During his first term, Donald Trump signed a bill significantly reducing corporate tax rates and lowering personal income tax liability for most Americans. He has promised to further lower income tax rates for corporations and individuals in his forthcoming second term.
This has provided the opportunity for Democrats and other opponents of tax reductions to make the perennial claim that tax cuts signed by Republican presidents have and will continue to blow up the national debt. This claim is demonstrably false.
There are some economic issues that provide room for argument depending upon which economic school one adheres to. However, this issue is not debatable. No tax cut signed by a Republican in the past fifty years has increased the debt more than it would have otherwise increased had the tax cut not been implemented.
It’s easy to understand why the public believes this superficially plausible claim. If the government is running deficit X under the current tax schedule and that tax schedule is reduced, the government will collect less revenue and the deficit will increase to X + less revenue collected. It makes perfect sense.
The only problem is it has never been the case that the government collected less revenue after a Republican tax cut. Never. Ever.
Don’t take my word for it. Just look at tax receipts. Since this tax cut/debt fable began during the Reagan years, look at tax receipts after the tax cuts he signed. They increased so significantly that by his last year in office the government was collecting almost double the amount of taxes it was collecting in Carter’s last year.
While this may seem counterintuitive, it is nevertheless true. The explanation probably lies in what has come to be known as the “Laffer Curve,” named after economist Art Laffer. This theory also has its own little Democratic Party myth built into it. Democrats like to claim Laffer was wrong when he said “tax cuts pay for themselves.” This myth is wrong in two ways.
In 2016, Donald Trump shocked the world. With no political experience whatsoever he ran for president and defeated two political dynasties, the Bushes and Clintons, in the Republican primary and general election, respectively.
Trump came out of nowhere and took the bipartisan ruling establishment completely by surprise. At first, they ridiculed him, Huffpo going so far as to relegate any articles about his campaign to the Entertainment section.
However, it didn’t take long before they recognized Trump was a credible threat not only to the Republican Party side of the establishment, but the whole, corrupt, globalist cabal. That’s when they began demonizing him. And once he won the presidency, the establishment committed itself to two objectives:
Neuter his presidency to the best of its ability with investigations, impeachments, and resistance to his directives by the executive branch bureaucracy and,
Make sure electing him or anyone like him could never, ever, happen again.
And so, the public was regaled with anti-Trumpism nonstop, during and after his presidency, for eight straight years. Trump and his supporters weren’t the only victims of this psychological waterboarding. Tens of millions of American liberals became consumed with irrational fear planted in their psyches by the media that Trump would “end democracy” and replace it with 1930s-style fascism a la Hitler or Mussolini.
Even after Trump’s first term, during which none of this happened, liberals as high profile as actor Robert De Niro truly believed they would be in physical danger were Trump to be elected again. Certainly, Trump made the media’s job easier with some of the undisciplined things he said, but no one can point to any overt act of his as president that remotely justifies this animal terror.
What would motivate the political establishment to go this far, to demonize one half of the electorate along with their candidate, and to inflict psychological terror on the other half? To go so far as to prosecute Trump in multiple jurisdictions on spurious charges even after he secured the Republican nomination?
“Trump Ratchets Up Threats on the Media” reads a New York Timesheadline this morning. It refers to Trump’s suggestion that CBS should lose its broadcasting license over its editing of an answer Democratic Party nominee Kamala Harris gave to a question during her recent 60 Minutes interview.
During the interview, Harris was asked pointedly whether the U.S. government has any sway over Israeli Prime Minister Netanyahu given the massive financial support it has given him in fighting Hamas. Based upon footage 60 Minutes released to Face the Nation, Harris responded with one of her signature word salads that failed to answer the question. However, what aired on the 60 Minutes broadcast was a succinct, one sentence answer that also failed to answer the question or really mean anything at all, but which made Harris appear less like the babbling nonentity her detractors say she is.
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Whether the edit was intended to help Harris or not is anyone’s guess. Of course, CBS denies its edit was misleading or so intended. And while Trump’s general complaint that the media treat him and his campaign with a completely different standard than they do Harris and hers, the 60 Minutes interview of Harris did not come off that way at all. Interviewer Bill Whitaker asked Harris challenging questions and pressed her with follow-up questions when her answers were unclear.
While Trump and his supporters have every reason to suspect there may be footage even more damaging to Harris than what was aired on the 60 Minutes broadcast, the interview was nevertheless a train wreck for Harris. The real question here isn’t whether CBS violated FCC regulations and should therefore lose its broadcasting license. It is, “Why is there a five-member board of bureaucrats who can make this decision at all?”
Trump and his surrogates have said things encouraging to libertarians and terrifying to the media about their supposed intention to dismantle the administrative state. In a video speech, he Trump promised to “dismantle the deep state and reclaim our democracy from Washington corruption.”
Those words in a vacuum would suggest he had a plan to undo the unconstitutional transfer of legislative power from Congress to the executive, born in the early Progressive Era and institutionalized by the New Deal, as well as reclaim executive power also usurped by federal agencies. However, what follows during the speech significantly waters down the promise of its opening statement.
Another presidential election is upon us and, as usual, there is really no way to avoid it. Less than three weeks from today, either Kamala Harris or Donald Trump will begin preparing to assume the most terrifying, destructive power the world has ever known. And regardless of which one wins, the relentless destruction of our lives, liberties, and estates will continue.
The one thing we can look forward to after November 5 will be the temporary cessation of ritual election year slogans blaring at us from every corner of the media sphere. It isn’t merely that these slogans are hysterical and dumb. They are mostly completely wrong.
Let’s take one we hear every presidential election year that no one seems to question: “We need a president who will unite the country.” Heated arguments occur between pundits over which candidate is more “divisive” and even supporters of a candidate will say he is better but reflectively ask, “Can he unite America?”
If anyone has any idea what this means, then please tell me. I have none. It seems to suggest that 330 million people are all supposed to either believe the same thing or pretend they do. It is suggested there is some common thing these 330 million are working on that will benefit them all equally if only the right dear leader would show them the way.
The truth is the whole “unite the country” premise is wrong. It’s the opposite of the truth. A free country is one where people are left alone by their government to pursue their very separate interests. It is that from which all good things come as Adam Smith so astutely observed during the USA’s birth year. The only time the whole country is united behind a president is during a war. And those are all disasters.
A related sophism is the hackneyed refrain about the president “moving us forward.” Every presidential candidate promises this and virtually no one stops to ask what it means. It is just another variation on the theme that “we” are all working on some project vital to each and every one of us. What that project is I have no idea. This one employs fictional start and end points as metaphors for achieving this great work.
Most people, when not under the spell of these incantations, are working on their own lives, taking care of their own families, and at most helping make their own communities a nicer place to live for themselves.
And that’s perfectly ok. That’s what they’re supposed to be doing. History shows that leaving them alone to do precisely that makes the whole world better for everyone.
Mao Zedong had everyone united and working on the same project, whether they liked it or not. About fifty million of them ended up dead. Do you know what his project was called? The Great Leap Forward. I kid you not.
Really, as soon as a politician utters the word “we” or “us,” you should be suspicious. Nothing good ever follows. When you hear the words “move forward,” run like hell. Or prepare to defend yourself.
Then there is the perennial call for a president who can “get things done.”
“Dow closes at record high after blow-out jobs report” proclaimed NBC News on Saturday. It is not surprising the story would ignore all historical perspective, even history within the past few months. Incumbent presidents routinely take credit for job creation during their administrations and the gullible American public largely believes them. Perceived as prospectively continuing the policies of the Biden administration, good news from the jobs report helps Kamala Harris’s election chances.
It isn’t just ignoring that only two months ago, the Bureau of Labor statistics revised downward their previously reported number April 2023 – March 2024 by over 800,000 jobs (around 27 percent)*. It’s the surreal practice of even talking about supposed job creation over the past four years as if most of it weren’t just recovering jobs lost during the 2020 Covid lockdowns.
During March and April of 2020, the BLS reported net job losses of almost 22 million. Of course, these were not the type of job losses sustained during the 2008 financial crisis. These were people ordered to stay home by the government as part of a suite of responses to Covid that did nothing but harm.
As people were allowed to go back to work, there were several months for which the BLS reported millions of “jobs created.” But everyone understood these were mostly just people previously ordered to stay home returning to work. At least while Trump was still president.
But once Joe Biden was inaugurated, the national media started ignoring that reality and treating higher than usual jobs reports as vindication of “Bidenomics.” The truth is it took years just to recover the number of jobs lost during March-April 2020. The 22 million jobs reported lost during that period were not added back until September 2022.
That’s 31 straight months of zero jobs created on net while millions of undocumented mouths to feed entered the country. That is an economic blow the likes of which modern Americans have never experienced in their lifetimes. And the problems it created were by no means solved after September 2022 when the economy finally began adding new jobs on net. One cannot just start counting jobs created after September 2022 as “net jobs.” One also has to recognize the opportunity costs of the lockdowns.
No one has done more to secure free speech in the United States in the past several years than Elon Musk. By buying X, the social media platform formerly known as “Twitter,” Musk has provided a platform where content that would be banned or suppressed in virtually every other online space, including Twitter before Musk owned it, can be shared freely among subscribers. That alone is a great service to this country.
But both he and Tucker Carlson do Americans a disservice when they argue “free speech is essential to democracy.” It is not. Free speech is essential to individual liberty, not democracy.
The First Amendment to the U.S. Constitution protects free speech from the democratically elected Congress. Implicit in its protection is the idea that democracy is a danger to liberty in general and free speech in particular. Indeed, the entire Bill of Rights, along with all the so-called “checks and balances” (bicameral legislature, presidential veto, etc.) are there to protect us from democracy.
Musk’s own tweet of Tim Walz’s comments about free speech should make this clear to Musk. Democracy is what made Walz the Governor of Minnesota and the Democratic Vice Presidential nominee. It obviously wouldn’t protect us from Walz’s implied suppression of free speech should he achieve federal office. The anti-democratic First Amendment would.
This has nothing to do with the technical distinction between “a democracy” and “a republic,” either. Imagine a system where the people democratically elected representatives and those representatives could do anything they wished as long as they executed the will of the majority. That would be a republic, and it would be every bit as dangerous to liberty as a pure democracy.
That seems to be the system both Elon and Tucker have in mind when they refer to “democracy” and the importance to it of free speech. But it is not the system created in either the U.S. Constitution or any of the state constitutions. In all of those, the will of the majority is limited and not by their republican form but by their limits to the power of the government, regardless of the wishes of the majority.
Former President Donald Trump has survived yet another assassination attempt less than two weeks after a judge postponed his sentencing on thirty-four felony convictions related to hush money paid to Stormy Daniels. For the moment, all obstacles to Trump standing for the November presidential election seemed to be cleared away.
Trump’s supporters are reeling from what they perceive as the unprecedented assault on America’s republican norms. That’s understandable given the relative stability of electoral politics in the decades before Trump came on the scene. However, those of us who grew up in the 1970s remember the assassination attempts on Presidents Ford and Reagan just a few years after the successful assassinations of both President John Kennedy and his brother.
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People of my generation considered being shot at a normal part of the job for U.S. presidents and presidential candidates.
Nor are deep state machinations to remove a sitting president anything unprecedented. President Nixon was removed from office by a Naval intelligence officer posing as a reporter working with the number two man at the FBI. As with Trump, the media dutifully swayed the public against the popular president for reprisals that would be considered minor today, post-Snowden.
But many Americans believe something is fundamentally different about today’s Democratic Party establishment. Even some prominent Democrats see the party as breaking from its core values by repressing speech and undermining the democratic primaries to install Kamala Harris as its nominee.
Ironically, the truth is stranger than this fiction. The progressive movement has always been authoritarian, anti-democratic, and reactionary.
Since “save our democracy” is the call to arms (literally, for some of its deranged supporters) of today’s progressives, let us begin with progressivism being anti-democratic. Since the beginning of the movement, when it was led by Republicans, progressives have attempted to transfer power away from elected assemblies and to unelected bureaucrats or judges.
This began with the Interstate Commerce Act of 1887. Although passed by Congress, it empowered an unelected board of commissioners to both set rates and conduct quasi-judicial proceedings to settle disputes. It set the precedent for Congress to unconstitutionally transfer both its own exclusive power to legislate and the judicial power to the executive.
The New Deal massively expanded on that precedent in creating myriad executive branch regulatory agencies that effectively usurped most legislative power from the elected Congress. This trend has metastasized ever since. Thus, when President Biden wanted to mandate Covid vaccines, he didn’t even bother to approach Congress. He went straight to a regulatory agency of unelected bureaucrats and directed it to write a new rule. No democracy needed.
Throughout the 20th century, progressives were fervent supporters of Supreme Court decisions that similarly usurped legislative power from the elected Congress. Where the Constitution clearly required an amendment for the federal government to exercise a new power, the unelected Supreme Court dutifully found that power hiding between the lines. This was just another way to avoid putting progressive ideas to a popular vote.
None of this is to say democracy is any guarantee of individual liberty. But it is preferable to the autocratic rule of an unelected oligarchy.
As far as being authoritarian, all political movements suffer from that defect, but the progressive movement particularly so. Apart from the obvious enormities of jailing journalists and political opponents during WWI and imprisoning Japanese Americans in concentration camps during WWII, progressivism is more fundamentally authoritarian in its modus operandi for achieving all its societal goals. Without exception, progressives seek to forcibly override the personal choices of individuals and replace them with regulations imposed by the state.
Where Thomas Jefferson famously defined liberty as “unobstructed action according to our will within limits drawn around us by the equal rights of others,” Woodrow Wilson took a perverse turn on the “unobstructed” idea. In The New Freedom, he answers the question, “What is liberty?” as follows:
“You say of the locomotive that it runs free. What do you mean? You mean that its parts are so assembled and adjusted that friction is reduced to a minimum, and that it has perfect adjustment. We say of a boat skimming the water with light foot, “How free she runs,” when we mean, how perfectly she is adjusted to the force of the wind, how perfectly she obeys the great breath out of the heavens that fills her sails. Throw her head up into the wind and see how she will halt and stagger, how every sheet will shiver and her whole frame be shaken, how instantly she is “in irons,” in the expressive phrase of the sea. She is free only when you have let her fall off again and have recovered once more her nice adjustment to the forces she must obey and cannot defy.
Human freedom consists in perfect adjustments of human interests and human activities and human energies.”
Where Jefferson saw government as the obstructor of liberty, Wilson saw it as the “adjuster” of human activity. This “adjustment,” of course, is regardless of the individual’s will or rights. Only by allowing the government to adjust your activities can you truly be free.
Monstrous.
That progressivism is reactionary would probably surprise Americans the most. But it is nonetheless true. Calling the movement “progressive” follows the proud American tradition of giving your party or movement a name opposite to its nature. The Federalists weren’t in favor of federalism; they were nationalists. The Anti-Federalists were in favor of federalism. The Whig Party were quite the opposite of the British party after which they were named. And progressivism isn’t about progress; it’s about returning to an earlier, illiberal past.
Equity markets continued to sell off on Monday prompting continued calls for the Federal Reserve to cut interest rates in September. Combined with the dismal jobs report on Friday, the selloff has also soured the outlook for a “soft landing.” Economist Mohamed El-Erian echoed the opinions of many others that the Fed held interest rates too high for too long, thus failing to prevent a recession and sharp stock market correction.
Putting aside the free market objections to the Fed being involved in manipulating interest rates – or existing at all – this analysis is useless at best for several reasons.
First, Fed rate cuts always come “too late” in the business cycle to prevent market crashes and recessions. Looking back at Fed open market operations history, one can see that even when the Fed had been cutting rates for over a year, as it had been prior to the 2008 crash, it did not prevent the bubble it had previously blown up from popping.
There are several reasons why the Fed will always be “too late.” The first is fundamental. While the Fed is holding interest rates artificially low, malinvestment is occurring. Capital is being directed towards projects that aren’t really profitable at market interest rates. These can include unwarranted expansion of otherwise profitable business ventures or capitalization of projects that shouldn’t be launched at all (see “Pets.com” from the 2000 dotcom crash).
At some point, the reality of unprofitable investments fueled by unsustainable debt asserts itself and those malinvestments must be undone. The market overcomes the efforts of the Fed and liquidates unprofitable ventures, unsustainable debt, and, unfortunately, millions of jobs that never should have been created in the first place. All of the above must be redirected towards better use, which takes time. That period of reallocation is called a recession.
It should be noted that even the Fed’s efforts to avoid recessions with monetary policy are wrongheaded. What it attempts to do with interest rate policy and monetary inflation is keep inefficient, unprofitable businesses alive. These are sometimes called “zombie companies” because they aren’t really viable going concerns. They are only able to keep operating because the Fed creates conditions under which they can borrow money at artificially low rates.
Regardless, economic laws are like forces of nature. They always win in the end, often immediately after supposed experts announce their demise. Recall Fed Chairman Ben Bernanke’s 2008 reassurance that “subprime is contained” or President Bill Clinton’s triumphant 2000 declaration that “we’ve ended the business cycle.”
This time around, Fed rate cuts may have even less chance of achieving the mythical “soft landing.” That’s because part of what used to be part and parcel of rate cuts has already been done, namely monetary inflation or as it is now euphemistically called, “quantitative easing.”
Prior to 2008, the Fed achieved rate cuts by purchasing government debt securities in open market operations. This simultaneously added new dollars to the economy and drove down interest rates. The latter was simply supply and demand. A greater supply of money meant its price – interest rates – declined. Conversely, when the Fed wanted to raise interest rates, it sold securities to its member banks, decreasing the supply of money.
Since the 2008 crisis, the Fed doesn’t manage interest rates that way anymore. Because its member banks built up huge deposits at the Fed, for which the Fed paid them interest, it could now manipulate interest rates by simply changing the rate it paid its member banks. This effectively separated interest rate policy from the creation of new dollars or the destruction of existing ones.
The Fed’s response to the 2008 crisis was twofold. It forced interest rates down to near-zero by lowering the rate it paid on deposits and added trillions of new dollars to the economy by purchasing government and mortgage-backed securities. It promised at the time to unwind the vast expansion of its balance sheet – from less than $1 trillion to over $4 trillion – when the “once in a lifetime crisis” was over.
But after unwinding only a small fraction of that increase 2018-19 coupled with modest interest rate increases, the Fed increased its balance sheet to just under $9 trillion and took interest rates back to the zero bound in 2020.
This is where it gets complicated. Conventional wisdom says the Fed began “tightening” in 2022 with the first in a series of interest rate increases in March and reduction of its balance sheet later in the year. Indeed, the Fed did eventually raise the federal funds rate to over 5% (where it remains today) and reduce its balance sheet from a peak of $8.9 trillion to about $7.2 trillion as of this writing.
However, the balance sheet reduction is not the tightening it appears to be. That is because even though the Fed has reduced its balance sheet and the M2 money supply has decreased slightly from its 2022 high, a “stealth easing” has been occurring that no one is really talking about.
Ten days ago, President Biden was adamant he would be the Democratic Party’s nominee for president and defeat “threat to democracy” Donald Trump. Trump was still promising to “drain the Swamp” in Washington, D.C., expurgating DEI and critical race theory from federal agencies, deporting illegal aliens who entered the country in record numbers during Biden’s administration, and end the Swamp’s proxy war against Russia in Ukraine.
As of this morning, Biden is out of the race and out of sight and mind. The Democratic Party’s national media is already in high gear promoting Kamala Harris. And Trump, following an assassination attempt by yet another “lone gunman,” has been brought to heel.
The only thing unprecedented about Biden’s decision not to seek reelection is its timing. Lyndon Johnson similarly announced he would not seek reelection in 1968 – only one of many similarities between this year and that one – but he did it far earlier in the year. That gave the Democratic Party much more time to select and rally around a replacement candidate, albeit in an unsuccessful effort to hold onto the White House.
The change in Trump over the past ten days is much more striking, if unreported. It is understandable that Trump was shaken by the assassination attempt. That explains the lack of fire in his voice while delivering his acceptance speech at the Republican National Convention just a few days later. But what is of much greater significance was the content of the speech, not the style.
Trump said himself that he completely threw away the speech he intended to give at the RNC and now would deliver one centered around national unity. Since the acceptance speech, he has disavowed Project 2025 as a product of the “extreme right,” attempting to position himself as a moderate.
He may not have used that word, opting for “common sense” instead, but what else could it mean? If there is an extreme right that he says he is not a part of, then what else could he be but a moderate? Rumors that his campaign is already second guessing the selection of J.D. Vance as running mate due to the liability of his “extremist” positions only further confirms that Trump has been effectively neutered by the assassination attempt in terms of any threat he may have posed to the establishment.
Don’t forget that Trump’s ideological difference from the establishment was always greatly exaggerated. He never questioned the existence of a global standing army, just that it shouldn’t be used so often and for such insubstantial benefit. He promised “not to touch” Social Security and Medicare, which together with the military comprise about two thirds of federal spending.
He claimed to have cut regulations significantly during his first term but did not fundamentally threaten the New Deal regulatory bureaucracy in any way. Even years into his presidency, prior to the Covid pandemic, nothing much had changed. And in 2020, nothing changed for the better.
A Trump now positioning himself as even more moderate than the Trump of his first term is not going to get the job done. Project 2025 may be “extreme,” but extremism is just what is needed right now. There is nothing moderate about the left’s program. They swing for the fences during every at bat and have rarely struck out during the past several decades. If the juggernaut is going to be stopped it won’t be by a president seeking to “unite the country” and meet far left extremism with “common sense.”
Every newsworthy event prompts a narrative from imperial media and the Trump assassination attempt was no different. Rather than do what journalists purport to do, which is subject public officials to the blinding light of scrutiny, they immediately went into narrative mode. And the narrative chosen for this event was clear: free speech is dangerous.
There are various strains of this message. Some particularly TDS-affected propagandists have tried to blame Trump himself for the attack, saying it was his “extreme” political rhetoric that “raised the temperature” and somehow resulted in a 20-year-old malcontent deciding to shoot him.
Republicans dismiss this theory, of course, saying it has been the left’s nonstop demonization of Trump for the past eight years that drove the shooter to murder and drove thousands of more “mostly peaceful protestors” to loot, pillage, and occasionally assault or kill innocent people.
While the Republican version is more superficially plausible, it still rests upon the same assumption: that people using nothing more than words are somehow responsible for the immoral actions of others. This false premise cannot be allowed to stand.
Every individual is responsible for his own actions. Once you abdicate that position and place the responsibility for one person’s actions on another’s words, you no longer have a free society. You have agreed in principle that people in general cannot be allowed to be free; that there are some words or phrases they must not be allowed to hear. Thus, there are some words and phrases others may not be permitted to speak.
For all their talk about “democracy,” this has always been the fundamental premise of the progressives. They believe most people are incapable of self-government. They were much more explicit about it during the early Progressive Era when they were openly eugenicist. Today, those same instincts are simply clouded in euphemism and doublespeak.
They are all for “free speech” if it doesn’t threaten their rule. They are all for “democracy” as long as the right leaders are elected (here as well as abroad). Consider how absurd it is to suggest “democracy” must be saved from the candidate who gets the most votes. They say it and many still nod their head in agreement.
They don’t really believe the commoners are capable of managing a single aspect of their own lives. All must be “regulated” by the elite. And there is nothing more vital to regulate than what the commoners are allowed to hear, say, and think. This is why the media come on so strong and why people are deplatformed on the internet. Compelling the right thoughts is literally the entire basis of the establishment’s rule.
Enough people thinking the wrong thoughts could end it overnight.
