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Thank you to those who inquired about your correspondent’s health. We suffered a medical emergency over the weekend and had to go through surgery, but the surgery went well and after recovery yesterday we have been released. We are not yet able to move, but we are able to think and type, and therefore we are doing the Briefing. We thank our anonymous friend who wrote the Briefing yesterday, and hope disruption will be minimal.
Here are some of our latest articles you may have missed:
Interesting New Paper On How The Fed Produces Disinflation
Analysis: Excellent New Paper Makes National Security Case for Free Trade
More On JD Vance’s Tax Credit Vision
The child tax credit thing has kind of become a meme, hasn’t it?
In 2006 (we may as well say the dark ages), Ross Douthat and Reihan Salam wrote a book about how the Republicans should reach out to the working class. One of their ideas was a child tax credit.
Before 2016, a bunch of wonks who had the ear of a couple of members of Congress thought that expanding the child tax credit and encouraging family formation was both good policy and the key to a great new strategy for the GOP. One of these wonks was your correspondent. Another of these wonks was a young man named James David Vance, then working for a venture capital firm and finishing up a memoir about growing up poor in Appalachia.
Then came along a guy named Donald Trump. And the child tax credit idea (which had been taken up by Marco Rubio) was seized upon by the Trump faction as the example of everything wrong with the pre-Trump GOP. In his infamous “Flight 93 Election” essay, Michael Anton seized on that idea as an example of the penny-ante conservatism that needed to be swept away. It didn’t help that at the time, so many of these wonks (including Mr Vance and your correspondent) were horrified by Trump and opposed him.
And now, Donald Trump is no longer a business man but the 45th President of the United States, running for reelection, and his running mate is Ohio Senator J.D. Vance, and over the weekend, J.D. Vance gave an interview endorsing an expanded child tax credit.
Apart from this somewhat inside-baseball stuff, something significant has changed since 2016: the global collapse in birth rates has shown the emergency of trying to right the ship.
Still, the child tax credit idea remains controversial–and in part for good reason. Many conservatives legitimately fear that it could reintroduce the worst excesses of the welfare policies of the 60s and 80s that conservatives fought so hard to right with welfare reform.
In the current context of heightened deficits and numerous other fiscal promises by Trump, there is warranted skepticism about the budget impact.
We have had these debates a million times, but it was still informative to see Oren Cass give a very good summary of what matters about Vance’s proposal.
The first is to make the child tax credit refundable so working class families can access it. This is essential.
The second–and we were reassured that the CTC that is being envisioned is still tied to work, and therefore would not work as a welfare program. The simple mechanism is a prior year earnings threshold. Go read the whole thing.
ElonTrump
A confession: when we launched PolicySphere, we had a silent bet with ourselves about how long we could last covering right-of-center policy without ever writing the word “Trump.” (We sometimes used phrases such as “the previous President” or “the previous Administration.”) This was not to denigrate the 45th President, whom we support, but because his name creates so much light that it can be distracting.
Still, we are in the midst of a Presidential campaign, and Donald John Trump–since he is the nominee–sometimes does discuss policy and does so in interesting ways. This was particularly true of his conversation with Elon Musk. Musk opened the conversation by saying that a friendly conversation allowed to get a better sense of the person than a confrontational interview, and this proved true. We agreed with this thought from Beck & Stone partner Andrew Beck: “The Musk/Trump talk was one of the most normal things I’ve ever seen in politics. No theatrics. No pretense. Just two guys talking about the insanity they’ve witnessed. We forgot they’re the most famous men in the world. They’re just normal men. They reminded us we’re not crazy.”
And because it was more of a conversation than a confrontational interview, and because Musk is highly intelligent, he got Trump to opine on numerous points of policy which we found fascinating. Of course, they were couched in the usual vague Trumpian terms, but they still spoke of interesting directions.
No doubt influenced by his interviewer, in that conversation he outlined a much more “traditional” Republican approach to government: cutting government spending, fighting illegal immigration but embracing legal imigration, reducing regulations on business, abolishing the Department of Education, as well as sensible investments in infrastructure such as high-speed transit and nuclear power.
Maybe deep down, Donald Trump is just a Reagan Republican?
Policy Links
#HigherEd – Matthew Schmitz with a very clever idea on how to pursue higher ed reform without legislative change: whenever the federal government funds a university study, it tacks on 30 to 40% (sometimes more) in “indirect costs.” These costs are regularly subject to administrative review. You can figure out the rest. Very clever indeed.
#Markets – If there’s one thing most sensible policy analysts agree on, on both sides of the aisle and within the right’s various fractious factions, it’s that price controls are bad economics. Which is why it’s worrying that Kamala Harris wants to introduce so many price controls, as Cato’s Ryan Bourne and Sophia Bagley detail.
#LGBT – Leor Sapir shows that the dam over “gender-affirming care” in the US is starting to break. Various European medical bodies and authorities have already defected from the ideology. His new report at City Journal is fascinating.
#SocialSecurity – AEI’s public finance expert Andrew Biggs looks at a recent Morningstar report on Social Security spelling doom about retirees’ financial health, and explains why that’s based on faulty assumptions.
#DEI – Everyone should understand that the Southern Poverty Law Center is a hate group, designed to incite cancellation and violence against mainstream conservatives by associating them with nazism and white supremacy. Latest example: their attack on the mainstream public interest law firm Alliance Defending Freedom for defending viewpoint diversity, a concept upheld by decades of Supreme Court jurisprudence, as “white supremacist”. More here. They’re just hacks.
#Energy – R Street’s excellent policy analyst Josiah Neeley informs us that wind power is down for 2023 and asks why.
#Deficits – As worries about the deficits grow, the technical details of how exactly the Treasury funds its borrowing may come to matter, which is why Bloomberg’s excellent financial commentator Joe Weisenthal did a long interview on precisely that topic.
Chart of the Day
Hungary’s pro-family policy may not have worked at reversing its birth rate decline, but it seems to have worked at boosting marriage–surely an unalloyed good on its own, and perhaps a step in the direction of reversing the fertility crisis? In any case, we were struck by this chart. (Via Philip Pilkington)
Meme of the Day
