Minimum wage hike advocates willfully ignore that minimum wage jobs are low-skill, entry-level positions that help employees transition to higher-earning jobs once they get more experience. Additionally, most minimum wage employees receive a raise within a year. Artificially high minimum wages hurt the people Democrats claim to champion, as they make it difficult for low-skilled workers to enter the workforce.61 It’s misleading to suggest that these jobs, by and large, are for heads of households whose families will starve unless their wages rise.
Progressives have no excuse for their indifference to the likely consequences of their proposals or the economic realities involved. What right do they have to force businesses to lay off workers or cut their hours so they can afford to pay employees more than the economic value they provide? Someone has to subsidize their largesse and, as usual, the American consumers and taxpayers will ultimately bear the cost through increased prices and/or government subsidies.
“I’M GOING TO DO TO YOU WHAT YOU DID TO US”
In their ongoing war against evil capitalists, some vengeful Democrats have their eyes on banks, which they blame for making millions of loans that resulted in foreclosures and the 2008 financial crisis. Never mind that it was progressives who forced the government to make these loans to low-income borrowers with poor credit ratings through the Community Reinvestment Act and anti-discrimination laws. They promoted minority home ownership without regard to the owners’ ability to repay, and the result was catastrophic. But being a leftist means never having to say you’re sorry—just pass a misguided policy and blame everyone else when it predictably fails.
Democratic Rep. Maxine Waters, emboldened by Democrats recapturing control of the House, issued a stern warning to bankers before the 2019 session began. “I have not forgotten” that “you foreclosed on our houses,” she said, and “had us sign on the line for junk and for mess that we could not afford. I’m going to do to you what you did to us.”62 How’s that for good governance—using her newfound power as incoming chairwoman of the House Financial Services Committee to punish bank executives for the disaster she and her fellow Democrats caused? Waters is also targeting corporations for allegedly excluding minorities and women from executive positions. Forming a new subcommittee on diversity and inclusion, she immediately held a hearing to discuss the importance of examining the systematic exclusion of women, people of color, persons with disabilities, gays, veterans, and other disadvantaged groups.63 Why concentrate on policies to stimulate economic growth and improve people’s standards of living when you can employ identity politics to demonize your opponents?
With the subprime mortgage meltdown, we see the same pattern evident with Obamacare: if some socialist or partially socialist program fails, blame it on capitalism and demand more government, just like when the Washington Post risibly blamed the problems of leftist-run San Francisco on capitalism.64 The left’s latest cockamamie healthcare scheme is even more extreme. The Medicare for All Act of 2019, part of the GND package, had 117 Democratic cosponsors as of August 2019. “The bill—which resembles Medicaid more than it does Medicare—would transform our entire health-care system into an iron-fisted centralized technocracy, with government bureaucrats and bioethicists controlling virtually every aspect of American health care from the delivery of medical treatment, to the payment of doctors, to even, perhaps, the building of hospitals,” writes Wesley J. Smith, senior fellow at the Discovery Institute’s Center on Human Exceptionalism. “It would obliterate the health-insurance industry and legalize government seizure of pharmaceutical manufacturers’ patents if they refuse to yield to government drug-price controls.”65 The plan would provide “free,” comprehensive healthcare for everyone. Comprehensive means just that; the list of services, which would make Karl Marx blush, includes primary care, hospital and outpatient services, dental, vision, audiology, women’s “reproductive health” services, long-term care, prescription drugs, mental health and substance abuse treatment, laboratory and diagnostic services, ambulatory services, and more. The estimated cost, as noted, would be $32 trillion over ten years. Meanwhile the current Medicare fund, which is far less ambitious, is scheduled to go insolvent by 2026.
This boondoggle would create a “Physician Practice Review Board ‘to assure quality, cost effectiveness, and fair reimbursements for physician-delivered items and services.’ ”66 Smith notes that the term “cost effectiveness” is simply code for rationing. The measure would prohibit out-of-pocket costs to patients, meaning there would be no private fees allowed for doctors, hospitals, or other service providers, which even the New York Times admits would mostly eliminate health insurance companies.67 That’s the thanks insurance companies get for rolling over for President Obama and his party, whose loyalty lasted only so long as they were useful.
While the bill would not directly make doctors government employees, it would force them to sign a “participation agreement” to be eligible to receive government payments. This agreement, says Smith, would require the doctors to accept the government fee as full compensation for their services, allow the government to inspect their books, and accept government regulations in the future. With no bargaining leverage, doctors would have to comply to continue in their profession. Such is the world of a government-imposed monopoly.
Further, as if the bill’s drafters are trying to showcase their fundamental ignorance of economics and the role of prices, profits, and competition, the bill aims to remove profit in healthcare. It states that “tens of millions of people in the United States do not receive healthcare services while billions of dollars that could be spent on providing health care are diverted to profit. There is a moral imperative to correct the massive deficiencies in our current health system and to eliminate profit from the provision of health care.”68 Under the bill, the government could coopt pharmaceutical patents; illegal aliens would receive free healthcare; and women would receive free abortions.69 As to the funding of abortions, the bill states, “Any other provision of law in effect on the date of enactment of this Act restricting use of Federal funds for any reproductive health service shall not apply to monies in the Trust Fund.”70 Is there any limit to how far Democrats will go to fundamentally transform America?
“ADDRESS THESE FINANCIAL CHALLENGES AS SOON AS POSSIBLE”
President Trump didn’t campaign on entitlement reform, but I trust he realizes major reform will have to occur soon because of the imminent insolvency of both Medicare and Social Security and because these and other entitlements are eating up an increasing portion of our budget. The Social Security and Medicare trustee’s report of 2018 projected that the Medicare trust fund would be entirely depleted by 2026 absent congressional reform of the program.71 Trump and his economic advisers understand that while tax cuts stimulate growth, they must be coupled with spending cuts to ensure long-term fiscal solvency and stability. Mindful of this, Trump’s 2020 budget sought cuts in non-defense discretionary spending by 5 percent across the board, for a total of $2.7 trillion in savings over ten years, and, according to OMB projections, would balance the budget by 2034—obviously not soon enough, which further proves the indispensability of entitlement reform to bringing the budget and debt under control. The proposal would also limit the co-pay for high-priced prescription drugs, which would hopefully result in some Medicare savings, though the budget contains no structural reforms to Medicare.72
Senator Bernie Sanders’s pointed questions to OMB acting director Russ Vought during a Senate Budget Committee hearing exemplify how Democrats demagogue entitlement reform and other responsible efforts to reduce spending. “How many thousands do you think will die because of massive cuts to Medicare and Medicaid?” asked Sanders. Other Senate Democrats also accused the Trump administration of trying to cut Medicare. Vought told them that no cuts were being made but that they were trying to reduce drug prices enough to extend the solvency of Medicare for eight years.
Senator Debbie Stabenow was equally accusatory. “We have t
his outrageous budget in front of us,” said Stabenow. “The administration may claim to care about women and children. There is no way that’s true, obviously.… I don’t even know where to begin with all this. I would suggest that we just throw [the proposed budget] out the window.”73 Republican senator David Perdue countered that posturing Democrats need to look at the reality instead of exploiting people’s emotions, noting that our national debt has increased from $6 trillion in 2000 to more than $20 trillion today and that by 2024 interest payments on the debt would exceed military spending. Contrary to Democratic fearmongering, noted Vought, federal tax cuts are not responsible for the government’s fiscal crisis, as “revenues are increasing and are in line with 50-year historic averages. The problem is not that Americans are taxed too little; it is that Washington spends too much.”74
If Democrats accuse Republicans of killing people for trying to lower drug prices, just imagine their hysteria if Republicans propose meaningful entitlement reforms. Nevertheless, despite the inevitable charges of throwing Grandma down the stairs, Republicans must plead the case for structural entitlement reform to the American people or the nation will experience a severe financial reckoning—in the not-too-distant future. From the leftist perspective this may not be bad news, for the collapse of existing systems often leads to radical change. But for liberty lovers the situation is ominous, for the longer a solution is postponed, the more financial pain will ensue. As the Social Security and Medicare Board of Trustees concluded, “Lawmakers have many policy options that would reduce or eliminate the long-term financing shortfalls in Social Security and Medicare. Lawmakers should address these financial challenges as soon as possible. Taking action sooner rather than later will permit consideration of a broader range of solutions and provide more time to phase in changes so that the public has adequate time to prepare.”75
TRUMP’S ECONOMIC BOOM
Under President Obama, Democrats gave up on substantial economic growth, saying we’d have to resign ourselves to feeble increases. The idea of a new normal of economic stagnation, recurring recessions, and anemic economic growth was invoked by Obama White House economist Larry Summers.76 Federal Reserve officials under Obama told us that 2 percent real GDP growth is “the most likely scenario” for the U.S. economy.77 These declarations were meant as apologias for Obama, who was the first president to fail to deliver a year of 3 percent economic growth.78 His average GDP growth was 1.64 percent.79 The Congressional Budget Office forecasted in 2016 that America would never see 3 percent growth again.80
“High rates of growth, and the productivity that drives it, are likely distant memories from a bygone era,” said bond expert Bill Gross. Similarly, Northwestern University economist Robert J. Gordon stated that the best years are already gone for U.S. GDP. Under the progressives’ vision of government, with increased taxes and spending, increasing regulations and expanding bureaucracy, and more redistributionist schemes, it’s no wonder the economic experts were pessimistic. Hillary Clinton was promising a third Obama term on steroids and had she been elected, she would have imposed further obstacles to growth, resulting in more stagnation.81
But not everyone was prepared to settle for such a dismal economic fate—to accept a future of an America hell-bent on socialism. Rejecting this gloom and doom, Trump took office vowing to reignite the economy, earning condescending ridicule from the mainstream media. “In fact, the only place one can find confidence about a growth rate of 3%-plus is inside the Trump administration, where Treasury Secretary Steven Mnuchin says it’s ‘very achievable,’ ” wrote the Los Angeles Times’ Michael Hiltzik. “But he would say that, wouldn’t he? After all, Trump’s economic doctrine is dependent on it. Without such growth, Mnuchin’s promise that the Trump-backed tax cut would ‘pay for itself’ is a fantasy.”82 Hiltzik should have quit when he was behind, but he dug himself a deeper hole, insisting that Trump’s optimistic forecast could only be realized through growth in labor and productivity. “But unemployment statistics suggest instead that there isn’t much slack in the workforce,” Hiltzik smugly wrote. “At 4.4%, the unemployment rate is at about the point economists judge to be full employment.”83 Hiltzik was just as confident Trump would have no success turning productivity around.
Thankfully, the naysayers lost. Under Trump, wages rose for the first time in two decades.84 In November 2018, unemployment dropped to its lowest rate in a half century. Black unemployment reached its lowest recorded level in May 2018, at 5.9 percent, and unemployment rates for Latino, young, and low-skilled workers are lower than they’ve been in years. Unemployment for Americans with disabilities also reached an all-time low.85 In the same year women’s unemployment reached its lowest rate in sixty-five years. By the close of 2018 there were more job openings in America than unemployed people for the first time in this nation’s history. More than five million jobs had been created since Trump took office.
Most notably, manufacturing industries are booming again, having added 284,000 jobs in 2018, though skeptics had predicted these industries were dead and never coming back. David Urban notes that the elites never seemed to particularly care as the U.S. manufacturing base hollowed out under previous administrations. “It didn’t matter that we strangled our own coal and steel industries with unworkable regulations, the globalists insisted, because we could just import goods from far-flung places,” says Urban. “The underlying message was that there was no point in fighting back and that American industrial decline was irreversible.” By cutting regulations and taxes and confronting international trade cheaters, however, Trump has created a manufacturing renaissance. Urban concludes, “The political establishment initially laughed at Trump when he promised to revive American manufacturing, but now, less than three years later, it’s clear that Trump, and American workers, are getting the last laugh.”86
Our economic freedom has dramatically increased, with America moving from eighteenth place to twelfth in the world on the Heritage Foundation’s 2019 Index of Economic Freedom.87 Progressives absurdly credit Obama for this amazing growth, though his economy was in perpetual stagnation and his experts had resigned themselves to more of the same. Trump, not Obama, is the one who slashed regulations at a record pace and implemented a major tax cut that reduced corporate rates, included a substantial cut for middle-class families, and raised the estate tax threshold to assets exceeding $11.2 million.88 Trump slashed regulations and issued executive orders to improve the regulatory process, including a requirement that two old regulations be removed for every new one. Diane Katz of the Institute for Economic Freedom and Opportunity said the Trump administration “issued 65 percent fewer ‘economically significant’ rules—those with costs to the private sector that exceed $100 million a year—than the Obama administration, and 51 percent fewer than the Bush administration, after 22 months in office.”89
The labor participation rate, which had fallen to the lowest rates since the 1970s under President Obama as people gave up on searching for a job, had created falsely optimistic unemployment numbers at the time. While unemployment continued to plummet to record lows under Trump, as noted, the labor participation rate began to rise and continued to stay at substantially higher levels.90
LEFTIST ANTI-SEMITISM
Leftism and socialism worldwide have a long association with anti-Semitism, and we increasingly see this phenomenon in America today. For example, AOC has established a comradery with Jeremy Corbyn, the leader of Britain’s Labour Party, whose never-ending anti-Semitic statements and associations have sparked a full-blown anti-Semitism crisis in his own party. Corbyn and AOC met and broke bread after which AOC tweeted, “It was an honor to share such a lovely and wide-reaching conversation with you, @jeremycorbyn! Also honored to share a great hope in the peace, prosperity, + justice that everyday people can create when we uplift one another across class, race, + identity both at home & abroad.”91 Dominic Green asks why AOC can get away with endorsing Corbyn with so little blowback. “Corbyn is a career
communist, a supporter of Castro, Chavez, and Maduro,” writes Green. “He is a supporter of Hamas and the IRA. He hates the United States, but he never has a bad word to say about Russia.… He refuses to accept Israel’s right to exist and endorses conspiracy theories about Israeli subversion in Arab states,” and he shares platforms with Holocaust deniers.92
Corbyn returned a fawning tweet to AOC: “Great to speak to @AOC on the phone this evening and hear firsthand how she’s challenging the status quo. Let’s build a movement across borders to take on the billionaires, polluters and migrant baiters, and support a happier, freer and cleaner planet.” Green reports that one of AOC’s Jewish Twitter followers tweeted his distress at AOC’s joining hands with Corbyn, whose reference to “billionaires” could be code for, as Green puts it, “Judeo-American capitalism, whose tentacular global empire uses Israel to forestall the inevitable workers’ revolution in the Arab states.” AOC was quick to respond that she wouldn’t move forward “without deep fellowship and leadership with the Jewish community. I’ll have my team reach out.” Green notes that AOC was “a little wounded” by the suggestion that she could be in league with anti-Semites. “Of course, she couldn’t be,” Green remarked. “She’s far too young and perky for that. It’s just that the company she keeps is that of ‘everyday people’ like Ilhan Omar and Rashida Tlaib—and now Jeremy Corbyn.”93
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