Commentary Magazine


Topic: Cato Institute

Media Bias, Liberal Cluelessness

Ross Douthat writes:

A month ago, a U.C.L.A. graduate student named Emily Ekins spent hours roaming a Tea Party rally on the Washington Mall, photographing every sign she saw.

Ekins, a former CATO Institute intern, was examining the liberal conceit that Tea Party marches are rife with racism and conspiracy theorizing. Last week, The Washington Post reported on her findings: just 5 percent of the 250 signs referenced Barack Obama’s race or religion, and 1 percent brought up his birth certificate. The majority focused on bailouts, deficits and spending — exactly the issues the Tea Partiers claim inspired their movement in the first place.

On one level, as Douthat points out, this is a lesson about desperate liberals making up comforting myths. (“The Democrats are weeks away from a midterm thumping that wasn’t supposed to happen, and the liberal mind is desperate for a narrative, a storyline, something to ease the pain of losing to a ragtag band of right-wing populists.”) But it is also a cautionary tale about the willful ineptitude and outright laziness of the mainstream media.

A single intern did what not a single mainstream outlet, with collectively thousands of cameramen and reporters, refused to do: get the facts. The mainstream media eagerly recited false accounts of racial epithets but could not be bothered to do a systematic report on the Tea Partiers’ actual message.

The media and elected liberals reinforce their own contrived narrative. Liberal leaders proclaim that the Tea Partiers are racists. The media dutifully report the accusations and search out the isolated Obama = Hitler signs. The liberals breathe a sigh of relief as they read the New York Times or watch MSNBC, which confirms that, yes, these people are wackos and racists. The cycle repeats. The only thing missing are facts.

While the mainstream media’s bias rankles conservatives, the latter should be pleased that the willful indifference to reality repeatedly deprives liberal officialdom of warning signals and essential feedback on the public reaction to their agenda. It is maddening for conservatives, but it is dangerous for liberals to operate in a world of fabrication.

Partners in the Conservative Revival

Both Bill Kristol and Peter Berkowitz have taken up the issue of conservative reform and the respective tasks of wonkish conservative innovators and the grassroots Tea Party movement. The mainstream media like to portray the two groups — the reformers and the Tea Partiers – in opposition in a party civil war (as if Rep. Paul Ryan and Sarah Palin were in competition for the soul of the GOP). But as Kristol and Berkowitz explain, the two aspects of the revived conservative movement are compatible, and each is essential in its own realm.

Kristol reminds us that the Tea Party movement has helped to unnerve and beat back the liberal statists, but that is the beginning and not the end of a conservative resurgence:

We already have a Middle American populist reaction against the government schemes of pointy-headed intellectuals. Barack Obama got the highest percentage of the votes of any Democratic presidential candidate since Lyndon Johnson in 1964; Republicans look to be on track this year to replicate their 47-seat House pick-up in 1966.

What comes next? That’s up to us—especially to us conservatives. We’re not doomed to repeat the pretty miserable political, social, and economic performance of 1967-80. …

Can conservatives develop a program, an agenda, and a governing vision that would, in the words of Federalist 39, vindicate “that honorable determination which animates every votary of freedom, to rest all our political experiments on the capacity of mankind for self-government”?

And Berkowitz provides a helpful review of the history of conservative reform, pointing toward those whose task it will be to provide an alternative to Obamaism:

New Jersey Gov. Chris Christie, Indiana Gov. Mitch Daniels, Louisiana Gov. Bobby Jindal, Mississippi Gov. Haley Barbour and Wisconsin Rep. Paul Ryan are among those officeholders in the process of recovering reform as a conservative virtue. In November, Meg Whitman, the new Republican nominee in California, and Brian Sandoval, the new Republican nominee for governor in Nevada, stand a good chance to join their ranks.

Today’s conservative reformers appreciate that within its limited sphere government should be excellent. Promoting individual responsibility, self-reliance and opportunity requires targeted action, beginning with health-care reform that really controls costs by eliminating barriers on insurance companies operating across state lines and limiting malpractice damages; public-sector reform that reins in unions by reducing benefits and expanding accountability; and education reform that through school-choice programs gives parents, particularly in low income and minority communities, greater control over their children’s education.

None of this is to underestimate or denigrate the intellectual underpinnings of the Tea Party movement. Despite the media indictment (Racists! Know-nothings!), it is perhaps the most wonkish popular uprising we’ve had in the past century. It is the CATO  Institute’s dream mass movement — based on self-reliance, limited government, sound money, fiscal discipline, and market economics. Many of the protesters like to carry copies of the Constitution. For every inflammatory hand-painted sign that CNN films, there are dozens quoting James Madison, challenging the “bailout nation,” and contesting the constitutionality of an individual health-care insurance mandate. It’s certainly a step up from “Turn on, tune in, drop out.” But it is not a methodology for governing nor an agenda for what would follow Obamaism. You don’t write legislation in mass gatherings seeking to discredit and upend those in power. And it’s unrealistic and misguided to expect a mass movement to decimate a political agenda, defeat liberal one-party rule, defend itself against incessant media attacks – and come up with a health-care alternative, a scheme for entitlement reform, and proposals to tame the debt. (The latter is the work of Ryan, Daniels, Christie, et. al.)

The media narrative that the conservative movement is riven with conflict is, as is so much else the media spew, a distortion intended to bolster the spirits of the left and paint the right in the most disagreeable light possible. We actually have witnessed a rather effective division of labor on the right, with reformers and Tea Partiers collaborating on common goals. They share a mutual desire to put a stake through the heart of the statist agenda of one-party Democratic rule and to find a better alternative. The first task is well under way; the latter is just beginning.

Tax Day

“Can I deduct the cost of marijuana if it’s for medical use?”

“Only if you’re filing a joint return.”

The Cato Institute has an excellent short film on all that is wrong with the federal tax system. In short, that system violates all four principles of taxation described by Adam Smith:

1. The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state.

As Warren Buffett complained, his effective tax rate is half that of his secretary.

2. The tax which each individual is bound to pay ought to be certain, and not arbitrary.

The system is so complex that not even professionals can be sure what people owe. Send out the tax information of a middle-class couple with children to six tax accountants and they will come up with six different sums owed. That experiment has been run numerous times. The advice the IRS itself gives out is frequently wrong.

3. Every tax ought to be levied at the time, or in the manner, in which it is most likely to be convenient for the contributor to pay it.

Most people never see the money, as it never gets into their paychecks. Those with incomes not subject to withholding must estimate in January, April, July, and October, regardless of whether those months are convenient.

4. Every tax ought to be so contrived as both to take out and to keep out of the pockets of the people as little as possible over and above what it brings into the public treasury of the state.

Well over 50 percent of filers hire people to fill out the forms because they can’t understand them. The corporate income tax is even worse. As the Wall Street Journal explains today, the cost of complying with the corporate income tax this year will equal 89 percent of the revenues received by the government. General Electric’s tax return, filed electronically, will be the equivalent of 24,000 pages long.

The current tax system benefits two groups: the rich and powerful, who are able to lobby Congress for loopholes, subsidies, tax credits, etc. etc., and the 535 members of Congress, who sell those loopholes, subsidies, tax credits, etc. etc. Yes, sell. They are traded for campaign contributions. It’s as legal as it is disgraceful.

There is no reforming the current system, as it is permeated with corruption. But Congress is utterly unable to write a new tax code from scratch. If this country is to ever get out from under a tax code that has become a clear and present danger to American prosperity and power, it will have to be done using a means similar to the military base closings after the Cold War: in secret, with Congress voting up or down, no amendments.

Only overwhelming pressure will make that happen. That’s another reason why the 2010 election might turn out to be the most consequential midterm election in American history.

Why State Budgets Are so Deep in the Red

A clear majority of the public, according to Rasmussen, thinks that the federal government should not bail out the state of California but rather let it declare bankruptcy. Even when told that the state might have to slash welfare and medical care for the disabled and elderly and cut state salaries by 14 percent, 53 percent favored that outcome over a federal bailout. Only 33 percent want the feds to help.

Bloated state payrolls are a large part of the problem with state budgets. While revenues have stagnated or fallen, employees have not been laid off, and salaries and benefits have continued to increase. These expenses now make up half of all state spending. As a Cato Institute report makes clear, state employees make out much better than do private-sector ones. In total compensation, state and local workers earn $1.45 for every dollar private workers earn. State workers get $2.18 in health benefits for every one dollar their private-sector counterparts earn. For every dollar in defined-benefit pension benefits given to private-sector workers, public-sector workers get $6.95. Some states allow workers to retire early, begin to collect a pension, and then go back to work for the state at their old job, earning a salary as well as a pension.

Federal workers do even better, earning more than twice what equivalent private-sector workers do. No wonder the ratio of government workers to the total population has been steadily falling. In 1940 there were about 31 Americans for every government worker. By 1970 the ratio was 18.5-to-1. Today it is 13.7-to-1. In this decade, the number of government workers exceeded the number of those in manufacturing. Part of the reason for that, of course, has been the great increase in productivity in manufacturing in recent decades. No such productivity increase in government, however.

And the most frequent non-governmental visitor to the White House since Obama became President? Andy Stern, president of the Service Employees International Union, which represents 1.8 million mostly government workers. It’s the largest and fastest growing union in the country. Its political clout is legendary, thanks to $60 million in contributions in the last election cycle and the ability to turn out large numbers of union workers at rallies.

The states cannot hope to regain fiscal health until the wages and benefits of state works are more nearly in line with those of the private sector.

No Chair When the Music Stops

California Governor Arnold Schwarzenegger expressed doubt and concern on Monday about the Senate health-care reform bill. National media haven’t given this nearly the coverage they awarded his expressions of support for the overall ObamaCare effort in July and October. But under the mainstream media’s radar, the Governator was going soft on the Democrats’ health-care reform as early as last week, and the reason for his shifting posture is the cost to California.

Schwarzenegger’s prior attempt at health-care reform in California makes a superb cautionary tale. The 2006 proposal, advanced by Democrats in Sacramento and substantially endorsed by the governor, was eerily similar to the U.S. Senate bill to be voted on this week. It incorporated an individual mandate to purchase health insurance; increased employer costs through either insurance premiums for workers or a tax penalty; vague and open-ended bureaucratic measures to control costs; expanded enrollment in Medicaid/Medi-Cal; and subsidies to those with incomes up to 400 percent of the federal poverty level who would be required by law to buy insurance.

There was no question this plan would cost more. Even friendly analysts concluded that it would add between $6.8 and $9.4 billion in state costs, while causing private health expenses to rise by 9.9 percent per year and employer costs to rise by 8.8 percent per year. California, the analysts pointed out, has 12 times as many “uninsured workers under 65” as Massachusetts; the Bay State’s solutions would be overwhelmed by sheer numbers in the Golden State.

Yet, until the housing-market collapse stopped California’s decade-long spending spree in its tracks, state Democrats were pushing their health-care reform proposal vigorously — with the support of the Republican governor. A CATO Institute analysis pinpointed why: the state Democrats’ plan relied heavily on federal matching funds. A bit of comically transparent budgetary sleight-of-hand would have enabled California to shift most of its additional costs to the other 49 states.

The bill in the U.S. Senate this month, however, will impose on California all the inevitable costs of mandating universal “insurance coverage” in California, and then some. California doesn’t have the advantage of recalcitrant Democratic senators whose votes need to be bought with Medicaid-funding relief, as Ben Nelson’s (NE) and Mary Landrieu’s (LA) were. California’s senators, Barbara Boxer and Dianne Feinstein, are some of the “safest” party-line voters in Congress. The result is a case of unpleasant consequences that must be humorous to those who don’t live in the Golden State.

The game of “musical health care costs” is only just starting across America. Senators Nelson and Landrieu think they have already grabbed their states’ seats for when the music stops. But the impact on the states — especially an unequal impact — may well be the spike on which the Democrats’ plan is ultimately impaled. Federalism, uniquely strong in America, has not yet had its say on this topic.

Copenhagen All Over Again

This Fox News report suggests that Copenhagen, the site of Obama’s Olympic-size humiliation, may be (to borrow a phrase from Yogi Berra) déjà vu all over again for the president:

At both meetings, the president scheduled very brief appearances, planning to arrive early and be long gone before any decision was reached. And, coincidentally, the destination in both cases was Copenhagen, Denmark. … Patrick Michaels, former president of the American Association of State Climatologists and environmental fellow at the Cato Institute, said he has his doubts. ”The president is carrying nothing credible in his pocket, so how can he compel people to do something credible?” he said, referring to the fact that Congress has not passed its cap-and-trade bill.

Even fellow Democrat Sen. Jim Webb is reminding Obama that he doesn’t have “the unilateral power to commit the government of the United States to certain standards that may be agreed upon” in Copenhagen. And then there is the peculiar challenge of an international confab to decide how to micromanage national economies based on science that is now the subject of comedy routines. It doesn’t seem quite, well, credible.

To avoid another major embarrassment, it’s possible that, as the Obami have been forced to do many times already, they will come up with a photo-op, or a meaningless working agreement to get to work on an agreement. Still, one wonders why the president is once again putting his prestige on the line when the chances of a payoff are slim. Well, I suppose it beats answering media questions at home about the looming Iranian threat and our domestic economic woes (and yes, another national unemployment figure due out Friday).

Arnold’s Failure Is The GOP’s Gain

Aside from the Florida primary, the biggest news this week, and the event with the most potential to affect the 2008 presidential race, was the defeat in California of Arnold Schwarzenegger’s healthcare proposal. It foundered when the Democratic state legislature figured out that it would have cost a boatload of money. Just how much? $14.9 billion.

The Wall Street Journal points out that this is an important policy lesson. An individual or government mandated health care system is very expensive and does nothing to stem rising healthcare costs, which are the real issue. The Journal‘s editors explain:

What the California collapse should discredit in particular is the individual mandate as a policy tool for Republican reformers. This was Mr. Romney’s enthusiasm for a time, helped along by the Heritage Foundation. But in order to be enforceable, such a mandate inevitably becomes a government mandate, and a very expensive one at that.
Voters are rightly concerned about health care, but they also don’t want to pay higher taxes to finance coverage for everyone. Mr. Schwarzenegger’s spectacular failure shows that there’s an opening for Republicans to make the case for health-care reform based on choice and tax-equity, not mandates and tax hikes.

If John McCain is indeed the nominee, he will have clean hands on this issue and a market-based healthcare plan that even the Cato Institute, which has led the charge against healthcare mandates, could love. McCain will now have some powerful examples to highlight why the healthcare approach of the two potential Democratic nominees is a recipe for failure.

REPUBLICAN DEBATE: Reagan Coalition, RIP

I don’t take Ron Paul’s ideas seriously, but his presence in this debate really is the best proof that Ed Rollins, Mike Huckabee’s campaign manager, is right: The Reagan coalition is gone.  Don’t just listen to Paul.  Go read the material put out by the Cato Institute. Listen to Chuck Hagel on the war in Iraq.  Follow the debate on immigration.  Think back to Republican reaction during the Dubai Ports World debate. For a brief moment, the Reagan coalition seemed to get together again in fighting the Harriet Miers nomination. Once that was taken care of, that momentary Reaganite unity disappeared.

Conflicted Libertarians

Last week at the Cato Institute, I debated Michael Tanner and former Congressman Dick Armey, two stalwart libertarians. The occasion was the release of Tanner’s book Leviathan on the Right, one of the better distillations of the argument that George W. Bush has frittered away Reagan’s legacy, increased the size and scope of government, and betrayed conservative principles.

But Tanner’s argument is not persuasive. For one, the often-shrill complaints of a few years ago about runaway federal spending now seem overwrought. To everyone’s surprise, the size of the deficit has fallen dramatically over the past two years. This year the deficit will be 1.6 percent of the economy–a level lower than in 18 of the past 25 years. The federal budget is projected to be in surplus by 2012.

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Maybe Al Gore Is Right

Conservatives like to think of themselves as hard-headed, flinty-eyed realists who draw conclusions based on the way the world actually works, not on the way they would prefer it to work. They deride liberals as sentimentalists who never let facts interfere with their preferred policy prescriptions, whether in favor of the minimum wage or arms control. Yet there are some issues on which conservatives will not let any amount of evidence shake their own faith-based politics. Global warming is a prime example.

Last week the United Nations International Panel on Climate Change released its fourth Summary for Policymakers, a publication representing the consensus view of hundreds of scientists from around the world. The experts found with “very high confidence” (meaning 90 percent certainty) that human activity is responsible for a substantial increase in greenhouse gases, and they warn that if left unchecked, these trends could have catastrophic ecological consequences within our lifetime. Similar reports have been issued by other expert bodies such as the National Academy of Sciences and the American Meteorological Society.

I’ve always been skeptical of global-warming arguments, but as a scientific illiterate, it’s hard for me to argue with the consensus of the scientific community. Many of my fellow conservatives, by contrast, refuse to concede the possibility that Al Gore may be right after all. Check out, among others: George Will, the Wall Street Journal editorial page, Senator James Inhofe, the Cato Institute, the American Enterprise Institute, and even Kevin Shapiro in the September 2006 issue of COMMENTARY.

I am sympathetic to some of their arguments, in particular when they point out the problems with the Kyoto Protocol, which mandates major emissions reductions by the U.S. and other rich nations while allowing growing pollution by developing nations such as China and India. In fact, some of the most effective answers to global warming may be politically incorrect—for instance, substituting nuclear energy for oil or coal.

But too many on the Right still refuse to acknowledge the basic reality that the climate is changing in potentially dangerous ways due to human activity, and that we need to reduce carbon emissions to address this looming crisis. Skeptics can always dredge up a rogue scientist or two to buttress their case, just as liberals can always find an economist or two to make the case for raising the minimum wage. But why should a few fringe figures dictate governmental policy?

I would think supporters of the invasion of Iraq would be more sympathetic to arguments for preventative action based on the best available intelligence.

From COMMENTARY: Health Care in Three Acts

As President Bush prepares to address the issue of health care in his State of the Union address, COMMENTARY is fortunate to have a trenchant analysis of the wider problem, “Health Care in Three Acts,” by Eric Cohen and Yuval Levin, coming out in the February issue. Here is an advance look.

Americans say they are very worried about health care: on generic lists of voter concerns, health issues regularly rank just behind terrorism and the Iraq war. And politicians are eager to do something about it. To empower consumers, the White House has advanced the idea of Health Savings Accounts; to help the uninsured, it has explored using Medicaid more creatively. Senator Edward Kennedy of Massachusetts, the Democrats’ leader on this issue, has backed “Medicare for all.” The American Medical Association has called for tax credits to put private coverage within reach of more Americans. A number of recent books have proposed solutions to our health-care problems ranging from socialized medicine on the Left to laissez-faire schemes of cost containment on the Right. In Washington and in the state capitals, pressure is building for serious reforms.

But what exactly are Americans worried about? Untangling that question is harder than it looks. In a 2006 poll, the Kaiser Family Foundation found that while a majority proclaimed themselves dissatisfied with both the quality and the cost of health care in general, fully 89 percent said they were satisfied with the quality of care they themselves receive. Eighty-eight percent of those with health insurance rated their coverage good or excellent—the highest approval rating since the survey began 15 years ago. A modest majority, 57 percent, were satisfied even with its cost.

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