All Eyes on Virginia

Election Day (surely a misnomer with early voting)  is this Tuesday and all eyes are on Virginia’s gubernatorial race. As they should be. The contest, between Democrat Terry McAuliffe and Republican Glenn Youngkin, may help to clarify two important political questions and one structural question. 

Terry McAuliffe

First, can the Republican Party move beyond its embrace of Donald J. Trump and thrive as a modern organizing vehicle for conservative fusionism? Second, can the Democratic Party abandon progressivism and return to pragmatic liberalism? Third, and most important, will policymaking continue to be dominated by bureaucratic rule-making, or will it allow for increased freedom of choice?

First, the political questions. When the race began, McAuliffe was considered to be a shoo-in. Over the last 10 years or so Virginia migrated from being reliably red to purple with a decided blue tinge. Since 2002 Virginia, which does not permit its governors to serve consecutive terms, has had 5 Chief Executives, 4 of whom were Democrats. The current Governor, who survived a black-face scandal, is a liberal Democrat. The two legislative bodies flipped from Republican to Democratic in 2019 for the first time since 1994. President Biden won the state by 10 points in 2020. 

Glenn Youngkin

Needless to say, candidate McAuliffe is running hard against—Donald Trump—who in Virginia is only slightly more popular than the Unabomber. Not a day goes by where McAuliffe doesn’t rail against Trump and then argue that Republican Youngkin is simply a Trump acolyte. 

For his part, Youngkin has carefully tried to thread the needle. He needs Trump voters, but he also needs to create space between himself and Trump in order to win back upscale suburban voters who abandoned Republicans in droves in 2018 and 2020. Consequently he has focused on state and local issues with occasional rhetorical shots at the lunatic fringe that increasingly dominates the national Democratic Party. 

In this he has been greatly helped by none other than the Democratic candidate, Terry McAuliffe. In answering a question about local schools—a topic that has generated considerable heat in Virginia (and elsewhere)—McAuliffe voiced an opinion that stunned a lot of political observers. He said “I don’t think parents should be telling schools what they should teach.”

This remark added fuel to the fire that had already been raging for months over the public schools in Northern Virginia. There have been contentious school board hearings, petitions and recalls in the counties surrounding Washington DC over school curricula, admission standards for magnet schools, Critical Race Theory, masking of school children and school closings due to COVID-19.   

Bear in mind a couple of relevant facts. The first thing to note is that the four Virginia counties surrounding the District are among the wealthiest, best educated and bluest in the country. They are prime territory for Democratic vote seekers. And those counties appear to be in revolt. The second is that parents began to realize what has been going on in the public schools when they looked at their children’s Zoom screens and saw how their children were being proselytized. And the parents didn’t like it one bit. 

A third factor that needs to be taken into account is that McAuliffe is just plain wrong when it comes to parental rights with respect to the education of their children. The Code of Virginia is quite clear about this. The Code §1—240.1 entitled Rights of Parents reads as follows:

“A parent has a fundamental right to make decisions concerning the upbringing, education and care of the parent’s child.”

All of which points to the central element of the race. Candidate Glenn Youngkin says “I believe parents should be in charge of their kids’ education.” Candidate McAuliffe says that he thinks parents should keep out of it and let the professionals—i.e., the teachers unions—run the show. This despite the fact that the law of the Commonwealth, quoted above, is quite clear that the decision-making authority over a child’s education fundamentally resides with the parents. And, not to put too fine a point on it, progressives have made hash out of pretty much everything they have run. 

Government by experts rather than the protection of rights has been the battle cry of progressives from the time of Woodrow Wilson until the present day. This inevitably makes government an interested rather than a neutral party in the application of the law. Which in turn ultimately brings about the destruction of Liberalism, the rule of law, and liberty, only to be replaced by the soft (and later not-so-soft) authoritarianism of bureaucratic command-and-control.  

The choice in Virginia’s gubernatorial race is clear. On the one hand there is Youngkin, who represents the messy business of  democratic governance designed to protect rights and expand the range of citizen choice. On the other hand there is McAuliffe, the iron fist in the velvet glove, who represents the bureaucratic interests of government at the expense of citizen choice.   

When the votes are counted on election day, mine will be among those for Glenn Youngkin. 


Janet Yellin Scores a D Minus

Ignorance and enthusiasm make a dangerous combination. It’s even worse when people who should know better nevertheless agree to make wildly implausible sales pitches designed to justify foolish policy proposals. In the end a once respectable reputation gets dented and maybe shattered. 

Enter Janet Yellin, PhD. Ms Yellin earned her undergraduate degree in economics at Brown University; she earned her MA and PhD degrees in economics from Yale University. Before serving as Chair of the Fed, and then as Treasury Secretary, she worked as a professor at UC Berkeley, one of the nation’s top schools. 

Janet Yellin

At Berkeley she had a joint appointment at the Haas School of Business and the Economics Department. She was the second woman at Berkeley to receive tenure (1982) and the rank of full professor (1985).  She has also served as a member of the National Science Foundation’s panel in economics and as a fellow at the Brookings Institution. 

And yet, in promoting the Biden Administration’s “Build Back Better” proposal she came up with this doozy:

“It will boost the economy’s potential to grow, the economy’s supply potential, which tends to push inflation down, not up,” she said. “For many American families experiencing inflation, seeing the prices of gas and other things that they buy rise, what this package will do is lower some of the most important costs, what they pay for health care, for child care. It’s anti-inflationary in that sense as well.”

Let’s unpack this remarkable series of assertions, provided without evidence, as the Washington Post used to say (correctly) about Trumpian policy claims. First: the Biden package will “boost the economy’s potential to grow…which tends to push inflation down”. Second, the package will subsidize consumption of health care and child care, which she claims is anti-inflationary in that it reduces consumer costs.

I would be willing to bet that a student at Berkeley who made those preposterous arguments in a class taught by Professor Yellin would earn a solid D-. Consider: The entire thrust of the Biden proposal is to raise the tax burden on the most productive people in the country in order to stimulate consumption by the least productive segment of the population.  

After all, raising taxes on high income earners reduces the savings pool and therefore investment. That reduces the potential supply of goods and services. Moreover, even if it were true (which it manifestly is not) that the supply of goods and services would be increased by the plan, that eventuality is years down the road. The inflation problem is here now.  

Let’s take a look at the demand side. How in the world does subsidizing the consumption of child care and health care services  bring down costs for those services? If I subsidize Mary thus lowering her costs, I have to charge somebody else thereby raising those costs. All else equal, I have not lowered costs, I have merely shifted them. Consequently prices will not accurately reflect production costs and capital will be misallocated. Capital  misallocation reduces efficiency; as a result prices tend to be higher than they would otherwise be.

Leaving aside theory, there is history here. When the Affordable Care Act (ObamaCare) was passed in 2010, the average employer cost for family health insurance coverage was $9,773. By 2020 it had risen to $15,754; an increase of more than 60%. Average insurance costs per worker rose from $3,997 to $5,558; an increase of just under 40%. According to Kaiser Permanente, as of July 2020 the average cost for health care insurance is $21,342. About 75% of that is paid for by the employer, which is another way of saying that the worker’s cash wages are reduced by that amount. 

Some statistics on health care costs can be found here, here and here.

To be fair, there is still a vigorous debate over the true impact of ObamaCare on insurance premiums. Some premiums went up, some went down—after accounting for subsidies. Actually the system is not really insurance at all. Instead it is an after-the-fact payment system coupled with income transfers and increased taxes.  That said, ObamaCare was marketed as a way to reduce premiums, and that  it did not do by any stretch of imagination. 

So there is no reason for anybody to take seriously Ms. Yellin’s assertion that throwing more federal subsidies at health care will lower costs. It will just redistribute them, and probably in an inefficient way. 

Similarly, subsidizing child care will not lower costs, it will simply transfer those costs. There is no reason to suppose that federal subsidies for baby sitters (which is what we are really talking about here) will increase economic productivity, much less reduce inflation. 

Ms. Yellin certainly knows that what she is arguing is transparent nonsense. She is probably just repeating talking points dreamed up by some communications flak in the White House.  But she is doing President Biden no favors. The country and Mr Biden would actually be much better off if she were to talk some sense into him. But that, unfortunately, does not look like it’s going to happen. Apparently it is Bernie Sanders and Elizabeth Warren et. al. who have the President’s ear.


Prosecute Steve Bannon

Congress recently voted (229—202) to hold sometime Trump whisperer Steve Bannon in criminal contempt for defying a subpoena to testify in the Congressional investigation of the January 6 riot. In refusing to comply, Mr. Bannon asserted executive privilege. All but 9 Republicans voted against holding him in criminal contempt. 

Steve Bannon

It is certainly true that partisan motives were behind at least some of the votes in favor. And it is also true that members of both parties have ignored Congressional subpoenas in recent years without penalty. The Department of Justice has repeatedly declined to prosecute criminal referrals for contempt of Congress. 

Making things worse, Congress has studiously ignored dealing forcefully with officials who lied under oath at Committee hearings. James Clapper, former Director of National Intelligence, and James Brennan, former CIA Director come to mind. Then there are lesser figures like Lois Lerner whom the Justice Department refused to prosecute after a criminal referral. 

In the case of Steve Bannon we have an open and shut case of criminal contempt. Bannon argues, along with former President Trump, that he is covered by executive privilege. That argument is without merit. Bannon came and went as a member of the administration long before the events of January 6, 2021, the subject of the subpoena. His conversations with Trump during the time he was a civilian are simply not covered by executive privilege. And pretty much everyone knows it, including the invertebrate Republicans who voted against issuing the contempt citation. 

If Bannon is not held to account for his willful refusal to comply with a lawful subpoena, the power of Congress to hold the executive branch to account will be diminished even further than it already is. It would be nice to think that more than 9 of 211 Republicans would be capable of figuring that out, but apparently they suffer from the paralyzing fear that Donald Trump will belch forth disapproval of them for not being sufficiently obsequious.

Mr. Bannon may invoke his 5th amendment right against self-incrimination. Should he decide to do so Congress could be faced with the interesting issue of whether to grant him some sort of immunity in order to compel his testimony. 

It should also be noted that there is a jail cell in the Capitol building where Congress could legally order Mr. Bannon be held until he testifies before the House committee. In the event that Mr. Bannon continues to defy the subpoena and Justice declines to prosecute, that would be a fitting solution to Bannon’s ongoing defiance of a legal order. 


Clashing Philosophies

Around 30 years ago William F Buckley and his friend Professor Milton Friedman debated Buckley’s proposal that some kind of National Service be required of young people. Buckley, who along with Dr. Friedman famously championed the free market, insisted that the National Service be voluntary and non-military. On the other hand, Friedman maintained that the proposed National Service would not really be voluntary; that it would be captured by political interests as is typical of government programs and that it would fail to meet its objectives, also typical of government programs. 

Micheal Kinsley, then editor of the New Republic, served as the debate moderator. The half hour debate, which is well worth watching, can be seen by clicking on the Buckley Friedman Debate link below. 

The Video Can be seen on You Tube at the link below:

Buckley Friedman Debate


The Eviction Non-Crisis

Ever notice that progressives have a habit of manufacturing a “crisis” when they have a policy goal in mind, but somehow manage to ignore real crises they’d rather not talk about. Consider the eviction “crisis”. 

In August of 2020 the Aspen Institute published a paper that claimed 30-40 million Americans are “at risk” of eviction in the next several months. One year and 2 months later those 30 – 40 million potential evictees failed to materialize. By September of 2021—a year after the Aspen paper—the New York Times reported that the Supreme Court’s decision to strike down the national moratorium on evictions placed “…at least 2 million renters in immediate danger of eviction…”. Students of arithmetic will note that is somewhere between 28 and 38 million fewer than the Aspen paper. 

Not that the Aspen paper was an outlier in its general thrust. The Biden Justice Department weighed in by explaining how State Courts could prevent a “looming crisis” asserting that 6 million Americans were behind on their rent. Similarly, the American Prospect published an article in August of 2021 asserting that “The Eviction Crisis is a Rental Assistance Crisis”. It went on to assert that “a law designed not to work has put millions at risk of losing their homes”. 

Except that the projected surge in evictions just didn’t happen. As Reason Magazine reports, a month after the end of the federal eviction moratorium eviction filings were up, but nowhere near the projected Tsunami. For instance, Princeton University’s Eviction Lab found an 8.75% increase in filings from August to September, but relative to historic averages, eviction filings in September were estimated to be 48.5% below historic averages.  

There are different explanations for this. Among them, state governments stepped in to help; landlords continued to cut tenants slack, and state and local governments finally got around to distributing the $46 billion in federal rent relief funds that they have. Regardless, the fist pounding and hysteria was unwarranted.

On the other hand we have accumulated debt of around $28 trillion that progressives would prefer not to talk about. And the main driver for all the accumulated debt is entitlement spending, which the Democratic Party is determined to increase by substantial amounts. The Social Security program is already insolvent; Medicare is due to run out of money in the mid 2030s, and Medicaid runs out in 2026. 

Those pesky little facts will not be part of a great “national conversation”. Nor will there be a “search for solutions” for the simple reason that there is no solution. There is not now, nor will there ever be enough money to cover the utopian fantasies of the left. The only question is how much the clean up costs will be when the music stops. 


Enough Already

On a daily basis it seems that the Biden White House launches a new round of absurdities. Consider that they keep on insisting that they have enough votes to suspend the debt ceiling to avoid a default, but the whole thing is really Mitch McConnell’s fault. Or that in the past the Congress routinely voted to increase the debt ceiling on a bipartisan basis. Except that they didn’t. In fact, in 2006 when the government was in Republican hands, every single Democratic Senator voted against raising the debt ceiling. One of the leaders of that exercise in bipartisanship was none other than Joe Biden when he was Senator from Delaware. 

Then there is the botched pull-out from Afghanistan. The Biden Administration is busy hailing it as a great success even though it is beyond dispute that American citizens and green card holders were left behind. Not to mention the airport bombing that killed 13 American soldiers and over 100 Afghans. Or the drone attack in the middle of Kabul that mistakenly targeted civilians thereby killing as many as 10 Afghan children.  

The Afghan debacle, predictably enough, included President Biden’s attempt to evade responsibility by claiming that he was following the unanimous counsel of his top military advisers.  Except that he wasn’t, as subsequent testimony made it clear that some advised the President to leave 2,500 troops in place.  

And then there is the ongoing budget negotiation fiasco. Shortly after a bipartisan infrastructure deal was reached, Biden turned around and linked passage of the infrastructure deal to his $3.5 trillion middle class welfare bill. Incredibly enough, Biden and his team are claiming that the cost of this extravaganza is — wait for it —zero. 

The rationale is that the bill is “paid for” and therefore costless. That is the equivalent of saying that if I go out and buy a $250,000 Ferrari and pay for it with cash, it costs me nothing. But if I buy it with a credit card the cost is $250,000. Same car; same price but one is “free”.  The mind reels.

Almost every day the White House belches out a similar absurdity mixed liberally with mendacity. And from the polling data, it seems that the public is getting more than a little tired of it. Last November the body politic expressed its displeasure with routine displays of incompetence and dishonesty. You would think the Biden team would have gotten the message. Apparently not. 


The Debt Ceiling, Again…

Of course Congress should raise the debt ceiling and avoid a default. And of course throughout history the parties have been absolutely hypocritical about when they will and when they will not vote to do so. The chief criteria are twofold: (1) what is the best way to embarrass the other side and (2) gain electoral advantage in the process?

Today we have (nominally) unified government under Democratic control. Naturally enough, the Republicans are refusing to cooperate in raising the debt ceiling on a bipartisan basis. Also naturally enough, the Democrats are pretending to be hopping mad about the Republicans’ bad faith in refusing to cooperate in what is normally a bipartisan effort.

Except that the Democrats’ claim about historic bipartisanship is simply not correct. As recently as 2006 when the federal government was controlled by Republicans, not a single Democratic Senator voted to increase the debt limit–led by among others — wait for it — then Senator Joe Biden.

Below, see the speech minority leader Mitch McConnell (R, KY) made today, quoting then Senator Biden, on the subject. It is fairly amusing. Especially since it is a given that in the not too distant future a Democratic Senator will be quoting Senator McConnell when the roles of the parties are reversed.