America and the Value of 'Earned Success'

I learned to appreciate the American free enterprise system by quitting a job in Spain.

At age 19, I dropped out of school to pursue a career as a French horn player. After a few twists and turns, I wound up in the Barcelona Symphony, which was a Spanish government job.

Even as a foreigner, I had the same lifetime work status as a clerk at the water department. Nobody ever left these jobs, except with lavish disability packages. (One colleague who injured his lips moonlighting at a dance-hall gig ended up spending the next 20 years collecting a full salary to stay home.)

I loved music—but the life of a government functionary wasn't my cup of tea. And so my Spanish wife and I decided to pull up stakes and start over in America. Neither of us had a college degree, and my wife's English was limited. Arthur C. Brooks - Wall Street Journal - Click To Read More

Mr. Brooks is president of the American Enterprise Institute and author of "The Road to Freedom: How to Win the Fight for Free Enterprise," published this week by Basic Books.

And So Goes France...

"Each country has a soul and France's soul is equality." Francois Hollande

Francois Hollande in a 51.7% win over the incumbent Nicolas Sarkozy has been elected President of France proving once again the French Revolution is alive and well.

Running on a Socialist platform of raising the top tax bracket to 75% for people earning more than 1 million a year from 44%, Mr Hollande has shown that his party's view of equality is somewhat one sided. In a country where the unemployment rate is 62.8% and the debt to GDP ratio has risen from 59% a decade ago to 90% this year, the French have shown to themselves and the world that the financial stability of France simply does not matter and the bitter pill of austerity will not touch their lips.

Appeasing the French by a pledge to withdraw troops by the year end, Mr. Hollande also is promising to force banks to increase corporate taxes on lenders.

Hollande's rival Nicolas Sarkozy was able to limp out of France's 2000 economic recession but left France saddled with debt. Sarkozy reliance on government debt, bank and industry intervention and preserving the country's generous social welfare system will only be enhanced under Hollande's tenure.

The French chose Mr. Hollande amid an election fueled by concerns over national sovereignty. He is the first Socialist in 17 years to win a mandate to challenge Germany's Angela Merkel and the European Central Bank's ideas to impose spending cuts to repair indebted European countries.

La Bonne France; An Impossible Election

And how will France get out of its debts? Not through a more productive private sector and a more frugal public one, but in a flood of ever-cheaper currency, courtesy of a pliant ECB. That's something on which both Mr. Sarkozy and Mr. Hollande firmly agree. Inflation is the windy updraft the falling man often mistakes as a force more powerful than gravity.- Bret Stephens

If you are following Sarkozy, Mr. Hollande and Marine Le Pen in France's Sunday election, you have become aware of of the electoral menu of quasi-fascism, quasi-Marxism, soft socialism and the bouillabaisse ideology of a failed and desperate country. 

The unemployment rate in France is 62.8% and the debt to GDP ratio has risen from 59% a decade ago to 90% this year. It spends more than any other developed country (28.4%) of it's GDP on welfare payments. Think of innovation? The last thing on France 's mind is producing a climate where a Steve Jobs or Mark Zukerberg could flourish.

Will the confused French voters turn out for this election? Possibly not. With too many choices it may simply become a C'est la vie moment.

California Dreaming. Will The Last Person To Leave Turn off The Lights?

"It's "a very scary political dynamic. One day somebody's going to put on the ballot, let's take every penny over $100,000 a year, and you'll get it through because there's no real restraint. What you've done by exempting people from paying taxes is that they feel no responsibility. That's certainly a big part of it.

Joel Kotkin, leading U.S. demographer and U.C. Berkeley graduate, goes on to say; "these upwardly mobile families are fleeing in droves. As a result, California is turning into a two-and-a-half-class society. On top are the "entrenched incumbents" who inherited their wealth or came to California early and made their money. Then there's a shrunken middle class of public employees and, miles below, a permanent welfare class. As it stands today, about 40% of Californians don't pay any income tax and a quarter are on Medicaid.

If you care at all about what has happened to the predictable outcome of California read Victor David Hanson's great piece "Two Californias."

Taxing the rich: Not as easy as it sounds

Announced in 2008 and implemented in fiscal 2010-2011, the British government imposed a substantially higher marginal tax rate on the country’s top 1 per cent of income earners, raising the rate from 40 per cent to 50 per cent, and simultaneously revoking the personal exemption traditionally granted to all taxpayers.

The London-based Institute for Fiscal Studies, an independent research organization, calculated that the higher rate was originally expected to transfer £3-billion ($4.7-billion) from the top 1 per cent to the bottom 99 per cent. It didn’t come close. Neil Reynolds - The Globe And Mail - Click To Read More...

Ahh... The arrogance of government. Mr Reynolds goes on to say,

The British experience suggests that, when marginal tax rates hit 50 per cent, people find ways not to pay.

Yeah, by not working. A recent study done suggest that 50% is about all the government can hope to get from the taxpayer. It's all very cynical and it's not like the government is keeping a real tab on things. - DSMW

Think Of QE3 As Your Friend

Inflation, not artful government policy, will pull us out of the financial hole we are in. When Bernanke speaks of a new QE3 don't flinch. It's really the only way out and the Fed knows it. When debt is the issue, massive debt, the kind that has been accumulated over the last two administrations kind of debt, taxing the rich and trimming the budget just doesn't cover the shortfall.

The Fed is not waiting for the rest of government to develop a fiscal policy that can restore financial sanity. Bernanke is expanding monetary policy in an effort to get the nation’s finances at the federal, state and local levels back into balance with expected revenues, including trillions in unfunded entitlements and mandates. Because of the sheer magnitude of this task and a lack of political will to do so, it’s unlikely this can be accomplished through growth and cost-­cutting. So the Fed has settled upon inflation as the remedy.

Inflation is well-known for its long-term corrosive effects, but few ever speak of inflation’s short-term benefits. Inflation robs from those with wealth to benefit those with massive debts, such as Uncle Sam and states like California, New York and Illinois.

Inflation is really a necessary evil and it will come as night follows day. So disregard what Ron Paul says and go out and buy some cheap property to rent, investigate some inexpensive stable ETFs and at a minimum buy that painting you have had you eye on. 

Kennedy's Grace Under Fire: One Story From The Supreme Court

It was vaguely menacing, and it garnered broad criticism. In the press it was characterized as a "brushback"—when a pitcher throws the ball close to a batter's head to rattle him, to remind him he can be hurt. Peggy Noonan's remarks about Obama's veiled treats to the Supreme Court on their upcoming healthcare decision.

If you do not subscribe to the Wall Street Journal, Peggy Noonan's Op-Ed piece on how Kennedy handled a Supreme Court decision is worth giving them your e-mail address for a free subscription. If you give us your e-mail address, we will buy a 6 month subscription to the Journal for you.

John Kennedy, when handed a decision from the Supreme Court regarding the sensitive subject of denying prayer in school, explained that the American people would now have to "pray at home." Kennedy, at that moment, expressed to all Americans the intelligence, grace and respect for the judicial system these few well crafted words brought. It elevated him in the eyes and hearts of Americans everywhere. - DSMW

Wait And See How Flexible Obama Will Be

As Bob Hope and Bing Crosby observed in "The Road To Bali":

"He gets his shirts straight from Paris

Cigarettes from the Nile

He talks like a highbrow

But he plays Chicago style..."

I've no idea where President Barack Obama gets his shirts and smokes, but he certainly talks like a highbrow, sufficiently so to persuade presidential historian Michael Beschloss to pronounce him the day after the 2008 election "the smartest president ever." Yet, in the end, he plays Chicago style. You can take the community organizer out of Chicago, but you can't take the Chicago out of the community organizer. Or as the Agence France-Presse headline put it, "Combative Obama Warns Supreme Court On Health Law." Mark Steyn - Orange County Register - Click To Read More...

Barack Obama: Say Hello To My Little Friends

Socialism and the Democratic party have deep roots in this country. Spread the wealth under the guise of social programs is their platform. After listening to the Supreme Court last week fight for your rights as a citizen, do not forget this very simple fact, that there is a very real battle for your freedom going on. What you have you will not be entitled to keep if this President and his liberal administration have their way. - DSMW

The Republic, If We Can Keep It

With its uninterrupted history of peaceful transition of power through elections, America has a multitude of citizens who justifiably feel pride in the strength of their democracy.  But it cannot be denied that political tensions are rising, and it is not uncommon for occupants of the extreme end of both sides of the political spectrum to voice fears of (or hopes for) revolution.  Is there any reason to believe that the republic is in danger of revolutionary activity? Michael Applebaum, MD - American Thinker - Click To Read More...