Author: Heritage

On 03.10.10 02:46 PM posted by Diane Mannina

<ahref="http://blog.heritage.org/wp-content/uploads/prison-cell-100310.jpg"></p>The recidivism rate among ex-offenders in the U.S. is massive—<ahref="http://bjs.ojp.usdoj.gov/content/pub/press/rpr94pr.cfm">upwards of 67 percent. Helping former inmates find and keep a steady job is crucial to bringing this number down.

That’s what makes an article that ran in the Washington Post this past weekend so interesting. Michelle Singletary is a Personal Finance Columnist who runs the <ahref="http://www.washingtonpost.com/wp-dyn/content/article/2010/03/05/AR2010030501843_pf.html">“Color of Money Challenge.” In past years, Singletary has used her writing and personal finance skills to both work with and share the story of unemployed individuals and struggling military families, but this year she is choosing to take up the challenge of working with two ex-offenders, Stephanie Harris and Christine Foote.

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In her article, Singletary discusses the many partnerships engaged in transforming these two lives. From the Prosperity Partners Financial Freedom Program at First Baptist Church of Glenarden to the Maryland Volunteer Lawyers Service—various organizations are joining together to teach and bring about lasting change. It takes a range of institutions to cultivate individual and community flourishing.

As Singletary states:

I have no doubt this year’s challenge will be tough. As a five-time convicted felon, Harris will have to trade her lucrative drug-hustling skills for a low-wage street-cleaning job.

In order for Harris to stay out of jail, a kind of change will need to take place that rarely happens outside of relationship. This change of character requires a robust civil society in which individuals working through churches, ministries, community groups and friendship help teach values like integrity, self worth, and personal responsibility.

As workforce development specialist Rhonda Gaines states:

[These two ex-offenders] will have great appreciation for being a part of society, and being truly self-sufficient…[e]specially if they learn from you what to do with the money once they have earned it.

Singletary’s story is just one example of many innovative partnerships taking place today among faith-based and community groups. You can explore more of this good work by watching the Heritage Foundation’s new video lesson: <ahref="http://www.seeksocialjustice.com/index.php/restoring-dignity-and-purpose-the-importance-of-work/">Restoring Dignity and Purpose: The Importance of Work. In it you’ll find more examples of civil society institutions doing the hard work of transformation in the life of ex-offenders—work that government simply cannot do.

For more information on effective solutions for human need, visit <ahref="http://www.restoringsocialjustice.com">http://www.restoringsocialjustice.com.

http://blog.heritage.org/2010/03/10/…soner-reentry/

On 03.10.10 07:03 AM posted by Conn Carroll

President Barack Obama is touring the country asking for an up-or-down vote on his health care plan. Forget for a second that Speaker Nancy Pelosi (D-CA) can schedule an up-or-down vote on the Senate health care bill any time she wants, and keep in mind that while Democrats are trying to create the legislative text for President Obama’s “new” health care proposal, <ahref="http://www.politico.com/livepulse/0310/Dems_discuss_pairing_health_with_loan_reform.html" >Senate Democrats are also pushing to include student lending provisions in the reconciliation bill. What does student lending have to do with health care you might ask? Nothing. But the Senate routinely attaches seemingly unrelated matters to must-pass legislation.

That is what makes Majority Leader Harry Reid’s (D-NV) refusal to honor Sen. Joe Lieberman’s (I-CT) request to offer an amendment funding the D.C. Opportunity Scholarship Program (DCOSP) to the American Workers, State and Business Relief Act so transparently hypocritical. Lieberman has been fighting for months to get an up-or-down vote on the DCOSP and saw a good opportunity with the Business Relief Act. But Reid prevented an up-or-down vote by ruling Lieberman’s amendment “not germane” to the underlying legislation. When has that ever stopped the Senate before?

The reality is that the Obama administration and Senate Democrats want to avoid an up-or-down vote on the DCOSP at all costs. Such a vote would force them to choose between their lofty post-partisan education rhetoric and the cold hard reality of the fact that liberal Democrats are beholden to the interests of the teachers unions. Articulating the official position of the Obama administration, Secretary of Education Arne Duncan wrote in <ahref="http://online.wsj.com/article/SB124035679795740971.html">The Wall Street Journal last year: “We must close the achievement gap by pursuing what works best for kids, regardless of ideology. In the path to a better education system, that’s the only test that really matters.” What works. Regardless of ideology. That’s the only test.<spanid="more-28430"></span>

Well the tests are in and the evidence is that the DCOSP works. Specifically, the Obama administration’s own Department of Education released a <ahref="http://ies.ed.gov/ncee/pubs/20094050/pdf/20094050.pdf">report showing “those offered a scholarship were performing at statistically higher levels in reading—equivalent to 3.1 months of additional learning.” Like previous evaluations, it also found that “the [Opportunity Scholarship Program] had a positive impact overall on parents’ reports of school satisfaction and safety…”

But the DCOSP works by giving parents education vouchers so that they are then empowered to make their own decisions about which schools are best for their children instead of being subject to the government-union-controlled education monopoly. That is why the Democrats and their like-minded teachers unions want to kill the program despite the fact that it helps poor kids. <ahref="http://www.washingtonpost.com/wp-dyn/content/article/2010/03/09/AR2010030903336.html">The Washington Post editorializes today:

Unless Congress acts soon or the D.C. government decides to assume responsibility, the voucher program, which has benefited so many students since its inception in 2004, is in grave danger. The Obama administration closed the program to new students; children currently enrolled, while supposedly assured of getting vouchers until they graduate from high school, face uncertainty as the program’s administrator pulls out. This is exactly what the program’s chief antagonists, the teachers unions, want; the National Education Association lobbied fiercely against Mr. Lieberman’s amendment. Given that a rigorous, federally mandated study confirmed the program’s effectiveness and that local leaders such as D.C. Schools Chancellor Michelle A. Rhee have supported it, we understand why Mr. Reid sits on his hands. What possible explanation could Democrats devise for killing something that has been so crucial in the lives of thousands of poor D.C. children? How would it look? No, better to do nothing and hope the issue goes away.

President Obama and his administration are very familiar with the empowering benefits school choice brings to families struggling to educate their children. <ahref="http://www.usnews.com/articles/news/obama/2009/01/07/10-things-you-didnt-know-about-arne-duncan.html">Growing up in Chicago, Obama’s Secretary of Education Arne Duncan attended <ahref="http://www.ucls.uchicago.edu/">a private school. <ahref="http://www.washingtonpost.com/wp-dyn/content/article/2009/01/02/AR2009010202325.html">Growing up in Hawaii, President Obama attended <ahref="http://www.punahou.edu/page.cfm?p=11">a private school. Growing up <ahref="http://campaignstops.blogs.nytimes.com/2008/09/09/the-rantings-of-a-pta-mom/">first in Chicago, and <ahref="http://www.google.com/hostednews/afp/article/ALeqM5g7MVgFxvtwtkAoROPeyRVTPz_nWA">now in Washington, Obama’s two daughters <ahref="http://www.ucls.uchicago.edu/">attended and still attend private schools. In fact, two of Obama’s daughter’s classmates are able to attend Sidwell Friends thanks to the D.C. Opportunity Scholarship Program. And the <ahref="http://www.heritage.org/Research/Education/bg2257.cfm">annual Heritage Foundation survey of Congress and school choice shows that 38% of Members of the 111th Congress sent a child to private school at one time. Congress owes D.C. school children an up-or-down vote on their future.

Quick Hits:

• According to the latest <ahref="http://www.rasmussenreports.com/public_content/politics/current_events/healthcare/march_2010/57_predict_health_care_plan_will_hurt_the_economy" >Rasmussen Reports poll, 66% of voters believe Obamacare is likely to increase the federal deficit and 81% believe it is at least somewhat likely that Obamacare will cost more than official estimates.
• <ahref="http://twitter.com/PoliticsNation/status/10236908557">Not a single Democrat has switched from “no” to “yes” since President Obama began his “final” campaign for health reform.
• White House Press Secretary Robert Gibbs yesterday <ahref="http://twitter.com/mikememoli/status/10235012477">refused to answer whether President Obama would sign the Senate health bill if no reconciliation bill is produced by the Senate.
• According to the state’s independent Legislative Analyst’s Office, <ahref="http://uk.news.yahoo.com/22/20100309/tpl-environment-us-climate-california-20b2d2f.html">California will lose jobs due to higher energy costs from its aggressive climate change policy.
• According to documents uncovered by a former U.N. weapons inspector, Iraqi President Saddam Hussein weighed the purchase of a $150 million <ahref=" http://www.washingtonpost.com/wp-dyn/content/article/2010/03/09/AR2010030903775.html">nuclear “package” deal in 1990.

http://blog.heritage.org/2010/03/10/…ally-deserves/

On 03.10.10 07:33 AM posted by John Ligon

<ahref="http://blog.heritage.org/wp-content/uploads/wm2247_chart1.gif"></p>While legislators finalize yet <ahref="http://online.wsj.com/article/SB10001424052748704751304575079260144504040.html"> another round of stimulus spending, they should self-impose a time-out to assess the <ahref="http://www.heritage.org/Research/Economy/wm2755.cfm">ineffectiveness of the last two years of <ahref="http://online.wsj.com/article/SB10001424052748704751304575079260144504040.html"> government-directed stimulus. After two years of repeated government stimulus programs, the economy remains either in recession or in very slow recovery and yet the federal government continues to tinker with new ‘stimulus’ programs financed with bloated deficit spending.

<ahref="http://www.nber.org/tmp/23069-w15421.pdf">Recent NBER research focusing on the 2008 tax rebate stimulus reveals that there was only a modest per dollar stimulus effect. Indeed, households that found themselves short of money did not go out and spend their rebate checks as many in Congress thought they would. In technical terms, these households showed a very low marginal propensity to consume -– an MPC roughly equal to 0.3. Low-income and low-wealth households did not report spending more as a result of the rebate, and <ahref="http://www.nber.org/tmp/23069-w15421.pdf">households with expected income growth are substantially more likely to spend the rebate than those with expected income declines.

<spanid="more-28447"></span>These findings also suggest that about one-fifth of households receiving the stimulus rebates actually decided to increase their spending and that the rebates “did not stave off the sharp drop in economic activity in 2008 [although] they affect the timing of its onset by making growth in household spending noticeably stronger in the second quarter and noticeably weaker in the fourth quarter than it would have been absent the rebate.” Most importantly boosting income relating to the tax rebates will remain ineffective because it does nothing to change the <ahref="http://www.heritage.org/Research/Economy/wm2247.cfm">marginal incentive to work and also create any permanent change to individuals’ real wealth.

Moreover, the Obama fiscal stimulus package – which has largely shifted the focus of the government-directed dollars to shore up public sector employment, state Medicaid budgets, spending on ‘shovel-ready’ construction projects, etc – is more of the same bad reality: another hugely expensive mistake. Despite the repeated rhetoric that the most recent round of stimulus measures has ‘created or saved between 1.5 and 2 million jobs’, employment statistics reveal that since January of 2009 there has been a <ahref="http://www.heritage.org/Research/Economy/wm2755.cfm">net loss of 3.5 million US jobs. Additionally, over a 5-year period (2009 to 2013), Robert Barro of Harvard University asserts that <ahref="http://online.wsj.com/article/SB10001424052748704751304575079260144504040.html"> “the fiscal stimulus package is a way to get an extra $600 billion of public spending at the cost of $900 billion in private expenditure.”

It is becoming a broken record, yet it is high time that federal policy makers scrap the ineffective (and grossly expensive) model of economic growth which relies on government-directed income and consumption stimulus. Instead, in a real attempt to bolster business confidence and give business a chance to grab a breath of air, Members of Congress should seriously turn to <ahref="http://www.heritage.org/Research/Economy/wm2808.cfm?renderforprint=1">no-cost stimulus legislation that will actually promote investment and entrepreneurship – and hence productive and sustainable economic growth.

http://blog.heritage.org/2010/03/10/…om-washington/

On 03.10.10 08:00 AM posted by James Phillips

<ahref="http://blog.heritage.org/wp-content/uploads/bani-sader100309.jpg"></p>The first president of Iran after its 1979 revolution, Abol Hassan Bani-Sadr, has added his voice to the growing chorus calling for <ahref="http://www.worldsecuritynetwork.com/showArticle3.cfm?article_id=18215&topicID=44">regi me change in Iran.* Bani-Sadr said in an interview that “We would also like the regime to be replaced by a democratic system. However, the position of the west with regards to the current regime is not clear.”* He complained that “From my perspective the west needs to be unambiguous about its wants and wishes so that the Iranian people are reassured that it is not looking for an Iranian regime dominated by foreign powers.”

This is not the first time Bani-Sadr, who long has been in exile in France, has expressed hope for the fall of Iran’s thuggish regime.* Last summer he <ahref="http://www.nytimes.com/2009/08/01/opinion/01iht-edbanisadr.html">wrote an op-ed in the New York Times comparing the popular revolt against the regime to the 1979 revolution.<spanid="more-28445"></span>

But Bani-Sadr’s plea for a clear and unambiguous message from the United States has fallen on deaf ears.* The Obama Administration remains open to a nuclear deal with the regime. *And it continues to look for other forms of “engagement.” Monday, a prominent U.S. official <ahref="http://www.reuters.com/article/idUSTRE6274NO20100308">indicated that he is happy to work with Iran’s ruthless regime on drug-smuggling issues. U.S. envoy Glyn Davies said that he had met with Iranian diplomat Ali Asghar Soltanieh, who not only represents Iran on nuclear matters but is the current chairman of the U.N. Commission on Narcotic Drugs.* Davies said, “We are very happy to work with the chair even if he is from a country which we have differences with.”

Never mind that Iran’s surrogate in Lebanon, the Hezbollah terrorist group, has been involved in smuggling drugs <ahref="http://www.mfa.gov.il/MFA/MFAArchive/2000_2009/2003/1/Iranian%20activities%20in%20support%20of%20the%20P alestinian%20i">into Israel and into*<ahref="http://www.washingtontimes.com/news/2009/mar/27/hezbollah-uses-mexican-drug-routes-into-us/print/">the United States through Mexico.* No wonder that Bani-Sadr has difficulty in understanding U.S. policy regarding Iran.

http://blog.heritage.org/2010/03/10/…regime-change/

On 03.10.10 08:33 AM posted by Brian Darling

<ahref="http://blog.heritage.org/wp-content/uploads/2pelosi_0902121.jpg"></p>The <atitle="http://blog.heritage.org/2010/02/19/health-care-nuclear-option-%E2%80%93-liberals-ready-to-launch/" href="../2010/02/19/health-care-nuclear-option-%E2%80%93-liberals-ready-to-launch/">Health Care Nuclear Option is still the stated plan to get Obamacare to the President’s desk. The latest wrinkle is designed to allow pro-life Democrats to vote for the Senate’s taxpayer funded abortion language while still claiming they never voted for taxpayer funded abortions.* Don’t be fooled.

First, let’s be clear that the Senate bill allows tax dollars to be used for abortions.* According to <atitle="http://www.heritage.org/Research/HealthCare/wm2823.cfm" href="http://www.heritage.org/Research/HealthCare/wm2823.cfm">Chuck Donovan of The Heritage Foundation, the Senate passed Obamacare bill funds abortion in several ways, even creating an appropriation for Community Health Centers that contains no restriction on abortion subsidies.* If the Senate version of Obamacare is passed by the House and sent to the President, then the House has consented to the federal funding of abortion.<spanid="more-28461"></span>

House members have come up with a unique way to structure a vote that attempts to avoid the House voting on legislation before it goes to the president.* First, the House Budget Committee will report out a reconciliation bill.* It is unclear as to whether the Stupak Amendment will be added.* This reconciliation measure would be reported for consideration by the House of Representatives as a whole.

Speaker Nancy Pelosi (D-CA) would then package the Senate passed Obamacare bill and the House reconciliation measure into one measure.* The House rules committee will report out a rule that will allow the Senate passed Obamacare bill to pass the House without a vote.* The rule will be self-executing in the sense that the House will have been deemed to pass the Senate Obamacare bill if the House can muster the votes to pass the reconciliation measure.* The House has used this* procedure in the past during a debate on funding the Global War on Terror and in passing debt limit increases under the “Gephardt Rule.”

There is a constitutional issue raised by this procedure.* Article 1, Section 7, of the Constitution states in part “Every Bill which shall have passed the House of Representatives and the Senate, shall, before it becomes a law, be presented to the President of the United States.”* If the House does not vote on a bill, is it considered to “have passed the House of Representatives?”* Don’t expect the Supreme Court to take up this case, because this is in the realm of a political issue that the Courts tend to want resolved by the House and Senate through the democratic process.* It is a Constitutional concern and should be discussed by all Americans.* If any member of Congress claims to have not voted for the pro-abortion Senate passed bill, one can point to this provision in the Constitution to argue the opposite.

Procedurally, this would happen in the following order.* The House Rules Committee would approve this self-executing rule.* The House would vote on the rule that allows this scenario.* Then the House will vote on the reconciliation measure.* Upon passage of the reconciliation measure the Senate Obamacare bill will be deemed to have passed the House and the reconciliation measure will be sent to the Senate.* This so called “Deeming Resolution” is a trick that allows the House to pass a bill they never voted upon.* Therefore, the real vote on the pro-abortion Senate passed bill will be the vote on the rule to allow this scenario to roll out on the House floor.

One provision that may make the rule is a provision that does not allow the House to report the Senate passed Obamacare bill to the President until the Senate passes a reconciliation bill.* Bills are enrolled before being sent to the President for his signature and the House can prevent the enrollment and delivery of Obamacare to the President until the Senate completes work on the reconciliation measure.* Sound complicated?* Yes and it is supposed to so the American people can’t understand that the House is on the verge of passing an unpopular Obamacare bill, yet they are reserving the right to claim that they did not vote for the Senate passed bill.

If the liberals in the House can pull off this trick, this would have allowed Senate Majority Leader Harry Reid (D-NV) to have secretly written the version of Obamacare going to the President’s desk.* Do you remember <atitle="http://blog.heritage.org/2009/10/14/harry-reid-and-the-chamber-of-secrets/" href="../2009/10/14/harry-reid-and-the-chamber-of-secrets/">Harry Reid and the Chamber of Secrets?* Reid merged, without any official proceedings, the Senate HELP and Senate Finance Committee versions of Obamacare, with his personal additions to the bill including a Public Option with an opt out for states, in closed door meetings with political elites.* Basically, White House Chief of Staff Rahm Emanuel, HHS Secretary Kathleen Sebelius, OMB Director Peter Orszag, Senators Harry Reid (D-NV), Max Baucus (D-MT), Chris Dodd (D-CT) and a few other liberal Senators have rewritten health care law in secret closed door meetings.

After those meeting the Senate moved to proceed to this bill, without any hearings or opportunity for public review.* During debate in the Senate, Senator Harry Reid crafted a manager’s package of amendments and added the Cornhusker Kickback for Nebraska, a Louisiana Purchase and a Gator-Aid earmark.* Now the House is preparing to pass this bill without a vote.* The American people should demand that Congress start over.* This secretive and non-transparent procedure is not way to force through Obamacare.

http://blog.heritage.org/2010/03/10/…erican-people/

On 03.10.10 09:00 AM posted by James Capretta

<ahref="http://blog.heritage.org/wp-content/uploads/money_stacks0902113.jpg"></p>Last Friday, the Congressional Budget Office (CBO) released <ahref="http://www.cbo.gov/ftpdocs/112xx/doc11231/03-05-apb.pdf">its analysis of the president’s 2011 budget submission to Congress. This report hasn’t gotten nearly the attention it deserves.

When the administration released its budget in early February, the news seemed bad enough. By its own reckoning, the Obama administration’s budget plan would result in massive deficits and borrowing if adopted in full. <ahref="http://www.whitehouse.gov/omb/budget/fy2011/assets/tables.pdf">According to the administration’s estimates, the president’s budget plan would produce deficits totaling $10.1 trillion over the period 2010 to 2020, and by 2020 federal debt would reach $18.6 trillion.

But now we learn that that was the rosy scenario.

According to CBO, the Obama budget plan would run up much larger budget deficits and pile up even more debt than the administration reported in February.

Over the period 2010 to 2020, CBO expects the Obama budget would run a cumulative deficit of $11.3 trillion — $1.2 trillion more than the administration predicted. By 2020, total federal debt would reach an astonishing $20.3 trillion — up from $5.8 trillion at the end of 2008.<spanid="more-28469"></span>

The president likes to say he inherited a mess. He did in fact enter office during a deep recession that sent deficits soaring on a temporary basis. But his policies have unquestionably made an already difficult medium- and long-term budget outlook much, much worse. The problem is that President Obama is a world-class spender. He wants to pile massive new commitments on top of a bloated and unreformed government. He is willing to raise taxes to pay for some of his wish list, but far from all of it. For the rest, he plans to run up the nation’s debt with reckless abandon.

CBO’s numbers tell the story.

Over the next ten years, CBO says the Obama budget would increase federal spending by $2.3 trillion, including $0.8 trillion in net interest costs on the additional borrowing that would be required.

Bad as that is, it’s a lowball estimate. The president’s budget assumes that war-fighting funds will plummet from $130 billion in 2010 to just $50 billion in 2012 and every year thereafter. No one believes this will happen. More realistic assumptions would add $500 billion or more to the president’s defense funding request over a ten-year period.

The biggest problem in the federal budget is runaway entitlement spending. And so what would the Obama budget do? Increase entitlement spending, of course. By $1.9 trillion over ten years, according to CBO. In 2020, federal entitlement spending would reach $3.3 trillion, up from $2.1 trillion in 2009.

The administration has been touting a supposed three-year spending “freeze” as evidence of its determination to cut the budget back. But only a very small portion of the budget would be frozen, and only after the administration had spent two years stuffing in more funding. CBO expects that discretionary spending under the Obama budget, excluding war funds and Pell Grants (which would become an entitlement), will increase by $0.5 trillion over ten years.

Two years ago, <ahref="http://www.cbo.gov/ftpdocs/89xx/doc8917/01-23-2008_BudgetOutlook.pdf">CBO expected total federal spending to reach $4.3 trillion in 2018. Now, if the president’s budget plan were adopted, CBO projects spending would exceed $5.0 trillion in 2018.

Between 2010 and 2030, the population age 65 and older <ahref="http://www.ssa.gov/OACT/TR/2009/V_demographic.html#205410">is expected to rise from 41 million to 71 million people. CBO projects spending on Social Security, Medicare, and Medicaid in 2030 will reach 14.4 percent of GDP, up from 9.8 percent today. That will be like adding a whole new Social Security program to the budget without any additional revenue to pay for it.

The federal government is drowning in unaffordable entitlement commitments. President Obama’s response is to spend, entitle, and borrow even more, while he can. And then, with an even bigger government locked into the “baseline,” he plans to pivot and use the prospect of a debt crisis he made much more probable to push for a massive tax increase.

Unfortunately for the president, the public is already onto this game. And they want no part of it.

<ahref="http://corner.nationalreview.com/post/?q=Mjc5ZTIxMjlkYTg1Y2VmNzA0ZjQwMmM5YTQyNDJjMTY=">C ross-posted at <ahref="http://corner.nationalreview.com/">The Corner.

http://blog.heritage.org/2010/03/10/…ntitle-borrow/

On 03.09.10 10:26 AM posted by Dean Cheng

<ahref="http://blog.heritage.org/wp-content/uploads/China-Military-1001131.jpg"></p>The PRC announced this past week that the People’s Liberation Army (PLA) budget would increase by about 7.5% in 2010. This marks the first time that the PLA budget has had an increase of less than 10% in nearly a decade. But don’t jump the gun. It is far from clear that it represents anything with implications for China’s long-term challenge to US predominance in the Asia Pacific.

Chinese defense spending figures are notoriously unreliable, important more for the political signals they send than actual spending. The scale of the announcement, roughly halving the rate of increase for this year’s defense budget compared with last year, is perhaps no more than a signal the Chinese government will be spending noticeably less on specific defense-related projects than it has in previous years.<spanid="more-28397"></span>

Consistent with this possibility are two other recent announcements. One is that the launch of the Tiangong-1 (Heavenly Palace) spacelab would be delayed from 2010 to 2011. While this might be due to technical difficulties, it might also reflect a scarcity in resources sufficient to impinge upon the high visibility (and high prestige) manned space program. Furthermore, the PRC also announced the passage of a national defense mobilization law. This much delayed piece of legislation, several years in the making, will allow the PLA to legally draw upon the resources of the larger civilian economy in event of crisis. In combination, these various developments could suggest that the PLA is being asked to make trade offs, including curtailment of highly visible programs, and be prepared to draw more upon the civilian economy.

Certainly, worth noting, but hardly a sea change. If China’s defense spending growth is slowing, it’s still increasing.

The implications are uncertain; so is the motivation. On the one hand, it may be a domestic political move. There is apparent concern about the need to increase social spending to bridge the growing gap between rich and poor—and defense spending may be where it comes from. Alternatively, it may be that the Chinese economy has slowed so appreciably, it requires belt-tightening even in the Ministry of Defense.

Whatever the Chinese tea leaves may say, it is important to keep in mind that a reduced rate of growth for one year does not equate with cut-backs. It remains to be seen whether the PLA will actually turn inward in the coming year, or whether it will continue to expand its areas of operations and improve its array of equipment.

http://blog.heritage.org/2010/03/09/…dget-slowdown/

On 03.09.10 11:13 AM posted by Anthony B. Kim

<ahref="http://blog.heritage.org/wp-content/uploads/Brazil-cotton-trade-100309.jpg"></p>In a retaliatory response to the U.S. government’s unwillingness to eliminate domestic cotton subsidies, Brazil has announced higher tariffs on over 100 American goods ranging from cars to ketchup.

Trade issues are central to the bilateral relationship between Brazil and the*United States. Brazil is an attractive export destination for U.S. manufacturing, parts and capital equipment sectors. The United States*has been the largest source of Brazil’s imports in these sectors, with the U.S. producers responsible for about a 15 percent share. The already thriving Brazilian market for U.S. exports has great potential to be even stronger, and could provide a blueprint for future U.S. trade with the region and the world. Indeed, the Brazilian market, with consumer spending growing rapidly, should be a poster child for President Obama’s <ahref="http://www.heritage.org/Research/tradeandeconomicfreedom/wm2802.cfm">National Export Initiative, a plan unveiled in the 2010 State of the Union address that promised to double U.S. exports over the next five years and support 2 million new American jobs.

<spanid="more-28411"></span>However, the trade-distorting U.S. cotton subsidy programs, which violate the WTO’s Agreement on Subsidies and Countervailing Measures and the Agreement on Agriculture, run great risk of undermining the whole effort.. Retaliatory tariffs against U.S. exports, triggered by the U.S. subsidy programs, will severely hamper America’s competitiveness in Brazil, effectively shutting off markets for many American products that would otherwise be competitive.

Brazil was hoping for a sign from Secretary of State Clinton during her visit last week that the Obama Administration was willing to seriously address the cotton subsidy problem. No such sign was forth-coming, and international hopes for a renewal of the United States’ traditional commitment to trade liberalization were dashed yet again.

As pointed out in Heritage Trade Analyst Daniella Markheim’s recent <ahref="http://www.heritage.org/research/tradeandeconomicfreedom/wm2815.cfm">Web memo:

America’s refusal to comply with adverse WTO rulings erodes U.S. credibility and influence in the debate shaping globalization and undermines the multilateral trading system. America can afford neither trade retaliation nor the loss of its leadership position in international economic issues, and the WTO is already weakened by nations’ inability to conclude Doha Round trade negotiations. The U.S. should not only change its cotton program this year, but it should also take a hard look at other needed reforms if its national export initiative is to be part of a legitimate trade policy.

If we’re seeing the beginnings of a trade war between the United States*and Brazil, and the United States*fired the first shot.

http://blog.heritage.org/2010/03/09/…rt-initiative/

On 03.09.10 12:00 PM posted by Dean Cheng

<ahref="http://blog.heritage.org/wp-content/uploads/CHINA-PLA-100115.jpg"></p>Admiral Yin Zhuo of the Chinese People’s Liberation Army Navy (PLAN) this week declared that China has an interest in Arctic exploration. Although China has no direct access to the Arctic, this did not dissuade the Admiral, who claimed that no one had sovereignty over the region. Admiral Yin was last heard making the argument that the PRC should establish a permanent base in the Gulf of Aden area, in order to support Chinese anti-piracy operations.<spanid="more-28405"></span>

For many years, Chinese leaders heeded*Deng Xiaoping’s admonition to keep a low profile and not take the diplomatic lead. But several decades of extended economic growth and over a decade of double-digit defense spending increases have resulted in a China that has both global economic interests and substantially more capability to assertively defend those interests. Admiral Yin’s comments are more public examples of this growing trend.

This does not necessarily presage armed conflict amidst the ice floes. Rather, it is the initial salvo in typical Chinese diplomacy, which includes not only far-reaching assertions, but investments in science and technology, as well as claims of international legal support. Thus, the Chinese have allocated funds for building an ice-breaker, which will allow them to conduct Arctic research. At the same time, Admiral Yin references the UN Convention of the Law of the Sea (UNCLOS), <atitle="http://www.chinanews.com.cn/gn/news/2010/03-05/2154039.shtml" href="http://www.chinanews.com.cn/gn/news/2010/03-05/2154039.shtml">stating that under its provisions, the Arctic is the shared heritage of all mankind.

What ought to be of concern is that such steps are integral to Chinese concepts of “legal warfare,” wherein the law is used, not to clarify, but to obfuscate. Idiosyncratic readings of UNCLOS are not limited to the Arctic—the Chinese used similar claims to justify their interference with the USNS Impeccable and Victorious in 2009.

For the United States, it is essential that such Chinese claims and challenges be met resolutely. Such Chinese claims are part of an effort to constrain the United States and other states. Acquiescing to such claims merely opens the way to further limitations, as well as a perception of weakness. The United States, in concert with the other Arctic nations, needs to draw the line on Chinese encroachments, legal and otherwise.

http://blog.heritage.org/2010/03/09/…ce-in-the-sun/

On 03.09.10 01:27 PM posted by Morgan Roach

<ahref="http://blog.heritage.org/wp-content/uploads/Nigeria-sectarian-violence-.jpg"></p>Religious violence in Nigeria is becoming as visible as the government’s inability to control it. On Sunday, ethnic violence ravaged the southern city of Jos. Men armed with machetes wreaked havoc on southern villages in retaliation for the violence that claimed 200 lives in January.

Outbursts of religious violence are not unknown to Nigeria. Riots and violence between Muslims and Christians have claimed over 2,000 lives*between September 2001 and 2008. In July 2009, Boko Haram, members of an Islamic extremist sect, launched multiple attacks in Northern Nigerian states that left 700 dead. And in the past few days, <ahref="http://online.wsj.com/article/SB10001424052748704869304575109962258328770.html?m od=WSJ_hpp_MIDDLETopStories">at least 370 have died, including a four-day old infant,*in the latest round of sectarian violence. The attacks on Sunday are said to be in <ahref="http://www.nytimes.com/2010/03/09/world/africa/09nigeria.html?ref=world">reprisal for the violence last January where dozens of Muslims were killed in and around Jos.

<spanid="more-28415"></span>

The latest round of violence ripples through a Nigeria that is still caught in political limbo, between supporters of the ailing elected president Umaru Musa Yar’adua, who recently returned from Saudi Arabia but remains in seclusion for health reasons, and acting president Goodluck Jonathan. As Nigeria grapples with its political future, including*<ahref="http://www.huffingtonpost.com/amb-john-campbell/nigeria-fragmented-and-un_b_487622.html">rumors of a coup, insecurity increases. So far, Jonathan has <ahref="http://allafrica.com/stories/201003090310.html">sacked his national security advisor, Major-General Sarki Mukhtar, and ordered security agencies to intercept arms and fighters bound for the centers of violence.

Addressing reporters on March 8, Secretary of State Hillary Clinton <ahref="http://www.state.gov/secretary/rm/2010/03/137953.htm">stated that “The Nigerian government should ensure that the perpetrators of acts of violence are brought to justice.”

Yet, justice requires a stable, democratic platform, basic security, and functioning judicial institutions. Those essentials appear increasingly elusive and uncertain in a country where a crisis among the political elites, unease in the military and the middle classes, and rising religious and ethnic tensions threaten the governability and economic stability of this teetering West African giant. What’s more, the instability looms as a major headache for the architects of the Obama Administration’s Africa policy.

http://blog.heritage.org/2010/03/09/…ce-in-nigeria/

On 03.09.10 02:27 PM posted by Dan Holler

</p>Kudos to Sen. Richard Lugar (R-IN) for recognizing that current “rhetoric and legislation [which] are focused primarily at climate change” are out of step with the concerns of most Americans. A January poll by <ahref="http://people-press.org/report/584/policy-priorities-2010">Pew Research Center found “dealing with global warming ranks at the bottom of the public’s list of priorities; just 28% consider this a top priority.” The Senator frames his new <ahref="http://www.lugar.senate.gov/energy/">approach in this way:<spanid="more-28417"></span>

I am proposing practical steps that save money and that everybody can support. Threats to our economy and security are of paramount importance. We can best face these threats by reducing our dangerous dependence on foreign oil and creating U.S. jobs in new energy and conservation efforts.

However rhetorically pleasing that may sound, Americans and policymakers should realize that such a plan would mean more power for the federal government and less choice for Americans. When viewed through that lens, the Senator’s proposal is similar to Obamacare, cap-and-trade and the EPA’s proposed global warming regulations. All three are wildly unpopular with the American people.

Let’s briefly walk through Senator Lugar’s policy outline.

First, he proposes “national building performance standards,” government incentives for retrofitting, and strengthened appliance and lighting efficiency standards. The truth is that government intervention is not needed to achieve these sorts of advancements. They happen naturally as consumers gravitate towards better products and services, which is why, as Heritage’s David Kreutzer <ahref="http://www.heritage.org/Research/Economy/bg2365.cfm">points out, the current “trend toward greater energy efficiency is expected to continue.” Such mandates also come with perverse unintended consequences. Don’t believe me? Think about the CFL light bulbs that <ahref="http://www.heritage.org/Press/Commentary/ed031908b.cfm">contain mercury and how <ahref="http://www.washingtonexaminer.com/opinion/columns/How-GE_s-green-lobbying-is-killing-U_S_-factory-jobs-8162035-55422792.html">the mandate to buy them killed manufacturing jobs in America.

Second, the Senator proposes a “clean energy standard,” <ahref="http://www.heritage.org/Research/EnergyandEnvironment/wm2277.cfm">enhanced loan guarantees and early retirement for some coal plants. As my colleagues Ben Lieberman and Nick Loris <ahref="http://www.heritage.org/Research/EnergyandEnvironment/wm2378.cfm">point out, a clean energy standard “is proposed only because renewables are too expensive to compete otherwise. In effect, Washington is forcing costlier energy options on the public. Since renewables are lavished with substantial tax breaks, a national mandate will cost Americans both as taxpayers and as ratepayers. Any incentive proposed by government should in truth be read as a handout.” Since when did expensive energy mandated by the government and subsidized by the taxpayer become a good idea?

Finally, the highest ranking Republican on the Senate Foreign Relations Committee suggests we reduce our dependence on foreign oil by increasing CAFE standards, continuing the severely flawed ethanol mandate and enhancing “domestic oil production.” The latter is a great idea, which Heritage supports vigorously, but only in the context of free markets, not energy security. Unfortunately, the other measures Lugar identifies are not helpful: 1) the partially enacted <ahref="http://www.heritage.org/Research/tradeandeconomicfreedom/bg2151.cfm">ethanol mandate has already severely distorted markets and 2) <ahref="http://www.heritage.org/Research/EnergyandEnvironment/wm1729.cfm">CAFE standards will force consumers to buy smaller, more expensive vehicles.

Policymakers must realize that empowering the federal government, spending more taxpayer dollars, and taking away consumer choice is not sound energy policy. Its not sound policy, period. Our nation’s energy policy needs change, but those changes should favor consumer choice and free enterprise, not government bureaucrats.

http://blog.heritage.org/2010/03/09/…nsumer-choice/

On 03.09.10 06:33 AM posted by Conn Carroll

Another day, another stream of health care fantasy from the White House. A quick look at two health care events from yesterday, one in Glenside, Pennsylvania, and the other in Tawas City, Michigan, clearly exposes the yawing gap between the Obama administration’s health care rhetoric and cold hard legislative reality. First in Glenside, President Barack Obama <ahref="http://www.nytimes.com/2010/03/09/health/policy/09health.html?ref=todayspaper">turned up the volume on his already tired “final push” for health care reform. In addition to the usual litany of false claims about the legislation in Congress (in fact, <ahref="http://www.heritage.org/Research/HealthCare/wm2774.cfm">you don’t get to keep your doctor, <ahref="http://blog.heritage.org/2010/03/08/health-reform-that-breaks-the-bank/">it isn’t paid for, <ahref="http://www.heritage.org/Research/HealthCare/bg2369.cfm/">it doesn’t reduce costs) President Obama also repeated his new line from his <ahref="http://blog.heritage.org/2010/03/04/morning-bell-obamacares-kabuki-end-game/">doctors-in-lab-coats address last week:

We have now incorporated almost every single serious idea from across the political spectrum about how to contain the rising cost of health care … Our cost-cutting measures mirror most of the proposals in the current Senate bill…

But, as we <ahref="http://blog.heritage.org/2010/03/04/morning-bell-obamacares-kabuki-end-game/">pointed out last week, there is one not-so-minor difference between the Senate bill and the President’s new proposal: the Senate bill actually exists. Now, Democrats may be telling their conservative counterparts that <ahref="http://corner.nationalreview.com/post/?q=YmU1YThmODhmZGExY2NkY2Q5NmU2NmI4MjYzMTExYzA=">t hey will have reconciliation legislative text in front of the Budget Committee by tomorrow, but don’t hold your breath. The “fixes” that the White House is promising wavering House Democrats they will make all sound easy at first glance: 1) scaling back the tax on high-end health insurance policies; 2) closing the Medicare D loophole; 3) boosting insurance subsidies; 4) increasing Medicaid payments; and 5) fixing the Cornhusker Kickback. But when you take a second look, you see that all of these “fixes” will cost more money. Just look at the Cornhusker Kickback which the President chose to address, not by taking away Nebraska’s special Medicaid payments, but by extending those extra Medicaid payments to every state! Every single item in the President’s proposal either increases spending or reduces new revenues. And he didn’t put forward any way to pay for them. If passing health reform were as easy as giving away free candy, Obamacare would be law already. Finding a way to pay for all these fixes is going to be just as difficult as every earlier effort to pay for this bill. So don’t expect any solutions anytime soon.<spanid="more-28362"></span>

And we haven’t even mentioned <ahref="http://blog.heritage.org/2010/03/08/a-piecrust-promise-from-pelosi-and-reid/">“abortion” yet, which brings us to Tawas City where Rep. Bart Stupak (D-MI) hosted his own health care townhall. Now the Associated Press headline may read <ahref="http://www.google.com/hostednews/ap/article/ALeqM5iJ1cJ9n9sI1uAPv_Fa64wjCy2gggD9EAORAG0">“Stup ak: Health bill abortion fight can be resolved” but then the AP actually reports “Rep. Bart Stupak said he expects to resume talks with House leaders this week…” In other words, there is no agreement yet. And what kind of timeline is Stupak looking at for such an agreement? WJRT<ahref="http://abclocal.go.com/wjrt/story?section=news/local&id=7319043"> reports: “[Stupak]’s confident a bill will pass sometime this year.” “Sometime this year” is a bit longer of a timeframe than the White House deadline of next Thursday. But even more importantly, look at the process Stupak suggests for final passage: “According Stupak, until the House and the Senate bills and the president’s proposals become one piece of legislation, health care will remain in limbo.” Considering that everyone agrees that abortion cannot be fixed in reconciliation, Stupak’s position is a total rejection of the White House’s current plan to have the House pass the Senate bill now on the promise that the Senate might come back and try and fix it sometime in the future. Stupak clearly wants “one piece of legislation,” and the only way to accomplish that is to scrap the current Senate bill and start over.

In the meantime, legislative “limbo” has not been kind to the Senate bill. Every day seems to bring news of yet another yes vote switching to undecided or no vote. Just yesterday, former-yes votes <ahref="http://theplumline.whorunsgov.com/terrorism/happy-hour-roundup-175/">Reps. Michael Arcuri (D-NY), Dan Maffei (D-NY), Bill Owens (D-NY) and <ahref="http://www.weeklystandard.com/blogs/illinois-democrat-lipinski-will-switch-yes-no-if-health-bill-lacks-stupak-amendment">Dan Lipinski (D-IL) all confirmed they were either now undecided or would vote no. And Rep. Artur Davis (D-AL), who voted no the first time, said he would <ahref="http://thehill.com/blogs/blog-briefing-room/news/85485-alabama-dem-lawmaker-will-break-from-campaign-trail-to-oppose-health-reform">suspend his campaign for Governor just so he could come back to Washington to vote against Obamacare again. The President can travel the country talking about an up-or-down vote for “our proposal” all he wants, but the reality is he simply doesn’t have the votes in the House for the only piece of health care legislation that actually exists.

Quick Hits:

• With recipients now allowed to collect unemployment benefits for as long as 99 weeks, one may now wonder if this “temporary” relief has turned into a <ahref="http://www.washingtonpost.com/wp-dyn/content/article/2010/03/08/AR2010030804927.html">permanent, expensive entitlement.
• The New York Times <ahref="http://www.nytimes.com/2010/03/09/business/energy-environment/09solar.html?ref=todayspaper">details Spain’s failed experiment with massive solar power subsidies.
• State health insurance experts see <ahref="http://www.nytimes.com/2010/03/09/health/policy/09rates.html">huge flaws in President Obama’s health insurance price control scheme.
• States with large government union pension liabilities are taking <ahref=" http://www.nytimes.com/2010/03/09/business/09pension.html?ref=todayspaper">big investment risks to try and cover their huge pension liabilities.
• According to a new Democracy Corps/GQR/Third Way poll, <ahref="http://www.politico.com/news/stories/0310/34087.html">51% of likely voters disapprove of President Obama’s decisions on interrogation and prosecution of terrorism suspects.

http://blog.heritage.org/2010/03/09/…ation-walking/

On 03.09.10 08:25 AM posted by Conn Carroll

<ahref="http://blog.heritage.org/wp-content/uploads/solar.jpg"></p>The White House’s National Economic Council’s September 2009 report, <ahref="http://www.whitehouse.gov/administration/eop/nec/StrategyforAmericanInnovation/">A Strategy for American Innovation: Driving Towards Sustainable Growth and Quality Jobs, informs us: “A strong economy, but too reliant on precarious, bubble-driven growth, is unsustainable.” And it is true: our government should not try and inflate bubbles in order to spur short-term economic growth. Which is why the White House should read today’s <ahref="http://www.nytimes.com/2010/03/09/business/energy-environment/09solar.html?ref=todayspaper">The New York Times article on the Spanish solar program that President Barack Obama so often <ahref="http://www.clevelandleader.com/node/8587">holds out as a model for our country to follow:<spanid="more-28381"></span>

Two years ago, this gritty mining city hosted a brief 21st-century gold rush. Long famous for coal, Puertollano discovered another energy source it had overlooked: the relentless, scorching sun.

Armed with generous incentives from the Spanish government to jump-start a national solar energy industry, the city set out to replace its failing coal economy by attracting solar companies, with a campaign slogan: “The Sun Moves Us.”
…
But as low-quality, poorly designed solar plants sprang up on Spain’s plateaus, Spanish officials came to realize that they would have to subsidize many of them indefinitely, and that the industry they had created might never produce efficient green energy on its own.

In September the government abruptly changed course, cutting payments and capping solar construction. Puertollano’s brief boom turned bust. Factories and stores shut, thousands of workers lost jobs, foreign companies and banks abandoned contracts that had already been negotiated.

According to a <ahref="http://www.juandemariana.org/pdf/090327-employment-public-aid-renewable.pdf">study from King Juan Carlos University in Madrid, for every “green job” created by Spain’s solar subsidies, 2.2 jobs in other sectors were destroyed and $758,471 was spent to create each green job. Germany is also paying dearly for their solar subsidies. A study commissioned by the Institute for Energy Research (IER),* <ahref="http://www.instituteforenergyresearch.org/germany/Germany_Study_-_FINAL.pdf">found per worker subsidies for solar industry jobs are as high as $240,000.

Spending six figures for temporary “green jobs” is not A Strategy for American Innovation.

http://blog.heritage.org/2010/03/09/…bubble-busted/

On 03.09.10 08:55 AM posted by Conn Carroll

<ahref="http://blog.heritage.org/wp-content/uploads/yogiberra.jpg"></p>President Barack Obama <ahref="http://www.nytimes.com/2010/03/05/health/policy/05health.html">says he will have his health care bill passed by the House before he leaves for Australia on March 18th. Nobody outside the White House believes that is going to happen. Next week’s blown deadline will join a crowded graveyard of past deadline including <ahref="http://www.spokesman.com/stories/2009/jul/14/obama-sets-health-bill-deadline-for-weeks-end/">July, <ahref="http://www.huffingtonpost.com/2009/07/12/lawmakers-wont-make-obama_n_230256.html">August, and <ahref="http://www.politico.com/blogs/politicolive/0809/About_that_deadline.html">September. But blown deadlines are not the only reoccurring storyline from this health care debate. President George Bush economic adviser <ahref="http://keithhennessey.com/2010/03/08/dj-vu-all-over-again/">Keith Hennessey has paired 13 2009 health care* headlines with 13 2010 headlines. See if you can tell which are from this year and which are form last year:<spanid="more-28390"></span>

<ahref="http://www.politico.com/news/stories/0310/34044.html">Politico: President Obama takes reform on the road
<ahref="http://www.guardian.co.uk/world/feedarticle/8631803">AP: Obama takes health care pitch to people—again

<ahref="http://www.bloomberg.com/apps/news?pid=20601070&sid=aTqn2mS8JVDU">Bloomberg: Obama Set to Fight ‘Uphill Battle’ on Health Bill
<ahref="http://www.bloomberg.com/apps/news?pid=20601087&sid=aS4XGGJ.08aQ">Bloomberg: Obama to Appeal to Public on Health Care as Senate Struggles

<ahref="http://news.yahoo.com/s/ap/20100307/ap_on_bi_ge/us_health_care_leap_of_faith_6">AP: Obama’s health care pitch to Democrats: Trust me
<ahref="http://www.cp24.com/servlet/an/local/CTVNews/20091107/091107_healthcare_reform/20091107/?hub=CP24Home">AP: Obama makes last-minute appeal to Democrats for health care votes

<ahref="http://news.yahoo.com/s/ap/20100308/ap_on_bi_ge/us_obama_health_overhaul_2">AP: Obama to appeal for public support on health care
<ahref="http://www.guardian.co.uk/world/feedarticle/8796540">AP: Obama appeals for health care votes

<ahref="http://www.csmonitor.com/USA/Politics/2010/0301/To-pass-healthcare-reform-Democrats-may-go-it-alone">CSM: To pass healthcare reform, Democrats may go it alone
<ahref="http://transcripts.cnn.com/TRANSCRIPTS/0908/19/ltm.03.html">CNN: Democrats May Pass Health Reform without GOP Support

<ahref="http://www.nytimes.com/2010/03/05/health/policy/05health.html?sq=deadline&st=cse&adxnnl=1&scp=1&ad xnnlx=1267896974-XToWsunXAA4bMFc+skiGGw">NYT: Obama Takes Health Care Deadline to Democrats
<ahref="http://www.breitbart.com/article.php?id=CNG.ac6a51e339891c1b6cfed137bd4e90b c.2f1&show_article=1">AFP: Deadline looming, Obama urges health care action

<ahref="http://www.boston.com/news/health/articles/2010/03/04/obama_steps_up_health_care_pressure">Boston Globe: Obama steps up health care pressure
<ahref="http://www.politico.com/news/stories/0709/24897.html">Politico: President Obama steps up health care push

<ahref="http://www.google.com/hostednews/afp/article/ALeqM5jxuivqdboEbyv3DGbuQPZs-pmX0w">AFP: Obama presents make-or-break health reform plan
<ahref="http://www.npr.org/templates/story/story.php?storyId=106865182">NPR: For Obama, Health Care Overhaul Is Make-Or-Break

<ahref="http://www.google.com/hostednews/ap/article/ALeqM5jlMpJGn28kqCcgU-aGcYE_ZHW-ywD9E77TRG0">AP: Top Dems looking to Obama for health care momentum
<ahref="http://www.reuters.com/article/domesticNews/idUSTRE56H12J20090718">Reuters: Obama tries to regain momentum in healthcare debate

<ahref="http://www.reuters.com/article/idUSTRE61I0CS20100219">Reuters: Obama seeks momentum, funds for Senate allies
<ahref="http://www.reuters.com/article/healthNews/idUSTRE55G6GJ20090618">Reuters: Obama team tries to regain momentum on healthcare

<ahref="http://www.cbsnews.com/8301-503544_162-6267670-503544.html">CBS: Obama’s Health Care Push: The Race is On
<ahref="http://voices.washingtonpost.com/health-care-reform/2009/07/obama_health_care_push_resumes.html">WaPo: Obama Health Care Push Resumes This Week

<ahref="http://www.google.com/hostednews/ap/article/ALeqM5gkPFIC1wrQ-L7QiPDPFt0IQLXVygD9E97QJ83">AP: Obama turns up the heat for health care overhaul
<ahref="http://www.kentucky.com/329/story/901798.html">AP: Obama expands health care push

<ahref="http://www.huffingtonpost.com/2010/02/23/white-house-dems-plan-for_n_473964.html">HuffPo: White House, Dems, Plan For Make-Or-Break Summit
<ahref="http://www.bloomberg.com/apps/news?pid=20601103&sid=ajxuZuz_.rSE">Bloomberg: Obama Sets ‘Make-or-Break’ Deadline on Health Care

http://blog.heritage.org/2010/03/09/…ll-over-again/

On 03.08.10 03:00 PM posted by Dani Doane

According to Roll Call, during a Democrat strategy session last week Speaker Nancy Pelosi (D-CA) broached the idea of suspending earmarks during the 2010 appropriations process. And even though the reasons cited were mostly political – this fiscal restraint would come as welcome relief to the average everyday American.

Earmarks have long been considered an emblem of Washington, DC corruption, waste and abuse. Earmark supporters will make such arguments as “the total amount of spending on earmarks is minimal,” or “why should we let bureaucrats spend federal dollars, when we know where the money should go.” But these desperate arguments miss the point. Earmarks are not only a classic sign of favoritism but they grease the wheels for ever higher levels of government spending.

Additionally, there are so many earmarks now (in 2009 there were estimated to be 11,914 for a total of over $20 billion) that abuse is bound to happen. Remember the “Bridge to Nowhere.”

In 2007 a similar effort was undertaken by a Republican majority. In that case the Republican majority refused to fund over 10,000 earmarks that were left over in FY 2007 appropriations bills from the previous year. This ended up being a one shot deal though as the FY 2008 earmark process continued with earmarks unabated. But this is a good idea whose time may have come again. This moratorium should also have backing from the Administration as President Obama has also been an advocate for reducing earmarks. Specifically, the President proposed that:

• The annual cost of earmarks should be no greater than $7.8 billion, the level they were at in 1994, when the Republicans took control of Congress; and
• Any earmark for a for-profit company should be subject to the same competitive bidding requirements as other federal contracts.

To a disgruntled, disillusioned, dispirited American populace a truly effective earmark moratorium would come as welcome relief. But it has to be legitimate and not just window dressing and more of the same. Some ideas to give it teeth include:

• A Practical Working Definition. As my colleague Ron Utt notes earmarks are a bit like pornography – you know it when you see it but it is hard to find a good definition. Earmarks are so widely used and abused that it is hard to get a firm plan for reduction when they can so easily be moved or re-named.
• Active Administration Support. In 2007 Members quickly found a way around the ban by calling and intimidating federal agency personnel into honoring the earmarks. To truly uphold any ban effectively President Obama needs to take a page from his predecessor. When President Bush found out that Members were circumventing the ban through federal agency intimidation he had his OMB Director Rob Portman issue a memorandum to heads of departments and agencies directing them not to honor such informal requests.
• They Should Be Joined by the Senate. A one-sided earmark moratorium will not achieve the goals of reducing any earmarks as House Members would just submit their requests to the Senators giving them more earmark credit to take. Sen. Jim DeMint of South Carolina has already called for the Senate to also take up the moratorium which would give a lot more credibility and effectiveness to this effort.

Earmark reform efforts have always been a tough sell in Congress. Members from both sides of the aisle like to be able to bring home dollars for the State or District. But the fundamental unfairness of earmarks has long stuck in the craw of the American people. Media reports indicate that Speaker Pelosi is considering a one year moratorium on earmarking. This would be a great first step and may be the beginning of bipartisan agreement on an issue that may restrain federal spending.

http://blog.heritage.org/2010/03/08/…ark-free-zone/

On 03.08.10 09:01 AM posted by Ben Lieberman

<ahref="http://blog.heritage.org/wp-content/uploads/earth-100223.jpg"></p>The same ethical advice for doctors also makes sense for Congress as it considers several pending global warming bills – first do no harm. Given serious questions about global warming science as well as the efficacy of costly proposals to address it, the best choice for Washington is none of the above.

With economy-wide cap and trade stalled in the Senate, a number of slightly scaled back variants have been proposed, including measures targeting selected industries or a carbon tax. All threaten to do more harm than good.<spanid="more-28290"></span>

Before considering these measures, Congress should first get to the bottom of Climategate, Glaciergate, Hurricanegate, Amazongate, and other scandals that raise troubling questions about scientific credibility. Virtually every scary claim used to justify precipitous action—unprecedented temperatures, rapidly melting glaciers, increasing hurricanes, plummeting crop yields, disappearing rainforests—is under genuine suspicion. The fact that temperatures have been*<ahref="http://www.dailymail.co.uk/news/article-1250872/Climategate-U-turn-Astonishment-scientist-centre-global-warming-email-row-admits-data-organised.html">statistically flat since 1995 is another reason not to treat global warming as a dire crisis.

Haste in light of these scientific doubts is all the more troublesome given the cost of cracking down on fossil fuels, no matter how imposed. All of the legislative proposals have one thing in common—they reduce carbon dioxide emissions by driving up the cost of energy so that individuals and businesses are forced to use less. Inflicting significant economic pain (<ahref="http://www.heritage.org/Research/Economy/bg2365.cfm">likely trillions of dollars and millions of jobs for cap and trade, somewhat less for watered down measures) is how this all works.

These measures have another thing in common—their uselessness. Even if one still believes the worst case scenarios of global warming, unilateral action against the American people and American economy would hardly dent the upward trajectory of emissions. China alone out emits the U.S. and its emissions growth is projected to be*<ahref="http://www.eia.doe.gov/oiaf/ieo/emissions.html">nine times higher than ours. And it is hard to ignore Chinese government officials’ frequent and unambiguous statements that they will never impose similar restrictions on themselves, though some global warming activists still try.

Washington cracking down on fossil fuels in the name of addressing global warming would result in much economic pain for little if any environmental gain. First do no harm.

<ahref="http://views.washingtonpost.com/climate-change/panelists/ben_lieberman/2010/03/congress_should_do_the_right_thing_-_nothing.html">Cross-posted at*<ahref="http://www.washingtonpost.com/">The Washington Post’s*<ahref="http://views.washingtonpost.com/climate-change/">Planet Panel.

http://blog.heritage.org/2010/03/08/…%80%94nothing/

On 03.08.10 10:12 AM posted by Christine Kim

</p>“No family change has come to the fore in modern times more dramatically, and with such rapidity, as heterosexual cohabitation outside of marriage,” writes <ahref="http://www.virginia.edu/marriageproject/pdfs/NMP2008CohabitationReport.pdf">David Popenoe, Professor Emeritus of Sociology at Rutgers University and one of the preeminent family scholars in the country.

The <ahref="http://www.cdc.gov/nchs/data/series/sr_23/sr23_028.pdf">latest release by the CDC’s National Center for Health Statistics (NCHS) merely confirms Professor Popenoe’s conclusion.* It reports that, in 2002, one in two women aged 15 to 44 has been in a cohabiting relationship, about a 10-percentage-point increase since 1995.* Among women aged 25 and older, more than 60 percent have ever cohabited.<spanid="more-28303"></span>

Over the last few decades, the increase in cohabitation has contributed to <ahref="http://www.americanvalues.org/pdfs/IAV_Marriage_Index_09_25_09.pdf">the collapse of marriage and <ahref="http://www.cdc.gov/nchs/FASTATS/unmarry.htm">the steep rise in out-of-wedlock childbearing.* Between 1970 and 2008, the marriage rate fell by one-half, while the unwed birth rate rose from 11 percent to nearly 40 percent. *Already in 2001, more than one-half of the children born outside of marriage were to cohabiting parents.* Overall, two-fifths of all children will spend a portion of their childhood with an unmarried parent and his or her cohabiting partner.

The erosion of marriage and the upsurge in unwed childbearing can have lasting individual and social consequences.* As the NCHS report notes:

Research findings consistently document associations between formal marital status and well-being.* Married persons have generally better mental and physical health outcomes compared with unmarried persons.* Married persons also live longer, have higher rates of health insurance coverage, and lower prevalence of cardiovascular disease than unmarried person.

Furthermore, the “[r]esearch also indicates that marriage is positively associated with the health and well-being of children.* Children born to unmarried mothers are at greater risk than children born to married mothers for poverty, teen childbearing, poor school achievement, and marital disruption in adulthood.”

Notably, these adverse effects are not distributed equally and may continue intergenerational patterns.* As the NCHS study points out, the experience of cohabitation and marriage differ significantly by individuals’ educational level and their parents’ marital history.

For example:

• Among women who dropped out of high school, only 49 percent are currently married, while 17 percent are in cohabiting relationships, compared to 63 percent and 5 percent, respectively, of college-educated women.
• Married women who lived in intact families at age 14 are 40 percent more likely to reach their tenth year anniversary than peers from non-intact families (67 percent versus 48 percent, respectively).

The report also concludes that cohabitation tends to be short-lived, leading to a complete breakup or marriage.* For women, less than one-third of first cohabiting relationships last more than three years, and less than one-fifth more than five years.

While the majority (65 percent) of first-time cohabitors marry within five years, marriages preceded by cohabitation, particularly without engagement, are more likely to end in divorce within a decade, compared to first-time marriages that do not begin with premarital cohabitation.

Moreover, cohabitation is not the qualitative equivalent of marriage.* As the report notes, “[S]tudies have emerged that suggest that cohabitors do not show the same level of health benefits as married persons….and report lower levels of relationship quality and lower household incomes than married couples.”

Sadly, as Heritage research fellows Katherine Bradley and Robert Rector note, “[d]espite the fact that collapse of marriage is the primary cause child poverty and welfare dependence, <ahref="http://www.heritage.org/Research/Family/wm2819.cfm">the Obama administration plans to eliminate all federal activity designed to strengthen marriage,” including programs that have served to advance and encourage healthy marriages in low-income communities.

http://blog.heritage.org/2010/03/08/…-really-means/

On 03.08.10 10:43 AM posted by Nick Loris

The International Monetary Fund (IMF) is attempting to do what couldn’t be done at the international climate change conference in Copenhagen last December: Transfer large sums of wealth from developed countries to developing ones in the name of climate change. From <ahref="http://www.businessweek.com/news/2010-03-08/strauss-kahn-says-imf-working-on-100-billion-green-fund-.html">BusinessWeek:

Dominique Strauss-Kahn, head of the International Monetary Fund, said the organization is helping to set up a “green fund” that would raise $100 billion a year by 2020 to mitigate the effects of climate change in developing countries.

Strauss-Kahn indicated the fund may use its quotas, which reflect member countries’ financial capacity and obligations within the IMF, to raise initial funding. The IMF would not manage the money raised, he said. Last year, an increase in quotas allowed the institution to boost global liquidity by more than $250 billion at the request of the Group of 20 leaders.”

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There are prudent ways to help developing countries protect against natural disasters but more foreign aid isn’t one of them. Heritage Senior Policy Analyst Ben Lieberman, who witnessed many of the developing countries’ pleas for handouts, <ahref="http://blog.heritage.org/2010/02/18/new-climate-chief-won%e2%80%99t-change-un%e2%80%99s-problems-with-addressing-climate-change/">lists several problems with foreign aid: “In many cases only a fraction of the funds were well spent, and aid can encourage the perpetuation of the very reasons (and regimes) that gave rise to the need for assistance in the first place. Foreign aid doled out to fight global warming has another big drawback – the problem it addresses is an overstated one.”

More economic freedom will allow developing countries to actually develop and build houses and buildings more resistant to natural disasters. Take the recent tragic setbacks in Haiti and Chile, for instance. In the <ahref="http://www.heritage.org/index/">2010 Heritage Index of Economic Freedom, Chile ranks 10th and is categorized as “mostly free.” Haiti ranks in the “mostly unfree” category at 141st. Income per capita is much higher in Chile and its citizens can afford soundly-constructed infrastructure. Although the earthquake that hit Chilean land was stronger than that of Haiti’s, there was far less casualties and structural damage <ahref="http://news.yahoo.com/s/ap/cb_tale_of_two_quakes">because “Chileans, on the other hand, have homes and offices built to ride out quakes, their steel skeletons designed to sway with seismic waves rather than resist them.”

Instead of establishing green funds, we should be working to open up markets to help countries improve both their economy and their environment. “Engaging in freer trade is a fundamental part of a strategy to better promote the evolution of sensible environmental regulations by empowering countries with the economic opportunity to develop and raise living standards,” <ahref="http://www.heritage.org/Research/EnergyandEnvironment/sr0074.cfm">writes Senior Trade Policy Analyst Daniella Markheim.

We do have opportunities to help developing countries become more sustainable and economically prosperous. But they don’t involve the IMF and hundreds of billions of dollars annually in wealth transfers.

http://blog.heritage.org/2010/03/08/…-want-to-play/

On 03.08.10 12:10 PM posted by Aleksey Gladyshev

<ahref="http://blog.heritage.org/wp-content/uploads/empty-pockets.jpg"></p>Raising taxes does not mean more overall revenue, recently seen in <ahref="http://voices.washingtonpost.com/annapolis/2010/02/montgomery_chief_leggett_tries.html#more">Montgome ry County, Maryland, which has had a particularly bad fiscal year after a recent tax hike. The county, which is just across the northern border of the District of Columbia, saw many residents making over $1 million move out when a tax hike was introduced in 2008, and now there are not enough high-income residents in the county to pay their share of taxes. The result of the high tax flight? The county now runs a budget deficit.

The drop in revenue was not entirely due to the recession but rather to unfortunate fiscal policy that drove away the highest earners in the county; Montgomery officials said that after the increase in taxes, <ahref="http://voices.washingtonpost.com/annapolis/2010/02/montgomery_chief_leggett_tries.html#more">the tax revenue dropped 13 percent between 2008 and 2010, while actually rising 40 percent before the tax increases, in 2005 to 2007.

<spanid="more-28325"></span>In the Washington Post’s report, county executive Isiah Leggett sums up the situation nicely in a recent session with council members: “Remember what I said years ago. This is a structural deficit. Structural.” What Mr. Leggett means is that the county government has been growing quickly in recent years, and now, since some high-income individuals have moved out, the county cannot cut spending as quickly as revenue has dwindled.

Let us set aside the similarities between Montgomery County’s tendencies to grow with our federal government’s desire to expand under the Obama Administration; this lesson– that increased taxes do not necessarily lead to higher revenues– should be noted by President Obama. The county’s revenue problem is a specific example of the results of the Laffer curve, which says that government can raise taxes up to a point in order to increase revenue, but after that point total revenue actually starts to decrease with higher tax rates.

What is especially worrying about the difficult choices that must be made by Montgomery County officials to cut costs is that 250 government jobs may be lost in order to close the budget gap. Now is an especially unfortunate time for people to lose jobs, and <ahref="http://www.heritage.org/research/taxes/wm2790.cfm">raising taxes makes job creation harder in both the public and private sectors.

The President has stated previously his plans of a tax hike for American households with high incomes. Although Americans might not be able to move to different states in the event of a tax increase, the ones with the most money will be able to manipulate their taxable income and finances, with the help of crafty lawyers, <ahref="http://www.heritage.org/research/taxes/wm327.cfm">which on a larger scale could very well have an effect similar to what has occurred in Montgomery County. Remember, there were federal revenue shortfalls in the 1950s and 1960s when individual income tax rates exceeded 70 percent. Let us learn from the mistakes in this region so that we may not have to repeat them on a much larger scale.

Aleksey Gladyshev is currently a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: <ahref="http://www.heritage.org/about/departments/ylp.cfm">http://www.heritage.org/about/departments/ylp.cfm

http://blog.heritage.org/2010/03/08/…spell-trouble/

On 03.08.10 01:00 PM posted by Conn Carroll

<ahref="http://blog.heritage.org/wp-content/uploads/doctor_bill0906234.gif"></p>During last month’s Blair House health care summit, President Barack Obama was forced to change the subject after Rep. Paul Ryan(R-WI) Blair House <ahref="http://blog.heritage.org/2010/02/26/video-paul-ryan-destroys-obamacares-deficit-reduction-claims/">thoroughly refuted the President’s claim that his health care plan would reduce the deficit. It took over a week for the White House to respond to Ryan, but last Thursday they finally produced this <ahref="http://www.whitehouse.gov/omb/blog/10/03/04/No-Gimmick/">blog post by OMB director Peter Orszag followed by a Washington Post op-ed Friday titled: <ahref="http://www.washingtonpost.com/wp-dyn/content/article/2010/03/04/AR2010030404041.html?hpid=opinionsbox1">Health reform that won’t break the bank. Ethics and Public Policy Center fellow James Capretta responded to the White House that same day at <ahref="http://healthcare.nationalreview.com/post/?q=MmRmNzg2NDM4MGJiMWIzMTAzMzY1YWQ0Mjc5ZTJkYTc=">N RO:

Orszag and DeParle start by agreeing with Ryan that delaying the start date of an entitlement expansion is a tried-and-true budget gimmick, designed to push the full cost of the additional spending outside of the “budget window” covered by a cost estimate.<spanid="more-28316"></span>

But, not to worry, they say. In this instance, it’s not a gimmick because the deficit reduction from their plan just keeps growing over time. They claim the president’s health plan would produce deficit reduction of $100 billion over ten years and $1 trillion in the second decade.

Of course, there’s another reason besides balancing revenue and spending to push the start of an entitlement back, and that’s to make the ten-year cost look much smaller than it really is. Recall that the president promised in his address to Congress last September to deliver a bill that costs only “$900 billion” over a decade. The new entitlements the Democrats want to create would cost much, much more than $90 billion per year. In fact, the Congressional Budget Office (CBO) says they will cost about $200 billion per year by 2019. And so, to get the media to now say his plan costs only “$1 trillion” (what’s $100 billion among friends!), the administration delays the coverage expansion provisions until 2014. Never mind that the president also says the uninsured can’t wait a day longer for the legislation. Once enacted, he would make them wait — for four years.

As Ryan noted, however, once the program did get up and running, costs would soar. The Senate Budget Committee Republican staff estimates the Senate bill’s cost at $2.3 trillion over ten years when fully implemented.

In their Post op-ed, Orszag and DeParle do not even attempt to address the many other points Ryan made which expose the dubious assumptions and sleight of hand behind their deficit-cutting claims.

For instance, the health-reform bill is filled to the brim with Medicare changes, but the one Medicare provision the president and the Democrats want to pass separately from the health bill is the so-called “doc fix,” which would repeal a cut in Medicare physician fees at a cost of $371 billion over ten years. Of course, splitting their agenda into two or three bills doesn’t change the total cost. When the “doc fix” is properly included in a tally of what the president is pushing, all of the supposed deficit reduction vanishes.

Then there’s the double-counting that Ryan exposed. The president’s plan starts up yet another entitlement program, providing long-term care insurance. Enrollees have to pay premiums for a number of years before they qualify for any benefits. Consequently, at startup, there’s a surplus of premium collections — $73 billion over ten years, according to CBO — because no one qualifies for the benefits yet. The president and his team count these savings against the cost of health reform — even though the money will be needed later to pay out long-term-care insurance claims. When this gimmick is taken out of the accounting, the president’s health proposal goes even deeper into the red.

Over the long-run, the administration’s claim of large-scale deficit reduction hinges on the dubious assumption that future elected officials will demonstrate more political courage than those in office today.

For most of last year, the president said that he would “bend the cost-curve” in large part by imposing a new tax on “high-cost” insurance plans. The tax would hit more and more middle-class beneficiaries each year because the threshold for determining what constitutes a “high-cost” plan would grow much more slowly than medical costs. In fact, after a number of years, virtually all Americans would be in plans at or above the “high-cost” threshold.

House Democrats and their union allies despise this tax. Last week, the president caved in to their pressure and pushed the start date of the tax back to 2018, well past the point when he will have left office. Even so, Orszag and DeParle still claim credit for the massive revenue hike that would occur in a second decade of implementation. They want us to believe we can finance a permanent, expensive, and rapidly growing new entitlement program with a tax the president himself was never willing to collect.

In Medicare, Orszag and DeParle like to highlight so-called “delivery system reforms” the administration has touted. In the main, these are extremely small-scale initiatives and pilot programs. CBO says they will amount to virtually no savings. The big Medicare cuts in the president’s plan come from across-the-board payment-rate reductions. In particular, the president wants to cut the inflation update for hospitals, nursing homes, and others by half a percentage point every year, in perpetuity. On paper, this change produces huge long-run savings. But it does nothing to control the underlying cost of treating patients. It just pays everyone less, without regard to patient need or quality of care. The chief actuary of the program has said repeatedly that these cuts are completely unrealistic for these very reasons. If implemented, he expects they would drive one in five facilities into serious financial distress. And yet Orszag and DeParle want us to believe these savings can be counted to finance the president’s massive entitlement promises.

And massive they are. CBO says the coverage expansion provisions in the Senate-passed bill would cost about $200 billion by 2019, and that cost would rise 8 percent every year thereafter.

But even these estimates understate the true cost of Obamacare. The president’s plan, like the House and Senate bills, would extend generous new insurance subsidies to low- and moderate-wage workers getting insurance through the new “exchanges.” Workers in job-based plans would get no additional help. That means two workers with identical incomes would be treated very differently. Gene Steuerle of the Urban Institute has estimated that, in 2016, a worker with job-based coverage and a $60,000 income would get $4,500 less than someone with the same income but health insurance through the exchange. This kind of inequitable treatment would never last: one way or another, the entitlement would get extended to everyone in the targeted income range, sending the overall costs of the program soaring.

The president started off last year by saying he wanted to “bend the cost-curve” even as he broadened coverage. But after a year of partisan political and legislative maneuvering, all that’s left is a massive entitlement expansion. The new costs would get piled on top of the unreformed and unaffordable entitlements already on the books. It’s a budgetary disaster in the making.

http://blog.heritage.org/2010/03/08/…eaks-the-bank/