The Gloves Are Off

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Last week’s bipartisan budget deal was more than a ceasefire in the fiscal war between Republicans and Democrats. It also led to the first shot being fired in the long-awaited, long-postponed civil war within the Republican Party.

Emboldened by recent Tea Party defeats in special elections held in Alabama and Louisiana, and by polling data showing that the October shutdown of the federal government was deeply unpopular with voters, House Speaker John Boehner used the budget agreement as a pretext to come out swinging against the Tea Party wing of his party.

According to sources who spoke to The New York Times and other media outlets, in a meeting of House Republicans held on Dec. 11 Boehner castigated advocacy groups like Heritage Action for America and the Senate Conservatives Fund: “They are not fighting for conservative principles. They are not fighting for conservative policy. They are fighting to expand their lists, raise more money and grow their organizations.” These accusations in private were followed by Boehner’s public denunciation of the same groups for opposing the deal worked out between House Budget Committee chairman Paul Ryan and his Democrat counterpart in the Senate, Patty Murray of Washington. “I just think they’ve lost all credibility,” he said of the groups at a press briefing on Dec. 12. Implicitly of course Boehner was also criticizing the Tea Party supporters in his own caucus, as well as Ted Cruz and Co. over in the Senate. The smell of blood is in the air; the establishment’s fight to take back the GOP has begun in earnest.

At the same time the Speaker was attacking the far right, the executive director of the House Republican Study Committee, Paul Teller, was fired for leaking the content of private conversations to conservatives opposed to the party establishment. The dismissal amounts to a first step to wrest control of the Republican agenda from those sympathetic to the Tea Party and place it firmly in establishment hands.

So far the Tea Party and affiliated groups have responded with rhetoric only. It is difficult to see what they can actually do to hurt the establishment without damaging their own cause. They remain a minority — albeit an important one — within a minority, and as such can only go so far without committing political seppuku. It may very well be, however, that they will prefer to die “honorably” rather than compromise with the establishment. True believers rarely yield. How fanatical the Tea Partiers truly are will become clear over the next year or two.

The establishment is seeking to control the agenda and put forward candidates who will enable the Republicans to hold the House and win the Senate in 2014. It also wants to smooth the path for an establishment candidate (Scott Walker, or Jeb Bush, or perhaps Paul Ryan, who declared himself for the establishment when he put his name on last week’s budget deal) to gain their party’s nomination for president in 2016.

At the moment the tide is running with Boehner and the establishment. But the establishment’s ability to impose its vision upon the GOP is yet to be demonstrated. November’s special election in Louisiana, for example, was by no means a clear-cut establishment victory. And it is far from certain that the establishment, even if it triumphs in the intramural battle with the Tea Party, can win a majority of the electorate for its agenda. Demographic trends will continue to shrink the Republican vote, despite efforts by Republican-controlled state legislatures to suppress Democrat turnout. The recent decline in the Democratic brand has been caused by the disastrous rollout of Obamacare; there is no indication that it represents a secular trend.

In any case, the battle between Republicans has been truly joined, and it should be fun to watch. Pass the popcorn, please.




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A Letter to a Cousin in France

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My dear cousin Gérard,

Thank you for giving me news from the old country. Congratulations on your acquittal! To whom do you owe the favor of the court's providential misplacing of these evidence files? Wait, on second thought, don't answer that question.

As for me, I have been totally aboveboard since I immigrated to the United States. As you remember, I left our profitable little organization because I was sick and tired of helping politicians pluck the country like a gullible goose. I wanted to leave behind the dirtiness, the lies, the posing.

I came to the US with some reverence, and, dare I say, a bit of awe. Yes, laugh me up. Nevertheless, you have to admit that the US was founded on principle and deeds quite above the bloody chaos that gave birth to many European republics. Take France, where people still think so highly of themselves in spite of abundant evidence to the contrary. Its line of absolutist kings was toppled by a demented slaughter calling itself a revolution, which gave birth to an emperor, more kings, another emperor, and a series of unsteady, depraved governments. Compare the rabid, bloodthirsty revolutionaries of Paris with the thinkers who authored the Federalist Papers — look it up online. It's obvious that the depth of thought that went into America's founding principles has few equivalents in Europe.

Not that we didn't have our moments of fun back in the old country. Remember when that guy wanted to found an anti-corruption opposition party? How we were called to handle it? I supervised the state's "security interventions" to cut power to the buildings the guy rented for his conventions, and you manufactured the rioting protests that destroyed the cars of the attendees while the national police watched. After a few weeks, nobody dared to attend the guy’s speeches. Good times, good times. And well-paid, too.

But it was becoming as painful as watching a pit bull ripping a kitten to shreds — over and over again. So I left home. I left the grime, the dishonesty, the corruption, and I started an honest business in this still mostly honest country. All these years, you told me, "You just wait." I didn't want to believe you.

But you were right, damn your cynical hide.

You probably have not heard of it — hell, even the American media barely mentioned it. But it started. The rot is taking hold. We — the USA, I mean — are becoming just like the old country.

It always starts when politicians get government employees to persecute their opponents. I'm not talking about finding dirt on the challenger in an election No, I'm talking about using the tax system to harass and suppress political opponents. I know, this is old news in France or Italy, but here, it was unheard of.

Yet that's exactly what Obama's IRS just did. The Federal tax administration singled out constitutional-government organizations and used tactics that I'm sure you'll find interesting: intimidation, extreme indiscretion, dereliction of duty, abnormal delays, and plain harassment. For example, the IRS (that’s what the tax outfit is called) was asking Tea Party chapters to provide the full biographies of all the officer's family members, their plans, their income past, present, and future, the works! They also wanted the news clippings that mentioned them, information about future meetings during the next two years, financial information on officers and their families. Better, they planned to make all that information publicly available! This, in a country where a Social Security number is enough to open a line of credit. And this abuse went on for years.

It’s so gross that even the leftist MSNBC television channel mentioned it. To give you context, this is a channel on which anchors interviewing leftists ask for their autographs. On the air.

Of course, the IRS pretends that this is all a regrettable mistake made by lowly clerks at a single IRS center in Cincinnati, that it was nothing political. That's a lie, obviously: discrimination against opponents was dished out by several IRS offices. And the IRS announced that there will not be a single slap on the wrist to punish this unbelievable abuse, which confirms that it was an operation led from the top.

This shattered my illusions about this country, and with them, my hopes for a republic as a form of government that could succeed somewhere. Yes, Gérard, I am naive. I am glad I am telling you this in writing. It will save me the trouble of slapping that annoying smirk off your face.

Which brings me to a business proposal. Obviously, the US is ripe for the next step. They have these amateurs in the Chicago "machine" that do more or less the same job as you, but lack the polish, the experience that you can bring to your operations. Why don't you open your "political consultancy cabinet" here? I'll help you, as I did in the past, for the same percentage. You will find it appetizing: a country of 300 million wide-eyed yokels, most of whom still believe what the media tell them.

Oh, and don't bother with a work visa. I heard they're going to have a big amnesty anyway.

Reluctantly yours,
Cousin Jacques




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The Tea Party House Roller Coaster

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So Speaker Boehner decided that the danger of the fiscal cliff destroying the economy was a graver risk than letting Obama and the Democrats collapse America into a statist nightmare of never-ending deficit spending and ever-higher taxes. Tea Party darlings Paul Ryan and Grover Norquist both supported the fiscal cliff deal, and they had some legitimate arguments: taxes were permanently lowered for most Americans, taxes went up only on the rich, and the Tea Party House can use the automatic sequestration, in March, and the coming debt ceiling showdown in February, as leverage to extract spending cuts from the Democrat-controlled Senate and Obama.

But what does it all mean? I think there is no reason why the showdowns to come later this year will be any different from the fiscal cliff, New Year's Day drama. We are headed for a hellish roller coaster ride on which we face dangerous, potentially disastrous duels between the president and the Tea Party House over whether America is headed toward bigger or smaller government.

Obama's ultimate goal is a less free, more state-controlled economy, of which Obamacare was only the beginning. The Tea Party was our best chance at stopping his socialist agenda. But because anxiety and fear are always resented, and the Obama vs. Tea Party House confrontations are portrayed as scary by the mainstream media, the American public will probably come to hate the Tea Party House, and the Tea Party may pay a steep price for brinkmanship in the 2014 Congressional elections.

Who will win in deciding America's future? I think Obama has already won. The Democrats will always use the scarecrow of the supposed disaster that will happen if the federal government shuts down to pressure the House into raising the debt ceiling and ending sequestration. Speaker Boehner, by bringing the Senate deal to a floor vote over the Tea Party's objection, has already proven that he buys this argument. If the federal government's vastly bloated bureaucracy is viewed as "necessary," then the debate over America's future is over before it has begun. Look forward to a coalition of the House Democrats and the “moderate” House Republicans, with the Speaker's help, neutralizing the Tea Party-conservative alliance for the next two years, with truly disastrous results for the United States and our economic policy.

The Tea Party may be able to get some spending cuts, but can it seriously alter the structure of American statism? I doubt it. At this point only a series of electoral victories by the Libertarian Party to give the LP legitimacy would pose a true challenge to the dominance of the American Left, and that seems implausible. The Tea Party consists of good people, but the Republican Party as a whole is too soft to win this duel, and the Tea Party has not yet been able to realize its goal, taking control of the GOP from within.




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Fiscal Sanity

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When the Tea Party took control of the House of Representatives in 2010, my worry was that they would sell out and become status quo conservatives — like most Republican politicians who have paid lip-service to laissez faire.  After the 2011 debt crisis, my fear is precisely the opposite.  The Tea Party House is too idealistic, too unwilling to compromise.

It seems to me that most Tea Party House members have been influenced (at some distance, granted) by Murray Rothbard, who suggested that you must insist upon total capitalist freedom right now. They have also been influenced by Ayn Rand, who likened compromise to poison. This must make a lot of libertarians happy, but it makes me both scared and happy. There are two reasons why I am scared, and one very different reason why I am happy.

First, as someone who believes in practical idealism, I believe that change must be enacted slowly or it will be doomed to long-term failure. The government has been quasi-socialist since the New Deal, and the American economic system has developed in such a way that it is designed for government to play a role. Simply eliminating all government intervention overnight instead of gradually phasing statism out would almost certainly harm the economy and worsen the recession, as the system would be unable to cope with the gaps in its structure.

Going from freezing to boiling instantly is a shock to any system, whereas increasing temperature gradually enables an organism to adjust and adapt. If the United States government shuts down before the free market has a chance to adapt and develop systems to replace government functions, the result will be chaos.

Second, if the Tea Party House refuses all compromise and continues to insist upon an idealism-or-nothing approach, the American public may become afraid of the dangers of radical change, and popular sentiment may easily turn against the Tea Party and libertarianism. The Tea Party and libertarianism are not identical, but the Tea Party movement is essentially a populist lowbrow form of libertarianism. If the Tea Party brand becomes unpopular it could set the libertarian movement back decades. The majority of the voting public can easily get scared by apparent extremists who threaten economic calamity in the name of abstract ideals.

This is so even though the Tea Party represents the very best ideals embodied in a long history of American patriotism dating back to the American Revolution. As a case in point, many Tea Party House idealists voted against the debt ceiling compromise, meaning that they wanted the government to default on its debt, which would have triggered a doomsday scenario for the American economy. I suspect that this scared many mainstream voters.

Nevertheless, and in spite of the above, I am actually happy as well as scared that the Tea Party House has taken such an insane approach. The Tea Partiers are crazy, but the modern liberals and conservatives are crazy too, and our insanity is better than theirs. A debt default would have been no more insane than ObamaCare or the war in Iraq. Trillions of dollars of unchecked growth in entitlement spending and more tax-and-spend Democratic budget deficits over the next decade would do more harm than a temporary government shutdown. Lofty idealism is a breath of fresh air, given the stagnant corruption that has emanated from Washington for the past century, and “much must be risked in war” (to quote The Return of the King).

I am happy with the Tea Party House’s strategy because the Tea Party could easily lose the House in 2012 and the movement might stall and dissolve, so this 2011–12 era may be our one and only opportunity to shrink government and restore fiscal sanity. Therefore the Tea Party should continue to fight to cut the government as much as possible, and make it difficult for future Congresses to undo its achievements, because the Tea Party may not last forever. The Tea Party House could be our one shot at saving America from an Obama-led collapse into socialism. In the context of my happiness over the Tea Party House’s unyielding idealism, a little bit of fear isn’t really such a bad thing after all.




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How to Enjoy the Debt Ceiling Fight

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I am enjoying the fight in Washington, D.C., over the debt ceiling — from afar.

If you want the inside dope on what’s happening right now, I don’t have it. I am 3,000 miles away from it, and I have work to do. To me the fight in Washington has mainly been background noise.

In the cocoon of left-liberalism in which I live, the echo is that the “right-wing fanatics in Congress” have gone berserk. That’s what Paul Krugman said in the New York Times, and he is such a smart man. And here is E.J. Dionne of the Washington Post, July 21:

“The tea party lives in an intellectual bubble where the answers to every problem lie in books by F.A. Hayek, Glenn Beck or Ayn Rand. Rand's anti-government writings, regarded by her followers as modern-day scripture — Rand, an atheist, would have bridled at that comparison — are particularly instructive.

“When the hero of Rand's breakthrough novel ‘The Fountainhead’ doesn’t get what he wants, he blows up a building. Rand’s followers see that as gallant. So perhaps it shouldn’t surprise us that blowing up our government doesn’t seem to be a big deal to some of the new radical individualists in our House of Representatives.”

I turn to the No. 1 radical-individualist web page, and see a denunciation of the Tea Party from another place. Here is Brian Wilson on LewRockwell.com, July 23, claming that the Republicans are really progressives:

“When you assume the Republicans are shills for progressivism, the actions make sense and are easily predictable. If the Republicans won the Debt Debate, government spending would really be cut. Which of course, they don’t want. So they had to throw the fight. Unfortunately, like TV wrestling, it becomes more and more obvious the game is rigged. It's as if the rulers in Washington don't even care if we believe their staged fight. It's just a kabuki ritual they have to perform before stealing more of our Freedom.”

Some folks are never satisfied. Being unsatisfied is part of who they are. Not I; some things I find very satisfying. I tend to agree with George Will, who said on July 22 that the Tea Party is “the most welcome political development since the Goldwater insurgency in 1964.”

These are our people. They are for smaller government. They are against the spending and debt. They are for the constitution. I should be on their side because they are on my side.

It pains some libertarians to identify with the Tea Party. Libertarians see themselves as intellectuals, and as political movements go, the Tea Party is middlebrow tending toward lowbrow. Its people listen to Sarah Palin, B.A., Communications, University of Idaho, and Glenn Beck, whose most advanced degree is from Sehome High School, Bellingham, Wash. These Tea Party people know nothing of Lysander Spooner, the Austrian theory of the trade cycle, or the legal doctrine of substantive due process. I recall the comment by Jeffrey Friedman, Ph.D., Yale, and the editor of Critical Review (a publication I can follow only about a quarter of the time) that the Tea Party had trashed the image of libertarianism on university campuses.

Probably so. Still, the Tea Party kicks butt. In 2010, it got a cadre of rabble-rousers elected to Congress. In this debt-ceiling fight, the new Republicans provoke the furious denunciations of the Krugmans, Dionnes, and other stalwarts of the welfare state. You wouldn’t be seeing these fulminations, including Dionne’s furious blast at a novel published nine years before he was born, if the Tea Party weren’t threatening the left-liberal project.

I love it.

How it’s going to work out, I don’t know. I doubt the Left’s hysteria about a worldwide economic crisis that will flush Americans’ 401(l) money down the drain — if this were so, I think, the stock market would have fallen 20% by now — but I don’t know. The market is not all-knowing, and sometimes it comes down with a thump. I wonder whether the promises offered by President Obama and the Senate Democrats to cut two or three trillions in spending are any good. I don’t know that, either, but even if they break their promises, it seems far better to extract those promises now and pin them to their shirts.

Get while the getting’s good, my daddy used to say.

Will the people turn against the Republicans as they did in 1995? Maybe. Or will a large, vague, unenforceable deal work to Obama’s advantage, allowing him to run as a moderate, beat the Republican nominee in 2012, and save the welfare state? That’s the thesis of George Will, who urges the Republicans not to fall for it. I don’t know how they should play their cards, and unlike Will, I am not going to instruct them. I assume they know what they’re doing, and if they don’t, there is nothing I can do about it.

I hear a muted noise from 3,000 miles away, and note that the fight is still on.

I cheer my side.




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What's in a Brand?

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People often complain that the tea partiers confuse socialism, fascism, and communism.  These people argue that the three have distinct definitions and different ideologies.

Well, Chevrolet, Buick, and Cadillac are not the same car. They are, however, different nameplates on similar products, with many parts manufactured by the same people.  They'll all take you to the same place, though some will do it faster.




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Causes and Consequences of the Great Election

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With the Republicans scoring a decisive victory in the Nov. 2 election, the salient questions are: why did it happen, and what effect if any will it have on this country’s governance?

Let me amplify my remark that the Republicans scored a decisive win. As of this writing, the GOP has gained a net of 61 House seats, with the possibility of picking up more (as close races get sorted out). This is the greatest gain in House seats in 60 years. The Republicans have taken a net of six senatorial seats; and they have netted six, possibly seven, governorships. Flying under the mainstream media radar, but hugely consequential, is the net gain of 20 state legislatures and about 700 state legislative seats — consequential, because the state governors and legislators have great redistricting power, and redistricting will necessarily follow the 2010 census. There is just no way to spin away the fact that this was a severe pounding for Obama's party.

For all their mistakes, the Republicans, like hedgehogs, got the one big thing right: they made the election a referendum on Obama and his policies.

So why did the Republicans score such a victory? Several factors are important. To begin with, Obama’s two years in office have revealed him as a narrow-minded leftist ideologue, and a shallow-thinking one at that, who lied about all manner of things. His foreign policy failures have been exceeded only by his domestic policy failures, making him already appear worse than Jimmy Carter, in only a fraction of the time it took Carter to reveal himself as bad. After two years in office, Obama's habit of whining about everything being Bush’s fault rings especially hollow.

For all their mistakes, the Republicans, like hedgehogs, got the one big thing right: they made the election a referendum on Obama and his policies, and the voters responded accordingly.

And there is the undeniable role played by the populist Tea Party organization. This loosely-knit group of populists consists mainly of people discontented about the fiscally ruinous policies that the Troika of Obama, Reid, and Pelosi implemented. The tea partiers brought enthusiasm to the election cycle, and they rightly saw the need to get rid of RINOs such as Mike Castle and Lisa Murkowski. For this they deserve praise. My major criticism is that they stink at vetting candidates — they chose some whose backgrounds were shaky at best (such as Christine O’Donnell, Sharron Angle, and Carl Paladino). Angle, for instance (a candidate whom I reluctantly supported financially), proved to be not exactly a polished public speaker. She lost to Reid in what should have been an easy pickup.

I generally support groups that are unafraid to challenge liberal or overly “moderate” Republicans in primary contests. I'm thinking of such organizations as the Club for Growth, which helped to fund Pat Toomey’s defeat of Arlen Specter in the primary and Toomey’s victorious run for the Senate for Specter’s old seat. But going RINO hunting only makes sense when you have done your homework and identified outstanding candidates to replace the RINOs. Notable here was the Club for Growth’s support of the seasoned and powerfully articulate Marco Rubio — a man with a compelling life story. His candidacy was precisely the way to dump an unprincipled “moderate” hack such as Charlie Crist.

The Tea Partiers show the normal drawbacks of populists. I share their dislike of big government, but I don’t think that the traits of ignorance and passion sit well together. The Tea Party won’t go away, and I wouldn’t want it to; but some coherent thought about what is wrong with the government and what can be done to fix it would be useful. Interesting in this regard was a poll of Tea Party members, showing that 62% of them opposed cutting Medicare and Social Security.

Populists usually profess support for free market economics, but curiously oppose many of the practices that define the system.

I believe that passionate populism was the main reason why the election went the way it did. I also believe that anti-government sentiment will continue to grow, and that the passion we have witnessed so far will reach a public-choice tipping point regarding the welfare state. As the baby boomers age, the expenses of massive entitlement programs will rise inexorably. Ever increasing deficits will wreak havoc with our economy, and we will see repeated outbursts of anti-government populism.

But populism is a two-edged sword. Anti-government populism can get out the vote, but it is an incoherent position, containing within itself the seeds of its own incompetence. The populists hate political pros, and want only neophyte Mr. Smiths going to Washington. But that sets the stage for many more Carl Paladino meltdowns: the populists get charmed by a seemingly likeable outsider (someone who never held any political office, not even a freaking school board seat) and give him the primary victory over more established candidates, only to find numerous defects exposed in the main campaign.

Worse, populists usually profess support for free market economics, but curiously oppose many of the practices that define the system. For example, free market economists from Adam Smith on have stressed the importance of free trade. But populists on both the Left and the Right reject it, espousing a mercantilist philosophy that Smith fought hard to overturn centuries ago. Obama claims that he is creating jobs, but in stoutly opposing free trade, he ensures that job creation will remain lower than it would otherwise be. Many populists would do likewise.

Again, many populists (especially those of the Right) hate the free flow of labor, aka immigration; and the arguments they use make it clear that they are just as opposed to legal as to illegal immigration. They believe that immigrants cost large numbers of jobs, result in lower wages, and (this is usually directed at Latinos) that they refuse to assimilate. Of course, if these ideas are sound — and I do not think that they are — then they argue against all immigration, legal or illegal.

Yet again, many populists (especially those of the Left) love government programs that supposedly help the working class. As I noted earlier, even the majority of Tea Partiers have passionate feelings for Medicare and Social Security. Indeed, Republicans made great hay of pointing out that Obamacare cuts $500 billion from Medicare. But let’s be honest: even without Obama's dramatic expansion of governmental healthcare and the comparatively modest expansion under Bush’s senior drug assistance program, the system of Medicare, Medicaid, and Social Security have been admitted to be unsustainable even by its own trustees.

The Republicans gained from the populist anti-government surge. But the question is what they will be able to do with it, and here I remain skeptical. What are the chances they will actually be able to repeal Obamacare? Rather small. And even if they did repeal it, would that solve the entitlement explosion built into Medicare, Medicaid, and Social Security? Certainly not. The dirty secret is that while people rage against big government, even tea partiers love certain government programs, at least until those programs explode.

And what are the chances the Republican House will be able to get America back on track towards free trade? Again, almost nil. As to the chances of the Republicans getting comprehensive immigration reform, one that insures a reasonable flow of labor to American business, well, these are completely nil also.

The Republicans will be able to do some modest good, such as stopping the proliferation of bailout and stimulus bills, and the creation of new entitlements. And I suspect they may save Bush’s tax cuts, including those for the wealthy. But the bankruptcy of the nation still looms. It is doubtful that, in the near term at least, Republicans can institute the radical changes that are needed to bring entitlement programs into sustainability, or to expand our free market economic system — slashing regulation, lowering corporate income taxes, reforming immigration, getting more free trade agreements enacted, and expanding free choice in education.




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