A study at Harvard Business School demonstrates that higher federal spending in a district corresponds with lower corporate spending (via memeorandum)

A number of Council members have blogged about this.

Bookwork Room observes:

Business people understand what liberal policy wonks don’t: all that spending has to be paid for by taxes; all those taxes suck money out of the economy; and an economy with no money is a perilous business environment.

The Provocateur concludes:

The study looked at the last forty years and considered the states in which their Representative ascended to chairmanship of powerful committees. First, the study found that earmarks went up 40-50% and discretionary spending went up by 10% in those states. Meanwhile, private investment, R&D, and sales went down over those same periods. That puts serious cold water to Keynesian theories.

More specifically, The Glittering Eye writes:

In my view that constitutes additional empirical evidence for a Keynesian multiplier of less than one. I’m still waiting for empirical evidence from supporters of fiscal stimulus via deficit spending that measures outputs rather than measuring inputs.

In a later post, The Glittering Eye applies a complementary analysis to the latest report from the CBO.

I concluded that Robbing Peter doesn’t pay Paul.

Note to readers: One idea I had was to get the Council’s view on topics of the day and then publish an exchange of those opinions. In the future these may also take the form of an e-mail chat. Here is our first Council roundtable.

A few weeks ago President Obama announced that he had agreed to an arms reduction treaty with Russia. At the time council member JoshuaPundit expressed his skepticism:

As I write this, the Russians are actively working to get Iran’s Bushehr nuclear plant and a number of other facilities up to speed and blocking any major efforts by the West to stop the Mullahs from getting their hands on deliverable nuclear weapons.

It would seem that cutting back on America’s nuclear deterrent in an effort to stop proliferation is an pretty futile way ineffective way of accomplishing that.

This is eerily reminiscent of the Kellog-Briand treaty in 1929, which featured arms limitations with the idea of ‘outlawing’ future wars. It helped accomplish just the opposite.

Last week another element of President Obama’s nuclear strategy made news. Or more precisely, it was leaked to the New York Times. Secretary of Defense, Robert Gates wrote a memo observing that the United States had no effective mechanism from preventing Iran from becoming a nuclear power. JoshuaPundit once again.

It’s been obvious to me for some time that the Obama Administration not only had no concrete plan to stop Iran from obtaining nuclear weapons but had apparently decided at some point that they could live with a nuclear armed Iran. What that means is that the Israelis are going to have to do the job for their own survival…

Council member Wolf Howling adds a more general critique of the President:

The Obama Administration has countered criticism on this issue by saying that Reagan sought nuclear disarmament. True, but there is a very substantive difference between Reagan the realist and Obama the fantasist. Reagan sought a reduction of arms, not a “world without” nuclear weapons. Reagan wanted to build a defense against nuclear weapons – Obama has reduced funding for such a defense and, indeed, negotiated a new START treaty with Russia contingent on our not pursuing further such a defense. Reagan strengthened our conventional arms – Obama is cutting them.

In contrast to the revelation of the Gates memo, columnist Jim Hoagland lavished praise on President Obama for helping to develop America’s Nuclear Posture Review. I wondered if this was appropriate:

I would assume that the Nuclear Posture review is supposed to be a “professional” document, written by military and strategic professionals. By inserting himself into the document, President Obama has made it a political document.

The effect of these stories is to portray an administration with a utopian view of the world. The council has spoken and it’s worried that implementing this view only serves to encourage our enemies.

Over his career, Jerry Brown has been known for his flaky, leftwing views, earning him the sobriquet Governor Moonbeam. Council alum, Laer Peace (he of Cheat Seeking Missiles) has lately been involved in the Crazyfornia project and has written an op-ed that was picked up by the Washington Times, Jerry Brown, Oil Baron.

When Jerry Brown recently held his first fundraiser as an official candidate for governor, he chose as the venue the Sacramento apartment where he lived the last time he held that office, after famously declining to live in the governor’s mansion. Faced with multimillionaire Republican opponents, Mr. Brown wants to be seen as just a regular public employee, trying to hold his own against tycoons at the top of America’s wealth disparity. While politically expedient, the image of Jerry Brown as everyman is patently false.

Mr. Brown has a lot of money – how much exactly is not public – and unhappily for his environmentalist and global-warming-alarmist supporters, it’s oil money. Even more unhappily for his campaign managers, it’s money that may have led him to an attack against California’s largest employer and a rewriting of state regulations to feather the family nest.

Read the rest or check it out here at the Crazyfornia project.

The Brown family saga reminds that people often get involved in politics, not for the money, but for the connections that can pay off handsomely later.

I do wonder if, after reading this, folks might change that “Moonbeam” to “Oil Slick.”

Charles Krauthammer’s latest column shreds President Obama’s latest foray into nuclear doctrine, Nuclear posturing, Obama-style.

Imagine the scenario: Hundreds of thousands are lying dead in the streets of Boston after a massive anthrax or nerve gas attack. The president immediately calls in the lawyers to determine whether the attacking state is in compliance with the NPT. If it turns out that the attacker is up to date with its latest IAEA inspections, well, it gets immunity from nuclear retaliation. (Our response is then restricted to bullets, bombs and other conventional munitions.)

However, if the lawyers tell the president that the attacking state is NPT-noncompliant, we are free to blow the bastards to nuclear kingdom come.

This is quite insane. It’s like saying that if a terrorist deliberately uses his car to mow down a hundred people waiting at a bus stop, the decision as to whether he gets (a) hanged or (b) 100 hours of community service hinges entirely on whether his car had passed emissions inspections.

Apart from being morally bizarre, the Obama policy is strategically loopy. Does anyone believe that North Korea or Iran will be more persuaded to abjure nuclear weapons because they could then carry out a biological or chemical attack on the United States without fear of nuclear retaliation?

Perhaps it could be read into the President’s policy that he doesn’t trust the United States (or its President!)

It would appear that Dr. Krauthammer and Gov. Palin are on the same page.

As those who have been following the blogosphere know, there’s one other country the President apparently doesn’t trust with nuclear technology. Council Member JoshuaPundit was one of the first to publicize the news that the Obama administration is being quite stingy about allowing Israeli nuclear scientists into the United States for further training.

The latest National Journal bloggers poll results are up, with thoughts from several council members. At issue is the expected voter anger come November and the likelihodd of a Republican takeover of the House. Debbie Hamilton (Right Truth) gets a special mention.

I want to thank James Taranto for his kind mention of my tongue in cheek post suggesting that the Washington Post ought to advocate for the forced purchase of newspapers.

However, I think that he’s making a mistake in his critique. Taranto writes:

This case involved a prohibition against the possession of obscene material, but surely the principle would apply at least as strongly to Gerstman’s tongue-in-cheek scheme of newspaper conscription. Even if the commerce clause authorizes Congress to mandate the purchase of some products, the First Amendment would ensure that newspapers are not among them.

In the case Mr. Taranto’s citing the first amendment issue is whether the government should have the authority to dictate what individuals read or don’t read. My suggestion was only that applying the Washington Post’s principle, the government could coerce individuals to purchase newspapers, not read them. Even if people were responding to the mandate and buying newspapers to line their bird cages they’d still be helping the industry. And they wouldn’t have to read them to fulfill the “federal government’s interest.”

Last week council member, The Glittering Eye had a post Earth needs Women, commenting on a recent report in The Economist about the dearth of women in Asian countries, especially India and China.

He actually had a rather positive observation.

I’ve heard people express fears that the gender imbalance in favor of males in China will lead to a more aggressive, warlike China. I think it’s rather likely to be the opposite. In a Confucian society largely without non-familial social safety nets will parents be inclined to send their sons, their only children, off to war?

Jeff Jacoby today has a column about the same article.

The war against baby girls has spread to South Korea, Singapore, and Taiwan, to the former Soviet republics of Armenia, Azerbaijan, and Georgia, and even to Asian-American communities in the United States. And if you think that the antidote to this “gendercide’’ is modernization, better living standards, and more education, think again.

“It is not the country’s poorest but its richest who are eliminating baby girls at the highest rate, regardless of religion or caste,’’ the Times of London reported in 2007. “Delhi’s leafiest suburbs have among the lowest ratio of girls to boys in India, while the two states with the absolute lowest ratio are those with the highest per-capita income: Punjab and Haryana.’’ Similarly in China, the higher a province’s literacy rate or income per head, the more skewed its sexual disparities.

Another place where there’s an extreme gender imbalance is in the Persian Gulf kingdoms as you can see from this table. It’s been pointed out to me, that in the Persian Gulf, at least some (maybe all) of the imbalance may be due to the importation of foreign workers.

As Watcher, I’d like to keep the blogging world apprised of the activities of the Council members. A number of us are polled weekly by the National Journal. The latest bloggers poll is here. The question were whether passing health care reform will help the Democrats or the Republicans and between Rahm Emanual and David Axelrod, who helps and who hurts the White House.

The following article is crossposted from a Friday Council Member post at The Glittering Eye

In reaction to yesterday’s reports of increasing unemployment, predictably Paul Krugman calls for another, bigger stimulus package:

O.K., Thursday’s jobs report settles it. We’re going to need a bigger stimulus. But does the president know that?

I am an empiricist in these matters as I try to be in much else. One could reasonably argue, since only a minor proportion of the spending passed by the Congress has actually been spent, that the spending has not had a chance to have an effect on employment one way or another but I honestly don’t see how the lack of effect of the relatively small proportion of the whole actually spent constitutes an argument in favor of an additional spending bill. Quite the contrary I think it’s a powerful argument in favor of just letting the actions that have already been taken work their course.

I’ll take this opportunity to repeat the question I’ve been asking on this subject: does anyone have substantial empirical studies that support the idea of the effectiveness of spending as fiscal stimulus? The studies of which I’m aware indicate a multiplier of about .8, which is not particularly encouraging.

Additionally, does anyone have studies which support the idea that the n+1^st dollar of spending has the same or greater multiplier effect that the n^th does? We’ve been engaging in deficit-funded fiscal stimulus of the economy nearly continually over the period of the last fifty years. I think it’s at least possible that it’s running out of steam or has done so already.

I have no predisposition to disbelieve Lord Keynes’s teachings—quite the opposite. When I took economics classes Keynes reigned. However, I do believe that theories proceed from data which proceed from facts rather than the other way around. What are the facts?

Well, at least Dr. Krugman has mollified his language in vilifying members of his own profession who disagree with him:

And as an economist, I’d add that many members of my profession are playing a distinctly unhelpful role.

It has been a rude shock to see so many economists with good reputations recycling old fallacies — like the claim that any rise in government spending automatically displaces an equal amount of private spending, even when there is mass unemployment — and lending their names to grossly exaggerated claims about the evils of short-run budget deficits. (Right now the risks associated with additional debt are much less than the risks associated with failing to give the economy adequate support.)

“Distinctly unhelpful” is a lot better than “traitors” as he called those who voted against Waxman-Markey, the bill that will implement a “cap and trade” system here hoping to reduce carbon emissions.

John Trumbulls Declaration of Independence

On July 4, 1776, American citizens made their Declaration of Independence known to the world. Although the bulk of the document is a catalog of very specific grievances against George III, the document is remembered for its stirring beginning, describing “unalienable” rights inherent in all human beings, as well as describing a government’s role in ensuring those rights:

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.

The enunciation of those core rights — “Life, Liberty and the pursuit of Happiness” — was an almost staggering statement in 1776, when most of the world labored under the rule of despots.

In the 21st century, however, we tend to be rather blase about those same rights. We can no longer envision a world in which citizens had no say in the government, although their (heavy) taxes supported it; in which people were constrained to work in jobs by government diktat; and in which ultimate power rested in the government, not the people. Our representative democracy, coupled with the enormous freedoms of our daily lives, seem so natural, as if preordained. The result of this unthinking acceptance of these rights is that many of us are not even grateful for the blessings they confer, viewing the rights more as burdens, than benefits.

Why do I say this last? Because more and more people resent the fact that one has to work for the basic freedoms the Founders risked their lives to institute. Sometimes one has to fight and die for them. In a life wrapped in comforts (heated and air conditioned homes and cars, endless supplies of food, gadgets for every purpose), we’ve come to the point where we resent even the necessity of working hard and, perhaps, suffering a little to ensure those blessings in our lives.

“But,” I hear you ask, “what about those chickens? Where do chickens come into this?”

Before any feathers get ruffled, let me explain that the chickens I’m thinking of have nothing to do with cowardice. Instead, I’m thinking of the way in which chickens are raised in this country — factory farming versus free range (or cage free).

Factory farmed chickens do not live a good chicken life, and this despite the fact (or, perhaps, because of the fact) that all their basic needs are fulfilled. They are provided with all the food they need, which many might think is a good thing. They are protected from all dangers during the short chicken lives which, again, many might think is a good thing. They are doused with antibiotics to ensure their health. They need not fear any chicken hawks or foxes. Indeed, so protected are they that their beaks and claws are cut off to make sure they don’t injure either themselves or others. They even have private housing, one home per bird, if you consider housing decent when it is a teeny cage in which they cannot move. These chickens exist and are fully cared for, not to fulfill their own chicken destinies, but to enrich the farmer and feed the consumer.

If one were to apply a political-systems label to the factory farmed chickens, one would have to say that they live in a totalitarian state. While their basic needs are fulfilled (food, shelter and even health care), they have no freedom. Each of their liberties is constrained for the benefit of the state. They live, but they live without chicken joy.

Cage free (or free range chickens) live under a very different philosophy. Although they ultimately benefit the farmer and the consumer (with eggs and chicken flesh), the fact remains that, during their lives, they are allowed to fulfill their real destinies as chickens. They wander around, they scratch the ground, they flap their wings. They are fed, but they have to fight with the other chickens for access to the feed. They have access to shelter but, when the hawk comes, it’s their decision (and ability) to seek it. They are not stripped of their beaks and claws because they need those to live a chicken life. The farmer is responsible for protecting them against predators but, given the chicken’s freedom, it’s not always possible. Their lives are a bit riskier but, for chickens, infinitely more fulfilling.

Applying a political-systems label to the free range chickens is a bit more difficult, because they have freedom but (being chickens) no representation. Nevertheless, I’d say that their lives are more akin to the type of democracy the Founders envisioned, because they are given the means to live their lives to the fullest extent but, beyond that, they are subject to minimal farmer control. It is true that they are taxed (the farmer gets their eggs) and that their lives ultimately enrich the state (once they hit the chicken pot), but they are free in chicken terms.

What is so interesting to consider this July 4, half way through the first year of the first (and, one hopes, last) term of President Barack Obama, is what kind of chicken-farmer-in-chief he is turning out to be. Given his propensity for arugula-eating and Whole Food shopping, one would think that he would want to give the American people at least the same benefits he extends to his free range chickens: A fairly safe environment within which free range Americans can live their lives as they see fit.

All signs, though, are that President Obama is trying to turn the American people into caged birds. He wants us neatly boxed up, with the government/farmer dictating every aspect of our lives, right down to ensuring that we are unable to feed, house and defend ourselves without full government/farmer control. As with caged bird chickens, the American citizen lives to serve the American state not (as the Founders demanded) vice versa.

The whole foodies constantly remind us that this totalitarian regime is bad news for chickens. I would argue that it’s also bad news for Americans.

So this year, as you go to your fairs, watch your parades, have your barbeques, and delight in fire works, think about what the Declaration of Independence really means, and ask yourself this question: Do I want my government to give me more rights than the average chicken? If your answer is yes, spend the next year working hard to effect a change in the 2010 elections, and an Obama ouster in the 2012 elections.

This article is crossposted at Bookwormroom!