President Barack Obama narrowly defeated Gov. Mitt Romney in the popular vote 51 percent to 48 percent. In the all-important Electoral College, the difference was larger, with Obama winning 303 electoral votes and Romney 206. Let's not think so much about the election's outcome but instead ask: What's so good about democracy and majority rule?
How many decisions in our day-to-day lives would we like to be made through majority rule or the democratic process? How about the decision to watch a football game or "Law and Order"? What about whether to purchase a Chevrolet Volt or a Toyota Prius? Would you like the decision of whether to have turkey or ham for Thanksgiving dinner to be made through the democratic process? Were such decisions made in the political arena, most of us would deem it tyranny.
Here's a which-is-better question for you. Suppose a New Jersey motel room rented for $125 a night prior to Hurricane Sandy's devastation. When the hurricane hits, a husband, wife and their two youngsters might seek the comfort of renting two adjoining rooms. However, when they arrive at the motel, they find that rooms now rent for $250. At that price, they might decide to make do with one room. In my book, that would be wonderful. That decision would make a room available for another family who had to evacuate Sandy's wrath. New Jersey Gov. Chris Christie and others condemn this as price gouging, but I ask you: Which is preferable for a family seeking shelter — a room available at $250 or a room unavailable at the pre-hurricane price of $125?
It's not the intention of the motel owner to make a room available for another family. He just sees an opportunity to earn more money. It was not the intention of the family of four who made do with just one room to make a room available for another evacuating family. They are just trying to save money. Even though it was no one's intention to make that room available, the room was made available as if intended. That's the unappreciated benefit of freely fluctuating prices. They get people to do voluntarily what's in the social interest — conserve on goods and services that have become scarce.
Here's one usage of the term gentleman: The gentleman helped the fallen lady to her feet. Here's another, one we might hear from a newscaster or a police spokesman: Tonight we report on the arrest of two gentlemen who raped, sodomized and murdered an 80-year-old woman.
During earlier times, to be called a gentleman meant one was honest, brave, courteous and loyal. Today "gentleman" is used interchangeably in reference to decent people and the scum of the earth.
Dr. Thomas Sowell's "'Trickle Down Theory' and 'Tax Cuts for the Rich'" has just been published by the Hoover Institution. Having read this short paper, the conclusion you must reach is that the term "trickle down theory" is simply a tool of charlatans and political hustlers.
Sowell states that "no such theory has been found in even the most voluminous and learned histories of economic theories." That's from a scholar who has published extensively in the history of economic thought. Several years ago, Sowell, in his syndicated column, challenged anyone to name an economist from any economic school of thought who had actually advocated a "trickle down" theory. To date, no one has quoted any economist who ever advocated such a theory. Trickle down is a nonexistent theory. Those who use it simply argue against a caricature rather than confront an argument actually made.
Here's a question: If there's a disaster, a war, a severe drought or some other calamity that restricts future supplies of a commodity — such as oil, coffee or corn — what is the intelligent thing for people to do right away? If you said "use less now and try to produce more," you'd be absolutely correct. That's not rocket science, but understanding the machinery involved in getting people to do so is a bit more challenging.
The best way to get people to use less and produce more is to allow prices to rise. For example, say a Middle East conflict restricts oil supplies and causes prices to rise. The effect of higher prices for oil is that it gives individuals incentive to eliminate or reduce the low-valued uses of oil. For example, a low-valued use of oil is for homeowners to allow the heat that it generates to seep through walls and leaky windows. Higher oil prices create incentives to homeowners to install insulation. Higher gasoline prices force motorists to economize by taking measures such as carpooling and taking fewer low-valued trips.
Within the past decade, I've written columns titled "Deception 101," "Stubborn Ignorance" and "Exploiting Public Ignorance," all explaining which branch of the federal government has taxing and spending authority. So here it is again: The first clause of Article 1, Section 7 of the U.S. Constitution, generally known as the "origination clause," reads: "All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills." Constitutionally and by precedent, the House of Representatives has the exclusive prerogative to originate bills to appropriate money, as well as to raise revenues. The president is constitutionally permitted to propose tax and spending measures or veto them. Congress has the authority to ignore the president's proposals and override his vetoes.
There is little intellectually challenging about the fact that the Constitution gave Congress ultimate taxing and spending authority. My question is this: How can academics, politicians, news media people and ordinary citizens continually make and get away with statements such as "Reagan's budget deficits," "Clinton's budget surplus," "Bush's tax cuts" and "Obama's spending binge"? I know that the nation's law schools teach little about Framer intent, but I wonder whether they tell students that it's the executive branch of government that holds taxing and spending authority. Maybe it's simply incurable ignorance, willful deception, sloppy thinking or just plain stupidity. If there's an explanation that I've missed, I'd surely like to hear it.
Let's pretend that we have the political guts to expand economic opportunities for people at the lower end of the economic spectrum. What vested interests should be attacked, and what economic regulations should be targeted for elimination?
It doesn't take a lot of money to become a taxi owner-operator and earn more than $40,000 a year. One needs a car, an insurance policy and ancillary interior equipment to make a car a taxi. In New York City, to be a taxi owner you'd have to purchase a license -- called a medallion -- that in June 2012 cost $704,000. New York's Taxi and Limousine Commission restrictions that generate such a license price outlaw taxi ownership by people who don't have access to a $704,000 loan. By contrast, in Washington, D.C., the annual fee for a license to own a taxi is $125. I'll let you guess which city has more taxis per capita, cheaper fares and more black taxi ownership.
If you listen to America's political hacks, mainstream media talking heads and their socialist allies, you can't help but reach the conclusion that the nation's tax burden is borne by the poor and middleclass while the rich get off scot-free.
Stephen Moore, senior economics writer for The Wall Street Journal, and I'm proud to say former GMU economics student, wrote "The U.S. Tax System: Who Really Pays?" in the Manhattan Institute's Issue 2012 (8/12). Let's see whether the rich are paying their "fair" share.
President Barack Obama recently wrote an executive order that established a White House initiative on educational excellence for black Americans that will be housed in the Department of Education. It proposes "to identify evidence-based best practices" to improve black achievement in school and college. Though black education is in desperate straits, the president's executive order will accomplish absolutely nothing to improve black education. The reason is that it does not address the root causes of educational rot among black Americans. It's not rocket science; let's look at it.
The president's initiative contains not one word about rampant inner-city school violence, which makes educational excellence impossible. During the past five years, Philadelphia's 268 schools had 30,000 serious criminal incidents, including assaults — 4,000 of which were on teachers — robberies and rapes. Prior to recent layoffs, Philadelphia's school district employed about 500 police officers. In Chicago last year, 700 young people were gunfire victims, and dozens of them lost their lives. Similar stories of street and school violence can be told in other large, predominantly black cities, such as Baltimore, Detroit, Cleveland, Oakland and Newark.
The agendas of liberals, progressives and assorted tyrants desperately depend on the aspects of human nature they often condemn, such as acquisitiveness, profit motive, self-interestedness and greed. This crossed my mind while reading "How Departures From Economic Freedom Can Affect Freedom In General," by Dr. John Taylor, a Hoover Institution scholar. Taylor tells how former Wells Fargo CEO Dick Kovacevich was forced to take Troubled Asset Relief Program funds even though Wells Fargo did not need or want the funds. Kovacevich was threatened that if he did not accept TARP money, regulators would declare his bank capital-deficient even though Wells Fargo had a triple-A rating. At the time, October 2008, Wells Fargo was in the process of acquiring Wachovia, and to be declared capital-deficient would have killed the deal. U.S. Treasury Secretary Hank Paulson and Fed Chairman Ben Bernanke could rely on acquisitiveness, profit motive and self-interestedness to bully Wells Fargo into accepting TARP money. They also knew that Wells Fargo's competitors would go after Wachovia. If all sound banks had refused TARP money, Paulson and Bernanke's tyrannical threats would have failed.
One of the more difficult lessons to teach economics neophytes — and, many times, trained economists — is that economic theory cannot say anything definitive about subjective statements, such as what's better, good, bad or worse. Let's try a few examples to make the point.
Cabernet sauvignon wine is better than fume blanc. Turkey is better than pork. Matter in the solid state is better than the plasma state. Each of those statements begs the question: Where's the proof? With subjective statements such as those, disagreements can go on forever. It's simply a matter of personal opinion. One person's opinion of what's better or worse is just as good as another's.
Back in 2009, U.S. Attorney General Eric Holder said we were "a nation of cowards" on matters of race. Permit me to be brave and run a few assertions by you just to see whether we're on the same page. There should be two standards for civilized conduct: one for whites, which is higher, and another for blacks, which is lower. In other words, in the name of justice and fair play, blacks should not be held accountable to the same standards that whites are and should not be criticized for conduct that we'd deem disgusting and racist if said or done by whites.
You say, "Williams, what in the world are you talking about?" Mitt Romney hasn't revealed all of his fall campaign strategy yet, but what if he launched a "White Americans for Romney" movement in an effort to get out the white vote? If the Romney campaign did that, there'd be a media-led outcry across the land, with charges ranging from racial insensitivity to outright racism. When President Barack Obama announced his 2012 launch of "African Americans for Obama" (http://www.youtube.com/watch?v=BdjoHA5ocwU), the silence was deafening. Should the same standards be applied to Obama as would be applied to Romney? The answer turns out to be no, because Obama is not held to the same standards as Romney.
Some of the responses to my column last week, titled "Immoral Beyond Redemption," prove that Americans have been hoodwinked by Congress. Some readers protested my counting Social Security among government handout programs that can be described as Congress' taking what belongs to one American and giving to another, to whom it doesn't belong — legalized theft. They argued that they worked for 45 years and paid into Social Security and that the money they now receive is theirs. These people have been duped and shouldn't be held totally accountable for such a belief. Let's look at it.
The Social Security pamphlet of 1936 read, "Beginning November 24, 1936, the United States Government will set up a Social Security account for you. ... The checks will come to you as a right." (http://www.ssa.gov/history/ssb36.html). Americans were led to believe that Social Security was like a retirement account and that money placed in it was, in fact, their property. Shortly after the Social Security Act's passage, it was challenged in the U.S. Supreme Court, in Helvering v. Davis (1937). The court held that Social Security was not an insurance program, saying, "The proceeds of both employee and employer taxes are to be paid into the Treasury like any other internal revenue generally, and are not earmarked in any way." In a 1960 case, Flemming v. Nestor, the Supreme Court said, "To engraft upon Social Security system a concept of 'accrued property rights' would deprive it of the flexibility and boldness in adjustment to ever-changing conditions which it demands."
Benjamin Franklin, statesman and signer of our Declaration of Independence, said: "Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." John Adams, another signer, echoed a similar statement: "Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other." Are today's Americans virtuous and moral, or have we become corrupt and vicious? Let's think it through with a few questions.
Suppose I saw an elderly woman painfully huddled on a heating grate in the dead of winter. She's hungry and in need of shelter and medical attention. To help the woman, I walk up to you using intimidation and threats and demand that you give me $200. Having taken your money, I then purchase food, shelter and medical assistance for the woman. Would I be guilty of a crime? A moral person would answer in the affirmative. I've committed theft by taking the property of one person to give to another.
Our nation is rapidly approaching a point from which there's little chance to avoid a financial collapse. The heart of our problem can be seen as a tragedy of the commons. That's a set of circumstances when something is commonly owned and individuals acting rationally in their own self-interest produce a set of results that's inimical to everyone's long-term interest. Let's look at an example of the tragedy of the commons phenomenon and then apply it to our national problem.
Imagine there are 100 cattlemen all having an equal right to graze their herds on 1,000 acres of commonly owned grassland. The rational self-interested response of each cattleman is to have the largest herd that he can afford. Each cattleman pursing similar self-interests will produce results not in any of the cattlemen's long-term interest — overgrazing, soil erosion and destruction of the land's usefulness. Even if they all recognize the dangers, does it pay for any one cattleman to cut the size of his herd? The short answer is no because he would bear the cost of having a smaller herd while the other cattlemen gain at his expense. In the long term, they all lose because the land will be overgrazed and made useless.
Each year, roughly 7,000 blacks are murdered. Ninety-four percent of the time, the murderer is another black person. According to the Bureau of Justice Statistics, between 1976 and 2011, there were 279,384 black murder victims. Using the 94 percent figure means that 262,621 were murdered by other blacks. Though blacks are 13 percent of the nation's population, they account for more than 50 percent of homicide victims. Nationally, black homicide victimization rate is six times that of whites, and in some cities, it's 22 times that of whites. Coupled with being most of the nation's homicide victims, blacks are most of the victims of violent personal crimes, such as assault and robbery.
The magnitude of this tragic mayhem can be viewed in another light. According to a Tuskegee Institute study, between the years 1882 and 1968, 3,446 blacks were lynched at the hands of whites. Black fatalities during the Korean War (3,075), Vietnam War (7,243) and all wars since 1980 (8,197) come to 18,515, a number that pales in comparison with black loss of life at home. It's a tragic commentary to be able to say that young black males have a greater chance of reaching maturity on the battlefields of Iraq and Afghanistan than on the streets of Philadelphia, Chicago, Detroit, Oakland, Newark and other cities.
Let's think about whether all acts of Congress deserve our respect and obedience. Suppose Congress enacted a law — and the Supreme Court ruled it constitutional — requiring American families to attend church services at least three times a month. Should we obey such a law? Suppose Congress, acting under the Constitution's commerce clause, enacted a law requiring motorists to get eight hours of sleep before driving on interstate highways. Its justification might be that drowsy motorists risk highway accidents and accidents affect interstate commerce. Suppose you were a jury member during the 1850s and a free person were on trial for assisting a runaway slave, in clear violation of the Fugitive Slave Act. Would you vote to convict and punish?
A moral person would find each one of those laws either morally repugnant or to be a clear violation of our Constitution. You say, "Williams, you're wrong this time. In 1859, in Ableman v. Booth, the U.S. Supreme Court ruled the Fugitive Slave Act of 1850 constitutional." That court decision, as well as some others in our past, makes my case. Moral people can't rely solely on the courts to establish what's right or wrong. Slavery is immoral; therefore, any laws that support slavery are also immoral. In the words of Thomas Jefferson, "to consider the judges as the ultimate arbiters of all constitutional questions (is) a very dangerous doctrine indeed, and one which would place us under the despotism of an oligarchy."
The Washington, D.C.-based Tax Foundation does a yeoman's job of keeping track of how much we're paying in taxes and who's paying what. It turns out that American taxpayers worked this year from Jan. 1 to April 17, 107 days, to earn enough money to pay their federal, state and local tax bills. That statistic requires some clarification, and I ask my readers to help me examine it.
According to the Congressional Budget Office, Congress will spend $3.8 trillion this year, about 24 percent of our $15 trillion gross domestic product. But federal tax revenue will be much less, only $2.5 trillion, or 16 percent of the GDP. That means there's a shortfall of $1.3 trillion. Some people, including economists, say there's a deficit. That's true, but only in an accounting sense, not in any meaningful economic sense. Let's look at it.
It's difficult to be a good economist and simultaneously be perceived as compassionate. To be a good economist, one has to deal with reality. To appear compassionate, often one has to avoid unpleasant questions, use "caring" terminology and view reality as optional.
Affordable housing and health care costs are terms with considerable emotional appeal that politicians exploit but have absolutely no useful meaning or analytical worth. For example, can anyone tell me in actual dollars and cents the price of an affordable car, house or myomectomy? It's probably more pleasant to pretend that there is universal agreement about what is or is not affordable.
When NBC's "Today" show played the audio of George Zimmerman's call to a Sanford, Fla., police dispatcher about Trayvon Martin, the editors made him appear to be a racist who says: "This guy looks like he's up to no good. He looks black." What Zimmerman actually said was: "This guy looks like he's up to no good or he's on drugs or something. It's raining, and he's just walking around, looking about." The 911 officer responded by asking, "OK, and this guy — is he black, white or Hispanic?" Zimmerman replied, "He looks black." NBC says it's investigating the doctoring of the audio, but there's nothing to investigate; its objective was to inflame passions.
In his Associated Press article titled "Old photos may be deceptive in Fla. shooting case," Matt Sedensky pointed out that the photos carried by the major media were several years old and showed Zimmerman looking fat and mean and Martin looking like a sweet young kid.
Right now, there isn't enough known about the circumstances surrounding the fatal shooting of 17-year-old Trayvon Martin, a black, by George Zimmerman, a 28-year-old part-Hispanic, during his neighborhood watch tour in an Orlando, Fla., suburb. If evidence emerges that Zimmerman's actions were not justified, he should be prosecuted and punished; however, there's a larger issue that few people understand or have the courage to acknowledge, namely that black and young has become synonymous with crime and, hence, suspicion. To make that connection does not make one a racist. Let's look at it.
Twelve years ago, a black Washington, D.C., commissioner warned cabbies, most of whom were black, against picking up dangerous-looking passengers. She described "dangerous-looking" as a "young black guy ... with shirttail hanging down longer than his coat, baggy pants, unlaced tennis shoes." She also warned cabbies to stay away from low-income black neighborhoods. Did that make the D.C. commissioner a racist?
Last month, at a Raeford, N.C., elementary school, a teacher confiscated the lunch of a 5-year-old girl because it didn't meet U.S. Department of Agriculture guidelines and therefore was deemed nonnutritious. She replaced it with school cafeteria chicken nuggets. The girl's home-prepared lunch was nutritious; it consisted of a turkey and cheese sandwich, potato chips, a banana and apple juice. But whether her lunch was nutritious or not is not the issue. The issue is governmental usurpation of parental authority.
In a number of states, pregnant teenage girls may be given abortions without the notification or the permission of parents. The issue is neither abortion nor whether a pregnant teenager should have an abortion. The issue is this: What gives the government the authority to usurp parental authority?
If one manages to graduate from high school without the rudiments of algebra, geometry and trigonometry, there are certain relatively high-paying careers probably off-limits for life — such as careers in architecture, chemistry, computer programming, engineering, medicine and certain technical fields. For example, one might meet all of the physical requirements to be a fighter pilot, but he's grounded if he doesn't have enough math to understand physics, aerodynamics and navigation. Mathematical ability helps provide the disciplined structure that helps people to think, speak and write more clearly. In general, mathematics is an excellent foundation and prerequisite for study in all areas of science and engineering. So where do U.S. youngsters stand in math?
Drs. Eric Hanushek and Paul Peterson, senior fellows at the Hoover Institution, looked at the performance of our youngsters compared with their counterparts in other nations, in their Newsweek article, "Why Can't American Students Compete?" (Aug. 28, 2011), reprinted under the title "Math Matters" in the Hoover Digest (2012). In the latest international tests administered by the Organisation for Economic Co-operation and Development, only 32 percent of U.S. students ranked proficient in math — coming in between Portugal and Italy but far behind South Korea, Finland, Canada and the Netherlands. U.S. students couldn't hold a finger to the 75 percent of Shanghai students who tested proficient.
Let's think about the kind of mess that we're in. Federal 2010 Medicare and Medicaid expenditures totaled $800 billion. The projected annual growth of both programs is about 7 percent. Social Security expenditures are more than $700 billion a year. According to the 2009 Social Security and Medicare trustees reports, by 2030, 49 percent of federal revenues will go for Social Security and Medicare payments. The unfunded liability of both programs is already $106 trillion.
But not to worry. The Congressional Budget Office estimates that it's possible to sustain today's level of federal spending and even achieve a balanced budget. All that Congress would have to do is raise the lowest income tax bracket of 10 percent to 25 percent and the middle tax bracket of 25 percent to 66 percent and raise the 35 percent tax bracket to 92 percent. That's a static vision that assumes that people will have no response and they'll work just as hard and send more money to Washington. If Congress did legislate such tax increases, it would be the economic equivalent of committing national hara-kiri.
There's been a heap of criticism placed upon President Barack Obama's domestic policies that have promoted government intrusion and prolonged our fiscal crisis and his foreign policies that have emboldened our enemies. Any criticism of Obama pales in comparison with what might be said about the American people who voted him in to the nation's highest office.
Obama's presidency represents the first time in our history that a person could have been elected to that office who had long-standing close associations with people who hate our nation. I'm speaking of the Rev. Jeremiah Wright, Obama's pastor for 20 years, who preached that blacks should sing not "God Bless America," but "God damn America." Then there's William Ayers, now professor of education at the University of Illinois at Chicago but formerly a member of the Weather Underground, an anti-U.S. group that bombed the Pentagon, U.S. Capitol and other government buildings. Although Ayers was never convicted of any crime, he told a New York Times reporter, in the wake of the September 2001 terrorist attack, "I don't regret setting bombs. ... I feel we didn't do enough." Obama has served on a foundation board, appeared on panels, and even held campaign events in Ayers' home, joined by Ayers' former-fugitive wife, Bernardine Dohrn. Bill Ayers' close association with Obama is reflected by his admission that he helped write Obama's memoirs, "Dreams from My Father."
Larry Sand's article "No Wonder Johnny (Still) Can't Read" — written for The John William Pope Center for Higher Education Policy, based in Raleigh, N.C. — blames schools of education for the decline in America's education. Education professors drum into students that they should not "drill and kill" or be the "sage on the stage" but instead be the "guide on the side" who "facilitates student discovery." This kind of harebrained thinking, coupled with multicultural nonsense, explains today's education. During his teacher education, Sand says, "teachers-to-be were forced to learn about this ethnic group, that impoverished group, this sexually anomalous group, that under-represented group, etc. — all under the rubric of 'Culturally Responsive Education.'"
Last week's column started off asking: "What human motivation gets the most wonderful things done?" The answer is that human greed is what gets wonderful things done. I wasn't talking about fraud, theft, dishonesty, special privileges from government or other forms of despicable behavior. I was talking about people trying to get as much as they can for themselves.
Think about greed and racial discrimination. In 1947, when the Brooklyn Dodgers hired Jackie Robinson, why did racial discrimination by major league teams begin to drop like a hot potato? It wasn't feelings of guilt by white owners, affirmative action or anti-discrimination laws. It turned out that there was a huge pool of black baseball talent in the Negro leagues. It became too costly for teams to allow the Dodgers to gain a monopoly on this talent. Black players won the National League's Most Valuable Player award for seven consecutive seasons. Had other teams not stepped in to hire black players, allowing the Dodgers to hire them, it might have given the Dodgers a virtual monopoly on world championships.
What human motivation gets the most wonderful things done? It's really a silly question, because the answer is so simple. It turns out that it's human greed that gets the most wonderful things done. When I say greed, I am not talking about fraud, theft, dishonesty, lobbying for special privileges from government or other forms of despicable behavior. I'm talking about people trying to get as much as they can for themselves. Let's look at it.
This winter, Texas ranchers may have to fight the cold of night, perhaps blizzards, to run down, feed and care for stray cattle. They make the personal sacrifice of caring for their animals to ensure that New Yorkers can enjoy beef. Last summer, Idaho potato farmers toiled in blazing sun, in dust and dirt, and maybe being bitten by insects to ensure that New Yorkers had potatoes to go with their beef.
Nobel Prize-winning economist Paul Krugman, in his New York Times column titled "Free to Die" (9/15/2011), pointed out that back in 1980, his late fellow Nobel laureate Milton Friedman lent his voice to the nation's shift to the political right in his famous 10-part TV series, "Free To Choose." Nowadays, Krugman says, "'free to choose' has become 'free to die.'" He was referring to a GOP presidential debate in which Rep. Ron Paul was asked what should be done if a 30-year-old man who chose not to purchase health insurance found himself in need of six months of intensive care. Paul correctly, but politically incorrectly, replied, "That's what freedom is all about — taking your own risks." CNN moderator Wolf Blitzer pressed his question further, asking whether "society should just let him die." The crowd erupted with cheers and shouts of "Yeah!", which led Krugman to conclude that "American politics is fundamentally about different moral visions." Professor Krugman is absolutely right; our nation is faced with a conflict of moral visions. Let's look at it.
Benefiting from a hint from an article titled "Is Harry Potter Making You Poorer?", written by my colleague Dr. John Goodman, president of the Dallas-based National Center for Policy Analysis, I've come up with an explanation and a way to end income inequality in America, possibly around the world. Joanne Rowling was a welfare mother in Edinburgh, Scotland. All that has changed. As the writer of the "Harry Potter" novels, having a net worth of $1 billion, she is the world's wealthiest author. More importantly, she's one of those dastardly 1-percenters condemned by the Occupy Wall Streeters and other leftists.