Milton Friedman's Centenary by Thomas Sowell

By Thomas Sowell on 8.1.12 @ 6:07AM

A former Marxist student of the great economist and professor recalls a true liberal.

If Milton Friedman were alive today -- and there was never a time when he was more needed -- he would be one hundred years old. He was born on July 31, 1912. But Professor Friedman's death at age 94 deprived the nation of one of those rare thinkers who had both genius and common sense.
Most people would not be able to understand the complex economic analysis that won him a Nobel Prize, but people with no knowledge of economics had no trouble understanding his popular books like Free to Choose or the TV series of the same name.
In being able to express himself at both the highest level of his profession and also at a level that the average person could readily understand, Milton Friedman was like the economist whose theories and persona were most different from his own -- John Maynard Keynes.
Like many, if not most, people who became prominent as opponents of the left, Professor Friedman began on the left. Decades later, looking back at a statement of his own from his early years, he said: "The most striking feature of this statement is how thoroughly Keynesian it is."
No one converted Milton Friedman, either in economics or in his views on social policy. His own research, analysis, and experience converted him.
As a professor, he did not attempt to convert students to his political views. I made no secret of the fact that I was a Marxist when I was a student in Professor Friedman's course, but he made no effort to change my views. He once said that anybody who was easily converted was not worth converting.
I was still a Marxist after taking Professor Friedman's class. Working as an economist in the government converted me.
What Milton Friedman is best known for as an economist was his opposition to Keynesian economics, which had largely swept the economics profession on both sides of the Atlantic, with the notable exception of the University of Chicago, where Friedman was both trained as a student and later taught.
In the heyday of Keynesian economics, many economists believed that inflationary government policies could reduce unemployment, and early empirical data seemed to support that view. The inference was that the government could make careful trade-offs between inflation and unemployment, and thus "fine tune" the economy.
Milton Friedman challenged this view with both facts and analysis. He showed that the relationship between inflation and unemployment held only in the short run, when the inflation was unexpected. But, after everyone got used to inflation, unemployment could be just as high with high inflation as it had been with low inflation.
When both unemployment and inflation rose at the same time in the 1970s -- "stagflation," as it was called -- the idea of the government "fine tuning" the economy faded away. There are still some die-hard Keynesians today who keep insisting that the government's "stimulus" spending would have worked, if only it was bigger and lasted longer.
This is one of those heads-I-win-and-tails-you-lose arguments. Even if the government spends itself into bankruptcy and the economy still does not recover, Keynesians can always say that it would have worked if only the government had spent more.
Although Milton Friedman became someone regarded as a conservative icon, he considered himself a liberal in the original sense of the word -- someone who believes in the liberty of the individual, free of government intrusions. Far from trying to conserve things as they are, he wrote a book titled Tyranny of the Status Quo.
Milton Friedman proposed radical changes in policies and institutions ranging from the public schools to the Federal Reserve. It is liberals who want to conserve and expand the welfare state.
As a student of Professor Friedman back in 1960, I was struck by two things -- his tough grading standards and the fact that he had a black secretary. This was years before affirmative action. People on the left exhibit blacks as mascots. But I never heard Milton Friedman say that he had a black secretary, though she was with him for decades. Both his grading standards and his refusal to try to be politically correct increased my respect for him.

About the Author

Thomas Sowell is a senior fellow at the Hoover Institution, Stanford University, Stanford, CA 94305. His website is www.tsowell.com.

Obama's Calculated Deception

By Peter Ferrara on 8.1.12 @ 6:08AM

How the Obama campaign is trying to deceive you on the economy.

Calculated Deception. That is the central theme of the Obama campaign. Calculated Deception is the term I use for Obama's rhetorical practice of trying to take advantage of what he calculates the average person does not know, and his party-controlled, so-called mainstream media won't report. And that can be seen over and over in the Obama campaign.
Obscuring the Worst Recovery Since the Great DepressionIn Monday's Wall Street Journal, Edward Lazear, former Bush chairman of the President's Council of Economic Advisors, notes, "A graph titled 'Private Sector Job Creation' on the Obama-Biden campaign website… announces proudly that 4.4 million private sector jobs have been created over the past 28 months." But that factoid is meaningless out of any context, more like a pediatrician boasting to you that under his care your 16-year-old son has grown to 4 feet 4 inches. At the same point during the Reagan recovery, the economy had created 9.5 million new jobs.
Moreover, Lazear correctly adds, "there hasn't been one day during the entire Obama presidency when as many Americans were working as on the day President Bush left office." That's right, contrary to the Obama campaign's misleading claim of 4.4 million new jobs created, total jobs today are still half a million less than in January 2009 when Obama entered office.
Lazear continues, "Moreover, the unemployment rate, which we were told would not exceed 8% if we enacted Mr. Obama's stimulus package…has never fallen below 8% during his presidency. The rate has averaged 9.2% since February 2009." In sharp contrast, after Bush's tax rate cuts were all fully implemented in 2003, the economy created 7.8 million new jobs over the next 4 years and the unemployment rate fell from over 6% to 4.4%. We won't see that again until Obama is out of office.
President Obama and his chairman of the Council of Economic Advisors, Alan Krueger, brag that private sector jobs have now grown for "28 straight months." Obama and Krueger apparently think most Americans do not know that job growth is the norm and not the exception for the American economy. In the 62 years from January 1946, after World War II, until January 2008, jobs grew in 86% of the months, or 640 out of 744. Reagan's recovery produced job growth in 81 out of its first 82 months, with 20 million new jobs created over those 7 years, increasing the civilian workforce at the time by 20%. Even George W. Bush oversaw 52 consecutive months of job growth, including nearly 8 million new jobs created after his 2003 capital gains and dividends tax rate cuts became effective (which Obama is dedicated to reversing).
The relevant streak of Obamanomics was extended in the June jobs report. That report established that under President Obama America has suffered 41 straight months of unemployment over 8%, which the Joint Economic Committee of Congress confirms is the worst recovery from a recession since the Great Depression almost 75 years ago. Indeed, the last time before Obama unemployment was even over 8% was December 1983, when Reaganomics was bringing it down from the Keynesian fiasco of the 1970s. It didn't climb back above that level for 25 years, a generation, which is a measure of the spectacular success of Reaganomics.
But Krueger tells us about that June jobs report, "It is important not to read too much into any one monthly report." The Obama Administration, however, has said the exact same thing for each of the last 30 months, as documented July 6 by Bryan Preston for PJMedia.
How Stupid Does He Think We Are?President Obama keeps telling us his economic program should be judged by comparison to the worst of the recession. Look, we have turned the corner, he says, and the economy has started growing again, just like your teenage son. But the correct comparison is to prior recoveries from past recessions. As Lazear explained, "Yet we know that all recessions end and that labor markets recover eventually. What distinguishes this labor-market recovery is not that jobs are finally being created but rather the growth rate is so slow that it will be 2016 before we return to pre-recession employment levels." Obama is campaigning as if he were certain that a majority of Americans do not know that all recessions end and that labor markets recover eventually.
American recessions since the Great Depression previously have lasted an average of 10 months, with the longest at 16 months. But this latest recession began in December 2007. The June labor report showed that the most commonly cited U3 unemployment rate remains stuck at 8.2%, with the number of unemployed Americans actually rising over the last 3 months by 76,000, 54 months after the recession started, and 3 years after it was supposedly over, the longest period of unemployment that high since the Great Depression.
Barack Obama knows that history, even though he is sure a majority of you don't. That is why he was confident enough to tell Matt Lauer and the nation in February 2009 regarding economic recovery: "If I don't have that done in three years, then this is going to be a one-term proposition." And it is why the Administration so confidently labeled the summer of 2010 "Recovery Summer," as by historical standards the recovery was already way overdue by then.
Obama's tragic jobs record reflects the dismal economic growth under his administration's throwback, Keynesian economic policies. For all of last year, the economy grew by a paltry real rate of 1.7%, only about half America's long-term trend. The average so far this year has been no better. That dismal growth is further reflected in the Census Bureau reports of falling real wages under Obama, kicking median family income back over 10 years, with more Americans in poverty today than at any time in the more than 50 years that Census has been tracking poverty.
In sharp contrast, in the second year of Reagan's recovery, the economy boomed by a real rate of 6.8%, the highest in 50 years. Real per capita disposable income increased by 18% from 1982 to 1989, meaning the American standard of living increased by almost 20% in those first 7 years of the Reagan boom alone. The poverty rate, which had started increasing during the Carter years, declined every year from 1984 to 1989, dropping by one-sixth from its peak. That is the proper comparison for Obama's economic performance.
Obama cannot explain away the disgraceful failure of his Keynesian economic policies by arguing it is because the recession he inherited from Bush was so bad. The American historical experience is that the worse the recession, the stronger the recovery, as the American economy snaps back to its world-leading, long-term, economic growth trend line. Based on this historical record, we should be enjoying the third year of a raging economic recovery boom right now.
But the dismal economic performance we have suffered instead, with no real recovery from the steep 2008-2009 recession at all, is because Obama has so thoroughly followed the opposite of every policy of Reaganomics. I first argued in the Wall Street Journal in February 2009 that Obamanomics was going to produce the opposite of Reaganomics as a result. That is what is now just beginning to happen.
"The Rich" and Their Fair ShareWe can see the same Calculated Deception in regard to President Obama's tax policy, where he has been barnstorming the country for three years now telling us that "the rich" (whatever that is supposed to mean) do not pay their fair share of federal taxes, and the middle class pays more as a result. But the CBO issued a report last month that proves him grievously wrong.
"The Distribution of Household Income and Federal Taxes, 2008 and 2009," issued by CBO on July 10, reports that the top 1% of income earners paid 39% of federal individual income taxes in 2009, while earning 13% of the income. That means their share of federal income taxes was three times their share of income.
And that is down from 2007, before President Obama was even elected. In that year, after 25 years of Reagan Republican tax policies, the top 1% paid 40% of federal individual income taxes. That was more than double the 17.6% of federal individual income taxes paid by the top 1% when President Reagan entered office in 1981.
Also in 2007, again before Obama was even elected, and after 25 years of Reaganomics, the bottom 40% of income earners on net as a group paid less than 0% of federal income taxes. Instead of paying at least some income taxes to help support the federal government, the federal government paid them cash through the income tax code.
Does that reality sound like what you hear in President Obama's deceiving speeches?
CBO further reported that in 2009 the top 20% of income earners, those earning more than $74,000, paid 94% of federal individual income taxes, virtually all of the net total. That was 85% more than the share of national income they earned.
Yet, in that same year, the middle 20% of income earners, the true middle class, paid 2.7% of total federal individual income taxes on net, while earning 15% of before-tax income. And the bottom 40% of income earners, instead of paying some income taxes to support the federal government, were paid by the IRS cash equal to 10% of federal individual income taxes on net.
That means altogether the bottom 60% of income earners, which includes the middle class, paid less than 0% of total federal individual income taxes as a group on net. Instead, as a group, they received net cash payments from the IRS on net.
Ignorant or Lying?The Obama campaign continues its Calculated Deception in saturating the Internet with advertising alleging that Mitt Romney's "tax plan" would raise taxes on the middle class and working families. Not only has Romney proposed no such thing. House Republicans have already voted for Rep. Paul Ryan's tax reform plan that would cut the federal income tax rate for all families earning less than $100,000 to 10%, and Romney has endorsed that as well.
Indeed, the whole history of Republican tax policy going back to Reagan is that Republicans have never raised income taxes on the middle class and working people. Quite to the country, Reagan and his Republicans abolished federal income taxes on what the Left calls the working class, and almost abolished them for the middle class, as the official data discussed above shows.
That began with the Earned Income Tax Credit (EITC), which grew out of then Governor Ronald Reagan's famous testimony before the Senate Finance Committee in 1972, where he proposed exempting the working poor from all Social Security and income taxes as an alternative to welfare, with the credit serving as a way to offset payroll taxes for the poor and low income workers. As President, Reagan cut federal income tax rates across the board for all taxpayers by 25%. He also indexed the tax brackets for all taxpayers to prevent inflation from pushing working people into higher tax brackets.
In the Tax Reform Act of 1986, President Reagan reduced the federal income tax rate for middle and lower income families all the way down to 15%. That Act also doubled the personal exemption, shielding a higher proportion of income from taxation for lower income workers than for higher income workers.
Newt Gingrich's Contract with America adopted a child tax credit of $500 per child that also reduced the tax liabilities of lower income people by a higher percentage than for higher income people. President Bush doubled that credit to $1,000 per child, and made it refundable so that low-income people who do not even pay $1,000 in federal income taxes could still get the full credit. Bush also adopted a new lower tax bracket for the lowest income workers of 10%, reducing their federal income tax rate by 33%.
That is how we reached the point by 2007 where the bottom 40%, or even 60%, of income earners as a group on net were being paid by the federal income tax code instead of paying federal income taxes. So when then candidate Obama said in 2008 that Republicans cut taxes for the rich, but haven't "given a break to folks who make less," was he ignorant or lying?
Obama's lying allegation regarding Romney flies in the face of that reality. Rather, it is Obama who has raised taxes on the middle class, in gross violation of his 2008 campaign pledge not to do so. That has been held, in fact, by the United States Supreme Court, which ruled that the individual mandate in Obamacare is constitutional precisely because it is a tax. And that individual mandate tax applies to the middle class, and working people. Moreover, Obamacare includes several other tax increases that apply to the middle class, and working people, such as the new tax on medical devices, the new tax on health insurance, the new tax on prescription drugs, and others.
Blame Obama on the Democrat PartyThe Obama campaign is trailblazing new realms of dishonesty in the history of American politics, bringing to America for the first time Soviet-style propaganda that flies in the direct face of reality, buttressed by dishonest, party-controlled media operations. Moreover, it is a classically abusive Saul Alinsky trick to accuse your opponent of planning to do exactly what you have done, as Obama does in continually accusing Romney of proposing to raise taxes on the middle class. Only an idiot can fail to see that the entire Democrat party's spending plans require sweeping tax increases on the middle class.
The bottom line is that the entire Democrat party needs to be held responsible for Obama, the abusive dishonesty of his campaign operation, and the accelerating downward spiral of America his neo-Marxist policies are producing. Those policies in fact are not unique to Obama, but represent the heart and soul of today's Democrat party. This is a Paul Revere moment for the American people. The only way to save your country is for each of you to rally your friends, neighbors, and relatives this fall to come out in force and defeat the entire Democrat party root and branch.

About the Author

Peter Ferrara is Director of Entitlement and Budget Policy for the Heartland Institute, General Counsel of the American Civil Rights Union, and Senior Fellow for the National Center for Policy Analysis. He served in the White House Office of Policy Development under President Reagan, and as Associate Deputy Attorney General of the United States under the first President Bush. He is the author of America’s Ticking Bankruptcy Bomb (HarperCollins).

Establishment "primaried" again by Tea Party

The establishment candidate for U.S. Senator from Texas was "primaried" once again by the Tea Party candidate Ted Cruz in a woodshed beating of 57% to 43%. That is a 14 point difference. Cruz will now face the democrat candidate in November for the Senate seat. This goes to show the people who make the country work will show up and vote out not only democrats but the rinos as well in our effort to right the country. We are in this for the long haul. We are watching and paying attention, and we are not going away...

This U.S. Citizen

------------------

Why Cruz Won

By Katrina Trinko

July 31, 2012 10:10 P.M.

The Associated Press has called the Texas Senate runoff for Ted Cruz — an ending that was by no means a certainty in recent weeks, despite Cruz’s popularity among conservatives.

Even after Cruz eked out a second-place finish in the May 29 primary and succeeded in keeping rival David Dewhurst beneath the 50 percent threshold he needed to avoid a runoff, it didn’t look he had accomplished much beyond buying himself another few more weeks to campaign.
Dewhurst, after all, had beaten Cruz by eleven points in the primary. The late momentum Cruz had gathered in the race, thanks to endorsements from figures such as Sarah Palin, had boosted his support significantly, but not enough to put him close to Dewhurst. And it looked like it was Dewhurst who had all the advantages, beginning with money. (Dewhurst ultimately poured about $25 million of his own fortune into the race.) It was believed that voters who had voted for Tom Leppert and Craig James, the other two candidates in the first round of the primary, were likely to either vote for Dewhurst or stay home. Nor did there seem to be much danger that Dewhurst’s own voters would give Cruz another look, and reconsider their votes.
Dewhurst had experience winning statewide races, and a wide range of political connections thanks to his long tenure as the state’s lieutenant governor. There were also accusations that Dewhurst was using that position (something his campaign denied) to push politicians to not announce support for Cruz: “If you or your client have any legislative agenda whatsoever, there’s always fear of retribution. And so nobody can get out there and publicly support Ted,” one Texas lobbyist who supported Cruz told me.
So why did Cruz win? Well, one significant change: the percentage of tea-party voters he was attracting. A late May PPP poll, taken before the first round of the primary, showed that 38 percent of Tea Partiers backed Cruz, while 39 percent backed Dewhurst. But in PPP’s poll from this past weekend, that dynamic had changed significantly, with Cruz now getting 75 percent of tea partiers and Dewhurst winning only 22 percent.
In addition, Dewhurst’s attack ads may have backfired, making him a less likeable figure to voters and failing to tarnish Cruz’s reputation significantly. (Dewhurst’s negative ads in the primary may have also helped raise Cruz’s name ID.)
And while Dewhurst didn’t have any “oops” moments in the three debates he had with Cruz during the runoff, it was Cruz, who is a lawyer, who tended to shine on the debate stage, not Dewhurst.
The state convention, also held after the primary, proved to be another powerful point in the race, showcasing which candidate had won over the grassroots. The booing Rick Perry received when he touted Dewhurst, whom he had already endorsed, made it clear that grassroots conservatives, no matter how they felt toward Perry himself (I heard from some that they disagreed with Perry’s endorsement of Dewhurst, but still supported Perry generally), were not inclined to necessarily take his advice on whom to make the next Senate GOP nominee in Texas.
Cruz also got significant help from various conservative groups, including Club for Growth and FreedomWorks. The Dewhurst campaign tried to twist this into a negative, blasting Cruz as “TeDCruz” and saying he was supported by Washington insiders, not Texans. Based on tonight’s results, that argument didn’t resonate.
Cruz announced he was running back in January of last year. He’s had a long, tough slog since then. There were plenty of reasons to doubt that he would be able to pull off victory; considering how he came into this race — without the level of name ID, establishment connections, or financial resources that David Dewhurst possessed — and it’s fair to consider this an upset. 

----------------------------------------

In Texas, the Tea Party Hobbits Rehearse their November March

Lee Cary

Someone wake up James "The Raging Cajun" Carville, who recently declared the Tea Party as being "over," and give him the FOX News from Texas.

"Tea party darling Ted Cruz convincingly defeated the Republican establishment favorite, Lt. Gov. David Dewhurst, in Texas' runoff election Tuesday, capturing the GOP nomination to replace retiring U.S. Sen. Kay Bailey Hutchison as fiercely conservative voters shook one of America's reddest states to its political core."

Cruz was supported by Tea Party organizations all across Texas. Update: Cruz's margin of victory was 14 points - which qualifies as a landslide.
Dewhurst received the support of the Texas GOP establishment, including campaign appearances by Governor Rick Perry. 
Dewhurst considerably out-spent Cruz, and reportedly contributed millions of dollars out of his substantial resources to his own campaign.
Cruz is the son of a Cuban refugee who escaped from Cuba in 1957.  He was the first Hispanic to clerk for a SCOTUS Chief Justice (William Rehnquist).   From 2003-2008, Cruz was the Solicitor General for the State of Texas.
Last June 27, Breitbart's Big Government reported that Carville wrote,
"These Tea Party Republicans have worn out their welcome. But I'm telling you - getting rid of 'em won't be easy. They're not leaving on their own. We're going to have to boot them out the door like unwanted house guests."  
Despite Carville's pronouncement, it seems clear that the Tea Party is not over, by a long shot.

Page Printed from: http://www.americanthinker.com/blog/2012/08/in_texas_the_tea_party_hobbits_rehearse_their_november_march.html at August 01, 2012 - 09:34:36 AM CDT

Messing with Texas

By Windsor Mann

July 27, 2012 4:00 A.M.

Liberals talk about Texas the way conservatives talk about France, only with more passion and profanity. During an appearance on Don Imus’s radio show in 2007, MSNBC’s Chris Matthews said, “I’m so sick of southern guys with ranches running this country. I want a guy to run for president who doesn’t have a f***ing ranch.” Asked why he was swearing on the air, Matthews said, “I don’t know. I got excited.” F-ing excited.

This is what Texas does to liberals.
In her new book, As Texas Goes . . . : How the Lone Star State Hijacked the American Agenda, Gail Collins, an Ohioan by birth and a New York Times columnist, says that Texas is running the country and also ruining it. In her view, Texas is “frequently somewhat lunatic,” as evidenced, for example, by “its completely crazy abstinence-only sex education in high school,” “its lunatic war on family planning,” and its board of education’s “overall craziness.”
To be sure, Texas politicians can be unhinged at times. In 2003, Representative Debbie Riddle of Houston asked, “Where did this idea come from that everybody deserves free education, free medical care, free whatever? It comes from Moscow, from Russia. It comes straight out of the pit of hell.” Such talk is not only uncivil and theologically unsound but also factually inaccurate. The idea of free education, after all, came from Leningrad, not Moscow.
Texas’s craziness wouldn’t be so ominous but for the fact that, according to Collins, “Texas runs everything.” Whether or not it does, it is clear that liberals want to run everything in Texas. For example: “We,” Collins told Rachel Maddow, “should get to have a little bit of a say about whether or not there is any family planning [in Texas].”
Among the problems Collins finds in the state are “a tax system that favors the wealthy”; lax environmental regulations; a “stupendous lack of enthusiasm for ongoing social services”; the state’s gun laws; its voter-identification laws (“your gun license counts as a voter ID but not your university ID card”); weak labor unions; low voter turnout, specifically among minorities and other traditional Democratic constituencies; “education privatization”; its school textbooks; its style of sex education, which teaches that having sex carries the risk of “transmission of the Ebola virus”; its population growth (surprisingly high for a state where Ebola is an STD); “the almost complete lack of state family planning funds”; “a two-tiered economy in which the failing underclass looks resentfully at the happy sliver on the top”; and “its obsession with states’ rights.” Texas’s problems, you see, are mostly conservative problems. And the cure is liberalism, or what Collins calls “the American agenda.”
The debate, of course, really isn’t about Texas’s problems so much as it is about the Left’s problems with Texas. As far back as 1964, The Nation found “something rotten in the state of Texas.” Twenty years later, Nicholas Lemann deemed Texans to be “sorely lacking in compassion” (i.e., sorely lacking in government social programs). Michael Lind faulted Texas for having “a primitive extractive economy,” “inadequate spending on public goods like education and pollution abatement,” and “a cruel caste society” in which minorities toil for the benefit of “a cultivated but callous oligarchy of rich white families.” A liberal columnist for the St. Petersburg Times said that even friendly Texans “have conservatism’s instinctive meanness.” The late Molly Ivins referred to Texas as “the National Laboratory for Bad Government” (a title more suitable for the District of Columbia).
This last point is an important one. One of the advantages of federalism is that it allows each state to serve as a laboratory of democracy. “It is one of the happy incidents of the federal system,” Justice Louis D. Brandeis wrote in 1932, “that a single courageous state may, if its citizens choose, serve as a laboratory, and try novel social and economic experiments without risk to the rest of the country.”
Inevitably, the results aren’t always gratifying. But just because you don’t like the way one state conducts its affairs, that is no reason to subvert the experimental process.
What liberals don’t like about Texas is their inability to transform it. “The rest of the country can’t do all that much to dictate where Texas goes,” Collins laments, “what with states’ rights, states’ rights, states’ rights.” She wants Americans to “work together for our great national goals [i.e., liberal goals] rather than obsessing so much about how we want to be left alone.” Is it any wonder that Texans want to be left alone when New York Times columnists seek to convert their state into a big Massachusetts?
If Texas is inflicting damage on the country, federalism can mitigate the damage. It cannot solve the problems in Texas, but it can contain most of them. Sometimes the best way to settle disagreements is to avoid them. As a general rule, it’s better to localize the problems than to nationalize the solutions. Let Texans mess with Texas.
— Windsor Mann is the editor of The Quotable Hitchens: From Alcohol to Zionism.

Burn Down the Suburbs?

By Stanley Kurtz

August 1, 2012 4:00 A.M.

President Obama is not a fan of America’s suburbs. Indeed, he intends to abolish them. With suburban voters set to be the swing constituency of the 2012 election, the administration’s plans for this segment of the electorate deserve scrutiny. Obama is a longtime supporter of “regionalism,” the idea that the suburbs should be folded into the cities, merging schools, housing, transportation, and above all taxation. To this end, the president has already put programs in place designed to push the country toward a sweeping social transformation in a possible second term. The goal: income equalization via a massive redistribution of suburban tax money to the cities.

Obama’s plans to undercut the political and economic independence of America’s suburbs reach back decades. The community organizers who trained him in the mid-1980s blamed the plight of cities on taxpayer “flight” to suburbia. Beginning in the mid-1990s, Obama’s mentors at the Gamaliel Foundation (a community-organizing network Obama helped found) formally dedicated their efforts to the budding fight against suburban “sprawl.” From his positions on the boards of a couple of left-leaning Chicago foundations, Obama channeled substantial financial support to these efforts. On entering politics, he served as a dedicated ally of his mentors’ anti-suburban activism.
The alliance endures. One of Obama’s original trainers, Mike Kruglik, has hived off a new organization called Building One America, which continues Gamaliel’s anti-suburban crusade under another name. Kruglik and his close allies, David Rusk and Myron Orfield, intellectual leaders of the “anti-sprawl” movement, have been quietly working with the Obama administration for years on an ambitious program of social reform.
In July of 2011, Kruglik’s Building One America held a conference at the White House. Orfield and Rusk made presentations, and afterwards Kruglik personally met with the president in the Oval Office. The ultimate goal of the movement led by Kruglik, Rusk, and Orfield is quite literally to abolish the suburbs. Knowing that this could never happen through outright annexation by nearby cities, they’ve developed ways to coax suburbs to slowly forfeit their independence.
One approach is to force suburban residents into densely packed cities by blocking development on the outskirts of metropolitan areas, and by discouraging driving with a blizzard of taxes, fees, and regulations. Step two is to move the poor out of cities by imposing low-income-housing quotas on development in middle-class suburbs. Step three is to export the controversial “regional tax-base sharing” scheme currently in place in the Minneapolis–St. Paul area to the rest of the country. Under this program, a portion of suburban tax money flows into a common regional pot, which is then effectively redistributed to urban, and a few less well-off “inner-ring” suburban, municipalities.
The Obama administration, stocked with “regionalist” appointees, has been advancing this ambitious plan quietly for the past four years. Efforts to discourage driving and to press development into densely packed cities are justified by reference to fears of global warming. Leaders of the crusade against “sprawl” very consciously use environmental concerns as a cover for their redistributive schemes.
The centerpiece of the Obama administration’s anti-suburban plans is a little-known and seemingly modest program called the Sustainable Communities Initiative. The “regional planning grants” funded under this initiative — many of them in battleground states like Florida, Virginia, and Ohio — are set to recommend redistributive policies, as well as transportation and development plans, designed to undercut America’s suburbs. Few have noticed this because the program’s goals are muffled in the impenetrable jargon of “sustainability,” while its recommendations are to be unveiled only in a possible second Obama term.
Obama’s former community-organizing mentors and colleagues want the administration to condition future federal aid on state adherence to the recommendations served up by these anti-suburban planning commissions. That would quickly turn an apparently modest set of regional-planning grants into a lever for sweeping social change.
In light of Obama’s unbroken history of collaboration with his organizing mentors on this anti-suburban project, and his proven willingness to impose ambitious policy agendas on the country through heavy-handed regulation, this project seems likely to advance.
A second and equally ambitious facet of Obama’s anti-suburban blueprint involves the work of Kruglik’s Building One America. Traditionally, Alinskyite community organizers mobilize leftist church groups. Kruglik’s group goes a step further by organizing not only the religious left but politicians from relatively less-well-off inner-ring suburbs. The goal is to build coalitions between urban and inner-ring suburban state legislators, in a bid to force regional tax-base sharing on middle-class suburbanites. That is how the practice came to Minnesota.
The July 2011 White House conference, gathering inner-ring suburban politicians for presentations by Rusk and Orfield, was an effort to place the prestige of the Obama administration behind Kruglik’s organizing efforts. A multi-state battle over regional tax-base “sharing,” abetted by the president, would usher in divisive class warfare on a scale likely to dwarf the puny efforts of Occupy Wall Street.
Obama’s little-known plans to undermine the political and economic autonomy of America’s suburbs constitute a policy initiative similar in ambition to health-care reform, the stimulus, or “cap-and-trade.” Obama’s anti-suburban plans also supply the missing link that explains his administration’s overall policy architecture.
Since the failure of Lyndon Johnson’s War on Poverty and the collapse of federal urban policy, leftist theorists of community organizing have advocated a series of moves designed to quietly redistribute tax money to the cities. Health-care reform and federal infrastructure spending (as in the stimulus) are backed by organizers as the best ways to reconstitute an urban policy without directly calling it that. A campaign against suburban “sprawl” under the guise of environmentalism is the next move. Open calls for suburban tax-base “sharing” are the final and most controversial link in the chain of a reconstituted and redistributive urban policy. President Obama is following this plan.
Middle-class suburban supporters of the president take note. It isn’t just the pocketbooks of the “1 percent” he’s after; it’s yours.
— Stanley Kurtz is a senior fellow at the Ethics and Public Policy Center.