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| Unleash Prosperity Hotline Issue #10 1. Art Laffer’s Inside Track to President Trump’s Economic Recovery This was the headline of a great piece by Susan Crabtree about our champion Arthur Laffer and his enduring influence on economic policy at the White House. Here is an excerpt: “It takes only five days of bad decisions to ruin a lifetime of success,” Laffer warned. “Calling helicopter money stimulus is like calling a nuclear bomb ‘the peacemaker.’” Laffer was referring to the current stimulus policy of trying to dump money into a struggling economy with the goal of preventing a deeper slump – what he considers a disaster that will undoubtedly slow any rebound, similar to what Presidents George W. Bush and Barack Obama engineered in 2008 and 2009. Laffer is pushing for a payroll tax holiday until the end of the year, which he says is a much simpler and far more cost-effective way to help jump-start the economy. “Every job has a payroll tax — every single one does — little businesses, big businesses, fat businesses, skinny businesses, tall ones, short ones,” he says. “What you want to make sure you do and make sure you don’t miss doing is to create an incentive structure to bounce back as quickly as possible. And that’s why I support the payroll tax [holiday]. Dollar for dollar, it’s the most efficient program there is around.” For more than half a century, Laffer has had the ear of several presidents and top policymakers, both Republicans and Democrats. He started out serving as chief economist in Richard Nixon’s Office of Management and Budget, working under then-Treasury Secretary George Shultz. Laffer and his supporters say the proof is in the pudding – the late 1980s were a time of great prosperity with low unemployment and economic growth rates higher than 6%. “Mr. Laffer is close to 80 and this is not his first rodeo,” Steve Moore, a longtime Washington supply-sider, said in an interview. “He’s lived through these many crises – massive inflation of the 1970s, stagflation of the early 1980s and helping steer the nation out of the crisis as Reagan’s chief economist. He’s advised presidents and very few of these others have.” In 2015, Laffer, Forbes, and Moore founded the Committee to Unleash Prosperity, a repository for supply-side news and analysis. Late last week, the group held a private conference call with GOP insiders to press their case that policymakers start giving the economic challenges posed by the coronavirus equal weight as the health concerns. Laffer and Moore led the call, with Forbes and GOP businessman John Catsimatidis making cameos. “Trump’s been, I think, a wonderful president, and just hope he doesn’t get misled,” he says. “And I’m going to do all I can to make sure he isn’t.” https://www.realclearpolitics.com/articles/2020/04/14/art_laffers_inside_track_to_trumps_economic_recovery_team__142939.html 2) An Express Train To More COVID Cases? We’ve written before about the insanity of proposals to include billions of dollars for the nation’s subway systems in COVID-19 legislation when it’s increasingly clear they are a germ-filled environment. Now Jeffrey Harris, a physician and MIT economics professor, has published a paper that finds “New York City’s multitentacled subway system was a major disseminator — if not the principal transmission vehicle — of coronavirus infection during the initial takeoff of the massive epidemic.” Harris notes that “close contact in subways is fully consistent with the spread of coronavirus, either by inhalable droplets or residual fomites left on railings, pivoted grab handles, and those smooth, metallic, vertical poles that everyone shares,” http://web.mit.edu/jeffrey/harris/HarrisJE_WP2_COVID19_NYC_13-Apr-2020.pdf One of the mysteries of the New York crisis has been why it has been so much more severe in the outer boroughs. The Harris paper offers an explanation: Manhattan subway ridership fell much more sharply – 65% – early in the spread.  It’s no surprise that Metropolitan Transit Authority chairman Pat Foye dismisses the good doctor’s findings as “flawed.” But it is curious that just yesterday, Foye’s boss, New York Governor Andrew Cuomo, announced that anyone now reading the city’s subways and buses would for the first time be required to wear a face mask. 3) Governor Whitmer Smears and Threatens Protestors Michigan State Police estimate that several thousand cars converged on the streets around the State Capitol building in Lansing, Michigan yesterday to protest Governor Gretchen Whitmer’s arbitrary lockdown restrictions. Under her edict, people are banned from buying seeds, gardening tools or paint. But alcohol, marijuana and state lottery tickets can be legally purchased.  https://nypost.com/2020/04/15/michigan-citizens-protest-over-coronavirus-stay-home-order But it’s not just people upset with shopping curbs who turned out for “Operation Gridlock.” Meshawn Madock, a rally organizer, complained to reporters that “The health-care system is basically shut down.” She said: “People with issues are having trouble seeing a doctor because everyone is focused on the virus. My husband and I are checking in on my in-laws, but even doing that is now breaking the law.” https://www.nytimes.com/aponline/2020/04/15/us/ap-us-virus-outbreak-michigan-protest.html Whitmer’s Whims have drawn the ire of four Michigan sheriffs who issued a joint statement accusing her of being vague and capricious. Leelanau County Sheriff Mike Borkovich complains people don’t understand why they can’t take a child fishing in a motorboat but they can use a kayak. “The economy is coming apart in northern Michigan. People are upset,” Borkovich told The Associated Press. “People are frantic to get back to work. They have been very edgy.” Whitmer has responded with a combination of smears and veiled threats. “People are flying the Confederate flag, and untold numbers who gassed up on the way here or grabbed a bite on the way home. We know that this rally endangered people,” she told reporters. “This kind of activity will put more people at risk and, sadly, it could prolong the amount of time we have to be in this posture.” Translation: If you don’t obey and keep quiet, your curfew may be in place for even longer. 4) Label every death coronavirus, get paid 20% more by Uncle Sam New York added 3,700 presumptive COVID-19 deaths – no test conducted – to their count yesterday. Why did they do it? Because the CDC said they could — and because Congress in its $2 trillion CARES Act wisdom added a 20 percent bonus to Medicare reimbursements for COVID-19 patients. It now literally pays to use the broadest possible definition. It seems to us that creating a monetary incentive for overreporting could be bad idea, especially when it distorts the data that the whole economy is being locked down over. 5) If Korea Can Vote Normally This Week, Why Can’t We In Seven Months? Democrats have been insisting that the COVID-19 emergency should force every state to fo vote-by-mail – a solution that a 2005 presidential commission led by former President Jimmy Carter and Secretary of State James Baker warned could lead to significant voter fraud. https://www.wsj.com/articles/heed-jimmy-carter-on-the-danger-of-mail-in-voting-11586557667 But South Korea has just proven it’s possible for a large democracy to conduct an election with in-person voting despite COVID. The nation of 52 million people just held elections for its 300-member legislative assembly. The voter turnout of 66 percent was the highest since 1992. People could vote early, but the vast majority showed up on Election Day. Masks were required, and the Wall Street Journal reported that people “waited in line at tape-marked spots spaced 3 feet apart. They had their temperature taken, rubbed sanitizer into their hands and slipped on pairs of disposable gloves. Those under self-quarantine were allowed to vote after the polls closed at 6 p.m.— though accompanied by a government chaperone.” https://www.wsj.com/articles/south-koreas-coronavirus-test-run-how-to-hold-an-election-11586948227 Sounds like those state election officials who being pressured by liberals to abandon in-person voting should consult with their South Korean counterparts, who seem to have done an exemplary job of keeping calm and allowing everyone to vote. 6) Anti-hero of the Day: Pennsylvania Governor Tom Wolf Wolf announced he will VETO a bill that would have required the governor to use CDC guidelines in determining which businesses can be open during the coronavirus scare. Wolf has ordered the shutdown of all Pa. businesses that aren’t what his administration terms “life sustaining.” He even idled construction projects. As a consequence one in six Pennsylanians are now unemployed, but the massive rise in joblessness hasn’t caused Wolf to budge. The Republicans put out a statement criticizing the governor. “Hardworking Pennsylvanians have participated faithfully in the shutdown and deserve to see the light at the end of the tunnel.” For now Pennsylvanians will remain in the dark.  |
