13 November 2009
Today’s Tabbloid
PERSONAL NEWS FOR craig.kirchoff+fisccon@gmail.com
FISCALLY CONSERVATIVE BLOG FEEDS
New Heritage Briefing Book for
Candidates [The Club for
Growth]
NOV 12, 2009 04:55P.M.
The Heritage Foundation has a new briefing book out for candidates,
which is wonderful. This will be an excellent resource for candidates
looking for reliable background material on many important economic
issues. It is also a good one-stop reference for non-candidates too. Here
is a link: http://www.issues2010.com/ Cato has something similar that
can serve as another excellent resource for candidates — their Handbook
for Policymakers, 2009.
http://www.cato.org/pubs/handbook/hb111/index.html
FISCALLY CONSERVATIVE BLOG FEEDS
More on “Race to the Top” [Cato
at Liberty“Race to the Top”]
NOV 12, 2009 02:38P.M.
Andrew Coulson has already touched on this, but I thought I’d throw in
my two cents. “Race to the Top Fund” guidelines were released today and
they should please no reformers. They are simultaneously too weak, and
way too much.
They are too weak because they don’t require states to actually do
anything of substance. Have plans for reform? Sure. Break down a few
barriers that could stand in the way of decent changes? That’s in there,
too. But that’s about it. And the money is supposed to be a one-shot deal
– once paper promises are accepted and the dough delivered, the race is
supposed to be over.
In light of those things, how is this more appropriately labeled the Over
the Top Fund than the Race to the Top Fund? Because while not
requiring anything, it tries to push unprecedented centralization of
education power.It calls for state data systems to track students from
preschool to college graduation. It calls for states to sign onto “common”
– meaning, ultimately, federal – standards. It tries to influence state
budgeting.
In other words, it attempts to further centralize power in the hands of
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ever-more distant, unaccountable bureaucrats rather than leaving it with
the communities, and especially parents, the schools are supposed to
serve — exactly what’s plagued American education for decades. And, of
course, it does this with huge gobs of federal money taxpayers have no
choice but to supply.
FISCALLY CONSERVATIVE BLOG FEEDS
A Georgian Constitution of
Economic Liberty [Cato at
Liberty]
NOV 12, 2009 12:49P.M.
The former Soviet Republic of Georgia is a late economic reformer,
having started such liberalization after the Rose Revolution in 2004. But
it is one of the most successful post-Soviet reformers, and it may be the
country that has implemented the largest range of serious market
reforms in the shortest period of time. Its growth rate from 2004
through 2008 averaged 7.6 percent per year (which includes the
comparatively low 2.1 percent rate of 2008 that resulted from the global
financial crisis and the war with Russia).
Last month, the government submitted a draft act to Parliament that
calls for amending the country’s constitution so that it would safeguard
various elements of economic freedom. The amendments would put caps
on public debt, spending and deficits; and ban any kind of price controls,
state ownership of banks and financial institutions and restrictions on
currency convertibility, and any kind of control over the movement of
capital. New taxes or increases in tax rates would require approval
through a national referendum.
With the possible partial exception of Hong Kong’s Basic Law, I’m not
aware of any other constitution that explicitly enshrines economic
freedom. I’m told by Georgian colleagues that prospects for passage of
the law looks good, with the constitution being amended as early as next
month.
Today’s Tabbloid PERSONAL NEWS FOR craig.kirchoff+fisccon@gmail.com 13 November 2009

FISCALLY CONSERVATIVE BLOG FEEDS caused an explosion of leprosy cases and crime.

Thursday Links [Cato at Dobbs was vague about his plans for the future last night, but there is
some speculation that he will run for office, perhaps for president in
Liberty] 2012. I hope he does. It would be an interesting test of just how popular
NOV 12, 2009 12:22P.M. his sentiments really are among Main Street Americans.

• The War on Terrorism ends; and the winner is… China.

• Fairness Doctrine 2.0: How the government is finding new ways to FISCALLY CONSERVATIVE BLOG FEEDS
regulate media.
Thursday’s Daily News [The
• Don’t miss Cato’s 27th annual Monetary Conference Thursday,
November 19th. Club for Growth]
NOV 12, 2009 10:40A.M.
• New Hampshire state government guaranteeing loans to help bail
out a local newspaper. Harry Reid is prepping a new “jobs bill” for next year. No details yet on
what’s in it.
• Podcast: “Atomic Obsession:” When threats are exaggerated,
what’s the cost? John Mueller, author of Overblown: How National Review: Senate Republicans explain their plans to block
Politicians and the Terrorism Industry Inflate National Security Obamacare.
Threats, and Why We Believe Them, comments.
The Wall Street Journal editorial board writes about the upcoming 69%
capital gains tax hike.

FISCALLY CONSERVATIVE BLOG FEEDS Here are 12 reasons why unemployment is going to (at least) 12 percent.

Good Night, Lou Dobbs [Cato at Trade expert Scott Lincicome writes about “Mercantilist Max” Baucus,
chairman of the Senate Finance committee.
Liberty]
NOV 12, 2009 11:14A.M. A victim of the minimum wage speaks.

In his CNN swan song last night, Lou Dobbs told his loyal if shrinking
audience that important national issues
are now defined in the public arena by partisanship and
ideology rather than by rigorous empirical thought and
forthright analysis and discussion. I will be working diligently
to change that as best I can.
I would argue that his very act of resigning from his prime-time perch is
probably the best contribution he’s made yet to advancing “rigorous
empirical thought.”
Forbes releases its list of the world’s most powerful people.
Economist Steven Landsburg has a brain teaser to make the point that
silence conveys information, silence in the face of silence conveys even
more information, and silence in the face of silence in the face of silence
conveys even more.
Cato’s Gene Healy writes about Obama’s arrogance of power.
Is it the Tea Party vs. GOP incumbent Bob Bennett in Utah?

Since he launched his program “Lou Dobbs Tonight” in 2003, the CNN
anchor has been engaged in one long rant against immigration, free
trade, and other populist bugaboos. His approach was anything but
rigorous and empirical.

In a review of his 2004 book, Exporting America, I critiqued his flabby

reasoning and questionable facts. (My new Cato book, Mad about Trade,
is a painless, one-shot antidote to everything Dobbs has said about free
trade, manufacturing, and the middle class.) The New York Times, “60
Minutes” and other mainstream news outlets have exposed such
outrageous whoppers from Dobbs as his claim that immigrants have

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Today’s Tabbloid PERSONAL NEWS FOR craig.kirchoff+fisccon@gmail.com
FISCALLY CONSERVATIVE BLOG FEEDS
Arne Duncan, Secretary of
Wheel Reinvention [Cato at
Liberty]
NOV 12, 2009 10:12A.M.
The final guidelines for the Administration’s “Race to the Top” education
reform program have now been released. It’s a system that stimulates
competition between the states to produce results that the customer
(Secretary Duncan) wants, using financial incentives. Déjà vu, anyone?
It’s as though Arne Duncan recognizes the merits of free market forces,
but rather than faithfully reproducing them in the field of education, he’s
decided to give us his own reimagining of them.
Here’s the problem. There are already 25 years of scientific research
comparing real free education markets to traditional public school
systems. It overwhelmingly finds that markets do a better job of serving
families. But we have no evidence at all that Secretary Duncan’s newly
invented system will do anyone any good.
So why go to all this trouble to reinvent the wheel, when the Secretary’s
own Department of Education has found that an on-going federal private
school choice program—which gets much closer to a genuine education
marketplace—is raising students’ reading ability by two grade levels after
just 3 years of participation?
FISCALLY CONSERVATIVE BLOG FEEDS
A Red-Ink Train Wreck: The
Real Fiscal Cost of Government-
Run Healthcare [Americans for
Tax Reform]
NOV 12, 2009 09:47A.M.
...
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13 November 2009
FISCALLY CONSERVATIVE BLOG FEEDS
Public Housing for the Dead
[Cato at Liberty]
NOV 12, 2009 09:27A.M.
The HUD Inspector General’s Office released an audit earlier this week
on the department’s progress in making sure local public housing
agencies aren’t subsidizing the deceased. According to the report, local
“agencies made an estimated $15.2 million in payments on behalf of
deceased tenants that they should have identified and corrected.”
The audit found the following “significant weaknesses:”
• HUD and local agencies did not have effective policies related to
deceased tenants.
• Local agencies did not provide accurate and reliable information to
HUD.
• HUD and local agencies did not safeguard assets to ensure correct
assistance payments.
This report is a small illustration of the fundamental problems with the
federal government subsidizing local governments. The local public
housing agencies are supposed to be monitoring how money is spent and
reporting to HUD. HUD is supposed to be monitoring the local public
housing agencies. But no one does a very good monitoring job, despite
the piles of regulations and paperwork that every level of government
has to deal with for such subsidies. The muddled web of responsibilities
also makes it easy for fraud artists to take advantage.
Last week, HUD’s IG reported that the department is sending $220
million in stimulus funds to local agencies already known to misspend
taxpayer dollars.
From USA Today:
The government is sending millions of dollars in stimulus aid
to communities and housing agencies that federal watchdogs
have concluded are unable to spend it appropriately,
increasing the risk that the money will be wasted.
Since July, auditors working for the Department of Housing
and Urban Development’s inspector general have scrutinized
at least 22 cities, counties and housing authorities in 15 states
and Puerto Rico to measure whether they can handle
stimulus funds effectively. Only six, they found, could do so.
The rest — in line to receive more than $220 million in
stimulus aid — had shortcomings ranging from poor
management to inadequate staffing that threatened their
ability to spend the money quickly and appropriately, a series
of audit reports show.
Today’s Tabbloid PERSONAL NEWS FOR craig.kirchoff+fisccon@gmail.com 13 November 2009

According to a HUD spokesperson, the department is “spending millions

of dollars to help local officials spend stimulus money effectively.” Maybe
that’s true, but all monitoring help is a pure loss to taxpayers and the
private sector economy.

Even when the federal oversight does find problems, the money often
keeps flowing anyway. As the article notes:

USA TODAY reported in April that HUD planned to send

$300 million in stimulus money to public housing authorities
that had been repeatedly faulted by outside auditors for
mishandling other forms of federal aid. Congress gave the
Obama administration permission to withhold stimulus
money from some of those agencies, but HUD opted earlier
this year not to do so.

For more on fraud and abuse in federal programs, including housing

subsidies, see this essay.

FISCALLY CONSERVATIVE BLOG FEEDS

TARP Funds To Be Used to

Lower Deficits! [The Club for
Growth]
NOV 12, 2009 08:49A.M.

The Wall Street Journal is reporting that the Obama Administration

wants to use unspent TARP funds to reduce the deficit. Don’t be fooled,
says my buddy Dan Clifton. In an email to me, he writes:

A Wall Street Journal article this morning says that leftover

TARP funds could be used for deficit reduction. Is this really
news? The US government has already issued the debt for the
funds and any unused money would logically be used to retire
that debt. There is about $300bn in unspent TARP funds
now. But none of that can be used as deficit reduction. Why?
Because the money has not been spent yet. And is it really
$300bn? Absolutely not, the administration decided to
change the accounting to a net present value basis. So any
savings would be negligible. The punchline: This story makes
a great headline against the concerns over deficits, but will
have zero impact on debt issuance and the deficit.