Posts tagged with: politics

Blog author: kspence
Friday, November 11, 2011
By

Last week the Acton Institute hosted its third annual Chicago Open Mic Night downtown at the University Club. Three panelists answered questions about — you guessed it — economics and a virtuous society from the audience.

Acton executive director Kris Alan Mauren emceed the event, and our president Rev. Robert A. Sirico was the first panelist. Heather Wilhelm, a senior fellow at the Illinois Policy Institute and a columnist for RealClearPolitics.com, and Brian Wesbury, chief economist at First Trust Advisors and a frequent guest on Fox, CNBC, and Bloomberg TV, rounded out the panel.

The general theme of the night was something like, “how do we get the economy going again?” The panel’s general answer was optimistic: “It already is — just keep government out of the way.”

Mr. Wesbury was back after his popular commentary last year, and he delivered again this year: the last questioner got a friendly-but-stern talking-to after asking how the U.S. economy could possibly keep chugging along after the blows it has been dealt since 2008.

Whether the question was about the role of the Federal Reserve, the desirability of continued stimulus, or presidential candidates’ tax policy, the panelists generally agreed: the parts of the economy that government (particularly the Federal Government) hasn’t tried to help are doing much better than sectors like housing where sophisticated Keynesian policy instruments have been brought to bear.

Wilhelm quoted H.L. Mencken to great effect: “The urge to save humanity is almost always a false front for the urge to rule it.”

The task for current generations, Sirico said, is to learn from the failures of the baby boomers and to take up wholeheartedly the task of rejuvenating the culture, and he sees in the Tea Party, in homeschooling movements, and in a return to traditionalism, signs that that moral rejuvenation is happening.

Special thanks to Mr. Jim Healy (center, with guests)

Open mic night as it happened

An Italian friend of mine recently complained to me while painfully witnessing the climax of the Italian debt crisis: “Cosi Berlusconi, cosi l’Italia!” (As with Berlusconi, so too with Italy!).

My friend’s comment was an allusion to the Italian Prime Minister’s personal responsibility in dragging the entire Italian nation down with him. News broke late on Wednesday that Berlusconi had agreed to step down from office, as he effectively admitted his 17 years of political power had done nothing more to fix a broken system and as more members of his loose PDL coalition defected to centrist parties.

Even with the likely passing of the European Union fiscal reform measures designed to control Italy’s reckless public spending, it all seems too little too late.

With Berlusconi’s suprise announcement and Italy teetering on national debt default, the European stock markets tumbled late Wednesday. Logically, my friend then said, “Vedi? E cosi anche l’Europa” (See? And so too with Europe).

The domino effect is becoming a real potential. It is frightening. It is downright disturbing for anyone living and trying to survive in Europe. Still, we have to be careful of where we start pointing fingers.

My friend’s Berlusconi = Italy = Europe linear equation is not necessarily totally inaccurate.

The Italian Premier actually deserves some of the blame. For instance his center-right coalition government did recently raise capital gains taxes (from 10 to 20%!) along with corporate, personal income and VAT. This has further scared off the few serious local and foreign investors left in Italy and has sparked greater passion for the national pastime: tax evasion. This is the worst time to be raising taxes when economic growth is so wobbly at home. Berlusconi is an entrepreneur himself. He should know better. It is a total mystery why his business-friendly government is caving into Keyensian economic rebuilding.

All said, Italy and Europe is not a one-man disaster. Nor even a one-party disaster.

Italy’s national debt crisis is, above all, a crisis of national character – an Italian character that has become softened while shedding off its once great virtues of resilience, fortitude, integrity, self-reliance and innovation, just as we have seen in a paradigmatic shift in character with the rise of the modern Western European welfare states (watch Acton Media Director Michael Miller’s Acton Lecture – The Victory of Socialism, where he explains why socialism counts on citizens’ progressive external dependency on institutions and a loss of personal virtue).

France, Spain, Britain Germany Greece, Portugal, Belgium, Denmark. Take your pick: all have lost many of these same virtues of character in varying degrees. The Great Generation of post-World War II Europe is now too old to play the part of come-back hero.

No matter how great a vision or “business plan” the entrepreneurial Berlusconi had for Italy since the mid-1990s, no amount of collective cultural effort was ever possible when his country and Continent has lost its spirit of freedom and independence from big government and generous public programs.

National debt, while symptomatic of unsuccessful political regimes, is more the result of a national deficit of values and virtue.

Director of Research Samuel Gregg’s thoughts on the debate are up at The Corner. He sees a parallel between the Italian crisis unfolding across the ocean and the problems facing the United States — particularly in Michigan, where this debate was held. The collapse of Italy would certainly be a dramatic illustration of the shortcomings of crony capitalism, and Gregg thinks a candidate could find a majority of voters who don’t want that to happen.

With the Italian-flavored shadow of the European Union’s ongoing financial implosion overhanging the United States, it was expected that America’s own fragile economic state would be front-and-center at this debate.

This time, however, there was less argument among the GOP candidates. Instead, there were far more direct critiques of (1) President Obama and (2) the pattern of crony capitalism with which more and more Americans are visibly losing patience. The debate’s setting — the state of Michigan — is a living exemplar of all the fallacies of bailouts and business-union collusion, as well as a failure to promote the type of innovation that produces wealth but that also threatens businesses (like the Detroit car companies) that don’t like competition.

Also noticeable was the increased willingness of the candidates to advocate market solutions to any number of problems, the most prominent being America’s ongoing mortgage farce, the looming crisis of student debt, and the inexorable rise in health-care costs. That’s a welcome development. If this trend keeps up, maybe one of them will make the dismantling of crony capitalism a central plank of his platform. That won’t please the likes of General Electric and the City of Chicago, but there are surely votes there.

Mike Huckabee campaigns in Auburn Hills, Michigan (2008)

Many pundits have said that in recent American history the presidential candidate who has made the most references to God went on to win the election. There may be truth to the theory and already many candidates have rushed to highlight their faith for the electorate. President Barack Obama has utilized the “God talk” too for the upcoming battle. Last week he declared God wants to see the jobs bill passed.

Religion first played a notable role in the presidential election of 1800. In a rematch of the John Adams and Thomas Jefferson race , Federalist allies of Adams accused Jefferson of being “a howling atheist and an infidel.” In the 1980 presidential election, the Jimmy Carter campaign asked Ted Kennedy to attack Ronald Reagan as “anti-Catholic.” Kennedy, of course, dismissed the request out of hand.

If you are in Grand Rapids this Thursday, come here many more anecdotes from presidential campaigns and religion at Derby Station. We will discuss some of the presidential elections where faith was a major issue, such as 1960. In that race, America saw the first and only Catholic elected to the presidency. And is there a better place to discuss how prohibition played into anti-Catholic biases than a pub?

I will offer a short lecture, but this is primarily a discussion so come ready to contribute your own thoughts about religion and presidential campaigns. For all the details, here is the Acton event page and there is a Facebook page for this Acton on Tap as well.

Acton’s Kishore Jayabalan on Vatican Radio today. Summary:

The spectre of a hard Greek default and euro exit hung over a meeting of G20 leaders beginning in Cannes on Thursday. U.S. President Barack Obama said after talks with his French counterpart Nicolas Sarkozy that Europe had made some important steps towards a comprehensive solution to its sovereign debt crisis but needed to put more flesh on the bones and implement the plan. The world is counting on the G20 to find a way out of the crisis, before it begins spreading to other parts of the globe.

“A lot of what is happening…at the G20 summit in France over the next couple days is really the inevitable consequences of a three or four year unwillingness of European politicians, and I would say American politicians as well, to deal with what’s obvious to most people is paying attention to this debt crisis,” said Kishore Jayabalan, the Director of the Rome office of the Acton Institute for the Study of Religion and Liberty.

“At some point government leaders are going to have to be frank and tell people they can’t rely on government benefits indefinitely,” he told Vatican Radio. “The entire scheme was based promises that can’t be kept.”

Jayabalan said in the future, people are going to be forced to be more self-reliant, and create their own opportunities.

Click on the player below to listen in:

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

A couple weeks ago I engaged CPJ senior fellow Gideon Strauss in a debate at the Christian Legal Society, “Justice, Poverty, Politics & the State: Is There a Christian Perspective?”

One of the questioners afterward proposed that the large scale of the poverty problem required an institution equally as large, i.e. the government. There are lots of problems with that kind of analysis, not least of which is that the “poor” are not some homogeneous blob of humanity, but individual persons created in the image of God facing unique situations with their own unique gifts and talents. So the scale of the problem, perhaps counter-intuitively, calls not for some behemoth- or leviathan-size institution, but a variety of smaller individuals and institutions that can work with people individually and in communal settings. Think here of a variation on Burke’s concept of “little platoons” in the war on poverty.

Because of the nature of big society/government solutions, what we often end up with, unfortunately, when we seek a large institutional answer to the problem of poverty are safety nets that function not so much as trampolines as foam pits.



Perhaps not so funny when you think about it.

Acton On The AirIn the wake of the release of the Vatican’s Note on Global Financial Reform, the media has called on Acton for comment and analysis. Presented here are three interviews on the topic from the past few days; we’ll post more as audio becomes available.

On Monday afternoon, Acton’s Director of Research Dr. Samuel Gregg joined host Al Kresta on Kresta in the Afternoon to discuss the problems with the note:

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

The following day, Dr. Gregg joined host Drew Mariani on Relevant Radio to discuss the same topic:

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

Finally, on Tuesday Acton President Rev. Robert A. Sirico made an appearance on Kresta in the Afternoon that served as a preview to his discussion of the good and bad portions of the Vatican’s note in today’s Wall Street Journal, and sheds light on exactly what a “note” from the Vatican is:

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

Update: Sam Gregg audio clips are now working!

Acton’s director of research, Samuel Gregg, blogs about Cardinal Pell’s speech on global warming over at The Corner. He summarizes the remarks and then provides their ecclesiastical context, defending both the cardinal and the Pope from the radical left and from charges of submission to intellectual fashion.

[Pells] key points are simply that (1) the scientific debate is not over, (2) the climate movement has always seemed more driven by ideology than evidence, and (3) this isn’t a basis for implementing extremely costly policies.

The context of Cardinal Pell’s remarks is the growing concern among Church leaders about the radical green movement, whose positions are not confined to environmentalism.

It’s no secret that when it comes to those moral questions that are truly non-negotiable for Catholics (e.g., abortion, euthanasia), Greens invariably take the most permissive positions. Their hostility to robust religious-liberty protections is a matter of record. Moreover, anyone who delves into “deep Green” literature soon discovers frankly humanophobic ideas. Such are the concerns of some Catholic bishops that, before elections were held in the Australian state of New South Wales in March this year, Pell and most of the state’s Catholic bishops issued an unprecedented pre-election statement warning their flocks against the more troubling, less publically mentioned parts of the Greens’ party platform.

And what of Cardinal Pell’s friendship with Pope Benedict, who has been called the “green pope?” The mainstream media may try as hard as it likes, but

Benedict himself has wondered on many occasions (including during his recent Bundestag speech) about the disconnect between many peoples’ contemporary angst about the environment and their seeming indifference to what Benedict calls the “human ecology” of the natural law, which provides the only truly rational basis for human freedom, dignity, and civilization.

Leaving aside efforts to establish nonexistent tensions between cardinal and pope, the usual suspects — secular and religious — will surely excoriate Pell for this lecture. But in an age where far too many Christian thinkers are way too submissive to transitory intellectual fashions that make them acceptable at fashionable cocktail parties but also partakers in profound intellectual incoherence, it’s refreshing to know not everyone is so intimidated.

The aggrandizement of the European Union’s powers, particularly of its regulation, has had a steady growth within Europe, and is now looking to move outside European borders. Namely in one American industry, the airline industry, passengers may soon be paying higher air fares, not because of factors within the American financial market, but because of a carbon emissions tax that the EU will be imposing on American airlines which service flights to EU member countries.

For example, if an American carrier flies from New York to London, only a small percentage of the flight would be in the EU, but the U.S. carrier would be held responsible for the emissions from the entire flight. Just a few weeks ago, the European Court of Justice ruled that the EU is justified in levying fees on American flights than enter Europe. According to Patrick Michaels, a senior fellow in environmental studies at the Cato Institute, “Starting next year, the EU will tote up all the miles a plane flies to or from any European city, factor in the fuel usage and charge a ‘”carbon levy”‘ for all emissions that are more than 85 percent of 2002 levels. No airline is going to eat that cost, so you’ll get the bill, perhaps listed as an ‘”environmental surcharge.”‘

Even though some analysts are predicting a steep decline in airline profits next year, American carriers expect that the EU’s carbon plan would cost them more than $3 billion over eight years. Up until this point, Europeans have been content to go it alone with their climate taxes, thinking this will somehow serve to save the world. But now, Europe is seeking to force this mentality on other corners of the globe. These taxes are indeed costly, and even within Europe, their implementation is not gratefully accepted by all. In the UK, the Financial Times reports that there are concerns that the government is “in retreat from its green agenda.”

Noting that the EU’s Climate Action and Renewable Energy Package will cost the UK economy an exorbitant £ 20.2 billion by 2020, Open Europe, an independent European think tank, argues that the EU could find a much more cost-effective way to address climate initiatives. It argues that a much more effective and righteous approach would be for the EU to set overall carbon emission targets and then allow for individual member states to decide how best to reach them. At least in this approach, the EU would not be imposing direct government regulation on its members.

Within the issue of climate taxes within the EU, and their proposed extension into the United States, it is important to note the role that the government should and should not play. The main role of government should be to promote the common good, that is, to maintain the rule of law, and to preserve basic duties and rights. Free actions should not be overtaken by the government. The principle of subsidiarity is violated when governments over reach, usurping the ability of perfectly capable human beings, by way of the market, to operate effectively. The EU’s climate regulations on member states are indeed dubious, but it is particularly egregious when these regulations are allowed to extend to other countries.

Amid the hustle and bustle of preparing for tonight’s Acton Institute annual dinner, I’m trying to carve out some time to make final preparations for my participation in the 9th Annual Christian Scholars’ Symposium hosted by the Christian Legal Society. Tomorrow afternoon I’ll be debating with Gideon Strauss of the Center for Public Justice on the question, “Justice, Poverty, Politics & the State: Is There a Christian Perspective?”

One of the pressing issues related to the size and scope of government is the complex nature of today’s tax system, particularly at the federal level. Regardless of what you think of Herman Cain’s “9-9-9″ tax plan, Arthur Laffer’s opening observations in a WSJ op-ed yesterday summarize well where we find ourselves:

It used to be that the sole purpose of the tax code was to raise the necessary funds to run government. But in today’s world the tax mandate has many more facets. These include income redistribution, encouraging favored industries, and discouraging unfavorable behavior.

To make matters worse there are millions and millions of taxpayers who are highly motivated to reduce their tax liabilities. And, as those taxpayers finagle and connive to find ways around the tax code, government responds by propagating new rules, new interpretations of the code, and new taxes in a never-ending chase. In the process, we create ever-more arcane tax codes that do a poor job of achieving any of their mandates.

Gideon was kind enough to ask me to contribute to CPJ’s Capital Commentary a few months back on the question of getting back to first principles with respect to the tax code. And in that piece, “Back Door Social Engineering,” I made the following case, taking my own point of departure with another quote from Laffer:

A return to a first-principles discussion of taxation in America requires a return to the fundamental purposes of taxation. Notwithstanding the current size of the federal tax code, the fundamental purpose of government taxation is not to encourage or discourage particular behaviors. The point of taxation is to raise funds to enable the government to fulfill its moral, political, and social responsibilities. It is true, as economist Arthur Laffer has made famous, that “when you tax something you get less of it, and when you reward something you get more of it.” But this reality, which takes into account how people respond to incentives, is secondary to the basic function of taxation.

It is immoral for a government to chronically run up deficits and lack the willpower to actually raise the funds it needs to do what it sets before itself. Michael Munger put it well: “Deficits are future taxes.” Quite apart from the question of what the government ought to be doing is the issue of paying for what it actually does, and our government has failed miserably on that latter point.