Freedom Line Blog

In what sometimes seems like an era of constantly expanding government and demonization of free markets, a recent Gallup poll offers refreshing news – Americans overwhelmingly view free markets positively, especially relative to the federal government:

Political candidates would be wise to emphasize this in an election year 2022, and elected leaders would be wise to translate Americans’ preference into concrete action.

On the heels of Friday’s unsettling jobs report from the Labor Department, we can now judge the performance and promises of Joe Biden and the Pelosi/Schumer Congress against actual reality.  They promised 10.3 million jobs would be created in 2021 if their massive spending and regulation blowout passed, versus 6.3 million jobs if their agenda wasn’t passed.  So how did it turn out?  Their agenda was passed, but only 6.1 million jobs were created as the U.S. economy slowed and struggled to recover from the Covid dip, as AEI’s Matt Weidinger highlights.  They apparently made things worse, not better, illustrating the sardonic adage, “Don’t just do something – stand there.”

Biden Jobs Performance: Worse Than Doing Nothing

So the latest talking point from the political left is that the Biden Economy is doing just great, and you rubes who believe otherwise just don’t get it that he’s somehow turbocharging it.  In other words, whom are you going to believe – Joe Biden and his apologists, or your lying eyes?  Biden himself even said that his policies have accelerated growth and unless his monstrous “Build Back Better” overcomes Senator Joe Manchin’s opposition and passes in the new year, our economy is “not going to grow.”  Yes, he literally said that.

Well, here’s more for those lying eyes of yours, from the federal government’s own official numbers.  The U.S. economy isn’t accelerating under Biden, it’s slowing in a disturbing way:

Biden Economy Slowing, Not Accelerating

Something to keep handy as the Biden Administration and its cheerleaders feed falsity in pursuit of their agenda as the 2022 elections approach.

As if enough reasons to oppose Joe Biden’s “Build Back Better” agenda, from destructive drug price controls to higher taxes, didn’t already exist:

Build Back Bigger (Inflation)

In some impressive and instructive news, the state of Nebraska just claimed the lowest unemployment rate ever recorded.  The likely reason shouldn’t surprise anyone:

Nebraska’s jobless rate tends to run below the national rate. Economists cite a combination of factors that have kept joblessness in the state well below the U.S. average from the onset of the pandemic. Nebraska had fewer government-imposed restrictions on business, helping it avoid steep job losses some states experienced earlier in the pandemic.”

At some point, perhaps other more stubbornly leftist states will catch on before every one of their residents and businesses flees to more economically hospitable states with fewer regulations, lower taxes and less government generally.  But don’t hold your breath just yet.

In the wake of this month’s catastrophic election results for Joe Biden and his party, many leftists stubbornly rationalized that voters were upset that Biden hadn’t seen more of his agenda passed, and that the answer to Biden’s and Democrats’ ills was to step on the gas and pass more of that agenda.  Well, the new ABC News/Washington Post poll offers and instant rebuttal.  The survey is nothing short of catastrophic for Biden and Democrats as 2022 approaches, with Republicans scoring record preferences (see image below).  But note something else:  This poll was conducted November 7 – 10, AFTER Biden’s “infrastructure” spending bill was passed.

“Build Back Better” Is a Loser

We at CFIF have detailed the catastrophic potential effects of passing Biden’s even larger spending bill currently before Congress, including its potentially devastating consequences for American healthcare and pharmaceutical innovation:

Specifically, they’re attempting to cement agreement on provisions that would empower the federal government to begin “negotiating” drug prices with manufacturers and imposing draconian penalties upon providers that don’t play ball.

That constitutes a scheme to bring price controls to American healthcare, with catastrophic effects, according to analyses from both the non-partisan Congressional Budget Office (CBO) as well as the University of Chicago.”

This new ABC News/Washington Post poll should offer a cautionary tale for Senators Joe Manchin (D – West Virginia), Kirsten Sinema (D – Arizona) or anyone else even contemplating voting for it.

Late last week we highlighted how some far-left climate radicals in Congress mindlessly, obsessively and ostentatiously continue to demonize domestic energy producers – who achieved what was once considered fantasy by securing U.S. energy independence and lowering energy costs for American consumers – even while they and the Biden Administration beg OPEC and Russia to increase petroleum production.  The Wall Street Journal’s always-insightful Holman Jenkins brilliantly notes the proverbial emperor’s lack of clothing on that same Congressional obsession:

As it cyclically does, the hypocrisy show returned this week to ‘Big Oil.’  To cover up the political class’s, and particularly Joe Biden’s, inability to do anything meaningful about climate change, a House hearing on Thursday accused industry CEOs of blocking action as if somehow the pennies they spent on advocacy could haven countered the 30-year torrent of climate-change propaganda coming from governments, universities, green lobbyists and scientific organizations.  ‘They are obviously lying like the tobacco executives were,’ intoned Rep. Carolyn Maloney, in windup-toy fashion.  This line she was guaranteed to utter no matter what was said at the hearing (in fact, executives repeated what their companies had long said about the risks of climate change and the lack of alternatives to fossil fuels).

Most of us would be repulsed to behave the way politicians routinely do, which brings us to an unexpected counterpoint.  For want of something shiny to wave at next week’s global climate summit, and not too discerning about what it was, President Biden caused the U.S. intelligence services to gin up a new climate assessment.  Lo, the result is notable mainly for its skepticism about the kind of summits Mr. Biden will be attending…

At least one establishment institution has stopped paying lip service to the pipe dream that the world will give up fossil fuels on a timespan relevant to our climate risks.”

In our Liberty Update this week, we highlight the Biden Administration’s role in rising inflation, some of its under-discussed negative consequences and its shockingly tone-deaf responses and rationalizations.  In  positive news from NCTA, The Internet & Television Association, however, internet service provider costs are actually declining:

Good News: Internet Service Costs Decline

As the U.S. economy shows sudden weakness, American consumers understandably express increasing anxiety.  A troubling new Gallup survey reports that economic confidence has now declined to lows unsurpassed since the early days of the Covid pandemic in 2020.

Undeterred by that accumulating weakness and alarm, however, Senator Elizabeth Warren (D – Massachusetts) appears restless to strike yet another dangerous hammer blow by re-introducing her misnamed “Stop Wall Street Looting Act.”

She may think that title can conceal the bill’s danger, but Americans and elected officials mustn’t be fooled or invite the potentially catastrophic economic peril.

Senator Warren’s bill includes significant tax increases, as well as new legal liabilities and bureaucratic regulations on U.S. investment, and it seeks to reshape the entire American bankruptcy code in an environment already suffering excessive anxiety.  The legislation would also begin taxing private equity as ordinary income, which makes no sense because private equity investments come with an inherent risk of loss, unlike ordinary wages.  It would thereby eviscerate investors’ incentive to risk capital because any future earnings would be taxed in the same as ordinary wages that carry no similar risk of loss.  When investments fail, the risk of loss is carried by the investors.  That means lots of downside, but significantly less upside.

And as studies confirm, the economic impact of Senator Warren’s bill would be devastating.

Specifically, it would kill off between 6.9 million and 26.3 million jobs across the U.S., while actually reducing incoming federal, state and local tax revenues between a whopping $109 billion and $475 billion each year.  It would also wipe out between $671 million and $3.36 billion in investments per year (with pension fund retirees accounting for many of those investors), and would drive many private equity firms out of business due to the bill’s elevated risks and regulations.

The good news is that even moderate Democrats express objection to Senator Warren’s idea.  Politico reports that, “It’s setting up a clash with moderate Democrats who say private equity is a crucial tool to keep capital flowing to businesses and propel economic growth.”

American workers, retirees, investors, public pension beneficiaries and employers shouldn’t be forced to pay the price for Senator Warren’s pet ideological agenda, and Congress must unequivocally reject her proposed bill.

From Andy Puzder, a snapshot of how inflation dreadfully continues to outpace American workers’ paycheck gains:

Biden’s Inflationary Gift

The Biden Administration’s failures aren’t exclusively overseas in nature.  For seven consecutive months now, average U.S. hourly wages have declined when adjusted for inflation.

The Biden Inflation Boom

From RealClearPolitics, a comparison of wage gains (blue line) versus inflation (red line) under President Trump and now Joe Biden.  But don’t sweat it, Joe – nothing that another creepy photo-op to an ice cream shop for fawning reporters won’t cure.

Biden’s Inflation Boom

From economist and friend Stephen Moore, the latest inconvenient truth:

South Dakota tops the list again at 2.9% unemployment – exactly the same as where it was 12 months ago. The only states with Democratic governors in the top 10 – Kansas and Wisconsin – had Republican legislatures and courts that blocked school closures and lockdown orders. And the same basket case lockdown states are at the bottom – California, New York, Hawaii – barely recovering still.”

Guess Which States Excel

The Biden Administration outrageously hopes to curtail American workers’ freedom by eliminating Right-to-Work states (currently 27), and the House of Representatives just passed legislation accordingly.  Preposterously, breathtakingly dishonest and dishonorable leftists like Rep. Tim Ryan (D – Ohio) make the Orwellian claim that doing so actually advances worker freedom.  That’s a lie, as economist Stephen Moore highlights.  But more broadly, American’s must understand what a threat this is to their jobs and our economic welfare more generally, before it’s too late:

Right-to-Work States Excel

In our latest Liberty Update, we highlight how a financial transaction tax and new market regulations would punish everyday American investors and retirees.   Yesterday witnessed significant movement on the issue, as CFIF joined a broad coalition of 27 organizations representing millions of Americans across the nation in urging Congress to reject any proposal to implement a financial transaction tax on Americans:

An FTT is the latest attempt by the left to take advantage of a ‘crisis’ to implement a massive new tax on the American people.  Contrary to their rhetoric, this tax would be borne by the American people, not Wall Street.  It would punish investment, leading to lower returns for American retirees and savers and increased market volatility.  It fails to raise as much revenue as supporters claim, and has failed everywhere it has been tried in past decades.”

Unfortunately, some in Congress nevertheless invite that potentially catastrophic risk.  Yesterday, Senator Chris Van Hollen (D – Maryland) advocated a financial transaction tax during a hearing before the Committee on Banking, Housing, and Urban Affairs.  Senator Van Hollen confirmed that Senators Elizabeth Warren (D – Massachusetts) and Brian Schatz (D – Hawaii) stand ready to introduce such legislation, falsely asserting that, “We know that Wall Street has made an art of high-frequency trading and rank speculation that’s fattened the wallets of a few, while putting everyday investors at greater risk.”

But as we noted specifically in our most recent piece on the matter, the exact opposite is true:

Any financial transaction tax will inevitably impact millions of Americans who rely upon investments to sustain their pensions, 401(k) plans, index funds and other retirement accounts.  Today, 53% of American households own stocks, while between 80 million and 100 million possess 401(k) accounts.  According to one recent analysis from the Modern Markets Initiative, the proposed financial transaction tax could mean a hit of $45,000 to $65,000 to 401(k) owners over the lifetime of their accounts.  Accordingly, the suggestion that a new tax on financial transactions won’t punish everyday Americans is flatly untrue.

In fact, the hardest-hit would be those who rely upon public sector employment pensions, such as police, firefighters, teachers and other public servants whose retirement accounts rely heavily on markets for retirement.  They stand to lose billions of dollars every year to the proposed tax, meaning significantly reduced savings and retirement incomes.”

Our broad coalition has it right, and Senators Van Hollen, Warren and Schatz have it wrong.  A financial transaction tax would sacrifice American consumer and investor wellbeing at the altar of a broader politically motivated agenda.

From our friend Dan Clifton, a nifty visual rebuke to leftists and Biden Administration officials pleading impoverishment and demanding a federal bailout of “blue” states.  Incoming tax revenues are actually up at the state and local level, and high-tax blue states would be better off engaging in tax reform and reduction for their own citizens instead of asking taxpayers in other states to bail them out:

No Blue State Tax Bailout Needed

We often highlight how Barack Obama didn’t end the 2008-09 recession or “prevent the next depression” (despite incessant uninformed assertion to the contrary), but instead captained the worst post-recession “recovery” in U.S. history.  As helpfully illustrated by economist Steve Moore, that just continues the longstanding record of leftist economic failure:

New Deal Debacle

As they say in the legal field, “res ipsa loquitur” – the fact speaks for itself.  From our friend and economist Stephen Moore’s blog:

“Red” States Outpace “Blue” States

From our friends at AEI, a wonderful capture of the difference between the Obama/Biden jobs “recovery,” which was the worst in recorded U.S. history (as the graph shows, they promised that unemployment wouldn’t surpass 8% under their wasteful spending “stimulus,” but instead it exceeded 8% for a record uninterrupted stretch), versus the sharp recovery under President Trump:

The Obama/Biden Jobs “Recovery”

The Trump Actual Jobs Recovery

From the U.S. Census Bureau, median household income rose by 6.8% in 2019 – a record one-year increase – to a record high of $68,700.  Notably, under the supposed racist President Donald Trump, those 2019 income gains were largest for minority groups.  And since 2016, median income has risen 9.7%, which is fantastic news for Americans, even if it might be bad news for leftists in their disinformation campaign:

Record Income Rise in 2019