Millennials are inheriting a bleak fiscal future. Not only is America $18 trillion in debt, but when future spending obligations on entitlements are compared with future tax obligations, the so-called fiscal gap is $205 trillion. This is 12 times GDP and 16 times official debt held by the public.
Paying off the federal fiscal gap would require an immediate increase of 57 percent in all federal taxes, or cuts of 37 percent in all federal spending except interest payments on the debt. Of course, no one is proposing this. Instead, the debt grows from year to year, gradually stifling productive investment.
How can we change Washington’s direction in order to paint a brighter future for America’s next generation?
Perhaps the easiest way to begin digging out of this debt is regulatory reform, which would spur substantial economic growth. America’s regulatory state has expanded steadily since the 1970s. In 1975, the Code of Federal Regulations was 71,224 pages. By 2013, the number of pages had grown to more than 175,000. The sheer quantity of government red tape makes it impossible for ordinary Americans to know whether they are breaking the law while working to start or maintain a business.
Read the rest at Forbes.
On Monday, President Obama announced new restrictions on federal transfers of paramilitary gear to local police departments. Effective immediately, federal bureaus like DOD and DHS can no longer provide local police tracked armored vehicles, grenade launchers, and bayonets. Other items like explosives and riot gear will continue to be made available but with stricter federal scrutiny.
While this is certainly a step in the right direction towards demilitarizing America’s increasingly aggressive police force, civil libertarians should not celebrate prematurely. As NPR pointed out yesterday, Obama’s reforms do not apply to the vast majority of paramilitary transfers:
— The distribution of firearms .50-caliber or higher is now banned. But the 1033 program didn’t distribute a single such weapon to local authorities during the time period.
— All 84,258 rifles — including assault types such as M16s and battle types such as M14s — that were distributed to police departments would still be made available to local agencies. These rifles fall below the .50-caliber threshold.
— “Tracked armored vehicles” are now banned. But very few of 1033’s mine-resistant, ambush-protected vehicles (or MRAPs) distributed to local agencies had tracks. In fact, nearly 87 percent of them have wheels.
— The new rules also prohibit “weaponized aircraft.” But of the aircraft listed in the data, none was specifically listed as having weapons. Ninety-seven percent of helicopters were listed as utility, observation, trainer, medevac or search and rescue — the other 3 percent were simply listed as “aircraft, rotary wing.”
While a lot of questions are up in the air as to the scale of the reforms, Radley Balko points out that they will likely reap positive results regardless: “We’ll either get less use of this military-issued equipment, or we’ll get more and better information about how it’s used. Either outcome is progress.” Nevertheless, much more reforms will undoubtedly be needed until the country can redraw a clear line of separation between cop and soldier.
Reprinted with permission from Rare.
In a near-unanimous vote, the Los Angeles City Council has decided to increase the city’s minimum wage from $9 to $15 an hour, a 67 percent change to be phased in over the next five years. Once a measure can be formalized, Mayor Eric Garcetti promises to sign it into law. But if Los Angeles insists on raising the minimum wage, it should exempt workers 22 and younger. Otherwise, the higher minimum will price teens and students out of jobs and prevent them from getting valuable work experience.
Some argue that Los Angeles can easily absorb this increase, because compensation levels in the city are relatively high. According to the Bureau of Labor Statistics, the median hourly wage for the Los Angeles-Long Beach-Glendale metro area was $18.32 in 2014. But the presence of many high-paying professions masks the destructive effects the new minimum wage will have on industries that offer entry-level positions. Median wages for local dishwashers, bar backs, ticket takers, and fast-food workers run between $9.00 and $9.10. It’s naïve to assume that all these positions will survive the increase. Businesses don’t have to pay the minimum wage to workers they choose to let go or don’t hire in the first place. Many positions will be automated, or employers will give additional responsibilities to more experienced workers.
Read the rest at City Journal.