Hiding the Cost of Government Leads to Bigger Government | Christopher J. Conover | Cato Institute: Commentary

Hiding the Cost of Government Leads to Bigger Government | Christopher J. Conover | Cato Institute: Commentary: "When the federal government takes an additional dollar from taxpayers, the actual cost to society is generally $1.44. That extra 44 cents represents the deadweight loss of taxation. Every time Congress shifts another dollar from Peter to Paul, it leaves society 44 cents poorer.

The deadweight loss of taxation can be much higher, though. For example, if Congress allows income-tax rates to rise in January, as current law provides, it will cost society $1.50 for every dollar of new tax revenue. Feldstein estimates that each dollar of new income-tax revenue could cost society $2.65!"

"University of Chicago economist Harald Uhlig estimates that federal borrowing carries a much higher deadweight loss, such that every $1 of deficit spending ultimately costs society $4.40."

"The Office of Management and Budget already directs federal agencies to include the deadweight costs of federal taxes when doing cost-benefit analyses of federal spending. Congress should do the same."

Keeping the Poor in Poverty | Michael D. Tanner | Cato Institute: Commentary

Keeping the Poor in Poverty | Michael D. Tanner | Cato Institute: Commentary: "For example, few things are as important in helping people escape poverty as education."

"Yet Obama and the Democrats, in thrall to the teachers' unions, steadfastly resist proposals to give parents more control over their children's education. Washington, D.C., has a public-school system that, despite spending more per child than almost any other system in the nation, still has a dropout rate of more than 50 percent. Yet one of the first actions of the president and congressional Democrats was to kill the Opportunity Scholarship Program, which offered vouchers to permit poor children to opt out of the city's rotten public schools.

Across the country, efforts to increase parental choice are met with a wall of Democratic obstructionism. Choice, we are told, is a threat to the 'education system.' But which is really more important, the 'education system' or poor children?

And, of course, nothing is more important in fighting poverty than jobs. Yet the Obama administration is overtly hostile to the entrepreneurs and job creators in our economy. The wealthy are demonized rhetorically."

"We can't expect to create more jobs if we punish the type of activity that creates jobs. That means that if we wish to fight poverty, we must end those government policies — high taxes and regulatory excess — that inhibit growth and job creation. We must protect capital investment and give people the opportunity to start new businesses.

Along similar lines, one of the great advantages to reforming Social Security with personal accounts is that it would enable low-income Americans to save and accumulate wealth. But don't count on Democrats to lessen their opposition to the idea."

"Compassion is more than talking about the plight of the poor or giving them just enough money to make poverty a bit more comfortable. Real compassion is about creating the conditions that will enable the poor to get out of poverty."

For Orderly Dissolution of the Fed, before It Does Us Even More Harm | Jim Powell | Cato Institute: Commentary

For Orderly Dissolution of the Fed, before It Does Us Even More Harm | Jim Powell | Cato Institute: Commentary: "The Fed was established 97 years ago, and Fed officials were given considerable power over the economy as if they knew what they were doing, but they didn't. They're still winging it today.

The Fed failed its first big test in 1920 when the end of World War I was followed by the sharpest depression on record. Wholesale prices plunged more than 50%, the economy contracted by almost 24%, and unemployment doubled to 11%. This was the kind of crisis the Fed was supposed to prevent."

"in 2002, Ben Bernanke, then a Fed governor, acknowledged the Fed's role in these calamities: 'We did it. We're very sorry. We won't do it again.'"

"Intended to save our economy, the Fed has turned out to be perhaps the biggest single source of economic instability. It's the big pig at the trough, and it's unpredictable. It doesn't follow any rules consistently. When it moves, everyone else can be badly knocked around.

The very unpredictability of the Fed causes uncertainty that discourages investors and employers from making commitments for the future — an important reason why we're experiencing a sluggish, jobless recovery now.

Theoretically, the Fed might be able to work if there were perfect people, but there don't seem to be any of those around. After almost a century of the Fed's often violent roller-coaster rides, it's hard to see what might be accomplished with one more bit of tinkering such as with interest-rate targets.

It's time to begin planning for an orderly dissolution of the Fed before it does us any more harm."

No More Waiting for Superman | Neal McCluskey | Cato Institute: Commentary

No More Waiting for Superman | Neal McCluskey | Cato Institute: Commentary: "the ruin wreaked by socialized education is everywhere. Our best students do poorly compared to children in other developed nations — countries which, by the way, often embrace school choice. Worse, poor children are frequently locked into intellectual dungeons because their families are unable to afford a private school, or a house in a better district."

"Where we let freedom work, we have affordable abundance: from food, to iPods to automobiles. To get access to a decent school, in contrast, we force children to swarm around Bingo hoppers and pray that theirs will be among the few numbers called."

Tariffs Benefit Few, at Cost to All | Daniel J. Ikenson | Cato Institute: Commentary

Tariffs Benefit Few, at Cost to All | Daniel J. Ikenson | Cato Institute: Commentary: "A steel tariff of 20 per cent, for example, might enable domestic producers, through higher prices and greater market share, to increase profits by an aggregate $100 million a year. However, the typically larger costs associated with a steel tariff are borne by a mostly unwitting public, whose incentives to lobby against the tariffs are muted by the fact that those large costs are spread across millions of consumers. These costs include: higher prices for automobiles, appliances, housing, and transportation; lost export sales on account of foreigners having fewer exchange dollars or because of trade retaliation; and forgone opportunities to grow businesses that require affordable steel."

Homeowners say loan mods led them to foreclosure - FoxNews.com

Homeowners say loan mods led them to foreclosure - FoxNews.com: "the loan modification disputes are a legacy of the federal government's rush to stem the flow of foreclosures before it had adequate plans in place.

'These policymakers said, just go out and do this and don't let us worry about the details,' he said. 'These details are now what are coming to the fore in these modification cases.'

Laurie Maggiano, policy director at the Treasury Department's Homeownership Preservation Office, said banks were encouraged to offer trial modifications based on interviews with borrowers about their incomes and expenses while they sorted out the paperwork to qualify for permanently reduced payments."

"Casco said his monthly mortgage payments to Washington Mutual Inc. went up to $2,765 when he refinanced his home in 2006 to pay for a new a meat counter at his store in the industrial Los Angeles suburb of South Gate.

Chase was in the process of acquiring Washington Mutual in January 2009 when Casco said it sent a note telling him he qualified for a lower forbearance rate. The El Salvador native sent the tax returns and business documents the bank was requesting.

His payment was reduced to $1,250, where it remained for several months until Chase told him to apply for a trial loan modification.

Again, Casco said, he sent Chase the documentation they requested. His payment rose to $2,363 in June, then returned to the forbearance rate in October.

Casco said he continued paying what he was asked until August 2010, when Chase told his family that they were $50,000 behind on their payments and put them into foreclosure."

The Impossibility of an Informed Electorate - D.W. MacKenzie - Mises Daily

The Impossibility of an Informed Electorate - D.W. MacKenzie - Mises Daily: "However, even those who follow politics very closely do not understand the implications of changes in public policy. The lesson here is that efforts to incrementally reform government policies and programs through the democratic process are futile. To the extent that we vote at all, rational people should vote to depoliticize the economy."

Kind slips past Kapanke to retain seat

Kind slips past Kapanke to retain seat: "Kapanke said it was easier to lose on a night when his party regained control of the U.S. House as well as both chambers of the state legislature.
“It was never about me,” he said. “The country’s in better hands. The state is in better hands.”"

"Outside interest groups targeted the largely agricultural district with an unprecedented level of spending — almost exclusively on the right — bankrolling attacks on Kind."

According to http://www.opensecrets.org/races/summary.php?cycle=2010&id=WI03 Kind received over $1,000,000 in PAC money (compared to $55,000 for Kapanke) -- that doesn't count "soft money" but it sounds like Kind got a lot of money from "Outside interest groups".

The GOP Must Fight Earmarks | Michael D. Tanner | Cato Institute: Commentary

The GOP Must Fight Earmarks | Michael D. Tanner | Cato Institute: Commentary: "It is worth remembering that Ronald Reagan once vetoed a highway bill because it contained 152 earmarks, which he called 'a textbook example of special-interest politics at work.' Twenty years later, Republicans managed to put together a highway bill that contained 6,371."

"Many of the scandals that beset the last GOP Congress were the result of earmarks."

"earmarks are part and parcel of the deal-making and horse-trading that greases the skids for so much bad legislation in Washington. Vote against the leadership's pet legislation and your earmark gets cut off; vote for it and your district gets some delicious pork. And nothing helps an otherwise terrible bill gather votes better than stuffing it full of earmarked goodies for wavering lawmakers. Therefore, even a very small earmark can be used to leverage far more costly government spending."

"earmarks crowd out local private-capital investment and research-and-development spending, thereby slowing economic growth."

"If Republicans can't end earmarks, how can we expect them to make hard decisions when it comes to something like entitlements?"

Postal Bankruptcy | Doug Bandow | Cato Institute: Commentary

Postal Bankruptcy | Doug Bandow | Cato Institute: Commentary: "The USPS is in crisis. It is locked in a declining market. It can only survive with indirect taxpayer subsidies and a ban on private competition. Instead of forcing Americans to pay more for less service, Congress should open mail delivery to all comers.

The Constitution authorizes Congress "To establish Post Offices." But Congress is not required to institute government mail delivery, let alone a public mail monopoly. Today there is competition only in packages and urgent delivery. For regular mail, you must use the USPS, or else."

"the post office threatened to sue Boy Scouts who proposed delivering Christmas cards during the holidays. When the USPS learned of companies sending international mail abroad with traveling employees, it demanded payment for services not rendered."

"Years ago Australia, Germany, Finland, the Netherlands, New Zealand, and Sweden liberalized their postal regimes. The result, reported the OECD, was 'quality of service improvements, increases in profitability, increases in employment and real reductions in prices.' Since then the European Union has pushed continent-wide liberalization, especially by reducing the forms of mail "reserved" to government operations."

"the system remained bounded by regulations, cushioned by subsidies, and protected by its monopoly. In particular, USPS is exempt from taxes, regulations, and even parking tickets. Nevertheless, since 1971 the post office has lost money in 24 of 38 years."

"The average USPS salary is $83,500, which makes postal employees among the highest paid semi-skilled workers around."