Author: sgstofka

The Chopping Block

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March 23, 2025

by Stephen Stofka

This is part of a series on centralized power. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

Abel put his coffee cup down on the table. “I don’t know where to start. Shortly after Trump was inaugurated, I said that the EPA would get cut (Source). Now Trump has announced that his recently confirmed head of the EPA will be cutting agency staff by 65%. This week Trump is signing an executive order to end the Department of Education (Source). He’s cutting staff by 50%. He fired the two Democrats on the Federal Trade Commission, an independent agency (Source). That violates a Supreme Court decision. He shut down three watchdog agencies in the Department of Homeland Security who monitor his immigration crackdown (Source). The Federal Reserve will be next. This reminds me of the guillotine during the French Revolution. That didn’t end well.”

Cain swallowed a bite of pancake. “He’s not going to fire governors on the Fed. He can’t, I don’t think.”

Abel scoffed. “Trump shoots first and leaves the details to others. The governors are appointed by the president and confirmed by the Senate just like the commissioners at the FTC that he just fired.”

Cain frowned. “The market would implode.”

Abel replied, “In his first term, Trump sought the market’s approval of his policies. In this second term, Trump has shown that he no longer cares what the market thinks.”

Cain shrugged. “On the campaign trail, he said he would clean up the swamp in Washington. He’s keeping a campaign promise. The majority of voters wanted this.”

Abel laughed. “Cutting staff by 50%? You think half of any government agency is ‘waste, fraud and abuse?’ Nah, this is the same radical disorder that marked the French Revolution.”

Cain shook his head. “Well, only Congress can end the Department of Education. Trump’s executive order simply outlines steps toward the end of the department.”

Abel raised his eyebrows. “You’re trying to normalize this? Nothing about this is normal or gradual.”

Cain sighed. “Look, the federal government is like a ship locked in ice. Nothing gets done in Washington any longer. There needed to be some drastic action to break free. You know, the department’s functions should never have been carved out of HEW, the Department of Health, Education and Welfare. In his run for President in 1976, Jimmy Carter promised the teacher’s union that he would make education a cabinet level agency in return for their endorsement. Even after he was elected, Carter slow walked the process for three years (Source). So, Carter signed the bill in October 1979. Ronald Reagan was running for President and promised to end the department if he became President (Source). Reagan and others thought it was unconstitutional, but he was never successful in ending it because the Democrats controlled the House during his two terms in office.”

Abel put his fork down. “So, you’re saying that Republicans have always challenged the legitimacy of the department.”

Cain nodded. “Yeah. There are three departments that have long been on the Republican hit list because they are outside the constitutional scope of the federal government. Education, Energy, and the EPA, the three ‘E’s. In 1977, Carter signed into law the creation of the Department of Energy to combine and coordinate several dozen programs in various agencies (Source). These are departments, as in cabinet level positions. Unlike Education and Energy, the EPA was not created by law, but by executive order. Not Johnson. Not Carter, or some big government-loving Democratic President. Nixon created the EPA shortly after signing an update to the Clean Air Act in 1970 (Source). Like Carter, Nixon wanted to combine a lot of programs into a single agency reporting to the President.”

Abel replied, “I often think of the 1930s as the era of big government. FDR created what was called an alphabet soup of agencies. You’re saying that Trump’s first target, though, is the second wave of federal government expansion in the 1960s and 1970s.”

Cain nodded. “That’s why I don’t think he will go after the Federal Reserve, which was created before FDR and the first expansion of government.”

Abel shook his head. “He’s trying to gut the IRS and that was created before FDR as well. I think you underestimate the anarchical instinct that motivates Trump and his cohorts.”

Cain shrugged. “Anarchy? Nah. Principled objection and longstanding grievance is not anarchy. Anyway, that second expansion was made possible by some key decisions by the Supreme Court during the first wave of federal expansion. The Tenth Amendment restricts the scope of the federal government and promotes federalism, the idea that a lot of power should be decentralized and under state control.”

Abel interrupted, “State governments are more responsive to the people. That kind of idea.”

Cain nodded. “Yeah, and the founders were suspicious of concentrated power. So, the FDR administration didn’t like the variety of worker protections in the states. No consistency. In 1938, FDR signed into law the Fair Labor Standards Act to make labor policy uniform throughout the nation. The law established a standard work week, a minimum wage, and overtime pay (Source).”

Abel interjected, “It’s good to have the same rules. Otherwise, it’s a race to the bottom as states try to get a competitive advantage by lowering standards.”

Cain smiled. “That’s some teleological reasoning you’re doing there. The ends justify the means.”

Abel argued, “The Constitution gives the federal government power to fix standards of money, weights and measures. A unit of labor is affected by the rules governing labor contracts. Setting uniform rules of commerce is like setting uniform measures used in commerce. Achieving uniformity in commerce is an implicit federal power granted by the Constitution.”

Cain rolled his eyes. “That’s stretching the definition of weights and measures, if you ask me. Anyway, some states complained that the act was an unconstitutional federal intrusion on state power. The government claimed that all labor policy had some effect on interstate commerce. The Constitution grants the federal government authority to control interstate commerce. That same year, a federal district court ruled that the act was unconstitutional in a case involving Darby Lumber Company. The case made it up to the Supreme Court which overturned the lower court’s  decision. Since Darby Lumber shipped some of their lumber out of state, that meant the company was involved in interstate commerce (Source).”

Abel replied, “Seems hard to argue with that. One state could lower their standards and give their manufacturers a competitive advantage offering lower prices.”

Cain nodded. “Yeah, sounds reasonable. But, consider a situation where a company exports less than 1% of its products out of state. The federal government was claiming authority over labor policy for a company’s entire operation because of any amount of interstate commerce, no matter how small.”

Abel frowned. “Ok, I see how that could be an intrusion on the state’s domain of legal authority.”

Cain replied, “And it got worse. In a 1942 decision Wickard v. Filburn, the Supreme Court decided that a farmer growing wheat for his own use was also involved in interstate commerce (Source). Yeah, you look puzzled. The court reasoned that the farmer’s consumption of his own wheat affected the interstate market for wheat.”

Abel laughed. “So, growing tomatoes in my backyard affects interstate commerce?”

Cain scoffed. “Apparently. That was the opinion of the Supreme Court.”

Abel nodded. “Ok, so the federal government expanded its scope under the Commerce Clause of the Constitution.”

Cain replied, “Way beyond the intentions of the framers. The whole idea of the Commerce Clause was to settle disputes over issues like water and road transportation, and anti-trade policies between the states. Instead, FDR wanted to undercut the legitimacy of state governments. He wanted to control everything.”

Abel asked, “Ok, so what is the beef against the Department of Energy? Natural gas lines cross state lines. Oil gets shipped from one state to a refinery in another state, then distributed out to states within a region. Plainly, it is interstate commerce.”

Cain shook his head. “The department was created in 1977 when the whole country was concerned about the price and supply of oil. Back then, a lot of policymakers and scientists believed in peak oil theory, first proposed in 1956 by geologist M. King Hubbert (Source). This was the idea that oil production would peak in the late 1960s and begin to decline thereafter. The crises of the 1970s seemed to confirm that prediction.”

Abel interrupted with a question. “What about fracking?”

Cain replied, “It had not been invented yet. At least, not an economical way. When the price of oil was high in the 1970s, the industry experimented with extracting oil from oil sands. When the price of oil started declining in the early 1980s, these developments were no longer profitable.”

Abel nodded. “Ok, back to what’s the beef with the Department of Energy?”

Cain sighed. “The purpose of the department was to develop nuclear energy to solve the problem of declining oil supplies (Source). Instead, the oil industry developed new drilling and exploration techniques, and America is now the leading producer of oil (Source). Anyway, a few years after the creation of the DOE came the nuclear accident at Three Mile Island (Source). Public sentiment turned against nuclear.”

Abel interrupted, “France gets over 70% of their electricity from nuclear (Source).”

Cain replied, “Yeah, but they have only a small amount of oil reserves compared to the U.S. That affects public sentiment. Anyway, the DOE has completely changed its mission in the past decades. Now they focus on developing green energy sources like wind and solar (Source). If there is no longer a shortage of oil reserves, there is no justification for the Department of Energy.”

Abel said, “Look, an energy crisis might have prompted the creation of the department, but it’s mission was always to develop a coordinated national energy policy. Initially, its focus was on nuclear energy. The department’s mission is broad. The oil industry just wants to get rid of a federal agency that supports the development of competing energy sources like solar and wind. Despite all its abundances, the federal government still gives over $20 billion a year in subsidies to the oil industry (Source). No matter how much they get, the industry wants more for them and less for their competition.”

Cain replied, “The federal government needs to get out of the energy business, including subsidies for the oil and gas industry.”

Abel frowned. “Fat chance. What about pollution, oil clean ups and nuclear waste disposal? If there is no longer an EPA, who takes care of oil spills like the 2010 Horizon accident?”

Cain replied, “FEMA would be the natural choice for emergencies of that sort. There are a lot of redundancies in the federal government.”

Abel shook his head. “Shifting responsibilities to another department may gain some slight efficiencies in the long run. In the short run, there is going to be a lot of knowledge lost, leaving us vulnerable to the next disaster. Each week, we learn of another stupid mistake that DOGE has made in their efforts to remake government. They are causing more harm and saving little money.”

Cain protested, “The federal government has become so bloated that it is crippling our ability to get anything done. The federal response to Hurricane Katrina was an embarrassment. Same with the Horizon oil spill, the delays and ineffectiveness of Obama’s Build America plan, the botched rollout of the Obamacare exchanges. Let’s not forget the high-speed rail line in California. Billions spent and no rail. Biden’s infrastructure bill that spent billions to get just a few electric charging stations built. This country used to be able to get stuff done. Now, everything gets snarled in red tape. Compared to China, we look like a declining empire. Turning that around will not be easy.”

Abel set his coffee cup on his plate. “Well, firing a bunch of government employees with vital expertise, and closing a few departments is not going to solve the problem. This administration will flail around when the next crisis comes. In the 2026 midterms, a small number of voters on the fence will cast their vote with the ‘other guys,’ the Democratic Party, and power will shift again. We have become a country of short-term thinkers. That’s why China will eventually gain the upper hand.”

Cain laid his napkin on the table and stood up. “This will take time, I grant you.”

Abel interrupted, “Yeah, Rome wasn’t built in a day, and I need to have faith and blah, blah, blah.”

Cain laughed. “No, I won’t give you that lecture again.”

Abel sighed. “I’ll see you next week. Maybe there will be another department on the chopping block.”

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Image by ChatGPT in response to the prompt “draw an image of a butcher block with a carving knife beside it”

A group of people show alarm as they slide down a slope

A Slippery Slope?

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March 16, 2025

by Stephen Stofka

This is part of a series on centralized power. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

In the park, Abel paused beneath an elm tree to study the new leaf buds emerging on the branches. He turned at the sound of Cain’s voice from the picnic table. Cain raised a seat cushion and motioned Abel over. Abel set the tray of two coffees on the concrete table inlaid with a chessboard. Abel said, “I didn’t know they had chess here.”

Cain frowned. “They used to provide sets, but the park office is closed. What do you have?”

Abel unslung his backpack, set it down and withdrew a white paper bag. “Burritos. This is a good idea, meeting outside on a nice spring day.”

Cain lifted a coffee from the cardboard tray. “Sugar?”

Abel nodded as he sat down. “In the bag. You know, we were talking about executive orders last week. You were comparing Trump and FDR. I was reading an article in Foreign Affairs this week called “The Path to American Authoritarianism” (Source – Levitsky and Way). They compare Trump’s strategies to autocrats around the world and they are similar.”

Cain pointed to his burrito. “Mild chili?” Abel nodded. Cain said, “I’m skeptical but go on.”

Abel continued, “Autocrats want to silence their critics, so they bring the media under control by hitting them with lawsuits. Trump has done that. Bezos and Zuckerberg have both settled lawsuits or the threat of lawsuits against the Washington Post and Facebook.”

Cain swallowed. “Trump sued both the Washington Post and the New York Times for defamation in March 2020 when he was running for re-election (Source – NPR). He sued ABC News in March 2024 when he was running for President again (Source – BBC). In office or out of office, the guy sues. It’s an election tactic.”

Abel replied, “Yeah, Trump has always kept lawyers busy, whether for him or against him. It’s just that between Election Day and Inauguration Day, when Trump took power, prominent media figures gave in.”

Cain shook his head. “I don’t think the White House has any more control of the media than it did when JFK was President. Here’s one example. To protect their access to the White House, the press kept JFK’s physical condition secret. Today, that would be a scandal. In that time, it was business as usual.”

Abel set his coffee cup down. “The authors of that article also talked about weaponizing the justice system to go after the political opposition.”

Cain shook his head. “FDR, JFK and Johnson weaponized the FBI. Is it OK when Democrats do it but not when Republicans do it?”

Abel shrugged. “You keep comparing the present to a time like sixty years or more in the past. The 60s and 70s introduced a lot of reforms to curb those abuses of earlier decades. Trump is undoing those reforms.”

Cain put his cup down on the concrete table. “Look, there are plenty of checks and balances in the system.”

Abel nodded. “Yeah, Levitsky and Way listed several. Let me think. There’s a small number of political appointees in the civil service. That’s one I can remember. The Senate has to confirm the heads of agencies. That’s another.”

Cain offered, “Lifetime tenure for judges?”

Abel replied, “Yeah, and staggered terms for independent agencies. Also, the military. Lots of laws to isolate the military chain of command from the political chain of command.”

Cain traced the rim of his cup with his forefinger. “So, a variety of boundaries that restrain a president.”

Abel shook his head. “But an autocrat systematically tries to break free of those restraints. He uses the tax system against his enemies. He rewards friendly businessmen and punishes unfriendly businesses.”

Cain interrupted, “You mean like Obama did favoring Solyndra? That was the solar panel company that got a lot of federal loans before it went bankrupt. Meanwhile, the Obama administration was imposing new regulatory burdens on the oil and gas industry (Source).

Abel frowned. “Solyndra’s business model did not account for the falling cost of making solar panels or the state support that panel manufacturers were being given in China. The Obama administration paid more attention to its own ideology rather than the economic and political facts. But that’s a common mistake. The financial crisis developed because policymakers like former Fed Chair Alan Greenspan was ‘blinded’ by his faith in the free market” (Source – video). People act based on their convictions.”

Cain shrugged. “Hmmm, good point. In fact, that’s a great argument for a minimum of regulation. Policymakers pay more attention to their ideologies when they make decisions. Or they favor their political friends. The Sackler family, the owners of Purdue Pharma, the makers of Oxycontin – they escaped responsibility for their actions for years (Source). They were generous contributors to both civic and political organizations. Policymakers on both sides of the aisle overlooked their role in the growing opioid crisis. Is that evidence of an authoritarian state or just plain old ‘machine’ politics?”

Abel replied, “I think the authors would say it’s a matter of degree. One or two examples of favoritism, or judicial prosecution does not indicate a slide into authoritarianism. It’s an accumulation of evidence. I guess its like in civil court cases. It’s a preponderance of the evidence.”

Cain argued, “But by then, when the evidence has accumulated, it’s too late. The autocrat has taken over the systems of government. Right? So many things in life are a matter of degree. ”

Abel nodded. “I guess you’re right. That’s why I often hear some version of the ‘slippery slope’ argument. Is the banning of the sale of bump stocks an abrogation of second amendment rights and a step on the road to tyranny or is it a reasonable response to the invention of digital printers?”

Cain crumpled his napkin. “It depends on my political bias or passion for a particular issue. People on the opposite side of an issue or the political aisle are more likely to see a single incident like bump stocks as a threat to individual freedom.”

Abel gave a short laugh. “It sounds like we are agreeing on something.”

Cain smiled. “I think I speak for a group that is naturally skeptical of the power of group thinking. A person might have what sounds like a good idea. Then it gets distorted. Take Darwin’s idea of evolution by natural selection. Policymakers here in America used that idea to justify eugenics. An earlier theory was Lamarckism, the idea that use or disuse of a part of the body was passed on to succeeding generations (Source). Policymakers justified taking American Indian children from their families and training them to be ‘civilized.’ They would then pass those traits on to their offspring.”

Abel looked up as a crow flew into the tree near them. “Yeah, Levitsky and Way stress how powerful a government is. There has to be checks on that power to protect people and businesses. The richest nations are capitalist because it’s an economic system that minimizes the role of government.”

Cain nodded. “I like that. Government needs to be smaller than it is.”

Abel replied, “That’s easy to say, but imagine you are trying to apply for Social Security or resolve some problem related to that. Some things have to be handled in person. Musk and DOGE are planning to close fifty Social Security offices (Source). So, you’ve worked a lifetime. You’ve paid taxes into the system, and you just want someone to handle the problem. How fair is that?”

Cain shrugged. “The way you put it, no, it’s not fair. Most people use computers or smartphones. A person with a problem could just start a chat with a Social Security representative. We need to design apps that make such interactions easy. Facial recognition, maybe some other biometric identification tools for security. Private institutions like banks have been closing branches as many people migrate to online banking. Government needs to do the same.”

Abel set his coffee cup down. “Last week you said that Americans accept the reality that politicians lie. As we said goodbye, you said I didn’t have enough faith in the American people. Those two sentiments contradict each other, if you ask me.”

Cain shook his head. “I didn’t mean that Americans are cynical. We guard our freedom. We’re more suspicious of power than European democracies, I think. We’re more feisty and non-conformist compared to European sensibilities. I think the Democratic Party has become more conformist in the past decade or so.”

Abel frowned. “Trump has taken over the Republican Party because they fall in line. They champion the ‘party over person’ idea. Even if you don’t like a politician personally, vote along party lines because a unified party is how policy gets enacted in this country. Trump could never take over the Democratic Party because it’s like herding cats. Like Trump, Obama was a charismatic leader, and he struggled to corral the diverse sentiments in the party.”

Cain nodded. “OK, good point. But no one is requiring people to vote Republican. The woke movement is all about conformity to certain language like the use of pronouns. Then they make policies that require students and employees to take the DEI classes. It’s indoctrination. That’s what Huxley warned about in Brave New World (Source).”

Abel scoffed. “In 1945, Sinatra made a short film denouncing racism that was called The House I Live In (Source – video). Was that DEI training or some mind control? No. It was in response to the prejudices when soldiers from different faiths and backgrounds came together to fight World War 2. This country is big. A lot of different people, races, religions. It’s about not putting up with bigotry and sexism when we encounter it on college campuses or some corporate headquarters in Manhattan.”

Cain argued, “As to diversity, there are a lot of factions in the Republican Party. Trump averaged about 40% approval ratings in his first term (Source). Why? Because the party is not conformist. There’s MAGA and traditional conservatives like Mitt Romney and the libertarian Rand Paul faction and the Freedom Caucus. Under Trump’s leadership, the party is now attracting more voters from the Democratic side. Republicans are against DEI because it’s forced indoctrination.”

Abel sighed as he closed the paper bag that had held their breakfast. “I look forward to these weekly talks because they challenge my viewpoint. I just don’t think we are going to get anywhere on this. DEI is about acting with some civility and responsibility, not some futuristic mind control.”

Cain smiled as he stood up. “It’s the slippery slope, isn’t it? Some see DEI as a step to an authoritarian government. Others see it as benign.”

Abel slid to the side on his bench seat. “Some see Trump’s actions as a path to autocracy. Some see it as a remedy for a bloated bureaucracy. Hey, at least we found some agreement this week. That’s a step forward.”

Cain laughed. “Is that one step on the road to total agreement? Hey, I’m glad we got together here in the park. I’ll see you next week.”

Abel waved. “Take care.”

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Image by Chat GPT in response to the prompt “draw an image of a group of people sliding down a slippery slope with alarm on their faces.”

Arbitrary Power

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March 9, 2025

by Stephen Stofka

This is part of a series of debates on centralized power. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

As Abel paused next to the restaurant booth, Cain bumped into him from behind. Cain asked, “What’s up?”

Abel said, “They still haven’t fixed the lump in the seat that was there last week.”

Cain shrugged. “I can sit there, if you like.”

Abel pointed to a booth in the corner. “Let’s try that one.”

As they slid into their seats, Cain joked, “I thought you didn’t like change.”

Abel smiled. “Many of us like consistency in our daily lives. I don’t understand how you and others want that in daily life, yet root for drastic change in government policy. Elon Musk with his chainsaw approach to downsizing government. Trump with his on again, off again tariffs.”

Cain nodded when the waitress stopped by with two glasses of water and a pot coffee. “Look, a President has to negotiate with his own government, with Congress, with foreign powers. Trump is using the tools available to him as the head of the executive branch.”

Abel raised his eyebrows as he sipped from his coffee cup. “Many of those ‘tools,’ as you call them, are probably illegal.”

Cain replied, “What’s legal and illegal is up the courts to decide. An executive has to act on a shorter time scale than the deliberate pace of the courts. Trump is a decisive executive.”

Abel interrupted, “Who changes his mind from day-to-day. Tariffs on, tariffs off. Erratic foreign policy with the European countries who are part of the NATO alliance. Building a luxury resort on the Gaza strip. It’s sheer lunacy.”

Cain looked up as the waitress stopped by, pen and ticket book in hand. “Number two for me, over medium, pancakes. Number five for him, scrambled…” He paused to look at Abel. “Pancakes, right?”

Abel nodded and said to the waitress. “My friend here is trying to be decisive today.”

Cain continued after the waitress moved on to serve another table. “Trump is trying to resolve tough issues that have gone unresolved for decades. NATO now has 32 countries (Source – U.N.), far more expansive in scope than after World War II when it was a defensive alliance of western European powers and the U.S. At that time, the U.S. had a deep interest in curbing military conflict that might lead to a nuclear third world war. Those days are gone. Same with the Gaza strip. Israel has occupied that since the Six Day War against Israel in 1967 (Source). How many solutions have been tried? As Shakespeare said, ‘Let me count the ways.””

Abel laughed. “Quoting Shakespeare like a scholar and ordering my breakfast like an executive all in one morning. Look, America is the oldest democracy because it has checks and balances that promote incremental policymaking. Change happens slowly. That frustrates people on both sides of the political aisle, but it provides a stability that the rest of the world admires and relies on. Trump is a bully, flexing his muscles to show how powerful he is. He is going to provoke a crisis then spend all his time blaming other people for the crisis.”

Cain shook his head. “I appreciate your point about stability, but our country is like a ship locked in Arctic ice. Too many policies and positions have been frozen for decades. Trump is trying to break free of these. Sure, there is going to be some breakage but its better than the status quo.”

Abel put down his fork. “The cure will be worse than the disease. Musk with his chainsaw approach to downsizing government. The defense department deleted 26,000 images with descriptive text that had the word ‘gay’ in it. In the process, they deleted images of the Enola Gay, the bomber that released the atomic bomb on Hiroshima.”

Cain equivocated. “Look I agree that a broad rule like that can have some embarrassing exceptions, but it’s several photos out of 26,000.”

Abel argued, “Computer algorithms are powerful tools but need to be deployed by people who understand the consequences of those algorithms. There is no adult supervision in the room. Musk is busy doing photo ops. Trump is busy signing pieces of paper his staff put in front of him. No one is supervising the whiz kids feeding algorithms into the government computers that pay seniors and veterans Social Security.”

Cain mopped up syrup on his plate with a finger. “There was plenty of human supervision on the rollout of the health exchanges under Obamacare. What was that? 2014? Jennifer Pahlka wrote about that disaster in her book ‘Recoding America’ (Source). A lot of the people working on that project didn’t have the skills or experience. What were they doing there? They knew the art of applying for a government job, if you ask me.”

Abel sighed. “You know Richard Dawkins, the evolutionary biologist? On his Substack The Poetry of Reality he objected to claims that sex is not binary (Source). He distinguished between sex, a biological reality determined by our gametes at conception, and gender, a language convention. Like which adjectives and pronouns to use with different nouns.”

Cain interjected, “I like that idea.”

Abel nodded. “Some groups blur the distinction between sexual identity, an innate characteristic, with gender identity, a socially constructed belief like religion. Government can’t impose religious rules on Americans. It shouldn’t impose rules regarding gender identity either.”

Cain replied, “Yeah, rules need to be based on objective facts.”

Abel replied, “So now we have a President who spouts imaginary facts that he wants to impose on the rest of us. It’s his subjective reality, just like a man who thinks he’s a woman. The objective reality is that the U.S. has spent $100 billion helping Ukraine (Source). Trump says it is $350 billion (Source). He wants everyone else to acknowledge his subjective sense of reality as a test of loyalty. Trans advocates want others to acknowledge a sexual identity that is fluid, not fixed at birth. That’s also a loyalty test, but to the ‘woke’ movement. Trump bad-mouths the woke movement but uses the same loyalty strategy as the woke movement. Because Trump is President, it’s a display of arbitrary power.”

Cain shook his head. “I don’t think Trump actually believes half of the facts that he says. It’s just rhetoric he uses in the political poker game.”

Abel replied, “So you admit he lies.”

Cain shrugged. “All politicians lie. The public is used to it.”

Abel objected, “But how does a person know if Trump believes his lie or is using it as a bargaining chip? It’s all subjective. No one can know what Trump believes. That’s what he wants. Reality is arbitrary. That’s what autocratic leaders like Putin, Xi, Hungary’s Orban and Venezuela’s Maduro do. They cut the connection with objective reality. Anyone who disagrees with them is just being political or disloyal.”

Cain tapped his plate once. “I keep hearing that Trump is an autocrat, destroying democracy. FDR issued over 3700 executive orders during three terms (Source). Trump issued 220 during his first term.”

Abel interrupted, “He’s issued 75 in just the first six weeks of his Presidency. At that pace, he would have about 600 orders in a year, 2400 in a four-year term.”

Cain argued, “FDR had 99 in his first 100 days.” (Source)

Abel disagreed, “Look, the country was in the middle of the Great Depression. Unemployment was 25% or so. People were desperate. A lot of those orders were FDR’s attempt to bring relief to a suffering public. There is no comparison with today.”

Cain said, “Trump’s trying to undo almost 100 years of the gigantic government movement that FDR started. It may take as many executive orders to undo that legacy as FDR signed.”

Abel shook his head. “After Trump has finished his coup and there are only the tattered shreds of our democracy left, his supporters will complain that they just wanted Trump to shake things up, not blow up the system. By then, it will be too late.” Abel slid out of his seat. “I’ll pick up the check. The public is going to get poorer as Trump and his cronies get richer.”

Cain looked up as Abel stood. “I have more faith in Americans than you do, I think.”

Abel raised his eyebrows as he looked to the street. “I hope you’re right, my friend. I’ll see you next week.”

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Image by ChatGPT in response to the prompt draw an image of a roulette wheel with the label “Reality” inscribed on it

The Battle of the Big Robots

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March 2, 2025

by Stephen Stofka

In this week’s conversation Abel and Cain discuss current events and two theories of international relations – realism and liberalism.

Abel looked out the window of the restaurant onto the busy street. He fidgeted on the bench seat in the booth opposite Cain.

Cain sensed his discomfort. “Is it too bright for you?”

Abel shook his head and shifted closer to the window. “No, there’s a bit of a lump in the bench seat cushion.” He gave a quick laugh. “A Trump lump. Trump’s transactional style is forcing European countries to shift their diplomatic positions.”

Cain took a sip from his coffee cup. “It’s about time that they shouldered some of the burden for their own defense. After World War II, America wanted a larger security role to avoid a large-scale military build up that led to the first two world wars. But that was 75 to 80 years ago. Trump is renegotiating those post-war agreements.”

Abel slipped a cube of ice into his coffee. “I never thought I would see the day when the US voted with Russia and North Korea and against most other countries in the U.N. Trump is building an autocracy the same way that Putin did in the early years of his reign.”

Cain shrugged. “The U.S. often stands alone in support of Israel in the U.N. This vote is not a slippery slope to autocracy. It’s a pragmatic vote. Trump does not want to aggravate Russia ahead of negotiations over a peace in Ukraine.”

Abel said. “There are too many principles being sacrificed to pragmatism if you ask me. The U.S. stands with Israel to recognize its democracy, its sovereignty and its right to exist. Russia and North Korea represent what George Bush once called an “axis of evil.” You say that Trump is placating the devil to better his bargaining position.”

Cain motioned for more coffee. “International relations is a system built on anarchy. Each country claims to be the final authority. It’s a high stakes poker game and sometimes countries have to bargain with their enemies.”

Abel thought for a moment. “It’s a dog-eat-dog world, you’re saying. That’s the realist approach to international relations. That analysis sees national states as big robots on the world stage. They are the primary actors, motivated by concerns about their own security, sovereignty, and interests. John Mearsheimer is the most widely read proponent of that type of analysis.”

Cain interrupted, “Yeah, that’s his name. In the early 1990s after the collapse of the Soviet Union, there were worries that terrorist groups might get a hold of Ukraine’s nuclear weapons. Ukraine transferred more than 2000 nuclear weapons to Russia and the U.S. helped dismantle Ukraine’s nuclear facilities (Source). It was Mearsheimer who said that Ukraine, being next door to Russia, should not give up its nuclear weapons. He got a lot of guff for that. Ukraine would be in a more advantageous bargaining position if they had kept their nuclear weapons.”

Abel nodded. “Maybe Mearsheimer’s perspective is the better analysis, but that perspective assumes that we are little more than lions and hyenas fighting over a kill on the African plains. Two world wars and a 45-year cold war have taught us that our ability to fight has become too destructive. We won’t survive as a species unless we cooperate. The nations of the world must build common ground based on social relationships, shared values and democratic institutions. Trump is upending that entire project.”

Cain shook his head. “You’re talking about liberalism, the theory that states are defined by geographical borders but operate within the constraints of their civilian institutions, you know, like shared norms, the right of the people to choose their own government.”

Abel nodded. “Yeah, and human rights. The importance of NGOs, non-governmental organizations like CARE, Feed the Children and Doctors Without Borders (Source).”

Cain interrupted, “It’s an aspirational theory but we are left with ugly truths about human nature, state actors and power. As Russia and China have gained in economic and political strength, they have reasserted their desire to increase their sphere of influence. Putin wants to rebuild the former Soviet Union. China wants control of Taiwan. They are building bases in the South China sea, creating conflict with the Philippines and Vietnam.”

Abel smiled. “So, this lump in my seat cushion is not Trump, it’s a cancer of the human spirit, huh? Geez, I hope we’re better than that or we’re doomed. Should we not try to build a world based on cooperation and compassion?”

Cain shrugged as he took a sip of coffee. “We can try but the ugly reality is that resources are not distributed evenly around the world. Russia has little access to open water during the winter. To Putin, the Crimea Peninsula in the Black Sea is vital to Russia’s security (Source). Russia, China, and Iran have deep memories of European aggression. The western powers can’t just say “oh, we’re going to be good now” and expect other countries to trust that rhetoric.”

Abel asked, “You’re saying that we can’t overcome the national memories of past conflicts? That we’re doomed to endless feuding like the Hatfields and McCoys? There is an underlying cynicism in that analysis that is just too pessimistic for me. Besides, consensus is so much more efficient than conflict.”

Cain frowned. “Talk about consensus. At the Munich Security Conference this month, J. D. Vance scolded those European nations that have been willing to sacrifice individual freedom for the sake of consensus (Source – video). A forced consensus is more of a characteristic of totalitarian governments.”

Abel shook his head in disgust. “Imagine if Macron or some other European leader came over here and started lecturing Americans on their policies regarding freedom of speech. J. D. Vance is the personification of American hubris. A pompous preacher. The satirist Stephen Fry remarked that freedom of speech is a step to justice and fairness, not an end in itself (Source, 2:40). Unlike Americans, the European protection of speech emphasizes freedom and responsibility (Source). Individuals have a responsibility to the group. It’s not a one-way street. But don’t look for the word ‘responsibility’ in the American Constitution. It’s not  there (Source). Maybe Americans could learn something about responsibility from Europeans on this topic.”

Cain scoffed. “Yeah, right, responsibility. How about Europeans being responsible for their own defense? Vance reminded them of that responsibility. The U.S. is $36 trillion in debt. American taxpayers can’t keep footing the bill for Europe’s defense so they can give European citizens generous social service programs. The French retire at 62! When the EU was forming thirty years ago, the defense target was 3% of each country’s GDP. Many of them haven’t even been spending 2% of GDP. The U.S. is spending almost 4% of GDP on defense. The European nations have not been doing their part. Free riders. They needed a good old swift kick in the can.”

Abel asked, “Do you think Trump wants to end NATO?”

Cain shrugged. “Who knows. He’s not in love with the organization. That’s for sure. The U.S. has other concerns, particularly in Asia. Ukraine was never in America’s security interest. Mearsheimer made that point after Russia took Crimea in 2014 (Source). Expanding NATO to include countries like Ukraine and Georgia just make Russia uncomfortable. The old saying is ‘don’t poke the bear.’”

Abel shook his head. “So, you agree with Trump that Ukraine started the war?”

Cain replied, “No, Trump’s brain is jumbled up with the last thing he heard on TV. But Ukraine could have stayed neutral instead of seeking a security alliance with NATO. Wake up, Ukraine! You’re next door to Russia and you have no nuclear weapons anymore. Stay neutral. Like I said, ‘don’t poke the bear.’”

Abel signaled for the check. “You’re depressing me.”

Cain laughed. “Hey, it’s not me. International relations is a study in power. Nation states are like big robots with national leaders pulling switches and levers inside the big machines.”

Abel smiled. “Reminds me of The Big O animation series (Source). Grim.”

Cain stood up. “I’ll catch the check and see you next week.”

Abel scootched to the outside of his seat. “Another eventful week, I’m sure. See you next week.”

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Image by ChatGPT in response to the prompt “draw an image of two big robots facing off against each other.”

The Magical Beast

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February 23, 2025

by Stephen Stofka

This is second in a series on centralized power. I decided to use a more conventional narrative rather than the debate format of previous posts. Research on this topic upset my “apple cart” of preconceptions regarding spending, taxes, and Republican support for some social programs. I survived.

Proponents of smaller government aim to restrain the growth of government spending by reducing tax revenue. In a 1981 Address to the Nation shortly after taking office, President Ronald Reagan first proposed the idea. If Congress would not cut back spending, then reducing tax revenues would force them to cut spending. As many political leaders did, Reagan assumed that the public would not tolerate the nation running large fiscal deficits. For most of the eight years he was in office, government spending stayed fairly constant at about 22% of GDP and the federal deficit remained at the same percent of GDP as during Jimmy Carter’s term. After 9-11, the public’s tolerance for deficits grew. The feckless Bush administration promised that Iraqi oil production would pay for the costs of invading the country. In 2003, the Republican Congress passed tax cuts and Bush won reelection despite the many failures of the Iraqi invasion. This time, he did so without the help of the conservative justices on the Supreme Court. It was the last time a Republican would win the popular vote until the election of Donald Trump in 2024.

A 2006 analysis by Christina and David Romer found little support for the Starve the Beast hypothesis and suggested that lowering taxes may, in fact, increase spending. In a 2006 paper, William Niskanen, former head of the Cato Institute, found that spending and tax revenues moved in opposite directions. One of the pathways for this phenomenon may be that taxpayers come to disconnect the two forces, taxes and spending, and don’t hold politicians responsible. For a politician, cutting taxes is a popular brand but they keep their seats by “bringing home the bacon” for their constituents. A farming community does not want to see decreases in crop subsidies or favorable tax breaks. Voters magnify the burden of spending cuts, feeling as though they are shouldering more of the burden than other voter groups.

In his second term, Donald Trump has adopted a different approach – kill the beast. Readers of William Golding’s Lord of the Flies will remember the scene where a mob mentality overtakes a group of shipwrecked boys and they start a feverish chant after a hunt, “Kill the pig, spill its blood.” The cuts that Musk and his DOGE team are making on the federal work force resemble less the precision of a surgeon and more the frantic swinging of a knife in the dark. They have targeted recent hires with few job protections and paid little attention to what those workers do. In their zeal to kill or wound the bloated government – the beast – they have laid off nuclear safety and food safety workers,  infectious disease specialists and IRS workers near the height of tax filing season. Both Musk and Trump are among the wealthy elite. Neither is dependent on a tax refund.

In his recently published book Why Nothing Works: Who Killed Progress—and How to Bring It Back, Marc J. Dunkelman recounts the expansion of the federal government, starting with the Progressive movement that began under Theodore Roosevelt’s administration over a hundred years ago. The movement embodies two instincts that are in constant tension, a “progressive schism” whose roots began when the nation was founded (pg. 22). Alexander Hamilton favored a strong central government whose institutions could facilitate the commerce and defense of the new American republic. Thomas Jefferson believed that the integrity and character of the new nation depended on the yeoman farmer, who must be protected from the power of government. Jefferson was horrified by the abuses of a strong British government headed by a monarch.

Progressives want to expand the reach of government – the Hamiltonian instinct – but are fearful of the power of government – the Jeffersonian instinct. The struggle between these two sentiments frustrates the aims of the Progressive movement. Progressives’ “cultural aversion to power renders government incompetent, and incompetent government undermines progressivism’s political appeal” (pg. 15).

For more than a century conservatives in both political parties have tried to check the ambitions of the progressives and the expansion of the federal government. For almost a century following the civil war, southern Democrats fought to preserve their political dominance and cultural institutions from the imposition of reformist norms by “northern elites.” There is still a strong antipathy to federal power but most of us have adapted to and enjoy federal institutions created by progressive legislation. Millions of Americans enjoy our national parks and monuments but over a century ago, local groups protested federal interference in the management of lands within state boundaries like Yellowstone Park, Glacier National Park and Grand Canyon National Park.

We no longer argue over child labor laws introduced by progressives in the early 20th century. Though popular today, conservative groups fought against the Social Security program when it was first introduced in the 1930s. Congressional Republicans, however, were largely unopposed, according to this 1966 interview with George Bigge. Opposition to “socialized medicine” stymied proponents of a Medicare type system first proposed in 1942. In the 1950s, President Eisenhower initially supported a health plan financed through the Social Security system but dropped his endorsement over objections that the program was a slippery slope to socialized medicine (Source). Wilbur Mills, the powerful Chairman of the House Ways and Means Committee, overcame Republican opposition to the Medicare program by introducing a Part B system for physician payments that would be voluntary. Many of us make an uneasy truce with federal power when those policies produce a net gain for our well-being, or there are limits to federal mandates.

This week, Donald Trump completed the first month of his second presidential term with a whirlwind of federal job cuts and controversial remarks. The first ninety days of a presidential term are said to be the honeymoon period when public opinion is still forming but recent polls by Quinnipiac University and CNN indicate that initial favorable sentiment has soured. More respondents disapprove of Trump’s policies than approve. Trump has promised to downsize both spending and taxes but preserve the Social Security and Medicare programs. Both programs are popular, as many voters feel that people have earned the benefits after a lifetime of paying taxes. The taxes, or dues, come first; the benefits come later.

There are no dues for the Medicaid program which provides health care insurance for low-income households. The federal government and states share the costs of this program in varying degrees, with the federal government picking up the majority of the costs. The Republican majority in the House has proposed $880 billion in cuts to the Medicaid program and Trump has expressed support for the cuts, surprising some Republican lawmakers and Trump’s own staff.

Trump acts with the impulsiveness of a 14-year-old boy. In an earlier age, the public wanted a stable hand in control of a vast nuclear arsenal. Thirty years after the end of the Cold War, voters seemed less concerned with Trump’s erratic behavior. Some excuse it as a negotiating ploy; others see it as a tactical maneuver. In Washington, where everyone has a “loaded weapon,” so to speak, Trump presents a moving target. Others see the policy moves as sheer incompetence. Over a thousand employees at the National Park Service were laid off and seasonal hiring was frozen (Source). Oops. Seasonal employees fight forest fires and clean bathrooms at National Parks. The Trump administration did an about face and promised to hire even more seasonal employees than the Biden administration did (Source). The daily two-step is a boon for news organizations and pundits. Lots of copy. Not a dull moment in the 24-hour news cycle.

Advocates may clamor for the death of the beast – the government – but many of the functions that the beast provides are popular. In 1963, the folk group Peter, Paul and Mary released the song Puff, the Magic Dragon. Although Puff was an eternal creature, his friend Jackie Paper eventually lost interest in Puff as he grew up. After his friend abandoned him, Puff lost all his vigor and retreated into his cave by the sea. Some wish that the federal government would do the same. Lobbyist Grover Norquist wished that government would become so small that “we can drown it in a bathtub” (Source). Unlike Jackie Paper, the majority of the public has not outgrown its affection for government programs or its belief in the magic of government power.

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Image by ChatGPT at the suggestion “draw a picture of a multi-colored dragon on the shore of the ocean with a cliff behind him.”

A Debate on Presidential Power

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February 16, 2025

by Stephen Stofka

This is part of a series on centralized power. This week’s debate is about the power of the President relative to the other branches of the federal government. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

Abel began the conversation. “Our country is founded on the principle of federalism, a sharing of power between the states and a centralized government in Washington. In that central authority are three branches that balance and check each other’s ambitions for power. It looks like Trump is challenging those restraints.”

Cain shrugged. “The Speaker of the House doesn’t seem worried. The Congress hasn’t been able to get anything done. It’s been almost thirty years since Congress completed a full budget (Source – pdf). The executive branch is stuck with the burden of implementing years of legislative compromises. It is entirely appropriate that the President clean up the mess.”

Abel shook his head in disbelief. “Trump is taking control of the purse, a power given to Congress by the Constitution. Doesn’t it worry you that a Democratic president could simply undo any laws passed by a Republican legislature?”

Cain looked puzzled. “If the President gets out of line, the Constitution gives Congress the power to impeach the President.”

Abel laughed. “Trump has already been impeached twice. Never in the history of this country has the Senate convicted a President. Impeachment is an empty threat. After the Supreme Court’s decision to grant the President immunity from criminal prosecution, the President can act like a king.”

Cain frowned. “FDR expanded the scope of the executive when he took office in 1933. Did your group sound the alarm then? Did you cry ‘Constitutional crisis’ when Roosevelt threatened to pack the Supreme Court to get his way? No, your group stood by silently as Roosevelt upended 150 years of tradition. This President is trying to undo that shameful legacy, to return this country to its founding roots.”

Abel showed his disdain. “He is undoing a century of building government institutions that help people, that protect people from the power of large corporations. This is not the America of the 18th century.”

Cain argued, “They are inefficient government institutions that swear allegiance not to the people they serve but Washington lobbyists and their own internal processes. We have a spending crisis. The Constitution gives the President the executive power. Alexander Hamilton argued for a strong executive and President Trump embodies Hamilton’s vision.”

Abel sighed. “You’re talking about the unitary executive theory. Advocates for that theory take Hamilton out of context. He wanted to convince those in the state legislatures that the strong executive in the proposed Constitution was preferred to the weak plural executive that had been defined in the Articles of Confederation. Hamilton was not advocating for a President with all the powers of a king. The country had fought seven bloody years to rid themselves of a king.”

Cain shook his head. “Look, Washington and Jefferson set the example. They were strong Presidents who sat at the top of the executive hierarchy. They didn’t ask Congress for permission. They defined their role as the chief executive of the laws.”

Abel interrupted. “Ok, but the executive branch was small in the early 19th century. Employees worked at the whim of the President. As the country grew, there needed to be more stability in the executive work force. Congress wanted more control or supervision of the various departments. After all, it is Congress who writes the laws. Congress represents the people. The President is the people’s agent, executing the laws that the representatives of the people have passed.”

Cain held up his hand. “Look, you’re describing a clerk, not the leader of a country. Hamilton was arguing for a leader with enough power to meet threats from other countries led by monarchs with absolute power.”

Abel argued, “That was another century when even the mightiest rulers had relatively little firepower at their command. We have invented weapons that are too destructive to put at any person’s command. There have to be checks and balances within the executive just as there are within the legislative and judicial branches.”

Cain shook his head. “The more destructive the weapons, the more we need a strong leader with the authority and power to act decisively to answer any threats from other countries.”

Abel frowned. “There has to be checks and balances within each branch. That’s especially true for the executive. All previous empires have fallen because one person gained too much power. Rome, Persia, Egypt, and Byzantium come to mind. There are too many temptations. A President with control of the Bureau of Labor Statistics would be able to adjust the monthly unemployment numbers or inflation report to make his administration look good. Argentina did this for seven years (Source). China, Venezuela and Hungary do it. He could disallow the counting of some of the population by the Census Bureau to reduce some grant funding for states who did not vote for him.

Cain scoffed. “There are checks and balances between Congress and the Executive. If a President were to ‘cook the books,’ that information would be leaked. The Congress could impeach the President.”

Abel’s expression was stern. “When the founders wrote the impeachment rules, they envisioned a system without political parties. In a party system, the President is the leader of the party. Impeachment is not a check. If the House is the same party as the President, they dare not bring their leader up on impeachment charges. A Democratic-led House would not impeach Andrew Jackson in 1833. All the anti-Jacksonian majority in the Senate could do was censure Jackson.”

 Cain argued, “In 1868, the Republican-led House impeached Andrew Johnson.”

Abel shook his head. “Johnson was a Democrat who ran with Lincoln on a third-party ticket called the Union Party (Source).”

Cain’s tone of voice was conceding. “Ok, maybe impeachment is not the ideal check on a President. But they pay attention to popular opinion. If the public is outraged, they will complain to their representatives. Presidents care about public opinion.”

Abel showed a wry smile. “George Bush’s poll numbers fell as low as 25% (Source). What did that accomplish? There is an entire phalanx of advisors who shield the President from disheartening news. A President lives in an information bubble designed to protect his self-confidence.”

Cain argued, “Well, there are no checks on the Supreme Court. They have lifetime tenure and the last one to be impeached was in 1805 (Source). They control their own agenda. The House and Senate make up their own rules (Source) and have no internal Constitutional checks. In the Senate, the Majority Leader controls all the floor time. If he doesn’t want some legislation brought to the floor, it isn’t considered. The President should have the same authority over officials in the executive branch. He should be able to direct them on how he wants the law executed. His decisions should not be subject to review by a court.”

Abel frowned. “You’re describing the unitary executive theory again. It grants the President most of the powers of a king. We know that Hamilton, Jefferson, Madison and the other founders did not want a king. This country rejected rule by the whim of one person, the king. We are a nation of laws, not whims. Trump and Musk are two rich crackpots who dance to the music of their own whims. The wolves in Russia and China are licking their chops. By the time Trump is done, this country will be weaker.”

Cain scoffed. “This country was already weak. That’s what the President is trying to fix. The country has $36 trillion dollars in debt. We’re spending more on interest than we do on defense. We play mister nice guy, letting other countries take advantage of our charity, then vote against our interests in the U.N. DOGE is going to trim the discretionary items in the budget then look to implement fraud controls in mandatory spending programs like Medicare and Medicaid. Trump has shown he’s a tough negotiator.”

Abel laughed. “Trump changes his mind from day to day, from week to week. It’s a sign of weakness that Putin and Xi will take advantage of.”

Cain shook his head. “The President dances like Muhammed Ali in the ring. That’s what we need. A fighter who keeps other countries hesitant to make any aggressive moves. That’s the road to a cautious peace.”

Abel sighed. “It’s only a few weeks since Trump took office. He will leave a trail of chaos and carnage and half of the people in this country won’t hold him responsible.”

Cain laughed. “And the other half of the country thinks he’s the devil. That says more about all of us than it does President Trump. We’ll talk next week.”

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Image by ChatGPT

The scene is set in a grand hall with tall columns, chandeliers, and intricate tapestries. A majestic king is seated on a grand throne, dressed in luxurious royal robes adorned with gold and jewels. Several people kneel before him in deep reverence, wearing medieval-style clothing.

The Carousel of Political Appointees

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February 9, 2025

by Stephen Stofka

This Super Bowl weekend, I’ll take a short break from the debate series and take a brief look at the Federal workforce. Next week I hope to have a debate on the Central Power of the Federal Government.

Since Donald Trump took the oath of office on January 20th, he has enlisted Elon Musk to head an effort to trim the civilian federal workforce (CFW). These employees do not include the men and women serving in the Armed Forces. Musk leads an unofficial department called the Department of Government Efficiency (DOGE) designated by President Trump to root out “waste, fraud and abuse.” Several lawsuits have challenged the authority and methods of DOGE to make personnel decisions. Several DOGE employees have access to personal credit and medical information but have not passed a background check (Source). This is a fluid situation sparking controversies each day. I wanted to understand the structure of the CFW as a context for this evolving story.

CFW employees fall into one of two categories: competitive service workers who must pass examinations to be hired and advance within the organization, and political appointees who are excepted from such requirements. The former are permanent or career employees and serve under several Presidential administrations regardless of the party of the President. This system promotes stability within a shifting political environment and was a response to the former system of patronage. The latter are temporary employees and leave the CFW when a new President takes office. Within each classification, there are several subcategories. For interested readers, I will list the various classes of employees in the notes.

Last summer the Partnership for Public Service published an analysis of 2023 data from the Office of Personnel and Management (OPM), the HR agency of the of the federal government (Source). There were over two million permanent full-time employees in the CFW, an increase of 140,000, or 7% from 2019 levels. OPM lists the current level of the CFW at 2.2 million (Source). The majority of the increase was in response to the Bipartisan Infrastructure Law passed in 2021, the first year of the Biden administration, when the Democrats held a “trifecta,” all three branches of government. The law benefited both red and blue states but has been criticized for the embarrassing flaws in its implementation.

The bill contained $42 billion to expand internet access, particularly to rural areas. Nothing has been connected yet. Over $7 billion was earmarked for electric vehicle charging stations but fewer than fifty have been built. To provide some comparison, consider the case of a Denver suburb that hired HDR, a private company, to complete a full renovation of a county library, expand the building and construct four charging stations (Source). HDR completed the project in three years, roughly the same time period since the passage of the 2021 law. Federal projects are plagued with a cumbersome process that makes delays inevitable and diminishes public confidence in the competence of the federal government. When President Trump and Elon Musk claim that they can fix the problem, their supporters believe them.

President Trump would like to undo much of what his predecessor, President Biden, accomplished. Trump could argue that he is simply resizing the CFW to pre-pandemic levels. According to the Partnership for Public Service, 71% of the CFW is defense or national security related. Twenty-one percent of federal employees are in the Department of Veterans Affairs (Source). Cuts to those programs will be unpopular with MAGA supporters and Republican lawmakers. Fifteen percent are medical personnel, some hired during the Covid crisis, and might become a target for dismissal. Many of those provide medical service to active military and veterans. USAID and the EPA have long been targets of Republican condemnation. Trump says he wants to close USAID. The EPA could be next. In response to several lawsuits, the courts will have to decide whether the executive branch has any authority to eliminate a department or agency created by Congress.

Excluding Postal Service workers, there are 2.2 million employees in the CFW (Source). Only 9000 are political appointees and listed in the OPM’s Plum Book (Source). President Trump wants to follow through on an executive order he signed just before the 2020 election that was rescinded by Biden (Source). That order envisioned a plan to convert 50,000 federal employees into a new type of political appointee called Schedule F that would be loyal to Trump’s policies (Source).  

In his first term, Trump became convinced that career civil service employees were sabotaging the policies of his administration. Political appointees carrying out the policies of then President Trump were frustrated by the delaying tactics of career employees who may not have agreed with those policies (Source). Many career employees have done their jobs for both Democratic and Republican administrations. They would claim that they are loyal to the law, not to any one President. Although Trump took an oath to uphold and faithfully execute the laws, his loyalty is to his opinion and vision, not the law. He follows the tradition of President Nixon, who believed that the three branches of government are not co-equal. Nixon regarded his interpretation of the law as the law.

The appointment system is bit complicated but is designed to balance power and interests. President Trump is used to running a family business and does not like checks and balances because they diminish his power. On the other hand, voters elected the President, and he should be able to have some confidence in the personnel who execute public policy. Career civil service employees are a welcome alternative to the patronage system that existed in the 19th and early part of the 20th century. However, a large class of employees with virtual tenure can become insulated from the public will. Those employees can develop a culture that is resistant to policy changes. Within the context of a CFW of more than two million employees, shifting the status of 50,000 employees can seem modest to some. Does the executive have the authority? Will the courts and Congress stand by while the executive alters a workforce structure constructed by Congress?

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Image by ChatGPT

The first type of position are presidential appointees with Senate confirmation (PAS). These positions promote a balance of power between Senators and the President.

The second type of position are Presidential appointees that do not need Senate confirmation. This gives the President the autonomy to build an executive team that will implement the policies he wants. These make up 5% of appointees.

The Senior Executive SES-NA and SES-GEN appointees make up half of the SES class and almost half of all 9000 appointees. The other half of SES employees are filled by career appointees on a competitive basis to ensure some impartiality.

The Schedule C (SC or SL) positions allow agency heads to place key policymakers with some expertise in an agency but only after approval by the Office of Personnel Management, a check on political discretion (Source).

The Schedule C (XS) statutory positions legislated by Congress strike a balance of Presidential discretion and Congressional policymaking. Most of these positions are in agencies with financial functions or international jurisdictions like USAID. They are GS-15 or lower and Congress has exempted them from competitive hiring (Source).

A Debate on Tariffs

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by Stephen Stofka

This is 12th in a series of debates on various issues. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

This week, Abel began the conversation. “Toward the end of our conversation last week, you mentioned the shift of voter sentiment toward the right.”

Cain nodded, “Yes, the New York Times analyzed the change in election results from the 2020 election and it showed a shift toward the Republican Party in most counties (Source – NY Times).”

Abel interrupted, “Voters shifted left in the 2020 election. For the past twenty years, sentiment seesaws left and right with each election. Voters are so evenly divided that a slight shift can have a dramatic effect on party control of government.”

Cain argued, “This time is different. The voters want change. The neoliberal wing of the Republican Party has been discredited and driven out after two failed wars and a permissive trade policy that boosted China’s economy at the expense of American jobs. Gary Gerstle (2022, pg. 2) writes that it was the financial crisis that triggered the fall of the neoliberal order. President Trump is trying to undo the mistakes of that neoliberal ideology.”

Abel frowned. “I’ve read that book. Gerstle also noted that neoliberal policies were responsible for a lowering of the barriers to free trade (pg. 5). Tariffs and borders, for example. Trump is on a mission to rebuild those barriers. That will only hurt trade and weaken American business and consumers.”

Cain shook his head. “Open borders allowed for the smuggling of drugs and people across our southern and northern borders. The costs of open borders outweigh the benefits.”

Abel sighed. “25% tariffs on imports from Mexico and Canada are going to fuel inflation and hurt consumers. Both countries have said they will retaliate. We export a lot of grains to Canada. That will hurt our farmers.”

Cain argued, “In 2002, President Bush raised tariffs on steel and aluminum imports to as much as 30%. A year later, after complaints to the WTO, Bush ended the tariffs. Trump is made of stronger stuff. These countries are not doing enough to curb drug and people smuggling. It may not be an explicit violation of trade rules, but it violates the spirit of those rules.”

Abel replied, “Bush did that to save jobs in the steel industry. Instead of stemming the flow of jobs to other countries, the tariffs caused the loss of 200,000 manufacturing jobs (Source). Trump’s tariffs are going to raise unemployment and cost consumers.”

Cain rolled his eyes. “We’re not going to agree on this. We have got to restore our nation’s manufacturing capacity and the supply chains that support production that is vital to our security. China controls a lot of essential minerals used in the production of electronics. They are actively pursuing alliances with African countries to lock up essential mineral resources. This is economic warfare, and we have to take measures to defend ourselves.”

Abel frowned. “Tariffs lead to trade wars. Trump is acting like he has a mandate. He won with the lowest margin of the popular vote in the past four decades – just 1.5%. He didn’t even get a majority of the votes (Source). In 2016, he got fewer votes than Hillary Clinton. Contrast that with Obama, who had a 7.2% margin of victory in 2008, and Biden who won by 4.5% in 2020. Voters for Trump are going to wake up and find that they have been screwed.”

Cain argued, “Democrats always use the popular vote as a measure of voter approval. States with a less concentrated population provide the resources that are vital to the economy and security of this country. Those states supply the food, the beef, the fuel that people in urban areas rely on. It’s an economic symbiosis. The producers and workers in rural areas should not be put at a disadvantage simply because their production requires more land. The Electoral College balances the inequities that result from a popular vote.”

Abel scratched his chin. “Tariffs are going to hurt the rural producers and workers that voted for Trump. Those red rural states already depend on the coastal blue states for federal benefits like farm and oil subsidies, Medicaid and welfare and they resent it. They imagine that Trump will revitalize rural economies so that they are more like it was in the 1950s when relative wages were higher. It was the unions who bargained for those higher wages and benefits. Without unions in the private sector, wages in rural counties will remain low.”

Cain raised an eyebrow. “Unions abused their power and companies became less competitive. Unions sometimes enforced rules among their members with violence or intimidation in the workplace (Source). They invite free riding. ‘Shirkers’ are paid at the same rate as productive employees. It’s bad for morale and makes workers less productive as a whole. An employee in a union has two bosses – the shop steward and the employer. The employer wants the employee to work at their best. The shop steward might want an employee to slow down so as not to raise the employer’s expectations.”

Abel cocked his head slightly. “Free riding is a collective action problem that is not unique to labor unions. They empowered workers in negotiations with large companies who wielded extraordinary power in the labor market. In some counties, a company was a monopsony, the main source of employment for everyone in that region.”

Cain argued, “The government is the largest employer in the country employing over 23 million at various levels (Source). Walmart, the largest private employer, has just over 2 million workers (Source). Unions have taken over the public sector.”

Abel interrupted. “Let me stop you there. The BLS just released their annual survey of union membership. It’s less than a third in the public sector (Source).”

Cain nodded. “OK, perhaps I overstated the percentage. Still, public sector membership is five times what it is in the private sector. Unions may give workers more bargaining power, higher wages and more benefits. Who pays for all that? Taxpayers. Our public schools are not teaching essential reading and math skills. Fewer police officers on the street. Potholes go unfilled. What are taxpayers getting for their money? Screwed.”

Abel scoffed. “Elementary school teachers generally make less than the average wage in their local economy. In Denver, an elementary school teacher averages almost $54,000 (Source). The average in private industry is more than $80,000 (Source).”

Cain argued, “Ok, so maybe elementary school teachers in Denver are underpaid. Their main funding source is local property taxes. In the whole metro area though, federal government employees make $2128 a week (Source). That’s far above the average weekly wage of $1721 in the private sector (Source).”

Abel shrugged a shoulder. “Look, Denver is a regional hub. There is a higher proportion of tech employees in the federal workforce in Denver than the private sector. State government employees make just $2 more than the average (Source).”

Cain frowned. “If the mix of jobs and talent was similar to the private sector, then their union is not very effective at negotiating pay.”

Abel showed some impatience. “Your group doesn’t like unions. I get that. Incorporation is a collaboration of capital for investor profits. A union is a collaboration of workers for better pay and working conditions. Capitalism has been so successful because it turns the free riding problem into an advantage.”

Cain laughed. “You’re saying something good about capitalism? Go on.”

Abel smiled. “Small investors, holders of common stock in a company, enjoy the same return on their capital as the giant hedge fund who may own a substantial stake in the company. Because they have so much at stake, large investors take an active role in monitoring or directing management decisions. The small investors freeride on those efforts.”

Cain nodded. “That’s an interesting perspective. I still don’t think that unions are needed to negotiate for workers. Worker productivity and demand will support higher wages.”

Abel sighed. “In theory. This is the real world, not a freshman class in economics. If capital can collaborate to gain bargaining power, workers must collaborate to match that power.”

Cain motioned his impatience. “We started out talking about tariffs and now we’re talking about unions.”

Abel laughed. “We are exploring different perspectives. We will never come to an agreement unless we try to understand each other’s positions on these issues.”

Cain nodded. “See you next week then.”   

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Gerstle, G. (2022). The rise and fall of the neoliberal order America and the world in the free market era. Oxford University Press.

The American Federation of Government Employees represents 800,000 of two million federal employees (Source). The American Federation of State, County and Municipal Employees represents more than 1.3 million workers (Source).

A Debate on a VAT tax

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January 26, 2025

by Stephen Stofka

This is 11th in a series of debates on various issues. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

The notes at the end give more context to the arguments.

Cain began this week’s conversation. “We left off last week discussing alternatives to the income tax. Before we entertain alternatives, can we agree that the income tax should be abolished at the same time the country adopts a new scheme of taxation?”

Abel cleared his throat. “I’m not so sure about that. Can an alternative tax scheme raise the same amount of revenue?”

Cain raised an eyebrow. “If it didn’t, that would be more money for private consumption and investment.”

Abel grimaced. “That’s playing with fire. The country is already running persistent deficits. If there was a significant difference in revenue, it could seriously weaken the dollar.”

Cain said, “Our group favors a consumption tax to replace the income tax. They were the main source of federal revenue until the passage of the 16th Amendment in 1913.”

Abel shook his head. “Consumption taxes didn’t raise enough money to pay off Civil War debts and the pensions promised to veterans and their families. In the early 20th century, society was becoming more complex. There was a greater role for government. The greatest improvements in health and life span came in those decades. Public sanitation measures and vaccines reduced water borne illnesses and contagious diseases.”

Cain argued, “I agree that there was a greater role for government. It’s just gone too far. Particularly the role of the federal government in our lives. A consumption tax broadens the tax base. Gives voters a stake in the government’s spending.”

Abel nodded. “There are several types of consumption tax. Many developed countries use a VAT or value added tax, but it is a supplemental to an income tax.”

Cain’s displeasure was obvious. “Our group would not support another tax. Also, with a VAT, politicians are tempted to fiddle with the type of items subject to the tax. It invites interest groups to lobby for exclusions from the tax. That’s what goes on in Britain and many European countries. We advocate a tax that reduces favoritism.”

Abel argued, “Any tax scheme invites favoritism. For instance, Colorado has a flat income tax but many exclusions from income that are not included in federal income. Pensions, social security and charitable contributions are just a few examples.”

Cain shook his head. “A credible alternative would have to make alteration as difficult as possible for Congress – just like the Constitution is.”

Abel sighed. “Specific language makes compromise difficult. The law is full of words that are open to interpretation like ‘reasonable’ and ‘appropriate.’ Section 8 of Article 1 of the Constitution stipulates that the Congress provide for the ‘common Defence and general Welfare.’ What does the word ‘general’ mean in that context? It’s clearly not the common welfare or the founders would not have agreed on the insertion of the word ‘general.’ To this day, our two groups have been arguing about the scope of powers authorized  by those two words.”

Cain tilted his head slightly. “Ok, granted it’s not easy. We are not striving for perfection, only clearly defined terms and transparency. No more backroom deals in Washington.”

Abel frowned. “Look, people and the institutions they create are too complicated for simple solutions. The only reason that the Constitution exists in a difficult to alter form is the small number of people who had a hand in its creation.”

Cain scoffed. “Each state had to ratify the Constitution and the Bill of Rights. In 1787, the Virginia legislature had 168 Senators and delegates. Today Virginia has only 140 members to represent a population that is sixteen times as large. Believe me, there was plenty of vociferous debate. The Constitution is a series of compromises hammered out in Philadelphia but reflecting the sentiments of those in the individual states.”

Abel interrupted, “The few who could vote. Men with property. The sentiments of the Declaration of Independence were noble and democratic, but this country’s Constitution was founded on governance by an aristocracy. After a bitterly fought Civil War, the passage of the 14th Amendment expressed the democratic sentiments that the founders could not embody in the original Constitution.”

Cain laughed. “Once again, we are getting off the topic. Our group wants specific, not broad, taxation powers that limit Congress and the President. It’s a principal-agent problem. We have to keep our elected representatives, our agents, on a short leash, or they will satisfy their own interests more than they do the people they represent. The text of the 16th Amendment was too broad and invited the corruption and complexity the tax code has become after more than a hundred years.”

Abel looked puzzled. “Your group wants an amendment with specific language?”

Cain nodded. “Yes, an amendment revoking the 16th Amendment and installing a consumption tax of some sort.”

Abel asked, “What about new home sales? They are included in GDP, but the consumption happens over years. The Bureau of Labor Statistics calculates an ‘imputed rent’ that a homeowner pays and collects each month. It’s based on market rents in that area.”

Cain shook his head. “It can be simple. The language of the amendment would target the revenue as a percentage of GDP. The means to get to that target would be left up to Congress.”

Abel looked interested. “Go on, tell me more about that.”

Cain continued, “Our group supports a national sales tax or VAT to replace the income tax. In 2023, the federal government collected $2.56 trillion in individual income taxes on a GDP of $27.2 trillion. That’s 9.2% of GDP. Let’s say a thirty-year average is 10% to make the math easy. A VAT or some other consumption tax rate could be adjusted each year based on quarterly GDP estimates that the government already does. That would not be cumbersome wording.”

Abel showed concern. “Your group strives for simplicity like it was the Holy Grail. In 2018, the Congressional Budget Office estimated the revenues from a VAT over a ten-year period. They noted that a broad tax base includes only 66% of personal consumption expenditures and those account for only 67% of GDP. Multiply those together and the tax base is only 44% of GDP. To collect the same revenue as individual income taxes, the tax rate would have to be 21% or so, not 10%.”

Cain counted on his fingers. “One, it would broaden the base so that more voters have skin in the game. Two, it would protect everyone’s privacy. Three, it would set clear and transparent limits on politicians in Washington. It’s well worth the price.”

Abel shook his head. “To abolish all tracking of income, all of the states would have to agree to a VAT to collect their taxes. What about Social Security taxes collected? For the past 15 years, those tax revenues have been 6.5% of GDP. The tax rate would have to be 36% to account for Social Security taxes. Add in state income taxes and the tax rate would be over 40%. Adding in state and local sales tax could bring the total tax bite to 50%.”

Cain argued, “Look at Britain. It has an income tax rate that starts at 20% and a VAT rate of 20%. A middle-income person could pay 60% total tax. The average effective tax rate in the U.S. is 15%. Add in 15% for the employer and employee contributions to FICA taxes. State and local taxes can add up to eight or ten percent. The total tax bite under our current system is close to 40%.”

Abel frowned. “An analysis of 2021 IRS data showed that the bottom 50% of taxpayers paid an average of only 3.3% of gross income, not 15%. Voters will not go for a tax scheme that will place a huge burden on most taxpayers to reduce the tax burden on Elon Musk and the other 1%.”

Cain interrupted. “That’s one of the problems. Half of the voters have so little skin in the game that they let politicians get away with anything. That’s how the budget became so bloated with ‘gimmes.’”

Abel replied, “Well, that’s a discussion for another day. I just don’t think a VAT is a practical alternative as a complete replacement for the individual income tax. Sure, we all like simple but the burden of common costs and the distribution of benefits is too complex for simple policies.”

Cain pursed his lip. “The more complex the policy, the less transparent. In a democracy, transparency is crucial.”

Abel raised an eyebrow. “I agree but I don’t think your group can sell a tax policy that would  increase the tax bite for the lower half of income earners by at least ten to fifteen percent. It might throw the economy into a recession within a year.”

Cain objected, “I think voters can be convinced. This last election has shown that voters are tired of progressive policies.”

Abel smirked. “Trump won the popular vote by 1.6%. The House has a slim majority. The Senate has a 53-seat majority only because Democrats had almost twice as many Senators up for re-election as Republicans. It’s the luck of the draw. It’s certainly not a mandate as Republicans are claiming.”

Cain shook his head. “A lot of traditionally Democratic voters went for Trump. Voter sentiment is shifting.”

Abel smiled. “That’s a discussion for another time.”

Cain turned to go. “See you next week.”

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Photo by Mary Farrell on Unsplash

The Tax Foundation explains the difference between a value-added-tax (VAT) and a national sales tax. https://taxfoundation.org/taxedu/glossary/value-added-tax-vat/  The European Union has a quick explainer on how a VAT works https://taxation-customs.ec.europa.eu/taxation/vat/how-does-vat-work_en

This Investopedia article explains several types of consumption tax. https://www.investopedia.com/terms/c/consumption-tax.asp

Abel brought up Colorado’s exclusions from income as an example of the favoritism that exists even in simple flat tax schemes. https://tax.colorado.gov/individual-income-tax-guidance-publications.

The effective tax rate is the tax divided by the adjusted gross income. On form 1040, it is line 24 divided by line 11. Popular tax software programs usually note the effective tax rate on their summary page.

Cain stressed the many legislative debates that ensued during the ratification process. This is a two-book set that contains the Federalist papers and arguments in several state legislatures. https://www.amazon.com/Debate-Constitution-Federalist-Anti-Federalist-Ratification/dp/1598534114/ref=sr_1_1

In response to Abel’s argument that the Constitution was a product of elite sentiments, Cain noted that there was far more representation of each district within a state than there is today. In 1787, the population of Virginia was 420,000 with the caveat that Negro slaves were counted as 3/5ths of a person. The actual population was about 532,000. Today the population is 8.7 million, sixteen times larger, yet the legislature is smaller. Counting Negroes as 3/5 of a person in the Constitution was a compromise about the amount of tax each state had to pay for the nation’s common expenses. Northern states wanted to share common expenses according to the population of each state. Southern states insisted that Negro slaves were property and should not be counted. Counting Negroes as 3/5 of a person was a compromise about money and the burden of taxation. https://csac.history.wisc.edu/2022/08/01/population-and-constitution-making-1774-1792/

Abel argued that a 21% VAT would be needed to replace individual income tax revenue. In 2023, individuals paid $2.56 trillion in income taxes. The CBO estimated that a VAT on a broad base of items would tax only two-thirds of personal consumption expenditures (FRED Series PCE) which was $18.8 trillion in 2023. 66% of $18.8 trillion equals a $12.4 trillion tax base. $2.56 trillion collected divided by a $12.4 trillion tax base equals a 20.6% tax rate. Here is a link to the CBO’s summary https://www.cbo.gov/budget-options/54820  

Taxes collected on Social Security is FRED Series https://fred.stlouisfed.org/seriesBeta/W780RC1Q027SBEA.

Cain compared a 50% tax bite with combined income tax rates and VAT rates in Britain. Income tax rates in Britain start at 20%. https://www.taxesforexpats.com/country-guides/uk/uk-vs-us-taxes.html#part1 The VAT rate is 20% https://taxfoundation.org/data/all/eu/value-added-tax-2024-vat-rates-europe/

A Debate on Income Taxes

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January 19, 2025

by Stephen Stofka

This is tenth in a series of debates on various issues. The debates are voiced by Abel, a Wilsonian with a faith that government can ameliorate social and economic injustices to improve society’s welfare, and Cain, who believes that individual autonomy, the free market and the price system promote the greatest good.

Unlike past weeks, Cain began the conversation. “Last week, we left off talking about taxes and the effect of taxes. First of all, I’d like to challenge your group’s support for the progressive income tax system.”

Abel interrupted, “Let me stop you there. If you want to talk about the progressive feature of the current tax system, fine. Neither you or I like the hodge-podge of policy goals and tax shelters that current tax law has become.”

Cain nodded. “That’s fair. Let’s keep our discussion confined to the progressive aspect where the more that a person earns, the higher the percentage of income tax the government takes.”

Abel sighed. “In principle, should every person pay the same percentage of federal income tax? Maybe. Fourteen states have a flat income tax rate. But practice and principle often conflict. Let’s use World War 2 is an example. Winning the war and defending the country was a benefit to every American. Who should pay the most? As a practical matter, the government needs to tap the pockets of the rich in greater proportion than the poor. That’s what the U.S. did for two decades after the end of that war.”

Cain tilted his head. “War is about the nation’s survival. That is the overriding principle that justifies some practical measures. Your group has used war funding as a justification for a progressive income tax since the 16th Amendment was ratified in 1913.”

Abel argued, “A nation’s sovereignty is even more important to rich people because they have more to protect, more to lose should the country be taken over by another nation. During peacetime, government institutions are devoted more to the haves than the have nots. The haves should pay proportionately more.”

Cain shook his head. “I don’t understand your reasoning. The majority of government agencies are dedicated to programs for the poor. In 2022, the federal government spent $592 billion on Medicaid. The states spent another $242 billion. That combined expense was 3% of our country’s entire output and almost as much as we spent on defense, the #1 priority of any country.”

Abel asked in an insistent voice, “Who benefits from all that spending? Investors in the stocks of the companies that supply products and services to the federal government. According to one analysis, investors in the stocks of defense contractors enjoy one of the highest risk adjusted returns of any industry. The government recycles tax dollars into the pockets of the better off. It’s only right that they should pay proportionately more taxes.”

Cain smiled. “The economist Paul Krugman recently posted a CBO graph showing that the effective tax rate on the top 1% is often more than 30%. An analysis of 2021 income tax data by the Tax Foundation showed that the top 1% paid almost half of all income taxes while the bottom half paid just 2.3%. That is nothing more than the government taking money from the most productive members of our country and giving it to the less productive.”

Abel scoffed. “During the Reagan revolution forty years ago, the top tax bracket was lowered from 70% to 28%. Since then, productivity growth has fallen by almost 20%. The data contradicts your favorite beliefs. Lower taxes on the rich does not promote increased investment. What are the rich doing with that extra tax money? Are they investing more in productivity enhancements? No. They are buying big mansions and more toys, spending that will promote stagnating economic growth and a more unequal society, a sick society.”

Cain shook his head. “You talk about ‘extra tax money’ as though the money belonged to the government. Income belongs to the people who earn it, not the government. If someone wants to buy a bigger yacht, that’s their business. Some politicians want to spend other people’s money on their favorite theory of social justice. In 1969, the poverty rate was 12.1%. In 2023, after trillions of dollars spent on means-tested social welfare programs, the poverty rate was 11.1%. The programs have benefitted bureaucrats more than the poor people they were meant to serve.”

Abel argued, “The percent of seniors in poverty is a third of what it was in 1969. The Medicare, Medicaid and other social welfare programs of the 1960s have dramatically improved the lives of the oldest generation.”

Cain replied, “Social Security has been the main contributor to the reduction in poverty among seniors. President Johnson’s Great Society programs to reduce poverty did have an effect in the first five to ten years. After that, the benefits have been negligible. Look, poverty has many causes. Cultural, economic, geographical, political, historical. Politicians can’t just throw money at a complex problem like poverty and expect sustained results.”

Abel nodded. “Understanding a complex problem requires a complex analysis. When economists consider the effect of tax, educational and social programs, they estimate a reduction in poverty of 33% .”

Cain sighed. “Let’s stay focused here on the progressivity of the income tax system. Before these programs were enacted into law in the mid 1960s, tax rates were extremely progressive. They were still strongly progressive for another twenty years. Minor changes in tax law had little effect on poverty during those years. The dramatic reductions in poverty during the 1960s can be attributed to those social programs and a change in the political and social culture. Those short-term benefits have been overwhelmed by the long-term ill effects on our families and our society.”

Abel asked, “Since that tax revolution in 1986, the government has had less revenue to pay for programs. Except for the Clinton years when taxes were raised on the rich, the deficits only get more persistent. Those with higher incomes have the money to support the programs and agencies that form a crucial financial support for many families.”

Cain interrupted, “Whatever those programs do, they don’t alleviate poverty. That’s what the Census Bureau data shows. A progressive income tax system mainly supports the huge political infrastructure in Washington. Congressional subcommittees and a plethora of executive agencies. The government takes more taxes from the rich and the rich fund think tanks and hire lobbyists to get some of that money back or construct the policies they favor.”

Abel shrugged. “So, what’s the answer? A flat percentage for rich and poor alike? That will have a much greater effect on consumption for families in the bottom half of incomes. Is that fair? What should be the measure? The percentage of the tax or the percentage of misery that the tax has on a family?”

Cain smiled. “What’s the alternative? That’s a discussion for another week, I think.”

Abel returned the smile and waved goodbye. “See you next week.”

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The Peter G. Peterson Foundation has an analysis of the federal government’s budget here. https://www.pgpf.org/article/budget-explainer-medicaid/ . Combined state and federal expense was $834 billion, 3% of the $26,006 billion in GDP https://fred.stlouisfed.org/series/GDP Defense spending and investment was $930 billion https://fred.stlouisfed.org/series/FDEFX

FRED Chart on productivity https://fred.stlouisfed.org/series/OPHNFB In the period 1948 – 1984, productivity growth averaged 2.35% per year. Since 1985, it has averaged 1.93%, a reduction of 18%.

Census Bureau tables on poverty from 1959-2023. https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-poverty-people.html Table 3 contains data on people by age. From 1969 to 2023, the poverty rate for seniors fell from 25% to less than 10%. For those aged 18 to 64, the poverty rate has actually risen from 8.7% to 10%.

This 2011 NBER article summarizes a paper by economists Gary Englehardt and Jonathan Gruber analyzing the reduction in poverty among seniors in the 20th century. https://www.nber.org/bah/2004number2/social-security-and-elderly-poverty

This Washington Post article examines the long-term effects of the Great Society programs. This section is the war on poverty. https://www.washingtonpost.com/wp-srv/special/national/great-society-at-50/#war-on-poverty A more conservative outlook on the social and moral effects of those programs can be found at https://hc.edu/news-and-events/2017/02/28/great-society-wrought-fifty-years-later-marriage-family-poverty/