Diversity Agenda Vs. Learning

Class Warfare Taxes

Threats to Free Speech Online What Will It Take to Control

Spending?

SPRING 2019 Freedom Is for Everyone

N THIS ISSUE, YOU WILL FIND oppressors to the oppressed (primarily racial Heather Mac Donald (p. 16) discussing “the and sexual minorities) is the only just purpose I trashing of Western civilization” on college of politics, and if individual rights get in the campuses. Picking up that theme, Mike Gon- way of that project, then they must be shoved zalez (p. 32) identifies the entitlement state aside. Likewise, GDP growth, debt, deficits, and as a major motivator of those same corrupt- other traditional metrics of good policy matter ing agendas. not when weighed against the imperatives of A few pages away you can find Dan Mitchell equality of condition. (p. 26) employing the concept of deadweight loss In the conservative understanding, the to explain why everybody loses when tax rates preservation of individual liberty is the only are high, and Jonathan Bydlak (p. 21) making the legitimate purpose of government, and limiting case that controlling federal spending requires political power via a constitution of checks and budget process reforms. balances and rights is the means by which liberty Something for everybody—or at least is preserved. everybody who likes bad news. Read in While the conservative concern for conjunction, these articles lead to a dire constitutional rigor may seem distant from summation of our current situation: the everyday struggles of people, it at least has Raising taxes will harm the economy and lead this advantage over the progressive mania for to even more government spending (and deficits equality: It does not create insoluble conflicts and debt); but government spending is already over who is more oppressed than whom. rising because organized interest groups value Progressives want more minorities admitted such spending and the political process rewards to universities—as long as those minorities politicians for delivering it; meanwhile, the are not highly qualified Asian-Americans. very existence of the entitlement state induces Progressives want economic justice—but citizens to see their interests in terms of what primarily justice for the inner cities, not government gives them; that, in turn, encourages so much for the hayseeds up in the holler. citizens to identify as members of interest Progressives oppose bigotry—unless it’s bigotry groups, often organized around some concept (and worse) perpetrated against homosexuals of victimhood, ensuring that constituencies for in the name of Islam. Progressives want to spending remain powerful; and all along, rising stand with the historically oppressed—as long generations are being taught that freedom is as the historically oppressed are not Jews a con designed to keep straight, white men supporting the state of Israel. Progressives in power. want to promote the voices of racial It’s a complicated knot. So how can it be minorities—as long as those voices aren’t untangled? You start by picking a string. Fiscal expressing conservative opinions. sanity can help fix the culture, and fixing the With progressives in power, you can never culture can make it easier to find fiscal sanity. be sure that you won’t be the next egg broken The best case for cutting spending is grounded for an omelet. Conservatives don’t have need of in an understanding of the legitimate purposes doctrines to resolve the tensions between theory of government. And convincing people that and practice—such as intersectionality—because government has grown beyond those purposes freedom really is for everybody. Peter’s liberty is requires talking about things other than math not diminished when Paul’s is protected. In fact, and economics. it’s enhanced. It also helps to know the contrary position. And when government protects your liberty, As the Left sees things, individual rights are it puts your fortunes and your future in your less important than power, disparities in which own hands, not that of a group claiming you as a ALEX ADRIANSON edits The Insider. Have a story idea? are the real cause of suffering in the world. In member. If we can’t win with that message, then Want to connect with him?

Email [email protected] this view, the redistribution of power from the we are doing something wrong. IMAGES WEBKING/GETTY COVER:

2 SPRING 2019 THE INSIDER CONSERVATIVE IDEAS FOR ADVANCING LIBERTY

CONTENTS | SPRING 2019

EDITOR’S NOTE 2 What Will ONE QUESTION 21 What One Change It Take to Would Improve the U.S. Immigration Control System? 4 Spending?

ROUND UP Tax Rates in the ’50s, Homeschoolers Shine, Late-Term Abortions, CBO Mis-Estimates, Admissions Scandal How the 9 Diversity Agenda TOOLKIT Corrupts Higher Effective Facebook Education 26 Marketing in the Age of AN INTERVIEW WITH Class Warfare Algorithm Anxiety 16 HEATHER MAC DONALD Taxes 14

CALENDAR 40 35 32

PICTURING POLICY The Enemies Economic Freedom Is Good for the of Free Speech Environment Are Targeting Who Taught Citizens to Think 43 the Internet of Themselves as Victims?

© 2019 The Heritage Foundation | 214 Massachusetts Avenue, NE | Washington, DC 20002 | (202) 544-4400 Alex Adrianson, Editor | Kay Coles James, President | Robert Bluey, Vice President of Communications | Jim Weidman, Editorial Director | Melissa Bluey, Designer Founded in 1978 by The Heritage Foundation, The Insider is a quarterly journal of conservative ideas for promoting liberty in public policy. Contact the editor: [email protected] Nothing in these pages is to be construed as necessarily reflecting the views of The Heritage Foundation or as an attempt to aid or hinder KEITHBISHOP/GETTY IMAGES; ARTISTEER/GETTY IMAGES; JUSTIN SULLIVAN/GETTY IMAGES SULLIVAN/GETTY JUSTIN IMAGES; ARTISTEER/GETTY IMAGES; KEITHBISHOP/GETTY CLOCKWISE: DAVID MUIR/GETTY IMAGES; ETHAN MILLER/GETTY IMAGES; IMAGES; MILLER/GETTY ETHAN IMAGES; MUIR/GETTY DAVID CLOCKWISE: the passage of any bill before Congress.

THE INSIDER SPRING 2019 3 A WALL MARKS THE U.S.-MEXICAN BORDER at Tijuana and Baja, March 13.

What One Change Would Improve the U.S. Immigration System?

DAVID INSERRA enough time talking about the fact that once an illegal immigrant enters the country and is Right now we are seeing a spike in illegal apprehended, the immigration system generally immigration at our southern border. Three just releases them into the United States. things distinguish these immigrants from Two loopholes plus our weak asylum system those who arrived previously. They are mostly: have created this catch-and-release system. The unaccompanied children or “family units” first is the well-intentioned Trafficking Victims (i.e., adults with children); from Guatemala, Protection Reauthorization Act of 2008. The Honduras, or El Salvador, rather than Mexico; second is the ruling of the Court of Appeals for and increasingly claiming, though not the Ninth Circuit in Flores v. Lynch (2016), which necessarily being granted, asylum. reinterpreted a 1997 settlement known as Flores. Even though we are catching most of these Because of these two loopholes if you show up at aliens, we cannot remove them from the United the border as an unaccompanied child or as an States because of loopholes in our laws. We adult with a child, the United States is required spend a lot of time talking about border barriers by law to release the child and the family into the and other tools to secure the border, which do United States. slow down border crossings and increase the In 2018, the Trump administration began a

chances of apprehension. But we don’t spend policy of zero tolerance of illegal immigration, IMAGES VIA GETTY IMAGES/LIGHTROCKET JELINGER/SOPA MEGAN

4 SPRING 2019 THE INSIDER which resulted in detaining parents JESSICA VAUGHAN Tweaks using so their cases could be adjudicated, executive authority leading to, in most cases, deportation In fiscal year will help, but the most of the families. This policy became 2017, foreign visitors The effective way to deter known as family separation. In overstayed their legal proceedings overstays is to reduce the response to intense political entries about 700,000 incentives and increase furor over family separation, the times, with more than for the average the risk of consequences. administration reversed the policy 400,000 of them failing overstayer likely If overstayers cannot after only a couple months. So right to depart or acquire will take over easily get a job, a driver’s now, family units showing up at our a legal status within eight years. license, and other southern border are caught and then eight months after the benefits, there is little released. Many will fail to show up for end of the fiscal year. One option point to remaining their immigration court hearing, yet Not only does this is to require illegally. Implementing keeping the family together in custody rampant disregard for certain mandatory use is simply not allowed by law. our laws undermine of E-Verify and Our asylum system contributes to the integrity of our categories discouraging sanctuary this mess by ensuring that very weak immigration system, it is of visa policies will help. claims of “credible fear” are used to also a national security holders to For those who will delay the adjudication of these cases, and public safety not be deterred, we guaranteeing that the claimants will vulnerability, since we waive their need more effective be released into the United States. can’t know the motives of rights to enforcement. Unlike The result is the surge we are those who overstay. a court illegal border now seeing at our borders with Congress has been hearing as crossers, who often children used as pawns to game the pressing for action for can be processed system. And because of the special 25 years, but successive a condition administratively by attention and legal processes we administrations have of admission. immigration officers give to children and asylum seekers, failed to address the upon arrest, visa our immigration officials and court problem. The first step overstayers are system are underwater, with no hope was to implement an entry-exit entitled to more generous forms of ever digging out. Without changes, system, and one important benefit is of due process, including a hearing most of these illegal immigrants will that we now have a better idea of who in immigration court and the remain in the United States even is overstaying and in what categories opportunity for protracted appeals. though only about 10 percent of of entry. Our immigration courts are now so Central Americans will actual end up Now the State Department must dysfunctional that the proceedings being given asylum. adjust and issue fewer visas to for the average overstayer arrested These loopholes should be changed applicants in categories with poor today likely will take over eight to allow us to keep families together, compliance. Dozens of countries have years. Congress should address the but quickly return them to their overstay rates of more than 30 percent backlog; one option is to require home countries. The asylum process in the student and worker categories, certain categories of visa holders to should also be pushed away from but their citizens continue to get visas. waive their rights to a court hearing our borders so that claims can be In addition, we need to end the as a condition of admission, as is the handled in Mexico or even in Central practice of giving every short-term case for those entering under the Visa America. Anyone who refuses to visa holder a default six-month Waiver Program. make an asylum claim south of our duration of stay. Instead, the routine In addition, visa sponsors— border should not be allowed into the admission should be no more than employers, exchange programs, United States unless they meet a high 30 days, unless the traveler can show schools, and labor brokers—who threshold of evidence for asylum. a credible reason for a longer stay. routinely fail to meet standards for By making these and other fixes, Similarly, the duration of stay for participants’ compliance should the United States can more effectively Mexicans using the much-abused be barred from sponsoring future deter illegal immigration. Border Crossing Cards intended for visa applicants. Mr. Inserra is a policy analyst at shopping and quick visits should The travel sector, certain employer The Heritage Foundation. again be restricted to 72 hours. groups, and the education industry

THE INSIDER SPRING 2019 5 have been lobbying the president have developed, causing average and Congress to issue more visas for waits to double. Many immigrants students and guest workers, expand now wait a decade or even multiple visa waivers, and back off reforms to decades to receive legal permanent exchange programs. It is irresponsible residence. A slow cumbersome to even consider such proposals until process simply doesn’t work for an overstays are greatly reduced. advanced economy and stands as Ms. Vaughan is an advertisement for director of policy illegal immigration. studies at the Center for If Congress does Immigration Studies. break its logjam on Congress immigration, it should DAVID BIER construct a system that should is responsive to changes Congress should remove in the economy and replace America’s immigration society, making constant current static updates unnecessary. immigration system with caps It should remove a dynamic one. During entirely immigration caps the last three decades, for the entirely for the highest America’s population skilled categories—stop has grown by a third, highest making Einsteins wait and its economy has skilled for permanent residence. doubled in size. The For the remaining caps, categories— ANDREW ARTHUR share of U.S workers stop making Congress should first in the labor force with update them to reflect a college degree has Einsteins the changes since 1990, One simple change would doubled, while the wait for and then going forward, eliminate most if not all of the share without a high permanent it should link the family- challenges facing the U.S. immigration school degree has halved. and employer-sponsored system: mandating that employers About three quarters residence. limits to population use the E-Verify process to ensure of the Fortune 500’s growth and economic that employees are eligible to work in largest companies were growth, respectively. the United States. replaced, while entire That way as the number The Department of Homeland new industries—the Tech of families in the Security (DHS) explains the process Economy, the Internet Economy, and United States increases, the green on its website: the Gig Economy—have come to life. card quotas for families increases Despite these vast changes, Congress proportionally, and as economic In the E-Verify process, has failed to update America’s legal growth accelerates, businesses can employers create cases based immigration system. hire more foreign workers. on information taken from an The last legal immigration Congress cannot predict the exact employee’s Form I-9, Employ- overhaul came in 1990. Congress types of workers or numbers that a ment Eligibility Verification. increased the caps for family- and future economy will need. But it can E-Verify then electronically employer-sponsored immigrants and predict with certainty that the world compares that information created a couple of new categories will not stand still. It needs to make to records available to [DHS] for green card applicants, such as sure the immigration system keeps up and the Social Security one for investors. But since then, the with the world around it. This simple Administration (SSA). The numbers have remained stuck. The reform would prevent the immigration employer usually receives a result is an antiquated immigration system from becoming outdated response within a few seconds system out of touch with the U.S. almost as soon as a new law is enacted. either confirming the employ- economy and society. Huge backlogs Mr. Bier is a policy analyst for the ee’s employment eligibility or

of applicants waiting for green cards Cato Institute. indicating that the employee IMAGES KALIFA/GETTY TAMIR

6 SPRING 2019 THE INSIDER FROM LEFT: PROTESTORS RALLY AGAINST zero-tolerance immigration policies at Brownsville, Texas, June 28, 2018; an officer of the Mexican Federal Police stands next to the US-Mexico Border Fence on April 5 in Mexicali, Mexico.

needs to take further action to stands at about 856,000; that backlog with children and unaccompanied complete the case. could slowly be whittled down if the alien minors to enter the United flow of illegal workers was stymied. States illegally, straining Border During my eight years as Then, U.S. Immigration and Patrol resources. an immigration judge, I heard Customs Enforcement (ICE) would Aliens who manage to evade approximately 15,000 cases. By my no longer have to devote as many detection at the border or overstay rough estimate, at least 98 percent of resources to apprehending illegal could still apply with one of our those aliens came to the United States aliens. With the proliferation of approximately 520 asylum officers to work. so-called “sanctuary jurisdictions” for “affirmative asylum.” Such an The decision to enter the United (which refuse to cooperate with application carries the possibility States illegally or to overstay a visa for immigration enforcement), ICE must of an employment authorization such individuals is a simple economic routinely send officers into the field document (EAD) to even those with one: Will I make enough money in the to apprehend visa overstayers—a non-meritorious claims to work United States to pay the smuggler or necessity that endangers both ICE in the United States if their bogus the other fees what it cost to get here? officers and the public. claims cannot be adjudicated within E-Verify will effectively deny most of E-Verify implementation would 180 days. those individuals the opportunity to slash the number of aliens entering Mandating E-Verify would work in this country. By turning off illegally, allowing our 18,600 Border nonetheless make the work of our the “jobs magnet” that lures those Patrol agents to focus more resources immigration officials significantly foreign nationals to this country, that on drug and contraband smuggling, easier. The president can implement flow of migrants stops. and fewer on aliens slipping across that policy by executive order. The other problems facing the U.S. the border. He should. immigration system would become E-Verify would not be a silver Mr. Arthur is a resident fellow manageable. The caseload facing our bullet. Loopholes in our border in law and policy at the Center for

LUIS BOZA/VIEWPRESS/CORBIS VIA GETTY IMAGES VIA GETTY BOZA/VIEWPRESS/CORBIS LUIS 400 immigration judges currently laws would still encourage families Immigration Studies.

THE INSIDER SPRING 2019 7 suspicion the individual is an illegal alien. States should not provide driver’s licenses to illegal aliens, nor should they allow illegal aliens to obtain license tags for their automobiles. Illegal aliens should be banned from obtaining professional licenses of any kind, and they should not be eligible for any state or local benefits such as public assistance or in-state tuition. In fact, federal law (which, unfortunately, has not been enforced) prohibits state universities from providing in-state tuition to illegal aliens unless the same in-state tuition is offered to all students who are citizens. There should be no PROTESTORS RALLY AGAINST zero-tolerance immigration policies in Bridgeport, Conn., July 11, 2018. financial or other incentives of any kind that provide illegal aliens with a reason to come to, or remain in, the HANS VON and public safety for United States. SPAKOVSKY the federal government The vast majority of illegal aliens to be notified so these come here for economic reasons—to While Article State criminal aliens can be earn money to send back to their I, Section 8 of the governments picked up by federal families in their native countries. Constitution gives should authorities and removed To protect American workers and Congress exclusive from the country, either reduce this economic incentive, authority over prohibit local after they have been the federal government requires immigration, there is governments arrested or detained or employers to check the citizenship a great deal that state from after they have served or legal immigration status of all new and local governments their sentences. employees to prevent illegal aliens can do in this area. In implementing State governments from obtaining employment. It also fact, their assistance any policies should prohibit local provides the federal E-Verify system and the resources they that prevent governments from that employers can voluntarily use to can bring to bear on local law implementing any comply with this requirement. the problem are vital policies that prevent In 2011 in Chamber of Commerce to the United States enforcement local law enforcement v. Whiting, the U.S. Supreme Court having a comprehensive, from notifying, from notifying, assisting, upheld an Arizona statute that made efficient enforcement assisting, or or cooperating with use of the federal E-Verify system system to prevent federal immigration by Arizona employers mandatory. illegal immigration. cooperating authorities; instead, The state statute imposes a series of Implementing with federal state governments penalties on employers who knowingly sanctuary policies are immigration should require such or intentionally employ illegal aliens, the exact opposite of assistance by local including suspension or revocation of what local governments authorities. communities. In 2012, the employers’ business license. This is should do. In fact, local in Arizona v. U.S., the a key method for ensuring that illegal law enforcement should be acting as U.S. Supreme Court upheld Arizona’s aliens are not unlawfully employed, advance scouts for federal authorities. requirement that law enforcement which reduces their economic When aliens are arrested for officials check the immigration incentive to remain in the country. committing local crimes, it is in the status of anyone they arrest, stop, Mr. von Spakovsky is senior legal

best interests of local communities or detain if they have a reasonable fellow at The Heritage Foundation. IMAGES OHN MOORE/GETTY

8 SPRING 2019 THE INSIDER IRS WORKERS PROCESS TAX RETURNS at the IRS regional office, Philadelphia, March 11, 1965.

Tax Rates in the ’50s, Homeschoolers Shine, Late-Term Abortions, CBO Mis-Estimates, Admissions Scandal

In the 1950s, effective average federal taxes prevailed, taxpayers could write off all state were only 17 percent. Milton Ezrati weighs in and local taxes, with no limit—including sales on the arguments for a 70 percent top tax rate taxes, licensing fees, property taxes, and income to fund a “Green New Deal”: taxes. They could also write off all interest expenses without limit—on their mortgages (no [Paul] Krugman and [Alexandria Ocasio- matter how many), all credit-card debt, auto Cortez] play fast and loose when it comes to the loans, or home-improvement loans. Imagine the country’s prosperity under high tax rates. It’s benefits to a plutocrat, buying a third home or a true that the United States prospered with a fifth Bentley. top rate of 70 percent and higher in the mid- His tax would be calculated on net income, 20th century. But the tax code then included reduced by any fees, sales, or transfer tax, as well loopholes that drastically reduced the amount as all the interest expenses on the mortgages of income subject to those rates. All the tax cuts or auto loans over the years. The code included since then have closed those loopholes. One can dividend exclusions and generous provisions for forgive Ocasio-Cortez for missing the difference, capital-gains preferences. Taxpayers back then as she has consistently shown economic and could shelter unlimited amounts in IRAs. Social historical ignorance, but Krugman should Security payouts were tax-free, no matter how ROUND UP highlights know better. high a person’s income. Individuals could write key work produced by conservative and classical In the 1960s, 1970s, and early 1980s, for down their taxable income through averaging liberal think tanks. Submit ideas at [email protected] MARION S TRIKOSKO/PHOTOQUEST/GETTY IMAGES MARION S TRIKOSKO/PHOTOQUEST/GETTY instance, when the 70 percent maximum rate provisions and transfer as much income as they

THE INSIDER SPRING 2019 9 liked to their children, who paid at Homeschools outshine public worrying that many public school lower rates. There was no limit to schools. J.D. Tuccille writes: graduates are unprepared for either rental-loss deduction. Business losses higher education or the workforce. counted against all income. In 2014, SAT “test scores of college- No wonder colleges not Given these breaks and loopholes, bound homeschool students were only welcome, but actively recruit, it’s no surprise that few people higher than the national average of homeschooled applicants. actually paid those high rates on all college-bound seniors that same But what about the impact of DIY much of their income. The nonprofit year,” according to [the National education on the larger world—say, Tax Foundation estimates that in Home Education Research Institute]. the development of “parallel societies” the 1950s, for instance, when the top “Mean ACT Composite scores that Germany cites as grounds for statutory rate was 92 percent, the for homeschooled students were banning the practice? We should be so top 1 percent of taxpayers wrote off consistently higher than those for lucky—homeschoolers seem inclined so much income that their effective public school students” from 2001 to create better societies. average federal tax rate was about 17 through 2014, according to that “Students with greater exposure percent. If our highest earners today testing organization, although private to homeschooling tend to be more were offered the 2019 code or the school students scored higher still. politically tolerant—a finding old one, they might well go for the By contrast public contrary to the claims of many old rules, even at a 92 percent top school kids “bombed the political theorists,” reports research rate. [Milton Ezrati, “The ‘Green New SAT,” reports Bloomberg. Mixed published in the Journal of School Deal’ Is a Fiscal Fantasy,” City Journal, but generally disappointing results Choice. Defined as “the willingness

January 14] since then have education experts to extend civil liberties to people who IMAGES VIA GETTY NEWS MEDIA/THE MERCURY FIRST CHAVEZ/DIGITAL RAY

10 SPRING 2019 THE INSIDER hold views with which one disagrees,” for reasons of fetal anomaly or life In what was literally a footnote in this finding of greater political endangerment.” Instead, there were its annual report on national health tolerance among the homeschooled “five general profiles of women who spending projections, actuaries has important ramifications in this sought later abortions, describing for the Centers for Medicare and factionalized and illiberal era. 80% of the sample.” These women Medicaid Services […] estimated that “In other words,” writes author were “raising children alone, were the elimination of the individual Albert Cheng of the University of depressed or using illicit substances, mandate would have a significantly Arkansas’s Department of Education were in conflict with a male partner smaller impact than the CBO has Reform, “members of the very group or experiencing domestic violence, long estimated. Specifically, the CMS for which public schooling is believed had trouble deciding and then had report revealed that 2.5 million more to be most essential for inculcating access problems, or were young and people would go without insurance in political tolerance (i.e., those who nulliparous [had never 2019 due to the repeal of are more strongly committed to given birth].” [David the individual mandate’s a particular worldview and value French, “It’s Time for the penalties, and the impact system) actually exhibit at least as Truth about Late Term would be “smaller” much or more tolerance when they Abortions,” National thereafter. [Philip are exposed to less public schooling.” Review, February 1] Members Klein, “Government [J.D. Tuccille, “Homeschooling of the very Report Reveals CBO Produces Better-Educated, More- The Congressional group for Was Scandalously Off in Tolerant Kids. Politicians Hate That,” Budget Office estimate Obamacare Estimates,” Reason, January 22] was wrong—by about which public Washington Examiner, 460 percent. Philip schooling is February 20] Late-term abortions are rarely done Klein reports: believed to be for the health of the mother. David A federal tax credit French writes: CBO estimates about most essential for school choice will the importance of an for inculcating invite federal control— Late-term abortion is, fortunately, individual mandate political imperiling choice. Neal relatively rare. According to the most to a national health McCluskey points out recent CDC data, only 1.3 percent care scheme prodded tolerance a problem in the new of abortions occur after 21 weeks. President Barack Obama actually exhibit school choice bill put However, given the sheer number of into including the at least as forward by Sen. Ted abortions in this country (638,169 unpopular provision much or more Cruz, (R-Texas) and Rep. reported to the CDC), that means into the law in the first Bradley Byrne (R-Ala.): there were at least 8,000 late-term place. The mandate tolerance abortions in the United States. As projections also played when they School choice is Jonah Goldberg notes today, the a key role in President are exposed about individualization pro-abortion-rights Guttmacher Trump’s two major and freedom, and Institute puts the number even legislative initiatives. to less public almost certainly that higher, at roughly 12,000 late-term The fact that the CBO schooling. is what [Education abortions per year. That’s a lot of assumed 14 million could Secretary Betsy] babies dying late in pregnancy. To lose coverage mainly DeVos, Cruz, and Byrne gain a sense of perspective, that due to the elimination of mandate want. But federal initiatives are a number is comparable to the number penalties helped kill the effort to terrible way to deliver that. The of murders committed by firearms in repeal and replace Obamacare, while reality is that what the feds fund, the same time period. its later assumption that 13 million even indirectly, they inevitably So, why do these babies die? The fewer insured individuals would mean want to control. DeVos, Cruz, and Guttmacher Institute has looked at less spending on subsidies from the Byrne specifically acknowledge the reasons for late-term abortion, federal government helped get the 2017 that historical reality in federal and the reasons are chilling. First, Republican tax cut across the finish line education policy. They write, “A the top-line finding is clear: “[D]ata by improving the budgetary math. Yet series of administrations on both suggest that most women seeking those incredibly influential estimates sides of the aisle have tried to fill later terminations are not doing so now appear to have been wildly off. in the blank with more money and

THE INSIDER SPRING 2019 11 more control, each time expecting will have the power to decide which sounds like the federal government a different result.” Note that the state programs are or are not eligible, is doing the funding, and what primary vehicle for that control, and on what grounds. As Corey government funds it tends to control. the Elementary and Secondary DeAngelis and others have noted, Also, that Secretary DeVos is so Education Act, started aimed just what happens when, instead of a prominent in the proposal release at funding low-income districts. President Trump, we have a President at least symbolizes not only federal It eventually became the uber- Sanders or Harris and they don’t like intervention in education policy, but controlling No Child Left Behind Act. the policies of religious schools, or a strong connection to the executive— DeVos, Cruz, and Byrne are looking maybe how economics is taught? the dangerously regulatory—branch to skirt the control problem, sticking Suddenly lots of private schools of the federal government. [Neal with tax credits instead of vouchers, and other options will be federally McCluskey, “Even Something as and letting states opt in. But not pressured to look very similar—shape Great as School Choice Should Not only is this unconstitutional—taxes up or credit eligibility goes away—and Be Federalized,” Cato Institute, are authorized to execute specific, true choice will be curtailed. February 28] enumerated powers, not to lightly Even the roll out of the proposal engineer state policy—it won’t, raises the specter of federal control. Tariffs beget more tariffs. Veronique ultimately, prevent encroaching Though the great benefit of tax de Rugy explains: federal control. If enacted, the credit credits is they do not use government would spur people to demand their money, and hence are less prone to In the end, the steel tariffs have states participate, and as more regulation than vouchers, DeVos, made the production of American- schools benefited from federally Cruz, and Byrne write that through made products more expensive. This connected scholarships all schools their proposal they “are putting makes those American producers would be financially pressured to use forward a historic investment in who use steel less competitive on

them. But the federal government America’s students.” That sure global markets. IMAGES AGUILAR/AFP/GETTY JULIO CESAR

12 SPRING 2019 THE INSIDER Enter American producers of line It is a scandal that anybody thinks to 5,000 in recent years. Nowadays, 26 pipe. As it happens, the raw materials college admission is worth the cost percent of the students who got into these producers use in their domestic of a bribe. Kenny Xu writes: the 70th percentile or higher on the production of large-diameter welded SAT had some form of private college line pipe and structural pipe are The bribery scheme to get consulting help. subjected to Section 232 tariffs privileged children into elite Economist Bryan Caplan puts (25 percent on steel imports from universities is causing parents this inversion of the goals of higher Canada, China, Greece and India, 50 and teachers across the country to education more bluntly. Imagine if you percent on imports from Turkey and fume with righteous indignation. could get a degree from Georgetown quotas on imports from Korea). As But the revelations of corruption University without attending any expected, the line pipe producers’ in the multibillion-dollar college- classes. Now imagine you could take production costs rose. And now these admissions industry is perhaps more every class at Georgetown without producers have gone before the [U.S. indicative of how Americans’ views of getting a degree. Which option would International Trade Commission] college—especially among the elite— you choose? Most likely, the one that to argue that they are being injured are shifting into dangerous territory. signals value—the former. by dumping—selling in the United More Americans no longer value The irony is that the signaling States at prices below “fair value”— college education for its ability to value of elite colleges is quite carried out by Chinese and Indian train their children with the skills misplaced. According to a paper by manufacturers of allegedly subsidized needed to thrive in adult life. Instead, mathematician Stacey Dale and line pipe. they obsess over college’s signaling economist Alan Krueger, if your Three of the five USITC value—the value of a school’s name child is smart enough to get into commissioners agreed. This ruling and prestige. an elite college, but chose not will trigger countervailing and One can see this trend amid to go, he or she will still end up anti-dumping duties from the the booming college-consulting making approximately the same as Department of Commerce, and as a industry, where consultants seek to a similarly qualified applicant who result, everything will end up being do everything legally possible to get did go to an elite college. [Kenny Xu, more expensive. their client’s child into the best-name “College Admissions Bribery Scandal The question is: When and where colleges. The number of professional Shows How Higher Ed Culture Has does this cascading protectionism college consultants among the Descended into Signaling,” The Daily stop? Of course, the steel tariffs nation’s elite has jumped from 2,000 Signal, March 15] have affected products other than large-diameter line pipe. All American producers that use steel as inputs are negatively affected by the administration’s import taxes. Inevitably, then, the USITC will see a surge of American manufacturers coming to ask for protection from foreign competitors for their products when, in fact, they need only protection from the Trump administration’s trade hawks, who have made input more expensive. [Veronique de Rugy, “Learning the Lessons of Protectionism the Hard Way,” The American Spectator, February 28]

TWO WOMEN, HOLDING SIGNS at a federal courthouse in Boston on April 3, would like actress Lori Loughlin to pay their tuitions. Loughlin and her husband are two of dozens of parents charged in

JOSEPH PREZIOSO/AFP/GETTY IMAGES PREZIOSO/AFP/GETTY JOSEPH the college admissions scandal.

THE INSIDER SPRING 2019 13 Effective Facebook Marketing in the Age of Algorithm Anxiety BY RYAN GREEN

CCORDING TO NIELSEN, When it comes to digital, Facebook continues American adults spend nearly half to own the largest share of attention. According A their day consuming content. to Pew Research Center, roughly two-thirds of Our job as thought leaders and marketers U.S. adults are active Facebook users. In January is to find out how to reach that audience—to 2018, Facebook released an earnings report that create that content—in the most cost-effective revealed the average user spends more than 40 way possible. minutes per day on the platform. (If you’d like to What we’re after is simple: attention. So how know how much time you spend on Facebook, go do we get it? to “settings and privacy” and select “your time On average, American adults spend over 11 on Facebook.”) hours per day listening to, watching, reading or Facebook’s continued dominance has forced generally interacting with media. And despite marketers to contend with its ever-changing the rumors, television is still king, owning nearly algorithm. According to Pew, Facebook’s five of those hours. algorithm remains a mystery for more than half During their most recent earnings report, of its users. Netflix revealed that they own 10 percent of TV Facebook has attempted to demystify its time, or roughly 100 million hours per day in the algorithm, which it refers to as “ranking.” United States. Why is that important? Attention. They’ve revealed three main points: Attention is the most coveted commodity in today’s world, which is why Netflix is now worth ■■ Ranking looks at likes, comments and more than Disney and Comcast. shares to identify posts that matter to Some players in the nonprofit and advocacy users. world are slowly dipping their toes into Netflix. But for most groups, that’s not feasible. ■■ Ranking considers whether a poten- They look to social media for attention and tial interaction is between two people

community building. or between a person and a page. Per- / EYEEM/GETTYIMAGES KONGSIRIMONGKOLCHAI PATRA

14 SPRING 2019 THE INSIDER son-to-person is ranked higher as “see first” will ensure your posts stock photography, poor headlines, than person-to-page. Posts from appear in newsfeeds. Users can scheduling posts at a bad time of day connections within your net- also choose to receive alerts from and failing to engage your community work will get the biggest news- their favorite pages. A short video in the comment section after posting feed boost. with step-by-step instructions is are a few of the mistakes that kill the easiest way to employ the see- organic reach. After that happens, the ■■ Ranking prioritizes “mean- first strategy and market it to your only way to revive your organic reach ingful” exchanges that require community. Users simply navigate to is to reboot your content strategy and more time and care. For your page, select “following,” turn on pay to promote posts to your existing example, typing out a long and notifications, and mark your page “see audience. This can be expensive. thoughtful reply to a post. first” in their newsfeed. Before launching a Users can select up to paid campaign, analyze Did you catch all the clues in five pages to see first in your audience to Facebook’s explanation of ranking? their newsfeed. understand the days and First, engagement—likes, The “group” strategy There’s no times users are active and comments, and shares—is important. focuses on giving evidence develop a day-parting Second, posts from connections users greater control plan, which can be a within your network will get the of the conversation that organic simple grid with days of biggest boost. Having a connection and forming deeper reach is dead. the week across the top with a person or page means you connections by The reality is and hours of the day down interact frequently. creating a Facebook the side. Test different But the last and possibly the group. Groups are not organizations post types—links, images, most important clue is in Facebook’s susceptible to the same have failed videos, polls—at different description of “meaningful” algorithm as pages. to pivot, and times to begin filling out exchanges. According to Facebook, Groups also open up a your day-parting plan. meaningful exchanges require more wide range of features pivot they must The trick to beating time, which is a signal that comments that can increase if they are to Facebook’s algorithm is are weighted more than likes engagement among remain relevant to love your audience. and shares. users. There are three according to Do that, and they’ll love The growing consensus among options for groups: 1) you back. marketing professionals suggests public, which allows Facebook’s Games, gimmicks, Facebook is becoming a paid platform everyone to see members ever-evolving short cuts and tricks will and organizations are forced to pay and content; 2) closed, algorithm. eventually catch up with to reach their audience. While pages which allows everyone to you and kill your organic with larger audiences have a lower see member names but reach. If you build deep, organic reach than pages with smaller not the content; and 3) secret, which meaningful connections with your audiences, there’s no evidence that require invitations and only members community, and make them feel like organic reach is dead. The reality is can see members’ names and content. they are part of a community, they organizations have failed to pivot, and Different group types open up will seek you out and engage with you pivot they must if they are to remain different features. For example, a despite Facebook’s attempts to force relevant according to Facebook’s ever- social learning group allows brands to you to pay for attention in the newsfeed. evolving algorithm. create course-like content structured Building organic reach on Instead of bemoaning that in learning units. Additional features Facebook and any other platform is algorithm, organizations can employ available to all groups include video hard work. But engaging content and several strategies to capture a share watch parties, document sharing, an disciplined, simple strategies make of attention in Facebook newsfeeds. event calendar and polling. it possible. Here’s three to live by: Finally, the “don’t suck” strategy One sure-fire way to lose? The “see first” strategy overrides focuses on providing the right content Complaining about the algorithm. Facebook’s algorithm. Facebook to the right audience at the right time. allows users to control the content This seems simple, but most brands Mr. Green is co-founder and chief appearing in their newsfeed. Asking are terrible at creating engaging marketing officer at Iron Light, a your community to mark your page content. Automation, awkward change-making marketing agency.

THE INSIDER SPRING 2019 15 PROTESTORS RALLY AGAINST CONSERVATIVE BEN SHAPIRO speaking at the University of California at Berkeley, Sept. 14, 2017.

How the Diversity Agenda Corrupts Higher Education: An Interview with Heather Mac Donald

OR HEATHER MAC DONALD, NO and Undermine Our Culture (St. Martin’s Press, belief about current affairs is too 2018). As the subtitle states, things are afoot F comfortable, too convenient, or too on college campuses. We talk we her about crowd-pleasing to go unrefuted by the facts. what’s going on. The Bradley Prize-winning writer has exam- ined the welfare bureaucracy and found that THE INSIDER: If you sample news from college it enables the very behaviors that keep people campuses lately, you are likely to read about in poverty. She has examined law enforcement conservative voices being shut down, professors practices and shown how claims of racist polic- harassed for deviating from Leftist orthodoxy, ing are both incorrect and a threat to the gains restrictive speech codes, obsessions over in public safety (not least for minority commu- microaggressions and privilege, bungled sexual nities) produced by data-driven policing. Her misconduct investigations, and coursework that latest book is The Diversity Delusion: How Race does more to promote political activism than

and Gender Pandering Corrupt the University transmit knowledge. You’ve written a book, The IMAGES SULLIVAN/GETTY JUSTIN

16 SPRING 2019 THE INSIDER Diversity Delusion, that offers an quickly spread throughout much of This is complete nonsense and explanation for these phenomena. the humanities and social sciences, idiocy. But you have a massive What do you think is going on? including fields like anthropology diversity bureaucracy and much of and history. the faculty that encourages students HEATHER MAC DONALD: In a But at least in the 1970s students to believe in their own victimhood. word: the trashing of Western were still allowed to read the great What drives this? I think that some civilization. I have identified three books without being taught to part of society is worried that the major principles that are driving the complain about the authors’ gonads racial achievement gap is not going to destruction of humanistic learning and melanin. Deconstruction did close. And so we’ve become obsessed on college campuses. The first very weird things with the Western with trying to find instances of racism principle is the belief that the most canon—claiming, for example, that to explain it. And many young women important thing about any individual literature was always about its own are determined to see themselves is his race or sex. Second, the belief failure—but it still read that canon as victims rather than the freest that discrimination based on race without the trivializing overlay individuals in human history. I’m still and sex is the defining feature of of identity politics. I puzzled by it because it is America in particular and in Western absorbed deconstruction so counterfactual. civilization in general. And third, uncritically, but I read that any disparity in proportional Wordsworth, Milton, TI: The diversity representation of females or Spenser, and Wallace Students bureaucracy itself has an so-called underrepresented Stevens, without incentive to spread these minorities—that is, blacks and thinking to whine that regularly ideas to make students Hispanics—in any institution is by they were all dead act out little feel that they need the definition the result of racism and white males. psycho-dramas bureaucrats to protect sexism. Alternative explanations— That all changed them, right? such as differences in academic or in the 1980s. of oppression cognitive skills, career preferences, Multiculturalism and before an HM: That’s absolutely psychological disposition, and academic feminism appreciative correct. There is a behaviors—are simply not allowed. started disparaging co-dependency between Those three principles, I think, are works of genius on the audience these narcissistic the core foundational ideas behind basis of their authors’ sex of diversity students and the the diversity delusion. And they are and race. And students deanlets diversity bureaucracy. driving this insane push to reduce all were encouraged to Students regularly act of human experience to racial and reject works that they who use the out little psycho-dramas sexual oppression. This push denies had not even read simply occasion to of oppression before an students the opportunity to lose because those works expand their appreciative audience themselves in the greatest works of were written by dead dominion. of diversity deanlets Western civilization. white males. This was who use the occasion to the era of the infamous expand their dominion. TI: From where does this delusional protest at Stanford Every time there’s some worldview come? University led by Jesse hysterical protest about Jackson: “Hey hey, ho ho, Western phantom racism the response is: “We HM: I can describe its trajectory better Civ has got to go.” Students were need another vice chancellor of equity, than I can be confident about its origin. protesting Stanford’s modest core diversity, and inclusion. We need In the 1970s colleges were under the curriculum that tried to expose more separate facilities for minority reign of a very odd form of literary students systematically to some students. We need a curriculum that is theory called deconstruction or post- founding works of Western thought. devoted to identity politics.” And most structuralism. It held that language Faced with such protests, few faculty fatally, and faithfully, the argument was fatally ambiguous and that dared to defend the Western canon. is: “We need a larger critical mass of linguistic meaning was impossible to And ever since then the humanities minority students.” pin down. Moreover, the human self have been infected by the idea that Now the problem with that is was a mere play of language, a trope. students should study primarily that colleges are already employing Deconstruction’s mannered rhetoric themselves and their own oppression. vast racial preferences to engineer

THE INSIDER SPRING 2019 17 AT THE MASSACHUSETTS STATEHOUSE IN Boston, college students rally for legislation to stop sexual assault on campus, April 10, 2018.

that has gone completely all-in on the diversity idea, transforming its curriculum to focus on identity politics, hiring bureaucrat after bureaucrat to teach students to think of themselves as victims. Nobody has ever done a nationwide tally of what is being spent on diversity bureaucracy, but I can give you some examples. The University of California Los Angeles, a publicly funded school, has a Vice Chancellor of Equity, Diversity, and Inclusion who makes over $400,000 per year. That is several multiples above what your average junior faculty member makes. It could subsidize the tuition of dozens of students. The Berkeley diversity apparatus is about diversity because of the academic and structural racism.” Many $20 million per year. So this is very skills gap. Between blacks and whites students, not surprisingly, choose serious money that is being taken that gap is about a standard deviation the latter explanation. So when a away from, say, buying more library in SAT scores—about 200 points. school responds to these outbreaks books or more professors in German That has not changed for decades. of hysteria over phantom racism literature or more French language And when you admit students with by saying “we need more minority instructors. It also takes away lowered academic standards, whether students” they have to dig down from efforts to lower the obscenely they’re female or minority, you’re even further into the underqualified expensive tuitions that are now putting them at a competitive minority applicant pool and the the norm. disadvantage. They are unable to achievement gap only widens. It compete with their peers. I’m not becomes a vicious cycle. TI: Why are schools spending so much saying that blacks should not go to money on diversity bureaucracy and college. I’m saying that they should TI: Could you give us some sense of administration? How do they benefit have the same chance of success as the scope of the problem? How much from that? any other type of student and go to a money is being spent on diversity college for which they are prepared— bureaucracy? Is the obsession with HM: The bureaucracy is growing rather than being catapulted outside diversity happening at most colleges? everywhere. The explicitly of their skillset into an environment Half? Some? Are there particular labeled diversity bureaucracy is where their peers are more advanced. kinds of schools that have embraced part of a larger student services What happens to the so-called this agenda? bureaucracy, which encompasses “beneficiaries” of racial preferences? all sorts of programs for retention On average, they can’t compete. HM: It’s everywhere. The ideology and first generation students. Even They end up at the bottom of their and the bureaucracy are not confined those, however, are driven by class in terms of GPA. They then to the elite schools. People want to racial preferences, which bring in have two explanations available reassure themselves with the thought students who are not academically to them. They can say: “I was put “well this is just Middlebury, or Yale, or competitive. This growth in academic into an academic environment Harvard.” No—it’s now seeping down administration has been going on for for which I was not prepared.” Or even to the community college level. decades and may be in part simply a they can say: “I’m surrounded by There is a community college in the feature of Western societies in general

systemic bias and micro-aggressions San Diego area—Mira Costa College— that are also experiencing seemingly IMAGES DAVIS/GETTY D. SARA

18 SPRING 2019 THE INSIDER endless bureaucratization. Somehow TI: What role do federal money and at large. The Democratic Party now there is always enough money mandates play in the growth of the is dominated by identity politics. A sloshing around to keep the academic diversity bureaucracy? Democratic politician will typically bureaucracy expanding. preface her comments with a Why the faculty don’t put their HM: Well, federal money that goes statement such as “well, as a woman foot down is a mystery to me, since into student loans is driving a huge ... “ or as a black woman ... ” as if there’s the growth in college administration part of the tuition increases and any kind of necessary relationship far outpaces any growth in faculty those in turn keep the bureaucracy between her “identity” and what she is numbers. I think their acquiescence growing. And Title IX has led to the about to say, which there isn’t. is in part a devotion to racial creation of completely unnecessary The “real world” now features preferences. Colleges, including offices in every university. We all the same insane search for its own their faculty, fight tooth-and- know the stories of the decimation racism and sexism. We saw it in the nail against any suggestion that of male athletics in one-sided reporting of admissions be based on color-blind order to have a 50-50 the encounter between academic merit alone. They fight funding level for female the Covington, Kentucky, for preferences in the Supreme athletics that simply do There is kids and a Native Court, they fight in the court of not have the student American activist, with public opinion, in part out of self- demand, much less nothing you the press jumping on the love. Professors and administrators audience demand. There can say false narrative that the think of themselves as providing are many people who do to a college encounter demonstrated the only safe haven in America for argue that a lot of this is heteronormative “people of color,” who otherwise face driven by government that will be patriarchal white endless discrimination in Red State regulation. I’m less more fiercely supremacist privilege. MAGA country. persuaded by that resisted than: We saw it in the hoax Yet at the same time, there is argument. I think that “There are by the actor Jussie nothing you can say to a college this is fundamentally an Smollett, who allegedly that will be more fiercely resisted ideological issue and that no bigots paid two men to attack than: “There are no bigots on this the bureaucracy merely on this him shouting “this is campus.” It’s the weirdest thing. Many follows. This is driven by campus.” MAGA country!” We saw American institutions today are something much deeper, it in the effort to bring determined to proclaim themselves which is a hatred for down Supreme Court racist. I go around to colleges and I Western civilization. nominee Brett Kavanaugh based on tell the students: You are the most the “believe survivors” mantra, which privileged human beings in human TI: If a doctor prescribes treatments is a direct import from campus rape history. And you are not surrounded that make his patients sicker, then he tribunals and Gender Studies 101. by racists. The faculty here are not is going to lose patients. If a carmaker These ideas are transforming the racist. They want all of their students sells vehicles that have malfunctioning world and even the tech sector. The to succeed, in particular history’s parts, then it is going to lose its car- tech sector now is dominated by oppressed groups. buying customers. Do you think higher feminist ideology. And when I say: “This is not education is ever going to face a And there is another problem. I a racist institution, it is tolerant reckoning for giving its students—i.e., am not sure that a lot of American and open-minded (at least when its customers—ideas that are harmful parents are particularly interested it comes to non-conservatives),” I to them? in whether their kids actually am met with such rage. A diversity learn the fundamentals of Western bureaucrat at the University of HM: It’s a race against time. People civilization in college, so long Colorado Boulder got up and said: have been predicting the collapse as they emerge credentialed “How dare you come to this school of the academic-industrial complex with a high-status diploma. And and say there is not racism here. I’ve for decades, and it just never seems unfortunately even conservatives been the subject of racism myself.” to happen. And it is a race against treat college as simply a jobs It is absolutely perverse that it is an time because students now carry program. Does it raise your salary? insult to say that an institution is fair these ideas into mainstream society That’s the metric. And I think that’s and equitable. like a virus. They infect the world a very misguided one.

THE INSIDER SPRING 2019 19 TI: Clearly there are students who determining social outcomes today. It’s hard to find a faculty search are embracing a victimology mindset. I think even conservatives, younger committee that hasn’t been told by Do you think they are representative conservative students, are more open its dean to tear up its laboriously of college graduates today? Or are to the view that gross systemic bias is produced short list for hiring and they merely the ones creating the still a significant problem in American start over because there were no controversies that make the news? society. I look at the data and do not females among the finalists. I know Do you have any sense of the overall think it is. an engineering professor who was attitudes of today’s college graduate? involved in a faculty search; his dean TI: How does the diversity agenda ordered the search committee to bring HM: I think there is a large affect the quality of intellectual output in a less competitive Israeli female proportion—I don’t know if it’s a at universities? In particular, how does engineer and interview her. They still majority or not—who are jaundiced it affect entrepreneurship, innovation, didn’t vote for her. The dean said: “Go about the diversity agenda and are and science? back; start over; do it again right.” keeping their heads down. The degree They still didn’t vote for her. And of self-censorship on college campuses HM: For a long time optimists said finally, that time, the actual engineers is impossible to overstate—whether it’s there was going to be a cordon won, but choosing candidates based on the part of students sanitaire around the on merit is happening less and less. or those few remaining STEM fields. Surely, And so the diversity agenda is putting faculty who have not they thought, nobody’s our scientific competitive edge at bought into identity going to make the risk. China, at least in the sciences, politics. Nobody dares Surely, argument that math seems to care about one thing, which speak up. But all it takes is a heteronormative is qualifications. is a small percentage of nobody thinks masculinized space. vocal believers; they’re that physics That’s a phrase that I’m TI: What can we do to address the ones who go out and has a color. taking directly from a these problems? transform institutions. But math professor herself. From my experience Surely, nobody thinks HM: Conservatives have to talk talking with younger unfortunately that physics has a color. about universities not just as generations, I would the STEM But unfortunately economic engines. The discourse say people in their fields are the STEM fields are tends to be exclusively about free 30s or 40s—including now under enormous markets and economic liberty, all conservatives even— now under pressure to hire by of which is very important. Free have been brainwashed enormous race and gender. The markets make possible all of the to a certain extent by pressure idea of meritocracy has prosperity that we take for granted. identity politics. been under attack in But I think conservatives need to I’ve had a to hire the sciences for a long start talking also about culture and conversation with a by race time, but the attack about learning as an end in itself, very, very prominent and gender. has reached a greater to see the purpose of education as conservative-intellectual, intensity now. the passing on of an inheritance and he was adamant that Science education from one generation to another. there is a campus-rape epidemic. Now is being slowed down and watered There is a movement in K-12 of he might be closer to the situation down in the hope of graduating classical academies. Hillsdale than I am, but if this rape epidemic more females and underrepresented College is taking a lead role in trying were happening you would have minorities. Teaching methods to encourage that movement for had a stampede of females out of are being changed, and the parents who want their children colleges rather than into them. But federal government, through the exposed to classical learning, to the fact that he was so reluctant to National Science Foundation and the highest works of literature and write this off, to me, is a sign that the National Institutes of Health, poetry and music and art. That’s an even conservatives are having their is putting enormous pressure encouraging sign. I think donors worldview changed, and I would on chemistry departments and should notice this development say the same thing with the role engineering departments to hire by and try to give that movement that alleged white racism plays in gender and race—above all, gender. more steam.

20 SPRING 2019 THE INSIDER What Will It Take to Control Spending?

BY JONATHAN BYDLAK MIKE KEMP/GETTYIMAGES

THE INSIDER SPRING 2019 21 There are four ways in which you can spend money. You can spend your own money on yourself. When you do that, why then you really watch out what you’re doing, and you try to get the most for your money. Then you can spend your own money on somebody else. For example, I buy a birthday present for someone. Well, then I’m not so careful about the content of the present, but I’m very careful about the cost. Then, I can spend somebody else’s money on myself. And if I spend somebody else’s money on myself, then I’m sure going to have a good lunch! Finally, I can spend somebody else’s money on somebody else. And if I spend somebody else’s money on somebody else, I’m not concerned about how much it is, and I’m not concerned about what I get. And that’s government. —Milton Friedman, interviewed on Fox News, May 2004

UST A FEW YEARS AGO, IT WAS HARD TO FIND In this environment, it’s almost impossible for elected offi- an elected official in either party who didn’t at least pay cials to find meaningful ways to cut spending—even if they J lip service to fiscal conservatism. Everyone, it seemed, wanted to. took the above warning from Milton Friedman seriously—and And it seems not many actually want that at all. Adjusted saw the importance of letting people keep their own money. for inflation, discretionary spending has more than doubled Who can forget the optimistic days of the Tea Party wave, when since 1960, increasingly crowding out private sector alterna- dozens of new representatives and senators swept into office tives in many areas of the economy. The role of government fired up and ready to slash taxes and spending? Even the gritty in people’s everyday lives has grown steadily too, with some standoffs during the Boehner speakership were generally about estimates suggesting that one in three Americans is depen- what the appropriate level of spending reductions should be. dent on government programs in one way or another. Hiking spending was not an acceptable option. In 2019, the party that swept into office just nine short Now, less than 10 years later, those days might as well be a years ago promising to slash spending now basically ignores generation ago. Government spending has never been higher, the issue altogether. The other major party? Well-known fig- reaching historic highs and supported by majorities in both ureheads regularly endorse massive expansions in programs parties. Two-thirds of it is on autopilot with no reforms in like free four-year college and Medicare for All. The political sight, leaping from 31 percent of gross domestic product in discussion has shifted so dramatically that 2020 Democratic 1970 to 62 percent in 2018. presidential candidates attempt to distinguish themselves When Congress does take votes, they tend to be on massive as “moderates” by clarifying that, yes, they do still believe packages rather than individual programs and priorities. It in capitalism. has been over 20 years since Congress even finished its own mandated budget process. Instead, most government spend- What’s the Real Problem? ing is approved at the eleventh hour, wrapped up in thou- A glance at fiscal policy debates in the United States sand-page omnibus bills that must pass in order to avoid a might give the impression that only one thing matters: Debt government shutdown. and deficits.

22 SPRING 2019 THE INSIDER PERCENTAGE WHO SAY REDUCING THE BUDGET DEFICIT SHOULD BE A TOP PRIORITY FOR THE PRESIDENT AND CONGRESS

BUSH OBAMA TRUMP 82

Democrat/ Lean Democrat 66 63 59 53 61 54 58 52 44 38 46 32 41 Republican/ Lean Republican

’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 ’15 ’16 ’17 ’18 ’19

Source: Pew Research Center, February 20, 2019

Politicians on all sides beat their chests about the rising form of inflation or in the form of borrowing. The numbers—as long as the other party is the one running them thing you should keep your eye on is what govern- up. Public opinion polls are much more likely to ask Americans ment spends, and the real problem is to hold down whether they want to deal with debt and deficits—and they do. government spending as a fraction of our income, and That much is obvious and rather consistent across polls and if you do that, you can stop worrying about the debt. over time. Most recently, a POLITICO/Morning Consult survey showed that about half of Americans want reducing deficits to Unfortunately, the status quo is not that concerned with be a top priority for Congress, while a whopping 81 percent of keeping its eye on the true tax. In fact, to the degree that respondents said the issue was important. commentators talk about the causes of debt at all recently, While the level of urgency ebbs and flows (indeed, in 2019, such discussion has focused exclusively on the impact of fewer and fewer seem to care about it anymore), a clear major- the Tax Cuts and Jobs Act. While the act is indeed likely to ity of Republicans and nearly half of Democrats still want reduce future revenue, this narrative ignores the fact that Congress to cut deficits and debt. revenue-to-GDP remains at its historical average and that But there is a problem. government receipts have increased in the months since the Few people want to have a serious discussion about the legislation’s passage. cause of increasing debt and deficits: runaway government Meanwhile, it is difficult even to find many recent spending, and—fundamentally—the expansion of the role of public opinion surveys that ask about government spend- government throughout our lifetimes. ing. That’s not to say the American people are opposed Milton Friedman also famously said: to cutting it: A 2017 Pew poll suggested that 45 percent of Americans still support reining in the size and scope Keep your eye on one thing and one thing only: how of government—with a healthy majority of Republicans much government is spending, because that’s the and right-leaning independents (74 percent) supporting true tax […] If you’re not paying for it in the form of the goal, even if overall support for big government is on explicit taxes, you’re paying for it indirectly in the the rise.

THE INSIDER SPRING 2019 23 But while there might not be overwhelming bipartisan sup- of increased partisanship in the doling out of federal monies port for belt-tightening, the real problem lies with the other and more frequent brinkmanship between the legislature and pressures that politicians face. the executive. It is no secret that countless special interests in Wash- It has gotten to the point that Congress now rarely follows ington are dedicated to getting whatever they can out of the its own process, and with increasing frequency relies upon federal trough. Likewise, we know that elected officials who continuing resolutions (which are bills that freeze spending publicly support any spending cuts can expect a well-funded at its current level for a set amount of time) or omnibus bills and instantaneous backlash claiming that they want to push (which roll all spending together into one package that either grandma off a cliff, make America less safe, or whatever else passes or fails). Most of the time, these packages end up being the lobbyists can come up with. It does not take much before passed at the last minute before a government shutdown, most are scared back into line and back into supporting the after being hammered out mostly in secret and being given status quo. to legislators just a few hours before they have to take a vote. As political scientist David Mayhew famously suggested, The idea of any sort of serious, meaningful spending politicians act as “single-minded seekers of reelection.” They reform coming out of this system is laughable. A growing realize that most of their voters will never know just how majority of spending is not even properly authorized, making much they are voting to spend—and, thanks to special inter- even discretionary spending function more like the manda- ests, will always know if they ever vote to cut a program. The tory programs that are crowding out the budget. choice is unfortunately clear. Yet just last year, when legislators had a chance to fix things It is much easier for politicians to simply continue to make in the Joint Select Committee on Budget Process Reform, the vague promises that they will fight for balanced budgets and best they could do was almost agree to a very modest package limited government, and then do little toward accomplishing of reforms that did not contain a real mechanism for restrain- that goal. Much like a failed dieter going after one last piece of ing spending. chocolate cake over and over again while pledging to start the Clearly, reforming the rules is a necessary but insufficient diet tomorrow, politicians perpetually promise something in step toward fiscal sanity. Even the best rules are effective the future and do the exact opposite in reality. only when those to whom they apply feel compelled to abide by them. Broken Rules and a Rigged Game Let us assume for a moment that the long-suffering fiscal Pulling Back the Curtain conservatives, those beleaguered budget wonks who work The fact is, rules require consequences, and for that reason, in organizations such as The Heritage Foundation and the fixing the rules and even electing new policymakers will make Institute for Spending Reform, are able to convince most pol- no difference if their incentives remain the same. iticians that cutting spending is worth doing. To borrow again from Friedman: Let’s imagine that the champions in Congress are no lon- ger a tireless minority but instead a majority ready to make a [T]he solution to our problem is [not] simply to elect difference. What has to happen next in order for meaningful the right people. The important thing is to estab- reform to become a reality? lish a political climate of opinion which will make it First and foremost, Congress has to fix its rules to allow politically profitable for the wrong people to do the those reforms to happen. right thing. Unless it is politically profitable for the In 1974, coming out of several years of bitter fights with wrong people to do the right thing, the right people President Richard Nixon on what they saw as abuse of exec- will not do the right thing either, or if they try, they utive power, legislators passed the Budget and Impoundment will shortly be out of office. Control Act, more commonly known as the ’74 Budget Act. In addition to creating several agencies and limiting pres- At present, every incentive in Washington is to spend more. idential power, the act created a system in which Congress And that’s because for decades, politicians have been able to passes a budget, a nonbinding roadmap that then guides enter and leave office proclaiming their fiscal conservatism decisions in 12 appropriations committees that deliberate all the while voting for billions upon billions in new spend- on exactly how to allocate federal money to various priorities. ing—and their voters never knew. Recent research by economists Massimiliano Ferraresi, Even experts can find it difficult to figure out exactly what Gianluca Gucciardi, and Leonizio Rizzo has shown that the might be contained in the things Congress passes, and for ’74 Budget Act was successful in keeping spending lower than everyday voters, it is all but impossible. it otherwise might have been. However, like most laws, unin- In order to fix this problem, the Institute for Spending tended consequences slowly revealed themselves, in the form Reform created SpendingTracker.org in 2017. This tool is

24 SPRING 2019 THE INSIDER straightforward: It simply tallies every vote for new spend- voted for the exact same amount of spending that then-Pres- ing or savings. The results confirm what advocates have long ident Obama signed into law. suspected: True fiscal conservatives are few and far between, There are champions in Congress now, just as there have and perhaps always have been. been in the past. But those who are willing to keep spending In the most recent session of Congress, the 115th, only five trillions still remain a clear majority. members in the House—Justin Amash (R-Mich.), Thomas Massie (R-Ky.), Jimmy Duncan (R-Tenn.), Raúl Labrador What’s the Solution? (R-Idaho), and Morgan Griffith (R-Va.)—and two in the Sen- For years, fiscally conservative advocates have cried ate—Rand Paul (R-Ky.) and Mike Lee (R-Utah)—voted to cut about debt crises, only to be mocked when such crises didn’t spending on net. occur. We have spoken of the advantages of the free market and the beauty of supply and demand in abstract terms—all WHO WANTS TO CUT SPENDING? while command and control from Washington has been on the march. Score ▼ Name ▼ Party ▼ In 2019, it seems that fiscal conservatives are at risk of becoming a dying breed, but it does not have to be this way. In fact, success lies in making the issue real and present for Justin Amash -$164,760,000,000 R every American. It lies in linking responsibility to every action House—Michigan and highlighting consequences today, not down the road. Now more than ever, we have the tools to do so. This is not to suggest that we should stop talking about Thomas Massie -$164,601,000,000 R the debt and deficits, but rather, that we do ourselves and our House—Kentucky cause a disservice by allowing those issues to distract from the root of the problem: Runaway spending and an ever- encroaching federal government that knows no limits— Jimmy Duncan -$144,362,780,000 R House—Tennessee regardless of who is in power. We have to make the case that government spends people’s money badly, regardless of whether the books are balanced. Raul Labrador Every government program, no matter how wasteful or -$118,473,180,000 R House—Idaho harmful, will have a well-paid defender materialize once it’s at risk of being trimmed. The task, then, is to balance this pressure with real information on the consequences of gov- Morgan Griffith -$38,186,500,000 R ernment spending and who is responsible for it. House—Virginia In so many walks of life, technology has revolutionized how people think about what is possible. It’s no longer implausible SPENDINGTRACKER.ORG/RANKINGS, accessed March 8, 2019 that autonomous vehicles will replace human drivers, or that hyperloops will reinvent transportation altogether. The world There are, of course, a handful of others who showed of spending policy needn’t be any different. Responsibility restraint. Maybe they did not vote for overall spending cuts, may have been impossible a generation ago, but not now. but they worked to reform spending and spent less than oth- It is ultimately up to us to make the case why our own gen- ers. Overall, though, the picture is bleak. In the 115th Congress, eration—not just future ones—is at risk when government President Trump signed just over $1.7 trillion in new spend- grows beyond its proper scope. We must get real with who’s ing into law. The average politician—in both parties—voted to blame, even if they are on “our side” for other issues. We to approve just over $1.5 trillion. must take advantage of every tool that new technology offers Over time, profligacy is common, too. During his time in to help us hold them accountable. office, President Obama signed into law nearly $8.5 trillion in And we must remember that, as Ronald Reagan warned a spending that otherwise wasn’t slated to occur. As a more spe- decade and a half before he first ran for president, freedom is cific example, in his last two years, he enacted $1.84 trillion in never more than one generation away from extinction. So, too, new spending—of which the median House Democrat voted are strong economies, sound money, and the high standards for $1.81 trillion, and the median House Republican voted for of living that free markets make possible. $1.77 trillion. That’s not exactly a stunning difference. Humorously or sadly—or both, depending on your perspec- Mr. Bydlak is the founder and president of the Institute for tive—current House Minority Leader Kevin McCarthy has Spending Reform, and the creator of SpendingTracker.org.

THE INSIDER SPRING 2019 25 CLASS WARFARE TAXES: ❏❏Are Not Fair, ❏❏Will Not Help the Economy, ❏❏Are Not Needed to Balance the Budget, and ❏❏Will Not Reduce Poverty

BUT THEY WILL GIVE LAWMAKERS MORE POWER— AND THAT’S THE POINT

BY DANIEL J. MITCHELL

26 SPRING 2019 THE INSIDER F PROGRESSIVE POLITICIANS HAVE THEIR The case for such tax increases, however, remains just as way, tax policy will become a new tool of class warfare. faulty as it ever was. Raising marginal tax rates reduces the I Self-described socialists Rep. Alexandria Ocasio-Cor- rewards for productive effort, reduces entrepreneurship, and tez (D-N.Y.) and Sen. Bernie Sanders (D-Vt.) say marginal reduces opportunities—for everybody, rich and poor alike. tax rates should be raised to 70 percent. And Sen. Elizabeth Warren (D-Mass.), who likes to tell entrepreneurs they didn’t The Economics of Marginal Tax Rates build their businesses, has proposed a wealth tax. Numerous To set the stage for this discussion, here are two liberal lawmakers and even some academics on the Left have simple definitions: fallen in line behind such proposals. The justifications for such proposals range from address- ■■ The “average tax rate” is the share of your income taken ing allegedly rising economic inequality, to balancing the by government. If you earn $50,000 and your total tax federal budget, to funding new spending proposals such as a bill is $10,000, then your average tax rate is 20 percent. Green New Deal or Medicare for All. How times have changed. In the 1980s, when Congress ■■ The “marginal tax rate” is the amount of money the gov- got to work writing what became the Reagan tax cuts, Dem- ernment takes if you earn more income. In other words, ocrats who wanted lower tax rates battled Republicans who the additional amount government would take if your wanted even lower tax rates. But both sides understood that income rose from $50,000 to $51,000. high marginal tax rates were harmful, and both parties sought to reduce top tax rates. This led to the bipartisan 1986 Tax These definitions are important because we want to con- Reform Act, which dropped the top tax rate to 28 percent. template why and how higher marginal tax rates discour- Unfortunately, that consensus for lower rates began to age work, saving, investment, and entrepreneurship. When break down soon after President Reagan left office. Some people are considering whether to work harder, work longer, presidents (George H.W. Bush, Bill Clinton, and Barack build assets, take risks, or start businesses, they don’t worry Obama) were willing to raise top tax rates, but it’s noteworthy about average tax rates. that they advocated only incremental increases. And those They consider whether the extra effort will lead to a suf- periodic rate increases were somewhat offset by incremental ficiently large extra reward. The graphic below depicts a cuts under George W. Bush and Donald Trump. hypothetical taxpayer contemplating whether to earn more While there was tinkering at the margins, everybody income rather than enjoy more leisure. seemed to understand that big rate increases would be Taxes discourage production that would otherwise be destructive. As such, radical increases in tax rates were not worth having, and the higher the taxes the greater the lost pro- part of the public debate—until now. duction. Economists call such lost production a “deadweight

HOW TAXPAYERS CONSIDER MARGINAL TAX RATES

Taxpayer with annual income Marginal of $50,000 Tax Rate “Yes, I want to 0% be successful!” “Should I sacrifice “Sure, why not?” leisure 20% to earn “Meh. Not today.” another 50% $1,000?” “No way!”

GETTY IMAGES GETTY 100%

THE INSIDER SPRING 2019 27 BALANCING THE BUDGET WITH MODEST SPENDING RESTRAINT

$8,000

Autopilot Spending $7,000 2.5% Spending 2% Spending 1% Spending Revenue $6,000 BILLIONS $5,000

$4,000

$3,000 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Source: Congressional Budget O ce

loss,” a term for the value that is forgone when something (e.g., 5 percent annually. Reducing red ink merely requires that high taxes, price controls, subsidies) disrupts the markets’ sig- spending grow by less than 5 percent each year. nals, leading producers to make less. These deadweight losses And if lawmakers simply limit spending so that it grows 2.5 expand geometrically as tax rates increase arithmetically. percent per year, which is slightly faster than the projected That’s just a fancy way of saying that the economic damage rate of inflation, then the budget is balanced within 10 years. of increasing tax rates from 40 percent to 50 percent is sig- And if there is even more spending restraint, as illustrated nificantly greater than the damage of boosting tax rates from by this chart, it is possible to balance the budget even faster 30 percent to 40 percent. And pushing marginal tax rates up (see above). to 70 percent will produce significantly greater losses still. 2. CLASS-WARFARE TAX INCREASES Seven Reasons to Say No ENCOURAGE MORE SPENDING. to Class Warfare Taxes Another oft-cited reason for tax increases is that politi- Let’s review some practical reasons why class-warfare tax cians and activists on the Left want more spending. There policy would be misguided. The first two reasons apply to any certainly are plenty of examples to cite, such as the Green tax increases. New Deal, Medicare for All, government-funded child care, and a host of other initiatives floating around Washington to 1. CLASS-WARFARE TAX INCREASES ARE NOT expand the burden of federal spending. NEEDED TO BALANCE THE BUDGET. But tax increases (whether class-warfare tax hikes or gen- Some politicians and activists on the Left openly assert eral tax hikes) also have an indirect impact on spending. In that they want higher burdens on upper-income taxpayers part, this is because politicians realize that tax increases will for reasons of spite and envy. That may even be the primary irritate at least some subset of voters, which means they then motive for most of them. In many cases, though, supporters feel pressure to “give” something to those voters in hopes of of high tax rates claim that they want to generate additional compensating for that angst. revenue to reduce red ink and balance the budget. The alter- Even more important, though, is the late Milton Fried- native to higher revenues, they say, is draconian spending cuts. man’s wise observation that, “In the long run government Even if they are being sincere, this argument is misguided. will spend whatever the tax system will raise, plus as much Based on the new numbers from the Congressional Budget more as it can get away with.” In other words, if we send more Office, it’s quite simple to balance the budget with modest of our income to Washington, politicians will figure out ways spending restraint. Tax revenue is projected to rise by about to buy votes with that money.

28 SPRING 2019 THE INSIDER A RISING TIDE LIFTS ALL BOATS AND WE ALL SUFFER DURING ECONOMIC WEAKNESS

10% Lowest quintile Second quintile 8% Third quintile Fourth quintile 6% Highest quintile

4%

2%

0

-2% IN INCOME BY QUINTILE BY IN INCOME

ANNUAL PERCENT CHANGE ANNUAL -4%

-6% ’68 ’72 ’76 ’80 ’84 ’88 ’92 ’96 ’00 ’04 ’08 ’12 ’16 ’17

Source: Census Bureau

3. CLASS-WARFARE TAX INCREASES HARM larly harmful to economic growth, with consumption ECONOMIC PERFORMANCE. and property taxes less so. This is because economic Now let’s focus on why class-warfare tax increases are growth ultimately comes from production, innovation, particularly damaging to the economy. Revisiting our ear- and risk-taking. lier discussion of marginal tax rates and deadweight loss, the core problem with various soak-the-rich tax hikes is that they To be sure, there are some less-destructive ways of tar- almost inevitably involve imposing greater penalties on pro- geting upper-income taxpayers. When state and local gov- ductive behavior on the part of investors, entrepreneurs, and ernments issue bonds, the interest on those bonds is exempt small business owners. from tax. Eliminating the tax-free status of such “muni bonds” would generate revenue almost solely from the rich. ■■ Higher income tax rates penalize them for earning Eliminating tax preferences is good policy, but ideally the income and creating wealth. revenues from such reforms should be used to finance pro- growth tax reforms, such as lower rates and reduced double ■■ Higher capital gains taxes discourage the most produc- taxation. Otherwise, as noted above, lawmakers will simply tive investments. spend the money on their pet projects.

■■ Higher death taxes penalize growing businesses and 4. CLASS-WARFARE TAX INCREASES FOMENT building capital. SOCIAL DISCORD. The explicit purpose of tax-the-rich schemes is to identify, ■■ Higher corporate taxes penalize job creation and reduce isolate, and demonize a small minority of the American pop- wages for workers. ulation. This “politics of hate and envy” may or may not be a successful political strategy, but it is corrosive. It seeks to That such taxes harm economic growth is pretty well convince ordinary voters that their lives are somehow worse established by the studies that have looked into the matter. because some people are very successful. This is nonsense, A 2012 literature review by William McBride (“What Is the and there is plenty of empirical evidence demonstrating that Evidence on Taxes and Growth?” Tax Foundation) concluded: income trends for the rich, poor, and middle class are strongly correlated. The chart above, based on Census Bureau data, More and more, the consensus among experts is that confirms President John F. Kennedy’s observation that “a taxes on corporate and personal income are particu- rising tide lifts all boats.”

THE INSIDER SPRING 2019 29 1980 TAXES PAID ON INCOME OVER $200,000

1980 Returns 1980 Taxable Income 1980 Income Tax Paid $200,000–$500,000 99,971 $22,696,007 $11,089,114 $500,000–$1,000,000 12,397 $6,512,424 $3,613,195 $1,000,000+ 4,389 $7,013,225 $4,301,111 Total 116,757 $36,221,656 $19,003,420

1988 TAXES PAID ON INCOME OVER $200,000

1988 Returns 1988 Taxable Income 1988 Income Tax Paid $200,000–$500,000 547,239 $134,655,949 $38,446,620 $500,000–$1,000,000 114,652 $67,552,225 $19,040,602 $1,000,000+ 61,896 $150,744,777 $42,254,821 Total 723,697 $352,952,951 $99,742,043

SOURCE: Internal Revenue Service

But there’s another reason to be concerned about the And because they have considerable control over the tim- demonization of upper-income taxpayers. In her Bourgeois ing, level, and composition of their incomes, rich taxpayers Era trilogy, economic historian Deirdre McCloskey docu- can control how much taxable income they are earning and ments that the unprecedented explosion of prosperity in the reporting on their tax returns. So when tax rates go up, they West was largely triggered and enabled by a newfound cul- declare less income to the government. And when tax rates tural appreciation for entrepreneurship. The class-warfare go down, they declare more income to the government. This tax agenda, by contrast, is based on the notion that highly means that punitive tax rates don’t necessarily generate successful people should be targeted, or, as some on the Left a lot of revenue. Or even any revenue. Likewise, low tax argue, taxed out of existence. rates may actually be the best policy to generate more tax revenue. The most famous example may be from the 1980s. 5. CLASS-WARFARE TAX INCREASES According to the Internal Revenue Service’s Statistics of ALMOST NEVER RAISE AS MUCH REVENUE Income, high-earning taxpayers earned and reported far AS PROJECTED. more income after President Reagan and Congress low- When politicians target upper-income taxpayers, they ered the top tax rate from 70 percent to 28 percent. Taxable are going after an elusive target. Unlike ordinary taxpay- income was so much greater that these high earners actually ers, who get the lion’s share of their income in the form of paid far more money to Uncle Sam in 1988 than they did in wages and salaries, rich taxpayers get the vast majority of 1980 (see above). their income from business profits and investment earn- ings. This has enormous implications for tax policy since 6. CLASS-WARFARE TAX INCREASES ordinary taxpayers are less able to change their wages and ENCOURAGE MORE LOOPHOLES. salaries quickly in response to changes in tax rates. But it’s When tax rates increase, the value of a tax preference goes relatively easy for upper-income taxpayers to change busi- up by the same amount. Consider, for instance, the value of a ness operations or their investment patterns in response tax deduction when the tax rate is 20 percent. Taxpayers with to shifts in tax policy. $100 in deductions reduce their tax burden by only $20. But

30 SPRING 2019 THE INSIDER TOP MARGINAL CORPORATE TAX RATES HAVE DECLINED SINCE 1980

60%

U.S. Top Marginal Corporate Tax Rate Worldwide Weighted Average Worldwide Average

50%

40%

30%

20% ’80 ’82 ’84 ’86 ’88 ’90 ’92 ’94 ’96 ’98 ’00 ’02 ’04 ’06 ’08 ’10 ’12 ’14 ’16 ’18

Source: Tax Foundation. Data compiled from numerous sources including: PwC, KPMG, Deloitte, and the U.S. Department of Agriculture.

if the tax rate is 70 percent, then the same $100 deduction now much lower than they used to be, and the fall in corporate suddenly produces tax savings of $70. tax rates is even more dramatic. Countries also have lowered Rising rates create a perverse incentive structure. As taxes on capital gains, and many of them have eliminated death rates go up, deductions become more valuable, which then taxes and wealth taxes (see above). encourages more taxpayers to make decisions that will enable Even though the United States helped start this desir- them to take advantage of those deductions. That reduces the able process, it then fell behind—especially with regards to amount of tax money going to politicians, which encourages business taxation and the tax burden on investment. The them to raise tax rates even further, which simply makes tax 2017 Trump tax plan helped improve America’s competitive deductions even more valuable. In the meantime, lobbyists position, so it would be most unfortunate if a wave of new work to create new deductions because it is so valuable for class-warfare tax increases reversed that reform and pushed taxpayers to protect their money. the United States even further in the wrong direction.

7. CLASS-WARFARE TAX INCREASES Conclusion UNDERMINE COMPETITIVENESS. The new wave of bad tax proposals from major Democratic It upsets some people, but it’s abundantly clear that we now lawmakers unfortunately confirms that the era of bipartisan tax live in a globalized economy. One of the implications is that reform is officially dead. What we don’t know is whether some or investors, entrepreneurs, and businesses can easily choose all of these bad tax policies will be imposed on the U.S. economy. where to invest money and create jobs. There are many factors For the sake of workers, investors, and entrepreneurs, let’s that influence that decision, but tax policy plays a key role. hope the answer is no. In recent decades, globalization has encouraged and enabled a very virtuous cycle of tax competition. It started when Ronald Mr. Mitchell is a co-founder and chairman of the Center Reagan and Margaret Thatcher slashed tax rates in the United for Freedom and Prosperity. He is the co-author, with Chris States and the United Kingdom, respectively; the tax-cutting Edwards, of Tax Revolution: The Rise of Tax Competition and trend has since spread all over the world. Personal tax rates are the Battle to Defend It (Cato Institute, 2006).

THE INSIDER SPRING 2019 31 Who Taught Citizens to Think of Themselves as Victims?

BY MIKE GONZALEZ

HE POLITICAL AND SOCIAL CONFLICTS which in turn has created pathologies that are changing the dividing America today are rooted in a shift in think- American character. T ing that occurred in the previous century. That shift We used to say that American politics was played within concerns our understanding of the inherent tension between the 40-yard lines, and it was largely true. Within those hash freedom and equality. The divisions have broken up the rough marks was the “liberal consensus” written about by the noted consensus that used to exist in America. social scientist Louis Hartz, whose work influenced a genera- Love of liberty remains a constant in America, even if tion. By liberal, of course, he and the many he inspired meant now some on the Left love it only in areas where it means what we call today “classical liberalism”—i.e., a respect for unbounded pleasure-seeking and want to constrain freedom individual freedom, private property, consent of the governed, where it delivers material rewards. Yet, it is in the definition self-preservation, and equality under the law. of equality that the biggest and most damaging change has Whatever one may think of what Hartz wrote, it is true that happened. A new meaning of the concept has prompted a we had never (until recently) had strong socialist or reaction- dramatic growth in government intervention into our lives, ary political forces, at least not in the class-based way they are

32 SPRING 2019 THE INSIDER understood in Europe and Latin America. Failure was seen it?) was the first to come up with the horserace analogy. as the Puritans saw it, often the result of personal flaws and In 1909 he wrote: something about which to be ashamed, and not as Europeans saw it, as a consequence of the class into which one was born. The democratic principle requires an equal start in There have always been critics of the American system, the race, while respecting at the same time an unequal to be sure, especially about a century ago when the Pro- finish. But Americans who talk in this way seem wholly gressives and Transnationalists were numerous among blind to the fact that under a legal system that holds intellectuals. Yet, they were fringe elements, even under private property sacred there may be equal rights, the progressive Presidents Theodore Roosevelt and Wood- but there cannot possibly be any equal opportunities row Wilson, and were not to have an impact on the way the for exercising such rights. country was run till after mid-century. Until then, America was largely ideology-free. Attachment to freedom (in Hartz’s Croly thus sets up equality in opposition to other freedoms, words, “an irrational attachment to freedom”) was about starting with property. all we had. James Traub writes that, at this point, “the trunk of liber- Our institutions, from the media to the academy, reflected alism now separated into two boughs.” One went with Fried- that broad consensus. Until mid-century or thereabouts, erich Hayek and the other with Isaiah Berlin. writes the media critic Robert Lichter: President Franklin Delano Roo- sevelt’s New Deal changed the rela- [L]iving within the framework tionship of government to the citizen of a broad ideological consensus, in the 1930s, but dependence on gov- American newsmen, like most President Franklin ernment programs did not really other Americans, found it diffi- Delano Roosevelt’s get going until President Lyndon B. cult to recognize that their view Johnson put interventionism on tes- of the world might be shaped by a New Deal changed tosterone. The footprint of the wel- particular set of premises, a para- the relationship fare state in 1961 was not dramatically digm or Weltanschauung, which of government larger than it was under FDR or even strongly influenced their view of to the citizen in Hoover: Total entitlement transfers to social causation and hence their individuals accounted for less than 5 view of what the facts were […] the 1930s, but percent of gross domestic product. By News and entertainment took the dependence 2015, that figure had nearly tripled— hue they did largely because pub- on government to 14 percent—with over a third of the lishers and most reporters believed population receiving needs-based that was the way it was and should programs did not benefits from the government. Today be. Key elites in American society really get going entitlement transfers claim 21 percent accepted the broad framework of until President of GDP. the American ideological consen- When the Great Society was sus, and most did not even realize Lyndon B. Johnson launched in 1965, transfer payments that there might be other ways of put interventionism to individuals were 30 percent of gov- looking at the world. on testosterone. ernment outlays. By 1975 they had risen to 50 percent, and in 2017 they The consensus breaks up when the accounted for 72 percent of the fed- meaning of equality begins to trans- eral budget. mogrify. The inherent tension between equality and freedom The difference then is not so much the New Deal, but the was much more manageable when the goal was equality Great Society. And it shouldn’t surprise us that in his speech of opportunity and not of outcome, and when the evil to launching his ambitious domestic agenda, Johnson made use eradicate was disparate treatment, not disparate impact. of Croly’s horserace analogy: The social scientist Irving Louis Horowitz calls the new departure “neo-liberalism.” Many writers believe this begins You do not take a person who, for years, has been to happen as a result of one of liberalism’s achievements: the hobbled by chains and liberate him, bring him up Industrial Revolution, which produced incredible wealth, to the starting line of a race and then say, “You are but also a worker class. The American progressive Herbert free to compete with all the others,” and still justly

KEITHBISHOP/GETTYIMAGES Croly, the founding editor of the New Republic (New, get believe that you have been completely fair. Thus it

THE INSIDER SPRING 2019 33 is not enough just to open the gates of opportunity. [T]he old liberalism assumed that individuals required All our citizens must have the ability to walk through a common starting place to such betterment and those gates. This is the next and the more profound advancement. […] [N]eo-liberalism soon developed stage of the battle for civil rights. We seek not just its own momentum in a post-Hartzian universe. It freedom but opportunity. We seek not just legal equity was a strategy that differed markedly from classical but human ability, not just equality as a right and a liberalism. It came to identify itself with a new set theory but equality as a fact and equality as a result. of outcomes, defined and determined by differen- [Italics added.] tial weights for different people, again, much like a horse in handicap races. Artifacts to impede their The identity politics and victimhood culture that are so speed would weigh down good horses, while slower devastating to the American character today got their start horses would escape such an outcome, and indeed when Leftist activists in the late 1960s pushed for analo- be given incentives precisely because they are slower gizing the experience of black Americans—for whom the out of the gate. civil rights movement was solely intended—to other groups in society. The Census Bureau created the first National As the late, great Robert Bork explained, modern liber- Advisory Committee on Race and Ethnicity in 1974. Pres- alism allows individual freedom only in areas of life where ident Richard Nixon, distracted by the Watergate scandal, “there is no danger that achievement will produce inequality appointed a director of the bureau and people wish to be unhindered in who was susceptible to intimida- the pursuit of pleasure[—]sexuality tion by activists from the National and the popular arts.” In areas where Council of La Raza and other eth- individual liberty produces inequality, nic-identity groups financed by the Equality of the imperative of equality of outcome Ford Foundation. This move was not produces coercion in the form of quo- a reaction to immigration; the immi- outcome tas, affirmative action, etc. Equality gration law of 1965 had not yet had a necessarily of outcome, Bork observed, “neces- demographic impact. The percentage presses us sarily presses us toward collectivism, of the foreign born in America in 1974 because a powerful state is required was around 4.6 percent—a historic toward to suppress the differences that free- low compared to all the years from collectivism, dom produces.” 1850 to the present. because a According to modern critics of Many of our ills—from the breakup powerful state the Enlightenment, such as Bork and of America into warring tribes to the Yoram Hazony, the seed of liberalism’s collapse of the family, from the rise is required to destruction resided within its birth. in out of wedlock births to the Marx- suppress “Liberalism always had the tendency ist takeover of the culture-making the differences to become modern liberalism,” Bork industries—are linked to, if not the writes. “The difference was that clas- direct of result of, the skyrocketing of that freedom sical liberalism, the glory of the last government spending as a percentage produces. century, was not simply a form of of GDP. liberalism but an admixture of lib- “The corrosive nature of mass eralism’s drives and the forces that dependence on entitlements is evi- opposed those drives.” dent from the nature of the pathologies so closely associated Modern liberalism, he adds, “is powerful because it has with its spread,” writes Nicholas Eberstadt. There’s no hope enlisted our cultural elites, those who man the institutions of it ending soon because “[t]he incentive structure of our that manufacture, manipulate and disseminate ideas, atti- means-based welfare state invites citizens to accept benefits tudes and symbols[—]universities, churches, Hollywood, the by showing need, making the criterion for receiving grants national press (print and electronic), foundation staffs, the demonstrated personal or familial financial failure, which ‘public interest’ organizations.” used to be a source of shame.” Bork’s solution is to “rebuild the constraints that once In turn, this ballooning welfare spending arises from the made liberalism classical liberalism.” split in liberalism and the new belief that “equity” requires Can we do that? “equality as a result.” As Horowitz writes, the racetrack met- aphor” meant that: Mr. Gonzalez is a fellow at The Heritage Foundation.

34 SPRING 2019 THE INSIDER The Enemies of Free Speech Are Targeting the Internet BY MATT NESE AND LUKE WACHOB

CENTRAL IDEA BEHIND THE FIRST In 2017, a number of senators, led by Amy Klobuchar Amendment’s protection of free speech is that a free (D-Minn.), introduced the “Honest Ads Act” in response A marketplace of ideas better serves the search for truth to revelations that the Russian government attempted to than does a small elite armed with the power of censorship. spread disinformation on the internet to American voters Accordingly, the solution to bad speech is more speech, not during the 2016 election. The previous Congress did not less. That theory, however, is being set aside by lawmakers pass the bill, but it was reintroduced in the Senate in May determined to make sure that no citizen’s political opinions 2019 and may yet pass. The bill seeks to extend to the inter- are manipulated by foreign powers peddling fake news on net the kind of reporting requirements found in campaign

GUIDO CAVALLINI/GETTYIMAGES the internet. finance laws.

THE INSIDER SPRING 2019 35 Klobuchar appeared on “Meet the Press” in February 2018, what-you-like nature helped Trump defeat Hillary Clinton to discuss the bill. So focused was host Chuck Todd on the despite being outspent 3-to-1. threat of fake news, that he neglected to ask Klobuchar any Where the internet was once an afterthought for politi- question raising First Amendment concerns. He did ask, how- cos, online strategies are now a core component of most cam- ever, if the government should fine social media companies paigns. Key to this evolution was a bipartisan recognition that that fail to remove automated accounts, or “bots.” Klobuchar the internet should not be heavily regulated like television and said: “I think that would be a great idea.” radio—after all, the internet is not like television and radio. But there are First Amendment concerns aplenty about While advocacy for or against a candidate had been regu- the bill. It makes it financially expensive and legally risky lated since the 1970s, the Bipartisan Campaign Reform Act for all but the largest organizations of 2002 went further to regulate tele- to speak on the internet on matters of vision and radio ads that simply name public importance. To prevent a few a candidate near an election. Groups bad actors from spreading lies, the bill that spend over $10,000 in a calendar chills virtually all sponsored political To prevent year on such ads and reach an audi- speech online. a few bad ence of at least 50,000 people now actors from must register with the government, From Information file complex reports documenting Superhighway spreading lies, their spending and the identities of to Information the Honest some of their supporters, and include Checkpoint Charlie Ads Act lengthy disclaimers in their commu- To understand the truly breath- nications. States have their own laws taking changes being proposed by chills virtually regulating political speech, which Klobuchar and others, consider the all sponsored often expose the names and home laissez-faire history of political advo- political addresses of Americans who support cacy on the internet. Online cam- groups that mention elected officials paigning was barely on the radar the speech in the context of discussing policy last time Congress overhauled federal online. issues. Complying with the various campaign finance laws in 2002. That state and federal regulations raises turned out to be a blessing. the cost of speaking, but the rules are The first candidate to be widely credited with a successful at least limited to groups spending large sums to reach large online operation was Howard Dean two years later, in his run audiences in the period leading up to an election. for the Democratic nomination for president. Though Dean’s By contrast, the cost of promoting a message on the inter- campaign flamed out memorably, his online success became net is nowhere near as high as a major television advertising a model for others. In 2008, Barack Obama won not only the campaign. As a result, proposals to regulate online speech Democratic nomination but the presidency on a campaign typically start at much lower thresholds for spending, and that used digital tools heavily. Notably, this development was therefore affect much smaller groups. And unlike the typical cheered, not criticized, by the mainstream media. 30-second ads we see on television, the internet offers the Democrats may have been first to capitalize on the inter- potential for speech to come in all different shapes, sizes, net’s potential but make no mistake: Conservatives use the and formats. This variety in advertising frustrates efforts to internet to support their causes as well. impose TV-like disclaimer and reporting requirements on Just as President Obama’s supporters turned to the inter- online speech. net to mobilize, so did his critics. Conservative leaders and In addition, internet content is often interactive: It asks pundits reached larger audiences than ever before through users to participate in polls; it allows them to rate content; it YouTube and right-leaning blogs. Conservative advocacy invites them to comment; and it almost always provides links groups and government watchdogs created Facebook pages for users to get more information. The nature of advertising to get closer to their supporters. Local activists turned to on the internet is also ever-changing with new technologi- Twitter and Reddit to spread their messages. New data tools cal innovations and new ways of reaching people. Regulators empowered groups of all beliefs to identify and reach out to should not stifle future innovation with a one-size-fits- potential supporters at low cost. all approach. By the 2016 election, Republican nominee Donald Trump These points used to carry the day when restrictions on was being propelled to success, in part, by a strong social internet speech were proposed, but a funny thing happened media strategy. The internet’s low cost and interactive, share- after Trump’s unexpected victory in the 2016 election. Atti-

36 SPRING 2019 THE INSIDER THE SENATE JUDICIARY SUBCOMMITTEE on Crime and Terrorism holds a hearing on “Extremist Content and Russian Disinformation Online” on Oct. 31, 2017.

tudes toward the internet began to sour. Instead of continuing your local pro-life group, the taxpayers’ association in your to celebrate its success in elevating new voices, now critics town, or even the National Rifle Association. attacked the internet as untrustworthy and in need of gov- ernment oversight. The revelation that Russian groups had How Bills Regulating Internet Speech purchased a small amount of politically charged online ads Threaten the First Amendment for roughly $100,000—0.01 percent of the $1.4 billion in digi- A closer look at the “Honest Ads Act” reveals it is noth- tal ad spending in the 2016 election cycle—fanned the flames ing like its marketing suggests. Rather than a defense against for intervention. foreign meddling in elections, the bill applies to Americans This negligible amount of Russian spending, and the laugh- who use the internet to speak with other Americans about able “memes” they produced, became a justification for old political affairs and the issues of the day. It has gone nowhere enemies of free speech to rally around a new cry: Regulate in Congress, so far, but it has inspired a plethora of state-level the internet! imitators—some of which have been signed into law. These There are always powerful politicians and activist groups bills represent some of the most serious threats to free speech seeking to control debate. In recent years, their efforts have rights today. focused on silencing advocacy nonprofits through donor dis- The basic structure of these online speech laws is the closure laws. These laws expose the names, home addresses, same. Each expands the types of ads regulated by the gov- and even the employers of Americans who financially support ernment, often going so far as to regulate any paid ads about advocacy groups that speak out in support of a cause. It’s a way any “national legislative issue of public importance.” The bills for government, activists, and even crazed individuals to track frequently require inflexible disclaimers that could make

DREW ANGERER/GETTY IMAGES DREW ANGERER/GETTY and possibly harass supporters of particular causes. Think of many smaller online ads impractical. Especially as online

THE INSIDER SPRING 2019 37 COLIN STRETCH, GENERAL COUNSEL AT FACEBOOK, Sean Edgett, acting general counsel at Twitter, and Richard Salgado, director of law enforcement and information security at Google, testify at a Senate Judiciary Subcommittee on Crime and Terrorism hearing on “Extremist Content and Russian Disinformation Online” on Oct. 31, 2017 technology continues to develop, it may be impossible for and the platform (Facebook, Twitter, your local newspaper) speakers to comply with these static disclaimer require- that accepts it—must report detailed information such as how ments. The bills would also require groups running political much the ad cost, to whom they promoted it, how many views and issue ads to file complex reports with the government— it generated, a list of the group’s Board members and officers, sometimes including donor disclosure (surprise, surprise). and other minutiae. Studies suggest these reports are of little Of course, there are substantial fines and penalties for viola- value to voters, but they serve as roadmaps for a group’s oppo- tions, even minor ones, and the potential for politically moti- sition. Knowing exactly what a group is saying, to whom, and vated investigations. at what cost can be tremendously valuable to savvy political The end result? The internet would become less useful to operatives trying to halt their progress. Unfortunately, with grassroots campaigns and average Americans trying to speak. the threat of government action looming in the background, At the same time, such restrictions would pose little obstacle companies like Facebook and Twitter have begun construct- to well-funded interest groups and candidate campaigns; they ing these databases themselves. can better afford to pay for the legal guidance needed to navi- While the Honest Ads Act has not yet become law, it has gate a more heavily regulated internet. been the model for numerous state bills regulating speech On top of all that, online speech bills typically include a on the internet. In 2018, Colorado, Idaho, Maryland, New

“public file” requirement, whereby the group running the ad— York, North Carolina, Vermont, Virginia, and Washing- IMAGES DREW ANGERER/GETTY

38 SPRING 2019 THE INSIDER ton all considered bills modeled after the Honest Ads Act. Saving Free Speech Online Maryland, New York, and Washington did pass such bills The fight to save free speech online puts conservatives in into law. This year, Colorado, Connecticut and North Car- an unusual position. Silicon Valley has a reputation for lean- olina are considering bills similar to the Honest Ads Act. ing left, and accusations that platforms are biased against con- Those bills either impose new disclaimer rules on inter- servatives are a common topic of discussion in right-leaning net ads, require internet platforms to publish information media. However, if the government is allowed to regulate about ad-buyers, or regulate online ads as electioneer- political speech online, the situation will get far worse for ing communications. grassroots campaigns of all stripes. As Ronald Reagan once In Maryland, the law is so impossibly broad that it cov- quipped, the nine most terrifying words in the English lan- ers online speech that merely “relates guage are: “I’m from the government, to” a candidate, prospective candidate, and I’m here to help.” ballot question, or prospective ballot This new front in the battle for free question. So, virtually any political speech should unite Americans of all speech online may fall within its drag- Without an backgrounds. If foreign governments net. In Washington, bureaucrats made are trying to interfere in our elections, an already bad law even more complex internet free state campaign finance laws aren’t the by requiring platforms to provide “the from government solution. Does anyone really believe geographic location and audience tar- interference, the the Russians or the Chinese are going geted” by the ad and “the total num- to obey American campaign finance regu- ber of impressions.” The restrictions marketplace of lations anyway? The federal government in Maryland and Washington were so ideas is less open has agencies that specialize in dealing severe that tech giant Google decided to and much smaller. with hostile actors online, and burden- stop running state-level political ads in In order for the ing Americans’ free speech rights with both states, at least temporarily, while a litany of regulations will not make it Facebook announced it would no lon- internet to continue easier for them to do their jobs. ger accept political ads in Washington to organize and Not since the introduction of the in order to avoid violating its new reg- motivate Americans printing press has there been a tool ulations. If these two tech behemoths that has so drastically changed the way have difficulty complying with these in public life, it we communicate with one another. The laws, smaller outlets will never be able must remain free internet is where many Americans go to meet the law’s requirements. from heavy-handed to share their views and learn about Maryland Gov. Larry Hogan declined the views of others. It is where they go to sign his state’s online speech law, regulation. to organize petitions, rallies, and voter noting its First Amendment problems. registration drives. It is one of the main However, he allowed the measure to sources for information about govern- become law without his signature. Sure enough, a lawsuit was ment, public policy, and elections. Without an internet free quickly filed by a coalition of media organizations, including from government interference, the marketplace of ideas is The Washington Post and The Baltimore Sun. They argue less open and much smaller. In order for the internet to con- Maryland violated their First Amendment rights by forc- tinue to organize and motivate Americans in public life, it ing them to publish information about their advertisers and must remain free from heavy-handed regulation. contend that the law imposes unfair burdens on the media. More proposals to regulate online speech laws are In early January, a federal judge issued a thorough opinion sure to come in 2019 and beyond, both in Congress and in casting doubt on the constitutionality of Maryland’s law, but states across the country. Now is the time for defenders of the challenge is still working its way through the legal process. free speech to be vigilant against efforts to restrict speech If these and similar efforts to restrict online political online. Otherwise, we will find we have lost our rights—and speech are successful, we may lose the internet as a vibrant our voices! space for discussion about government and candidates. The legacy of the internet as a space for new voices and a coun- Mr. Nese is the director of external relations at the Insti- terweight to television and radio could one day be a mere tute for Free Speech, the nation’s largest organization dedicated memory. In its place would be yet another highly-regulated, solely to defending First Amendment political speech rights. expensive media platform dominated by big companies, Mr. Wachob is the communications director at the Institute for well-heeled D.C. insiders, and expensive lawyers. Free Speech.

THE INSIDER SPRING 2019 39 MAY Why Is College So Pricey? Theories 29 Compete! Cato Institute, Washington, After the Fanfare: Family First One D.C., 4 PM 23 Year Later, American Enterprise Institute, Washington, D.C., 11 AM Racial Discrimination in the Harvard 29 College Admissions Process, Negotiating with China During Federalist Society, Great Southern Club 23 Peacetime, Crisis, and Conflict, Hancock Whitney Bank Building, Gulfport, American Enterprise Institute, Washington, Miss., 11:45 AM D.C., 2:30 PM The Diversity Delusion, Federalist America’s Future Foundation Annual 29 Society, 3 West Club, New York, 7 PM 23 Gala and Buckley Awards, Nationals Park, Washington, D.C., 7 PM DC Book Party with Robby Soave, 30 Reason Foundation, Washington, Canterbury Medal Gala, Becket Fund, D.C., 6 PM 23 Pierre Hotel, New York, 6 PM

The Wealth Explosion: The Nature JUNE 23 and Origins of Modernity, Cato Tiananmen Square Massacre Candlelight Institute, Washington, D.C., Noon 3 Vigil, Victims of Communism Memorial Foundation, Corner of New Jersey Avenue, “You Can Say That” with David NW, and Massachusetts Avenue, NW, 23 French, Georgia Public Policy Washington, D.C., 8:30 PM Foundation, Georgian Club, Atlanta, 11:30 AM Tiananmen Square Massacre Rally of Trumponomics, Heartland Institute, 4 Remembrance, Victims of Communism 23 Arlington Heights, Ill., 5:30 PM Memorial Foundation, United States Capitol West Lawn, Washington, D.C., 1:30 PM Protecting Free Speech on Campus, 23 Maine Heritage Policy Center, DiMillo’s Europe’s Economic Challenge after the on the Water, Portland, Maine, Noon 4 Parliamentary Election, American Enterprise Institute, Washington D.C., 2 PM – 4 PM World Taxpayers 23-26 Conference, World Battleground of Perception: Countering Taxpayers Association, Aerial UTS Function 4 Threats to Free and Open Societies, Center, University of Technology Sydney Hoover Institution, Hauck Auditorium, Stanford University, 4:30 PM Oslo Freedom Forum, 27-29 Oslo Book Talk and Signing with Author 4 Richard Vedder, Texas Public Policy The Once and Future Worker, Foundation, Austin, 11:30 AM 28 Federalist Society, Davenport Press, Mineola, N.Y., 6 PM Bridging the Divide Summit, 5 American Enterprise Institute, Westin National Review Institute’s Denver Downtown 28-29 Ideas Summit, Mandarin Oriental, Washington, D.C. The G20 and the Global Economy: A 5 Conversation with International Monetary Resource Bank, The Heritage Fund Managing Director Christine Lagarde, 28-31 Foundation, Westin Kierland American Enterprise Institute, Washington, Resort, Scottdale, Ariz. D.C., 3 PM

40 SPRING 2019 THE INSIDER The Imagery of Freedom, Cato Institute, The Principles of Liberty, 5 Washington, D.C., 6:30 PM 12-16 Intercollegiate Studies Institute, Wilmington, Del. Benjamin Franklin and the Crisis of the 5 British Empire, Foreign Policy Research Summer Session with Dr. Samuel J. Institute, Museum of the American Revolution, 13 Abrams, James G. Martin Center for Philadelphia, Pa., 6 PM Academic Renewal, Carolina Country Club, Raleigh, Noon “No Safe Spaces” Advanced Screening, 5 Heartland Institute, Arlington Heights, Ill., State of the Taxpayer Tour—Dallas, Texas 5:30 PM 13 Public Policy Foundation, Arlington Hall at Turtle Creek Park, Dallas, 7:45 AM The Price of Auto Insurance: A Barrier to 5 Economic Mobility, Mackinac Center for State of the Taxpayer Tour—Houston, Public Policy, Radisson Hotel Lansing at the 13 Texas Public Policy Foundation, Capitol, Lansing, Mich., 11:30 AM The Houston Club, Houston, 11:30 AM

2019 Arizona Supreme Court Review, State of the Taxpayer Tour—The 6 Federalist Society, Helio Basin Brewing 13 Woodlands, Texas Public Policy Company, Phoenix, 6 PM Foundation, Jaspers, The Woodlands, Texas, 5:30 PM Economics in the Real World, 6-9 Foundation for Economic FeeCon, Foundation for Education, Emory University, Atlanta, Ga. 13-15 Economic Education, Marriot Marquis, Atlanta New Mexico: What’s Next for Our State’s 8 Economy and Politics? Rio Grande What’s Wrong with the Universities Foundation, Pasta Paradiso, Los Alamos, Noon 14 and Can They Be Fixed? Pacific Research Institute, University Club of San Prisoners of Politics: Breaking the Francisco, 11:30 AM 10 Cycle of Mass Incarceration, Federalist Society, Cafeteria 15L, Sacramento, Noon Roll Call of Nations Wreath Laying 14 Ceremony, Victims of Communism The Conservative Sensibility: A Memorial Foundation, Victims of Communism 11 Conversation Between George Will and Memorial, Corner of New Jersey Avenue, NW, Robert Doar, American Enterprise Institute, and Massachusetts Avenue, NW, Washington, Washington, D.C., 5:30 PM D.C., 9 AM

Financial Inclusion: The Cato Summit Mutual Funds, Public Employees, 12 on Financial Regulation, Cato Institute, 18 Public Pensions, Securities, Social Washington, D.C., 9 AM – 2 PM Justice, Environmental Policy, American Enterprise Institute, 10 AM - Noon Putting a Price on Life: The Coming 12 Fight Over Government Rationing Is Basic Income the Solution for of Medical Care, Mackinac Center for Public 18 Rising Poverty and Tech Industry Policy, Radisson Hotel Lansing at the Capitol, Displacement? Pacific Research Institute, Lansing, Mich., Noon Neyborly, San Francisco, 5:30 PM – 7:30 PM

State of the Taxpayer Tour—San The Big Three: Roosevelt, Stalin, and 12 Antonio, Texas Public Policy 18 Churchill During the Second World Foundation, San Antonio Country Club, War, Hoover Institution, Hauck Auditorium, 11:30 AM Stanford University

THE INSIDER SPRING 2019 41 State of the Taxpayer Tour—Fort JULY 18 Worth, Texas Public Policy Foundation, The Fort Worth Club, Fort Worth, Noon National Fourth of July Conservative 4 Soiree, Leadership Institute, State of the Taxpayer Tour—Abilene, Occoquan Regional Park, Lorton, Va. 18 Texas Public Policy Foundation, Beehive 11 AM – 3 PM Restaurant, Abilene, Texas, 5:30 PM Think Like an Entrepreneur, State of the Taxpayer Tour—Midland, 9-12 Foundation for Economic 19 Texas Public Policy Foundation, Petroleum Education, Northwood University, Club of Midland, Midland, Texas, 11:30 AM Midland, Mich.

High School Conference at National High School 19-22 the Reagan Ranch, Young 10-13 Leadership Conference, America’s Foundation, Reagan Ranch Center, Young America’s Foundation, National 4-H Santa Barbara, Calif. Conference Center, Chevy Chase, Md.

Competitive Enterprise Institute 35th Economics in the Real World, 20 Anniversary Dinner and Reception, 11-14 Foundation for Economic Marriot Marquis, Washington, D.C., 6 PM Education, University of Arizona, Tucson, Ariz.

Economics in the Real Civil Society in Uncivil Times: 20-23 World, Foundation for 13-19 How Does Civil Society Economic Education, Chapman University, Impact Individual Freedom? Institute Orange, Calif. for Humane Studies, Davidson College, Davidson, N.C. Supreme Court Roundup, Federalist 22 Society, California Chamber of Sphere Summit: Teaching Commerce, Sacramento, Noon 14-18 Civic Culture Together,  Cato Institute, Washington, D.C. The SEC, Entrepreneurship, FinTech 25 and the Economy, The Heritage Think Like an Entrepreneur, Foundation, Washington, D.C., Noon. 16-19 Foundation for Economic Education, Lindenwood University, St. Louis State of the Taxpayer Tour—Austin, Texas 27 Public Policy Foundation, Austin, 11:30 AM FreedomFest, Paris Resort, 17-20 Las Vegas Latin American Liberty 27-28 Forum, Atlas Network, Leadership in Action, Intercontinental Real Santo Domingo 23-26 Foundation for Economic Education, St. Edward’s University, Austin How Central Planning 27-28 Affects Communities, National Institute for Humane Studies, San Francisco 7/29-8/3 Conservative Student Conference, Young America’s Leadership in Action, Foundation, Renaissance Hotel, 27-30 Foundation for Economic Washington, D.C. Education, Stetson University, Orlando Leadership in The Fund for American 7/30-8/2 Action, Foundation 27-30 Studies Annual Conference, for Economic Education, University of 775 12th Street, NW, Washington, D.C. Denver, Denver

42 SPRING 2019 THE INSIDER Economic Freedom Is Good for the Environment Freer economies, as measured by the 2019 Heritage Index of Economic Freedom, have better environmental results, as measured by Yale University’s 2018 Environmental Performance Index.

Environmental Performance Index Score

76.1 69.5 60.8 49.5 47.8

REPRESSED MOSTLY MODERATELY MOSTLY FREE UNFREE FREE FREE

Category in the 2019 Index of Economic Freedom

NOTE: Represented are the 176 countries that are in both the 2019 Index of Economic Freedom and the 2018 Environmental Performance Index. SOURCE: Terry Miller, Anthony B. Kim, and James M. Roberts, 2019 Index of Economic Freedom, The Heritage Foundation, p. 29. (https://www.heritage.org/index/download).

THE INSIDER SPRING 2019 43 NON-PROFIT U.S. POSTAGE PAID TWIN CITIES, MN PERMIT NO. #29418

«Primary Addressee» «Address Line» «City», «State» «Zip»

When did America start obsessing over group identity? resident Lyndon Johnson’s Great Society program Pdidn’t just expand government; it shifted the purpose of government—from enforcing equal rules for all to pursuing equal results for all. The goal, he explained in 1965, was “not just equality as a right and a theory but equality as a fact and equality as a result.” A bigger, more interventionist state confers greater rewards on those who organize for the benefit of its members. Thus, it should come as no surprise that our national identity has become fractured as the federal role has expanded. To learn more, read our article beginning at page 32.

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