Sunday, March 22, 2009

Cato Institute $24.95, 695 pages

In the introduction to the “Cato Handbook for Policymakers,” Cato libertarian executive vice president David Boaz hails the breakage of another glass ceiling in the election of President Obama. But neither President Obama nor his immediate predecessor, President Bush, are spared from censure here for engaging in entrenched state interventionism in a plethora of formats. Nor, for that matter, are previous presidents and Congresses lured by political power.

Mr. Boaz reminds his readers that Cato stands firmly on the principles of the Declaration of Independence and the Constitution, “on the bedrock American values of individual liberty, limited government, free markets, and peace.” He rejects the idea of “convergence” of some sort of half-capitalist, half-socialist Third Way model as a wave of the future. He invites comparison of the two systems involved in East and West Germany, North and South Korea, Hong Kong-Taiwan and China, and the United States and the Soviet Union.

This long, lively, documented book on libertarianism has some 70 authors in 63 chapters under 10 headings: Restructuring the Federal Government, Government Reform, Health Care and Entitlement Reform, Cutting Federal Departments and Programs, Threats to Civil Liberties, Regulation, Tax Policy, Energy and Environment, Foreign and Defense Policy, and International Economic Policy.

Cato’s director of tax policy studies, Chris Edwards, says that Congress should cut federal spending from 21 percent to 16 percent of gross domestic product over 10 years, that it should end, privatize or transfer to the states more than 100 programs and agencies, including those in agriculture, education, housing and transportation. He also recommends that it should reform Social Security by cutting the growth in benefits and adding a system of private accounts, that it should cut Medicare spending growth and move to a health care system based on individual savings and choice.

On privatization, Mr. Edwards says that Congress should end subsidies to passenger rail and privatize Amtrak, which would permit the firm to innovate, invest and terminate unprofitable routes, that it should privatize the U.S. Postal Service and repeal restrictions on competitive mail delivery, that it should privatize the air-traffic-control system and help privatize the nation’s airports, while ending federal susidies and that it should privatize federal electric utilities, including T.V.A. and the Power Marketing Administrations.

On federal tax reform, Mr. Edwards recommends that Congress should cut the federal corporate income tax rate from 35 prcent to 15 percent, replace business depreciation with capital expensing, switch the individual income tax to a consumption-based flat tax at 15 percent, and repeal the estate tax. Amen.

Cato chairman-scholar Robert A. Levy invokes Alan Greenspan’s cut in 1966 that antitrust is a “jumble of economic irrationality and ignorance.” Mr. Levy holds that Congress should repeal the Sherman Act of 1890, the Clayton Act and the Federal Trade Commission Act both of 1914, plus the rest of the antitrust system. Mr. Levy sees antitrust as sapping the idea of private property, as based on a static view of the market, as bad economcs, bad public policy.

Cato senior fellow Patrick J. Michaels, who is also professor of environmental sciences at the University of Virginia, asks Congress not to restrict emissions of carbon dioxide, but to repeal current ethanol mandates. He asserts that there is no scientific credible model for future warming, despite media alarmists on global warming, rising seas and more hurricanes. Mr. Michaels warns against “cap-and-trade” emission permits as costly and unproven.

Cato’s libertarian scholars go after our 2009 $700-plus billion defense budget. They say policymakers should adopt a grand strategy of restraint, meaning avoiding state-building missions and eliminating most U.S. defense alliances. They ask policymakers to redeploy troops in Iraq, South Korea, Europe, and Japan to the U.S., to cut back from a projected army of 48 brigades to 25 to 30 brigades, to avoid “conflicts that are not ours.” Amen again.

So it goes in this remarkable collection of libertarian thinkers who cover the entire policy waterfront. For example, they would quit the so-called War on Drugs, repealing the Controlled Substances Act of 1970 and shutting down the Drug Enforcement Administration. They would also cancel both the National Endowment for the Arts and the National Endowment for the Humanities, and defund the Corporation for Public Broadcasting.

State interventionists, take cover.

William H. Peterson is an adjunct scholar with the Ludwig von Mises Institute of Auburn, Ala.

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