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www.freedomandprosperity.org |
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The views expressed by Andrew Quinlan and Dan Mitchell on this weblog are solely their own and are not necessarily those of their employers, The Center for Freedom and Prosperity Foundation and The Heritage Foundation, respectively. |
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The Market Center Blog |
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Observations and insights on the global fight |
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CF&P's Market Center Blog Archives |
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Wednesday, June 30, 2004 ~ 5:30 p.m., Dan Mitchell Wrote: As Americans celebrate their freedom on Sunday, it will be with a certain irony: Not all Americans have the freedom to celebrate the holiday with the traditional festive bang.
Though about 70 million of us live in states that allow all sorts of fireworks and firecracker use, 50 million other Americans who live in nine states, including New York and Arkansas, need a permit to even
light a sparkler. ...Safety is the major concern of those who ban our celebratory backyard light and noise shows, but their fears are overblown. ...It is hard to see much of a relationship over the years between
fireworks use and deaths. Though almost exactly the same number of people died in 1990 and 2002, fireworks use grew almost every year, soaring from 68 million pounds of explosives used to 221 million pounds.
States such as New Jersey that have adopted more stringent regulations or bans haven't seen significant drops in the number of fireworks-related deaths, in part because there were few such deaths to begin with.
During the last three years, states with bans actually had a higher fireworks-related death rate (.018 per million people) than the states without restrictions (.014 per million). ...Government can protect
people from only so much, and if we banned all the products that caused more deaths and injuries than fireworks, there would be virtually nothing left to use. After all, what is the Fourth of July celebrating if
we criminalize even the tiny risks associated with fireworks?
Wednesday, June 30, 2004 ~ 4:15 p.m., Dan Mitchell Wrote: What can the West do to help? The worst thing is more foreign aid. For the most part, foreign aid is government to government, and as such, it
provides the financial resources that allow Africa's corrupt regimes to buy military equipment, pay off cronies and continue to oppress their
people. It also provides resources for the leaders to set up "retirement" accounts in Swiss banks. Even so-called humanitarian aid in the form of
food is often diverted. Blundell reports that Mugabe's thugs rip labels off of wheat and corn shipments from the United States and Europe and re-label them as benevolence from the dictator. Most of what Africa
needs the West cannot give, and that's the rule of law, private property rights, an independent judiciary and limited government.
Wednesday, June 30, 2004 ~ 10:37 a.m., Dan Mitchell Wrote: ...the offer made me think about what a school of journalism ought to be teaching people whose jobs will be to inform the public. They first
and foremost ought to know what they are talking about, which requires a solid grounding in history, statistics, science -- and economics. Since journalists are reporting on so many things with
economic implications, they should have at least a year of introductory economics. People with a basic knowledge of economics would
understand that words like "surplus" and "shortage" imply another word that may not be mentioned explicitly: Price. And chronic surpluses or chronic shortages imply price controls.
Wednesday, June 30, 2004 ~ 9:57 a.m., Dan Mitchell Wrote: It is unfortunate that at the start of the 21st century, Europe and North America form two separate trading blocs. The Bush administration
could rectify that situation by declaring that, in principle, the North American Free Trade Agreement could expand to include interested Europeans, thus transforming NAFTA into a North Atlantic Free Trade
Agreement. The new bloc could offer many benefits, including improved market access for exports from Europe and North America, increased economic efficiency and greater global economic stability. It could
thwart the plans of those in Europe who want to pursue a policy of economic centralization and unify the Continent around anti-Americanism. In short, for the U.S. and much of Europe, it could be
a winning strategy.
Wednesday, June 30, 2004 ~ 8:46 a.m., Dan Mitchell Wrote: ...neither actual nor projected budget deficits raise real or nominal interest rates, steepen the yield curve, reduce national savings, cause
trade deficits, or make the dollar go down or up. The logic behind such speculations is flawed and the evidence is missing. These issues are important because numerous pundits and policymakers are arguing that
taxes should be raised to reduce deficits. Indeed, a theme of Rubin, Orszag, and Sinai is that higher tax rates can improve economic growth, but that runs directly counter to serious research on the causes
of economic growth. Research on economic growth assigns importance to the tax structure, marginal tax rates, and the level and composition of government spending, but not to whether spending is financed by
taxes or deficits. Deficits are a sign that federal spending is too high, but deficits do not cause many of the economic harms that some analysts are claiming.
Wednesday, June 30, 2004 ~ 7:19 a.m., Dan Mitchell Wrote: Headlining an appearance with other Democratic women senators on behalf of Sen. Barbara Boxer, who is up for re-election this year, Hillary
Clinton told several hundred supporters -- some of whom had ponied up as much as $10,000 to attend -- to expect to lose some of the tax cuts passed by President Bush if Democrats win the White House and control
of Congress. "Many of you are well enough off that ... the tax cuts may have helped you," Sen. Clinton said. "We're saying that for America to
get back on track, we're probably going to cut that short and not give it to you. We're going to take things away from you on behalf of the common good."
Tuesday, June 29, 2004 ~ 10:49 p.m, Dan Mitchell Wrote: The Liberals, who have gone from a 168-seat majority in the 308-seat House of Commons to a plurality of about 135 seats, will almost
certainly form a coalition with the socialist New Democratic Party (NDP) to rule Canada. The NDP peddles a watered-down form of socialism that's heavy on interest-group politics but moderate overall:
The party has few major spending plans, and even proposes some tax cuts. But the NDP is dead set on taking away Canadians' guns and even reducing gun freedoms in the U.S. "We're proposing going across the
border to the U.S. and actively engaging in lobbying to have gun-control laws in the U.S. strengthened," NDP leader Jack Layton explained at a May campaign rally in Winnipeg. And, given that the
Liberals will almost certainly have to deal with him to join a government, more gun control - which imposes reasonably few monetary burdens - may well become reality. ...In addition to being
awfully arrogant, this plan is ironic, since more crime probably flows from Canada to the U.S. than vice versa: The nation has an overall crime rate half again higher than the United States'. Toronto, once the
safest large city in North America, now has more muggings, car thefts, and violent assaults per capita than New York City. All of Canada's major provinces would rank among the 20 most dangerous American
states. Since American crime rates peaked in the early 1990s, crime has fallen in 48 American states and over 80 percent of America's major
cities. Meanwhile, it has risen in six of Canada's ten major providences and seven of its ten largest cities. The reasons for this divide are
complex, but it's notable that the United States imprisons wrongdoers at about five times Canada's rate and has about a quarter more police on a per-capita basis. Canada, meanwhile, can boast only of a national
gun-registration database that cost 1,000 times more than originally projected.
Tuesday, June 29, 2004 ~ 3:51 p.m., Dan Mitchell Wrote: The outgoing head of the socialist group in the European Parliament, Enrique Baron Crespo, has launched a scathing attack on Portuguese
prime minister José Manuel Durão Barroso, who is expected today to be confirmed as the next President of the European Commission. In an interview with French daily Le Monde, Mr Crespo derides Mr Durão
Barroso as "neither sufficiently European, nor sufficiently social". ..."In terms of economics, [he] has proved his conservatism in his country
and is very right-wing, concerning himself only with competitiveness. ...For me, as a Spanish socialist, this is something I cannot accept".
Tuesday, June 29, 2004 ~ 2:29 p.m., Andrew Quinlan Wrote: The minimum wage is like a tax on small businesses that reduces their ability to hire and raise wages. According to the [Small Business
Administration], there was slower wage growth among low-wage workers in small firms during times when the minimum wage was rising. Even among large firms, the probability of a low-wage worker being
unemployed doubled after the minimum wage was increased. ...minimum wage jobs are not unimportant jobs. They are the first rung on the employment ladder for most workers. The experience they gain in
such simple areas as showing up for work on time, and learning to follow instructions and how to interact appropriately with customers, clients and patients are critical to success in life. That is why wage
growth among those hired in a minimum wage job is very high for those who stick with it. ...90 percent of workers hired at the minimum wage are earning more than the minimum after one year.
Tuesday, June 29, 2004 ~ 1:42 p.m., Dan Mitchell Wrote: Minister for Finance Charlie McCreevy last week declared that Irelands recent economic prosperity was due to a policy of low taxation. ..."Our
low-tax strategy has paid huge dividends and is, I am certain, strongly supported by the Irish people, as evidenced by the results of the last general election when the economy and its management were central
campaign issues," noted McCreevy. ...low tax policies have the overwhelming support of the populace, citing an opinion poll taken last autumn in which only 9% of respondents favoured raising taxes to
tackle the budget deficit.
Tuesday, June 29, 2004 ~ 10:23 a.m., Dan Mitchell Wrote: Last week a San Francisco federal judge ruled that a lawsuit by a handful of Wal-Mart female employees should be transformed into a
massive class-action case on behalf of 1.6 million women who worked at Wal-Mart over the last eight years. In rendering his decision, Judge
Martin Jenkins called the case "historic." But critics of our civil justice system wouldn't call the case "historic" so much as sadly typical of the
current state of U.S. employment law. The suit is based on individual cases that reveal little more than the frustrated ambitions of underperforming or unpopular workers, backed up by dubious
statistical analysis and tortured logic that binds together contradictory arguments by the thinnest of threads. ...Incredibly, the plaintiffs' lawyers
even quote disapprovingly a Wal-Mart store manager who says he relies on "teamwork, ethics, integrity, and the ability to get along with others"
in making promotions. "Such unwritten, subjective criteria," the lawsuit states, "are particularly vulnerable to the influence of stereotypes." Of
course, only in the moral netherworld that many plaintiffs' attorneys inhabit these days would "ethics" and "integrity" be considered
"subjective" criteria to be avoided in making hiring or promotions. ...That the case against Wal-Mart is so flimsy isn't surprising. Since it
became the largest company in America, Wal-Mart has also emerged as the most-sued company. Trial lawyers have set their sights on Wal-Mart's deep pockets and are aided by the numerous unions and
left-wing advocacy groups, whose barrage of negative publicity about the company aims to force it to unionize and to soften up public opinion for a big payoff in court in cases like this.
Tuesday, June 29, 2004 ~ 9:49 a.m., Dan Mitchell Wrote: If students receive grants or subsidized loans covering much of the cost of attending school, they become far less sensitive to tuition increases.
The discipline of the market is not strong. In a free, unsubsidized market, consumers are sensitive to rising costs, and entrepreneurs seek to cut costs and lower prices to lure new customers away from others.
But higher education does not work that way in America today. ...In many ways, higher education resembles health care: third parties (e.g., governments, insurance companies, foundations) pay most of the bills,
making consumers relatively indifferent to the price of services. ...The evidence shows that very little increased government support given state universities over the past generation has actually gone toward
instruction. Moreover, the evidence shows that lavishing more state funds for higher education does not have much effect on the number of kids going on for college degrees. ...state university presidents claim
that supporting higher education is investing in human capital and that human capital is vital for economic growth. Yet the empirical evidence suggests that, other factors held equal, the more state governments
support higher education, the lower the rate of economic growth. Why? When government support for colleges grows, it forces higher taxation
on private sector activity that, on average, is produced more efficiently than university activity. Money is shifted from highly productive to less
productive uses. Also, much increased public support for universities does not go to expand learning or student access, but to provide higher
incomes and lighter work loads for university staff. ...A good case can be made that governments should largely get out of the higher education business, ending state subsidies and tax advantages for
private donations. Moreover, the evidence is strong that massive governmental infusions of funds, along with tax-sheltered private contributions, have contributed to the cost explosion in higher education.
Monday, June 28, 2004 ~ 5:17 p.m., Dan Mitchell Wrote: Unemployment is the biggest source of worry for Europeans, according to a new survey published today (22 June) by the GfK market research
group. People in eight countries (the UK, Germany, France, Spain, Poland, Italy, the Netherlands, Austria) were asked what was their biggest source of concern. Just under half of all those surveyed
responded that unemployment worried them the most. And the fear of losing jobs was the top concern in all but two countries (the UK and the Netherlands). ...In Germany - where unemployment is over four million -
77 percent of people asked said this was their main worry in life.
Monday, June 28, 2004 ~ 3:59 p.m., Dan Mitchell Wrote: There were 12,274,368 in the Voting Age Population of 205,815,000 missing from the 2000 presidential election, because of abortions from
1973-82. ...Look inside these numbers at where the political impact is felt most. Do Democrats realize that millions of Missing Voters--due to
the abortion policies they advocate--gave George W. Bush the margin of victory in 2000? ...There are 19,748,000 Democrats who are not with us today. (49.37 percent of 40 million). There are 13,900,000 Republican
who are not with us today. (34.75 percent of 40 million). By comparison, then, the Democrats have lost 5,848,000 more voters than the Republicans have. ...Missing Voters--through decisions made in the
1970s and early 1980s, encouraged and emboldened by the feminist movement at the height of its power--altered the outcome of the U.S. presidency a generation later, in a way proponents of legal abortion
could not have imagined.
Monday, June 28, 2004 ~ 10:45 a.m., Dan Mitchell Wrote: ...higher tax rates reduce work time in the market sector, increase the size of the shadow economy, alter the industry mix of market activity,
and twist labor demand in a way that amplifies negative effects on market work and concentrates effects on the less skilled. ...Regressions on rich-country samples in the mid 1990s indicate that a unit standard
deviation tax rate difference of 12.8 percentage points leads to 122 fewer market work hours per adult per year, a drop of 4.9 percentage points in the employment-population ratio, and a rise in the shadow
economy equal to 3.8 percent of GDP.
Monday, June 28, 2004 ~ 10:19 a.m., Dan Mitchell Wrote: As for an overall cost estimate, W. Mark Crain of George Mason University and Thomas D. Hopkins of the Rochester Institute of
Technology prepared an estimate of regulatory costs for 2000 for the Small Business Administration. Their report assessed social and environmental costs as well as costs of economic regulations (such as
price and entry restrictions), "transfer" costs (such as farm price supports, which shift money from one pocket to another), and paperwork costs (such as tax compliance). It found 2000 regulatory
costs of $843 billion. (That estimate is largely in line with the inflation-adjusted $815 billion predicted for 2000 by Hopkins in a 1995 report for the Small Business Administration). Updating the Crain and
Hopkins 2000 regulatory costs for 2003 by extrapolating the growth in regulatory costs that had occurred between 1995 and 2000 yields an estimate of $869 billion.
Sunday, June 27, 2004 ~ 3:22 p.m., Dan Mitchell Wrote: The individual income tax burden on dividends was lowered sharply in 2003 from a maximum rate of 35% to 15%, creating a unique
opportunity to analyze the effects of dividend taxes on dividend payments by U.S. corporations. ...We find a sharp and widespread surge in dividend distributions following the tax cut, along several dimensions.
First, the fraction of publicly traded firms paying dividends began to increase precisely in 2003 after having declined continuously for more than two decades. Nearly 150 firms have initiated dividend payments
after the tax cut, adding more than $1.5 billion to aggregate quarterly dividends. Most of these firms initiated regular, recurrent payments rather than one-time special' distributions. Second, many firms that
were already paying dividends prior to the reform raised regular dividend payments significantly after the tax cut. ...All three of these effects are significant among all company sizes, and are robust to
controls for profits and other firm characteristics.
Sunday, June 27, 2004 ~ 1:00 p.m., Dan Mitchell Wrote: One idea suggested is to ban television commercials for "junk food" directed at kids. This chestnut first surfaced at the Federal Trade
Commission in the late 1970s. It didn't go anywhere then -- and it shouldn't go anywhere now. ...A ban would be ineffective because there is no reason to think that the ads kids see make them obese. Although
American children see thousands of food ads each year, they have done so for decades -- since long before the dramatic upswing in obesity. Today's kids actually watch less television than previous generations
and have many more commercial-free choices. Even our dogs and cats are fat, and it is not because they are watching too much advertising. ...Our First Amendment requires government to demonstrate that
restrictions on truthful, non-misleading commercial speech for legal products meaningfully advance a compelling interest. Because a children's advertising ban would be ineffective, it would fall far short of
that test.
Saturday, June 26, 2004 ~ 12:11 p.m., Dan Mitchell Wrote: Farmers in rich countries received $257.3bn (140.2bn) in financial support from taxpayers and consumers last year, amounting to 32 per
cent of their gross receipts... farmers in the US are still substantially less reliant on subsidies than their European counterparts; subsidies and
other transfers account for only 18 per cent of their gross receipts. ...
Friday, June 25, 2004 ~ 11:10 a.m., Dan Mitchell Wrote: As the offshore outsourcing debate continues to rage on, another group of companies has come in for severe criticism in the US: "expatriate"
services firms. Companies including Seagate Technology and Tyco have moved their headquarters from the US to offshore tax havens, and are
now being branded as "unpatriotic" by critics who say they are taking money from the hard-working US tax payer and possibly doing US IT
contractors out of a job. The anger being expressed by both state and government representatives is getting more and more fierce, as they attempt to expose the next case of unpatriotic villainy. ...In fact when
the argument focuses on "unpatriotic" acts and the lack of favoritism for local companies and workers, it really boils down to this - the US is
putting up barriers to stifle competition from overseas, and maintain the incumbent status quo.
Friday, June 25, 2004 ~ 10:54 a.m., Dan Mitchell Wrote: In an interview with the New Statesman, quoted by the Independent, Trade and Industry Secretary Patricia Hewitt said that a no vote could
put Britain on the road to withdrawal from the EU. "We will be in uncharted territory. It would have the effect, and would be intended to
have the effect, of putting Britain on the margins, and probably on the road to withdrawal". ...Ms Hewitt's remarks, however, have led to
criticism. She has been accused of scare tactics by the shadow Foreign Secretary Michael Ancram, the Independent reported.
Friday, June 25, 2004 ~ 10:16 a.m., Dan Mitchell Wrote: ...voters would do themselves, and the European Union, a great service if they were to reject this treaty and jolt governments into coming up
with a better version. Some European politicians and EU devotees have argued that the consequences of a rejection would be catastrophic. That is hyperbole. ...the treaty does bring some real improvements to the
EU-for governments. For the people they serve, however, it does not. ...the point of a constitution, or even of a constitutional treaty, as many
European leaders now prefer to call it, is not simply to make the process of government easier. In some ways, just the reverse: it is to make sure
that government happens under clear rules and constraints, so that it is hard for it to act and evolve in ways that citizens find unacceptable. Otherwise, effectiveness may be achieved at the expense of popular
legitimacy and, ultimately, provoke a backlash. That is where Europe's new constitution fails. ...But if voters are to feel comfortable both with
that efficiency and that enlargement, they need a constitution that stabilises and controls the process properly. Such a constitution plainly
cannot be achieved just by inter-governmental negotiations. It needs to be demanded by voters. That is why the best result in all the ten referendums would be a resounding no vote.
Friday, June 25, 2004 ~ 8:27 a.m., Dan Mitchell Wrote: The last remaining right - the attorney-client privilege - is under full-scale assault by DOJ prosecutors in the tax shelter case involving
the accounting firm KPMG. ...In recent years, the DOJ has taken the position that winning its cases is more important than historic rights centuries in the making. ...Americans need to think seriously about the
quality of "justice" that is coming from the Justice Department. Prosecutors have defined "cooperation" as aid in convicting oneself or
a fellow employee, as waiving all constitutional rights and privileges, as betrayal of fellow employees and as helping prosecutors create the appearance of guilt even when no crime has been committed. ...What we
are witnessing is the emergence of a fascist legal order in which law and legal procedure are whatever unelected officials decide serves the interest of government. How else can we explain how the four
foundations of our legal system - no retroactive law, no crime without intent, no self-incrimination and the attorney-client privilege - have been swept aside in the federal case against KPMG?
Thursday, June 24, 2004 ~ 3:35 p.m., Dan Mitchell Wrote: It's been called the Detroit of Europe, even though the Hong Kong of Europe might be more appropriate. Recently Deutsche Welle labeled
Slovakia "A Monaco on the Danube". Even more importantly, it's not out of the question that soon we will hear about the Slovakias of Africa
or South America. ...With a flat rate of 19 percent, Slovakia leads the European low tax competition, something that naturally infuriates
socialists in the rest of the union, but makes foreign investors laugh all the way to the bank. Recently, south Korean car and appliance maker Hyundai chose Slovakia for a giant car manufacturing plant, joining
earlier carmakers such as Volkswagen and Porsche and instantly giving the country the nickname the Detroit of Europe. ...Evans, today president of the Center for the New Europe in Brussels, recently
revisited Slovakia and came back most enthusiastic. Says Evans: "The Slovak economy is doing well. Growth is well over 4 percent and unemployment is coming down steadily. Whilst the traditional liberal
centers such as Bratislava are doing very well, wealth creation is also clearly permeating the villages and rural areas. With its low flat tax and
booming manufacturing and service sectors, Slovakia is justified in its reputation of being the new Hong Kong of Europe."
Thursday, June 24, 2004 ~ 2:27 p.m., Andrew Quinlan Wrote: John Kerry says he wants to raise the minimum wage to $7 an hour from $5.15, and his proposal has us thinking: Why stop there? Why not
$10 an hour, or $20, or for that matter whatever a U.S. Senator makes? ...wage floors aren't manna from heaven. Here on Earth, they tend to price certain kinds of labor out of the job market. Businesses hire and
pay workers what they think their skills are worth relative to other ways they can spend their capital. Force the price of labor too high, and
suddenly businesses hire fewer workers, especially those at the lower rungs of the skill ladder. ...Bill Clinton's Small Business Administration followed a group of workers after the last increase in the minimum
wage, in 1997, and found it slowed wage growth at small businesses and more than doubled the likelihood that low-wage workers at large firms would be unemployed.
Thursday, June 24, 2004 ~ 11:06 a.m., Dan Mitchell Wrote: [T]he "CHOICE" Act [will] allow individuals to avoid unnecessary regulatory costs by purchasing health insurance from whatever state
they wish. The result would be more affordable health insurance for everyone and fewer uninsured. ...Five different states require consumers to buy coverage for wigs. Yes, wigs. Other types of required coverage
include alcoholism (45 states) and infertility treatment (14 states), contraceptives (25 states), acupuncturists (10 states), marriage therapists (14 states), massage therapists (2 states), and osteopaths (21
states). States have passed over 1,500 laws mandating that health-insurance purchasers (individuals and employers) buy particular types of coverage they may or may not want, usually at the behest of
those who provide the covered service. Studies have found these mandates increase the cost of coverage by 15-30 percent, and prevent up to 25 percent of the uninsured from purchasing insurance. The
situation is so bad that a few years ago Vermont Gov. Howard Dean (D) — who never met a big-government idea he didn't like — begged Vermont's legislature to stop enacting mandates because they were
making coverage too expensive. Currently, only very large employers can avoid these regulatory costs. Everyone else must pay up, go without health insurance, or move to another state. The CHOICE Act would
change all that by allowing any willing consumer to buy coverage from any willing insurer, nationwide.
Thursday, June 24, 2004 ~ 10:47 a.m., Dan Mitchell Wrote: Research conducted by accounting firm KPMG has found that one third of private banking institutions are planning acquisitions in the next
three years, with the Asia Pacific region identified as a particular hot spot. According to KPMG, the Asia-Pacific region accounted for 41% of all private banking acquisitions in 2003 (by volume). This compares
with a figure of 23% in 2000 and is a trend the firm forecasts is set to continue, with the research suggesting that private banks around the
world see Asia-Pacific as being the most noteworthy market in terms of growth potential. ...Commenting on the findings, Rupert Chamberlain,
Director, KPMG Transaction Services, noted: "When asked to identify the most noteworthy markets in terms of growth potential, private bankers pointed clearly towards Asia-Pacific, citing a combination of
regulatory requirements in Europe and North America, the changing European tax and legal environment...
Thursday, June 24, 2004 ~ 9:09 a.m., Dan Mitchell Wrote: Mr. Chirac told other world leaders they should consider "a kind of international tax" to raise $50 billion dollars, the sum the United
Nations claims is needed to cut the world poverty rate in half by 2015. Mr. Chirac should be commended for trying to focus the attention on
world poverty, but if he really wants to raise $50 billion for that purpose we know just where he can find the money. Indeed, if he follows our recommendation -- to scrap the European Union's Common
Agricultural Policy (CAP) -- he will save that much and not even have to spend it on dubious U.N. foreign aid programs. ...CAP's combination of tariffs, price supports and export subsidies manages to
simultaneously raise food prices in the EU while driving down agricultural prices in the rest of the world. Those artificially lowered prices prevent non-EU farmers from competing with EU farmers on the
world market even as tariffs and quotas keep many countries locked out of the EU market. The result is that Third World farmers and the rural economies they support remain mired in permanent poverty. ...The last
in-depth examination of the global economic consequences of the CAP -- published in June 2000 by the London-based Institute for Economic Affairs -- found that the overall cost of CAP to the world is $75bn a
year, $49 billion of which is borne by the EU directly. ...The Chirac global tax idea is absurd, of course; income transfers usually don't even
give lasting relief to the people they are supposed to help. The taxation that finances them acts as a drag on the economy, essentially leveling
everyone downward. Instead of attempting to tax others to repair the damage the CAP is doing, a French-led "multilateral" campaign to cut tariffs and subsidies would be far more appropriate.
Thursday, June 24, 2004 ~ 8:29 a.m., Dan Mitchell Wrote: After four years of steady economic decline and stubbornly high unemployment, the so-called Lisbon Agenda has been sent to a
High-Level Working Group for review. ...Made up entirely of "representatives" from the groups that gave us the economic stagnation
and gridlock we see around everyday -- the trade unionists, anti-market NGOs and big business ...When our politicians talk about competitiveness, what they usually mean is more protectionist industrial
policy. How else can the newly appointed French Finance and Economics Minister Nicholas Sarkozy claim with a straight face, as he
did recently, that "it is not a right of the state to help its industry. It is a duty." No, Mr. Sarkozy, competitiveness means that you provide the
political framework in which entrepreneurship and risk-taking can flourish, not through state interventions but through the lack thereof. Competitiveness means moving away from national tribalism and
creating deserving champions based on merit, productivity and competitive prices. ...it would help Europe tremendously if we stopped dressing up our underperforming institutions with fancy names. Just
because a government body prides itself on defending the interests of competitiveness, innovation or enterprise doesn't mean that it is committed to making progress in any of these vital areas.
Thursday, June 24, 2004 ~ 7:56 a.m., Dan Mitchell Wrote: Commission Spokesman Jonathan Todd admitted June 23 that, if the Swiss hold a referendum and the agreement with the EU is rejected, the
EU cross-borders saving tax law will likely collapse. "I presume that the directive will not actually come into force if something happened between July 2004 and July 2005 which resulted in the savings tax
agreement not actually being applied in Switzerland," Todd said. "For example, if the Swiss parliament agreed to the accord but a referendum
was then forced and the Swiss public rejected the deal, then in that hypothetical situation the directive would not be able to come into force."
Wednesday, June 23, 2004 ~ 10:11 p.m., Dan Mitchell Wrote: Tax Freedom Day will finally arrive in Canada on June 28 this year, according to the calculations of the economic and social think-tank The
Fraser Institute. Tax Freedom Day is now calculated in most industrialised nations, and provides a simple reference point as to the true tax burden placed on citizens by their governments. In this case, it
effectively means that all income earned by Canadian taxpayers prior to June 28 was used to pay the government's tax demands at all levels: federal, provincial and local. For the average Canadian, Tax Freedom
Day has been steadily slipping over the last four years. According to revised figures from Statistics Canada and government financial information, Tax Freedom Day fell on June 25 in 2001, June 26 in 2002,
and June 27 in 2003. ...The figures contrast sharply with those of the United States, where taxes have been generally falling, and Tax Freedom Day fell well over two months earlier than in Canada this
year, on April 11.
Wednesday, June 23, 2004 ~ 5:42 p.m., Dan Mitchell Wrote: New Jersey is … falling into the same "progressive" tax trap that has done so much damage to California and New York. On Monday the
Legislature passed Governor Jim McGreevey's "millionaire's tax" (which actually kicks in at $500,000 of household income, but never
mind). The state's top marginal tax rate is set to rise by 41%--to 8.97% from 6.37%--and make New Jersey's top income bracket the fifth-highest in the country. Mr. McGreevey was elected pledging not to
raise taxes, by the way. …The Governor has proposed a $27 billion budget that's expected to pass and includes a 13% spending hike, the largest in state history. Mr. McGreevey is spending so much so fast that
he also plans to borrow at least $1.5 billion in addition to the tax increases. …Heavy reliance on income taxes from the wealthy is a notoriously unreliable way to fund government, and leads to revenue
booms and busts. Tempted by windfalls from high-income earners during the boom years of the late 1990s, politicians in California and New York spent without regard for the next economic downturn and
suffered for it later. The legitimate fear is that Mr. McGreevey is setting up New Jersey to repeat those mistakes. A recent New Jersey Chamber
of Commerce study said that, in 2001 and 2002, taxable income in the state fell by $9.62 billion, and "$9.5 billion of the fall came from taxpayers who had taxable income of $500,000"--Mr. McGreevey's
"millionaires." When the state's next budget crisis comes, we predict it won't be only "the rich" who pay.
Wednesday, June 23, 2004 ~ 11:40 a.m., Dan Mitchell Wrote: Whatever the media think about themselves, there is simply no denying that a high percentage of Americans perceive a liberal bias. ...This has
affected viewing habits. Conservatives have drifted away from those outlets they perceive as most biased, which has contributed heavily to an overall decline in viewership. Among all Americans, those who watch
the evening network news regularly have fallen from 60 percent in 1993 to just 34 percent today. Among Republicans, 15 percent or less report watching the evening news on ABC, CBS, or NBC. ...The conclusion of
the Groseclose-Milyo study is unambiguous. "Our results show a very significant liberal bias," they report. Interestingly, they found that the Internet's Drudge Report and "Special Report" on Fox News were the
two outlets closest to the true center of the political spectrum, despite being widely viewed as conservative. Groseclose and Milyo also look at
the political orientation of journalists relative to the population. They note that just 7 percent of journalists voted for George H.W. Bush in
1992 versus 37 of the voting public. This means that journalists are more liberal than voters in the most liberal congressional district in the
U.S., the 9th district in California, which contains the city of Berkeley. Even there, Bush got 12 percent of the vote, almost twice his support
among journalists. ...a key reason for the popularity of people like Rush Limbaugh is that they provide news and information not available elsewhere, not just conservative opinion. This helps explain why liberal
talk radio has been such a dismal failure. Listeners are not getting much they can't already get in the dominant media. In Prof. Mayer's words, "Liberals, in short, do not need talk radio. They already have Dan
Rather, Peter Jennings, and Tom Brokaw — not to mention NPR."
Wednesday, June 23, 2004 ~ 10:59 a.m., Dan Mitchell Wrote: …a General Accounting Office (GAO) report released this month reveals that bureaucrats in the Veterans Health Administration have
been using cards issued by Citibank to charge movie and baseball tickets, children's clothing, country club outings, expensive meals and even cases of beer to the taxpayers. …In 1994, says GAO, federal
charge-card expenditures were $1 billion. By 2000, 500,000 federal workers carried the card, using it to spend $12 billion. By 2003, card carriers dropped to 325,000, but spending jumped to $16.4 billion. That
is almost twice as much as government spent that year on the Legislative Branch ($3.4 billion) and Judiciary Branch ($5.1 billion) combined. When Clinton signed the charge-card law, he said it would let
federal workers "shop for the best deal without being bogged down in any bureaucracy." But GAO discovered the opposite is often true. "Dun
and Bradstreet's analysis of fiscal year 2002 Interior transactions, conducted on our behalf," said GAO, "illustrates that cardholders
frequently paid more than necessary." …But Clinton has been gone from office four years now. Isn't it time Republicans closed the charge accounts he opened in the taxpayer's name?
Wednesday, June 23, 2004 ~ 10:03 a.m., Dan Mitchell Wrote: European Union member states face the prospect of having to delay implementation of long-sought but controversial cross-border savings
tax legislation as Switzerland made it clear June 22 that it would be impossible to implement by Jan. 1, 2005, a parallel accord on which the
EU law hinges. As a result of the Swiss delays, Luxembourg--which, like Switzerland has a trillion-dollar banking industry built on secrecy laws--is threatening to further delay and possibly derail the EU
legislation if it does not receive assurances that it will not have to implement the law as long as the Swiss do not implement the parallel
accord. …"The longer we have to delay the greater the chances that the whole agreement could fall apart," the EU official added. Based on an
agreement reached two years ago, EU member states are due to decide by the end of June whether the EU cross-border savings tax law will take effect as of Jan. 1, 2005. That decision hinges on whether or not
third countries such as Switzerland and other independent territories, such as Liechtenstein, have agreed to adopt "equivalent measures."
…During the more than seven years that the current EU cross-border savings tax has been under negotiation in the Council of Ministers, Luxembourg, where many EU citizens hide their savings from high
taxes in neighboring countries such as Germany, France, and Belgium, has been determined not to give up bank secrecy if Switzerland does not. It was Luxembourg--along with Austria, which also has a form of
bank secrecy but nowhere near the banking industry of Luxembourg--that demanded the Swiss and the independent territories commit to equivalent measures.
Wednesday, June 23, 2004 ~ 9:28 a.m., Dan Mitchell Wrote: Turnout was down from its previous historic low, euro-skepticism was up, with skeptical parties across Europe winning around 10 percent of
the vote. ...Any normal organization would use these warning signals to reassess its priorities. If the public's response to ever closer union is ever
greater skepticism, maybe the next step should not be one in the direction of increased federalization. But the European Union is a bit like the alien behind the wheel in the film Starman: "Red light stop,
green light go, yellow light go very fast." And so, just a week after the Euroskeptic revolt, federal enthusiasts succeeded in driving the
European project closer to their end-goal of a United States of Europe by producing a written constitution for the EU. ...this treaty represents
a big missed opportunity. The historic chance, for instance, to cut the European bureaucracies down to size. Behind the scenes, most European negotiators agree that there is plenty of scope for reducing
the size of the EU's bloated civil service. The Dutch Foreign Minister Ben Bot admitted as much publicly in a recent speech at the Von Humboldt University in Berlin, when he called for the transfer back to
the member states of EU powers in the field of cultural policy, parts of the Common Agriculture Policy and the structural funds, health policy
and social affairs. Unfortunately, this treaty does nothing of the sort. It also misses the opportunity to block the creation of a number of new powers for the European institutions. The European Charter of
Fundamental Rights is a case in point. Its inclusion in the treaty could lead to the chaotic situation in which two rival courts (the European Court of Justice in Luxembourg and the European Court of Human
Rights in Strasbourg) issue competing judgments on similar legal questions. Its inclusion also gives the judges in Luxembourg further scope to interfere in matters that should really be decided in the political
arena.
Wednesday, June 23, 2004 ~ 8:31 a.m., Dan Mitchell Wrote: Three-term Rep. Jim DeMint trounced ex-Gov. David Beasley on Tuesday to win a Republican runoff in South Carolina and earn a spot
on the November ballot for a Senate seat that has been occupied by the same Democrat for almost 40 years. …With all precincts reporting in South Carolina, DeMint had 59 percent, or 153,947 votes, while Beasley
had 41 percent, or 106,113 votes. …The two generally sparred over trade issues and how best to revive South Carolina's manufacturing-heavy economy. DeMint supports free trade, while
Beasley is more of a protectionist.
Wednesday, June 23, 2004 ~ 7:12 a.m., Dan Mitchell Wrote: The removal of the taxation article in the constitution gained tentative approval when EU foreign ministers met June 15 in Luxembourg.
However, the issue was reopened at the summit of EU leaders at the insistence of French President Jacques Chirac, German Chancellor Gerhard Schroeder, and Belgian Prime Minister Guy Verhofstadt.
Chirac insisted June 18 that, without the articles on taxation in the constitution, the treaty "was watered down" and would not "serve the
purpose of establishing the proper framework for an enlarged" EU of 25 member states. The French president also accused British Prime Minister Tony Blair of being responsible for having the taxation article
removed. ...However, according to Ireland, there were a number of other countries, especially new member states from Eastern and Central Europe, that joined the United Kingdom in opposing the taxation
articles. "Even though the articles only deal with tax fraud, there were a number of countries concerned that believed this article was just a
way to open the door to QMV for other tax legislation," said Irish spokesman James McIntyre. Irish officials said the new member states hardened their position on the tax issue in the past month after
Schroeder accused them of using low tax rates to lure companies from Western Europe. "The consistent criticism from Schroeder seemed to bring a number of countries to the side of the United Kingdom on the
taxation issue," McIntyre said. ...The European Commission June 21 expressed disappointment at the failure of the taxation article in the
constitution. "It was simply a matter of dealing with tax fraud," said commission spokesman Jonathan Todd. "We feel that the position of some member states was exaggerated."
Tuesday, June 22, 2004 ~ 6:26 p.m., Dan Mitchell Wrote: Talks over financing the EU's budget from 2007 to 2013 are set to be "more difficult" than agreeing the Constitution, senior diplomatic
sources revealed today. ...And the seeds of a serious row over the EU's budget have already been sown. The European Commission has proposed large increases in the amount Member States must make
available to Brussels over the seven year period. But six Member States (the UK, France, Germany, Sweden, the Netherlands and Austria) launched a pre-emptive attack before the Commission proposals were
tabled, saying that the limit for payments should be capped at a lower rate than current levels. ...Mr Schönfelder [the German Ambassador to the EU] explained that Germany would have grave difficulties
explaining to their voters why the EU budget is increasing so much at a time when their own national budget had to be trimmed.
Tuesday, June 22, 2004 ~ 11:24 a.m., Dan Mitchell Wrote: ...a hedge-fund manager, personally knows all of his investors but he requires them to send him printed copies of their driver's licenses. His
last prospectus had 22 extra pages. He questions the destination of every wire transfer his fund sends. ...he wants to be careful he doesn't
run afoul of new regulations mandated by the Patriot Act. ..."It's ludicrous to do all this paperwork," said Harvey, who runs Hot Creek
Capital, a Reno, Nev.-based hedge fund... So far, the law's biggest impact has been on private-equity firms, mutual funds, brokerages and investment banks. ...they have not only been thrust into a new
regulatory cauldron. They have been plunged into an area full of confusion. "It was a political response to 9/11," Newcomb said, "with
little thought to the difficulties it posed and without a great deal of meaningful discussion." ...regulators, observers point out, have been
struggling with the law itself, and, as a result, have not brought any high-profile cases against industries new to money-laundering laws. ...some financial companies wonder if their new controls are bearing
fruit. It is common for financial companies never to hear back from the government on a suspicious transaction they report. Added Djinis, the
former Treasury lawyer: "There's been a great deal of frustration."
Tuesday, June 22, 2004 ~ 5:15 a.m., Dan Mitchell Wrote: Mr. Bush... [has] adopted a lot of the soft fatuities of the left - "Leave no child behind" - and he doesn't care how expensive they are to
implement. On Labor Day last year, Mr. Bush said: "We have a responsibility that when somebody hurts, government has got to move." With conservatives like that, who needs Sweden? It may be that there
are good sound arguments for federalizing education spending or creating a huge new prescription-drug entitlement, but, if so, Mr. Bush never makes them - or, to be more precise, he never bothers to place
these programs within any kind of coherent political philosophy.
Monday, June 21, 2004 ~ 5:10 p.m., Dan Mitchell Wrote: Prices have hovered around $2.00 per gallon for a month now, and next to the high price of oil, these regulations are the biggest contributor.
Federal rules have contributed to the nation's inadequate refining capacity by discouraging expansions at existing facilities and preventing construction of new ones. The last refinery was built in 1976. Other
measures have led to a hodgepodge of fuel specifications requiring more than a dozen different blends throughout the country. Overall, the federal regulatory costs may well exceed the federal gas tax of 18.4
cents per gallon. New rules, phased in this year, have brought this burden to an all-time high. ...Sens. Joe Lieberman, Connecticut Democrat, and John McCain, Arizona Republican, have co-sponsored
the Climate Stewardship Act ...the bill is still very costly. This includes an additional 13 cents per gallon of gas by 2010, and 29 cents by 2025.
And that's on top of the price impact from all the other regulations.
Monday, June 21, 2004 ~ 4:44 p.m., Andrew Quinlan Wrote: One of the most basic principles of international law is that a state cannot be bound by a treaty to which it is not a party. Further,
long-standing international legal norms hold that a state cannot be bound to legal assertions that it has specifically rejected. The ICC, however, directly contravening the norms and precedents of
international law, claims jurisdiction to prosecute and imprison citizens of countries that are not party to the Rome Statute and, more shockingly, over those who have specifically rejected the court's
jurisdiction. ...the ridiculous charges under Belgium's "Universal Competence" law against President George H. W. Bush, Secretary Powell, Vice President Cheney, and General Tommy Franks, among
others, for their roles in Operations Desert Storm and Iraqi Freedom - reinforce America's determination to protect itself from politically motivated criminal allegations. ...Unscrupulous individuals and groups
will seek to similarly misuse the ICC for politically motivated attacks. America is uniquely vulnerable to these kinds of charges... Since the
vast majority of the court's discretion lies within the Office of the Prosecutor, the ICC offers little opportunity to resolve these issues diplomatically and, because of its lack of appropriate checks and
balances to prevent it from being misused, represents a dangerous temptation for those with political axes to grind. Americans need more reliable protection than the goodwill and good judgment of an
international legal bureaucrat. ...
Monday, June 21, 2004 ~ 3:19 p.m., Dan Mitchell Wrote: In healthy American industries the real drama takes place in the scramble for market share. So it says a lot about the airline industry
that most of its excitement these days occurs in Washington, as with United's ongoing attempt to cadge a $1.6 billion taxpayer loan guarantee. ...The biggest villain here is Congress. The Members would
rather pass the buck to the ATSB than fix the regulatory and tax problems that have crippled U.S. airlines. It could amend the Railway Labor Act, which gives organized labor the whip hand in salary talks
with management. Or let carriers attract foreign capital the way other American businesses can; or cut the federal taxes and fees that take 26% of every $200 air ticket, or get out of the gate-distribution
business. It could even enact pension reform worth the name, allowing airlines to modernize their costly retirement plans. We sympathize with
United's plight, but the taxpayers shouldn't have to pay for Congress's failures.
Monday, June 21, 2004 ~ 2:57 p.m., Dan Mitchell Wrote: ...the opposition Democratic Party of Japan proposed a 3% consumption tax increase in order to prop up the country's ailing
pension system. Speaking on what is expected to be one of the key issues in the forthcoming election, the party suggested that increasing the consumption tax to 8% would prevent the pension system from
collapsing under the combined weight of a rapidly ageing population and declining birth rates.
Monday, June 21, 2004 ~ 11:39 a.m., Dan Mitchell Wrote: The Bush administration is opposing a provision in a US House bill that bars companies based overseas such as Tyco International Ltd. from
competing for Homeland Security contracts, saying it could violate World Trade Organisation rules and other agreements. "The pending legislation is overly broad and may have unintended negative
consequences," the White House Budget Office said in a statement. ...Companies based in the low-tax countries won $1.1 billion worth of defence and homeland security contracts in fiscal 2002, said
Representative Richard Neal, a Massachusetts Democrat who backs the contract provision. ...Tyco spokeswoman Gwen Fisher said the provision limits competition. The Bermuda-based company, the world's
biggest maker of security systems, industrial valves and duct tape, is run from West Windsor, New Jersey, and employs 100,000 people in the US.
"We believe decisions like this both affecting the safety and livelihood of Americans should be based on who can provide the best goods and services at the lowest price and should not be based on where the
company is incorporated," Fisher said.
Monday, June 21, 2004 ~ 11:23 a.m., Dan Mitchell Wrote: The United Kingdom's successful fight to retain a national veto on the issue of taxation generated a significant amount of friction
in talks on the European Constitution in Brussels last week, particularly with the French leader Jacques Chirac. British Prime Minister Tony Blair went into the talks after telling the House of
Commons last Wednesday that "there is no way we are going to have tax harmonisation or other people deciding on our tax rights." It was a position that angered the governments of
Germany and France who were dismayed on the lack of progress made in the talks between 25 European heads of state. "The ambitions foreseen [for the constitution] are reduced, especially
on tax and social security, by the clear position of one country, essentially the United Kingdom," commented President Chirac on emerging from the discussions last week. "I fear we will not be
able to progress as far as we should. And so we would hold back a Europe that could avoid being blocked by a single country," the French leader added.
Monday, June 21, 2004 ~ 10:26 a.m., Dan Mitchell Wrote: US Treasury Secretary John Snow told a conference last Thursday that the United States must continue cutting taxes and rolling back excessive
regulation and 'big' government if it is to counter the economic threat posed by emerging economies such as China and India. ...he also looked
back to the policies of the late Ronald Reagan as a blueprint for future tax policy. "Reagan saw that taxes were out of control, that government had grown far too much, like a weed that seems harmless
but can choke a tree – not intentionally, but due to its own growth," he told the audience, adding: "So Reagan took brave steps to cut taxes
dramatically, and continue the regulatory reforms of the 1970s…and these actions led to some of the greatest economic times our country has ever known."
Monday, June 21, 2004 ~ 10:00 a.m., Dan Mitchell Wrote: According to The Chronicle of Higher Education: "State leaders are often foggy on what exactly the various programs do, and it takes many
years for supporters of the programs to gather tangible evidence of their long-term impact." Apparently the state legislators have not been
too foggy to spend $85 million of the taxpayers' money to bankroll this program that apparently cannot show hard evidence of serious improvement in math and science, as a result of balloons flying across
the room in this "good place." As for needing "many years" to document their success, that is a strange claim. I once ran a six-week
summer program in economics for black students and documented its results simply by giving the students an economics exam at the beginning and at the end -- both exams being sent away to be graded by
others at the Educational Testing Service in Princeton. Why would it take "many years" to show any tangible improvement in math and
science by the students in California's $85 million program? Or is this just a way of postponing accountability -- indefinitely? Even if we take
it on faith that it really does require "many years" to produce results, the cold fact is that this program has been going on since 1970. That's 34 years. Is that not yet "many years"?
Monday, June 21, 2004 ~ 9:39 a.m., Dan Mitchell Wrote: Mr Blair defended the deal and sought to expose what he called "myths" about the EU. ...Mr Blair is likely to want to wait before
holding a referendum, giving treaty supporters time to turn around public opinion with 2006 being pencilled in as a possible date. The opposition Conservatives, on the other hand, are expected to ask for a
snap poll in order to capitalise on a rise in eurosceptic opinion - demonstrated at the European elections on 13 June.
Monday, June 21, 2004 ~ 9:15 a.m., Dan Mitchell Wrote: ...the famous Contract with America that swept Republicans into power in Congress in 1995 turns 10 years old. The Contract was a bold and
sweeping agenda to change the way government works in Washington. ...Republicans were going to make government "smaller and smarter. We are going to prove that we can get rid of programs, not just start
them." That was a highly appealing promise to voters as the federal budget under President Bill Clinton approached $2 trillion. ...Even in the fight to cut government down to size, there were some early
impressive victories. In the first two years of the Gingrich revolution, the federal budget actually was reduced after inflation by 3½ percent. The only other two-year period where that happened was in Ronald
Reagan's first two years as president. There was clearly a new ethic of fiscal restraint, rather than fiscal expansionism. ...Perhaps Republicans overpromised, but in the end, politics triumphed over good fiscal
common sense. Ten years later, most of the useless programs still flourish. ...The budget of $1.5 trillion in 1995 will likely reach $2.5 trillion this year. The war against big government was fought - at times
valiantly - but eventually lost. ...It's tragic that today many of those same Republicans who led the Contract with America siege on Washington have settled into power, have become overly comfortable
with their perches of authority, and have in some ways become mirror images of what they replaced. The Republicans now spend more than even the Democrats did when they ran Capitol Hill. Republicans seem to
have forgotten who they are, and why voters put them there. ...Perhaps it is time for conservatives to start plotting the next revolution.
Sunday, June 20, 2004 ~ 11:17 p.m., Dan Mitchell Wrote: In Why is Manhattan So Expensive? Regulation and the Rise in House Prices (NBER Working Paper No. 10124, coauthors Edward Glaeser,
Joseph Gyourko, and Raven Saks conclude that the piecemeal regulation of new construction has reallocated property rights from landowners to existing residents, public commissions, and ad hoc
collections of vocal, well-funded, opponents. The successful use of the regulatory process to block new construction has thus imposed a regulatory tax on homeowners. ...Because prices of existing homes rise
when new construction is constrained, existing residents have a strong incentive to manipulate political and regulatory processes to limit new construction. In Manhattan, the authors estimate these activities
increase apartment prices by an amount equal to a regulatory tax of about $7,382 per apartment per year, or about 50 percent of housing costs for these condo owners. ...Because housing in other boroughs is
far more reasonable than in Manhattan, the authors calculate that New York City's overall regulatory tax was 12 percent of a house's value in 1999. The San Francisco, San Jose, Oakland, and Los Angeles markets,
all in California, which is "well-known as the epicenter of the restrictions on new construction," had regulatory tax ratios ranging from 32 percent to 50 percent of a house's value. Washington DC,
Newport News, and Boston had regulatory taxes of about 20 percent. These markets were the exception. Over half of the housing markets examined by the authors imposed minimal regulatory taxes on homes.
Taxes on homeowners in Chicago were 6 percent. In Cincinnati, Birmingham, Minneapolis, Tampa, Houston, Philadelphia, and Providence, homeowners paid no regulatory tax at all.
Saturday, June 19, 2004 ~ 12:20 p.m., Dan Mitchell Wrote: Countries that were supposed to rejuvenate the EU with their neophyte energy seem to have lost their enthusiasm almost before they joined.
What's happened? ...perhaps most astonishing, was the demand, repeated several times in the last few weeks by German Chancellor Gerhard Schroeder, that new member countries increase their corporate
taxes to French and German levels. Never mind that the demand had no basis in European law and could never be enforced. What Mr. Schroeder took to be an uncontroversial statement of mild
Euro-socialism, voters in Central Europe heard as a direct challenge to their own aspirations for prosperity. ...Unless the EU unites the peoples
of Europe before it proposes greater unification of its own institutions, it will suffer another defeat. The draft Constitution -- wordy, obscure and collectivist -- is not likely to persuade those who voted for
Euro-skeptics Sunday. And until Sunday's nonvoters are reinvigorated, the document is unlikely to be ratified in referenda that have been pledged in several countries, including in Central Europe. Much better
that governments agree to put the draft Constitution in the freezer than for electorates to reject it. It is not too late to spare the EU a humiliation it does not need.
Saturday, June 19, 2004 ~ 10:45 a.m., Andrew Quinlan Wrote: Tanasescu said the cut in corporate profit tax is likely to be from the present 25% down to 19%, whilst the top rate of personal income tax
will be cut from 40% to 38%, and the lower rate from 18% to 14%.
Friday, June 18, 2004 ~ 4:35 p.m., Dan Mitchell Wrote: When it came to controlling deficit spending last year, words were abundant but deeds were in short supply on Capitol Hill. That's the
conclusion of the latest VoteTally study by the non-partisan National Taxpayers Union Foundation (NTUF). Even though lawmakers invoked the rhetoric of fiscal responsibility at least 1,046 times in the
Congressional Record, 2003 is the third successive year in which no Member of the House or Senate cast votes whose cumulative effect would reduce federal spending. ...The average Senator voted to boost
yearly expenditures by $302.2 billion, while the average House Member's net voting agenda totaled $231.7 billion for the 108th Congress, 1st Session. ...All told, the average House Member voted for
just 2 cents in spending cuts for every dollar in spending increases. Senators backed 5 cents in reductions for every dollar of increases.
Friday, June 18, 2004 ~ 4:17 p.m., Dan Mitchell Wrote: The move by the House Appropriations Committee to block consulting firm Accenture from receiving a $10 billion homeland security contract
because it is headquartered in Bermuda appears to have fallen at the first hurdle this week. The Appropriations Committee voted 35-17 last Wednesday to modify the Department of Homeland Security's $32
billion budget in order to prevent the Bermuda-based company from taking up the contract, on the grounds that it would not be paying its fair share of US taxes. ...When the legislation came to the
Republican-dominated House floor on Wednesday, a 234-197 vote ensured that the language blocking the awarding of the contract to Accenture is likely to be removed. However, the bill is expected to retain
a provision barring the Homeland Security Department from entering into contracts with companies based offshore in the future, meaning that the Accenture deal could be the last of its kind.
Friday, June 18, 2004 ~ 4:03 p.m., Dan Mitchell Wrote: U.N. Secretary-General Kofi Annan rebuked the United States for trying to get another exemption from prosecution by the new
International Criminal Court and urged the Security Council to oppose the measure. He is expected to press his case at a luncheon with council ambassadors on Friday. ...The Bush administration argues that the
tribunal, based in The Hague, Netherlands, could be used for politically motivated law suits against American soldiers.
Friday, June 18, 2004 ~ 1:47 p.m., Dan Mitchell Wrote: H. Walker Feaster, the inspector general of the Federal Communications Commission, told an investigative subcommittee June
17 that the abuses uncovered so far in the schools and libraries program of the universal service fund, referred to as the E-Rate program, are
just the "tip of the iceberg." ...The E-Rate program, short for education rate, was established as an amendment to the 1996 Telecommunications
Act by Sens. Olympia Snowe (R-Maine) and John Rockefeller (D-W.Va.). The program provides up to $2.25 billion annually in discounted telecommunications equipment and Internet access to schools and
libraries nationwide. But almost since its inception, the program has been plagued by fraud and abuse, ranging from equipment sitting unused in warehouses, to the purchase of redundant equipment, to
improperly transferred equipment. "In my own state of Texas, an El Paso school district purchased one year of IBM network maintenance services that amounted to about $270,000 per every school--including
elementary schools--just to ensure a brand-new network was running properly," said Rep. Joe Barton (R-Texas), chairman of the full committee. ...Feaster said that over the past year, 122 audits had been
conducted by the USAC and the FCC's Office of Inspector General, and that 39 of those audits (or 32 percent) had been found to be noncompliant with program rules. The remaining audits, or 83 of them,
were found to have some "finding" related to USAC implementing procedures, he said.
Friday, June 18, 2004 ~ 8:19 a.m., Dan Mitchell Wrote: The United States Postal Service (USPS) has decided to terminate its sponsorship of the U.S. Pro Cycling Team... Since the USPS renewed
its sponsorship contract in 2000, postal management has spent $25 million on the team. Adding $12 million in earmarked advertising expenses, plus charges for sending postal employees on junkets to
France, brings the total cost closer to $40 million, or about $8 million a year.... postal managers deserve censure for blowing precious ratepayer
dollars on this folly during times of serious financial stress. The USPS claimed that the sponsorship brought in money, saying that it generated
$18 million in revenue over a four-year period. However, the USPS Office of the Inspector General (IG) was able to document only $684,000 of that alleged $18 million. The IG also found widespread
weaknesses and accounting lapses in all of the USPS's sports-sponsorship programs. Even if the figure were accurate, only a government bureaucracy would brag about earning $18 million in
revenue on a $40 million investment. Ironically, the market where "brand awareness" might have had a favorable impact as a result of the cycling sponsorship is Europe, where the sport is wildly
popular....the U.S. Postal Rate Commission ...showed that not only was the USPS losing money in Europe, but that those mail services were being cross-subsidized with first-class ratepayer money. ... It would be
somewhat incongruous for postal officials to claim that most of its financial woes are caused by onerous statutory constraints out of their
control while they jet off to watch the Tour de France wrap-up in Paris. Based upon the public pronouncements of postal executives about
wanting to retain the mail monopoly while they "grow the business," ratepayers ought to be very concerned that same people who chose to
waste tens of millions of dollars on the U.S. cycling team may soon be free to leverage their chronically inefficient and wasteful bureaucracy into new money-losing ventures. The cycle continues.
Friday, June 18, 2004 ~ 7:39 a.m., Dan Mitchell Wrote: ...higher taxes erode the freedom of the individual. Necessary as taxes may be, we must not forget that by their very nature they restrict our
freedom. In 1995, Treasury debt in Iceland was equivalent to more than 50 percent of GDP. Next year it is forecast to be down to 15 percent of GDP. The Icelandic Treasury is in a solid position and Iceland's
international credit rating has never been better This success has been achieved not in spite of extensive tax cuts but, to a great degree, because of them.. In the early nineteen-nineties, corporate income tax
was 50 percent. The Government cut it first to 30 percent and later to 18 percent, and Treasury revenues and economic growth actually increased as a result. Personal income tax has already been lowered
and during the current government's term of office it will be reduced by a further four percentage points. An income tax surcharge on the highest incomes will also be removed, and inheritance tax has been
reduced... Economists are now forecasting robust growth in Iceland as far ahead as the year 2010. Continuous output growth has taken place since 1995, and last year it amounted to 4 percent. ...There is another
and perhaps equally strong reason that Iceland does not want to join the EU. A strong trend towards centralisation and integration seems to prevail within the Union and it appears to be heading towards
becoming some kind of federal state. ...Advocates of a single Community tax policy are now making their voices heard. Germany's Chancellor Schröder recently stated that corporate income taxes should
be harmonised within the EU. And that they should be brought towards Germany's current corporate income tax rate of 43 percent. Iceland does not want to follow such a course. We know from experience that
low taxes are a driving force behind the economy and that nothing dampens people's energy as much as watching most of the money they earn being taken away by the state. I believe it is absolutely vital that
nations should compete to offer the best environment for businesses to operate in. Exactly the same arguments apply there as to competition by businesses in the marketplace. Competition imposes discipline and
inspires new ideas, which is particularly necessary in the case of the state and how it exercises its authority.
Thursday, June 17, 2004 ~ 8:42 p.m., Dan Mitchell Wrote: Here's another sign that the economy is cooking: State revenues have started to flow again at the milk and honey rates of the late 1990s.
...Who knows, it may finally even put an end to the political wailing that state capitals are starved for cash. OK, not in New Jersey, where Governor Jim McGreevey is proposing to raise taxes for the second
time in his term, even though revenue is rising at a 7.6% clip. Individual income tax withholding in New Jersey rose by 10% in the first quarter --
double digits! -- but Mr. McGreevey is still campaigning to raise individual income tax rates despite vowing not do so when he ran for the office. He's apparently shameless. Meanwhile, across the country,
Governor Arnold Schwarzenegger's decision to hold the line against tax hikes is being rewarded, as California's revenue increased by 11.1%, including double-digit gains in personal, corporate and sales taxes.
Estimated 2004 tax payments on non-wage income in the Golden State also rose by 18.4% in April, suggesting even stronger revenues to come. ...The big political lesson here is that revenues always come back, and
quickly, when economic growth does. Politicians who control the growth of spending during the booms are better able to ride out the downturns. It'd be nice to think more of them will show such discipline
during this current expansion, but history doesn't leave us optimistic.
Thursday, June 17, 2004 ~ 11:09 a.m., Dan Mitchell Wrote: Any outside observer can see plainly that the whole project has gone off the rails. Originally proposed to simplify and make more transparent the
operations of the European Union, the result of over a year of consultations and deliberations is nigh on 300 pages of gobbledy-gook. And this week has featured the important showdown between the
Netherlands and Germany over whether the word "propose" or "recommend" should appear on page 90. Our opinion on this weighty
matter is that the constitution should have no page 90 if it is to make the EU more simple and transparent.
Thursday, June 17, 2004 ~ 10:41 a.m., Dan Mitchell Wrote: The second half of Mr. Howard's contained a promise to spend £49 billion ($90 billion) more on health and education every year than the
current government, which he has lambasted for its "tax and spend" approach. ...We'd like to think the British taxpayer is smarter than Mr.
Howard imagines, and would spot the inconsistency of promising greater choice while spending more of their money without asking them. And if this extra £49bn is really needed, it would make the "Right to
Choose" more expensive than the existing set-up, a decided drawback. Mr. Howard needs to decide whether he is a supply-sider in Margaret
Thatcher's mold or a Keynesian. Only then will the British public have a real choice in the election.
Thursday, June 17, 2004 ~ 9:21 a.m., Dan Mitchell Wrote: British Prime Minister Tony Blair June 15 threatened to scuttle plans for the new European Union Constitution if the European Commission does
not back off on tax laws. Blair said at his monthly news conference that he was "still in discussion on that issue but let me make it clear--it's got
to be absolutely clear that there's no way we are going to have tax harmonization or other people deciding on our tax rates." The prime
minister's official spokesman said "we simply didn't know whether that would happen at this stage," with an agreement on the constitution
being considered by the European Council over the coming weekend in Brussels. British Chancellor of the Exchequer Gordon Brown also said June 16 that U.K. opposition to majority voting on tax issues--as
opposed to the unanimous consent currently required--is based on "a concrete assessment of Britain's national interest and Britain and Europe's economic needs as we meet the challenges of the global
economy." Brown said in his annual speech that EU tax harmonization plans were "fatally flawed."
Thursday, June 17, 2004 ~ 7:39 a.m., Andrew Quinlan Wrote ...labor unions and government have regulated and taxed capitalists within an inch of their lives. Mr. Schroeder has publicly advocated
reforms, but the actual steps he has taken have been inconsequential. At the same time, he has revealed his emotional attachment to big government by pressuring central European countries that are joining
the EU to adopt Germany's high-tax/low-growth policies. This pressure is a nasty reminder for Germans of a lost opportunity. When the country was reunited, the SPD foisted the German regulatory state on East
Germany. The result has been economic catastrophe for that former communist country. The other former communist states that had to come of age without a "big brother" have outperformed East Germany
to an astonishing degree. GDP growth in Poland over the last year was almost 7 percent. The unemployment rate in former East Germany is almost 18.4 percent. The Germans now face what is to them an
unthinkable possibility. Their eastern neighbors are dramatically more successful than they are and may soon enough be richer. The costs of
their lazy socialism are apparent even to their children, and the country is in a panic. "We all recognize," one participant told me, "that Germany needs its own Reagan."
Thursday, June 17, 2004 ~ 7:27 a.m., Dan Mitchell Wrote: Speaking at a debate organised by the Swiss Bankers' Association last Thursday, Swiss Private Bankers Asociation president, Niklaus
Baumann reportedly revealed that financial burden imposed by the "millions of pages" of anti-money laundering and other regulations that
Swiss banks are obliged to follow represents 9.8% of the total costs of a small bank, and 4.1% of the total costs for a larger bank.
Wednesday, June 16, 2004 ~ 8:54 p.m., Dan Mitchell Wrote: "Based on our review of the bid by DHS legal counsel, all bidders were U.S. companies under law and therefore qualified to bid on the
contract," said Kimberley Weissman, DHS spokeswoman. ...Border and Transportation Directorate undersecretary Asa Hutchinson and U.S. Visit program manager Jim Williams told reporters at a press
conference that the Accenture unit that received the contract is based in the U.S. and pays U.S. taxes. ...Accenture never has been a U.S. company, he said. Andersen Consulting was formed in 1989 as part of
Andersen Worldwide, a Swiss-based cooperative organization. ..."Despite what some of our critics say, Accenture did not undertake a 'U.S. corporate inversion,'" McAvoy said. "Accenture LLP is our U.S.
entity and that is the organization that won the contract," he said. "As a global company, we pay, and have always paid, our fair share of taxes
in each of the countries in which we generate income, including the United States. We pay U.S. taxes on income generated by our U.S. operations," he said.
Wednesday, June 16, 2004 ~ 5:34 p.m., Dan Mitchell Wrote: The U.S. economy was stagnant, savaged by seemingly incurable inflation. The top capital gains levy was approaching 50%; venture
capitalism was nonexistent. The top personal income tax rate was 70%. Rampant inflation--tax brackets weren't indexed in those days--was slamming workers with massive unlegislated tax hikes by pushing them
into higher tax brackets. The average $18,000 income of the late 1970s left an earner less well-off than a $7,000 income had a decade before. Short-term interest rates climbed above 20%; home mortgage rates
reached 17%. What was even more dangerous was the attitude of policymaking elites here and overseas. The U.S. was in a historic long-term decline; how to manage this was the sad, necessary mission of
diplomats and political leaders. We were in an era of limits; we were running out of oil. Yet more government, more taxes and more rules and
regulations were the order of the day. ...He understood that the essence of economics is freedom and incentives. He pushed the still-radical idea
of massive, across-the-board cuts in personal income tax rates, as well as in the capital gains levy. He understood that taxes are a price and a burden. If you lower the price of productive work, risk-taking and
success, you'll get more of these good things. This wasn't abstract theory to him. Decades earlier, during his Hollywood career, Reagan had been told he shouldn't make more than two movies a year because
confiscatory taxes would take away virtually anything he earned beyond that. From then on Reagan could never understand why we tolerated a tax code that punishes people who want to do more, create more. His
huge 1981 tax cuts largely survived and helped set off a boom of innovation, invention and job creation that is still with us today. Income tax rates were slashed again in 1986--the highest bracket was only 28%.
Wednesday, June 16, 2004 ~ 5:16 p.m., Dan Mitchell Wrote: The last thing patients need is for the government to inject more socialism into their health care in the name of expanding coverage. To
borrow a phrase from President Reagan, government is not the solution to U.S. health care problems. It is the problem. ...The federal government effectively socializes 86% of all health spending, a greater
share than in 17 other industrialized countries, including Canada (though other features make these systems less free). By discouraging individual responsibility, the government guarantees irresponsibility. We
pay less attention to our health and demand more care - with little regard to the costs we impose on others or the rising prices that result. ...Estimates by Harvard economist Martin Feldstein suggest that the
federal government's quasi-socialization of private insurance alone will leave us nearly $200 billion worse off this year. Moreover, Chris Conover of Duke University estimates that health regulations will leave
us $128 billion worse off. Ronald Reagan demonstrated that free markets are superior to socialism. So why do we continue to tolerate socialism in our health care system?
Wednesday, June 16, 2004 ~ 4:43 p.m., Dan Mitchell Wrote: Gun control has not worked in Canada. Since the new gun registration program started in 1998, the U.S. homicide rate has fallen, but the
Canadian rate has increased. The net cost of Canada's gun registry has surged beyond $1-billion--more than 500 times the amount originally estimated. Despite this, the Canadian government recently admitted it
could not identify a single violent crime that had been solved through registration. ...When gun control laws fail--as they consistently do, whether in Canada, the United States or other countries--politicians
seek to pass new laws rather than eliminate the old ones. In the United States, gun-control groups now claim that the 1994 Brady Act implementing background checks and assault-weapon bans failed to
reduce crime only because they didn't go far enough; and that city bans on handguns in Chicago and Washington, D.C., failed only because other jurisdictions didn't follow suit. The same logic applies overseas:
With violent crime and gun crime soaring in the United Kingdom, where handguns are already banned, the British government is banning imitation guns. And in Australia, state governments are banning
ceremonial swords. ...the United States took the opposite approach and made it easier for individuals to carry guns. Thirty-seven of the 50 states now have right-to-carry laws that let law-abiding adults carry
concealed handguns once they pass a criminal background check. Violent crime in the United States has fallen much faster than in Canada, and violent crime has fallen even faster in right-to-carry states
than for the nation as a whole. The states with the fastest growth in gun ownership have also experienced the biggest drops in violent crime rates.
Wednesday, June 16, 2004 ~ 4:15 p.m., Andrew Quinlan Wrote: A recent addition to Banzhaf's agenda is to outlaw ladies' night, saying, "Different prices for men and women constitute illegal gender-based
discrimination, and perpetrators can be sued not only for monetary damages but in many cases also for attorney fees and punitive damages." He boasts that ladies' nights have been ruled illegal in
California, Colorado, Connecticut, Iowa, Maryland, Missouri, Nebraska, New York, Pennsylvania and recently New Jersey. It's fruitless to attempt to convince Banzhaf that price discrimination is a
benign, standard and routine pricing technique. It's even practiced by his legal profession. Professor Banzhaf's true agenda is tyrannical control of our lives. ...The bottom line here isn't ladies' night or
smoking. It's how we Americans are allowing tyrants to attack our liberties. If we allow them to continue, once we wake up we won't have enough freedom to stop them from turning us into a nation of serfs.
Wednesday, June 16, 2004 ~ 12:30 p.m., Dan Mitchell Wrote: In 2000, U.S. GDP per capita was a whopping 32% higher than the EU average. Europe's standing hasn't improved since then. ...Higher GDP
per capita helps the average American to spend about $9,700 more than the average European on consumption per year. Americans, therefore, have by far more cars, TVs, computers etc. than Europeans. "Most
Americans have a standard of living which the majority of Europeans will never come anywhere near," the study says. ...But what does it
mean to be poor in the U.S.? A large proportion of the "poor" (45.9%) own their homes, 72.8% have a car and almost 77% have air conditioning, still considered a luxury in most of Western Europe. The
average living space for poor American households is 1,200 square feet. In Europe, the average space for all households, not just the poor ones,
is 1,000 square feet. ...So why has Europe's economic development been so sluggish over the last 30 years? The authors say it is impossible not
to notice the one factor that essentially distinguishes large parts of Europe from the U.S., namely "the expansion of the political sphere in
general and taxes and the size of the public sector in particular." In 1999, average EU tax revenues amounted to over 40% of GDP; in the U.S. they were below 30% of GDP.
Wednesday, June 16, 2004 ~ 12:04 p.m., Dan Mitchell Wrote: Traditionally, constitutions are a means of limiting the power of government. But they can also be abused to legitimize powers that
governmental institutions have surreptitiously accumulated over time and to expand their competencies. So would this constitutional treaty protect liberty, or would it increase the power of government? ...the
draft extends EU powers in the coordination of social and health policies, research and technology, energy, sport, civil protection and space policy. This opens additional avenues for regulation. Moreover,
the centralization of these policies at the EU level would weaken political competition among the member states. Regulatory and tax competition among governments is the most effective protection of the
citizens' freedom -- as European history has shown. ...the draft constitution includes the EU Charter of Fundamental Rights, which so far has not been binding. This charter contains not only personal
liberties but also many legal claims to government action. For example, it asserts a right to "fair and just working conditions," "protection
against unjustified dismissal" or "housing assistance." Since the European institutions are obliged to "respect" these rights and
"promote the application thereof," the charter necessarily modifies, and in many respects increases, their powers. For these reasons, the
European Constitutional Group has come to the conclusion that the constitutional treaty contains some positive elements but on balance makes things worse. The treaty is a recipe for ever tighter regulation. It
would impair Europe's competitiveness in the global economy, and it is a serious threat to liberty. The constitution would have a limited direct impact on the European economy, but a negative one. By declaring the union to be "a social
market economy . . . aiming at full employment," and requiring its countries to "coordinate their economic policies," the constitution
would give political cover to France and Germany whenever they made further attempts to force their high taxes and rigid labor laws on to other EU countries. The seeding of the text with other sweeping
generalizations requiring, for example, a "prudent and rational utilization of natural resources," and a "high level of consumer
protection," without qualification, could easily provide justification for unlimited quantities of future product regulations. The constitution
would also fix in place even more securely the common agricultural policy, a wasteful regime of import controls and rigged markets, which undermines the credibility of the EU when it argues for liberalization in
other areas of world trade.
Wednesday, June 16, 2004 ~ 11:08 a.m., Dan Mitchell Wrote: ...the euroskeptics may prompt a shift to a more cautious stance on European integration. As such, analysts said, the election result may
have changed the face of EU politics. .Buoyed by their success at the ballot box, euroskeptics were promising to lobby the political center with their increased voters' base such issues as economic policy and a
new constitution. ...Jens-Peter Bonde, head of Denmark's June Movement and leader of the Group for a Europe of Differences and Democracy, the largest group of euroskeptic parties in the European
Parliament, acknowledged that even within the group, parties' ideologies differed widely. "But we all agree on one thing," he said. "We
don't want any more integration and we don't want that constitution." The rebellious mood was also reflected in growing disquiet about the EU, with a record number of Eurosceptic candidates returned to the
732-seat European parliament. The European elections gave 350m voters in 25 countries the chance to vote, but the mood of discontent was also reflected in a record low turnout of about 45 per cent - down
from 49 per cent in 1999. The results come just days before Europe's leaders meet in Brussels to try to agree the next phase of EU integration, by endorsing the draft constitutional treaty. Their ability to
sell the constitution to hostile voters, many of whom will be asked to ratify the treaty in national referendums, was called into doubt by Sunday night's results. Eurosceptics plainly had a field day. Newish parties wholeheartedly opposed to EU membership did well in two of the Union's biggest
countries. In Britain, the UK Independence Party (UKIP) drew Eurosceptic voters from the main opposition Conservative Party to take 17% of the vote, entitling it to 12 seats in the parliament. In Poland, a
traditionalist and ruralist party, Samoobrona (Selfdefence), came third, nabbing seven seats. (Two other right-wing parties, the crime-bashing
Law and Justice and the Catholic-nationalist League of Polish Families, also did well.) Two parties in Austria and the Netherlands, though not strictly Eurosceptic, campaigned successfully against corruption and
mismanagement in Brussels. In short, EU business-as-usual was a big loser at last week's polls.
Wednesday, June 16, 2004 ~ 9:19 a.m., Dan Mitchell Wrote: In an effort to reach a compromise agreement on a new European Union constitution, a majority of EU member states expressed a
willingness June 14 to drop an amendment that would allow certain proposals dealing with taxation issues to be decided by qualified majority voting (QMV) instead of unanimity. ...Throughout the past
year the United Kingdom, with strong support from Ireland, has spoken out against the draft EU constitution amendment that would allow legislative proposals dealing with tax fraud to be decided by qualified
majority voting. ...British officials say the amendment on taxation, although it deals only with tax evasion and fraud, is just a prelude to other proposals including corporate tax harmonization. Irish officials
said countries such as France, Germany, and Belgium expressed opposition to dropping the amendment calling for QMV on proposals for corporate tax fraud and evasion.
Tuesday, June 15, 2004 ~ 8:53 p.m., Dan Mitchell Wrote: The traditional family has for many centuries and in most countries been the core unit of society. It has been the foundation and even the
ultimate purpose in many people's lives. It has provided a stable framework to bring children into the world, to raise them, to teach them manners and how to become productive and happy human beings. It has
been relied upon for emotional and financial support, and in many other regards. All this is changing now. ...The welfare programs and benefits
imply that the family's role as a financial support unit has significantly decreased. A single parent will be provided well for by the government.
Likewise people will be provided for by the government if they are sick, handicapped, on maternity, getting old, unemployed etc. These are all circumstances where the family previously played an important role.
Tuesday, June 15, 2004 ~ 11:27 a.m., Dan Mitchell Wrote: A US House of Representatives Committee passed a measure last week that would block consulting firm Accenture from winning a $10 billion
homeland security contract because it is headquartered offshore. The House Appropriations Committee voted 35-17 last Wednesday to modify the Department of Homeland Security's $32 billion budget in order to
prevent the Bermuda-based company from taking up the contract, on the grounds that it would not be paying its fair share of US taxes. ...The bill's sponsor Rep. Rosa DeLauro, a Connecticut Democrat argued that:
"It is simply wrong for Homeland Security to award an expatriate with the largest corporate contract to date." "We have two competitors who are paying their taxes in the US," she added.
Monday, June 14, 2004 ~ 4:04 p.m., Dan Mitchell Wrote: "Optimism" is the perfect way to trivialize everything that Reagan was or did. ...Optimism? Every other person on the No. 6 bus is an optimist.
What distinguished Reagan was what he did and said. Reagan was optimistic about America amid the cynicism and general retreat of the post-Vietnam era because he believed unfashionably that America was
both great and good -- and had been needlessly diminished by restrictive economic policies and timid foreign policies. Change the policies and America would be restored, both at home and abroad. He was right.
...[Reagan's] success is an understandable embarrassment to the critics who opposed his every policy. They supported the freeze, denounced the military buildup, ridiculed strategic defenses, opposed aid to the
Nicaraguan anti-communists and derided Reagan for telling the truth about the Soviet empire. So now they praise his sunny smile. Normally, people speak well of the recently deceased to honor the dictum of being
kind to the dead. When Reagan's opponents speak well of him now, however, they are trying to be kind to themselves.
Monday, June 14, 2004 ~ 2:58 p.m., Dan Mitchell Wrote: ...many eurosceptic parties had their best result at the polls. ...Turnout reached a record low, with just 45.3% of EU voters casting ballots.
...Outgoing European Parliament President Pat Cox described the results as a "wake-up call" and warned European leaders that they had to demonstrate the EU's relevance to voters. ...The BBC's European
affairs correspondent William Horsley says the protest vote across the EU may push the heads of government to water down some of their integrationist ambitions. ...Germany's governing Social Democrats
recorded their worst result since World War II. Official results showed the party took just 21.5% of the vote, with the Christian Democrats set to be clear winners with 44.5%. ...In Poland, largest of the new EU
members, partial results indicated the anti-EU League of Polish Families came second with 16.4%, while the governing left party won just 9%. ...With all the ballots counted in the Czech Republic,
eurosceptic Civic Democrats won 30% of the vote to trounce the ruling Social Democrats, who only managed to poll 8.8%. ...Parties of the centre-right are expected to maintain their position as the biggest single
bloc in the new parliament when final results are announced.
Monday, June 14, 2004 ~ 6:40 a.m., Dan Mitchell Wrote: Today's politicians of both parties are obsessed with what the American people think. They instruct their pollsters, "Go and find out the views of
the American people, so that we can choreograph our positions to bring them into line with public sentiment." Undoubtedly many of them
believe this is a marvelous demonstration of democracy in action. But it was not the American Founders' view of democracy, nor was it Ronald Reagan's. Mr. Reagan knew we live in a representative democracy
where the American people choose leaders, whose job is to lead. In many cases, this means acting without consulting the people. Many times during the 1980s, Mr. Reagan came on television and said
something like, "My fellow Americans, I have just signed an executive order removing gasoline price controls." Or, "My fellow Americans,
yesterday I bombed Libya." In other words, Mr. Reagan typically did something, then told us why he did it and asked for our support. So Mr. Reagan did seek the approval of the American people, but not
necessarily prior to pursuing a course of action.
Sunday, June 13, 2004 ~ 2:18 p.m., Dan Mitchell Wrote: The relentlessly partisan New York Times could not resist using Ronald Reagan's death as a tawdry opportunity to denigrate his enduring,
internationally emulated accomplishments in economic policy. The editors concluded Mr. Reagan merely "profited from good timing and good luck" ...President Reagan gave the United States this lasting
legacy of lower tax rates to improve incentives for personal effort, investment and entrepreneurship. The results have been even better than contemplated in the so-called Rosy Scenario of 1981, and have
been emulated by dozens of other countries, including China, India, Ireland and Russia. Bewildered critics responded by spinning metaphysical theories exaggerating the costs of budget deficits and
benefits of surpluses. Yet none of their predictions came to pass. On economic success alone even aside from the critical impact of that
success in discrediting communism the facts permit only one credible verdict on President Ronald Reagan's awesome accomplishments: Score
another big win for the Gipper and another big loss for the sore losers.
Sunday, June 13, 2004 ~ 12:48 p.m., Dan Mitchell Wrote: Reagan's rhetoric and actions moved America closer to a country where we argue about denationalizing lighthouses. George W. Bush's rhetoric
and actions are moving us in the opposite direction. Last Labor Day, George W. Bush told a crowd, "We have a responsibility that when somebody hurts, government has got to move." Reagan would never
had said something like that. ...The current President Bush has lots of will and a wallet full of credit cards. On the domestic side, Bush has
asserted that the federal government has a central role in education - once a local concern - and he's backed that up with a 60 percent increase in federal funding. He's created a new Cabinet agency,
massively expanded entitlements in the form of a prescription drug benefit and asked for a major new commitment by the federal government to insert itself into everything from religious charities to
marriage counseling. And these are just a few examples.
Saturday, June 12, 2004 ~ 11:45 a.m., Dan Mitchell Wrote: Speaking on Tuesday, Irish Finance Minister, Charlie McCreevy announced that Ireland will continue to resist proposals for corporate
tax harmonisation within the EU, such as those recently put forward by France and Germany. Arguing that issues of tax policy ought to be determined democratically by individual Member States in the light of
their individual policy priorities, the Irish Finance Minister explained that: "Ireland had successfully and determinedly pursued a policy of low
personal and business taxation, including our 12.5 per cent rate of Corporation Tax, with spectacular success. We have created a dynamic employment and investment-friendly environment in which over
300,000 new jobs have been created and countless tens of thousands of existing jobs maintained over the past 7 years."
Friday, June 11, 2004 ~ 5:39 p.m., Dan Mitchell Wrote: I first met Ronald Reagan in 1967, shortly after he had become governor of California. ...I first realized what a truly extraordinary
person he was in early 1973 when I spent an unforgettable day with him barnstorming across California to promote his Proposition 1 -- an amendment to the state constitution that would set a limit to the amount
the state could spend in any year. We flew in a small private plane from place to place and at each stop held a press conference. In between, Gov. Reagan talked freely about his life and views. By the time we
returned to our final press interview in Los Angeles, I was able to give an enthusiastic yes to a reporter's question whether I would support Reagan for president. And, I may say, I have never been disappointed
since. ...To Mr. Reagan, of course, holding down government spending was a means to an end, not an end in itself. That end was freedom, human freedom, the right of every individual to pursue his own
objectives and values so long as he does not interfere with the corresponding right of others. That was his end in every phase of his remarkable career. We still have a long way to go to achieve the
optimum degree of freedom. But few people in human history have contributed more to the achievement of human freedom than Ronald Wilson Reagan.
Friday, June 11, 2004 ~ 4:51 p.m., Dan Mitchell Wrote: Mr. Giuliani called the Island's insurance sector "a haven after 9/11". "Bermuda played a big role," he said, adding that many Americans
"feel like the Island was the fifty-first state when they come here". For his part, he said he was "more than willing to come back whenever you
invite me". ...Mr. Giuliani said Sen. Kerry's view of Bermuda and the companies that moved here, was a "very narrow" take on how
economics work. Were he in the same shoes, he said he would "take a look at why companies feel so comfortable here and try and replicate that in America".
Friday, June 11, 2004 ~4:00 p.m., Dan Mitchell Wrote: When talking about Ronald Reagan, I have to be personal. We in Poland took him so personally. Why? Because we owe him our liberty. This
can't be said often enough by people who lived under oppression for half a century, until communism fell in 1989. Poles fought for their freedom
for so many years that they hold in special esteem those who backed them in their struggle. Support was the test of friendship. President Reagan was such a friend. His policy of aiding democratic movements in
Central and Eastern Europe in the dark days of the Cold War meant a lot to us. We knew he believed in a few simple principles such as human rights, democracy and civil society. He was someone who was
convinced that the citizen is not for the state, but vice-versa, and that freedom is an innate right. ...I distinguish between two kinds of
politicians. There are those who view politics as a tactical game, a game in which they do not reveal any individuality, in which they lose their
own face. There are, however, leaders for whom politics is a means of defending and furthering values. For them, it is a moral pursuit. They do so because the values they cherish are endangered. They're
convinced that there are values worth living for, and even values worth dying for. Otherwise they would consider their life and work pointless.
Only such politicians are great politicians and Ronald Reagan was one of them.
Friday, June 11, 2004 ~ 2:12 p.m., Dan Mitchell Wrote: Raids on journalists are common in police states -- but there's a remarkable case unfolding in Belgium. Here, a reporter who angered
the European Union's antifraud unit by exposing corruption found himself on the wrong side of the Brussels police force. ...Being the capital of the EU has brought prestige and about 1,000 foreign
correspondents to Brussels. But Belgium's essential role in the noble European project brings great responsibility. How can the EU ask new member states to adopt the rule of law and transparency when the
police are seizing journalists' files in Brussels?
Friday, June 11, 2004 ~ 8:30 a.m., Dan Mitchell Wrote: The national outpouring of emotion was an index of Mr Reagan's huge importance. There is a growing consensus that he was one of the most
consequential presidents of the 20th century... He presided over one of the great realignments of American politics as "conservatives of the
heart"-southerners, westerners and blue-collar workers-abandoned the Democrats for the Republicans. He launched the biggest peacetime build
up of the armed forces. He embarked on a radical economic policy of tax cuts and deregulation that terrified much of the establishment...but
that nevertheless helped to create a sustained boom... To understand Mr Reagan's importance you have to remember how the Republican Party used to be. In the 1950s, it was a party dominated by the east-coast
establishment, pragmatic in domestic affairs and internationalist in foreign policy. Dwight Eisenhower believed in containing communism abroad, not rolling it back; and in gently expanding government at
home, not shrinking it. Richard Nixon ran on almost the same platform as John Kennedy... The list of Mr Reagan's conservative triumphs is long. He began his presidency by pulverising organised labour, sacking
more than 10,000 members of the air-traffic-controllers' union for striking (even though the union had been one of the few to support his presidential bid). In 1981 he embarked on one of the biggest tax cuts in
American history; before long the top marginal rate of income tax had fallen from 70% to 28%, weakening the progressive principle that Democrats cherished. He gave a push to the deregulation movement
which had already started under Mr Carter. All this was driven by a clear ideological agenda: get the government off people's backs (partly by starving the beast) and unleash entrepreneurial forces.
Thursday, June 10, 2004 ~ 6:54 p.m., Dan Mitchell Wrote: The EU has made it clear that it would like to implement the savings tax accord at the beginning of next year. But the Swiss argue that this
deadline is unrealistic because the accords have first to be debated by parliament, something which is not expected to happen before the end
of the year. Swiss voters are also likely to be given the final say in a nationwide vote on whether to accept the package of accords. ...But
even if debate is wrapped up by the end of the year, the government will still have to wait for a period of three months to see if those opposed to
the treaties launch a referendum against them. "The inescapable fact is that Switzerland cannot meet the January deadline," said Roger Kaiser,
tax adviser at the European Banking Federation, which represents 20 national bank associations. ...Swiss and European banks are unlikely to be disappointed by the delay.
Thursday, June 10, 2004 ~ 5:12 p.m., Dan Mitchell Wrote: More than any modern president, Reagan understood the link between economic growth at home and American strength overseas. It was the
Gipper's most brilliant insight. He acted swiftly to show our enemies that we would produce the necessary economic resources to do whatever it would take, for however long was necessary, to triumph
over the communist menace. Immediately upon assuming office, he reversed the economic policy of the decline years. He brought down marginal tax rates, restoring the incentives necessary for economic
growth. ...The greatness of Ronald Reagan was his optimistic vision. His unequivocal belief in freedom and democracy, in America as a city on the hill, never faltered. His free-market prescription for economic
growth relied on the creativity of ordinary people working in free enterprise rather than government planning. He believed in entrepreneurship, not welfarism. He understood how to use military
power. And his optimistic faith in America gave a moribund country a new life. Reagan saved America.
Thursday, June 10, 2004 ~ 3:30 p.m., Dan Mitchell Wrote: Everyone talks about the Reagan tax cuts, yet there is more to President Reagan's legacy than tax cuts. There is also his courageous and largely
unappreciated willingness to fight for reductions in domestic spending. At the end of the day, for all the missed opportunities of the Reagan
administration to restrain spending, his accomplishments - presented in tables below - on the spending side of the budget constitute a true revolution. Ronald Reagan sought - and won - more spending cuts than
any other modern president. He is the only president in the last 40y years to cut inflation-adjusted nondefense outlays, which fell by 9.7
percent during his first term ...President Reagan cut the budget of eight agencies out of fifteen during his first term, and ten out of fifteen during
his second term. President Clinton cut the budget of nine out of fifteen agencies during his first term but cut none during his second term. President George W. Bush has cut none of the agencies' budgets during
his first term.
Thursday, June 10, 2004 ~ 3:15 p.m., Dan Mitchell Wrote: In a widely watched GOP Senate primary, voters sent a message that protectionism no longer sells, not even in textile country. Former
Governor David Beasley, a protectionist-come-lately, took 37% of the vote in a multi-candidate field. But the news is that he was forced into a
runoff, as voters gave 26% and 25% respectively to the two committed free-traders in the race -- Representative Jim DeMint and businessman Thomas Ravenel. ...Mr. DeMint's election would also send a message to
what has become a nominal Republican Senate "majority" in Washington. He has used his time in the House to promote tax cuts, entitlement reform and ways to trim spending. At a time when the GOP
Senate can't even work up the nerve to make permanent the Bush tax cuts that revived the economy, Mr. DeMint's arrival might remind a few time-serving Republicans why they came to Washington in the first
place. Meanwhile, Palmetto State voters also rendered a verdict against overspending. ...On Tuesday, at least two GOP state legislative incumbents lost their primaries, and another three have been forced into
run-offs. One of the casualties was House Majority Leader Rick Quinn, who lost to a political newcomer who'd stressed fiscal conservatism. The
underlying lesson here is that voters are looking for politicians willing to stand for something. Protectionism may look alluring in the polls, but
voters will gladly vote for a candidate who can explain the benefits and importance of competing successfully in the global economy. Voters are
also tired of Republicans who claim to be for smaller government but then vote to tax and spend to perpetuate their incumbency. Did we say something about a tribute to Ronald Reagan?
Thursday, June 10, 2004 ~ 2:10 p.m., Dan Mitchell Wrote: Putin has already changed Russia. "It's not the same as the Soviet era," says Al Breach, chief economist for Brunswick UBS, a Moscow
brokerage. "The Putin reforms are about giving individuals more liberties, lowering the tax burden, and reducing administrative hassles.
He's trying to get the state's back off individuals and support private enterprise." ...Russia's growth is also being driven by a surge in
productivity across all sectors -- a predictable result of the market reforms launched in the 1990s and continuing, with much greater consistency, under Putin. ...Putin's reforms are also giving companies
and workers good reasons to emerge from the shadow economy. Aton estimates that between 1998 and 2002, the black market's share of Russia's GDP shrank from 45% to 37%. A big reason behind this shift:
Putin's decision to slash the personal income tax to a flat 13%. That brought millions of citizens onto the tax rolls. With their taxes lower,
many workers now are pressuring employers to report their full income. ...One of his biggest goals now is to help private businesses by slashing
red tape. Putin plans to pare the number of bureaucrats by 20%: He has already cut back the size of his Cabinet. And he plans to slash the number of licenses and permits required to register and run a private
business. Coincidentally, today's Daily Report from the Bureau of National Affairs reports that the Russian government is planning further tax reductions: Russian Deputy Prime Minister Alexander Zhukov June 4 repeated the government's intention to further reduce the value-added tax rate in
2006. His comments, which were made at a conference on corporate governance, have sparked fresh expectations of changes to Russia's tax laws. The standard rate of VAT in Russia dropped from 20 percent to 18
percent Jan. 1. Zhukov said the government may lower the rate an additional 2 percentage points to 3 percentage points in 2006.
Thursday, June 10, 2004 ~ 12:45 p.m., Dan Mitchell Wrote: ...This comparison with the USA as a whole is of course interesting as a point of departure, but it is important to remember that the USA is an
entire continent. It includes geographically defined regions which can present considerable differences in prosperity, growth and circumstances, and so the comparison between Europe and the USA can
be deepened by comparing states of the USA with European countries. That comparison too makes dismal reading from a European viewpoint. ...there is really just one European country which can rival any of the
states of the USA, namely Luxembourg. The success of that country can to a great extent be put down to a heavy inflow of foreign capital. All
the other European countries come in the lower half of the scale. There is a very wide gap - something like 100 per cent - between the great
majority of European courtiers and the more affluent states of the USA. Connecticut, for instance, has almost twice the material prosperity of old European great powers like France and the UK. Only four
American states are relatively poor by European standards, but here the differences are nothing ...Per capita private consumption is far higher in the USA than in most European countries. American private
consumption is 29 per cent higher than in Luxembourg, the country with the highest private consumption in Europe. Compared the average (EU 15), the difference in consumption is very great. In the USA the average
person spends about 9,700 more on consumption annually, a difference of 77 per cent. The average American, in other words, spends nearly twice as much (77 per cent more) on consumption as the average EU
citizen. This is due to a higher level of GDP but also to taxation policy.
Wednesday, June 9, 2004 ~ 5:07 p.m., Dan Mitchell Wrote: Philadelphia has learned the hard way what it's like to watch businesses and jobs flee to more competitive tax locales. One of the most heavily
taxed cities in the nation, Philly has lost 250,000 jobs and 430,000 residents since 1970. Residents have increasingly demanded a reduction in a state and local tax burden that takes 14.5% of income (versus 9%
in the nearby suburbs), but city politicians have refused to listen. Which is why 80% of Philadelphians voted in 2002 to establish a Tax Reform Commission, the sole job of which was to "recommend methods to
reduce the taxes of Philadelphia residents, workers, and businesses in an equitable manner in order to enhance Philadelphia's ability to
compete..." ...The Commission proposed a sharp reduction in the city's crippling wage tax, which at 4.5% is more than twice the average of the
few other urban areas that even levy such a fee. It also called for axing the "business privilege tax," which allows government to tax both
business gross receipts and net income. ...Even more encouraging was the body's enlightened view of how to "finance" these cuts: "The
Commission is confident that economic growth over the long run will increase tax revenues sufficiently to offset the temporary impact of reduced tax rates." It predicted the tax cuts would create 47,000 new
jobs by 2010, resulting in a broader tax base that would "recapture" lost tax revenues. Where have we heard this before? Ah, yes, this week we can dare to call it Reaganomics...
Wednesday, June 9, 2004 ~ 4:49 p.m., Dan Mitchell Wrote: Amid all the affection and adulation for Ronald Reagan, one of his greatest achievements stands all but overlooked. He helped subdue
double-digit inflation, setting the stage for the prolonged economic expansions of the 1980s and 1990s. High inflation largely brought Reagan to power; low inflation made his presidency popular and
successful. ...When Reagan asked, "Are you better off than you were four years ago?" he was referring mainly to inflation. ...By 1982 inflation was down to 3.8 percent. On an annual basis, it has never
again topped 6.1 percent (1990). From 1969 to 1981 (12 years), there were four recessions. In the 1973-75 recession, monthly unemployment reached 9 percent; in 1981-82 it hit 10.8 percent. Since 1982 there have
been two recessions (1990-91, 2001). The highest monthly unemployment rate was 7.8 percent in June 1992. The suppression of double-digit inflation liberated the economy from stop-go policies:
bursts of expansion followed by punishing slumps. It restored a sense of order and predictability. ...In private meetings with Volcker and others,
he favored tight money. In public, he supported Volcker by muting any criticism. The Fed could proceed with the wrenching -- and necessary --
job of purging inflationary expectations. Reagan provided the essential political cover. ...No other major leader -- Republican or Democrat --
would have then done what Reagan did. "The President stands almost alone among Washington's current politicians in his instinctive comprehension that inflation is a profoundly destructive phenomenon,"
wrote David Stockman, Reagan's first budget director, in an otherwise critical 1986 book. Giving "Volcker the political latitude to do what had
to be done . . . was a genuine achievement." More than genuine, it was magnificent.
Wednesday, June 9, 2004 ~ 3:27 p.m., Dan Mitchell Wrote: Reagan's greatest achievement was to mobilize moralism and pragmatism in a way that eventually toppled the Soviet Union. He
dared to reject the notion that the Soviet "evil empire" was a fact of life just because the Russians had nuclear weapons. Reagan backed up that
commitment by fighting proxy wars in Nicaragua, Angola and Afghanistan. But by the late 1980s, he was engaging Mikhail Gorbachev in a web of agreements on arms control and human rights -- helping
foster a process of change inside the Soviet Union that ultimately destroyed communist rule.
Wednesday, June 9, 2004 ~ 11:11 a.m., Dan Mitchell Wrote: According to a survey conducted by the Eurostat data agency and released on Thursday, Luxembourgers came top of the EU's 'rich list'
last year, with the Irish in second place. Having undertaken a comparative analysis of gross domestic product (GDP) levels per capita in each of the 25 EU member states, Eurostat revealed last week that
Luxembourg's residents enjoyed around 208% of the EU average GDP per capita in 2003.
Wednesday, June 9, 2004 ~ 1:45 a.m., Dan Mitchell Wrote: Mourners who made it through the traffic reported waiting up to eight hours for one of the shuttle buses at Moorpark College. Visitors had to
pass through metal detectors, get their belongings searched and surrender cell phones and cameras. There was another wait at the library itself. But most visitors had few complaints. "He gave us eight
years of service," said Keith Godliman, 50, of Santa Clarita. "It doesn't hurt for us to wait eight hours for him." ...The public expression of
sympathy began after Reagan's body, accompanied by wife Nancy Reagan, 82, and his children, was brought Monday from a Santa Monica mortuary to the library in the Ventura County hills northwest of
Los Angeles. ...Charles Shelton, 38, a Los Angeles lawyer, was struck by the range of people. "It's a testament, how broad his appeal was," said
Shelton, who voted for Green Party candidate Ralph Nader in 2000 and plans to vote for Democrat John Kerry but called himself a "Reagan
Republican." ...Salvador Ayala, 74, came from Simi Valley with three other veterans. "He won the Cold War without firing a shot. He was the
greatest president that we ever had, and I'm a Democrat," said Ayala, who served in the Korean War.
Tuesday, June 8, 2004 ~ 11:31 a.m., Dan Mitchell Wrote: Reagan came to office at a time when America faced the worst economic crisis since the Great Depression. Inflation and unemployment
were at double-digits. Top federal tax rates were 70 percent, smothering incentives for risk-taking and private initiative. Galloping inflation
meant unlegislated tax increases each year as households were shoved into higher tax brackets without a corresponding rise in real incomes. ...The Reagan deficits continue to be viewed as a blemish on his
economic record, but this is based on zero-sum analysis and single-entry accounting. The national debt increased by $2 trillion during the Reagan
presidency. However, household net worth rose by $8.7 trillion. This means that for each dollar of national-debt increment, there was a parallel $4.35 increase in America's balance sheet. Since federal
revenues doubled during Reagan's two terms, it is highly misguided to blame the deficits on Reagan's tax cuts. Had top rates of taxation remained at 70 percent, the Reagan recovery would not have emerged
and the deficits would have been worse. A lasting tribute to Reaganomics is that pro-growth policies are spreading around the world - like wildfire. ...A Chinese government official recently stated that
plans for a new corporate tax overhaul would "look a lot like Reaganomics." The Baltic states have adopted flat taxes ...Ireland recently slashed income-tax rates while implementing a stunningly
pro-growth 10 percent corporate tax rate. The road to these reforms was paved in the 1980s as Reagan slashed tax rates in the U.S. and British Prime Minister Margaret Thatcher cut them in Europe. In the
ultimate irony, Russia has become the most recent convert to Reaganomics. Russian President Vladimir Putin implemented a 13 percent flat income tax in 2001. Putin did one more for the Gipper by
slashing corporate rates in 2002. These reforms have unleashed double-digit dollar growth rates of gross domestic product while tax revenues have shot up...
Tuesday, June 8, 2004 ~ 10:52 a.m., Dan Mitchell Wrote: Saletan thinks Reagan was wrong: "Liberty doesn't necessarily contract as government expands. Sometimes, you need more government to get
more liberty." Liberty is the wrong word, of course. Saletan is really talking about the difference between positive and negative rights. Reagan was a proponent of negative rights; most notably, Reagan
espoused the right to be left alone. In contrast, what Saletan calls liberty is really a set of positive rights -- a right to an education, a job, etc....
Contrary to Saletan's argument, positive rights cannot be achieved without limiting the liberty of individuals. During the Cold War, for example, totalitarian regimes justified their (egregiously bad) humans
rights records by stressing how they achieved positive rights the West left to the vagaries of the market place. Yet, they did so through totalitarian regimes characterized by central planning that proscribed
both freedom of contract and private property. ...Reagan's great legacy is that he restored protection of private property and freedom of
contract to the political debate as legitimate social goals. In doing so, he fortified the other freedoms William Saletan and the rest of us so often take for granted. We owe him our thanks.
Tuesday, June 8, 2004 ~ 9:22 a.m., Dan Mitchell Wrote: In 1981, when the nation's air-traffic controllers threatened to do what the law forbade them to do-strike-Reagan warned that if they did they
would be fired. When they struck in August, Reagan announced that the strikers would be terminated in two days. By firing the controllers, Reagan, the only union man-he had been head of the Screen Actors
Guild-ever to be president, destroyed a union, the Professional Air Traffic Controllers Organization (PATCO). ...In the post-PATCO climate of business operations, employers have been more inclined to
hire because they know that if the hiring proves to be improvident, those hired can be discharged. The propensity to hire has risen much more than the propensity to fire. In all of America's post-Civil War era
of industrialization, unemployment has never been as low for as long as it has generally been in the years since the extraordinary expansion that
began during Reagan's first term. ...Reagan always thought that winning the Cold War and revving up the American model of wealth creation were parts of the same project. That project was to convince the
watching world that the American social and political model-pluralism, the rule of law, allocation of wealth and opportunity mostly by markets and maximum diffusion of decision making-is unrivaled. To the extent
that anything in history can ever be said to be completed, that project has been. Tom Sowell, meanwhile, has a column that discusses Reagan's early decision to eliminate price controls on energy. Just as happened with the decision to fire the controllers, the left howled. But history, as usual, shows that Reagan was right: One of his first acts as President was to end price controls on petroleum. The New York Times condescendingly dismissed Reagan's
reliance on the free market and repeated widespread predictions of "declining domestic oil production" and skyrocketing gasoline prices.
Within four months the price of gasoline fell by more than 60 cents a gallon. More luck, apparently. ...Reagan was considered to be completely out of touch when he said that Communism was "another
sad, bizarre chapter in human history whose last pages even now are being written." But how many "smart" people saw the end of the Soviet
Union coming? Ronald Reagan left this country -- and the world -- a far better place than he found it. And he smiled while he did it. That's greatness...
Tuesday, June 8, 2004 ~ 8:55 a.m., Dan Mitchell Wrote: In 1983, I was confined to an eight-by-ten-foot prison cell on the border of Siberia. My Soviet jailers gave me the privilege of reading the latest
copy of Pravda. Splashed across the front page was a condemnation of President Ronald Reagan for having the temerity to call the Soviet
Union an "evil empire." Tapping on walls and talking through toilets, word of Reagan's "provocation" quickly spread throughout the prison.
We dissidents were ecstatic. Finally, the leader of the free world had spoken the truth - a truth that burned inside the heart of each and every
one of us. ...The legacy of president Reagan will surely endure. Armed with moral clarity, a deep faith in freedom, and the courage to follow his convictions, he was instrumental in helping the West win the Cold
War and hundreds of millions of people behind the Iron Curtain win their freedom.
Monday, June 7, 2004 ~ 5:00 p.m., Dan Mitchell Wrote: ...his heroes often were intellectuals, from the Founders straight through Milton Friedman and Hayek and Solzhenitsyn. But he did not
favor the intellectuals of his own day, because he thought they were in general thick-headed. He thought that many of the 20th century's intellectuals were high-IQ dimwits. He had an instinctive agreement
with Orwell's putdown that a particular idea was so stupid that only an intellectual would believe it. ...Ronald Reagan told the truth to a world
made weary by lies. He believed truth was the only platform on which a better future could be built. He shocked the world when he called the
Soviet Union "evil," because it was, and an "empire," because it was that, too. He never stopped bringing his message to the people of the
world, to Europe and China and in the end the Soviet Union. And when it was over, the Berlin Wall had been turned into a million concrete souvenirs, and Soviet communism had fallen. But of course it didn't fall.
It was pushed. By Mr. Know Nothing Cowboy Gunslinger Dimwit. All presidents should be so stupid. He pushed down income taxes too, from a high of 70% when he entered the White House to a new low of 28%
when he left, igniting the long boom that, for all its ups and downs, is with us still. He believed, as JFK did, that a rising tide lifts all boats. He
did much more, returning respect to our armed forces, changing 50-year-old assumptions about the place of government and the place of the citizen in the new America.
Monday, June 7, 2004 ~ 4:27 p.m., Dan Mitchell Wrote: Mr. Reagan was the most consequential President since FDR because of his ideas. His Presidency was at root about returning a country that was
heading toward decline back to its founding principles of individual liberty and responsibility. At the time it was called a "revolution" but
his era is better understood as a restoration. ...although he was our oldest President he saw further ahead than most others. It was Mr. Reagan himself, and not the CIA, who predicted the collapse of the
Soviet Union. As early as 1981, in his famous speech at Notre Dame, he called Communism "a sad, bizarre chapter in human history whose last
pages are even now being written." A year later he told the British House of Commons that "the march of freedom" and democracy "will
leave Marxism-Leninism on the ash heap of history." And in 1988, after Mikhail Gorbachev had conceded Soviet weakness by initiating perestroika, Mr. Reagan described for students at Moscow University
the link between the microchip and expanding human freedom. ...the Reagan tax cuts saved America from following Western Europe into welfare-state decline. In addition to igniting growth, his tax cuts put a
brake on the expansion of government that had seemed unstoppable. ...When Mr. Reagan took office, the top marginal U.S. tax rate was 70%. When he left the top rate was 28%; it is now 35%, and even John
Kerry has conceded with his proposal to cut some corporate taxes that the marginal rate of tax matters. Today Americans may disagree about what tax cuts are needed, how deep they should go, and what they
ought to target. But the debate itself reflects Mr. Reagan's central premise: that people respond to incentives, and that high taxes interfere with natural human creativity and drive.
Monday, June 7, 2004 ~ 2:31 p.m., Dan Mitchell Wrote: ...well before the end of Reagan's presidency in 1988, he had succeeded in reversing all of the problems he inherited, putting the U.S. economy
on the path of sound, noninflationary growth that continues to this day. To appreciate the magnitude of Reagan's achievement, it is important to
recall just how bad the economic situation was in 1980. There was a recession that year, beginning in January and ending in July. As a consequence, real growth for the year was negative, with the national
unemployment rate averaging more than 7 percent. Yet, inflation remained dangerously high. By December 1980, the consumer price index was 12.4 percent higher than a year earlier. ...The prime rate
went above 20 percent at mid-year and was still above 15 percent when Reagan took the oath of office. ...As impressive as Reagan's tangible accomplishments in office were, his less tangible accomplishments were
also significant. Together with Margaret Thatcher, he restored the idea that private individuals and businesses were the true sources of prosperity, not government. They gave legitimacy to free markets, open
trade and sound money, in contrast to socialism, planning and price controls, which had dominated economic policy throughout the world for more than half a century. The renaissance of growth and freedom in
Eastern Europe and the Third World owes much to Reagan's and Mrs. Thatcher's discrediting of the socialist idea and their tireless defense of economic freedom.
Monday, June 7, 2004 ~ 12:16 p.m., Dan Mitchell Wrote: Few Americans realize that President Reagan's economic policy won the Cold War by rejuvenating capitalism. Members of the Soviet Academy
of Sciences, with whom I spoke in Moscow during the Soviet Union's final months, agreed that it was President Reagan's confidence in capitalism, not his defense buildup, that caused Soviet leaders to lose
their confidence. ...Ronald Reagan took away the Soviets' comfort factor when he said that the "Phillips curve" and falling U.S. productivity were the results of the wrong policy mix, not inherent
features of a market economy. The U.S. economy, in other words, could be easily fixed, but the Soviet economy could not. Reagan then proved his point by slashing tax rates from 70 percent to 28 percent and
presiding over a record economic expansion while inflation fell. Margaret Thatcher achieved a similar renewal of the British economy... Reagan changed the world because he did not believe capitalism was a
spent force. He liberated our economy and chased away the "malaise" that had paralyzed the Carter administration and given hope to Soviet leaders.
Monday, June 7, 2004 ~ 9:50 a.m., Dan Mitchell Wrote: Ronald Reagan reinvigorated capitalism. It is hard, and for young people quite impossible, to remember how low the intellectual fortunes
of capitalism had fallen in the 1970's. But the truth is that aside from the right-wing fringe of the Republican Party and the University of Chicago Economics Department, it had almost no defenders left
anywhere. ...Prior to Reagan, there was no real sense even within the Republican Party that government regulation of the economy was a bad thing, and that if the free market were allowed to be free, things would
be better for everyone. ...By demonstrating, through deregulation, tax cuts, privatization and other initiatives, and most assuredly by the effective use of the bully pulpit that is the presidency, Ronald Reagan
fostered a revitalization of capitalism not only in the United States, but also throughout the world.
Monday, June 7, 2004 ~ 8:44 a.m., Dan Mitchell Wrote: Denis MacShane, the UK minister for Europe, has said that a referendum on the Constitution in the UK is unlikely before 2006.
...Furthermore, he believes that UK citizens will respond positively if the people were asked "Do you say Yes or No to Europe?" But polls show
that the British people are broadly in opposition to the Constitutional Treaty. ...Meanwhile, the President of the Convention that drafted the Constitutional Treaty has been dropping hints of his own, suggesting
that the Constitution should be ratified Europe-wide. Speaking at Europanova in front of a group of young Europeans, Valry Giscard d'Estaing said that what mattered "was not the number of countries
that have ratified it [the Constitution], but the number of European citizens".
Sunday, June 6, 2004 ~ 4:29 p.m., Dan Mitchell Wrote: With his declaration of "Government is not the solution, it's the problem," President Reagan took office in 1981 and immediately
pursued the underpinnings of his long-held conservative beliefs: lowering taxes, curtailing government regulation over the economy and attacking government waste and fraud. ...The result of his conservative
economic theory called "supply-side economics," a belief that tax cuts would stimulate the economy, has been an enduring success and
continues to be at the center of American politics today through the tax cuts that President Bush has enacted. "By every measure — the size of
the economy, stock averages — the period since 1981 till now has been one of unprecedented growth, with minor setbacks," said Donald P. Hodel, Mr. Reagan's energy secretary from 1981 to 1985 and his
interior secretary from 1985 to 1989. ..."He came to the presidency with vision for our country to advance the liberty and opportunities of the
people here and around the world by getting government off their backs and under control," said Becky Norton Dunlop, who was deputy assistant to the president for personnel in the Reagan White House.
Sunday, June 6, 2004 ~ 3:45 p.m., Dan Mitchell Wrote: ...if you seek Ronald Reagan's monument, look around, and consider what you do not see. The Iron Curtain that scarred a continent is gone,
as is the Evil Empire responsible for it. The feeling of foreboding -- the sense of shrunken possibilities -- that afflicted Americans 20 years ago
has been banished by a new birth of the American belief in perpetually expanding horizons. "Reagan bolstered the U.S. military might to ruin the Soviet economy, and he achieved his goal," said Gennady Gerasimov, who served as top
spokesman for the Soviet Foreign Ministry during the 1980s. ...Yelena Bonner, the widow of Soviet dissident Nobel Prize winner Andrei Sakharov, praised Reagan for his tough course toward the Soviet
Union. "I consider Ronald Reagan one of the greatest U.S. presidents since the World War II because of his staunch resistance to Communism and his efforts to defend human rights," Bonner said...
Sunday, June 6, 2004 ~ 1:13 a.m., Dan Mitchell Wrote: Seeking to jump-start spending, France said Thursday that it would encourage retailers to cut the price of brand-name products like
Coca-Cola and Danone yogurt, revamping pricing practices that have cost the French up to 13 percent more than what their closest European neighbors pay for such goods. Finance Minister Nicolas Sarkozy told a
meeting of retailers, suppliers and consumer groups that he sought an industrywide agreement to cut the cost of common brand-name goods by up to 5 percent. Should the sector fail to agree, he said, he could take
legislative steps to force down prices. … France's so-called Galland law, which bans retailers from selling merchandise at a loss, would remain in place, he said.
Sunday, June 6, 2004 ~ 12:34 a.m., Dan Mitchell Wrote: In New Jersey, it's last call on Ladies' Night. This week, director of the state division of civil rights, J. Frank Vespa-Papaleo, announced that
the Garden State will henceforth ban the longstanding practice of offering drink and admission discounts to women on designated ladies' nights. The 13-page ruling lectures that a bar's desire to attract
customers doesn't override the "important social policy objective of eradicating discrimination." In this case, "discrimination" refers to a
Cherry Hill restaurant's Wednesday-night practice of charging men a five dollar cover while letting women in free and offering them cheaper drinks. …New Jersey's Governor, Jim McGreevey, reportedly called the
ruling "bureaucratic nonsense," suggesting that ladies' night may be in line for a stay of execution by the executive branch. Nevertheless, the
ruling — however absurd — is emblematic of the growing arrogance of a government caste that seeks to micromanage every aspect of Americans' lives.
Saturday, June 5, 2004 ~ 9:00 a.m., Dan Mitchell Wrote: New Zealand's per capita income in the period prior to the late 1950s was right around number three in the world, behind the United States
and Canada. But by 1984, its per capita income had sunk to 27th in the world, alongside Portugal and Turkey. ...Government spending was a full 44 percent of GDP, investment capital was exiting in huge
quantities, and government controls and micromanagement were pervasive at every level of the economy. ...When a reform government was elected in 1984, it identified three problems: too much spending,
too much taxing and too much government. ...When we started this process with the Department of Transportation, it had 5,600 employees. When we finished, it had 53. When we started with the Forest Service, it
had 17,000 employees. When we finished, it had 17. When we applied it to the Ministry of Works, it had 28,000 employees. I used to be Minister of Works, and ended up being the only employee. ...We achieved an
overall reduction of 66 percent in the size of government, measured by the number of employees. The government's share of GDP dropped from 44 to 27 percent. ...We reduced income tax rates by half and
eliminated incidental taxes. As a result of these policies, revenue increased by 20 percent. Yes, Ronald Reagan was right: lower tax rates do produce more revenue.
Saturday, June 5, 2004 ~ 7:41 a.m., Dan Mitchell Wrote: "Where possible, we believe in low tax solutions to public policy issues – not high spending solutions," the Conservative leader Stephen Harper
told the Toronto Board of Trade on Wednesday. However, it became clear that the proposed tax cuts are to come at a price, as the Conservative leader outlined plans to cut government subsidies and
loans to Canadian corporations in order to pay for reductions in corporate and capital gains taxes. "We will only reduce corporate taxes to the extent that we can reduce corporate welfare. I call it the free
enterprise vs. the Canada Inc. approach," explained Mr Harper. …By contrast, the current Prime Minister and leader of the ruling Liberal Party, Paul Martin has pledged to increase spending on essential public
services, and has publicly stated that Canada can no longer afford to compete with the United States on the issue of taxation.
Friday, June 4, 2004 ~ 7:07 p.m., Dan Mitchell Wrote: French President Jacques Chirac has written to 60 world leaders and directors of the major multilateral financial institutions seeking support
for the creation of a global tax system to fund development projects in poor countries… he urged countries to seek greater coordination, particularly as concerns breaking down banking secrecy laws that
enable funds to be stashed away in offshore financial centers.
Friday, June 4, 2004 ~ 8:00 a.m., Dan Mitchell Wrote: European Union plans to introduce a new savings tax system on January 1 next year were in doubt on Wednesday because of the EU's
failure to agree a timetable with Switzerland over equivalent measures. EU finance ministers, meeting in Luxembourg, delayed a decision on launching the system to allow more time for negotiations with
Switzerland. … there are fears that any slippage in the timetable could delay the introduction of the system by up to a year until January 1, 2006, to coincide with the tax year start in most EU countries.
Jean-Claude Juncker, Luxembourg prime minister, argued that if there were a delay, it would be hard to implement the tax retroactively - implying that the measure might have to wait for a new tax year.
Luxembourg, Switzerland's financial rival, has always been unenthusiastic about the new regime. However, Dawn Primarolo, the UK's paymaster general, argued that a delay would increase the
chances that it might unnravel.
Friday, June 4, 2004 ~ 7:10 a.m., Dan Mitchell Wrote: Dutch sources, speaking to the EUobserver, confirmed that "the Dutch government agrees with the initiative of France and Germany [to set
minimum base rates for corporate tax]". …this apparent U-turn would cause delight in Paris and Berlin …The French, Germans and Swedes want to see a minimum base for corporate tax levels in the EU. …they
want to avoid a "race to the bottom" with Member States scrambling to reduce their rates in an effort to attract investment. …But many new
Member States see their low corporate tax rates as the best way of attracting investment and maintaining their generally high levels of economic growth. …And new Member States are joined in this by the
some "old" states, in particular the UK and Ireland. The latter country in particular has achieved a high level of economic growth in recent
times by keeping corporate tax rates down and heavily opposes any drive towards harmonisation.
Thursday, June 3, 2004 ~ 11:22 a.m., Dan Mitchell Wrote: It is widely recognized that millions of French, German, Belgian, and other EU citizens from member states with high income tax rates hide
money in bank accounts in Luxembourg and Switzerland. However, provided the EU cross-border savings tax does take effect in 2005, it remains to be seen if it will actually provide significant revenues to EU
member states. Within the Swiss, Luxembourg, and EU independent territory banking community, the EU savings tax is now referred to as
the "dummy tax" because there will be so many ways to avoid paying it. Even Bolkestein admitted that he "had the faintest idea of how much"
revenue the tax would generate in the EU and "that member states could very well be disappointed. "I am sure the fiscal tax lawyers in
Switzerland are working hard as we speak to come up with ways to get around the tax," Bolkestein said. "But we have to start somewhere. It
may be that, in several years time, we have to come back to the issue and make changes in order to correct any problems." The fact that the EU has failed to get Luxembourg, Switzerland, and the other
independent territories to give up bank secrecy drove Italian Finance Minister Giulio Tremonti to deride the legislation as "immoral and economically unjust."
Thursday, June 3, 2004 ~ 9:07 a.m., Dan Mitchell Wrote: It is becoming increasing likely that the implementation of the European Union's Savings Tax Directive will not go ahead as planned on January
1 2005. Comments made by the Austrian Finance Minster Karl-Heinz Grasser ahead of the EU Finance Minister's meeting yesterday appeared to confirm a growing resignation to the fact within the EU.
"The strong feeling that we have is that the January 1 implementation date will not be possible in Switzerland and Liechtenstein," he remarked. ...The main concern is that Swiss parliamentary procedure
and a possible referendum on the recent agreement with the EU to adopt the directive will take longer than is possible with the planned implementation date of next January. The EU also has to reach
acceptable agreements with other third countries, namely Andorra, Monaco, Liechtenstein and San Marino.
Thursday, June 3, 2004 ~ 8:45 a.m., Dan Mitchell Wrote: Taxes in the euro zone have been falling too, but rather modestly. From 2000 to 2002, the Euro zone's Tax Freedom Day fell from July 3 to June 28. "One reason for this might be the tax competition from Russia and the new EU accession countries, many of which have sought to revitalize their economics with low, flat-rate taxes," says Gabriel Stein, international economist with Lombard Street Research in London, who calculates Tax Freedom Day annually for the Adam Smith Institute. "Old Europe" has tried to resist this competition, talking about the need for "tax harmonization." But countries like Estonia and Slovakia are determined to keep themselves competitive and become the "tiger economies" of Europe. ...There can be no doubt that in a more globalized world economy, high-tax, high-spend governments will be squeezed. Of the EU countries, Ireland seems the best placed, with its relatively light regulation and an early Tax Freedom Day (May 7). ...But the highest-taxed country in the EU -- indeed, in the whole of the OECD -- is Sweden, with a Tax Freedom Day of July 29. Indeed, it has collected this booby prize for years, but there are signs that this high-tax, high-regulation economy too might be cracking. The Prime Minister, Goeran Persson, visited Bratislava a couple of weeks ago and was visibly impressed by Slovakia's economic progress, built on its 19% flat-rate tax. He could do well to spread that message around his colleagues in Stockholm. http://online.wsj.com/article/0,,SB108621261234427278,00.html?mod=opin ion (subscription required)
Thursday, June 3, 2004 ~ 6:30 a.m., Dan Mitchell Wrote: EU finance ministers hoped to give their final blessing to the savings tax directive Wednesday, so that it could take effect on Jan. 1 in the 25
EU countries, but they could not reach an agreement. The directive was contingent on a group of non-EU countries, money magnets all, joining in. ...Luxembourg banks have already begun advising their clients on
the many loopholes for avoiding the new tax, which is to start at 15 percent and climb to 35 percent by 2010. Since it applies only to interest
on savings, people can diversify their holdings into mutual funds or bonds, which can exempt them from the tax, notes Lucien Thiel, general manager of the Luxembourg banking association, ABBL. They can also
set up a trust since the tax only applies to "physical persons." ."Today you don't need to be really rich and wealthy man to set up such a
structure," Thiel said in an interview. "What is bad if you try to avoid taxation?" he asked. "This might be considered as being a crime by
some countries but for me it's also an act of self-defense by the customers."
Wednesday, June 2, 2004 ~ 3:15 p.m., Dan Mitchell Wrote: European Commission officials fear a new scheme to crack down on tax dodgers will fail to win final backing this week because of continuing
problems with Switzerland, despite a recent, apparently successful summit between the two sides. European Union finance ministers are scheduled to vote on Wednesday on whether to implement a new
savings tax system next January. But it is growing more likely that the final decision will have to be made later in June and the new system be
delayed. At the heart of the issue is continuing distrust between the EU and Switzerland over timetables and the "bundling" of agreements, as
well as uncertainty over whether other countries will meet the EU's demands. ...EU officials are upset that Switzerland is still "bundling"
the savings tax with both the Schengen deal and a separate agreement on processed agriculture products such as chocolate and spaghetti. Because details of the other two deals have yet to be finalised, this could
hold up progress on all three. ...Last week the Commission also told member states that it had yet to make a breakthrough with Liechtenstein, one of the other third countries involved, and an offer
from San Marino was good but not perfect.
Wednesday, June 2, 2004 ~ 2:41 p.m., Dan Mitchell Wrote: What European business needs in the long term is "political union" in the EU, according to the head of Eurochambres - an association
representing over 17 million businesses in Europe. Austrian Christoph Leitl told the EUobserver in an interview, "a free-trade zone is good for
business but business in the long run needs political union. You can't have a stable currency without a political power behind it. And
therefore we need it". "If Britain wants to stop the train, then we should let them get out at the next station and take the slow train", he added.
Like most business leaders, Mr Leitl bemoans the current slow rate of growth in the EU but pleads for European solutions to European problems - rather than a return to national interests, as he puts it. ...But
nothing can help the EU in its main economic goal, which is to become "the most competitive, knowledge-based economy in the world by
2010" - the so-called Lisbon goals. "We have to say that Europe has failed to close the gap between the US and to become the most
competitive area in the world by 2010 is no longer possible", he said.
Wednesday, June 2, 2004 ~ 11:35 a.m., Dan Mitchell Wrote: An absolute majority of the people who were in the bottom 20 percent in income in 1975 have since then also been in the top 20 percent. This
inconvenient fact has been out there for years -- and has been ignored for years by those who want more government programs to relieve individuals from responsibility for making themselves more productive
and therefore higher income earners. ...Some people, of course, never learn -- and never rise. Creating entitlements for them reduces any need to learn. But that is the way BusinessWeek urges us to go. They want
higher minimum wages imposed, despite evidence that minimum wage laws reduce employment. ...BusinessWeek wants "better day-care
options" -- "especially for single moms." In other words, unmarried girls should have babies and expect the taxpayers to pick up the tab for taking care of them.
Wednesday, June 2, 2004 ~ 4:10 a.m., Dan Mitchell Wrote: In a letter to the EC dated May 26, German Finance Minister, Hans Eichel and his French counterpart, Nicolas Sarkozy explained that:
"The German and French governments believe it is urgent to strengthen at European level a fair framework for competition for our companies within the internal market. We are therefore proposing that the
Commission make a concrete proposal as soon as possible for a single corporate tax base, that if possible also includes a minimum tax rate." ...EC spokesman Jonathon Todd announced that: "The European
Commission is in favour of harmonisation of the corporate tax base to increase transparency and lighten the administrative burden on companies doing business in more than one country. However, the
Commission is not in favour of harmonisation of tax rates."
Tuesday, June 1, 2004 ~ 8:55 a.m., Dan Mitchell Wrote: The former communist countries have greatly reduced tax rates to make themselves internationally competitive. As a result, they have been
growing much faster than most E.U. countries — that is, they have been catching up, which is precisely the goal. The French and Germans, rather than applauding this, are now trying to stop it. German
Chancellor Gerhard Schroeder recently demanded the new entrants agree to minimum taxes (i.e., the weight belt). The Germans and French
claim they are seeking "tax harmonization" rather than "destructive tax competition." Of course, in the real world tax competition is highly
desirable, because it forces governments to operate more efficiently and protects both the pocketbooks and the liberties of taxpayers. The argument against tax competition is identical to that made when the
inefficient, pricey retail store demands the new discount store raise its prices "to be fair."
Tuesday, June 1, 2004 ~ 7:03 a.m., Dan Mitchell Wrote: Fifty years after Brown v. Board of Education struck down the doctrine of "separate but equal," genuine equality of education remains a distant
dream. The state of public schooling in general these days is nothing to boast about, but for black and Hispanic kids in particular, it is shocking.
Disparities in education have become so pronounced, as the scholars Abigail and Stephan Thernstrom have shown, that the average black high school senior today is less competent in reading, math, and history
than the average white 8th-grader. ...Not all of this is the fault of the schools. As the Thernstroms stress, culture is critical: Students who do well academically are more likely to come from homes where
expectations are high, the work ethic is strong, and the TV is turned off. ...Education policy in the United States treats Americans as too incompetent to provide for their children's schooling. Unlike food or
clothing or health care -- where the market generates lots of options and parents are free to choose among them -- education is mostly
supplied on the Soviet model: Schooling is "free," but the schools are owned and operated by the state. A small fraction of parents pay to
educate their children privately, but the great majority simply take what the state supplies. ...The public education system is essentially a monopoly, and like most monopolies, it wastes money, performs
indifferently, and doesn't much care if its customers -- American mothers and fathers -- are satisfied. But give those mothers and fathers
the same freedom of choice when it comes to their kids' education that they have when it comes to their kids' shoes or dinner, and all of that would change.
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