The road to decay in my native country, Argentina, began with the implementation of one of the most powerful collectivist doctrines of the 20th century: fascism. The Labour Charter of 1927 –  promulgated by Italy’s Grand Council of Fascism under Mussolini – is a guiding document of this doctrine and provides for government-based economic management. This same document recommends government provision of healthcare and unemployment insurance. Sound familiar?

Since adopting its own brand of fascism, “Justicialismo,” Argentina began to fall in world economic rankings.

• In 1930, Argentina’s gold reserves ranked 6th. After the “experts” took over the central bank, reserves fell to 9th in 1948 (with $700 million), 16th during 1950-54 (with $530 million), and 28th during 1960-1964 (with $290 million).
• The Argentine central bank, created in 1935, was at first a private corporation. Its president lasted longer (seven years) than the president of the country, and it had strict limits for government debt purchases and even had foreign bankers on its board. It became a government entity in 1946.

When Perón assumed power shortly thereafter, he hastily expanded the role of government, relaxed central banking rules and used the bank to facilitate his statist policies. In just 10 years, the peso went from 4.05 per U.S. dollar to 18 in 1955 (and later peaked at 36 that same year). After Perón’s rule, Argentina further devalued its currency to 400 pesos per U.S. dollar by 1970.

Bipartisanship in bad policy-making can be especially damaging. Just as some of President Obama’s interventionist monetary policies were preceded by similar Bush administration policies, some of Perón’s policies were similarly foreshadowed: “Already before we reached power, we started to reform, with the approval and collaboration of the previous de facto regime,” said the populist.

Perón was removed from power in 1955 but his policies lived on.  The “Liberating Revolution” claimed it was leading an effort to return to the free-market system dictated by the Argentine Constitution of 1853.  But Argentines chose an interventionist, Raúl Prebisch, as minister.

Inflationary policies and political use of the monetary regulatory authority, especially after Perón’s first presidency, devastated the economic culture and rule of law of Argentina. In the United States, the Fed does not have all the powers delineated by Perón, and has not caused as much destruction as the Argentine central bank, but the process has been similar and more gradual. The U.S. dollar buys less than 10 percent of what it did in 1913 when the Federal Reserve was created, the debt limit increases regularly—thus stimulating further debt monetization—and monetary authorities have increased their arbitrary interventions.

Under Perón, government agencies gradually got involved in all areas of the economy.  We see a similar pattern in the United States–many sectors of the economy now depend on control, encouragement, or direct management. Obamacare is the best example; it is Perónism or corporatism on steroids.

There are similarities beyond the economic realm. Unlike other populist leaders, such as Hitler and Mussolini, Perón did not have belligerent imperialist ambitions. The same can be said about President Obama.  His conservative critics argue that he wants to reduce U.S. influence around the world.  Moreover, Perón shunned the Argentine founding fathers who favored the free society. Likewise, President Obama is not prone to quoting Madison, Washington, or Jefferson.

But some major differences between cultures still exist, such as the “cult of the leader,” attacking mediating institutions (e.g., Catholic associations and the press), and appealing to the left as well as the right.  Regarding the latter, Peron achieved vast influence over most of the three main components of fascism: labor unions, business corporations, and government. It’s not likely that a U.S. leader will gain control of all three of these in the near future.  During the beginning of the Obama administration it looked as though much of the business world was on board, but if there was ever a honeymoon, it didn’t last long. The Chamber of Commerce, for example, voiced its opposition during the middle of Obama’s first term, and continues to voice its criticism on several fronts.

Other differences, so far, are:

• The use of government funds for partisan efforts in Argentina is much worse than in the United States.
• The U.S. government is reluctant to directly attack capitalism.  Interventions are positioned as “going against capitalism to save capitalism.”
• In the United States, there is greater understanding of the dangers of protectionist and nationalist economic policies.
•  There is stronger support for the rule of law in the United States. The control of the judiciary by the Argentine government is reaching tyrannical levels.

A major source of hope in the United States is the strength and variety in governments among the 50 states and the richness of our civil society. Economic power is more diffused in the United Statesand some of it, as I noted in a recent column, is moving south to more conservative states. State spending and regulation has grown, but the federal government does not yet have the power to make the states follow all of its dictates and whims.

Pessimists may argue that the stage is set for an ambitious U.S. president, like it was for Perón, to make the majority of the economy dependent on government.  From the year before Perón assumed power and to the end of his rule (1945-1955), total spending by the central government averaged 11% of GNP; this compares with 24% in the United States today. Argentine conservatives created regulatory agencies thinking they would be used for the common good.  Likewise, U.S. conservatives have expanded government and regulations. The regulatory state is much larger today in the United States than in old Perónist Argentina. As with government spending, it can be used to control, encourage, or discourage business. Employed by both countries, excessive regulation is a more secretive means of picking winners and losers, which creates more opportunity for corruption. Perón understood that government spending and regulation could be used as tools of power to reward friends and punish enemies. He did it, and he ruined the Argentine dream.

What we’re seeing in many of today’s U.S. agencies, including the politicization of the IRS, demonstrates that the United States is not immune to the Argentine disease.  Indeed, if we fail to preserve the institutions of the republic, the American dream will be in grave danger.

Source: Forbes.com

Tyranny:

On May 5, while giving the commencement address at Ohio State University, President Obama advised graduates to put all their trust in government and reject those shrill “voices” that say it’s the source of our problems.

Ignore these limited-government types, he told the class of 2013, who warn “tyranny lurks just around the corner.”

Only, Obama himself has proved our fears are well-founded. Government, particularly governance by this rogue regime, needs more checks, not fewer; more skepticism, not less. Tyranny isn’t lurking around the corner. It’s now upon us, manifest in the pattern of misuse and abuse of government power by this presidency, as revealed in its:

• Siccing the IRS on its political enemies.

• Seizing the home phone records of journalists.

• Opening more criminal investigations of press leaks than all previous presidents combined.

• Intimidating and silencing government whistle-blowers.

• Doctoring CIA intelligence reports to cover up national security failures.

• Framing private lenders and other businesses for civil-rights violations.

• Funneling settlement funds from banks to Democrat nonprofit groups who weren’t even party to cases, including those that exist solely to shake down banks for risky loans and payola.

• Interfering in and sabotaging Supreme Court cases to protect unconstitutional prosecutorial weapons used against financial institutions.

• Running guns to foreign druglords and covering up their link to a federal agent’s death.

It’s no coincidence that the political timelines of the IRS and Justice Department fishing expeditions, as well as the Benghazi cover-up, all line up with Democrat political campaigns.

This is the government we have trusted to be the custodian of our personal medical records? This is the government we have trusted to police every consumer credit transaction?

It is imperative that Republicans now move legislation to repeal ObamaCare and Dodd-Frank, while immediately blocking further funding to enforce and implement new health and financial regulations.

As we have warned over and over again in the last four years, this is an exceedingly power-hungry president who has no respect for the Constitution or rule of law. He will continue to run roughshod over our individual rights and economic freedoms — if we continue to let him.

Source: Investors.com

Watch Jon Stewasrt’s TV show on the IRS scandal:

Kind of brings to mind Stalin’s quote “One death is a tragedy; one million is a statistic.”

But the issue is a serious one. Southeastern New Mexico is now facing yet another “endangered species” issue with the “Lesser Prairie Chicken.” Addition to the list could put a real damper on industry in Southeastern New Mexico.

I’m not saying that any wind farm that kills an eagle should be torn down; rather, I would say that the Endangered Species Act should be interpreted in ways that offer similar leeway to other industries and other uses of the land.

Source: Errors of Enchantment

We don’t need to restrict oil or gas exports. We need to open more lands to leasing and drilling.

The interminable war on drilling, fracking and the Keystone XL pipeline has taken some bizarre turns. Now it’s getting worse, as opponents grow more desperate, and the moon again grows full.

Deepwater drilling, 3-dimension and 4-D seismic (the ability to visualize 3-D over many years), deep horizon horizontal drilling and hydraulic fracturing, and other technological marvels have obliterated environmentalist claims that the United States and world are running out of oil and gas – and therefore we need to switch to subsidized, land-hungry, job-killing wind turbines, solar panels and biofuels.

Thanks to free enterprise innovation on state and public lands – and no thanks to President Obama, who has made nearly the entire federal onshore and offshore estate off limits to leasing and drilling – US oil and natural gas production has set an all-time record. The world is on the verge of doing so, as well.

Long-running geopolitics have been turned upside down, as OPEC, Russia and other oil superpowers wonder what hit them. Plastic and chemical manufacturers, steel makers, bus and fleet vehicle operators, and now long-haul truckers are already cashing in on the natural gas bonanza. So are electric utilities, especially with EPA continuing its war on coal, with more unnecessary heavy-handed air and water rules.

Global warming / climate change hysteria is also foundering on the rocks of reality. Average global temperatures haven’t risen in 16 years, seas aren’t rising any faster than 100 years ago, andstorms, floods and droughts are no more frequent or severe than over multi-decade trends during the past century.

Evidence and reality simply are not cooperating with IPCC and Mann-made climate models. “Trust the computer models!” the alarmists plead. “If reality doesn’t comport with our predictions, reality is wrong.”

The US State Department has (yet again) said the Keystone XL pipeline poses few environmental problems and should be approved, to bring Canadian oil sands petroleum to Texas refineries – creating thousands of construction and permanent jobs, and billions in economic growth and government revenue.

Unacceptable! rants the Environmental Protection Agency. “State underestimated KXL’s potential impact on global warming and needs to do its studies all over again,” says EPA. Never mind that oil sands production would add a minuscule 0.06% to US greenhouse gas emissions and an undetectable 0.00001 degrees C per year to computer-modeled global warming, according to the Congressional Research Service. Do it over, until you get the answers we want, demand EPA and environmentalist ideologues.

Some 70% of Americans and 60% of Canadians support Keystone – and energy security (and jobs) outrank greenhouse gas reduction as a national priority by a 2-1 margin among Americans – says Canadian pollster Nik Nanos.

However, haters of hydrocarbons, modern living standards, free enterprise and personal liberty are not ready to surrender. They’ve launched a blitzkrieg flanking attack. This time they are outraged that some Keystone oil could be refined into diesel and other products and exported! to Europe or Asia – while some frack-based natural gas might be converted to LNG and likewise exported!around the globe.

Well, yes. When US refiners transform crude oil into gasoline, diesel, jet fuel, heating oil, asphalt, waxes and petrochemicals, they ship some of these products overseas. Since Americans use less diesel than refineries manufacture (some parts of each barrel of crude can be converted only into diesel), refiners also export their excess diesel to Europe, which uses more diesel than gasoline, and Europeans ship their surplus gasoline to the USA, mostly to East Coast consumers. It’s a win-win arrangement that will be buttressed and safeguarded by Keystone pipeline transport of Canadian oil.

And yes, Cheniere Energy and other companies want to ship liquefied natural gas to foreign markets. It’s hardly surprising that anti-fracking activists would seize on this as yet another excuse for opposing this game-changing technology. It is hardly remarkable that Senator Ron Wyden (D-OR), Congressman Ed Markey (D-MA) and other far-Left legislators would sponsor bills to block LNG exports.

What is shocking is that Dow and Huntsman Chemical, Alcoa Aluminum, Nucor Steel and other companies are joining the no-export campaign. They have convinced themselves that such exports will hurt their own selfish economic interests – and for PR reasons have packaged that notion into assertions that exporting any US natural gas is against America’s and the public’s economic interests. Nonsense.

America has barely begun to tap its vast shale gas and conventional natural gas deposits. It has not yet touched its methane hydrates. Together, these deposits will likely last a century or more. In addition, other countries are racing to develop their own conventional, shale and hydrate deposits – while still others will eventually recognize the folly of keeping their own deposits off limits. All this will gradually reduce demand for US natural gas exports, slow and prolong extraction, and keep gas prices low.

This interplay will also help ensure that more factories and power plants in more countries burn natural gas, thereby replacing coal and providing the economic wherewithal to enable China, India and other nations to install modern pollution abatement technologies on their now dirty power plants. That will greatly improve air quality and human health in countless cities, while reducing carbon dioxide emissions and reducing consternation among steadily dwindling numbers of climate alarmists.

American oil and gas development – and exports – will also provide an opportunity for our nation to “give back” to the world community for all the petroleum that our anti-leasing, anti-drilling policies have caused us to take from the world’s petroleum supplies for decades. All this activity will also spur further innovation in technologies to unlock still more energy. It will spur job creation, economic growth and government tax and royalty revenue collection here in the United States … and abroad.

Some 23 million Americans are still unemployed or underemployed; 128 million are dependent on various government programs, including 47 million on food stamps; and the United States is more than $16 trillion in debt. Unemployment in the construction trades is 14.7 percent. Black unemployment was 12.7% when President Bush left office; it soared to 16.7% by September 2011 under President Obama, and remains stuck at 14% today for black adults – and an astronomical 43% for black teenagers!

Drilling, fracking and exports can reverse these horrendous, intolerable, unnecessary statistics.

Misguided industrialists should stop railing against exports. They would do themselves and our nation far more good by putting their lobbyists and public relations staffs to work demanding an end to leasing, drilling and fracking bans that continue to dominate eco-liberal thinking, US energy policy (especially under the current administration).

Of 1.8 billion acres on our nation’s Outer Continental Shelf, only 36-43 million are under lease. That’s barely 2% of the OCS. Offshore territory equal to 78% of the entire US landmass (Alaska plus the Lower 48) is off limits! Even the 2010 Gulf of Mexico oil spill cannot justify that.

Onshore, it’s just as bad. As of 1994, over 410 million federally controlled acres were effectively off limits to exploration and development. That’s 62% of the nation’s public lands – an area nearly equal to Arizona, Colorado, Montana, New Mexico, Utah and Wyoming combined. The situation has gotten progressively worse, with millions more acres – and vast energy, mineral and economic bounties – locked up in wilderness, park, preserve, wildlife refuge, wilderness study, Antiquities Act and other restrictive land use designations, or simply made unavailable by bureaucratic fiat or foot-dragging.

Drilling opponents claim to be protecting the environment. In reality, they simply detest hydrocarbons, modern living standards, free enterprise and personal liberty. Commonsense policies will rejuvenate our economy, put Americans back to work, and help fund government programs that Messrs. Obama and Reid profess to care so much about – while safeguarding ecological values we all cherish.

Paul Driessen is senior policy advisor for the Committee For A Constructive Tomorrow (www.CFACT.org) and author of Eco-Imperialism: Green power – Black death.

Source: HACER

Speaking about Templeton’s legacy, John Schott is quoted as saying “Well, as a human being, I am sure that his legacy will be his foundation and what they will achieve in time.” I am one of those lucky people who were able to spend time with Sir John, learn about his life and benefit from his generosity. I once asked him what gave him most joy in life. Very quickly and candidly he answered that his biggest source of joy was his philanthropic work. When I asked him to be more specific, he gave the example of his support to increase awareness about how prayer and spiritual life can affect healing and health. Prior to this philanthropic enterprise there was almost no one teaching this topic. Now, such courses are offered in a majority of medical schools throughout the country.

His success in this area led him to seek similar outcomes in promoting free enterprise and the principles of the free society. His performance in business made him the leading entrepreneur in mutual fund global investments during the 20th century and his insights and legacy carried on by theJohn Templeton Foundation are having a major impact in promoting intellectual entrepreneurship in the 21st century.

From his basic outlook about economics and politics it’s easy to see that Sir John was a “Classical Liberal” not a Libertarian Anarchist. He stated that “you do have to have some minimum kind of government. But to the extent possible, governments should try to stop interfering with what people want to do.” He also avoided investments in products that created harm.

He had a clear idea of what was conducive to human flourishing and what conspired against it. He argued that the “search for investment bargains involves looking for political and social contexts where free enterprise is thriving.” He sought investments in companies where the conditions and trends were favorable to the entrepreneurial spirit. Promoting entrepreneurship was one of his passions.

Importantly, he saw that “the problem that socialism poses for the investor can ‘hardly be overemphasized,’” and he avoided investing in companies that were largely owned or controlled by governments. He also saw the danger that socialism poses for the human spirit.

Sir John paid strong attention to the economic and intellectual environment where target companies operated. He used extensive analytical research, studied the great free-market classics and had personal conversations with business leaders to get a sense of trends. Moreover, he valued the human and social side of entrepreneurship believing “every successful entrepreneur is a servant. He must be oriented to matters outside of himself. He has to look to consumers and their needs. He must rely on their voluntary patronage to bring about his goals. That is service.”

Other Templeton investment principles described in the “Touch” are successfully guiding his philanthropic legacy:

· Looking for opportunities all over the world: “The global aspect is the greatest legacy” argues Paul Matthews in one of the chapters.

· Do not invest in areas with lack of transparency. Sir John avoided IPOs as the sector was not as transparent as that of publicly traded corporations.

· Think about “areas that other people are not thinking about.” Jane Siebels remarks in the book about Templeton’s passion to “open other people’s minds and broaden their scope.”

· There is always need for more research and more learning. A favorite maxim of Sir John was that “success is a process of continually seeking answers to new questions.” He applied this not only to investments but also to his entire philanthropic outlook. Even the Bible and other sacred books need to be complemented by free and open research seeking to discover new spiritual truths.

· Giving is also the essence of networking. With networking becoming a key task in the battle for ideas, one of the lessons that Guy Spier, of Aquamarine Fund, learned from Sir John, can help guide many intellectual entrepreneurs working in this field: “What networking actually is, though, is the act of offering something for nothing in a large group of people.” If this recommendation to be generous in networking is useful in the for-profit sector, it is even more essential in the non-profit arena. Established groups such as State Policy Network, the Network for Teaching Entrepreneurship, as well as budding groups, such as the Network for Enlightened Women, need to continue to be guided by “the force of giving and generosity within the context of a network.”

The “Templeton Touch” is more about discipline, research and character building than about any magical “touch.” The lessons in this book can improve your investments and your knowledge about the best aspects of the free enterprise system. But when readers finish these 400 pages they are also left with inspiring principles for a better life. Templeton encouraged those around him to think positively; to be thrifty, especially with the use of time, not letting wasteful thoughts occupy your mind; and to be grateful and generous. Guy Spier sums up what he got from Templeton: “The key, I believe, is to know yourself, and know who you are, and not force yourself into pockets where you cannot fit.” Good message for our businesses and for our lives.

Source: Forbes.com

Non-comprehensive, none-of-the-below, Washington-dictated energy policies guarantee decline.

“We can’t have an energy strategy that traps us in the past,” President Obama proclaimed in March 2012. “We need an energy strategy for the future – an all-of-the-above strategy for the Twenty-First Century that develops every source of American-made energy.”

At first blush, this sounds like common sense. The US economy and lifestyle “depend on inexpensive and plentiful energy,” the Congressional Research Service noted in a 2005 report, but people tend to forget this until world events cause gasoline prices to spike. Then Washington reacts, CRS continued – passing the Energy Policy Acts of 1992, 2005 and 2007. However, the US still does not have a “comprehensive long-term energy policy” that balances increasing supply with conservation and defines the proper interplay between government and market forces.

Forty years ago, President Nixon announced “Project Independence,” in response to the 1973 oil cutoff by Middle East and other OPEC nations, with the goal of ensuring that “Americans will not have to rely on any source of energy beyond our own.”  His broad-based strategy begat the trans-Alaska pipeline (to get North Slope oil to Lower 48 markets), expanded onshore and offshore oil drilling, an all-of-the-above strategy for electric power generation that brought lignite mining and natural gas into prominence, and a host of conservation measures, including 55-mph speed limits.

President Carter brought very different thinking to Washington – policies that many believe led to declining US oil and gas production and economic “malaise.” President Reagan reversed Carter, but his successors, Congress, courts, environmental activists, regulatory agencies and disparate corporate interests launched American energy policies on a roller coaster ride. This history helps explain why comprehensive long-term energy policies and strategies are less logical and desirable than at first blush.

The term itself suggests policies devised and dictated by Washington, DC politicians, bureaucrats, lobbyists and pressure groups – many of whom have no real knowledge of or hands-on experience with energy, economics, science, technology, business or job creation.

In too many cases, the policies, strategies, laws, programs and regulations are crafted to promote specific ideologies, benefit companies and organizations with the best lobbyists, and secure tax breaks, subsidies and preferential treatment for political cronies, campaign contributors and politically correct ideas.

“All of the above” too often means all of the above ground and little or nothing below the Earth’s surface: wind, solar, biofuels and wood, for example – but little or no oil, gas, coal or uranium. In fact, more than any other in history, the Obama administration is using its executive powers to delay, obstruct, hyper-regulate, penalize and bankrupt the proven energy that is the foundation of modern living standards.

Similarly, the notion that proven energy strategies “trap us in the past” fails to recognize that “past” energy technologies (oil, gas, coal, nuclear and hydroelectric) actually provide 94% of the energy that powers America today; are abundant, reliable and affordable; and represent a monumental improvement over the wind, solar, wood, dung and water wheel power that feebly energized mankind for millennia.

Suggesting that we can abandon these vital 94% energy sources – in favor of new variations on antique technologies that Mr. Obama promotes as energy of “the future” – ignores the fact that these politically correct sources are expensive, intermittent, heavily subsidized and wholly dependent on fossil fuels. Moreover, any honest and meaningful cradle-to-grave analysis of wind, solar and biofuel energy reveals that these PC sources are land- and resource-intensive, environmentally damaging, and unsustainable.

The “comprehensive long-term energy policies and strategies” slogan also ignores where the real progress of recent years has been made: in the private sector, especially the petroleum industry, where revolutionary horizontal drilling and hydraulic fracturing technologies have unlocked centuries of oil and natural gas worldwide. In fact, “fracking” on state and private lands has sent US petroleum production to new heights – even as Washington politics and policies have ensured that production from federally owned and controlled onshore and offshore lands continues to decline.

Hydrocarbon, hydroelectric and nuclear have undeniable problems: oil spills, air and water pollution, radiation and accidents. But laws, regulations, technologies and greater corporate responsibility have greatly reduced their frequency and severity – and errors are quickly and severely punished.

By contrast, human health and environmental impacts associated with wind, solar and biofuel energy are routinely and systematically ignored, and almost never punished. The slaughter of millions of birds and bats annually by US wind turbines is a case in point, and when the impacts are considered in the context of the minimal energy produced via these “renewable” technologies, the damage is especially egregious.

These “alternative” technologies ALSO require perpetual subsidies, taken from hardworking taxpayers and productive sectors of our economy, and given to crony corporatists whose schemes slide repeatedly into bankruptcy. They employ rare earth metals and other raw materials that require vast amounts of fossil fuels, monumental earth removal and widespread land degradation – to build and operate facilities whose energy is so expensive it kills 2-4 jobs for every “green” job created, drives families deeper into poverty, and impairs human health and welfare.

Forty years ago, President Nixon actually sought to develop and utilize “all of the above” energy – every practical source on every list. Today, amid an anemic economy and joblessness far worse than official government figures admit, President Obama balks at approving the Keystone XL pipeline, cancels leasing and drilling on federal lands, tells our budget-sequestered military to buy $26 to $67-per-gallon ship and jet fuel, punishes refineries for not buying cellulosic ethanol that doesn’t exist, and happily lets EPA shut down coal-fired power plants and kill countless thousands of mining, utility and other jobs.

Thoughtful Americans find little comfort in these policies. Twelve million still cannot find work in this moribund, DC-dictated economy. Red-state Democrats like Joe Manchin(D-WV), Mark Begich (D-AK) and Mary Landrieu (D-LA) tremble at the prospect of facing voters in 2014. And outrage is properly growing over the massive failures of wind, solar and biofuel startups whose executives (mostly Obama and Democrat campaign angels) skimmed millions of tax dollars for themselves but let their companies go bankrupt and their employees go on unemployment and welfare rolls.

And still President Obama and his minions push for punitive carbon dioxide regulations and carbon taxes, while the European carbon market collapses, EU jobs head to China and India, and thousands die of hypothermia in England. The European emissions trading system is “below junk status,” according to The Economist, and the collapse has been felt as far away as Australia, whose political leaders prepare to reap the whirlwind of carbon taxes that are now 5.5 times higher than in Europe. Is this America’s “future”?

Will ideology continue to trump sanity in the Obama energy and climate policy arenas? The President is putting all his eggs in the basket of “hope” that Democrats will “change” the House leadership and extend their Senate majority in 2014. He has shown little desire to compromise on energy and climate change.

America does not need “comprehensive” energy policies devised and dictated by Washington. It needs policies that unlock our creative genius and allow free enterprise and private sector innovators to operate on a level playing field – one that applies the same reasonable, responsible environmental, endangered species, tax, subsidy and other laws and standards to all companies, investors and energy technologies.

We need simple laws and policies that let our ultimate energy resource (our creative intellect) work – without ideologues, pressure groups and regulators promoting failed, subsidized energy schemes, while continuing to block affordable, dependable energy that actually creates jobs and generates revenues.

*Craig Rucker is executive director of the Committee For A Constructive Tomorrow (www.CFACT.org).

Source: HACER

This deserves far greater attention than it’s getting, given that Mexico, beneath the happy handshakes, is pretty much kicking critical U.S. forces out of the country.

According to a report in Sunday’s New York Times, Mexico has stopped sending its high-ranking officers to the U.S. to be polygraphed, a key way to weed out corrupted officials from high office.

It’s also thrown out U.S security officials from a major intelligence center in Monterrey, where they had worked side by side with Mexican officials to analyze tips on cartel activity. Now the data won’t be shared.

Drones flown over cartel-kingpin hideouts in the Mexican badlands have also been scrapped.

U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives investigators also were evicted from an investigation into a major gas explosion at the Pemex state oil company headquarters in Mexico City last January, after they asked to probe whether the inferno may have been caused by a bomb.

If Mexico’s war were won, it would be no problem, the U.S. would be as happy to leave as the Mexicans would be to see the U.S. go. But the war hasn’t been won not by a long shot. In fact, there is evidence it may be getting worse.

Killings average about 50 a day and the death toll is approaching 100,000. The private intelligence forecasting firm Stratfor reports that in the northern Chihuahua state, a surge in violence is afflicting its central region as the Los Zetas-linked La Linea gang shoots it out with the Sinaloa Cartel.

There have been new grotesque cartel killings in Veracruz and Acapulco, including one incident where several headless bodies were placed on plastic chairs in a public place.

Such problems won’t go away by ignoring them.

Yet Enrique Pena Nieto, who was elected by a war-weary Mexican public apparently to just make the cartel war go away — and whose party is widely known for appeasing rather than destroying drug cartels — seems to be prioritizing headline control instead of criminal control as his means of dealing with the issue.

All this calls for U.S. leadership. But the U.S. president is going right along with the ignore-it-and-it-will-go-away approach, leading again from behind.

Source: Investors.com

In a recent media monetary policy media slugfest between The New York Times and The Atlantic, on one side, and Bloomberg.com and Forbes.com on the other, analyzed here, recently, the gold standard prevailed.  It is noteworthy that gold’s victory in that skirmish came in a larger context.

The gold standard used to be consigned, mainly (to borrow a perfectly turned description from the Wall Street Journal’s Gregory Zuckerman and Carolyn Cui) to those with “bleak economic outlooks or dystopian views of society.” Then, many of gold’s proponents could be dismissed, facilely if not quite fairly.  The gold standard had been frozen out of elite discourse.

No longer.  The discourse has changed.

Dramatically.

Whether one supports it or opposes it, the gold standard no longer is seen by most serious thinkers as fringe.  It no longer is dismissible merely by invoking shibboleths like “barbarous relic” or “cross of gold.” Facts are stubborn things, as John Adams once observed.  Facts are much more stubborn than mere mockery.

There are reasons for the turnaround in the gold standard’s reputation. Rigorous thinkers such as analysts from the Bank of England, in its December 2011 Financial Security Paper No. 13, “Reform of the International Monetary and Financial System, have assessed the performance of the fiduciary dollar standard and found it deeply inferior to the actual performance of both the gold and of the (before it inevitably, due to an inherent latent defect, collapsed) gold-exchange standard.  Now, after 12 years of “Dark Ages” economic growth rates, the incumbent monetary policy elites are beginning to appear slightly desperate to justify their prestige and attendant privileges.

Academic economists, almost to a man, still bitterly cling to a  hostility to the gold standard.  On Valentine’s Day 2012 Prof. Austan Goolsbee memorably tweeted:  “Roses are red. Violets are pink. Don’t listen to goldbugs. No one cares what they think.” He thereby threw into doubt his grasp of doggerel, horticulture and … monetary policy.

Yet reality is beginning to penetrate the culture notwithstanding the phalanx of mortarboards.  Academics of authentic intellectual integrity stand apart from the reactionary phalanx.  These notably include retired University of Georgia Prof. Richard Timberlake, Prof. Lawrence White of George Mason University, Prof. George Selgin of the University of Georgia, and Prof. Steve Hanke of Johns Hopkins University, among others.

And now there is an upsurge in important neutral discussion forums, such as ProCon.org, Intelligence Squared, and Debate.org giving the gold standard equal dignity with fiduciary currency.

Now Rep. Kevin Brady, chairman of the Congressional Joint Economic Committee, hasintroduced legislation to stabilize the dollar with reference, among other things, to gold, and another bill to convene a meticulously neutral bipartisan monetary commission to study six monetary policy regimes, including, with equal dignity, the gold standard.

Now as many as a dozen state capitals are directing their attention, in one way or another, to monetizing gold.  The elite media has taken note of this as significant.  It has notably been featured in The Washington Post, “Virginia coin moves closer to reality,’ at Bloomberg.com’s Trust in Gold Not Bernanke as U.S. States Promote Bullion  and Gillian Tett in the FT Magazine, Is the Dollar as good as gold? 

Mainstream political strategist Dick Morris, formerly, as a critic of the prophetic and dignified Ron Paul, was a gold standard mocker.  Now Morrispivots, enthusiastically, to embrace gold, saying: “Let’s face it. Politicians have abused the right to print money. We cannot trust them to limit their power and to face fiscal facts. The abuses of Obama and Bernanke illustrate this grim fact for all to see.  Gold is coming!”  (This columnist hastens to note: there is no need, or benefit, politically to weaponize the gold standard.  Properly configured it is neutral, leaning neither right nor left.)

The gold standard, in a new incarnation, quite obviously no longer is a fringe issue.  It has entered the mainstream.  The conservative, libertarian, and Tea Party Republican voter base, and the ethnic and union members of the Democratic voter base, are receptive.  Interestingly, blacks and union members, when polled, appear even more enthusiastic for gold than libertarians and conservatives….

Now the gold standard is beginning to move beyond the op-ed pages, pages which often serve as, as Clausewitz said of war, “politics by other means.”  The gold standard proposition is dignified by invitation of its proponents to dignified forums.  These are worthy of a closer look.  ProCon.org is a nonprofit forum with the mission of “Promoting critical thinking, education, and informed citizenship by presenting controversial issues in a straightforward, nonpartisan, primarily pro-con format.”  Last year it informed over 15 million unique visitors and served up almost 60 million pageviews on a variety of interesting controversies. 

ProCon.org is a resource for the engaged citizen seeking out both sides of issues.  It was called by The New York Times during the last election cycle “The most comprehensive tool for researching the candidate’s stance on issues.” Wikipedia, watch your back:  ProCon.org is sneaking up on you. 

ProCon.org recently opened up an impressively presented section on the renewed gold standard debate.  It cites Prof. Krugman and Ben Bernanke as leading opponents; Rep. Ron Paul, following the Austrian model, and Lewis E. Lehrman, with whose Institute this writer has a professional association, following the conservative model, as lead proponents. (It also includes, among others, five members of the Forbes publishing stable, Steve Forbes, Charles Kadlec, Prof. Brian Domitrovic, Nathan Lewis, and this columnist, as proponents.)

ProCon.org may be the most impressive resource of its kind but it is by no means alone in taking a respectful interest in the arguments for (and against) gold.  Intelligence Squared  recently featured a debate featuring publisher Steve Forbes and editor and author James Grant, leading gold proponents, against two gold opponents. Debate.org “a free online community where intelligent minds from around the world come to debate online and read the opinions of others” now presents a section on the merits of the gold standard.

These forums are rigorous, not fringe.  They do not pit astrologers against astronomers, phrenologists against neurologists, or alchemists against chemists.  Their treating the proponents and opponents of the gold standard with equal dignity is an important indicator of gold’s newly regained legitimacy.

It is worthwhile, also, to take a closer look at Congressional Joint Economic Committee Chairman Kevin Brady (R-TX) who, with a dozen colleagues, has introduced legislation, HR 1176, chartering a national centennial (of the Fed) monetary commission.  The commission’s stated purpose is to study the empirical track record of six different monetary regimes, explicitly including the gold standard.  This is not a gold commission yet provides additional evidence, were any necessary, of the restored respectability of the gold standard as a monetary policy reform option.

Let it be noted that the Monetary Commission of the Indianapolis Convention of 1897-98 laid the groundwork for the Gold Standard Act of 1900.  The National Monetary Commission, 1909-1912, did the heavy lifting that made possible the chartering of the Federal Reserve.  (The Fed was designed to more proficiently administer, rather than supplant, the gold standard and would benefit from returning to its intended mission.) Both commissions dramatically transformed both policy and history.  There are ample reasons to believe that a Centennial Monetary Commission might have similar impact.

The FT, the Wall Street Journal, NationalInterest.org, and Forbes.com (the last two admittedly by this writer) prominently observed, last summer, that the gold standard has gone mainstream.  It is beginning to dawn on our public intellectuals that it was the so-called “interwar gold standard” — the gold standard’s “evil twin” — that precipitated the Great Depression.  The classical gold standard was innocent and deserves to be exonerated and restored to polite society where it can contribute to general prosperity and welfare.

Monetary policy can be a force for stagnation, as now.  Or it can be a force for fostering a climate of equitable prosperity and robust job growth.  Time for elected officials, public intellectuals, journalists and us regular citizens to examine the evidence.

The discourse about the gold standard has changed.

Dramatically.

* Ralph Benko serves as senior advisor, economics, for American Principles in Action, advisor to and editor of the Lehrman Institute’s The Gold Standard Now, and is, with Charles Kadlec, the author of “The 21st Century Gold Standard: For Prosperity, Security, and Liberty” available for free download in ebook form here.  He also authored “The Websters’ Dictionary: how to use the Web to transform the world,” which won the “Trophée du choix des Internauts” (“The People’s Choice”) in the World e-Democracy Forum Awards, 2010, Paris, France. (Download a free and complete eBook version here.) He also manages The Gold Standard Facebook page. He was a junior official in the Reagan White House; founder of the Prosperity Caucus; and a member of the original Supply Side movement.

Source: Forbes.com

If “capitalism” is viewed as a dirty word, should think tanks “clean it up” or abandon it? Like other Americans who were not born in the United States, I still mourn the loss of the word “liberal.” In most of the world the word means nearly the opposite of what it means here. I doubt that the word capitalism will be “stolen” but should we mind if it gets lost? During my college years I was more than satisfied with the arguments in favor of capitalism provided in “Capitalism: the Unknown Ideal” by Ayn Rand, and Ludwig von Mises’ The Anti-Capitalist Mentality. In his great treatise, Human Action, Mises recognized that “the system of free enterprise has been dubbed capitalism in order to deprecate and to smear it.” He chose nevertheless to keep the word and redeem it.

Although Karl Marx did not create the word, it was after his work “Das Kapital” (1867) when the term “capitalism” began to be widely used to describe an economic system based on private property as the means of production. Marx remains the great labeler: “capital,” “the capitalist” and “the capitalist system of production” appear repeatedly in his writings.

Ludwig von Mises was never shy about engaging in intellectual battles with the other side on their turf and with their choice of words. He wrote that the concept of capitalism “if it means anything, it means the market economy” and that modern capitalism is “essentially mass production for the needs of the masses.” Audiences view terms such as “a system of free enterprise,” the “market economy,” and “mass production for the needs of the masses,” much more favorably than “capitalism.”

In other regions of the world, the word also has its problems. When Hernando de Soto, founder and leader of the Instituto Libertad y Democracia in Peru, was doing his field work, he asked small businessmen and street vendors if they were capitalists. Their answer was “No! Capitalists are those up there” (“los que están arriba”), which means those who are above or control “the law.” This is similar to today’s term “crony capitalism.”

Scholars from think tanks and the academy made important contributions to refocus the definition of the word and move it beyond the material aspects of economics. Israel Kirzner finds that discovery, or the unforeseen way to create wealth, is the essence of capitalism. The American Enterprise Institute’sMichael Novak finds that the human mind is the treasure and foundation of capitalism. He makes an effort to use as root the Latin word caput, or head. Discovery, innovation, creativity are the essence of capitalism while the private ownership of the means of production provides its environment but not its ends. “The distinctive, defining difference of the capitalist economy is enterprise: the habit of employing human wit to invent new goods and services, and to discover new and better ways to bring them to the broadest possible public,” says Novak.

Unfortunately, Kirzner and Novak are in the minority. Until their arguments crowd out the others, more allies of freedom will avoid the term. Going back to the Heritage Resource Bank meeting, only one person from almost 500 represented an organization which uses “capitalism” in its name: “Enlightened Capitalism.” Intellectuals seem obliged to use adjectives: “state capitalism” and “crony capitalism” for the bad; “conscious” or “democratic” for the good. The great investor, Sir John Templeton, decades ago began using the term “people’s capitalism” for a system which allows and encourages wide dissemination of property and wealth. That also has power. His son, Dr. Jack Templeton, correctly points out that capitalism was seldom used during the era of the ascendancy of free enterprise ideas from the Founding Fathers through the beginning of the 20th century.

Not everyone is giving up. One example is Fred L. Smith, chairman and founder of the Competitive Enterprise Institute, who has launched the Center for Advancing Capitalism. One of his goals is to mobilize businessmen to promote capitalism. For Smith, there’s no need for adjectives – only a capitalism constrained by rule of law and limited government deserves that name. On a similar crusade internationally, the former Czech Republic president, Vaclav Klaus, believes that giving up on the word capitalism is tantamount to surrendering to the enemy. Like Klaus, I am not fond of giving up on battles and although I seldom use the word, I still like the concept of “capitalism” to describe some aspects of the economic system. I sometimes even wear a tie that Steve Forbes gave me with the inscription “capitalist tool.”

Should we care if we lose the term capitalism? Assessing its popularity, or lack thereof, I recently reviewed the mission of 25 leading market oriented think tanks around the globe. I could not find a single one using the term. “Free enterprise,” “free-markets” “free-economy” and better yet “free society” will continue to crowd out “capitalism,” if not as a system, at least as a word.

* Alejandro Antonio (Alex) Chafuen, Ph.D., has been president of Atlas Economic Research Foundation since 1991. A member of the board of advisors to The Center for Vision & Values and a trustee of Grove City College, he is also the president and founder of theHispanic American Center of Economic Research. Dr. Chafuen serves on several boards including the Chase Foundation of Virginia, the Acton Institute, the Fraser Institute (Canada), and is an Active Honorary Member of the John Templeton Foundation.

Source: Forbes.com

Another month of disappointing job numbers is a painful reminder that the U.S. economy is struggling after almost five years of fiscal and monetary stimulus.

Since 2008, Washington policymakers have been pacing around the doctor’s office too afraid to take the bitter but effective pill America needs: slash federal spending and end the U.S. Fed’s life support for zombie banks.

Economically stagnant Britain shows us where this continued procrastination leads. Instead of dashing after our tea-drinking transatlantic neighbors, American policymakers should look to Estonia, which took its austerity meds and quickly returned to prosperity.

First, let’s look at the UK. In the four quarters following the British government’s announcement of austerity in June 2010, general government spending increased by 4.3%, a rate of growth that has increased since then.

Some “austerity.”

Whitehall also has been squeezing more taxes out of British citizens, with revenues increasing by 7.8% the first year and the rate of growth shooting up into double digits the next two.

And the Bank of England’s balance sheet has grown 334% since September 2008, as it’s tried to prop up bad assets held at London banks.

The result: A still-unaddressed gap between wages and labor productivity that has sapped British competitiveness over the past decade, stagnant export growth (which was actually negative in 2012), and net negative economic growth since 2008.

Meanwhile, Britain’s phony “austerity” program, which will last through 2018, has only served to prolong the pain by covering up fundamental problems with taxpayer money and newly minted pound sterling.

It doesn’t have to be this way. For a better way forward, let’s look at Estonia, which took its medicine as soon as the global financial crisis broke. It cut government spending relatie to its pre-crisis level drastically — 2.8% in 2009 and 9.5% in 2010 — and is now one of Europe’s fastest growing economies.

Tax revenues fell, too. Moreover, Estonia’s central bank refused to prop up banks that shipwrecked on the rocks of a real estate bubble.

Today, the country’s number of non-performing loans is half what it was during 2009-2010. Export growth rebounded strongly during 2010-2011 and has since remained above its pre-crisis level.

Estonia’s economic recovery is impressive enough, with unemployment now below the Euro Area average and having made up its total economic losses by 2012.

But the most astounding element of this story is that in 2011 Estonian voters reelected the very politicians who implemented austerity — and in greater numbers than the previous election.

What can American politicians learn from this? Quite simply, not to be afraid of the short-term consequences of pro-growth policies.

Unfortunately, we seem to be following the Brits, echoing their denunciations of “savage austerity” with fear mongering about such futile budget measures such as the sequester, which doesn’t even cut spending but only its rate of growth.

Federal spending has averaged 29% above its pre-crisis level and is expected to keep going up. Revenues, which had been falling prior to 2012, increased last year and will shoot up by double-digit percentages by year’s end.

Meanwhile, the Federal Reserve has more than tripled its balance sheet since September 2008 and continues to be the backstop for an inefficient financial sector beset by non-performing loans even as it finances a heavily indebted federal government that spends 17% of its revenues on interest payments alone — roughly the same as Spain and Italy.

The Fed cannot keep interest rates at rock bottom forever. U.S. policy makers must stop pretending it can and begin paying down the almost $17 trillion national debt before interest payments bankrupt the federal government.

Washington needs to cut spending — now at its highest peacetime level ever — and rein in the ever-growing federal regulatory state, which restrains entrepreneurialism and job creation.

According to my colleague Wayne Crews, regulations will cost the U.S. economy a whopping $1.806 trillion in 2013 — that’s 13% of the economy. Add that to total spending and government’s burden is equal to nearly half the entire U.S. economy.

With 3,708 rules issued in calendar year 2012 — and 4,062 new regulations at various stages in this year’s federal pipeline — government’s economic footprint will grow even larger.

It’s no surprise that in a January 2013 Gallup poll, 56% of small business owners said they are not seeking to hire new employees because of future costs associated with new regulations.

America is sick. Government is fat and the economy is fatigued. Worse, politicians suffer under the continuing delusion that if only they had more taxpayer money, then they could solve the very problems created by spending too much taxpayer money.

They need to snap out of the same fantasy world they share with their counterparts in the U.K., where dieting means eating more, and take the austerity pill. It will make everyone feel better. Just ask the Estonians.

* Melchiorre is the Warren T. Brookes Journalism Fellow at the Competitive Enterprise Institute.

Source: Investors.com

State-owned companies and institutions in socialist countries used to focus on output measurements, e.g., tons of steel, pairs of shoes, or the number of students attending a university. Think tanks can fall into the same trap by focusing on the number of books distributed, reports published, conferences held, and programs managed, without making an effort to measure outcomes and results.

Governments and for-profit corporations also have units that work like think tanks. Some of the outcomes can surpass all imagination. Think of those in government and the academy who decided to connect computers to communicate, or those in internal corporate think tanks, such as the one assembled by Xerox during the ’70s, and how their thinking contributed to today’s world. My focus, however, as in other columns, will be on non-governmental, non-profit organizations and the challenge of measuring their outcomes.

Think Tanks and NGOs produce different products and services, I usually mention four: research, education, advocacy, and “doing.” I use “doing” as the category of products and services that come from “Do Tanks.” This is more common in non-ideological non-profits: providing small-loans, installing water purification systems, and other similar endeavors. But several programs of think tanks, such as defending victims of unjust government regulations, or helping edit/draft a law or major document, also qualifies as doing. Measuring outcomes is easier in this area.

A new category of think tank products, which in this age of communication and information is becoming more important, is: networking. Helping connect donors and experts with the ultimate beneficiaries is a major focus of some organizations, including theAtlas Network.

With such diversity, it is natural that organizations have different ways of measuring outcomes. They include measurements focusing on:

· Media appearances in major news outlets, TV, radio or newspapers. Think Tanks should be explicit about how they weigh each outlet. In the United States, for example, being published in The New York Times, The Washington Post, or the Wall Street Journal, carries more weight than being published in other papers.

· Estimated advertising value of media appearances. Think Tanks that have products or services that compete, or are offered through the private for-profit sector, have additional tools to measure their output. Estimated advertising value of media appearances is a good example. Publishing an article on the web or a blog controlled by the NGO, if it is not carried by other media outlets, tends to have much less value, and is much more difficult to measure than publishing an op-ed in a leading newspaper, or having several minutes in commercial TV channels to promote a special cause.

· Text or language that was present in a research document by the think tank being used in bills and laws in the legislature.

· Number of congressional testimonies.

· Improvements in major indices, such as the economic freedom indices produced by the Fraser Institute and the Heritage Foundation, the Doing Business Index prepared by the World Bank and IFC, the Global Competitiveness Index, and others. Enhancing economic liberty is the most relevant ultimate outcome for the think tanks that I cover in this column. How much of the improvement of a country or region can be attributed to work by specific think tanks is not an easy task. Even observers who do not favor free enterprise give credit to the Fraser Institute (Canada), the IEA(U.K.), and ILD (Peru), for helping change the climate of opinion which made increased respect for economic freedoms possible in their countries.

· Economic impact generated through a public policy proposal made by an institute. Examples of this are: increased transparency resulting from more simple tax structures (such as the flat tax), massive creation of capital by improving property titles (as it happened in Peru), or huge reductions in interest rates resulting from dollarization (as it happened in El Salvador).

· Increase in the number of donors and contributions and other improvements in internal processes. Think Tanks can be seen as a product in themselves. Like churches, associations, private schools, and other mediating societies, they become a relevant part of civil society, acting as a healthy buffer between the state and the individual. The continuity and stability of such independent organizations is viewed as a healthy outcome.

· Stopping a spending project in congress or a tax increase, or improving the cost-efficiency of a government. Pioneer Institute conducts a yearly “Better government competition.” Winning proposals have generated measurable outcomes, saving hundreds of millions to taxpayers.

· Generate wasteful spending by the other side. In similar fashion as the “Star wars” program during the Reagan administration made Soviet Russia overspend, some creative think tanks are arguing that their work is making the enemies of free enterprise waste precious funds.

· Number, quality, and acceptance rate of applicants to attend programs or to work for the institute. The more that the educational programs offered by think tanks mimic those offered by universities, the more they will be able to use similar outcome measurements.

· Impact in social media. Measurements of Facebook’s “talking about this,” and “likes.” “Talking about this” should be weighted more than “Likes” as the latter can be a one-time action reacting to a campaign. The number of Twitter followers is also an outcome more than an output. With increased use of paid promotion through Facebook and Twitter advertisements, some of these measures might lose value as outcomes. Web traffic statistics continue to be tricky as a reliable measure of outcome. Most think tanks do not report web traffic in a consistent manner. There is a temptation to manipulate figures to appear good to donors who, in general, are not web-savvy. The number of unique visitors is one of the most reliable measurements, but independent sites focusing on estimating web traffic, such as Alexa.com are not accurate. A combination of measurements of traffic, Facebook and Twitter presence would still be valuable and most think tanks are feeling obliged to report about them.

· YouTube views and other certifiable measurements. Think tanks are competing with other educational NGOs, such as the Institute for Humane Studies, (I.H.S.) or the Khancademy in this segment. I.H.S.www.:LearnLiberty.org series of short educational videos, already viewed more than 12 million times. Khan is slowly releasing classes on topics which think tank also address, from economics, to American civics and political history.

· Judicial victories. Applicable mostly to organizations similar to the Institute for Justice, Pacific Legal Foundation, Landmark Legal Foundation, and other legal defense and advocacy organizations.

· Number of think tank publications adopted in university and college courses. This was one of the typical outcomes measured during the time when think tanks were more focused on research or dissemination of solid research than advocacy.

· Scholarly citations of papers and books written by think tank researchers.

It is time to try to reach other ambitious goals at think tanks. Cato Institute has an outstanding Center for Constitutional Studies. One of its outcomes has been to help redirect the debate on limits of governmental action. Cato’s president, John Allison, has been explicit about aiming even higher, taking the center to a point “when the professors at the Harvard Law School find it necessary to respond to the arguments of Cato scholars and when the Supreme Court Justices feel consistently obligated to consider the Cato perspective in reaching their judicial decisions.”

Achieving freer societies is not the task of think tanks alone. Media companies, universities, political parties and leadership, churches, and other actors also play relevant roles in the battle for ideas and their implementation. But as recent books such as“Masters of the Universe” and “Think Tanks in America” have shown, think tanks are a formidable force. An improved focus on outcomes rather than output will make them even more effective.

* Alejandro Antonio (Alex) Chafuen, Ph.D., has been president of Atlas Economic Research Foundation since 1991. A member of the board of advisors to The Center for Vision & Values and a trustee of Grove City College, he is also the president and founder of theHispanic American Center of Economic Research. Dr. Chafuen serves on several boards including the Chase Foundation of Virginia, the Acton Institute, the Fraser Institute (Canada), and is an Active Honorary Member of the John Templeton Foundation.

*Gonzalo Schwarz and Harry Kaldsted, of the Atlas Network, also conducted research for this piece.

Source: Forbes.com

President Obama said Tuesday that the “heinous” attack on the Boston Marathon is being treated as an “act of terrorism,” while investigators try to determine whether the bombing was the work of a terrorist group or “malevolent individual.”

“This was a heinous and cowardly act, and given what we now know about what took place, the FBI is investigating it as an act of terrorism,” Obama said.

“Any time bombs are used to target innocent civilians, it is an act of terror.”

The president spoke in more depth about the attack after delivering a brief statement from the White House Monday evening.

At the time, he did not refer to the strike as terrorism, though White House officials and Defense Secretary Chuck Hagel later did. Hagel on Monday called the explosion a “cruel act of terror.”

The president stressed Tuesday that officials still do not know who carried out the attack or why — or whether it was planned by a domestic or foreign terror group, or a lone-wolf individual attacker. He described the investigation as being in the early stages.

“We will find whoever harmed our citizens, and we will bring them to justice,” he said, while urging Americans to remain vigilant and report suspicious activity.

Officials say at least three were killed and more than 170 wounded in the pair of explosions that ripped through the finish line at the Boston Marathon Monday.

Shortly before speaking Tuesday, the president also issued a proclamation for flags at the White House and all public buildings and military posts to be flown at half-staff until sunset April 20. The proclamation said Obama ordered the lowering “as a mark of respect for the victims of the senseless acts of violence perpetrated” in Boston.

Earlier, Hagel delivered a strong condemnation of the attack during testimony before a House Appropriations subcommittee.

“(The attack) is clearly an act of terror and will be approached as an act of terror,” Hagel said.

He said the National Guard were among the first on the scene. He said the Defense Department is prepared to respond quickly to any request from domestic law enforcement.

While counterterrorism officials pore over data in an effort to search for advance threats and clues, the president is being regularly briefed by his Homeland Security team.

On the floor Tuesday, House Speaker John Boehner said the attack is “a reminder of just how vulnerable we really are in this era of modern warfare.”

Source: Fox News

Watch Obama speaking on the Boston terrorist attack:

High cost, no benefit does nothing to forestall agency’s quest for ecological utopia.

President Obama’s Environmental Protection Agency has already promulgated a tsunami of 1,920 regulations, many of which will bring few health or environmental benefits, but will impose high economic and unemployment costs, often to advance the Administration’s decidedly anti-hydrocarbon agenda. The Heritage Foundation has calculated that his EPA’s twenty “major” rulemaking decisions (costing $100 million or more annually) alone could cost the United States over $36 billion per year.

The latest example involves a third layer (or tier) of rules that the agency says will clean the nation’s air and save lives, by forcing refineries to remove more sulfur and other impurities from gasoline. EPA and refiners call the proposal Tier 3 rulemaking. Tier 3 tyranny is more accurate – as the rules would cost billions of dollars but bring infinitesimal benefits, and will likely be imposed regardless.

Since 1970, America’s cars have eliminated some 99% of pollutants that once came out of tailpipes. “Today’s cars are essentially zero-emission vehicles, compared to 1970 models,” says air pollution expert Joel Schwartz, co-author of Air Quality in America.

In addition, he notes, more recent models start out cleaner and stay cleaner throughout their lives. “As a result, fleet turnover has been reducing on-road emissions by an average of about 8 to10 percent per year.” Over time, that has brought tremendously improved air quality, and continues to do so.

Moreover, since 2004, under Tier 1 and 2 rules, refiners have reduced sulfur in gasoline from an average of 300 ppm to 30 ppm – a 90% drop, on top of previous reductions. Those benefits are likewise ongoing. Using EPA’s own computer models and standards, a recent ENVIRON International study concluded that “large benefits in ground-level ozone concentrations will have accrued by 2022 as a direct result” of Tier 1 and Tier 2 emission standards and lower gasoline sulfur levels” that are already required by regulation.

By 2022, those existing emission reduction requirements will slash volatile organic pollutants by a further 62%, carbon monoxide by another 51% and nitrous oxides 80% more – beyond reductions achieved between 1970 and 2004.

But even this is not enough for EPA, which now wants sulfur levels slashed to 10 ppm – even though the agency’s models demonstrate that Tier 3 rules, on top of these earlier and ongoing reductions, would bring essentially zero air quality or health benefits.

Viewed another way, further Tier 3 improvements would amount to reduced monthly ozone levels of only 1.2 parts per billion (peak levels) to 0.5 ppb (average levels). These minuscule improvements (equivalent to 5-12 cents out of $100 million) could not even have been measured by equipment existing a couple decades ago. Their contribution to improved human health would be essentially zero

To achieve those zero benefits, the new Tier 3 standards would cost $10 billion in upfront capital expenditures and an additional $2.4 billion in annual compliance expenses, the American Petroleum Institute says. The sulfur rules will raise the price of gasoline by 6-9 cents a gallon, on top of new fuel tax hikes and gasoline prices that have rocketed from $1.79 to $3.68 per gallon of regular unleaded over the past four years. These and other hikes will ripple throughout the economy, affecting commuting and shipping, the cost of goods and services, the price of travel and vacations. (White House and EPA officials claim the Tier 3 rules would only add only a penny per gallon to gasoline costs, but that is highly dubious.)

EPA believes the additional sulfur reductions are technologically possible. Its attitude seems to be, if it can be done, we will require it, no matter how high the cost, or how minimal the benefits.

Citizens need to tell EPA: “The huge improvements to date are enough for now. We have other crucial health, environmental, employment and economic problems to solve – which also affect human health and welfare. We don’t have the financial, human or technological resources to do it all – especially to waste billions on something where the quantifiable health benefits payback is minimal, or even zero.”

Moreover, there are better ways to reduce traffic-related urban air pollution. Improve traffic light sequencing, to speed traffic flow, save fuel, and reduce idling, emissions, driver stress and accidents, for example. That’s where our efforts should be concentrated.

Another basic problem is that EPA always assumes there is no safe threshold level for pollutants – and pollution must always and constantly be ratcheted downward, eventually to zero, regardless of cost.

This flies in the face of what any competent epidemiologist knows: the dose makes the poison. There is a point below which a chemical is not harmful. There are even chemicals which at low or trace quantities are essential to proper operation of our muscular, brain and other bodily functions – but at higher doses can be poisonous. There are also low-level chemical, radiation and pathogen exposures that actually safeguard our bodies from cancer, illness and other damage, in a process known as hormesis.

Even worse, this Tier 3 tyranny is on top of other highly suspect EPA actions. The agency has conducted illegal experiments on humans, used secret email accounts to hide collaborations with radical environmentalist groups, and implemented 54.5 mpg vehicle mileage standards that will maim and kill thousands more people every year, by forcing them into smaller, lighter, less safe cars.

EPA also expanded the ethanol mandate to promote corn-based E15 fuels (15% ethanol in gasoline). That means we must turn even more food into fuel, to replace hydrocarbons that we again have in abundance (thanks to fracking and other new technologies) but our government won’t allow us to develop, and to substitute for cellulosic ethanol that doesn’t exist (but EPA tells refiners they must use anyway). So corn farmers get rich, while consumers pay more for gasoline, meat, fish, eggs, poultry and other products.

The agency is also waging war on coal, automobiles and the Keystone XL pipeline – based on assertions that carbon dioxide emissions are causing “dangerous manmade global warming.” Even the UN’s Intergovernmental Panel on Climate Change, NASA, British Meteorological Office, and many once alarmist scientists now acknowledge that average planetary temperatures have not budged in 16 years, and hurricanes, tornadoes, floods, droughts and sea level rise have shown no statistically significant variation from century-long averages – even as CO2 levels have “soared” to 395 ppm (0.0395% of Earth’s atmosphere). True scientists increasingly recognize solar and other complex, interconnected natural forces as the primary drivers of Earth’s ever changing and unpredictable weather and climate.

These inconvenient truths have apparently had no effect on Administration thinking. Perhaps rising indoor CO2 emissions from larger EPA and White House staffs have “weirded” their thinking. The EPA’s yellow brick road to Eco-Utopia is not one our nation should travel. It will not take us to an economic recovery, more jobs, a cleaner environment, or improved human safety, health and welfare.

Nothing in the Clean Air Act says EPA needs to promulgate these rules. But nothing says it can’t do so. It’s largely discretionary, and this Administration is determined to “interpret” the science and use its executive authority to restrict and penalize hydrocarbon use – and “fundamentally transform” America.

EPA administrator nominee Gina McCarthy says EPA will “consider” industry and other suggestions that it revise greenhouse gas and other proposed rules. However, neither she nor the President has said they will modify or moderate any policies or proposals, or retreat from their climate change agenda.

We are desperately in need of science-based legislative standards, commonsense regulatory actions, and adult supervision by Congress and the courts. Unfortunately, that is not likely to be forthcoming anytime soon, and neither Republican Senators nor the House of Representatives seem to have the power, attention span or spine to do what is necessary. Where this all will end is therefore anyone’s guess.

* Paul Driessen is senior policy advisor for the Committee For A Constructive Tomorrow (www.CFACT.org), and author of Eco-Imperialism: Green power – Black death.

Source: HACER

Paul Krugman, in a blog entitledCranky Old Men, attacked a Sunday New York Times jeremiad  by former OMB Director David Stockman.  Stockman’s tirade, in fact, was more reminiscent of Allen Ginsberg’s Howl  — “who burned cigarette holes in their arms protesting the narcotic tobacco haze of Capitalism … Moloch! Solitude! Filth! Ugliness! Ashcans and unobtainable dollars!”  — than of an op-ed.

And yet, Krugman’s response possessed all the persuasive power of a 14-year-old’s sarcasm: “It’s cranky old man stuff, the kind of thing you get from people who read Investors Business Daily, listen to Rush Limbaugh, and maybe, if they’re unusually teched up, get investment advice from Zero Hedge.  Sad.”

Matthew O’Brien of the Atlantic Monthly, playing Robin to Krugman’s Batman, botched a rescue operation.  O’Brien got his facts badly wrong and came across as a propagandist, or apologist, rather than a serious analyst.  O’Brien concluded, in TheAtlantic Monthly, that “The gold standard didn’t save us from dystopia. The gold standard wasdystopia.”  Wrong.  O’Brien was called out by the centrist Bloomberg and the center-rightForbes.com, his reputation bruised, for concocting a counterfactual counter-narrative.

First O’Brien blood was drawn by Matthew C. Klein at Bloomberg, with The Gold Standard Wasn’t So Bad.  This was promptly and smartly followed, contradicting without explicitly mentioning O’Brien, again in Bloomberg, by Gold Bugs Had the Best Monetary Rule by Caroline Baum.  O’Brien’s total demolition was effected by Forbes.com’s Prof. Brian Domitrovic’s Trashing the Gold Standard Is Now the Stuff of Amateurs and in substance although not by name by Forbes.com’s Nathan Lewis in The Correlation Between the Gold Standard and Stupendous Growth is Clear.  Lewis, putting the wooden stake into the undead heart of O’Brien’s thesis: ”

Between 1870 and 1912 (the classical gold standard period), a period of forty-two years, industrial production in the United States rose by 682%.

Today, we live in an environment of floating fiat currencies, which began in 1971. Conventional academic wisdom is that this period has been a wonderful example of how economic management via currency manipulation can solve the terrible problems of the bad old gold standard years.

How did the United States do in the 42 years of floating fiat currencies, between 1970 and 2012? Industrial production rose by 159% over that time.

Even that mediocre result reflects some pretty good times in the 1982-2000 period, when the dollar’s value was crudely stable vs. gold around $350/oz. If you look at the periods where the dollar’s value fell significantly vs. gold — 1970-1982 and 2000-2012 — the picture looks a lot worse. During the twelve years of the 1970s (until the end of the 1982 recession), U.S. industrial production rose a meager 21%. Yes, 21% in twelve years.

During the 2000-2012 period, it rose by — get this — 7%. Not seven percent per year. Seven percent total!”

Keynes, a pragmatist, would not have let dogma, much less that oxymoron, Keynesian dogma, hobble his intellect in addressing such a deplorable growth rate.  Then the left weighed in.  Krugman himself got acidly critiqued by the populist progressive Mike Whitney inCounterPunch for blowing his debate with Stockman on This Week:

“People are worried about the debt and deficits and Krugman tries to allay their fears by saying the economic system is too complexified. What the hell does that mean? It’s that Krugman’s elitist way of saying, ‘You dopes can’t possibly understand the economy, so leave it all to us experts.’ … And that’s how it ended, with Krugman backing up against the ropes while Stockman delivered one haymaker after another like a windmill spinning in a gale-storm. Mercifully, moderator Stephanopoulos intervened and stopped the carnage, lifting the ex-investment banker’s gloved hand skyward and declaring him “This Weeks” new champ.”

Krugman, apparently trying to recoup from this humiliation (and O’Brien’s fumble) amped it up from his blog to the print edition.  In a New York Timesop-ed entitled Lust for Gold. There Krugman shed even more intellectual integrity, misrepresenting the claims both of gold’s leading proponents and subtly distorting the great Keynes: ”

So how can we rationalize the modern goldbug position? Basically, it depends on the claim that runaway inflation is just around the corner.

Why have so many people found this claim persuasive? John Maynard Keynes famously dismissed the gold standard as a “barbarous relic,” noting the absurdity of yoking the fortunes of a modern industrial society to the supply of a decorative metal. But he also acknowledged that “gold has become part of the apparatus of conservatism and is one of the matters which we cannot expect to see handled without prejudice.”

Prejudice?  Krugman demonstrably shows prejudice on both of his key points.  The leading proponents of a modern, 21^st century, classical gold standard have not, in fact, levied a claim that “runaway inflation is just around the corner.”  As Lewis E. Lehrman (with whose Institute this writer has a professional relationship), the eminence grise of the modern classical liberal gold standard, repeatedly has observed that gold demonetized behaves entirely differently from gold legally defining the currency (confounded, further, by the dollar’s status as reserve asset).   It is a technical impossibility under this peculiar circumstance to predict the liquidity balances desired by the marketplace itself and, thus, inflation.

The greater poignancy lies in Krugman’s distortion of Keynes.  In Lust for Gold, he quotes selectively from Keynes’s Auri Sacra Fames, an argument for “Representative Money” as superior to “Commodity Money.” In this work Keynes also states:  ‘Thus gold, originally stationed in heaven with his consort silver, as Sun and Moon, having first doffed his sacred attributes and come to earth as an autocrat, may next descend to the sober status of a constitutional king with a cabinet of Banks; and it may never be necessary to proclaim a Republic. But this is not yet—the evolution may be quite otherwise. The friends of gold will have to be extremely wise and moderate if they are to avoid a Revolution.”

Gold has attracted many distinguished friends, such as Lehrman; such as financier/philanthropist Sean Fieler, head of American Principles in Action (with which this columnist also has a professional relationship); such as publisher Steve Forbes; belle-lettrist  James Grant; John Allison, president of the Cato Institute; Seth Lipsky, editor of the New York Sun; Dr. Judy Shelton, of Atlas Economic Research Foundation; and Forbes.com’s own Charles Kadlec and John Tamny, among others, who are proving themselves “wise and moderate” in their gold advocacy.

It may be dawning on Krugman, as hinted at by the slightly less than typically bloodlustful tone of Lust for Gold, that he needs to begin to argue his position less cavalierly.  Krugman risks losing relevance by attacking a caricature of the gold standard, one that is not actually being promoted in the policy sector. And the repeated and plenary demolition of O’Brien’s arguments should cause all gold standard opponents to be much more scrupulous with actual facts.

The gold standard, if the parity price is set intelligently (and even generously), as it must be, is no “crown of thorns upon labor’s brow.”  Workers instinctively grasp this.  It is past time for Prof. Krugman, and other elite progressives, to pay closer attention to the actual ongoing debate within this policy arena.  It is high time for the left to cease reflexively grandstanding and to offer constructive distinctions about how to configure the ever-more-appealing gold standard the better to generate the kind of massive job growth for which it, repeatedly, has proved instrumental and even indispensable.

* Ralph Benko serves as senior advisor, economics, for American Principles in Action, advisor to and editor of the Lehrman Institute’s http://thegolddstandardnow.org, and is, with Charles Kadlec, the author of “The 21st Century Gold Standard: For Prosperity, Security, and Liberty” available for free download in ebook form from http://agoldenage.com. He also authored “The Websters’ Dictionary: how to use the Web to transform the world,” which won the “Trophée du choix des Internauts” (“The People’s Choice”) in the World e-Democracy Forum Awards, 2010, Paris, France. (Download a free and complete eBook version, http://thewebstersdictionary.com.) He manages http://www.facebook.com/pages/The-Gold-Standard/132694736755192. Benko was a junior official in the Reagan White House; founder of the Prosperity Caucus; and a member of the original Supply Side movement.

Source: Forbes.com

The other is more relevant: Think tanks seldom publish self-criticism or objective studies about their own operations. The few donors who analyze their grantees rarely share the results. This is especially the case if the projects or think tanks they supported were not successful. There are very few independent studies focusing on the history and operations of specific think tanks. One exception is the case study conducted by Harvard University which analyzes the first 10 years of thePioneer Institute, in Boston, Massachusetts. “Think Tanks in America” analyzes several leading organizations, and even those who disagree with several of his arguments—like me—can still learn from it.

I recently reviewed in this column “Masters of the Universe” by Stedman Jones. He credits think tanks for playing a role in creating a consensus favorable to market economics. Stedman Jones argues that there was a big dose of luck, and set of circumstances, which led to the “Thatcher-Reagan” revolution. Medvetz, however, gives more credit to the strategy and forces behind the think tanks for their influence and growth. He pays special attention to the special space that think tanks occupy in America.

According to the author, the growth of think tanks crowded out truly independent academic research, and he gives four main reasons why: 1) the economy is controlled by large holders of capital; 2) there is an imposition of market forces and jargon through the media; 3) universities are behaving more and more as corporations; and 4) the state is withdrawing funding from higher education.

His view can’t be more different than the one shared by leaders of market-oriented think tanks. They see an economy dominated more and more by the state, a media that is hostile to market forces, a university that is captured by left-leaning professors, and a continued state presence in higher education.

Medvetz sees academicians, the “autonomous social scientists,” as the natural competitors of think tanks. It gives me the impression that rather than competitors, he would like to see these academics as monopolists. They reacted in ways which reinforced the dominance of think tanks. Some of them continued on their road to “hyper-professionalization.” Speaking and writing for smaller and smaller audiences. Other social scientists decided to “engage in policy debates by imitating the style of intellectual production institutionalized in the space of think tanks.” In that way, even those who are more prone to government solutions lost some autonomy. Thus, the rise of think tanks reduced “the value of self-directed knowledge in public life.” Brookings, highly respected in the world of think tanks, also gets some criticism from scholars like Medvetz. Like others “once, media-shy, most began to shorten their written work, accelerate the pace of its production and shift their resources toward promotion and dissemination.”

He states that during the 1970s and ’80s part of the success of conservative think tanks was due to “enormous advantages in the receipt of material support from big business, a relative freedom from state repression which sometimes beset think tanks of the left” and the fact that they worked outside the universities. I think that the latter reason carries weight: being outside the universities allowed the think tanks to grow without having to deal with university politics and other constraints. Think tanks continued to grow beyond the ’80s, but donations from corporations are, on average, only 10 percent of the income of conservative and libertarian think tanks. Heritage and Cato receive less than 5 percent from corporations. Medvetz mentions only one case of harassment by the state against a left-leaning think tank (FBI monitoring of the Institute for Policy Studies). That is not sufficient to prove that “harassment” led to weaker, center-left organizations.

The book presents broad outlines for a sociological theory of think tanks. I found considerable value in his description of the “space of think tanks” or “a hybrid institutional arena situated at the nexus of the political, academic, economic, and media fields.” Depending on the background of the analysts, many fail to capture the strength and weaknesses of think tanks. Some critics see think tanks as more affordable lobbying firms, low level academic research organizations, aspiring media outlets, or conduits for business and political interests. Medvetz, however, argues that occupying an important role in each of those fields is the secret to their success. The ability to blur the boundaries among fields is the biggest asset of think tanks. The most successful are masters at convincing donors and audiences that they are playing an important mediating role in the social structure.

As a prime example of the power of think tanks, he focuses on the welfare debate and the “discourse of dependency.” Charles Murray is the hero or villain of this section. No personal slurs from Medvetz, but many side remarks about how discredited were Murray’s views among the so-called, “autonomous social-scientists.” Murray’s book “Losing Ground” was released and promoted by the Manhattan Institute. American Enterprise Institute, Heritage Foundation, the National Center for Policy Analysis, and the Cato Institute, are also mentioned as playing an important role. Medvetz writes that their attack on the welfare state was based on an extended defense of capitalism, a faith in the self-correcting tendencies of the market, and a moralistic attitude toward the poor. With so many resources devoted to this effort, by increasing the demand for policy experts who were willing to work with this framework, academics “faced increased pressures to frame their arguments according to the conservative welfare problematic.” As another example of think tank efforts that led to the passage of the 1996 welfare reform legislation, Medvetz mentions the 1987 AEI-published study, “The New Consensus in Family and Welfare: A community of Self-Reliance.”

There is much more to say about this book. It has an analysis of the background of senior think tank staff members, and another about the location and connections among think tanks. (With so much data, the book has a few historical mistakes and major misspelling of names. Heritage did not start the State Policy Network. It was started by Tom Roe, a trustee of Heritage.)

Since Thomas Medvetz completed his research, we have seen new competition for think tanks. More universities and colleges are allowing the growth of policy and research centers. In the area of advocacy, we also witnessed the explosive growth of Americans for Prosperity and FreedomWorks. Both originated from Citizens from a Sound Economy, which is mentioned in the book. I agree with Medvetz that think tanks have changed America. They will continue to help change, and hopefully protect, the American free enterprise system. Those of us who love the creative power of competition expect that the market will continue to evolve. As it happened in other countries, I expect that some think tanks will turn into universities. They will demand more academic talent, and hopefully, the quality of the policy analysis—as it happens with other products open to competition—will improve, both at think tanks and universities.

* Alejandro Antonio (Alex) Chafuen, Ph.D., has been president of Atlas Economic Research Foundation since 1991. A member of the board of advisors to The Center for Vision & Values and a trustee of Grove City College, he is also the president and founder of theHispanic American Center of Economic Research. Dr. Chafuen serves on several boards including the Chase Foundation of Virginia, the Acton Institute, the Fraser Institute (Canada), and is an Active Honorary Member of the John Templeton Foundation.

Source: Forbes.com

The current economic crisis has brought Margaret Thatcher’s ideas and ideals under siege, even though this disaster resulted from ignoring her, and Reagan’s, fundamental free-market principles.

Thatcher’s rise was astonishing. The notion that a grocer’s daughter could become leader of the Conservative Party and prime minister in class-ridden Britain seemed preposterous. In business, outsiders are usually the ones who radically shake up an existing industry or create an entirely new one. But in politics it takes a severe crisis for an outlier to emerge. Though he had a pedigreed background, Winston Churchill was very much the outsider, intensely distrusted and disliked by his own party and much of the public. Only when Britain’s very existence was at stake was he able to reach the summit. In Thatcher’s case it was an acute economic and social crisis that enabled her to emerge.

It’s hard to appreciate today how desperate Britain’s condition was before Thatcher took office. Its economy was a laughingstock, the perennial sick man of Europe. Strikes were endemic, and union bosses, in effect, governed the country. Thatcher’s Conservative Party had long ago made its peace with the welfare state and the ethos of high spending and high taxes. While the previous Tory prime minister, Edward Heath, wanted to revive Britain, he hadn’t a clue how to do it. In a make-or-break showdown with the National Union of Mineworkers, Heath called a general election under the banner, “Who Governs Britain?” He lost.

Great leaders have an astute sense of knowing when to take advantage of circumstances. Even though Heath had lost two elections, none of the senior party officials would challenge him. At the time Thatcher wasn’t regarded as one of the party’s major figures. But she was just about the only Tory who firmly believed in free markets and in Britain’s ability to again become a proud nation based on the principles of liberty. She was a devotee of the idea of paring back big government to give free enterprise room to flourish. Astonishingly, she beat Heath in a leadership fight in 1975 and led the Tories to victory in 1979.

During the campaign Thatcher exhibited that critical sense of timing. She vowed to honor already agreed upon pay settlements for nurses. This led some to think she didn’t have the backbone needed to turn Britain around, but she was exhibiting a great politician’s sense of knowing when to pick a fight. Thatcher eventually pushed through major labor union reforms. Shortly after she won reelection the coal miners’ union, which had destroyed Heath, decided to take her on. But, unlike Heath, Thatcher was fully prepared, beating the union resoundingly; a defeat from which it never recovered.

Thatcher also immediately began to slash income tax rates, rein in galloping spending and fight inflation. But one of her greatest innovations was the systematic selling off of government assets, dubbed “privatization.” After World War II Britain nationalized enormous swaths of the economy, actions that subsequent Conservative governments left largely untouched. Thatcher sold off government companies, and her example has been followed by countless nations around the world.

In the area of privatization Thatcher did two remarkable things. She pushed to sell much of Britain’s public housing, in which an enormous number of Britons lived, to occupants at low prices and on very advantageous terms. This was the beginning of her shifting people’s mentality and dependence on government. Her other smart move came in the privatization of government-owned companies when she offered a significant number of company shares to workers at very low prices. Union leaders hated privatization, but their opposition was undermined as members realized they could do very well by buying cheap shares in these newly privatized entities. Here again, Thatcher was changing people’s thinking, with workers taking on a more capitalist mentality.

Before Thatcher, many social observers thought Britain had an ingrained and unchangeable anticommercial culture, which would stand in the way of the country’s ever becoming an economic success. Yet within a decade of her taking office Britain had the most vibrant large economy in Europe, one even more dynamic and innovative than Germany’s. London became a magnet for entrepreneurs from France, Sweden and elsewhere.

One unchangeable characteristic of a great leader is the courage to take career-breaking risks when necessary. Thatcher demonstrated her mettle when Argentina’s military dictatorship seized Britain’s Falkland Islands. Defying almost the entire political establishment, which was haunted by both Britain’s military weakness and the memory of the Suez Canal debacle in 1956, Thatcher declared that the seizure would not stand and that Britain would go to war to take the islands back. She received critical help from the U.S., thanks in large part to the unrelenting efforts of Defense Secretary Caspar Weinberger (who years later became publisher and chairman of FORBES). Britain’s military expedition succeeded. The dictatorship fell, and democracy was restored in Argentina. For Britain the Falklands war was a huge boost to a demoralized nation. To the world it meant that tyranny would be resisted.

I met Margaret Thatcher several times during her reign at 10 Downing Street, including during, what was for me, a memorable interview in 1986. Most interviews with politicians are a useless exercise, as they know what they want to say and that’s all they usually do say. But Thatcher didn’t mind mixing it up verbally.

After she left office I got to know her on a personal basis. She visited us several times on vacation, and she was as impressive in private as she was in public. She was unfailingly gracious to everyone she came across. She had a keen intellect and was an indefatigable reader. She loved a verbal joust but was also a very warm and generous-hearted individual. She and her husband, Sir Denis, were clearly devoted to each other.

Margaret Thatcher was loyal to friends. I will be forever grateful for the help she provided when I ran for the Republican presidential nomination in 2000. She didn’t feel it proper to overtly endorse me, but she made it quite clear who her preference was by having me at her side as she praised me when she addressed a major Iowa fundraiser for local candidates in 1998. She was a wonderful mentor, and I only wish I had been a better student!

The heads of major nations today, sadly, are reminiscent of those from the pre-Thatcher, pre-Reagan era. May the memory of these two remarkable individuals–both of whom were motivated by a deep belief in the principles of liberty–inspire the successors to today’s lackluster and destructively misguided leaders.

Source: Forbes.com

Watch the video “Margaret Thatcher Remembered By Steve Forbes”:

The main battleground in the fight to break the prevailing political stalemate will be the fight to repeal what Senate Minority Leader Mitch McConnell calls the “monstrosity” of Obamacare.  Upon something like a plebiscite on Obamacare, and with it control of the Congress, entirely depends the fortunes of both political parties… and, perhaps, the literal health of America.

Memo to this columnist’s fellow Tea Partiers:  let’s throw McConnell, our strategist, a ticker tape parade!  The Obamacare fight is not a cynical exercise. It is a life and death issue.  Voters care deeply.  From the Republican base the Tea Party populist faction, small government conservatives, and libertarians all passionately oppose Obamacare.  From the Democratic base, progressives consider Obamacare a triumph of historic proportions, and it reportedly is popular among the Democratic-leaning ethnic base.

Meanwhile, the all-important Independents who control the political balance of power are … queasy.  The old system was in trouble.  But is Obamacare taking America out of the frying pan and into the fire?

The frying pan was (and is) very real.  Republicans are culpable for failing to provide intelligent free-market-based solutions (which certainly exist).  The United States spends the most in the industrialized world on health care.  And has some of the very worst health care, and health.  According to a 2011 article by Reuters,

“The U.S. healthcare system is more effective at delivering high costs than quality care, according to a new study …

The study, released on Wednesday by the 34-nation Organization for Economic Cooperation and Development, or OECD, said Americans pay … far more than any other OECD country — but still die earlier than their peers in the industrialized world.

The cost of healthcare in the United States is 62 percent higher than that in Switzerland, which has a similar per capita income and also relies substantially on private health insurance.

Meanwhile, Americans receive comparatively little actual care, despite sky-high prices driven by expensive tests and procedures. They also spend more tax money on healthcare than most other countries, the study showed.”

Enter Obamacare — which now has landed as the issue on which national politics almost is sure to hinge in the upcoming political cycle.  If indeed Obamacare degrades health care (and makes it more expensive and an even bigger hassle) it will prove more of a political liability than an asset. What does the political battlefield look like?

As ace political analysts, Larry Sabato and Kyle Kondik, observed on March 18^th in the Wall Street Journal:

“[T]he Obama White House wants to achieve something no other president has ever done: Retake full control of Congress in a midterm.

The party of an incumbent president traditionally loses seats in midterm elections. The usual strategy is simply to minimize the damage. Yet Mr. Obama and many Democrats are so buoyed by national polls and the buzz from the November election that they sense a chance to make history by holding their 10-seat Senate majority … and picking up the needed 17 House seats. That would clear the way for Democratic legislative aims.

A few factors work in the Democrats’ favor. …

A grand sweep will be harder than Democrats think, though. Electoral history and the nature of the 2014 races indicate that Democrats actually stand a greater chance of losing the Senate than they do of winning the House.

Since the start of the modern two-party system in the mid-19th century, the party of an incumbent president has never captured control of the House from the other party in a midterm election.”

On March 27^th the National Journal’s Chris Frates reveals in The Secret Republican Plan to Repeal ‘Obamacare’: And why the fight is far from over the GOP strategy to bring about its resurgence as “King of the Hill,” holding the House and taking a Senate majority: repealing Obamacare.

Senate Minority Leader Mitch McConnell — a political grandmaster, sometimes underestimated — reported that the Senate GOP was prepared, if they had won the majority, to “take this [Obamacare] monstrosity down.”  The Democratic majority, bolstered by the typical presidential year turnout surge, held solid in 2012.

“Monstrosity” is not an unfair description.  Frates:

“During the legislative debate over the law, Democrats promised Obamacare would create jobs, lower health care costs, and allow people to keep their current plans if they chose to. Those vows, Republicans argue, are already being broken.

The Congressional Budget Office, the Hill’s nonpartisan scorekeeper, estimated that the health care law would reduce employment by about 800,000 workers and result in about 7 million people losing their employer-sponsored health care over a decade. The CBO also estimated that Obamacare during that period would raise health care spending by roughly $580 billion.”

A takedown of Obama’s signature legislative achievement is not GOP partisanship, pettiness or obstructionism (although the left-leaning media will portray it that way).  Crushing 800,000 jobs and forcing 7 million people out of their health insurance is a bitter fruit indeed.  Obamacare was designed sloppily at best.   For those almost million people whom it will cause to lose gainful employment, or the 7 million who will lose their employer-provided health insurance, indeed it is monstrous.  FDR would have been appalled.

What are the political implications? Republicans will need to win half a dozen seats to retake the chamber. So, what are the chances?

“There are six really good opportunities in really red states: West Virginia, North Carolina, Louisiana, Arkansas, South Dakota, and Alaska,” McConnell said last week. “And some other places where you have open seats like Michigan and Iowa. And other states that frequently vote Republican, an example of that would be New Hampshire. So, we’re hopeful.”

What are the policy implications?

Two decades ago, this columnist, browsing in a Washington bookshop, happened upon the greatest supply side columnist who ever lived, Warren Brookes.  Brookes shared an indelible insight.  He observed that it was possible to provide good health care at an affordable cost through the free market, rationing it by price.  And it was possible to provide good health care at an affordable cost by the government through state agencies, rationing it by thoughtful policy.  And that America had managed to create a monstrous hybrid of the two, the worst possible system: lousy care at unaffordable prices.

The Obamacare “monstrosity” is the apotheosis of what Brookes noted.  Americans deserve better.

The National Journal concludes the most politically salient column of 2013 to date by saying that “McConnell [is] a brilliant defensive coordinator who will have to play flawless offense if he hopes to take control of the Senate next year.”  Yes, he does.  Likely, he will.

The chickens of Obamacare are coming home to roost.  There are some mighty ugly chickens in the flock.  Given the uglier side of Obamacare now becoming visible, the historical trends, and McConnell’s strategic political savvy President Obama should be bracing himself to receive the political shellacking of a lifetime come November 2014.

Source: Forbes.com

Interior, Energy and EPA nominees raise serious questions that need to be addressed

In his second inaugural address, President Obama pledged to address “the threat of climate change” because no one can avoid “the devastating impact of raging fires, crippling droughts and more powerful storms.”  The President had said nothing about climate change during his reelection campaign –because that would have reminded millions of voters that he is committed to replacing hydrocarbons with expensive renewable energy and ensuring that electricity and gasoline prices skyrocket.

But with the election safely behind him, climate change is back on his agenda, even though the Earth has not warmed during the past 17 years; Hurricane Sandy did not end one of the longest stretches ever with no category 3 or higher hurricane making landfall in the USA; and longstanding “progressive” federal policies on timber cutting and fire suppression have made wildfires harder to control.

The President’s nominees to head the Interior and Energy Departments and Environmental Protection Agency – Sally Jewell, Ernest Moniz, and Gina McCarthy – are all supposedly much more mainstream than their highly controversial predecessors.  The media has therefore criticized each of them from the Left, even though they are clearly all “team players” in a decidedly anti-fossil fuels administration.

Sally Jewell began her career as an engineer with Mobil Oil (now ExxonMobil), then switched to banking (advising on oil and gas asset management), before taking over as head of outdoors giant REI. She is touted as having business experience that is virtually nonexistent in the Obama Cabinet.

However, Jewell is being prodded to follow Bill Clinton’s practice of closing millions of acres from human activity, especially oil and gas and mineral leasing, but even livestock grazing. As a lifelong “outdoors enthusiast” whose “loyalties lie with those who view the public lands as a playground, not the source of commodities like minerals or meat” (according to Grist analyst Greg Hanscom), she may find land withdrawals an easy course to take – except where wind and solar installations are involved.

Although Jewell owns fossil fuel (and power) industry stock, she is also likely to toe the Obama line and support a carbon tax, further curbs on coal mining, more restrictions on Arctic oil and gas drilling, and similar actions. We think Congress should repeatedly question her on two major issues:

1) In light of the President’s “all of the above” energy policy and the clear challenge posed by Chinese ownership of most of the world’s rare-earth minerals, how does the need for energy and minerals development mesh with her and the President’s strategy for managing our nation’s public lands?

2) Given that all federal land lies within state boundaries, and that land use decisions affecting federal lands clearly affect state and local economies, what role should states play in decisions about declaring land within state boundaries as national monuments or other “off limits” categories – and regarding mineral leasing, livestock grazing, road building and other activities on federal lands?

Ernest Moniz has long championed the idea that revenues from fossil fuels and nuclear energy can help fund the transition to a “clean fuels” economy. He’s invested heavily in fossil fuel, renewable and “smart-grid” companies. He has not objected to hydro-fracking or offshore oil drilling. That has caused Leftists like Margie Alt of Environment America to complain that Moniz has a “history of supporting dirty and dangerous energy sources like gas and nuclear power.”

But such criticism is likely a smokescreen. Some suspect that Moniz is being brought onboard to be a lone administration voice in support of liquefied natural gas exports, despite testifying in 2011 that the U.S. will soon be a net natural gas importer, even as fracking was substantially increasing domestic supplies.  Similarly, his criticism of the flawed Cornell University study that demonized shale oil as worse than coal on greenhouse gas emissions makes him the perfect choice for future hand-wringing over some new study claiming that fracking could cause serious new environmental problems.

We think the Energy nominee should also answer two vitally important questions:

1) Given that Earth has not warmed for 17 years, despite steadily increasing carbon dioxide in the atmosphere, is it not time to question the wisdom of increasing energy costs for American consumers via carbon taxes, cap-and-trade or the EPA’s plans to rigorously regulate CO2?

2) Given the increasing focus on energy efficiency and conservation, what are the best ways to reduce transmission line losses; curtail impacts on agricultural lands, wildlife habitats, and bird and bat species from wind turbines, solar panels and biofuels; and help families and businesses reduce energy use and expenses – without further sacrificing employment, living standards, basic freedoms or ecological values?

Gina McCarthy as new EPA administrator raises quite different concerns. As Competitive Enterprise Institute analyst Marlo Lewis has noted, McCarthy is guilty of lying to Congress during 2011 testimony, when she and other EPA officials denied under oath that motor vehicle greenhouse gas emission standards played any role in agency implementation of 54.5 mpg fuel economy standards.

Lewis surmised that this false testimony was intended to protect EPA’s efforts to legislate climate policy under the guise of saving energy and implementing the Clean Air Act. The agency’s new fuel rules were devised with the auto industry during secret negotiations – but are unconstitutional Executive Branch lawmaking that will raise consumer costs and make cars smaller, lighter and less safe.

CEI energy policy director Myron Ebell also notes that McCarthy is up to her ears in the “Richard Windsor” scandal, in which outgoing EPA Administrator Lisa Jackson created a fictitious Windsor email address to hide her controversial communications from public scrutiny.  As such, says Ebell, McCarthy has “a strained relationship with disclosure and transparency.” (And with honesty, many would add.)

These actions belie suggestions that McCarthy’s state regulatory experience and face-to-face involvement with industry make her better able than Ms. Jackson to work with the business community. She may well do so with large companies that seek more subsidies, special regulatory arrangements, or regulations that penalize smaller competitors, hurt the economy as a whole or allow renewable energy companies to avoid environmental rules that apply to other industries. But she is unlikely to have a sympathetic ear for companies that she views as “polluters.”

Unless Ms. McCarthy can give honest, satisfactory, public answers to two important questions, her nomination should be rejected outright:

1) Under what authority does EPA assert the right to twist existing law, to create new laws that exceed clear legislative language, the stated intent of Congress, and historical or legal precedent?

2) Under what authority does an EPA official have the right to lie under oath to Congress, or use secret email accounts – thereby implying that Members of Congress are inferior to the Executive Branch, and avoiding disciplinary action because a partisan Justice Department shields Executive Branch officials from prosecution for such unlawful behavior?

Jewell, Moniz and McCarthy would all would be loyal servants to the Obama camp. And though each key bureaucrat takes an oath to uphold the Constitution and serve the public, history shows that any personal views that conflict with the official agenda will likely be reshaped and compromised as department directors carry out their missions. So despite serious concerns that many Senators have over the nominees’ likely policies, we anticipate the Senate will confirm Jewell and Moniz quickly.

McCarthy is another matter.  She has already demonstrated contempt for the Constitution and Congress itself.  Thus, despite claims that her experience and temperament suggest she will work well with Congress and the states, such a person – absent public repentance and a promise to chart a new course – should not be rewarded with any new opportunities to lie to, mislead and harm the public. No matter how noble the ends are purported to be, they cannot justify unlawful and disruptive means.

* Craig Rucker is executive director of the Committee For A Constructive Tomorrow (www.CFACT.org)

Source: HACER

GMU had the late Nobel Laureate James Buchanan and still has Gordon Tullock on its faculty, two great pioneers of the discipline. In 1967 Tullock wrote “The Welfare Costs of Tariffs, Monopolies, and Theft” and later, in 1974,Anne Krueger—the former chief economist of the World Bank—coined the word “rent-seeking.” As “rents” can be legitimate, I prefer to use “privilege seeking.”

Allow me to turn back the clock to three decades ago, when I received a surprising call. The Argentine Ambassador to the Vatican, Santiago de Estrada, who did not share my hardcore free-market views, asked me if I could visit with him. He was back in Buenos Aires for a short visit. As a young professor, and one of the few classical liberal professors at the Catholic University, I had started writing about the need for the Church to develop a new understanding of free enterprise.

Ambassador Estrada shared my concern. If I recall correctly, this is what he said: “I have been at meetings of the Pontifical Council for Justice and Peace. There is a sense of inefficacy; the economic teachings sometimes focus on aspirations, worthy goals, but seldom offer something more.” His legitimate concern was not the rich anthropology taught through the centuries by Christian churches, but the effort to give guidance to business and economic leaders. The aforementioned Council is in charge of that task and the one which released the document mentioning rent seeking.

It takes time for Catholic doctrine to incorporate evolving economic consensus. In 1987, John Paul II, at a major speech at ECLAC, the Latin American economic think tank of the United Nations, spoke in favor of private enterprise: “The challenge of poverty is so great that in order to overcome it, we must make the greatest possible use of private enterprise, with its potential effectiveness, its capacity to use resources efficiently, and the abundance of its energies for renewal.”

Years later, in his Encyclical Centesimus Annus, the Church endorsed the concept of a free economy under a rule of law. In point 42 of that document the Pope wrote that: “If by ‘capitalism’ is meant an economic system which recognizes the fundamental and positive role of business, the market, private property and the resulting responsibility for the means of production, as well as free human creativity in the economic sector, then the answer is certainly in the affirmative, even though it would perhaps be more appropriate to speak of a ‘business economy,’ ‘market economy’ or simply ‘free economy.’”

On other occasions, John Paul II spoke very highly of the role which entrepreneurs play in society: “[T]he degree of well-being that society enjoys today would have been impossible without the dynamic figure of the entrepreneur, whose function consists in organizing human labor and the means of production in order to produce goods and services. Without any doubt, your task is the first order for society.”

Today, most of the topics dealing with economics and free enterprise are handled by the Pontifical Council for Justice and Peace. Its work is conducted in consultation with experts from different social disciplines. It organizes seminars and releases different documents. Publications from the Catholic Church have different degree of authority, and—in this new era—statements range from Encyclicals to Twitter postings.

The Pontifical Council has been releasing “Notes” and “Reflections.” One year ago, it released a 30-page booklet, “Vocation of the Business Leader: a Reflection.” No other document from the Vatican has focused so much on the role of business leaders and entrepreneurs. It is intended “to be an educational aid that speaks of the ‘vocation’ of the business men and women who act in broad and diverse business institutions.”

In this booklet, the Council acknowledges the legitimate role “of profit as an indicator that a business is functioning well. When a firm makes a profit, it generally means that the factors of production have been properly employed and corresponding human needs have been duly satisfied. A profitable business, by creating wealth and promoting prosperity, helps individuals excel and realize [sic] the common good of a society.” The document recognizes the existence of crony capitalism and corruption and regards them as violations of principled entrepreneurship. It continues the tradition that sees businesses, in the language of John Paul II, as legitimate expressions of freedom. “Business leaders have a special role to play in the unfolding of creation—they not only provide goods and services and constantly improve them through innovating and harnessing science and technology, but they also help to shape organisations [sic] which will extend this work into the future.”

The Vatican is not and should not be a center for the promotion of concrete free-market or interventionist solutions. The Church does not have “technical solutions to offer or models to present”—that is the role of lay persons. For those of us who favor a “free economy” it helps to have outstanding economists, such as Nobel Laureate Gary Becker, as a member of the Pontifical Academy of Science. But economists of different persuasion are also part of the debate and influencing publications.

Cardinal Turkson, from Ghana, is the current head of the Council. It has Flaminia Giovanelli, in one of its leadership positions. She is one of the highest lay persons in the Vatican. Another one is Harvard UniversityProfessor Mary Ann Glendon, the first female President of the Pontifical Council of Social Science. Cardinal Turkson is familiar with the think-tank world, such as the efforts of the Institute of Economic Affairs in Ghana. Prof. Glendon knows the U.S. scene well. With the likelihood that Pope Francis will use his many pastoral charismas beyond the walls of the Vatican, I expect that each Pontifical Council, many working as think tanks and educational centers, will rise in profile. Pope Francis will take care of the faith. The economic views that come from Vatican documents will depend more and more on a fruitful dialogue between those of us in the laity, both Catholic and non-Catholics like Gary Becker, and the leadership team of each Council.

Source: Forbes.com

The golden opportunities that lie within the US Hispanic market is nothing new. They are educated, they like to spend money and there are many of them. But much like the mid 1800s, getting the gold has been nothing but spontaneous chaos.

Let’s start with the early years of the Hispanic Market Gold Rush; when the gold was accessible, shining on the ground just waiting to be picked up.

Talking to first generation Hispanics, today’s grandmas and grandpas, native Spanish dreamers who had just moved to America was as easy as picking up gold nuggets from the ground. It was simply talking to them in Spanish rather than English and using the obvious insight that you had left your home country for a better life. This Citibank ad clearly showcases work from the early gold rush era. Man can’t speak English, feels misunderstood, offer solution for his cultural barriers.

But Hispanics evolved. They learned English and began to understand American ways. It was harder to spot them in a crowd. So the gold was no longer found on the ground and fast-acting brands talked to a couple of Latinos and saw a couple of Mexican movies and began tapping into cliché cultural insights like quinceañeras (the Spanish version of sweet sixteen).

The music was loud and rhythmic, and there was a focus on family unity in an effort to dig a little deeper and capture the gold.

Kingsford Charcoal was one of those fast-acting brands. Here’s an ad showcasing everything from loud people to big families and colorful backyards, all part of the typical “Hispanic family” insight:

As the old gold gave birth to new gold, a second generation of Latinos was flourishing and brands began hearing the word “bicultural”. This term became the new drilling machine to get to the deeper gold. But it wasn’t long before it all became a combination of stereotypical moves like using Spanglish in ads. Here’s Toyota’s Spanglish effort:

Tide’s effort showcases both the first and second generation Hispanics and uses a combination of digging techniques to appeal to both:

Today, with a rising second generation of Hispanics, the gold rush mentality of tapping into the Hispanic market is more alive than ever, but mining is also more complex. The lines between cultures are blurring and todays younger Hispanics feel “ambicultural”, that is, they feel like they take the best from both the American and the Latino culture. They are proud Americans who feel part of the American mainstream and in many cases don’t even know how to speak Spanish. Many of today’s brands are using old mining techniques or failing to discover new tools to effectively reach the gold. Today, brands need to focus more on how to successfully integrate the Hispanic culture into mainstream American marketing, rather than alienating them and speaking to them as if they were different. The goal should be to make them feel like Americans who happen to have a Spanish last name, rather than a Latino who speaks perfect English.

Let’s look at a couple of examples of forty-niners who are not digging deep enough:

The Rolling Stone
In an effort to integrate the Hispanic culture in their general market issue, they introduced a 15-page insert in Spanish. This direct Spanish intrusion segregates the markets rather then seamlessly integrates them. The magazine should subtlety integrate Hispanic relevant content throughout the overall magazine, in English. This seamless integration reflects more of the American mainstream, plus not all Hispanics read Spanish.

ESPN
The sports network placed a Spanish Language ad in one of their English telecast channels. This makes no sense. It makes Latinos seem like they are different and even makes them feel uncomfortable. Latinos don’t have a “we want to take over America mentality”, but rather a “we are America mentality.” Brands need to understand that Hispanics are American and should not emphasize the differences. A cross language media buy just does not do the trick.

On the other side of the spectrum, there are some brands that are slowly capturing this integration and mining the Hispanic gold correctly. These guys are digging deep and going for the bigger chunks of gold:

Chevy

One of Chevy’s general market ads portrays a normal American family, but included a Latino name. This is a subtle Hispanic cue that welcomes Hispanics into the American world and lets Americans know Hispanics are American and the fact that a kid’s name is Toñito is perfectly normal.

McDonald’s

Another brand that does this well is McDonald’s. In one of their general market ads they showcase a hard-working man without stereotypically emphasizing his Latino characteristics. The only Hispanic cue was his last name. He could be any American farmer.

Brands today need to be “ambicultual” when it comes to mining the Hispanic gold. To effectively resonate with second and third generation Hispanics, brands need to make them naturally feel part of America, and also use subtle Latino cues. The goal is to mimic real American life. For example, a boy named Billy from Idaho seamlessly goes into a Chipotle and orders an order of tacos or a boy called Carlos Rodriguez goes to a Mumford and Sons concert and knows everyone of the songs.

Today, the tools to reach your Hispanic gold lie more in your general market communications than you think. It’s no longer about having a Hispanic agency, but a general market agency that naturally welcomes and understands Hispanics.

The gold is no longer on the surface. You need to dig deep and treat Hispanics like Americans and tell Americans that even though a boy’s name is Toñito, he still eats apple pie, loves the red, white and blue and has an Uncle named Sam.

Source: NYU Brandlab