Thursday, December 20, 2012

December 20, 2012

America's Dangerous Powerball Economy
by Arthur Brooks
December 19, 2012

What can the state lottery teach us about how to deal with the fiscal cliff? Quite a bit, actually.

Last month, two families in Missouri and Arizona had their dreams come true when they shared the largest Powerball lottery jackpot in history: $587 million. "We are truly blessed," one of the winners told the press.

Perhaps. People always imagine all the nice things that would happen to them if they won the lottery: They would travel more, buy a beautiful home, start a foundation or quit a tiresome job. Rarely do people say, "If I won the lottery, I'd marry somebody who doesn't love me, buy a bunch of things I don't really want, and then start an ugly alcoholic spiral."

But hitting the jackpot generally leads to unhappiness. A famous 1978 study of major lottery winners in the Journal of Personality and Social Psychology showed that while the winners experienced an immediate happiness boost right after winning, it didn't last. Within a few months, their happiness levels receded to where they had been before winning. As time passed, they found they were actually less happy than they had been before winning.

Does this suggest that money makes us unhappy? Not at all. There is a huge amount of research showing that money, when earned, has a generally positive association with happiness. The problem is when it is unearned, when raw purchasing power is untethered from hard work and merit. Above basic subsistence, happiness comes not from money per se, but from the value creation it is rewarding.

The University of Chicago's General Social Survey reveals that people are twice as likely to feel "very happy" about their lives if they feel "very successful" or "completely successful" at work, rather than "somewhat successful." The differences persist whether they earn more or less income.

Entrepreneurs of all types rate their well-being higher than do members of all other professional groups in America, according to years of polling by the Gallup organization. And it's not because of the money. The employment website reported in 2011 that small business owners made 19% less per year than government managers.

While earned success facilitates the pursuit of happiness, unearned transfers generally impede it. According to the Panel Study of Income Dynamics, going on the welfare rolls increases by 16% the likelihood of a person saying he or she has felt inconsolably sad over the past month (even after controlling for poverty and unemployment). A study by economist John Ifcher at Santa Clara University shows that single mothers who were required by the 1990s welfare reform to work for their benefits—and therefore lost leisure time, had to find child care and the like—were still significantly happier about their lives after the reforms than before.

All this data relates to our policy debates because every year, fewer and fewer people earn their way in America without a government subsidy. As my colleague Nicholas Eberstadt has written, entitlements have doubled as a percentage of the ballooning federal budget since 1960. Today, more than half of American households receive government transfer benefits.

And this isn't just a case of senior citizens taking the Social Security they have paid for. Unearned transfers are exploding. Consider that the number of Americans receiving disability benefits has increased almost 20-fold since 1960, to 8.6 million today from 455,000. The Tax Foundation notes that nearly 70% of Americans now take more out of the tax system than they pay into it.

It is a simple fact that the United States is becoming an entitlement state. The problem with this is not just that it is bankrupting the country. It is that the entitlement state is impoverishing the lives of the growing millions dependent on unearned resources. The good news is that we have a golden opportunity to rein in entitlements, for the first time in many years.

But there is bad news, too. President Obama argues that the real problem is undertaxing the public, not overspending on entitlements. He is currently asking Congress for $1.3 trillion in tax increases over a decade but less than $1 trillion in spending cuts—largely deferred, meaning much of that may not even take place. A study by Ernst & Young shows that Mr. Obama's proposed tax hikes would force small businesses to eliminate about 710,000 jobs.

Mr. Obama's proposal suggests he is entirely comfortable with an entitlement state. His telling entrepreneurs that they weren't responsible for their success on the specious grounds that government was responsible for the country's infrastructure—"You didn't build that"—wasn't just an inartful turn of phrase. It implied he is blind to the moral difference between what is earned and what is unearned.

Before us today is a chance to improve the true welfare of our nation while changing our overspending ways. By reforming entitlements and the tax system instead of extracting more money with higher tax rates, the economy could be reoriented away from unearned transfers to earned wages. This would make the economy fairer and sounder. And in the process it could build a happier country for ourselves and our children.

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A Crack in Obama's Armor?
by Matt C. Abbott
December 20, 2012
Just when you're about to give up entirely on the federal courts, a small sign of hope emerges.

From The Becket Fund for Religious Liberty:

Today [Dec. 18], a federal appeals court in Washington, D.C. handed Wheaton College and Belmont Abbey College a major victory in their challenges to the HHS mandate. Last summer, two lower courts had dismissed the Colleges' cases as premature. Today, the appellate court reinstated those cases, and ordered the Obama Administration to report back every 60 days-starting in mid-February-until the Administration makes good on its promise to issue a new rule that protects the Colleges' religious freedom. The new rule must be issued by March 31, 2013.... 
'This is a win not just for Belmont Abbey and Wheaton, but for all religious non-profits challenging the mandate,' said [Kyle Duncan, general counsel of The Becket Fund for Religious Liberty]. 'The government has now been forced to promise that it will never enforce the current mandate against religious employers like Wheaton and Belmont Abbey and a federal appellate court will hold the government to its word.'

A win? Perhaps. Still, I think it's a bit premature to declare victory. One can hope that these legal challenges to the HHS mandate are making the Obama administration sweat a little, so to speak. Or maybe the president will actually have a pang of conscience. After all, the least he can do is allow for authentic religious freedom here in the United States of America.

As Pope Benedict XVI recently stated, religious freedom is a fundamental human right. (Granted, I'm not holding my breath that the president will embrace the pope's wisdom.) In his message for the 46th World Day of Peace on Dec. 14, the pope said:

'One of the fundamental human rights, also with reference to international peace, is the right of individuals and communities to religious freedom. 
'At this stage in history, it is becoming increasingly important to promote this right not only from the negative point of view, as freedom from-for example, obligations or limitations involving the freedom to choose one's religion-but also from the positive point of view, in its various expressions, as freedom for-for example, bearing witness to one's religion, making its teachings known, engaging in activities in the educational, benevolent and charitable fields which permit the practice of religious precepts, and existing and acting as social bodies structured in accordance with the proper doctrinal principles and institutional ends of each. 
'Sadly, even in countries of long-standing Christian tradition, instances of religious intolerance are becoming more numerous, especially in relation to Christianity and those who simply wear identifying signs of their religion.'
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The New Racial-Derangement Syndrome
by Victor Davis Hanson 
December 20, 2012

There is a different sort of racialist derangement spreading in the country — and it is getting ugly.

Here is actor Jamie Foxx joking recently about his new movie role: “I kill all the white people in the movie. How great is that?” Reverse white and black in the relevant ways and even a comedian would hear national outrage. Instead, his hip Saturday Night Live audience even gave Foxx applause.

Race-obsessed comedian Chris Rock tweeted on the Fourth of July, “Happy white peoples [sic] independence day . . . ”

Actor Samuel L. Jackson, in a recent interview, sounded about as unapologetically reactionary as you can get: “I voted for Barack because he was black. . . . I hope Obama gets scary in the next four years.”
No one in Hollywood used to be more admired than Morgan Freeman, who once lectured interviewers on the need to transcend race. Not now, in the new age of racial regression. Freeman has accused Obama critics and the Tea Party of being racists. He went on to editorialize on Obama’s racial bloodlines: “Barack had a mama, and she was white . . . very white, American, Kansas, middle of America . . . America’s first black president hasn’t arisen yet.”

Freeman’s racial-purity obsessions were echoed on the CNN website, where an ad for the network’s recent special report on race included a crude quote from three teen poets: “Black enough to be a n. White enough to be a good one.”

In the 21st century, are we returning to the racial labyrinth of the 19th-century Old Confederacy, when we measured our supposed racial DNA to the nth degree? Apparently, yes. ESPN sports commentator Rob Parker blasted Washington Redskins quarterback Robert Griffin III last week for admirably stating that he did not wish to be defined by his race rather than by his character: “He’s black, he does his thing, but he’s not really down with the cause.” Parker added: “He’s not one of us. He’s kind of black, but he’s not really like the kind of guy you really want to hang out with.” (ESPN suspended Parker for his remarks.)

Unfortunately, the new racialist derangement is not confined to sports and entertainment. The Reverend Joseph Lowery — who gave the benediction at President Obama’s first inauguration — sounded as venomous as the Reverend Jeremiah Wright in a speech that Lowery delivered to a black congregation shortly before this year’s election: “I don’t know what kind of a n***** wouldn’t vote with a black man running.” Lowery reportedly preceded that rant by stating that when he was younger, he believed that all whites were going to hell, but now he merely believes that most of them are. And in his 2009 inauguration prayer, Lowery ended with his hopes for a future day when “white will embrace what is right.”

Wasn’t Obama’s election supposed to mark a new post-racial era? What happened?

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