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Sen. Paul Introduces the Accountability in Grants Act

March 13, 2013 in Politics & Elections

WASHINGTON, D.C. – Today, Sen. Paul introduced the Accountability in Grants Act. This act would remove the authority of the EPA under Section 103 to award money to programs or activities that take place outside of the U.S. This bill would also prevent grant applicants in the U.S. from sub-granting awards to activities or organizations outside of America. Some examples of where taxpayer money is being sent: $141,450 to China to quantify the environmental impacts from different biogas disasters used to treat swine manures in China, $305,849 to the Science and Technology center in the Ukraine, $180,000 to train Polish municipalities on landfill gas, and the list goes on.

‘At a time when our economy is struggling, we cannot afford to spend millions in taxpayer dollars for these projects,’ Sen. Paul said. ‘With a $16 trillion debt, we need to ensure accountability for taxpayer dollars at every level and this bill would be a step in that direction.’

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…read more
Source: RAND PAUL

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What to Cut Next

March 13, 2013 in Economics

By Chris Edwards

Chris Edwards

For supporters of limited government, there is some good news coming from Washington. On entitlement spending, House Budget Committee Chairman Paul Ryan’s new spending plan would reform Medicare and Medicaid, repeal Obamacare, and balance the budget over 10 years.

And on the discretionary side of the federal budget, the recent sequester will, in theory, trim about $1 trillion from projected spending over the next decade, and that comes on top of similar-sized cuts from the budget caps enacted in 2011. Those cuts are only a fraction of the nearly $50 trillion that the federal government is expected to spend over the next 10 years, but they are a start.

Some people are complaining that the sequester is too broad-based, and that it would have been better to target just the most wasteful programs. But members of Congress don’t agree on which programs are wasteful. Republicans point to costly welfare programs such as food stamps, while Democrats point to the bloated Pentagon bureaucracy. Given this disagreement, an across-the-board sequester was the best way to make progress on cuts this year.

The relentless growth in entitlements and the tendency of politicians to add new programs will keep the red ink gushing unless Congress proactively looks for places to cut every year.”

Looking ahead, some policymakers think that no further cuts are needed because the sequester, budget caps, and recent tax hikes reduced projected deficits. But that view is short-sighted. Even if the sequester and budget caps hold, Congressional Budget Office (CBO) projections show that deficits will start rising again after 2015, as the Social Security, Medicare and Medicaid juggernauts keep on growing. Federal spending and debt are expected to rise even faster during the 2020s.

The CBO outlook is scary, but the budget situation is even worse than the long-term CBO baseline shows. That’s because the baseline doesn’t take into account the negative effects of the expanding government on the economy. If spending, taxes and debt keep rising, the growth in gross domestic product will fall, which in turn will cause the ratios of those items to GDP to rise even faster. America will descend into a fiscal death spiral.

Also missing from baseline projections is any new spending that Congress may add in coming years. Another recession would create demands for more “stimulus.” A new military conflict would push up the defense budget. And, as we’ve seen with Hurricane Sandy, …read more
Source: OP-EDS

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OECD Launches New Effort to Undermine Tax Competition

March 13, 2013 in Economics

In recent years, the OECD has ventured into policy activism, with a strong bias toward expanding the burden of government. A new OECD study is very troubling in thsi regard as it proposes to expand the international taxing powers of governments. A new paper by Cato scholar Daniel J. Mitchell argues that such coordinated action to raise taxes would come at the expense of economic freedom and economic growth.

…read more
Source: CATO HEADLINES

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Bloomberg's Soda Grab and the Administrative State

March 13, 2013 in Economics

By Walter Olson

Walter Olson

Mayor Michael Bloomberg and his aides at the NYC Department of Health seem to have been caught unawares Monday when Judge Milton Tingling Jr. struck down their “Portion Cap” ban on large sizes of sweetened beverages. They probably realized the mayor’s signature nanny-state initiative was unpopular with ordinary New Yorkers; but lulled, perhaps, by favorable press, they hadn’t realized how vulnerable it was on legal grounds as well.

In the short term, Judge Tingling’s decision is a delicious win for consumer liberty against the Napoleonic New Bossiness streak in the city’s chief executive. As has been pointed out, however, the judge would not necessarily have struck the regulations down had they been adopted by the New York City Council rather than imposed by the mayor’s appointees through administrative fiat; he wasn’t recognizing any general right of individuals to decide for themselves what foods to consume. Moreover, the judge’s diagnosis of the rules as “arbitrary and capricious” because they were riddled by so many exceptions is at best double-edged from opponents’ standpoint; would we really prefer rules redrafted so as to allow fewer exceptions?

But yesterday’s decision should cheer us for other reasons. It holds the Gotham administration accountable for overstepping the separation of powers, an important principle in the safeguarding of liberty. (In a profile of Judge Tingling, the New York Times notes that he’s been skeptical of government claims to power in a number of other cases as well.)

What are the natural and reasonable limits to the authority of a public health agency?”

Under separation of powers as generally understood at the time of the Framers, an executive agency cannot enact new legislation on its own, that being a role constitutionally reserved for the legislature. Especially during the Progressive Era and New Deal, these barriers were eroded as administrative agencies claimed a power to issue regulations that looked more and more like traditional legislation, under powers deemed to have been delegated by the legislature. Still, there are some limits, both under the U.S. Constitution and in New York (which under a 1987 case called Boreali v. Axelrod applies its own, quirky standard in evaluating whether a regulation oversteps the separation of powers.) And those limits to delegation were at the heart of the soda case.

The New York City Health Department was asserting a breathtakingly broad definition of its powers, on the grounds that successive city charters give it …read more
Source: OP-EDS

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A Father’s Care Package for Warren Buffett: Finally Delivered After 51 Years

March 13, 2013 in Economics

By Daniel J. Sanchez

BuffetCarePackage

Warren Buffett’s father Howard (an anti-New Deal and anti-interventionist Congressman) wrote to Murray Rothbard in 1962 about sending some of Murray’s books to his son. Judging from Warren’s recent comments, it seems the books were lost in the mail. So Mark Thornton has sent this care package to the billionaire investor.

…read more
Source: MISES INSTITUTE

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Is Current Fed Policy Appropriate?

March 13, 2013 in Economics

By John P. Cochran

Frank Shostak says NO!. See:

Should the Fed Reverse Its loose Stance

Some Highlights:

Contrary to popular thinking, loose monetary policy, which leads to a misallocation of resources, weakens the economy’s ability to generate final goods and services, i.e. real wealth.

This means that loose monetary policy not only cannot provide support to the economy but on the contrary undermines the foundations for economic growth.

The so-called recovery that Bernanke and most commentators are referring to is nothing more than the revival of various non-productive or bubble activities [emphaisi mine], which in a true free market environment wouldn’t emerge in the first place.

And

Contrary to popular thinking, loose monetary policy, which leads to a misallocation of resources, weakens the economy’s ability to generate final goods and services, i.e. real wealth.

This means that loose monetary policy not only cannot provide support to the economy but on the contrary undermines the foundations for economic growth.

The so-called recovery that Bernanke and most commentators are referring to is nothing more than the revival of various non-productive or bubble activities, which in a true free market environment wouldn’t emerge in the first place.

Alan Blinder says yes!

Contrast Dr. Shostak’s analysis with Alan Blinder’s Easing the Angst About Fed Easing in today’s Wall Street Journal.

Blinder approvingly quotes Bernanke to Senate banking Committee on Feb. 26:

The FOMC has indicated that it will continue purchases until it observes a substantial improvement in the outlook for the labor market,” he said, making it clear that no such improvement has been seen. He also asserted that “the benefits of asset purchases, and of policy accommodation more generally, are clear: Monetary policy is providing important support to the recovery.

And

Which brings me to the main point: The fundamental case for extreme monetary ease has hardly changed. Mr. Bernanke and the FOMC majority believe deeply in the Fed’s dual mandate, to keep both inflation and unemployment low. They know they are succeeding on the first but failing on the second. They also learned long ago that cutting the federal funds rate by over 500 basis points (five percentage points) was inadequate to combat the recession. Rather than give up, they opted for “unconventional” monetary policies like quantitative easing.

And:

It’s not a pretty picture. But then again, neither is unemployment lingering above 7% indefinitely. This is why Ben Bernanke and the FOMC majority keep plugging away.

Is there a way out? Here’s one thing that could help. As I have argued …read more
Source: MISES INSTITUTE

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The Good and the Bad of the Ryan Budget

March 13, 2013 in Economics

Rep. Paul Ryan’s proposed budget is a decidedly mixed bag, according to a trio of Cato scholars. Tad DeHaven is the most critical, commenting, “What makes the Ryan proposal aggravating is that it’s hardly a vision of limited government. The president promises big government and Ryan promises smaller big government.” But Michael D. Tanner argues that, “while timid and imperfect, Ryan’s plan shows that Republicans are at least looking in the right direction,” a sentiment echoed by Daniel J. Mitchell: “It’s is a step in the right direction, but much more will be needed to restore limited, constitutional government.”

…read more
Source: CATO HEADLINES

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The Right Step from Ryan

March 13, 2013 in Economics

By Michael D. Tanner

Michael D. Tanner

In the kingdom of the blind, according to Erasmus, the one-eyed man is king. And in a land of big spenders, the budget proposed yesterday by Representative Paul Ryan is a model of fiscal rectitude.

Let’s be honest about one thing: The budget introduced yesterday has about as much chance of becoming law as Nancy Pelosi does of being elected pope.

And of course Ryan’s budget relies on a veritable garden’s worth of rosy assumptions in order to reach balance, including the repeal of Obamacare and GDP growth of slightly more than 3 percent. Either or both could happen, but I wouldn’t bet the farm on it.

But at least it is a budget. It has now been more than four years since the Senate produced such a document. While Senate Democrats have pledged to do so this year, recent reports suggest that they are struggling to come up with a plan that can garner support from a majority of their members. Meanwhile, President Obama now says that he may not send a budget plan up to the Hill until the middle of April, despite the fact that the Congressional Budget Act of 1974 requires it to be delivered to Congress no later than the first Monday of February. Give Ryan points, then, for at least doing his job.

The House budget has its flaws, but real virtues, too.”

More important, the Ryan budget provides a view of Republican priorities and their vision for how to increase economic growth, reform entitlements, and balance the budget. While timid and imperfect, Ryan’s plan shows that Republicans are at least looking in the right direction. 

Ryan accepts the $600 billion in tax increases resulting from the fiscal-cliff deal, but rejects any new tax hikes going forward. It also includes pro-growth tax reform — lowering rates while broadening the base.

On the spending side, Ryan would mostly retain the sequester, and would further reduce spending by $5.7 trillion from the current ten-year baseline, bringing the budget into balance by 2023.

However, while we can undoubtedly look forward to news stories about how Ryan would slash spending, his budget doesn’t actually cut spending at all; it merely slows the rate of growth. Indeed, under Ryan’s proposal, federal spending would still grow by an average of 3.4 percent every year. By 2023, we would be spending $1.4 trillion more than we do today. Indeed, spending under …read more
Source: OP-EDS

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Now John Brennan Globally Denies Torture

March 13, 2013 in Economics

By Nat Hentoff

Nat Hentoff

I am postponing a planned column on the educational struggles of low-income kids because of Kentucky Republican Sen. Rand Paul’s rousingly inspirational 13-hour filibuster last week on Barack Obama’s nomination of John Brennan to become director of the CIA. This caused many Americans who do not think of themselves as libertarians to prize anew their individual self-governing constitutional rights against an overreaching government.

I’d previously written that I hoped one day to vote for Paul for president in 2016, knowing his national name recognition was so low that there would be no chance. But now, with the Constitution being reborn among more of us, this March 7 Politico headline looks more likely: “Rand Paul: ‘Seriously’ weighing 2016 bid.”

It is important to keep in mind that the new CIA director was not the subject of Paul’s magnetic 13 hours. As the senator wrote in an editorial for The Washington Times, he used the filibuster “to speak as long as it took, until an alarm was sounded from coast to coast that our Constitution is important, that our rights to trial by jury are precious, and that no American should be killed by a drone on U.S. soil without having been found guilty in a court of law” (“Rising in defense of the Constitution,” Rand Paul, Washington Times, March 8).

Paul’s maneuver, which would have delighted James Madison, was essentially aimed at the extra-constitutional reign of President Obama. Paul thought he won an important round in that battle, but another battle remained. Brennan became the CIA director the day after the filibuster began. This officially demonstrated to the world, both our allies and our terrorist enemies, that Brennan’s previous internal support of CIA torture and other brutal crimes would not prevent his promotion.

However, as Paul emphasized in the Times, “I didn’t rise to oppose Mr. Brennan’s nomination simply based on him as a person. I rose to defend the principles of our Constitution, principles for which we have fought long and hard.”

I, on the other hand, continue to oppose Mr. Brennan as a person.

But before examining Brennan’s record, I should explain what Paul requested from the Obama administration prior to his filibuster:

“When I asked the president, ‘Can you kill an American on American soil?’ it should have been an easy answer,” Paul wrote. “It should have been a resounding and unequivocal, ‘no.’ But what was the president’s response?

“For his first response, the …read more
Source: OP-EDS