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Daniel Hannan makes a powerful case that “the world still needs what America stands for” – and so, too, do Americans. Three slices:

The American Revolution was a rejection of British citizenship, not of British values. Indeed, it was a clamorous assertion of all the things that, in the eyes of the Founders, had made them British in the first place: personal autonomy, representative government, religious liberty, habeas corpus, jury trials, the sanctity of contract, the rule of law, and constraints on executive power.

As Winston Churchill was to put it in his History of the English-Speaking Peoples: “The Declaration was in the main a restatement of the principles which had animated the Whig struggle against the later Stuarts and the English Revolution of 1688.”

American visitors to London are sometimes surprised to find prominent statues of six U.S. presidents, including Abraham Lincoln in Parliament Square and George Washington in Trafalgar Square. Yet, even in 1776, the American cause enjoyed widespread support in Great Britain. The most brilliant parliamentarians of the era, Edmund Burke, Charles James Fox, and Pitt the Elder, all favored the patriots. So, as far as we can make out, did a majority of the population — though, with a more limited franchise than in the colonial assemblies, that majority was not replicated in the House of Commons.

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To put it more briefly, the foundational value of the United States is liberty. I feel slightly silly having to write that, as it would recently have gone without saying. But when lots of young American conservatives are disowning the Founders and writing excitedly about Catholic integralism or the jurisprudence of the Nazi lawyer Carl Schmitt, it bears repeating. Listen to the two presidents whose statues have pride of place in London.

“Interwoven as is the love of liberty with every ligament of your hearts, no recommendation of mine is necessary to fortify or confirm the attachment,” said George Washington in his Farewell Address. Abraham Lincoln at Gettysburg defined the nation as having been “conceived in liberty.”

What does liberty mean? It means that the people in power can’t boss others around. It means that politicians are servants and not rulers. It means that private property and free contract are respected, that the coercive force of the state is a last rather than a first resort, and that the people in charge don’t get to make up the rules as they go along. It means, in short, a government of laws and not of men — a phrase attributed to John Adams, although, demonstrating my point about the Founders’ British identity, Adams was quoting the 17th-century English radical James Harrington.

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How secure is that tradition at home? Both parties seem increasingly unwilling to accept results that don’t suit them. There is, again, something creepily un-American about personality cults, about the willingness to contract out your opinions to a father-of-the-nation type, to change your views when he changes his.

The Founders would have had Trump down as a “Caesarist,” meaning a man whose personal ambition outweighed his respect for the republic. They would have been appalled, less by his executive power-grabs or desire for a third term — they knew such men — than by the obsequious way in which others encourage him to exceed his authority. They designed America expressly to prevent arbitrary rule.

Eric Boehm decries the cowardice of most Republicans regarding Trump’s tariffs punitive taxation of Americans’ purchases of imports. Two slices:

Rep. Tom McClintock (R–Calif.) describes himself as a “tariff skeptic.”

In that regard, his judgment seems sound. President Donald Trump’s tariffs are hiking costs for businesses and prices for consumers. They are not delivering the promised boom in manufacturing jobs. Polls show that most Americans dislike them.

Unlike most Americans, however, McClintock was in a position this week to translate that skepticism into action.

Given that chance, McClintock (and the vast majority of his Republican colleagues) chose cowardice and voted to continue Trump’s unilateral executive control over American trade policy.

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Few other Republicans said it as openly as McClintock did, but he’s hardly the only coward in the crowd. The “baseline House Republican position” is tariff skepticism, an unnamed administration official told Politico on Wednesday.

That makes a lot of sense, because you don’t have to be an economist to be a tariff skeptic at this point. Consider the amount of bonkers tariff-related news that happened just this week:

• Trump admitted he placed tariffs on Switzerland—tariffs that are ostensibly a response to a “national emergency”—because he was grumpy about how the country’s “prime minister” spoke to him on a phone call. (Switzerland has no prime minister.)
• Ford said it plans to spend an extra $1 billion this year due to tariffs on imported aluminum, which is pretty essential if you’re in the business of building cars.
• Goodyear announced that it expects to lose $175 million to tariffs this year due to tariffs, and that it would cut 450 jobs to offset some of those costs.
• The Congressional Budget Office reported that American consumers are bearing roughly 95 percent of tariff costs.
• Republican leaders reportedly tried to sway Rep. Don Bacon’s (R–Neb.) vote on a tariff matter by promising tailored tariff relief to businesses in his district.

Let’s dwell on that last item for just a moment. Faced with a possible Republican revolt over tariffs, the White House was reportedly trying to cut deals to reduce tariffs for certain parts of the country while maintaining them broadly.

First and foremost, that’s an admission that tariffs are being paid by American businesses and consumers (otherwise, there would be no relief to be offered).

Wall Street Journal columnist Allysia Finley asks: “Why is the Trump administration continuing the Biden push for ‘inclusive’ credit scores?” Two slices:

A wrong-headed political drive in Washington to make housing more affordable fueled the 2000s housing bubble, which burst into the 2008-09 financial crisis. Now we’re seeing history rhyme as federal housing regulators create perverse incentives that are sure to lead to inflated credit scores that will let riskier borrowers take out lower-interest mortgages.

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At least the Biden FHFA required lenders to submit to Fannie and Freddie both a FICO and VantageScore for all loans. Mr. [FHFA Director Bill] Pulte, however, announced last summer to much fanfare that lenders would be allowed to choose which score to use when underwriting mortgages. The end of this story writes itself.

Lenders will always choose the higher score so they can make more mortgages to risky borrowers—and at lower rates. Fannie and Freddie charge higher fees to insure mortgages for borrowers with lower credit scores. That means Fannie and Freddie will guarantee riskier mortgages and charge less for doing so.

Chesapeake Risk Advisors’ Clifford Rossi estimates that severe-delinquency rates could increase by 18%. The consulting firm Milliman predicts default rates will rise by some 30%. The American Enterprise Institute’s Ed Pinto, Tobias Peter and Sissi Li estimate guarantee fees will fall by 10% to 13%, putting taxpayers at greater risk.

Reality isn’t optional even for charismatic, slogan-slinging east-coast socialists who win landslide elections. A slice:

Zohran Mamdani was happy to promise lower rent for New Yorkers on the campaign trail. But now that he’s the guy stuck with the bill, the mayor is having second thoughts.

The socialist seems to be walking back a campaign promise to expand the city’s billion-dollar rental voucher program. The City Fighting Homelessness and Eviction Prevention Supplement was launched in 2018 to help keep low-income New Yorkers out of shelters by subsidizing permanent housing. The program’s cost ballooned from $25 million in 2019 to more than $1 billion in 2025, making it one of the nation’s largest rental assistance programs.

Ditto for west-coast collectivists, as reported by Shawn Regan. A slice:

Los Angeles has a history of progressive housing policies that sound good in theory but prove counterproductive in practice. Measure ULA, the city’s so-called “mansion tax,” is the latest example, and it’s one of the most unreasonable.

Approved by voters in 2022, Measure ULA imposes steep taxes on real-estate sales worth over $5 million. The revenue is meant to fund affordable housing and tenant assistance. Advocates’ pitch for the measure was straightforward: tax luxury-property sales and use the proceeds to tackle homelessness and affordability. Supporters estimated that the measure could generate nearly $1 billion annually for housing programs.

Four years later, Los Angeles officials are beginning to acknowledge that the policy has not worked as intended. Last month, City Councilmember Nithya Raman—who supported Measure ULA when it was on the ballot—introduced a motion calling for changes to the tax, warning that it had produced “unintended consequences.” Measure ULA, she argued, “stalls housing production” and “ultimately undermines the very goals voters asked us to achieve.”

Raman is right. Measure ULA has both raised less revenue than promised and discouraged the kinds of property transactions that make new housing possible, including new multifamily units. In trying to tax its way to affordability, L.A. has worsened its housing shortage.

In response to people who today point with much fear – but with little knowledge of history – to lots of recent immigration to the U.S. from Latin America, Jeremy Horpedahl tweets: (HT Scott Lincicome)

15% of the population of Ireland entered the US between 1851 and 1860

9% of the population of Norway entered the US in the 1880s

6% of the population of Italy entered the US from about 1900-1910

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… is from page 533 of F.A. Hayek’s brilliant Postscript – “Why I Am Not A Conservative” – to the Definitive Edition (Ronald Hamowy, ed., 2011) of Hayek’s 1960 volume, The Constitution of Liberty:

Follies and abuses are no better for having long been established principles of policy.

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Here’s a letter to the Wall Street Journal.

Editor:

Hopefully Donald Trump will read Joseph Sternberg’s column describing the economic doldrums inflicted on that continent by E.U. economic interventions (“Hurrah! Europe Is Fighting Over Economic Policy,” February 13). Should he do so, the president might rethink his assertion that the E.U. has been “screwing us” on trade – a faulty conclusion that Mr. Trump grounds on the fact that the E.U. has consistently run annual trade surpluses with the U.S.

To describe real per-capita GDP in the E.U. since 2009 as remaining flat would be generous; in 2025 it was slightly lower than it was 16 years earlier.* In the U.S., in contrast, real per-capita GDP rose over these same years by 32 percent. And yet in each of those years the U.S. ran a trade deficit with the E.U., as well as with the rest of the world, while the E.U., with the exception of 2022, ran a trade surplus with the rest of the world.

These data point to a reality that Mr. Trump stubbornly refuses to acknowledge – namely, a country or region runs trade deficits whenever it attracts more global capital than it repels, and it runs trade surpluses whenever it repels more capital than it attracts. The E.U. consistently runs trade surpluses, and the U.S. trade deficits, not because the E.U. is cheating or besting America at trade but, rather, because the E.U.’s growth-stifling policies are repellant to global investors while America’s more market-oriented policies are attractive to these investors.

Mr. Trump’s obsession with putting an end to U.S. trade deficits is an obsession with making America repellant to global investors and, hence, more like stagnant Europe.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

* The nominal per-capita GDP dollars were converted into real dollars using this GDP deflator.

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The Editorial Board of the Wall Street Journal reports on yet further evidence that nearly all of Trump’s tariffs punitive taxes on Americans’ purchases of imports are being paid, indeed, by Americans. A slice:

No matter how often President Trump insists his tariffs are taxing foreigners to enrich the U.S., economic studies keep showing that Americans actually pay the bill. On Thursday it was the New York Federal Reserve’s turn. In an analysis on the bank’s website, four researchers write that last year “nearly 90 percent of the tariffs’ economic burden fell on U.S. firms and consumers.”

They reach that conclusion by examining import data, to see whether foreign suppliers cut their prices in response to Mr. Trump’s added tariff costs. Over the first eight months of 2025, “94 percent of the tariff incidence was borne by the U.S.,” the analysis says, meaning “a 10 percent tariff caused only a 0.6 percentage point decline in foreign export prices.”

This outcome drifted as the year wore on, but only slightly: The figures for November suggest the tariffs had “an 86 percent pass-through to U.S. import prices,” the researchers say. “Our results show that the bulk of the tariff incidence continues to fall on U.S. firms and consumers. These findings are consistent with two other studies that report high pass-through of tariffs to U.S. import prices.”

This is a problem for both shoppers and Republicans, including Mr. Trump. Even if tariffs aren’t generally inflationary, they’re taxes that can push up prices on specific imported items, as well as on the products of the protected domestic competitors. Recent inflation reports, including the one that came out Friday, show some notable jumps, such as for furniture and bedding, which in January was up 4%, year over year.

Adam Miller tweets: (HT Scott Lincicome)

Part of my job is approving tariff invoices billed to the small manufacturing firm where I work. These tariffs are passed on to our customers (industrial utilities like electric power generation and water treatment facilities), who undoubtedly pass them on to consumers.

The Washington Post‘s Editorial Board draws an important lesson for us Americans from the Russian government’s authoritarian crackdown on social media. Two slices:

The Russian government’s decision this week to ban WhatsApp and throttle Telegram is not a surprise for an authoritarian regime. Yet it also serves as a cautionary tale for westerners clamoring to regulate social media companies.

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The very concept of “disinformation” implies the state gets to decide who may speak, to whom and on what terms. The machinery of control is the same, and more often than not, it’s used to protect a regime. This is the beginning of a road that ends where Russia now is.

C. Jarrett Dieterle decries Mayor Mamdani’s war on delivery apps. Here’s his conclusion:

Mamdani’s war on gig is getting a lot of press. But beyond the flashy headlines, it’s clear that both workers and consumers are likely to suffer.

Jeffrey Miron shares new research that finds that minimum-wage legislation inflicts more harm on black workers than it does on white workers. [DBx: As my late, great colleague Walter Williams often said: If the Imperial Wizard of the KKK were to make a list of that evil organization’s most-preferred government policies, minimum-wage legislation would be at or near the top. It’s sad that so many economically clueless progressives – many of whom, ironically, boast PhDs in economics – allow their addiction to social-desirability bias to blind them to the economic realities of government legislation that prices many low-skilled workers out of jobs in the formal economy, or that otherwise reduces the attractiveness of these workers’ employment options. These progressives would not argue that, say, legislated minimum prices for automobiles would improve the economic prospects of sellers of used cars. Yet they make an economically identical argument in favor of legislated minimum prices for human labor.]

David Inserra criticizes the Federal Trade Commission for using the power of the state to suppress free expression in the guise of protecting free expression. A slice:

Federal Trade Commission Chairman Andrew Ferguson recently addressed a letter to Apple CEO Tim Cook to suggest that the Apple News product may be in violation of the FTC Act.

Apple’s crime?

Its Apple News product, which curates news from a variety of sources, has “systematically promoted articles from left-wing news outlets and suppressed news articles from more conservative publications,” including recently not featuring “a single article from any American conservative-leaning news sources.”

The FTC’s allegations of bias, even if true, are ultimately irrelevant. The FTC has no authority to regulate the speech that Apple News chooses to curate. This is core First Amendment territory that even the FTC is forced to acknowledge. Ferguson writes that the “First Amendment protects the speech of Big Tech Firms” and that the “FTC is not the speech police; we do not have the authority to require Apple or any other firm to take affirmative positions on any political issue, nor to curate new articles based on the perceived ideological or political viewpoint of the article or publication.”

If Chair Ferguson stopped there, perhaps we could appreciate that the FTC recognized its limits and its respect for the First Amendment’s protections for platforms to exercise editorial control over the speech they collate and organize.

But Chair Ferguson did not stop there. Instead, the Chair attempts an end run around the First Amendment by accusing Apple News’ curation practices of violating the FTC Act for being an unfair or deceptive trade practice. But this attack is predicated on a highly flawed theory that somehow the FTC has the ability to determine when the curation and moderation decisions of platforms are “unfair or deceptive.”

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… is from page 63 of Thomas Sowell’s 1999 book, Barbarians Inside the Gates:

Promoting competition as a process is the opposite of promoting the survival of existing competitors. Unless and until public policy clearly and fully recognizes that fact, fanciful crusades and sinister theories will drive public policy toward the computer industry.

DBx: Yes. And nearly 30 years after these words were written, fanciful antitrust crusades and sinister ‘competition’ theories – such as those peddled by the likes of Lina Khan and embraced by many Trump administration antitrusters – continue to plague the American economy.

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Ed Crane is remembered by the Editorial Board of the Wall Street Journal. A slice:

He rightly concluded that before you can change American politics you have to win the battle of ideas. So in 1977 he helped to found Cato, first as a small operation out of San Francisco, then growing it over several decades into a formidable think-tank promoting free-market principles and policies until his retirement in 2012. He was, if we may use an oxymoron, a libertarian builder.

In 1981 Crane moved Cato to the belly of the beast: Washington, D.C., where it continues to torment statists and elites who assume they know what’s best for everyone else. Cato isn’t as large as many other policy shops, but it continues to punch above its weight in engaging scholars, newsmen and politicians in the great ideas of the free economy. This mission is even more important now that both major political parties lack notable champions for free-market principles.

Also remembering Ed Crane is the Atlas Foundation. A slice:

A charismatic speaker, eloquent writer, and visionary leader, Ed played a greater role than perhaps any other in building a base of financial supporters who have prioritized the ideas of liberty. His involvement in the Presidential campaign of Libertarian Party candidate Ed Clark in 1980 allowed Ed Crane to develop a national network of generous friends of liberty, whose enthusiasm would go on to power the Cato Institute’s ascension to a top tier think tank in American life.

Ed’s vision extended far beyond any single organization. He believed deeply in a vibrant ecosystem of institutions advancing liberty from different angles, in different countries, and with distinct but complementary approaches. In that spirit, he was a valued friend and supporter of Atlas Network. His generosity toward our work manifested itself most dramatically when he helped arrange a transfer of programs and personnel, led by Tom Palmer, and funding to support them, in late 2008, to jumpstart Atlas Network’s evolution into a truly global enterprise.

Ed’s wife Kristina Crane began a long association with Atlas Network at this time, and our team has continued to benefit from her steadfast commitment to advancing liberty worldwide. Kristina’s dedication has reflected the same belief that animated Ed’s life: that the principles of liberty are universal and that they must be nurtured through strong, independent institutions that resist political fashions and partisan pressures.

The freedom movement is, at its core, a community of individuals who devote their lives to expanding opportunity and preserving the dignity of the human person. Ed Crane was among the most influential of his generation. The institutions he built, the leaders he mentored, and the ideas he championed will continue to shape debates for decades to come.

My intrepid Mercatus Center colleague, Veronique de Rugy, is – rightly – not starry-eyed about government regulation.

Jack Nicastro is – rightly – appalled by the FTC chairman’s threatening letter to Apple’s Tim Cook: “Chairman Andrew Ferguson continues the Federal Trade Commission’s crusade against free speech with an official letter to Apple CEO Tim Cook.” A slice:

Deliberately withholding certain perspectives from the public may not be especially ethical, but the First Amendment allows Apple to platform whatever it pleases.

Scott Lincicome responds – with this superb letter in the Wall Street Journal – to Peter Navarro’s evidence-free assertion that foreigners pay the bulk of Trump’s tariffs:

Peter Navarro’s “Foreign Countries Bear the Burden of Tariffs” (Letters, Feb. 11) on foreigners indirectly paying U.S. tariffs is correct in theory yet detached from reality.

If the U.S. actually had the market power he describes, foreign exporters would in many cases lower their prices to keep selling their goods here, thus offsetting the tariffs’ domestic costs. In practice, however, the U.S. hasn’t been hegemonic in global markets for many years, thanks to the proliferation of regional supply chains and growing economies outside our borders.

Given the relatively low and declining U.S. share of global merchandise trade, economists predicted in 2024 that producers abroad would respond to U.S. tariffs not by lowering their prices here but by diverting trade elsewhere and forcing Americans to bear the tariffs’ costs. This is exactly what’s happened. China, for example, saw its U.S. exports decline in 2025 yet had strong overall export growth and a record trade surplus thanks to higher sales in other markets.

U.S. nonfuel import prices, which include discounts and rebates but exclude tariffs, would show major declines if exporters were eating Mr. Trump’s tariffs, but they were slightly up in 2025.

Many studies—not only from Harvard and the Kiel Institute, which Mr. Navarro blithely dismisses, but also the St. Louis Federal Reserve Bank, the Tax Foundation, economists Gita Gopinath and Brent Neiman, and Goldman-Sachs, among others—have examined real-world transactions and found that U.S. companies and consumers are bearing almost all the tariff burden via higher retail prices or input costs. There are exceptions, but the data confirm they’re not the rule.

Mr. Navarro needn’t, however, read wonky economics papers to see that Americans are paying Mr. Trump’s tariffs (and the higher prices for U.S.-made alternatives that tariffs encourage). Instead, he could ask the thousands of American business owners and farmers who say they’re suffering under the weight of Mr. Trump’s ill-conceived trade wars. They have voiced these concerns in shareholder earnings calls, media interviews, court challenges, bankruptcy filings, regulatory comments and town hall meetings. Hundreds of small-business owners from across the country have even formed a coalition called “We Pay the Tariffs.” These good folks would jump at the chance to go to the White House and tell Mr. Navarro who, exactly, is paying these taxes—if, that is, they had enough lobbying clout to get through the front door.

Jennifer Huddleston and Christopher Gardner argue persuasively that government should not ban AI chatbots.

Timothy Taylor warns of rising U.S. government indebtedness. Here’s his conclusion:

The costs of excessive federal debt are gradually becoming apparent in various ways. The inflation spike a few years ago was, in part, driven by the spike in federal deficits. The arguments between the Trump administration and the Federal Reserve over interest rate policy are driven, in part, by the recognition that high federal interest payments are crowding out other possibilities for greater spending or tax cuts. Concerns over large US trade deficits are created, in part, because the very large US budget deficits are creating an ongoing surge of US demand for imports. Concerns over slow rates of US economic growth are driven, in part, by concerns that high federal borrowing is crowding out some opportunities for private-sector investment. The current trajectory of federal deficits and debt seems sustainable for awhile longer, in the sense that it doesn’t seem likely to cause a near-term crisis, but that doesn’t make it a desirable path for the US economy to follow.

Jeff Eisenach sheds no tears for the demise of the pre-transformation Washington Post. A slice:

The journalism practiced by the Post in recent years has mainly been of the sort lately taught in journalism schools. Woke, ideological, biased—a loyal ally of the Democratic party. It told us Russia-gate was real, ignored Joe Biden’s decline, hewed unquestioningly to the establishment line on Covid, and reportedly had at least a dozen reporters covering climate change, all reporting the same deeply flawed story as “settled science.” The death of that sort of journalism is something to celebrate, not mourn.

Bob Graboyes shares some interesting trivia about U.S. vice-presidents.

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… is from page 84 of the American jurist James Coolidge Carter’s profound, yet unfortunately neglected, (posthumous) 1907 book, Law: Its Origin, Growth and Function [original emphasis]:

A judicial precedent is not law per se, but evidence of it only. The real law is custom.

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Here’s a letter to my long-time “Proud Trump man” correspondent, Nolan McKinney.

Mr. McKinney:

You “laughed out loud” at Phil Gramm’s and my suggestion that Trump’s second-term tariffs helped cause jobs to grow at a much slower pace in 2025 – the first year of his second term, one filled with tariff hikes – than in 2017, the first year of his first term, before tariffs were raised. You credit your amusement to the fact that “the President is aggressive at deporting illegal immigrants which steal American jobs.” The slower job growth in 2025, you insist, “only happened because of the immigration crackdown.”

LOL!

If the jobs once held by deported immigrants were indeed ‘stolen’ from Americans, then the removal of immigrants from those jobs would have caused Americans to fill those same jobs, resulting in no slowdown in employment growth. But there has in fact been a huge slowdown in employment growth, which means – if you’re correct that this slowdown in employment growth was caused by the mass deportation of immigrants – that immigrants were not ‘stealing’ jobs from Americans.

Sincerely,
Don

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The Editorial Board of the Wall Street Journal rightly applauds the Environmental Protection Agency:

The Environmental Protection Agency on Thursday at long last repealed Barack Obama’s so-called endangerment finding that declared greenhouse gas emissions a threat to public health and safety. Cue the apocalyptic warnings unhinged from reality. What progressives really fear is that they won’t be able to dictate the energy supplies, cars and appliances that Americans can buy.

The Editorial Board of the Wall Street Journal also rightly criticizes the Federal Trade Commission:

Lina Khan may have left to advise Zohran Mamdani in New York, but her ghost still animates the Federal Trade Commission under new Chair Andrew Ferguson. That explains how the agency has now drawn a First Amendment challenge for allegedly targeting a media outfit.

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The FTC justifies its action on grounds that NewsGuard is itself engaging in censorship. Mr. Ferguson has said NewsGuard “led collusive ad boycotts—possibly in violation of our antitrust laws—to censor the speech of conservative and independent media in the United States.”

But Mr. Ferguson misreads the law in going after NewsGuard, a private outfit. The First Amendment protects private actors against censorship by the government.

We’re not fans of media rating shops, since they typically have their own mostly leftward biases. PolitiFact is Exhibit A. NewsGuard’s James Warren once sent us an importuning query objecting to something in an op-ed we had published. But we thought it was a matter of opinion and ignored Mr. Warren, a former political columnist.

Alex Tabarrok’s high hopes that a Trump FDA would be more freedom-oriented than under past administrations have been dashed. Here’s his conclusion:

An administration that promised medical freedom is delivering medical nationalism: fewer options, less innovation, and a clear signal to every company considering pharmaceutical investment that the rules can change after the game is played. And this isn’t a one-product story. mRNA is a general-purpose platform with spillovers across infectious disease and vaccines for cancer; if the U.S. turns mRNA into a political third rail, the investment, talent, and manufacturing will migrate elsewhere. America built this capability, and we’re now choosing to export it—along with the health benefits.

Arnold Kling nicely sums up a significant reality: “The post-liberal right is smugly ignorant of economics.”

My intrepid Mercatus Center colleague, Veronique de Rugy, argues that ill-consequences will arrive more quickly than in the past from the U.S. government’s failure to seriously rein in entitlement spending.

Speaking of excessive government spending and of the dangers of deficit financing, Dominik Lett reports on the Congressional Budget Office’s recent warning of ballooning budget deficits.

Here’s the abstract from a new paper by Brian Albrecht, Alex Tabarrok, and Mark Whitmeyer:

Price controls kill the incentive for arbitrage. We prove a Chaos Theorem: under a binding price ceiling, suppliers are indifferent across destinations, so arbitrarily small cost differences can determine the entire allocation. The economy tips to corner outcomes in which some markets are fully served while others are starved; small parameter changes flip the identity of the corners, generating discontinuous welfare jumps. These corner allocations create a distinct source of cross-market misallocation, separate from the aggregate quantity loss (the Harberger triangle) and from within-market misallocation emphasized in prior work. They also create an identification problem: welfare depends on demand far from the observed equilibrium. We derive sharp bounds on misallocation that require no parametric assumptions. In an efficient allocation, shadow prices are equalized across markets; combined with the adding-up constraint, this collapses the infinite-dimensional welfare problem to a one-dimensional search over a common shadow price, with extremal losses achieved by piecewise-linear demand schedules. Calibrating the bounds to stationlevel AAA survey data from the 1973–74 U.S. gasoline crisis, misallocation losses range from roughly 1 to 9 times the Harberger triangle.

Jimmy Alfonso Licon explains that “immigration arrest quotas undermine ICE’s mission.” A slice:

The logic is straightforward. Violent criminals, gang leaders, and professional smugglers are difficult to locate and expensive to apprehend, often relying on networks of other people to help them evade detection. Pursuing such criminal organizations requires investigations, coordination across jurisdictions, surveillance, and uncertain outcomes, making it easy for agents to come up empty-handed. By contrast, unauthorized immigrants who are otherwise law-abiding are comparatively easy to find. They have fixed residences, work regular jobs, and their children often attend the local school.cMany are already interacting with the state through legal channels, including standard immigration check-ins.

When arrest quotas rise, then, it’s no surprise that arrests have accelerated disproportionately among those who are easiest to find and arrest rather than those who pose the greatest threat.cRecent data confirm this pattern.cEnforcement activity has surged, but the majority of arrests involve individualswithout prior criminal convictions,ca distribution consistent with quota-driven optimization rather than threat-based prioritization. And given the career and political incentives behind meeting those quotas, it is what we should expect. This behavior is rational given the incentives; it would be surprising if agents behaved otherwise.

George Will is understandably appalled, if not surprised, by the adolescent boorishness of the current vice-president of the executive branch of the United States government. A slice:

When, during the 2024 campaign, rumors about Haitians eating the pets of Springfield, Ohio, were disseminated, with Vance’s help, this was his response when confronted with the fact that no facts supported the rumors: “If I have to create stories so that the American media actually pays attention to the suffering of the American people, then that’s what I’m going to do.” He has a duty to lie because the media are indolent.

Vance has a knack for late — very late — adolescent naughtiness. It is not easy being transgressive in an era when there are few norms remaining to transgress. Undaunted, he tries. Of Europe’s largest war since World War II: “I don’t care what happens to Ukraine one way or another.” Very edgy.

Performative politics is almost the only politics on offer nowadays. But must it be a coarseness and flippancy competition?

Let it be said on Vance’s behalf that he refuses to present himself as other than what he is. But before celebrating him for his authenticity, attention should be paid to what he authentically is.

John Tamny remembers Ed Crane.