by Sara Burk

November 17, 2007

Michael Moore ends the movie "Sicko" with a lie. It may not be an intentional lie, but it is a falsehood, nonetheless. Michael Moore ends the movie saying that every European country offers "free" health coverage to their citizens and every European country provides such coverage through a "single payer" system.

Both statements are untrue. It is a sad commentary on the pathetically, uninformed state of the health care policy debate in America that health care journalists and American political leaders do not simply know that both of the statements are untrue and that they have not responded clearly and quickly to correct the error.

So what makes these statements untrue? Reality. Most European countries directly charge their citizens for their health coverage. It is not "free" anywhere. Some nations require people to buy coverage from health insurance companies that look very much like American health insurance companies. Other countries use a payroll tax on everyone's paycheck to pay for health coverage. In those countries, each citizen pays a portion of their weekly paycheck for health insurance - - just like our Social Security payroll deduction. In Germany, each employee pays 7 percent of each paycheck for health care and each employer matches that 7 percent. People also can spend additional money to buy better coverage.

The government of the Netherlands takes 9 percent of a worker's paycheck every week to purchase health coverage - - it's hard to figure out how Michael Moore can legitimately call such a payroll deduction "free."

Also, when the government of the Netherlands deducts that 9 percent, or when Germany deducts their 14 percent -- they do not use, as Mr. Moore incorrectly claims, a "single payer system" like Canada to provide the actual health insurance for each citizen. Each of those countries has multiple health plans - or "sickness funds" -- that people choose among. Citizens of Switzerland and the Netherlands choose between competing health plans to purchase their coverage.

So "Sicko" ends with a double lie: Coverage in Europe is not "free," nor is it provided through a pure, Canadian-like single payer system. "Sicko" either deliberately misleads us or is unintentionally wrong.

Each country in Europe has found its own unique path to universal coverage. Switzerland has no government health program at all. Everyone in Switzerland is required to purchase from one of nearly 100 competing insurance companies. (The Swiss government pays for coverage for the poor.)

What about France - - a country Michael Moore described as Eden in "Sicko?" The government uses a sales tax approach and uses that money to buy a basic (not comprehensive) package of coverage for about 80 percent of the French people. The basic government benefit coverage is somewhat incomplete, however, so 92 percent of the people in France now purchase additional private insurance to fill in the 20 - 40 percent gap in various parts of their government benefits. About 20 percent of the French people skip the government program completely and purchase only private coverage. In either case, the coverage isn't free and is not handled through a Canadian single-payer model.

It's unclear from the movie whether Mr. Moore knows that he is not telling the truth about Europe's health care systems, or whether he is still low on a learning curve relative to health care financing and delivery. The learning curve seems pretty steep. He criticizes the U.S. government Medicare drug benefit in "Sicko," and he claims with some passion that the Canadians handle drug coverage much better. So how does the Canadian government actually handle drug coverage? Seven out of eight provinces do not cover non-hospital drug costs for anyone other than low income seniors. The federal government does not cover anyone.

People in those seven Canadian provinces might actually prefer the American Medicare system of partial coverage (favored by over 80 percent of enrollees), which Mr. Moore seems to sneer at in the movie. American Medicare drug coverage can have a "donut hole" in the middle. Seven of eight Canadian provinces skip the donut and give the citizens only the hole.

"Sicko" also tells the story of a Canadian on a golf vacation in Florida to illustrate the alleged superiority of the Canadian insurance and care delivery system because - - Mr. Moore claims in the movie - - the Canadian actually rushed home to Canada when he needed health care rather than getting that care in Florida. A valuable piece of information that "Sicko" conveniently does not mention at that point is that the Canadian government health coverage does not travel. Americans who are insured almost always have health coverage that covers at least emergencies whenever we travel. Canadians, however, have such long backlogs for care in so many places that the Canadian government benefit program can't afford to let people simply leave Canada to access care elsewhere. So the Canadian system that Mr. Moore so eagerly advocates decided not to let its health care benefits "travel" outside of Canada. Canadians in Florida, therefore, actually do return to Canada for care when they can... not because they don't think Americans deliver quality care, rather because their government does not cover care in America.

Again, it's not clear if Mr. Moore is low on the learning curve on that point, or more directly duplicitous. We will probably learn which statement is true as the debate progresses.

There are rumors Mr. Moore offers $10,000 rewards for anyone who can prove that any point in his movies is untrue. Since he says that "every" country in Europe uses the Canadian model, and since there are quite a few countries in Europe, does he owe $10,000 per country or just $10,000 for getting Europe wrong as a package? Or is it $10,000 per country on "single payer" and another $10,000 per country for "free"?

We can let his conscience decide. Money is owed, however.

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Sarah Berk is Executive Director of Health Care America

Her article appeared on Townhall.com, August 22, 2007

POLITICAL "SOLUTIONS"

By Thomas Sowell

October 31, 2007

It is remarkable how many political "solutions" today are dealing with problems created by previous political "solutions." Three examples that come to mind immediately are the housing market crisis, the wildfires in southern California, and the water shortages in the west.

Congress and the Bush administration are currently vying with each other to come up with a solution to the housing crisis, brought on by widespread defaults on home mortgage loans -- especially defaults by those who took out risky "subprime" loans.

Why were borrowers taking out risky loans in the first place? And why were lenders willing to lend to risky borrowers? In both cases, the government was a prime factor in "subprime" loans.

Many people took out risky mortgage loans to buy a house because housing prices were so high that this was the only way they could own a home. Where housing prices were highest, the most people took out risky loans.

In the San Francisco Bay Area, where housing prices are the highest in the nation, risky interest-only loans went from being 11 percent of all new mortgages in 2002 to being 66 percent of all new mortgages in 2005.

Study after study has shown that housing prices are highest where government restrictions on building are the most severe. That is the ugly result of pretty words like "open space."

Why were lenders lending to people whose prospects of repaying the loans were below average -- that is, "subprime"?

Government laws and policies, especially the Community Reinvestment Act, pressured lenders to invest in people and places where they would not invest otherwise. Government also created the temporarily very low interest rates that made the mortgages seem affordable for the moment.

Now that politicians have created this mess, they are ready to play heroes riding to the rescue.

As for the flames sweeping across southern California, tragic as that is, this has happened time and again before -- in the very same places in the very same time of year, just like hurricanes.

Why would people risk building million-dollar homes in the known paths of wildfires? For the same reason that people choose to live in the known paths of hurricanes. Because the government -- that is, the taxpayers -- will get stuck with a lot of the costs of dealing with those dangers and the costs of rebuilding.

Why is there such a huge amount of inflammable vegetation over such a wide area that fires can reach unstoppable proportions by the time they get to places where people live? Because "open space" has become a political sacred cow beyond rational discussion.

The same severe government restrictions on building that drive home prices sky high also lead to vast areas with nothing but trees and bushes. Where it doesn't rain for months, that's dangerous.

No matter how much open space there is, it is never enough for environmental extremists, who will make political trouble if anyone is allowed to break up those miles and miles of solid vegetation with buildings, even though pavement and masonry don't burn.

In other words, government preserves all the conditions for wildfires and subsidizes people who live in their path.

As for water shortages, they are as endemic to California as wildfires. But when an economist hears about a shortage that persists for years, the first question that comes to mind is: Why doesn't the price rise until supply and demand are equal?

If you said, "the government," go to the head of the class.

The federal government's water projects supply much of the water used in California that enables agriculture to flourish in what would otherwise be a desert.

The government sells this water to farmers at prices artificially lower than the cost of providing it -- and at a tiny fraction of what people pay for water in Los Angeles or San Francisco.

Is it news, at this late date, that people waste things that they get cheap? It's been happening for centuries.

But none of the political "solutions" through drastic water rationing schemes will touch the cheap prices of water that lead farmers to grow crops requiring huge amounts of water in a desert.

Thomas Sowell is a senior fellow at the Hoover Institute and author of Basic Economics: A Citizen's Guide to the Economy. The above article appeared on TownHall.com, Tuesday, October 30, 2007

IN THE NAME OF PATRIOTISM

by Ron Paul

October 15, 2007

For some, patriotism is "the last refuge of a scoundrel." For others, it means dissent against a governments abuse of the peoples rights.

I have never met a politician in Washington, or any American for that matter, who chose to be called "unpatriotic." Nor have I met anyone who did not believe he wholeheartedly supported our troops wherever they may be.

What I have heard all too frequently from various individuals is sharp accusations that because their political opponents disagree with them on the need for foreign military entanglements, they were "unpatriotic, un-American, evil doers deserving contempt."

The original American patriots were those individuals brave enough to resist with force the oppressive power of King George. I accept the definition of patriotism as that effort to resist oppressive state power. The true patriot is motivated by a sense of responsibility, and out of self interest -- for himself, his family, and the future of his country -- to resist government abuse of power. He rejects the notion that patriotism means obedience to the state.

Resistance need not be violent, but the civil disobedience that might be required involves confrontation with the state and invites possible imprisonment.

Peaceful non-violent revolutions against tyranny have been every bit as successful as those involving military confrontation. Mahatma Gandhi and Dr. Martin Luther King, Jr. achieved great political successes by practicing non-violence, yet they themselves suffered physically at the hands of the state.

But whether the resistance against government tyrants is non-violent or physically violent, the effort to overthrow state oppression qualifies as true patriotism.

True patriotism today has gotten a bad nameat least from the government and the press. Those who now challenge the unconstitutional methods of imposing an income tax on us, or force us to use a monetary system designed to serve the rich at the expense of the poor, are routinely condemned. These American patriots are sadly looked down upon by many. They are never praised as champions of liberty as Gandhi and Martin Luther King Jr. have been.

Liberals, who withhold their taxes as a protest against war, are vilified as wellespecially by conservative statists.

Unquestioned loyalty to the state is especially demanded in times of war. Lack of support for a war policy is said to be unpatriotic. Arguments against a particular policy that endorses a war once its started, are always said to be endangering the troops in the field. This, they blatantly claim, is unpatriotic and all dissent must stop. Yet it is dissent from government policies that defines the true patriot and champion of liberty.

It is conveniently ignored that the only authentic way to best support the troops is to keep them out of dangerous, undeclared, no-win wars that are politically inspired. Sending troops off to war for reasons that are not truly related to national security -- and for that matter may even damage our security -- is hardly a way to "patriotically" support the troops.

Who are the true patriots: those who conform or those who protest against wars without purpose? How can it be said that blind support for war, no matter how misdirected the policy, is the duty of the patriot?

Randolph Bourne said that "war is the health of the state." With war, he argued, the state thrives. Those who believe in the powerful state see war as an opportunity. Those who mistrust the people and the market for solving problems have no trouble promoting a "war psychology" to justify the expansive role of the state.

This includes the role the federal government plays in our personal lives as well as in all our economic transactions. And certainly the neo-conservative belief that we have a moral obligation to spread American values worldwide, through force, justifies the conditions of war in order to rally support at home for the heavy hand of government. It is through this policy, it should surprise no one, that our liberties are undermined, the economy becomes overextended, and our involvement worldwide becomes prohibitive.

Out of fear of being labeled unpatriotic, most citizens become compliant and accept the argument that some loss of liberty is required to fight the war in order to remain safe. This is a bad trade-off in my estimation, especially when done in the name of patriotism.

Loyalty to the state and to autocratic leaders is substituted for true patriotismthat is, a willingness to challenge the state and defend the country, the people, and the culture. The more difficult the times, the stronger the admonition becomes that the leaders be not criticized.

Because the crisis atmosphere of war supports the growth of the state, any problem invites an answer by declaring "war" -- even on social and economic issues. This elicits patriotism in support of various government solutions while enhancing the power of the state. Faith in government coercion and a lack of understanding of how free societies operate, encourages big government liberals and big government conservatives to manufacture a war psychology to demand political loyalty for domestic policy just as is required in foreign affairs. The long term cost in dollars spent and liberties lost is neglected as immediate needs are emphasized.

It is for this reason that we have multiple perpetual wars going on simultaneously. Thus the war on drugs, against gun ownership, poverty, illiteracy, and terrorism, as well as our foreign military entanglements, are endless.

All this effort promotes the growth of statism at the expense of liberty. A government designed for a free society should do the opposite: prevent the growth of statism and preserve liberty. Once a war of any sort is declared, the message is sent out not to object or you will be declared unpatriotic. Yet, we must not forget that the true patriot is the one who protests in spite of the consequences, condemnation or ostracism, or even imprisonment that may result.

Non-violent protesters of the tax code are frequently imprisonedwhether they are protesting the codes unconstitutionality or the war that the tax revenues are funding.

Resisters to the military draft, or even to selective service registration, are threatened and imprisoned for challenging this threat to liberty.

Statism depends on the idea that the government owns us and citizens must obey. Confiscating the fruits of our labor through the income tax is crucial to the health of the state. The draft, or even the mere existence of the selective service, emphasizes that we will march off to war at the states pleasure. A free society rejects all notions of involuntary servitude whether by draft or the confiscation of the fruits of our labor through the personal income tax.

A more sophisticated and less well known technique for enhancing the state is the manipulation and transfer of wealth through the fiat monetary system operated by the secretive Federal Reserve. Protestors against this unconstitutional system of paper money are considered unpatriotic criminals and at times are imprisoned for their beliefs. The fact that, according to the Constitution, only gold and silver are legal tender and paper money is outlawed, matters little. The principle of patriotism is turned on its head.

Whether its with regard to the defense of welfare spending at home, confiscatory income tax, an immoral monetary system, or support for a war fought under false pretense without a legal declaration, the defenders of liberty and the Constitution are portrayed as unpatriotic while those who support these programs are seen as the patriots. If theres a "war" going on, supporting the states efforts to win the war is expected at all costs. No dissent!

The real problem is that those who love the state too often advocate policies that lead to military action. At home they are quite willing to produce a crisis atmosphere and claim a war is needed to solve the problem. Under these conditions the people are more willing to bear the burden of paying for the war, and to carelessly sacrifice liberties which they are told is necessary.

The last six years have been quite beneficial to the "health of the state," which comes at the expense of personal liberty. Every enhanced unconstitutional power of the state can only be achieved at the expense of individual liberty.

Even though every war in which we have been engaged civil liberties have suffered, some have been restored after the war ended, but never completely. This has resulted in a steady erosion of our liberties over the past 200 years. Our government was originally designed to protect our liberties, but it has now instead become the usurper of those liberties.

We currently live in the most difficult of times for guarding against an expanding central government with a steady erosion of our freedoms.

We are continually being reminded that "9/11 has changed everything." Unfortunately, the policy that needed most to be changedthat is our policy of foreign interventionismhas only been expanded. There is no pretense any longer that a policy of humility in foreign affairs, without being the worlds policeman and engaging in nation building, is worthy of consideration. We now live in a post 9/11 America where our government is going to make us safe no matter what it takes. Were expected to grin and bear it and adjust to every loss of our liberties in the name of patriotism and security.

Though the majority of Americans initially welcomed this declared effort to make us safe, and were willing to sacrifice for the cause, more and more Americans are now becoming concerned about civil liberties being needlessly and dangerously sacrificed. The problem is that the Iraq war continues to drag on and a real danger of its spreading exists. Theres no evidence that a truce will soon be signed in Iraq , or in the war on terror or drugs. Victory is not even definable. If Congress is incapable of declaring an official war, its impossible to know when it will end. We have been fully forewarned that the world conflict in which were now engaged will last a long, long time.

The war mentality, and the pervasive fear of an unidentified enemy, allows for a steady erosion of our liberties, and with this our respect for self reliance and confidence is lost. Just think of the self sacrifice and the humiliation we go through at the airport screening process on a routine basis. Though theres no scientific evidence of any likelihood of liquids and gels being mixed on an airplane to make a bomb, billions of dollars are wasted throwing away toothpaste and hairspray and searching old women in wheelchairs.

Our enemies say boo, and we jump, we panic, and then we punish ourselves. Were worse than a child being afraid of the dark. But in a way, the fear of indefinable terrorism is based on our inability to admit the truth about why there is a desire by a small number of angry radical Islamists to kill Americans. Its certainly not because they are jealous of our wealth and freedoms.

We fail to realize that the extremists, willing to sacrifice their own lives to kill their enemies, do so out of a sense of weakness and desperation over real and perceived attacks on their way of life, their religion, their country and their natural resources. Without the conventional diplomatic or military means to retaliate against these attacks, and an unwillingness of their own government to address the issue, they resort to the desperation tactic of suicide terrorism. Their anger toward their own governments, which they believe are co-conspirators with the American government, is equal to or greater than that directed toward us. These errors in judgment in understanding the motive of the enemy and the constant fear that is generated have brought us to this crisis where our civil liberties and privacy are being steadily eroded in the name of preserving national security. We may be the economic and military giant of the world, but the effort to stop this war on our liberties here at home in the name of patriotism, is being lost.

The erosion of our personal liberties started long before 9/11, but 9/11 accelerated the process. There are many things that motivate those who pursue this courseboth well-intentioned and malevolent. But it would not happen if the people remained vigilant, understood the importance of individual rights, and were unpersuaded that a need for security justifies the sacrifice of libertyeven if its just now and then.

The true patriot challenges the state when the state embarks on enhancing its power at the expense of the individual. Without a better understanding and a greater determination to reign in the state, the rights of Americans that resulted from the revolutionary break from the British and the writing of the Constitution, will disappear.

The record since September 11, 2001, is dismal. Respect for liberty has rapidly deteriorated.

Many of the new laws passed after 9/11 had in fact been proposed long before that attack. The political atmosphere after that attack simply made it more possible to pass such legislation. The fear generated by 9/11 became an opportunity for those seeking to promote the power of the state domestically, just as it served to falsely justify the long planned-for invasion of Iraq .

The war mentality was generated by the Iraq war in combination with the constant drum beat of fear at home. Al Qaeda and Osama bin Laden, who is now likely residing in Pakistan , our supposed ally, are ignored, as our troops fight and die in Iraq and are made easier targets for the terrorists in their backyard. While our leaders constantly use the mess we created to further justify the erosion of our constitutional rights here at home, we forget about our own borders and support the inexorable move toward global governmenthardly a good plan for America.

The accelerated attacks on liberty started quickly after 9/11. Within weeks the Patriot Act was overwhelmingly passed by Congress. Though the final version was unavailable up to a few hours before the voteno Member had sufficient time to read or understand itpolitical fear of "not doing something," even something harmful, drove Members of Congress to not question the contents and just vote for it. A little less freedom for a little more perceived safety was considered a fair tradeoffand the majority of Americans applauded.

The Patriot Act, though, severely eroded the system of checks and balances by giving the government the power to spy on law abiding citizens without judicial supervision. The several provisions that undermine the liberties of all Americans include: sneak and peak searches; a broadened and more vague definition of domestic terrorism; allowing the FBI access to libraries and bookstore records without search warrants or probable cause; easier FBI initiation of wiretaps and searches, as well as roving wiretaps; easier access to information on American citizens use of the internet; and easier access to e-mail and financial records of all American citizens.

The attack on privacy has not relented over the past six years. The Military Commissions Act is a particularly egregious piece of legislation and, if not repealed, will change America for the worse as the powers unconstitutionally granted to the Executive Branch are used and abused.

This act grants excessive authority to use secretive military commissions outside of places where active hostilities are going on. The Military Commissions Act permits torture, arbitrary detention of American citizens as unlawful enemy combatants at the full discretion of the president and without the right of Habeas Corpus, and warrantless searches by the NSA (National Security Agency). It also gives to the president the power to imprison individuals based on secret testimony.

Since 9/11, Presidential signing statements designating portions of legislation that the President does not intend to follow, though not legal under the Constitution, have enormously multiplied. Unconstitutional Executive Orders are numerous and mischievous and need to be curtailed.

Extraordinary rendition to secret prisons around the world has been widely engaged in, though obviously extra-legal.

A growing concern in the post 9/11 environment is the federal governments lists of potential terrorists based on secret evidence. Mistakes are made and sometimes it is virtually impossible to get ones name removed, even though the accused is totally innocent of any wrongdoing.

A national ID card is now in the process of being implemented. Its called the Real ID card and its tied to our Social Security numbers and our state drivers license. If Real ID is not stopped it will become a national drivers license/ID for all America .

Some of the least noticed and least discussed changes in the law were the changes made to the Insurrection Act of 1807 and to Posse Comitatus by the Defense Authorization Act of 2007.

These changes pose a threat to the survival of our republic by giving the president the power to declare martial law for as little reason as to restore "public order." The 1807 Act severely restricted the president in his use of the military within the United States borders, and the Posse Comitatus Act of 1878 strengthened these restrictions with strict oversight by Congress. The new law allows the president to circumvent the restrictions of both laws. The Insurrection Act has now become the "Enforcement of the Laws to Restore Public Order Act". This is hardly a title that suggests that the authors cared about or understood the nature of a constitutional republic.

Now, martial law can be declared not just for "insurrection" but also for "natural disasters, public health reasons, terrorist attacks or incidents" or for the vague reason called "other conditions." The President can call up the National Guard without Congressional approval or the governors approval and even send these state guard troops into other states. The American republic is in remnant status. The stage is set for our country eventually devolving into a military dictatorship and few seem to care.

These precedent setting changes in the law are extremely dangerous and will change American jurisprudence forever if not reversed. The beneficial results of our revolt against the kings abuses are about to be eliminated and few Members of Congress and few Americans are aware of the seriousness of the situation. Complacency and fear drive our legislation without any serious objection by our elected leaders.

Sadly, those few who do object to this self evident trend away from personal liberty and empire building overseas are portrayed as unpatriotic and uncaring.

Though welfare and socialism always fails, opponents of them are said to lack compassion. Though opposition to totally unnecessary war should be the only moral position, the rhetoric is twisted to claim that patriots who oppose the war are not "supporting the troops". The cliché "support the troops" is incessantly used as a substitute for the unacceptable notion of "supporting the policy" no matter how flawed it may be. Unsound policy can never help the troops. Keeping the troops out of harms way and out of wars unrelated to our national security is the only real way of protecting the troops. With this understanding, just who can claim the title of "patriot"?

Before the war in the Middle East spreads and becomes a world conflict, for which well be held responsible, or the liberties of all Americans become so suppressed we can no longer resist, much has to be done. Time is short but our course of action should be clear. Resistance to illegal and unconstitutional usurpation of our rights is required. Each of us must choose which course of action we should takeeducation, conventional political action, or even peaceful civil disobedience, to bring about the necessary changes.

But let it not be said that we did nothing.

Let not those who love the power of the welfare/warfare state label the dissenters of authoritarianism as unpatriotic or uncaring. Patriotism is more closely linked to dissent than it is to conformity and a blind desire for safety and security. Understanding the magnificent rewards of a free society makes us unbashful in its promotion, fully realizing that maximum wealth is created and the greatest chance for peace comes from a society respectful of individual liberty.

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Rep. Ron Paul ( R ) Texas delivered the above message on the floor of the House of Representatives, May 22, 2007

ILLEGAL IMMIGRANTS AND THE HOUSING BUBBLE

Mark Thornton

October 1, 2007

If you watch Lou Dobbs' show you would think that illegal immigration is the biggest problem facing America today worse than government inflation and the Fed, standing armies, the military-industrial complex and Operation Iraqi Freedom, and government spying and suppression of our rights.

Immigration, illegal or otherwise, is not the problem per se. We are, after all, a nation of immigrants, and mostly of the poverty-stricken sort. It is a shame that the son of a failed Texas propane salesman, Dobbs himself is a former welfare worker and ambulance-chasing news reporter, so you would think that Dobbs would have sympathy for these immigrants and look for the real cause of the problem elsewhere.

The only national problem with immigration lies with government. Because immigrants are relatively poor they tend to pay less in taxes than their use of so-called government services like health care and education, and thus increase taxes on citizens. We can therefore solve the immigration problem by simply eliminating government programs that provide free services. Note: we would simultaneously solve the problems of education and health care by placing these industries back into the private sector.

One question that doesn't get addressed by Dobbs or anyone else is the reason for the mad rush of illegal immigration why have so many people entered the country illegally in recent years. One possibility is the legal system which has sought to protect the rights of people, particularly immigrants, and thus prevented government bureaucrats from controlling the flow of immigration.

This however is at best a partial explanation because it is difficult to imagine government bureaucrats accomplishing anything of note. Eleven or so federal bureaucracies and the mighty US military failed to protect us from the 9/11 attacks. The TSA army of airport security personnel has failed multiple tests to prevent weapons from being brought on airplanes. The FDA has allowed deadly drugs into the market, while preventing useful ones. Meanwhile under its so-called protection the number of food poisonings seems to be increasing alarmingly, while it wages war against the relatively benign and low-cost industries that provide vitamins, supplements, and alternative medical approaches to healthcare.

Why would we expect the border-control and immigration bureaucracies to be any different? This is especially the case when potential immigrants have such a powerful economic interest in moving to the United States. The rest of the world has made tremendous progress in recent years by adopting more liberal economic policies, but there is still a huge gap between the standard of living in America and that of places such as Mexico, South America, Africa, Eastern Europe, and Asia.

The question remains: why all the recent immigration? I believe that the answer lies to a large degree with the housing bubble in the United States. The normal number of housing starts is about one million per year, but housing starts have exceeded one million every year since the early 1990s. The housing bubble appeared in the wake of the bursting of the technology stock bubble and only began to unravel in 2006. Housing starts have already returned to normal levels, but are soon likely to go below normal levels.

What does this have to do with illegal immigration? Immigrants, particularly illegal Mexican immigrants, have largely found jobs in industries associated with the housing bubble. Immigrants work at jobs in the construction, landscaping, and road construction industries. Employment in the construction industry alone is currently nearly two million jobs above trend (7.7 versus 5.9 million). Of course many of the illegal immigrants are not even counted in such statistics, but just take a look at residential, landscaping, and road construction sites and you are likely to find many non English-speaking immigrants.

Therefore immigrants have a powerful economic incentive to move to America lavish government benefits plus good paying jobs that are the result of the housing bubble. The boom phase of the business cycle and bubbles naturally misallocate labor from one industry to another, and in the case of the housing bubble it has been to allocate labor to the construction, mortgage, and real estate industries with immigrants helping to fill the gaps in the construction industry.

Of course all of this will have to be undone because all bubbles eventually burst to one extent or another and all booms eventually are followed by "corrections" that drive whole economies, regions, and industries into economic slumps. A slump in construction will lead to unemployment and bankruptcies. In terms of immigrants we will likely see many return home, or turn up on government welfare rolls another legacy of the Greenspan Fed.

You don't have to be a rocket scientist to solve these problems. We need to return to the sound monetary policy of the gold standard and an America where education and assistance to the needy are in the hands of the private sector, not government bureaucrats.

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Mark Thornton teaches economics at Auburn University. He is a senior resident fellow at the Ludwig von Mises Institute in Auburn, Alabama, and is the Book Review Editor for the Quarterly Journal of Austrian Economics. He is co-author of Tariffs, Blockades, and Inflation: The Economics of the Civil War.

(The above article was originally posted on the Ludwig Von Misses Institute website, March 13, 2007)

ABANDON ALL UNWINNABLE WARS

By Gary M. Galles

August 31, 2007

Senate Majority Leader Harry Reid triggered a flurry of partisan attacks and counterattacks with his statement that "this war is lost, and this surge is not accomplishing anything." Perhaps most striking about his assertion that we ought to abandon rather than escalate a war that cannot be won is how inconsistently it is applied. There are a host of government sponsored domestic "wars" to which that same argument applies, yet they get escalated rather than ended.

This is illustrated by some politicians' intense opposition to the Iraq war, because of its negative consequences, while at the same time, those same people call every new domestic policy initiative of theirs a war, in order to galvanize support for it. In fact, war imagery may be the most commonly abused analogy in politics.

We have heard that "war is hell," "all's fair in love and war," and "war is politics by other means" (any combination of which illustrates the risks of compounding imperfect analogies). We heard that the 1970s oil crisis was the moral equivalent of war (although government price controls did far more damage than OPEC, making one wonder who declared war on American citizens). And government wars have been declared on every problem, from drugs and crime to poverty and illiteracy.

Unfortunately, the imagery of urgency, resolve and "giving all we've got" for the good of the country doesn't match the policies actually implemented or their effects on taxpayers' pockets and citizens' liberties. Rather, declarations of such "wars" are often just dramatic rhetoric used to promote politicians' pet programs, which do more harm than good, such as the vast invasions of property and privacy, as well as increases in violence and corruption, triggered by the unwinnable but frequently escalated War on Drugs.

War imagery is invoked to show determination to win. But as Senator Reid and others assert with regard to Iraq, shooting wars have no winners; just those who lose more and those who lose less as casualties mount. However, the casualties caused are the last thing social "war on X" supporters ever discuss, although any honest evaluation would find many casualties, as with large public housing projects which became "instant slums" or the litany of failed training programs promoted as part of the War on Poverty.

Wars also end with a formal surrender. But government wars on poverty, drugs, etc., can never be won in a similar way. If a belief that the war in Iraq cannot be won is a reason to end it, it is equally a reason to end those domestic wars.

Because of its powerful emotional impact, war imagery and language is also abused in other ways that would make George Orwell proud. We hear of "trade wars" in language implying that they are contests between domestic and foreign producers, so that protectionism for "our" firms against "their" firms sounds sensible. However, both buyers and sellers expect to gain by trading, or they would not voluntarily participate, so that trade creates wealth (why every defensible study of protectionism finds that it destroys wealth). Protectionism, in fact, is an alliance between domestic producers and the government declaring war on domestic consumers to force them to pay higher prices.

Those in Washington who constantly reiterate their opposition to a war they say can't be won are the same people who propose wars to "solve" every other crisis (often caused by their "solution" to some earlier alleged crisis). But those policy wars are never won either. Rather than being given up as unwinnable, they get escalated, expanding government encroachment on our shrinking freedoms, with increasingly adverse effects. Adding more government intervention in virtually every aspect of our lives because politicians who oppose war call everything else a war, cannot stand up to careful examination.

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Gary M. Galles is a professor of economics at Pepperdine University.

This appeared on The Ludwig Von Mises Institute website, 5/29/2007

DO AWAY WITH PUBLIC SCHOOLS

By Jonah Goldberg

August 16, 2007

Here's a good question for you: Why have public schools at all?

OK, cue the marching music. We need public schools because blah blah blah and yada yada yada. We could say blah is common culture and yada is the government's interest in promoting the general welfare. Or that children are the future. And a mind is a terrible thing to waste. Because we can't leave any child behind.

The problem with all these bromides is that they leave out the simple fact that one of the surest ways to leave a kid "behind" is to hand him over to the government. Americans want universal education, just as they want universally safe food. But nobody believes that the government should run nearly all of the restaurants, farms and supermarkets. Why should it run the vast majority of the schools - particularly when it gets terrible results?

Consider Washington, home of the nation's most devoted government-lovers and, ironically, the city with arguably the worst public schools in the country. Out of the 100 largest school districts, according to the Washington Post, D.C. ranks third in spending for each pupil ($12,979) but last in spending on instruction. Fifty-six cents out of every dollar go to administrators who, it's no secret, do a miserable job administrating, even though D.C. schools have been in a state of "reform" for nearly 40 years.

In a blistering series, the Post has documented how badly the bureaucrats have run public education. More than half of the District of Columbia's teenage kids spend their days in "persistently dangerous" schools, with an average of nine violent incidents a day in a system with 135 schools. "Principals reporting dangerous conditions or urgently needed repairs in their buildings wait, on average, 379 days ... for the problems to be fixed," according to the Post. But hey, at least the kids are getting a lousy education. A mere 19 schools managed to get "proficient" scores or better for a majority of students on the district's Comprehensive Assessment Test.

A standard response to such criticisms is to say we don't spend enough on public education. But if money were the solution, wouldn't the district, which spends nearly $13,000 on every kid, rank near the top? If you think more money will fix the schools, make your checks out to "cash" and send them to me.

Private, parochial and charter schools get better results. Parents know this. Applications for vouchers in the district dwarf the available supply, and home schooling has exploded.

As for schools teaching kids about the common culture and all that, as a conservative I couldn't agree more. But is there evidence that public schools are better at it? The results of the 2006 National Assessment of Educational Progress history and civics exams showed that two-thirds of U.S. high school seniors couldn't identify the significance of a photo of a theater with a sign reading "Colored Entrance." And keep in mind, political correctness pretty much guarantees that Jim Crow and the civil rights movement are included in syllabi. Imagine how few kids can intelligently discuss Manifest Destiny or free silver.

Right now, there's a renewed debate about providing "universal" health insurance. For some liberals, this simply means replicating the public school model for health care. (Stop laughing.) But for others, this means mandating that everyone have health insurance - just as we mandate that all drivers have car insurance - and then throwing tax dollars at poorer folks to make sure no one falls through the cracks.

There's a consensus in America that every child should get an education, but as David Gelernter noted recently in the Weekly Standard, there's no such consensus that public schools need to do the educating.

Really, what would be so terrible about government mandating that every kid has to go to school, and providing subsidies and oversight when necessary, but then getting out of the way?

Milton Friedman noted long ago that the government is bad at providing services - that's why he wanted public schools to be called "government schools" - but that it's good at writing checks. So why not cut checks to people so they can send their kids to school?

What about the good public schools? Well, the reason good public schools are good has nothing to do with government's special expertise and everything to do with the fact that parents care enough to ensure their kids get a good education. That wouldn't change if the government got out of the school business. What would change is that fewer kids would get left behind.

Jonah Goldberg is editor-at-large of National Review Online, where this article appeared , Wednesday, June 13, 2007

PROSTITUTION INSURANCE ... A Health Care parody

by Arnold Kling

August 3, 2007

Once upon a time in America, an employer came up with an idea for saving on payroll expenses. He noticed that many of his employees seemed uncomfortable with the idea of paying for sex, even though they wanted it. So he tried reducing worker salaries by $1000 a month, and instead he gave his workers an insurance card that they could present to prostitutes whenever the workers wanted their services. Paying for the card cost only $500 a month per worker, so the employer made higher profits.

A few years later, a major war broke out, and the government put limits on worker salaries. Employers were unable to give raises. Instead, many employers copied the idea of prostitution insurance, and the government winked, allowing employers to circumvent the salary limits.

After the war was over and salary limits were lifted, the practice of offering prostitution insurance remained widespread. In part, this was because income tax rates were now higher than they had ever been, and prostitution insurance was an untaxed fringe benefit.

Two decades after the war, a President with a compassionate agenda won a landslide re-election victory. He delivered on campaign promises to use taxpayer funds to provide prostitution insurance to the poor and to the elderly.

Both consumers and the providers of prostitution services became accustomed to using insurance cards. Paying for sex directly was frowned upon as something no decent, middle-class person would do. Instead, the first thing that would happen when a consumer visited a brothel or a prostitute was that the consumer would present his insurance card to be photocopied.

Over time, prostitution became increasingly sophisticated and expensive. Scientists and engineers developed expensive new sex toys, and highly-paid specialists grew to outnumber ordinary general prostitutes.

Nonetheless, not everyone was happy. Some consumers were not employed by companies offering prostitution insurance, nor were they eligible for government-provided prostitution insurance. Sometimes, these consumers would show up at brothels and expect free sex, with the cost shifted to other consumers.

There was a market for individual prostitution insurance, but it never really developed properly. Many consumers were willing to remain uninsured, and insurance companies saw little opportunity to profit from this small market.

The cost of employer-provided prostitution insurance continued to rise. It began to eat up a larger and larger portion of potential salary increases. Both employers and employees became troubled by this trend.

Many people began to agitate for universal, government-provided prostitution insurance, arguing that such systems were working in Canada and in many European countries. Such a single-payer system for prostitution would solve the growing problems of the uninsured and relieve the strains of employer-provided prostitution insurance. Most importantly, it would allow people to continue to be insulated from having to pay for sex.

Unfortunately, shifting the costs of prostitution insurance to taxpayers was fiscally impossible. Prosticare, the government's popular insurance program for the elderly, was projected to run into deficits of tens of trillions of dollars in another 50 years. Forestalling such a bankruptcy was going to require drastic cuts in future benefits. Trying to expand Prosticare to cover everyone would have forced such cuts to take place today, and no politician wanted to risk a confrontation with senior citizens. So although politicians talked a lot about universal single-payer prostitution coverage, they never seriously proposed enacting it.

The American public had grown accustomed to enjoying unlimited access to the services of prostitutes. They continued to be averse to paying directly for sex, and they had become increasingly insulated from having to do so. As a result, America's share of GDP going to prostitution, already the highest in the world, rose rapidly.

A few economists argued that Americans ought to try to get over their discomfort with paying for sex. The economists proposed that Americans pay for prostitution with their own money, in which case they would be less likely to obtain unnecessary services. In addition, consumers would pay more attention to cost, which would force prostitutes to lower their prices in order to avoid losing business.

Most people, particularly prostitutes, were outraged by the economist's suggestions. The idea of paying for sex was too offensive to contemplate. So the existing prostitution insurance system kept stumbling along.

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Arnold Kling is the author of "Crisis of Abundance: Re-thinking How We Pay for Health Care", published by the Cato Institute. The above article appeared in TechCentralStation.com , May 15, 2007

A Republic vs. A Liberal State

By Herb London

July 15, 2007

Ben Franklin when asked to describe the goal of the Constitutional Convention said, "A Republic, if you can keep it." The last five words are critical. For in the succeeding two hundred years the Republic has undergone shifts and dramatic changes. Surely the limited government envisioned by the founders does not resemble the government of today that by happenstance, pandering or addressing real and perceived needs is elephantine.

But perhaps the most significant challenge to a republican form of government is the liberal state that emphasizes rights as its critical feature. Rights tend to be inviolable; moreover, a privilege vouchsafed over several months morphs easily into a right.

Rent control in New York City, for example, proffered as a temporary measure to assist G.I.s returning from World War II, was transmogrified into a right that doesnt make economic sense and certainly has little application to the city 60 years after its introduction.

The liberal state is fond of finding and then defending rights the founders could not possibly have imagined. Reproductive rights, the right to healthcare, the right to marry a member of the same sex are clearly contemporary rights that come to mind.

The problem with newly created rights is that they take on a status like those in the Bill of Rights; they must be defended and applied as if the First Amendment. And there isnt any end to their invention and metamorphosis from idea to privilege to right.

Rights are also universal; they apply to those who pay taxes and those who dont; they apply to new immigrants and the old; they may even be applied to those who arrive on our shores illegally. Hence rights can fundamentally alter the character of a nation, even as we take pride in many rights (individual rights, property rights) as being essential for the continued qualities in our nation.

Republicanism is summarized in three words, "we the people." Our Constitution does not refer to "we the states" or to "a polity." The government presumably serves the will of the people and acts on the consent of the governed. Therefore, rights must be seen against a backdrop of consent. If the people are willing to abjure some rights in order to enhance security, that is their privilege.

Liberalism has so encroached on the essence of the republic that the courts have arrogated to themselves the right to make laws the Constitu