will enter into a partial shutdown. Five of 12 annual spending bills became law in September. That includes the military, so there is no threat to national defense.

It also includes the departments of Labor, Health and Human Services, Interior, and Veterans Affairs. In fact, 75 percent of the discretionary budget has already been funded through September 2019.

Still, a partial shutdown would mean that major federal agencies such as the departments of Agriculture, Commerce, Justice, Homeland Security, State, and Transportation would be left without funding.

Many of the services they provide, however, would not be interrupted. Four hundred and twenty thousand “essential” federal employees would continue to work, including 41,000 law enforcement and correctional officers and up to 88 percent of DHS employees. America’s safety would not be sacrificed.

You shouldn’t worry about your benefit payments being impacted either. Social Security, Medicare, and Medicaid payments, as well as veterans benefits, would continue uninterrupted. These programs don’t rely on Congress taking action for annual funding to continue, or their appropriations were already passed into law.

Mail service would also continue as scheduled since the Postal Service has its own revenue stream. National parks would remain open, though with reduced staff.

About 380,000 federal employees would be furloughed for the duration of a shutdown, meaning that they wouldn’t be paid nor expected to work. Agencies that would be most affected include the Department of Commerce, NASA, the IRS, and the Department of Housing and Urban Development. Based on past government shutdowns, all furloughed employees would likely be paid when the shutdown ends.

A Continuing Resolution

Another possible outcome to get around the current funding impasse is for Congress to pursue a continuing resolution to keep the government open. That scenario played out as the last funding deadline approached on Dec. 7.

Under this situation, agencies would operate at their 2018 budget levels for the duration of the continuing resolution. Congress could choose to extend funding for a short period of time (likely into early 2019) or could opt for a full-year continuing resolution.

If Congress passes a short-term continuing resolution, then it would be back in the same mess in just a few short weeks.

Passing a full-year continuing resolution would put an end to the budget drama for this year. However, it would also leave both Republicans and Democrats unsatisfied, with Trump not getting additional border security money and Democrats unable to enact some of their priorities.

But it would save taxpayers money. If unfunded agencies simply continued to receive money at the 2018 level, it would cut spending by $11 billion.

It’s not a lot, but with the national debt soon expected to cross $22 trillion, every penny counts.

Regardless of what happens, one thing is clear: The budget process is broken, and taxpayers are the real losers. When Congress is constantly budgeting by crisis, it erodes oversight and leads to wasteful spending. Citizens should demand that Congress not only make the budget process better, but also ensure a sustainable budget future.

The cost of failing to do that is much scarier than a government shutdown.

Originally Distributed by Tribune News Service

COMMENTARY BY


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EDITORS NOTE: This column with images by The Daily Signal is republished with permission. The featured photo is by Vadim Sherbakov on Unsplash.