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Liberals distort the economy

October 17, 2006 | By Nathaniel Ward

Click to watch Dan Mitchell explain the tax cuts on CNBC.

Click to watch Dan Mitchell explain the tax cuts on CNBC (Windows Media format)

Big government liberals are at it again: arguing once more that the economy is in dire straits as they seek to convince the public to adopt their radical statist agenda. “To these critics,” Heritage economist James Sherk writes, “America has all but returned to a new era of corporate Robber Barons, with entrenched inequality and opportunity only for a fortunate few.”

These, of course, are just liberal misrepresentations. MyHeritage.org has put together a comprehensive Myth Buster to debunk these distortions.

On a related note, Heritage economist Dan Mitchell was on CNBC today to explain that “there’s no question that lower tax rates help an economy grow faster. Why? Because you’re reducing the penalty on productive behavior.”

Explaining North Korea

Heritage experts have been busy this past week talking to the media about North Korea’s recent nuclear tests. Here are just a few of their recent television appearances (note that you’ll need Windows Media Player to view the clips):

What do you think about North Korea’s belligerence? Should Kim Jong Il have nuclear weapons? Take our poll!

Competition and health care

Health care costs are up around the country, and it’s a growing burden for many families. But there’s one group of Americans that’s sitting pretty when it comes to health care, with minimal price hikes and plenty of available benefits: federal employees. As Heritage health care expert Bob Moffit explains, the “Feds get high quality care at competitive prices. No wonder they’re highly satisfied.”

Choice and competition, Moffit argues, work to lower health costs and increase the quality of care. The Federal Employee Health Benefits Program and even the otherwise costly Medicare drug benefit have both kept costs down by offering consumers choice.

Unfortunately, he says, most Americans lack choice and have to use their employers’ single health insurance offering. “True, you could buy a different plan on your own. But there’s the rub. Unlike the plan you get through your employer, you must pay for it with after-tax dollars.” Some in Congress have the right idea, though, and are working to end the federal tax penalties on health care choice, and states like Massachusetts have devised mechanisms to accomplish the same thing.

The wrong spending priorities

“In 2007, Congress will debate reauthorization of the farm bill,” Heritage’s Andrew Grossman writes, “and agriculture often brings out the worst in legislators, turning self-proclaimed free traders into protectionists.” Grossman points readers to a web page set up by The Washington Post that highlights some of the tremendous waste in the federal farm program. Here are some of the outrageous but true headlines on that page:

This is out of hand, but there’s even more to the story.

Heritage budget analyst Brian Riedl looks at farm subsidies and notices a troubling trend: “After averaging less than $14 billion during the 1990s, annual farm subsidies have topped $25 billion in the current decade, following the passage of the most expensive farm bill in American history in 2002.”

Despite these increases, lawmakers and their allies in big agriculture keep coming back for more. Riedl explains that “even as net farm income in 2005 topped $72 billion for only the second time ever, Senators Byron Dorgan (D-ND) and Conrad Burns (R-MT) secured an amendment to the Senate agriculture appropriations bill providing over $4 billion in nationwide agriculture disaster assistance.”

If Congress wants to get serious about eliminating wasteful spending, agriculture subsidies would be a great place to start.

In other news

  • Lynn Stewart, a leftist lawyer, was sentenced yesterday to 28 months in prison for aiding and abetting her terrorist clients. Stewart smuggled messages from her client, the mastermind of the 1993 World Trade Center bombing, to his terrorist comrades.
  • North Korea may be planning a second nuclear test, US authorities reported yesterday. Officials also confirmed that last week’s explosion did involve nuclear material, though they expect that first test might have been a partial failure. The United Nations imposed sanctions on North Korea over the weekend in response to its tests.
  • The New York Times reports that even as demand for energy surges, supply is not rising to meet it, in part because getting permits to build new power plants and transmission lines is so hard.
  • Blogger Ed Morrisey tells us the story of a Navy Seal serving in Iraq who sacrificed himself to save his comrades during a battle with terrorists—by falling on a grenade. “We should make sure that the rest of the country understands the kind of Americans we have on the front lines,” Morrisey writes, “brave, selfless people who want to make the world a better place.”

Coming up at Heritage

To attend these or any other Heritage Foundation events, RSVP at Heritage’s events website. Or you can watch these events live online at Heritage.org. All times are Eastern.

Nathaniel Ward is the Editor of MyHeritage.org—a website for members and supporters of The Heritage Foundation.