Arne Duncan Embraces False Friedman

Posted by Neal McCluskey

In a shocking development, U.S. Secretary of Arne Duncan embraced the ideas of Milton Friedman today, championing the funding of students instead of schools! Unfortunately, it was in the context of higher education — Duncan and his boss have done all they can to destroy school choice elsewhere — and he completely misrepresented what Friedman said about higher ed, suggesting that the Nobel Laureate somehow endorsed the federal Direct Loan Program:

We will end the loans under the Federal Family Education Program and make them directly to students — just as economist Milton Friedman proposed 50 years ago, and just as the Department of Education has been doing since 1993 through the Direct Loan Program.

Were Milton Friedman still with us, I think he would be pretty miffed with Duncan. For one thing, 50 years ago there was no Federal Family Education Loan Program. Moreover, assuming Duncan is referring to Friedman’s “The Role of Government in Education,” Friedman was clearly stating that if there is going to be any higher education aid it should go to students, not schools. And then there’s this:

The resulting system would follow in its broad outlines the arrangements adopted in the United States after World War II for financing the education of veterans, except that the funds would presumably come from the States rather than the Federal government [italics added].

It’s bad enough that Duncan and his boss reject Friedman’s very wise and proven counsel when it comes to elementary and secondary education. It’s even worse that Duncan then has the gall to blatantly lie about what Friedman wrote in an effort to sell a rotten and costly piece of federal legislation, the laughably titled Student Aid and Fiscal Repsonsibility Act.

Neal McCluskey • February 22, 2010 @ 11:44 am
Filed under: Education and Child Policy

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Today’s White House ‘Jobs Summit’

Posted by Roger Pilon

Today’s Politico Arena asks:

The WH Jobs Summit: “A little less conversation? A little more action? ( please)”

My response:

Today’s White House “jobs summit” reflects little more, doubtless, than growing administration panic over the political implications of the unemployment picture.  With the 2010 election season looming just ahead, and little prospect that unemployment numbers will soon improve, Democrats feel compelled to “do something” — reflecting their general belief that for nearly every problem there’s a government solution.  Thus, this summit is heavily stacked with proponents of government action.  This morning’s Wall Street Journal tells us, for example, that “AFL-CIO President Richard Trumka is proposing a plan that would extend jobless benefits, send billions in relief to the states, open up credit to small businesses, pour more into infrastructure projects, and bring throngs of new workers onto the federal payroll — at a cost of between $400 billion and $500 billion.”  If Obama falls for that, we’ll be in this recession far beyond the 2010 elections.
 
The main reason we’re in this mess, after all, is because government – from the Fed’s easy money to the Community Reinvestment Act and the policies of Freddy and Fannie — encouraged what amounted to a giant Ponzi scheme.  So what is the administration’s response to this irresponsible behavior?  Why, it’s brainchilds like ”cash for clunkers,” which cost taxpayers $24,000 for each car sold.  Comedians can’t make this stuff up.  It takes big-government thinkers.
 
Americans will start to find jobs not when government pays them to sweep streets or caulk their own homes but when small businesses get back on their feet.  Yet that won’t happen as long as the kinds of taxes and national indebtedness that are inherent in such schemes as ObamaCare hang over our heads.  Milton Friedman put it well:  “No one spends someone else’s money as carefully as he spends his own.”  Yet the very definition of Obamanomics is spending other people’s money.  If he’s truly worried about the looming 2010 elections (and beyond), Mr. Obama should look to the editorial page of this morning’s Wall Street Journal, where he’ll read that in both Westchester and Nassau Counties in New York — New York! — Democratic county executives have just been thrown out of office, and the dominant reason is taxes.  Two more on the unemployment rolls.
Roger Pilon • December 3, 2009 @ 1:15 pm
Filed under: General; Government and Politics

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Dancing on Cash for Clunkers’ Grave

Posted by Tad DeHaven

My colleague Chris Edwards called the government’s “Cash for Clunkers” program the “Dumbest Program Ever.”  Given that Chris is familiar with more than a few dumb government programs, that’s quite a statement.

Today, the Washington Post provides more evidence that he might be right:

After the shopping binge inspired by the government’s “Cash for Clunkers” incentive program ended, U.S. auto sales plunged in September and the industry sunk back to the depths from which it started, figures released Thursday showed… The results raised doubts from some economists about the effectiveness of the $3 billion federal program as a stimulus.

Alan Blinder, a Princeton professor who was among the first to push an auto sales incentive program in the United States, doubted it provided much stimulus, in large part because it was in effect for only a month. “Most of the idea of any stimulus is to pull spending up from the future, but it doesn’t make any sense to design a program that only pulls up spending by one month,” said Blinder, a member of the Council of Economic Advisers during the Clinton administration. “Why in the world would you make it a one-month program? The Germans didn’t do that. The British do that. When I designed a mock version of this I was thinking of it as a one-year or two-year program.“

So, Professor Blinder, what happens to auto sales after your one- or two-year program disappears? Regardless of whether the programs lasts one month, three months, one year, or three years, when the “free” money from Uncle Sam goes away, the result is going to be the same.

Milton Friedman said “Nothing is so permanent as a temporary government program.”  Let’s hope he’s wrong in the case of Cash for Clunkers.

Tad DeHaven • October 2, 2009 @ 4:15 pm
Filed under: Tax and Budget Policy

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