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April 9, 2012
Latest Studies
45 new items, including a Competitive Enterprise Institute study on homesteading, and the Hudson Institute’s Index of Global Philanthropy
Blog Entries
Judicial Review not so new, global warming on hold, U.S. now has highest corporate tax rate in the world, and more
Budget & Taxation
• The Paradox of “Taxing the Rich” – Economics 21
• Highway Bill’s Pension Language Makes Taxpayer Bailout of PBGC More Likely – The Heritage Foundation
• Taxmageddon: Massive Tax Increase Coming in 2013 – The Heritage Foundation
• The Consumed Income Tax: Efficient and Fair Tax Reform for North Carolina – John Locke Foundation
• How Tax Expenditures Hurt the Economy—and What to Do About It – Manhattan Institute
• Lottery Tax Rates Vary Greatly By State – Tax Foundation
• Tax Freedom Day 2012 – Tax Foundation
• The Countdown is Over. We’re #1 – Tax Foundation
Economic Growth
• Homesteading the Final Frontier – Competitive Enterprise Institute
Education
• Completion Matters: The High Cost of Low Community College Graduation Rates – American Enterprise Institute
• Regional Education Service Centers: A Question of Necessity – Texas Public Policy Foundation
• School Finance: Increasing Efficiency through Personnel Management – Texas Public Policy Foundation
Foreign Policy/International Affairs
• A New Agenda for American Leadership at the Sixth Summit of the Americas – The Heritage Foundation
• ICC Prosecutor Makes Right Call on Palestinian Declaration, but Grave Concerns Remain – The Heritage Foundation
• The History of the Bloated U.N. Budget: How the U.S. Can Rein It In – The Heritage Foundation
• U.S.–Brazil Summit Must Address Differences on Democracy, Human Rights, and Iran – The Heritage Foundation
• A Still-Strong Alliance – Hoover Institution
• Authoritarian Capitalism Versus Democracy – Hoover Institution
• Deciding to Be Mars – Hoover Institution
• I’ll Gladly Pay You Tuesday – Hoover Institution
• Reaffirming Transatlantic Unity – Hoover Institution
• Russian Power, Russian Weakness – Hoover Institution
• The Power of Economics and Public Opinion – Hoover Institution
• The West Runs Out of Power – Hoover Institution
• Will Europe Arrest Its Strategic Fade? – Hoover Institution
Government Reform
• Why Congress Must Confront the Administrative State – The Heritage Foundation
Health Care
• Phake: The Deadly World of Falsified and Substandard Medicines – American Enterprise Institute
• Saving the American Dream: Comparing Medicare Reform Plans – The Heritage Foundation
• Skin in the Game: Governor Brown is Right and Secretary Sebelius Is Wrong About Medicaid Co-Pays – Pacific Research Institute
Immigration
• Holiday on ICE: The U.S. Department of Homeland Security’s New Immigration Detention Standard – Center for Immigration Studies
Information Technology
• The Battle for the Postal Service: Postal Unions Go Postal – Capital Research Center
• 4G Wireless Networks Need Relief from Cell Siting Barriers – Free State Foundation
• Any New Privacy Regime Should Mean an End to FCC Privacy Powers – Free State Foundation
Monetary Policy/Financial Regulation
• Paying Bank Examiners for Performance – Cato Institute
National Security
• CTBT: New Study Fails to Resolve Differences over Risks to U.S. Nuclear Arsenal – The Heritage Foundation
• How the Pentagon Can Be Best Buy – The Heritage Foundation
Natural Resources, Energy, Environment, & Science
• Renewable Energy Subsidies Should Be Abandoned – American Enterprise Institute
• Using the Free Market to Move Environmental Policy from Eco-Fads to Science – Washington Policy Center
Philanthropy
• 2012 Index of Global Philanthropy and Remittances – Hudson Institute
Regulation & Deregulation
• Market Structure and Competition in the US Food Industries – American Enterprise Institute
• Occupational Licensing Regulation in Texas – Texas Public Policy Foundation
The Constitution/Civil Liberties
• Justice Kennedy’s Million Dollar Question – Hoover Institution
• South Africa’s Orwellian Constitution – Hoover Institution
• Beyond Congress’s Power to Tax: Constitutional Questions Surrounding the Health Care Law’s Individual Mandate – Tax Foundation
Transportation/Infrastructure
• A Plea for Beauty: A Manifesto for a New Urbanism – American Enterprise Institute
• Why the House Should Give States Greater Tolling Flexibility – Reason Foundation
U.S. Now Number One in Corporate Taxes
The United States now has the highest corporate tax rate in the world. Japan previously had the highest rate, but on April 1 it lowered it’s rate to 36.8 percent, leaving the U.S. effective rate of 39.2 percent the highest in the world.
“This gaping disparity,” explains The Heritage Foundation’s Curtis Dubay (The Foundry, March 30),
… means every other country that we compete with for new investment is better situated to land that new investment and the jobs that come with it, because the after-tax return from that investment promises to be higher in those lower-taxed nations.
Our high rate also makes our businesses prime targets for takeovers by businesses headquartered in foreign countries, because their worldwide profits are no longer subject to the highest-in-the-world U.S. corporate tax rate. Until Congress cuts the rate, more and more iconic U.S. businesses such as Anheuser-Busch will be bought by their foreign competitors.
Tax Freedom Day Falls to April 17
“Tax Freedom Day® 2012 arrives on April 17 this year, four days later than last year due to higher federal income and corporate tax collections,” says the Tax Foundation:
That means Americans will work 107 days into the year, from January 1 to April 17, to earn enough money to pay this year’s combined 29.2% federal, state, and local tax bill.
If the federal government raised taxes enough to close the budget deficit—an additional $1.014 trillion—Tax Freedom Day would come on May 14 instead of April 17. That’s an additional 27 days of government spending paid for by borrowing.
To Do: Read Some Pro-Liberty Fiction
• Stock up on pro-freedom science fiction. Among this year’s finalists for the 2012 Prometheus Award for best libertarian science fiction: The Children of the Sky by Vernor Vinge, The Freedom Maze by Delia Sherman, In the Shadow of Ares by Thomas L. James and Carl C. Carlsson, Ready Player One by Ernest Cline, The Restoration Game by Ken MacLeod, and Snuff by Terry Pratchett. The Libertarian Futurist Society will announce the winner of the Prometheus Award at the 70th World Science Fiction Convention in Chicago over Labor Day weekend.
• Learn more about Obamacare’s assault on religious liberty. On Tuesday, Paul Rahe will speak at Hillsdale College’s Kirby Center. The talk is officially part of its First Principles on First Fridays program, held this time on Tuesday because April’s First Friday is also Good Friday.
• Get on the Values Bus. Next week it’s in Ohio: Monday, Steubenville; Tuesday, Columbus; Wednesday, Cincinnati and Fairfield; Thursday, Warren and Butler Counties, and Dayton; Friday, Findlay; Saturday, Toledo; Sunday, Westlake and Cuyahoga Falls. More details at ValuesBus.com.
• Register for Resource Bank and the Atlas Experience (if you haven’t already). The tandem meetings will be held in Colorado Springs beginning April 24. Each will be a great opportunity to meet allies in the conservative/classical liberal movement.
There’s been no global warming in the past 15 years, says the Global Warming Policy Foundation (April 2), which analyzed the latest data released by the U.K. Meteorological office.
The findings, explain the Foundation’s David Whitehouse, suggest that climate scientists still have not developed an accurate model of how the Earth’s climate works:
In 2001 and 2007 the Intergovernmental Panel on Climate Change (IPCC) (and here) estimated that the world would warm at a rate of 0.2 deg C per decade in the future due to greenhouse gas forcing. Since those predictions were made it has become clear that the world has not been warming at that rate. Some scientists retrospectively revised their forecasts saying that the 0.2 deg C figure is an average one. Larger or smaller rates of warming are possible as short-term variations.
Global warming simulations, some carried out by the UK Met Office (here, here and here), have been able to reproduce “standstills” in global warming of a decade or so while still maintaining the long-term 0.2 deg C per decade average. These decadal standstills occur about once every eight decades. However, such climate simulations have not been able to reproduce a 15-year standstill.
Mandates Are Not the Solution to Our Problems, They Are the Problem
As the Supreme Court ponders the constitutionality of ObamaCare’s individual mandate, Remy reminds us that it was state mandates that helped make insurance expensive in the first place:
Canada is eliminating its penny, which costs 1.6 cents just to make, and according to David Owen (New York Times, April 4) the United States should follow suit:
Pennies have virtually no buying power, yet they cost a lot to make, distribute and use, and many consumers simply throw them away. (Picking up a penny from a sidewalk and putting it in your pocket pays less than the Federal minimum wage, if you take more than 4.9 seconds to do it.) The U.S. Army stopped using pennies on its bases in Europe in 1980, to spare itself the cost of shipping them overseas. In 1996, the Government Accounting Office determined that most of the millions of shiny new pennies that leave the U. S. Mint each year simply disappear. What’s the point?
A quarter today has less buying power than a U.S. penny did in 1940.
Canada isn’t the only country to eliminate its least valuable coinage. New Zealand stopped making one-cent and two-cent coins in 1989, and it got rid of five-cent coins in 2006. (It also replaced one-dollar and two-dollar bills with coins in 1991, and shrunk its twenty-cent and fifty-cent coins, which had been hubcap size, in 2006.) This may sound un-American, but it isn’t. The United States abandoned its own most worthless coin, the half-cent, in 1857, when a half-cent was worth more than a dime is today.
By most measures, a quarter today has less buying power than a U.S. penny did in 1940. That means that consumers in 1940 got by without the equivalent of almost all the pocket change we now lug around.
Now They Want Deference from the Supreme Court
Didn’t it seem like Congress wanted to defer to the Supreme Court when it passed ObamaCare? Remember these greatest hits, as rounded up by David Bernstein (Volokh Conspiracy, March 28)?
Rep. Conyers cited the “Good and Welfare Clause” as the source of Congress’s authority [there is no such clause].
Rep. Stark responded, “the federal government can do most anything in this country.”
Rep. Clyburn replied, “There’s nothing in the Constitution that says the federal government has anything to do with most of the stuff we do. How about [you] show me where in the Constitution it prohibits the federal government from doing this?”
Rep. Hare said “I don’t worry about the Constitution on this, to be honest [...] It doesn’t matter to me.” When asked, “Where in the Constitution does it give you the authority …?” He replied, “I don’t know.”
Sen. Akaka said he “not aware” of which Constitutional provision authorizes the healthcare bill.
Sen. Leahy added, “We have plenty of authority. Are you saying there’s no authority?”
Sen. Landrieu told a questioner, “I’ll leave that up to the constitutional lawyers on our staff.”
And of course, Rep. Nancy Pelosi said “Are you serious? Are you serious?” when asked what part of the Constitution gives Congress the authority to enact ObamaCare.
Judicial Review Not Such a New Innovation in American Government
No, the Supreme Court did not invent judicial review just last week when it heard arguments on Obamacare. On Monday, President Obama said: “Ultimately, I’m confident that the Supreme Court will not take what would be an unprecedented, extraordinary step of overturning a law that was passed by a strong majority of a democratically elected Congress.”
Judicial review is not mentioned in the Constitution, but it was anticipated by the Founders. In 1788, Alexander Hamilton explained in Federalist 78:
The complete independence of the courts of justice is peculiarly essential in a limited Constitution. By a limited Constitution, I understand one which contains certain specified exceptions to the legislative authority; such, for instance, as that it shall pass no bills of attainder, no ex post facto laws, and the like. Limitations of this kind can be preserved in practice no other way than through the medium of courts of justice, whose duty it must be to declare all acts contrary to the manifest tenor of the Constitution void.
In 1796, the Supreme Court first exercised judicial review of a federal law when it upheld a carriage tax against the claim that it violated the Constitution’s provisions on direct taxation (Hylton v. United States).
In 1803, the Supreme Court ruled that Section 13 of the Judiciary Act of 1789 was unconstitutional because it redefined the original jurisdiction of the Supreme Court, which is set out in Article III of the Constitution. The case, Marbury v. Madison, was the first time the Court ruled a federal law unconstitutional.
To date, the Supreme Court has ruled 165 acts of Congress unconstitutional. (For a list, see page 2119 of the U.S. Senate Publication, “The Constitution of the United States of America, Analysis and Interpretation,” published in 2002 and page 199 of the 2010 Supplement.)
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