A limited constitutional government calls for a rules-based, freemarket monetary system, not the topsy-turvy fiat dollar that now exists under central banking. This issue of the Cato Journal examines the case for alternatives to central banking and the reforms needed to move toward free-market money.

The more widespread use of body cameras will make it easier for the American public to better understand how police officers do their jobs and under what circumstances they feel that it is necessary to resort to deadly force.

Americans are finally enjoying an improving economy after years of recession and slow growth. The unemployment rate is dropping, the economy is expanding, and public confidence is rising. Surely our economic crisis is behind us. Or is it? In Going for Broke: Deficits, Debt, and the Entitlement Crisis, Cato scholar Michael D. Tanner examines the growing national debt and its dire implications for our future and explains why a looming financial meltdown may be far worse than anyone expects.

The Cato Institute has released its 2014 Annual Report, which documents a dynamic year of growth and productivity. “Libertarianism is not just a framework for utopia,” Cato’s David Boaz writes in his book, The Libertarian Mind. “It is the indispensable framework for the future.” And as the new report demonstrates, the Cato Institute, thanks largely to the generosity of our Sponsors, is leading the charge to apply this framework across the policy spectrum.

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Tag: centralized government

I’ve argued that the centralization of government spending in Washington over the past century has severely undermined good governance. Citizens get worse outcomes when funding and decisionmaking for education, infrastructure, and other things are made by the central government rather than state and local governments and the private sector. The problem is the same in the European Union, as a new article in Bloomberg on the funding of Polish airports illustrates:

Local authorities are spending some 205 million zloty ($58 million), including more than $44 million in EU subsidies, to build runways and a new terminal that could accommodate more than 1 million passengers a year. The Olsztyn Mazury Airport is scheduled to open next January, but traffic and revenue forecasts developed by the project’s backers are “very far from reality,” says Jacek Krawczyk, a former chairman of LOT Polish airlines who advises the EU on aviation policy through its European Economic and Social Committee.

Szymany adds to a burgeoning supply of costly new airports across Poland. Since 2007, the EU has spent more than €600 million ($666 million) to build or renovate a dozen Polish airports.

… Mostly, though, Poland’s new airports have been a financial bust. A report in December by the European Court of Auditors found that EU-subsidized airport projects in Poland, as well as others in Estonia, Greece, Italy, and Spain, had “produced poor value for money.” Traffic at most airports fell far short of projections, and there was little evidence of broader economic benefits, such as job creation, the report found.

With respect to U.S. infrastructure, there is ongoing pressure to increase federal investment, despite decades of experience on the inefficiency of it. Politicians and lobby groups constantly complain that America does not spend enough on infrastructure. But they rarely discuss how to ensure efficiency in spending, or cite any advantages of federal spending over state, local, and private spending.

I’ve discussed the many downsides to federal aid for infrastructure and other local activities here and here. But I was alerted to an additional argument against aid from this Regulation article by William Fischel and this book by James Bennett. Federal aid encourages local governments to expropriate private property, often for dubious purposes.

The article and book discuss the expropriation of Detroit homes for the benefit of General Motors in the 1980s. The “Poletown” project would not have happened without $200 million in federal and state loans and grants to the city. So Fischel makes the point that (abusive) government uses of eminent domain—such as the Kelo case in New London, Connecticut—are encouraged by the flow of federal and state funds to cities. That is, money for “economic development” and the like.

State and local governments would make better decisions if they were responsible for their own funding of programs and projects. The annual flow of more than $600 billion in federal aid to state and local governments should be phased out over time and eliminated.

Today’s Washington Post reports that residents of Gizab, a village in southern Afghanistan, reclaimed their territory from the Taliban. One U.S. commander called it “perhaps the most important thing that has happened in southern Afghanistan this year.”

Gizab may eventually turn back to Taliban control, but at least for now, we can try and postulate as to why local residents successfully defended their territory, achieving what the coalition has been trying to do for years throughout the country but to no avail. Here’s a thought: allow Afghans to fight the Taliban themselves and slowly back away. Unfortunately, this story may reinforce the atrocious ”One Tribe at a Time” formulation, a strategy that entails coalition troops “going native” and unilaterally choosing tribes to side with against the Taliban–of course, without any proper understanding of tribal or community dynamics beforehand.

As I wrote several weeks ago, “merely increasing our knowledge of Afghanistan’s local politics will not guarantee success; presuming we can simply learn what ethnicities and communities can be ‘peeled off’ from militants does not necessarily mean we will reach the ends we seek or yield the outcomes we want.”

Many moons ago, Christian Bleuer over at The Ghosts of Alexanderwrote about the follies of following the ”One Tribe at a Time”formula. “Seriously, go out and try to find the ‘tribal leadership.’ You will find that there is no clear, stable leadership. Things are in flux, and always have been. Especially since 1979. You will end up with a bunch of squabbling locals trying to call in air strikes on their rivals…. Please don’t let this anecdote draw away attention from how bad Gant’s paper is when considered in its entirety. The blind embedded, hyper-localized ‘adopted son’ mentality he shows should be a warning to all. Anthropologists do their best to not ‘join the tribe.’ So should soldiers.”

Indeed, Judah Grunstein wrote a while back in Small Wars Journalabout this very same issue.“What’s also overlooked – by Gant [author of “One Tribe at a Time”], but also by more conventional COIN theory – is the fact that intervening in a social system creates both winners and losers. COIN bases its methodology in large part on the assumption that losers will shift loyalties in order to compete for the benefits on offer. Again, the lessons from the helping professions show that this is far from a foregone conclusion. The resulting power imbalances within the indigenous structure can instead lead to increased – and rigidified – resentment and hostility toward the helping professional.”

Most analysts in D.C. are waiting for that silver bullet, that one strategy that will help America “win.” But Afghans can “win” without our help, as villagers in Gizab have shown. It may not be easy, and Afghans will surely encounter setbacks, but coalition forces cannot continually recalibrate policy to accurately predict which areas of Afghanistan will prefer the corrupt centralized government we back and which ones will not. It’s time we get out of the way and let Afghans decide their future, Taliban or no Taliban.

Sen. Jim DeMint (R-SC) has been a leader in the fight for fiscal responsibility in Congress. He’s even led on issues that many elected officials have shied away from, such as Social Security reform and free trade. Recently he said that he would support Pat Toomey over Arlen Specter in a Republican primary, which may have prompted Specter’s party switch. DeMint was widely quoted as saying, “I would rather have 30 Republicans in the Senate who really believe in principles of limited government, free markets, free people, than to have 60 that don’t have a set of beliefs.”

It may have been feedback from that comment that caused DeMint to write an op-ed in the Wall Street Journal on his vision of a “Big Tent” Republican party. He makes some excellent points:

But big tents need strong poles, and the strongest pole of our party – the organizing principle and the crucial alternative to the Democrats – must be freedom. The federal government is too big, takes too much of our money, and makes too many of our decisions….

We can argue about how to rein in the federal Leviathan; but we should agree that centralized government infringes on individual liberty and that problems are best solved by the people or the government closest to them.

Moderate and liberal Republicans who think a South Carolina conservative like me has too much influence are right! I don’t want to make decisions for them. That’s why I’m working to reduce Washington’s grip on our lives and devolve power to the states, communities and individuals, so that Northeastern Republicans, Western Republicans, Southern Republicans, and Midwestern Republicans can define their own brands of Republicanism. It’s the Democrats who want to impose a rigid, uniform agenda on all Americans. Freedom Republicanism is about choice – in education, health care, energy and more. It’s OK if those choices look different in South Carolina, Maine and California.

That’s a good federalist, or libertarian, or traditional American conservative vision. But is it really Jim DeMint’s vision?

DeMint says “that centralized government infringes on individual liberty and that problems are best solved by the people or the government closest to them.” And he says it’s OK if “choices look different in South Carolina, Maine and California.” But marriage is traditionally a matter for the states to decide. Some states allow first cousins to marry, others don’t. Some states recognized interracial marriage in the early 20th century, others didn’t. And in every case the federal government accepted each state’s rules; if you had a marriage license from one of the states, the federal government considered you married. But Senator DeMint has twice voted for a constitutional amendment to overrule the states’ power to grant marriage licenses to same-sex couples. In his op-ed, he writes, “Republicans can welcome a vigorous debate about legalized abortion or same-sex marriage; but we should be able to agree that social policies should be set through a democratic process, not by unelected judges.” That’s a reasonable argument, but the amendment that DeMint voted for would overturn state legislative decisions as well as judicial decisions.

Does Jim DeMint believe that “it’s OK if choices [about marriage] look different in South Carolina, Maine, [Vermont, New Hampshire], and California”? If so, he should renounce his support for the anti-federalist federal marriage amendment. If not, then it seems that he opposes the Democrats’ attempts to “impose a rigid, uniform agenda on all Americans … in education, health care, energy and more,” but he has no problem with Republicans imposing their own “rigid, uniform agenda on all Americans” from South Carolina to Vermont.

It might be noted that Senator DeMint also supported the federal attempt to overturn Florida court decisions regarding Terri Schiavo, but we can hope all Republicans have learned their lesson on that bit of mass hysteria.