Daniel J. Mitchell: US Pandemic Emergency Spending Riddled With Fraud

Politicians and bureaucrats are (self-interested) conduits for taking money from one group of people and giving it to another group of people.

Milton Friedman famously explained that this is why they largely don’t care about how much money is spent or how effectively it is spent.

No wonder government programs, agencies, and departments waste so much money, year after year, decade after decade.

This observation about careless profligacy also applies to so-called emergency spending.

I’ve repeatedly written about the perverse impact of unemployment benefits that are so excessive that people have big incentives not to work.

Daniel J. Mitchell - Comparing the Economic Growth of East Germany to West Germany: A History Lesson

Donald Trump is an incoherent mix of good policies and bad policies.
Some of his potential 2020 opponents, by contrast, are coherent but crazy.
And economic craziness exists in other nations as well.

Socialism Ruined East Germany

In a column for the New York Times, Jochen Bittner writes about how a rising star of Germany’s Social Democrat Party wants the type of socialism that made former East Germany an economic failure.

Daniel J. Mitchell: Marginal Tax Rates Matter

Three years ago, I shared two videos explaining taxation and deadweight loss (i.e., why high tax burdens are bad for prosperity).

Today, I have one video on another important principle of taxation. To set the stage for this discussion, here are two simple definitions:

• The “average tax rate” is the share of your income taken by government. If you earn $50,000 and your total tax bill is $10,000, then your average tax rate is 20 percent.
• The “marginal tax rate” is the amount of money the government takes if you earn more income. In other words, the additional amount government would take if your income rose from $50,000 to $51,000.

Daniel J. Mitchell: The United Nations Report on American Poverty Is Just Plain Wrong

When writing about the statist agenda of international bureaucracies, I generally focus my attention on the International Monetary Fund and the Organization for Economic Cooperation and Development.

Today, let’s give some attention to the United Nations.

Based on this story from the Washington Post, the bureaucrats at the UN have concluded that America is a miserable and awful nation.

…a new United Nations report that examines entrenched poverty in the United States…calls the number of children living in poverty “shockingly high.” …the report, written by U.N. special rapporteur on extreme poverty and human rights Philip Alston, says the United States tops the developed world with the highest rates of youth poverty… The results of the report are not out of line with a number of others…in recent years by different organizations in which the United States has turned up at or near the top on issues such as poverty rates.

Daniel J. Mitchell: Italy’s Countdown to Fiscal Crisis

As a general rule, we worry too much about deficits and debt. Yes, red ink matters, but we should pay more attention to variables such as the overall burden of government spending and the structure of the tax system.

That being said, Greece shows that a nation can experience a crisis if investors no longer trust that a government is capable of “servicing” its debt (i.e., paying interest and principal to people and institutions that hold government bonds).

This doesn’t change the fact that Greece’s main fiscal problem is too much spending. It simply shows that it’s also important to recognize the side-effects of too much spending (if you have a brain tumor, that’s your main problem, even if crippling headaches are a side-effect of the tumor).

Daniel Mitchell: More Pay for Unionized Teachers Is the Wrong Solution to the Wrong Problem

Education spending and teacher pay have become big issues in certain states.

Unfortunately, not for the right reason. In an ideal world, taxpayers would be demanding systemic reform because government schools are getting record amounts of money (higher than any other nation on a per-student basis) while producing sub-par results.

Instead, we live in a surreal parallel universe where teacher unions are pushing a narrative that taxpayers should cough up more money because teachers supposedly are underpaid.

Daniel Mitchell: Why Is the EU Celebrating Karl Marx's Birthday?

Celebrating the 200th birthday of Karl Marx is a slap in the face of millions of people killed by communism. The evil ideology known as communism left a track record of unimaginable horror. Experts estimate that 100 million people were killed by Marxist regimes. Some were murdered. Other starved to death because of the pervasive economic failure of communism.

Yet there are dupes and apologists who overlook all this death and misery. One of them is Jean-Claude Juncker, the President of the European Commission. A few days from now, this über-bureaucrat will help celebrate the 200th birthday of Karl Marx.

Daniel Mitchell: Emmanuel Macron Is Surprisingly Pro-Market for a Socialist... Sometimes

In last year’s French presidential election between Emmanuel Macron and Marine Le Pen, I joked that voters should choose the socialist over the socialist, but made a serious point that Macron—despite having been part of Hollande’s disastrous government—was preferable since there was at least a hope of market-oriented reform.

…the chance of Macron being good are greater than zero. After all, it was the left-wing parties that started the process of pro-market reforms in Australia and New Zealand. And it was a Social Democrat government in Germany that enacted the labor-market reforms that have been so beneficial for that nation.

Daniel Mitchell: Can a Flat Tax Rescue Italy’s Economy?

To put it mildly, Italy’s economy is moribund. There’s been almost no growth for the entire 21st century.

Bad government policy deserves much of the blame.

According to Economic Freedom of the World, Italy is ranked only 54th, the worst score in Western Europe other than Greece. The score for fiscal policy is abysmal, and regulatory policy and rule of law are also problem areas.