Friday, January 27, 2017

The Case against Public Schooling

By Neal McCluskey

To hear her opponents, you’d think school-choice-supporter Betsy DeVos, President-elect Trump’s pick for secretary of education, would banish mothers, apple pie and baseball to a desert island. Her opponents suggest public schools (aka government schools) are just as essential to American culture.
Evidence begs to differ.
Soon after DeVos was nominated, Randi Weingarten, president of the American Federation of Teachers, took to the pages of the New York Daily News to preach doom. She proclaimed DeVos is “a grave threat” to the public schools “that made America great.” She wrote that those schools are “the places where we prepare the nation’s young people…to contribute. They are where we forge a common culture out of America’s rich diversity.”

Top 10 Ways Obama Violated the Constitution during His Presidency

By Ilya Shapiro

The Obama administration has been the most lawless in U.S. history. I don’t mean that in the Nixonian sense of personal corruption, whereby the president is personally above the law, although the idea that Barack Obama’s tenure has been ethically pure is laughable.
No, my accusation rests on the 44th president’s seeing himself as professionally above the law, ignoring the executive branch’s legal limits and disrespecting constitutional bounds like federalism and the separation of powers.

Trump Calls House GOP Tax Plan ‘Too Complicated.’ He May Be Right.

By Daniel J. Mitchell

The hot new term in the world of tax reform is “border adjustability,” which refers to when governments have systems that tax imports and exempt exports.
This approach is widely associated with European-style credit-invoice, value-added taxes (VATs), and Republicans appear poised to bring something similar to our shores.
As part of their “Better Way” tax plan, House Republicans are proposing to change the corporate income tax into a destination-based, cash-flow tax (DBCFT), which in itself is a kind of border-adjustable tax.

Trump’s Protectionism Isolates US on Global Stage, Emboldens China

By Christine Guluzian

Chinese President Xi Jinping’s address at the World Economic Forum in Davos, Switzerland Tuesday may have sent the strongest signal yet that China is more willing than the United States to champion free trade and globalization, thanks to President Donald Trump’s protectionist and anti-trade leanings.
At the commencement of the WEF’s annual summit, Xi — the first Chinese head of state to participate in Davos — spoke of the importance of globalization for global economic growth, whereas President Trump’s representative at Davos, Anthony Scaramucci, spoke of America’s centrality as indispensable for globalization.

Inauguration Speech Wrongly Demonized Free Trade

By Simon Lester

Picking up where he left off during the presidential campaign, President Trump made economic nationalism a central theme of his inauguration speech. Using dark language and imagery, he referred to shuttered factories and workers left behind, and asserted that from now on it will be “America First.”

Trump Is Wrong: Protectionism Leads to Misery, Not Prosperity

By Ryan Bourne

Donald Trump tore up the broad consensus on international free trade with a miserable, protectionist inaugural speech on Friday. So explicit was his outlook that those of us who had become complacent about his economic impact — the “how bad can he be?” crowd — have had to sit up and reassess.
In a pugnacious passage, he claimed: “Every decision on trade… will be made to benefit American workers and American families. We must protect our borders from the ravages of other countries making our products, stealing our companies, and destroying our jobs. Protection will lead to great prosperity and strength.”

Is Trump Serious about Cutting the Deficit and the National Debt?

By Michael D. Tanner

Even before President Trump was sworn in, Washington was abuzz with leaks about his coming budget. According to some reports, he would propose as much as $10.5 trillion in cuts over the next ten years. Among the cuts would be programs that have long been examples of wasteful, unnecessary, or counterproductive spending, including the Corporation for Public Broadcasting, the National Endowment for the Arts, and the Legal Services Corporation. The budgets for agencies such as the Departments of Energy and Commerce would be slashed. Conservatives would swoon.

Goodbye Susan Rice, Hello National Security Options

By Doug Bandow

National Security Adviser Susan Rice needs a long rest. She recently stated that she didn’t “have the luxury of focusing on” only three nations, as suggested by the Washington Post in an interview. After a reporter (presumably jokingly) asked about Canada, she replied that it was one of the few countries on the planet that she didn’t bother to stress over.
It is hard to imagine how tired she must be. The planet is large. It has about two hundred nations. That means she must be worried about, oh, at least 180 or 190 countries, depending on her definition of “few.” That would keep even the calmest person in a frenetic state.

Obama’s Mixed Legacy on Immigration

By Alex Nowrasteh

Immigration was the biggest policy issue in the 2016 presidential campaign, and President Obama’s actions during his eight years in office are what set the stage.
But Obama’s immigration legacy is a complex one. On the one hand, he is the harshest enforcer of immigration laws in American history, deporting more illegal immigrants than any previous administration. On the other hand, his executive actions have also helped shield from deportation some 750,000 unauthorized immigrants who were brought here as children.
What lessons can we draw from Obama’s mixed legacy on immigration?

The Tug of War on ISIS inside Donald Trump’s Head: Does He Escalate or Avoid What Is Likely to Be a Counterproductive War?

By A. Trevor Thrall

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Now in office, it’s time for President Trump to deliver on his campaign promises. A critical one will be his promise to destroy the Islamic State. CNN recently reported that the Pentagon has already developed a set of options for Trump to review, purportedly including significantly increased American military forces and the deployment of thousands of ground troops.

Divining the Emerging Trump Doctrine

By A. Trevor Thrall

Donald Trump has now officially taken over the reins of American foreign policy, after having done so less officially (mostly via Twitter) during the transition. Prediction is a dangerous game, and, as many observers have noted, Trump’s comments on foreign policy have been anything but consistent thus far.
Even so, I think we can discern the broad outlines of an emerging Trump Doctrine. Three key themes, in particular, will shape Trump’s decision-making on foreign policy.

When Opposites Attract

By Ryan Bourne

The contrast could not be starker. British Prime Minister Theresa May addressed the global elites of Davos last week promising to make Britain the standard bearer for a new era of free trade. She had her eyes set on ambitious new trade deals for Britain with old allies and new — with countries such as Australia, New Zealand, Brazil and China in her sights.
Just a day later, President Donald Trump’s inaugural address claimed that for the U.S., “protection will lead to great prosperity and strength.” One of his first acts in office was removal of the U.S. from negotiations surrounding the Trans-Pacific Partnership. His team has discussed renegotiating NAFTA and imposing punitive tariffs on China, whilst appointing a triumvirate of protectionists to key positions.

Thursday, January 26, 2017

Midnight in America

Peter Schiff
Stunned political analysts are missing the most plausible argument explaining Donald Trump's unexpected victory. The misreading of the American electorate stems from the political class’ acceptance of mistaken (and increasingly insane) economic dogma that has arisen over the past generation. Based on their flawed understanding of economics, the pundits could simply not understand why the electorate had become totally disillusioned.

Bush Trumps Reagan

Peter Schiff

The optimism that has followed the election of Donald Trump has pushed the Dow Jones Industrial Average to the threshold of 20,000, a level that will be both a nominal record and a symbolic milestone. Although this is not the way most observers had predicted that 2016 would play out, most on Wall Street have become extremely reluctant to look a gift horse in the mouth…or to even look at him at all. The impulse is to jump on and ride, and only ask questions if it pulls up lame. But if this year has proven one thing, it is that predictions made by the consensus should not be trusted.
Back in the earlier part of 2016 the mood was decidedly darker. At that point most people believed that the Federal Reserve would be raising rates throughout the course of the year. While such hikes had been anticipated (and delayed) for years, most took comfort in the belief that the economy would be expanding nicely by the time the Fed actually pulled the trigger. But in late 2015, the already tepid GDP growth seen in the prior two years seemed to be decelerating. Investors also concluded that Hilary Clinton was a lock to win the election, thereby assuring that the anti-growth policies of the Obama years would continue. Many looked at these developments and concluded that the sins of the past decade, in which the Government and the Federal Reserve had used unprecedented levels of fiscal and monetary stimulus to prop up the economy and the stock market, had finally caught up with us. As a result, the Dow Jones shed more than seven per cent in the first two weeks of the year, its worst start on record.

Trump Deficit Will Be Huge

Trump Deficit Will Be Huge

Our weekly commentaries provide Euro Pacific Capital's latest thinking on developments in the global marketplace. Opinions expressed are those of the writer, and may or may not reflect those held by Euro Pacific Capital.
Peter Schiff

There is much we don’t know about how the Trump presidency will play out. Will the Wall get built? Who will pay for it? Will it have at least some fencing? Will repeal and replace happen at exactly the same time? Will Trump throw a ceremonial switch? Will there be a Trump National Golf Course in Sochi? It’s anyone’s guess.  But of one thing we can be fairly certain. President Trump is very likely to preside over the largest expansion of Federal budget deficits in our history. Trump has built his companies with debt and I’m sure he thinks he can do the same with the country. His annual budget deficits are likely going to be huge. This development will make a greater impact on the investment landscape than most on Wall Street can imagine. 

Midnight in America. By Peter Schiff

Stunned political analysts are missing the most plausible argument explaining Donald Trump’s unexpected victory. The misreading of the American electorate stems from the political class’ acceptance of mistaken (and increasingly insane) economic dogma that has arisen over the past generation. Based on their flawed understanding of economics, the pundits could simply not understand why the electorate had become totally disillusioned.
According to the ideas favored by economists on Wall Street, in government, and in the Federal Reserve, Americans should be enjoying a marginally good economy. Unemployment is low, home values and the stock markets are high, credit is cheap and plentiful, prices are stable, auto sales are robust, healthcare is available to all, and GDP is growing, albeit at levels that are below optimal.

Central Banks Are Choking Productivity. By Peter Schiff

If the Economy were a car, productivity would be the engine. Heated seats, on-demand 4-wheel drive and light-sensitive tinted windshields, are all very nice. But they mean little if the engine doesn’t turn and the car just sits in the driveway. The latest productivity data from the Commerce Department confirms that our economic engine is sputtering.
If you strip away all the bells and whistles of economic analysis, the simple truth is that the increased living standards that have taken us from the stone age to the digital age happened because we increased our productivity. Better plows, windmills, bulldozers, factories and, more recently, better software, technology, and automation have allowed economies to produce more output with less human effort. This means there are more goods and services for more people to share and workers can work less to acquire those goodies. When productivity stops increasing, no amount of financial gimmickry can compensate.

Economic Conspiracies By Walter E. Williams

A general economic principle is that any law or regulation that restricts market entry tends to impose the greatest burden on those who can be described as poor, latecomers, discriminated against and politically weak.
The president of the NAACP’s St. Louis chapter, Adolphus Pruitt, has petitioned a circuit court judge to reject the St. Louis Metropolitan Taxicab Commission’s conspiratorial call to issue a temporary restraining order that would force Uber to shut down. He says the order would negatively impact nearly 2,000 African-Americans who work as Uber partners in black neighborhoods that have long been ignored by taxis and other transportation providers. In a statement, Pruitt said, “The immediate harm of a (temporary restraining order) would strand thousands of African American riders who depend on Uber to travel around a city that has measurable gaps in its transportation system and has failed to serve our neighborhoods for decades.” 

International Trade Thuggery By Walter E. Williams

President-elect Donald Trump’s threats against American companies looking to relocate in foreign countries have won favorable review from many quarters. Support comes from those alarmed about trade deficits, those who want a “level playing field” and those who call for “free trade but fair trade,” whatever that means.
Some American companies relocate in foreign lands because costs are lower and hence their profits are higher. Lower labor costs are not the only reason companies move to other countries.

Obama Suffocates Business Investment and Growth fullscreen

 When firms don’t invest in job-creation and higher wages, everyone suffers. GDP for the first quarter of 2016 came in at a paltry one-half of 1 percent. That sorry showing follows growth of 1.4 percent and 2 percent in the previous two quarters. If such a thing is possible, the already anemic economy is actually getting worse. But even worse than that, the latest GDP numbers reveal a collapse in business investment, the real driver of the economy. When businesses don’t spend and invest, they don’t hire and cannot offer better-paying jobs. Business investment and wages are two sides of the same mirror. If a company purchases five trucks rather than ten, there are five fewer trucking jobs. 
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