Big Government, Big Recession | Alan Reynolds | Cato Institute: Commentary

Big Government, Big Recession | Alan Reynolds | Cato Institute: Commentary: "Proponents of Big Government can't say we avoided the next Great Depression due to hypothetical stimulus money that is mostly unspent. So they argue it's more important that the federal government merely continued spending and didn't 'slash' spending as in the early 1930s. But the federal government didn't slash spending in the early '30s. Federal spending rose by 6.2% in 1930, 7.7% in 1931 and 30.2% in 1932. Since prices were falling, real increases in federal spending were huge during the Hoover years.

President Obama clearly believes Big Government is the antidote to this and perhaps all recessions. At his first news conference in February, the president said, 'The federal government is the only entity left with the resources to jolt our economy back to life.' Yet that raises a key question: If the U.S. economy could not recover without a big 'jolt' of deficit spending, then how did the economy recover from recessions in the distant past, when the federal government was very small?"

"A 1999 study in The Journal of Economic Perspectives by Christina Romer (now head of the Council of Economic Advisers) found that "real macroeconomic indicators have not become dramatically more stable between the pre-World War I and post-World War II eras, and recessions have become only slightly less severe." Ms. Romer also noted that "recessions have not become noticeably shorter" in the era of Big Government. In fact, she found the average length of recessions from 1887 to 1929 was 10.3 months. If the current recession ended in August, then the average postwar recession lasted one month longer — 11.3 months. The longest recession from 1887 to 1929 lasted 16 months. But there have been three recessions since 1973 that lasted at least that long.

The relative brevity of recessions before the New Deal is particularly surprising since the U.S. economy was then dominated by farming and manufacturing — industries far more prone to nasty cyclical surprises than today's service-based economy."

"Yet recessions after the Fed was created soon turned out to be much deeper than before (1920-21, 1929-33, 1937-38) and often more persistent.

It's clear that U.S. history does not support the theory that Big Government means shorter and milder recessions. In reality, recessions always ended without government prodding, long before anyone heard of Keynes and long before the Fed existed. What's more, recessions ended more quickly before the New Deal's push for Big Government than they have in the past three decades. The economy's natural recuperative powers before the 1930s proved superior to recent tinkering by Big Government economists, politicians and central bankers."

Frank Says House Will Likely Approve Audit of Federal Reserve - Political News - FOXNews.com

Frank Says House Will Likely Approve Audit of Federal Reserve - Political News - FOXNews.com: "Rep. Barney Frank, the chairman of the House Financial Services Committee, has endorsed a bill calling for an audit of the Federal Reserve.�

The support from the powerful Massachusetts Democrat comes after the measure, introduced in late February by Rep. Ron Paul, has won hundreds of co-sponsors on both sides of the aisle.�"

Medical-imaging procedures always worth the risk? | Health Tech - CNET News

Medical-imaging procedures always worth the risk? | Health Tech - CNET News: "CT scans alone are up four-fold, according to the study. These 'worrisome' radiation doses--as many as 2 percent of cancers could be attributed to radiation during CT scans alone--justify more rigorous scientific scrutiny, according to lead investigator Dr. Reza Fazel at the Emory University School of Medicine in Atlanta:
Unlike the exposure of workers in health care and the nuclear industry, which can be regulated, the exposure of patients cannot be restricted, largely because of the inherent difficulty in balancing the immediate clinical need for these procedures, which is frequently substantial, against the stochastic risks of cancer that would not be evident for years, if at all."

Gun Owners' Next Victory in D.C. | Robert A. Levy | Cato Institute: Commentary

Gun Owners' Next Victory in D.C. | Robert A. Levy | Cato Institute: Commentary: "Does the Constitution mandate that the nation's capital allow firearms to be carried outside the home? The right to bear arms, the court said in Heller, is an 'individual right unconnected to militia service.' To 'bear' means to 'carry.' More specifically, when used with 'arms,' the opinion said, 'bear' means 'carrying for a particular purpose — confrontation.' Nothing in that formulation implies a right that can be exercised only within one's home.

Indeed Justice Ruth Bader Ginsburg, although she dissented in Heller, cited Black's Law Dictionary to suggest in a prior opinion that the Second Amendment entails a right to 'wear, bear, or carry ..... upon the person or in the clothing or in a pocket, ..... armed and ready ..... in a case of conflict with another person.' That language, says Michael O'Shea in the West Virginia Law Review, 'reads like a literal description of the practice of lawful concealed carry, as engaged in by millions of Americans in the forty-eight states that authorize the carrying of concealed handguns.'"

My Summer Reading: Hyper-Inflation in Weimar Germany - Ralph Fucetola - Mises Institute

My Summer Reading: Hyper-Inflation in Weimar Germany - Ralph Fucetola - Mises Institute: "The historical setting for Graham's study tale begins with the end of the First World War. The armistice was engendered by the complete exhaustion of the warring parties. Then came the peace treaty with its assignment of 'guilt' for the war to the Central Powers, and the imposition of heavy reparations. The Allies seized nearly the entire German merchant marine and nearly all the railroad rolling stock. Gold-mark reparations were also imposed."

How to Deal With North Korea | Doug Bandow | Cato Institute: Commentary

How to Deal With North Korea | Doug Bandow | Cato Institute: Commentary: "The North has now formally invited the U.S. to send an envoy for negotiations. How to respond? Seven steps would help the U.S. promote peace and stability on the Korean Peninsula.

1. Keep expectations low.

4. Treat North Korean provocations with bored contempt. The U.S. needs to reward the North when it acts responsibly and punish or ignore it when it acts badly. Reprogramming the DPRK won't be easy, but the regime has been on markedly better behavior over the last month than previously. For that Washington and other nations should respond favorably.

5. Let other countries, which have the most at stake, take the lead. The DPRK is primarily a problem for its neighbors, not the U.S. The North's antiquated military has only limited reach. A messy DPRK regime collapse would loose refugees on South Korea and China, not America."

Free the Mails | Chris Edwards and Tad DeHaven | Cato Institute: Commentary

Free the Mails | Chris Edwards and Tad DeHaven | Cato Institute: Commentary: "Yet another giant company has plunging sales, soaring debt, and is weighed down by massive labor costs. Will taxpayers have to pay for another federal bailout? Alas, it's already in the cards because this company is the U.S. Postal Service, which has estimated losses of $7 billion this year."

Massachusetts' Obama-like Reforms Increase Health Costs, Wait Times | Michael F. Cannon | Cato Institute: Commentary

Massachusetts' Obama-like Reforms Increase Health Costs, Wait Times | Michael F. Cannon | Cato Institute: Commentary: "If you are curious about how President Barack Obama's health plan would affect your health care, look no farther than Massachusetts. In 2006, the Bay State enacted a slate of reforms that almost perfectly mirror the plan of Obama and congressional Democrats.

Those reforms reveal that the Obama plan would mean higher health insurance premiums for millions, would reduce choice by eliminating both low-cost and comprehensive health plans, would encourage insurers to avoid the sick and would reduce the quality of care."

"The most sweeping provision in the Massachusetts reforms — and the legislation before Congress — is an "individual mandate" that makes health insurance compulsory. Massachusetts shows that such a mandate would oust millions from their low-cost health plans and force them to pay higher premiums.

The necessity of specifying what satisfies the mandate gives politicians enormous power to dictate the content of every American's health plan — a power that health care providers inevitably capture and use to increase the required level of insurance.

In the three years since Massachusetts enacted its individual mandate, providers successfully lobbied to require 16 specific types of coverage under the mandate: prescription drugs, preventive care, diabetes self-management, drug-abuse treatment, early intervention for autism, hospice care, hormone replacement therapy, non-in-vitro fertility services, orthotics, prosthetics, telemedicine, testicular cancer, lay midwives, nurses, nurse practitioners and pediatric specialists.

The Massachusetts Legislature is considering more than 70 additional requirements.

Those requirements can increase premiums by 14 percent or more. Officials further increased premiums by imposing new limits on cost-sharing."

"One way insurers can avoid the $50,000 patients is to drop benefits those customers find attractive. Shelby Rogers is a 12-year-old girl with spinal muscular atrophy, whose parents chose an Aetna plan through the price-controlled health insurance exchange for federal workers. Last year, Aetna announced it would drop coverage for Shelby's 12-hour-a-day nurse, who, among other things, helps Shelby avoid bedsores by turning her over at night. An Aetna spokesman explained the reason was to avoid offering a benefit that causes the sickest patients to flock to the plan.

Over time, as mandates eliminate low-cost options and price controls eliminate comprehensive options, both the Massachusetts and Obama reforms will march consumers into a narrow range of health plans.

As goes choice, so goes quality. Statistics on waiting times for specialist care in Massachusetts read like a dispatch from Canada. In 2004, Boston already had the longest waits among metropolitan areas. By 2009, waits had generally shortened in other metro areas (average wait: less than three weeks) but lengthened in Boston (average wait: seven weeks), according to the Merritt Hawkins survey."

"Massachusetts has reduced the share of its population that lacks coverage from an estimated 8.3 percent in 2006 to an estimated 2.6 percent by June 2008. Former Gov. Mitt Romney, a Republican who signed the Massachusetts reforms into law, boasts that "no other state has made as much progress in covering their uninsured."

Yet that achievement carries an exorbitant price tag: at least $2.1 billion this year, according to the Massachusetts Taxpayers Foundation, a figure that doesn't even include the cost of the additional coverage discussed above. Since Massachusetts has covered just 432,000 previously uninsured residents, the cost of covering a previously uninsured family of four — at least $20,000 — is well above the average cost of an employer-sponsored family policy (about $13,000)."

Voting until They Get It Right in the European Union | Doug Bandow | Cato Institute: Commentary

Voting until They Get It Right in the European Union | Doug Bandow | Cato Institute: Commentary: "When it comes to the European Union, any vote to increase authority in Brussels is viewed as final. Any vote against consolidating power is treated as merely temporary.

The Lisbon Treaty is the perfect example of such a power grab. Among other things, it shifts responsibilities from national parliaments to European parliament, reduces the number of areas where unanimity is required (eliminating national vetoes), creates a president as a person (as opposed to rotating presidencies for nations) and creates a foreign minister to push a continental foreign policy.

In June 2008, Ireland voted against the treaty. Since the agreement requires unanimous support, the referendum theoretically killed the attempt. However, the European elite insisted that Ireland vote again. Dublin will hold a revote Oct. 2."

"Spanish EU Commissioner Joaquin Almunia claimed that it's not "very democratic" to hold a referendum on complicated issues like the Lisbon Treaty. German Interior Minister Wolfgang Schaeuble declared, "A few million Irish cannot decide on behalf of 495 million Europeans.""

The Second American Revolution | Nat Hentoff | Cato Institute: Commentary

The Second American Revolution | Nat Hentoff | Cato Institute: Commentary: "'For generations, we doctors have promised our patients that medical advances will allow us all to live longer, more comfortable lives. Now that these results are finally arriving, 'health-care reform' — or 'insurance reform' (as our would-be health czar now calls it) — could snatch the rug out from under us.'

If the president succeeds in having Congress enact into law a national federal council to decide the most cost-effective medical care, those national standards will necessarily override which specific care can be most effective for each individual patient. Is expressing that concern, even loudly — about being lost in the abstract whole — what House Speaker Nancy Pelosi calls 'un-American' as she scorns these citizen eruptions by latter-day sons and daughters of liberty?"