Category: Uncategorized

Tom Woods has a short 1 hour interview with Keith Knight about his 4 hour podcast arguing against Democratic Socialism.

---

Discussion from legalclarity.org

Pro and Con snippets from the Legal Clarity article are given below.

The Case That FDR Prolonged the Depression

The Cole-Ohanian Study

The most influential academic argument that New Deal policies extended the Depression came from economists Harold Cole and Lee Ohanian in a 2004 study published in the Journal of Political Economy. Using a dynamic general equilibrium model, they concluded that policies under the National Industrial Recovery Act of 1933 and the National Labor Relations Act of 1935 effectively cartelized large portions of the American economy, keeping output and employment well below where they should have been.

Their core finding was striking: New Deal cartelization policies accounted for roughly 60 percent of the gap between actual economic output and where it would have been based on long-run trends. By 1939, real wages were far above what the labor market could sustain, output per adult remained 27 percent below trend, and private hours worked were 21 percent below trend. The NIRA had allowed industries to set prices collectively and suspended antitrust enforcement, while labor provisions empowered unions to bargain for wages that, in Cole and Ohanian’s model, priced many workers out of jobs entirely. Although the Supreme Court struck down the NIRA in 1935, the researchers argued that the Roosevelt administration continued to tacitly permit these monopolistic arrangements for years afterward.

Ohanian estimated that these policies lengthened the Depression by approximately seven years, reducing real income and output by 14 percent compared to a scenario where the NIRA had never been enacted.

Economist Robert Higgs offered perhaps the most focused version of the investment argument. His “regime uncertainty” thesis held that the Depression persisted not because of any single bad policy but because the cumulative weight of New Deal legislation — the Social Security Act, the National Labor Relations Act, the Revenue Acts of 1935 through 1937, and the threat of more to come — made business owners too afraid to invest. Net private investment for the entire period of 1930 to 1940 totaled negative $3.1 billion.

The Case That the New Deal Aided Recovery

Growth Was Actually Spectacular

Critics of the prolongation thesis point to what the economic data actually show about the recovery’s pace. Christina Romer, the Berkeley economist who later chaired President Obama’s Council of Economic Advisers, documented in a widely cited 1992 paper that real GNP grew at an average rate exceeding 8 percent per year between 1933 and 1937. Between 1938 and 1941, it grew at over 10 percent annually. Romer called this “spectacular” growth and noted it was among the fastest sustained expansions in American history outside of wartime.

The puzzle is that despite these growth rates, the economy remained below its long-run trend. GNP was still 26 percent below trend in 1937 — but that was because the hole created by the 1929–1933 collapse was so deep, not because recovery was slow. The economy had fallen 35 percent from 1929 to 1933; climbing back from that depth at 8 percent a year simply took time.

Romer attributed the recovery primarily to monetary expansion rather than fiscal policy. The money supply grew at nearly 10 percent per year from 1933 to 1937, driven largely by gold inflows after Roosevelt devalued the dollar in 1933 and by capital fleeing political instability in Europe. Without this monetary expansion, Romer calculated, real GNP would have been roughly 25 percent lower by 1937.

What Complicates the Debate

Several factors make a clean verdict difficult. One is the question of what counts as “prolonging” the Depression. If the standard is whether unemployment returned to 1929 levels, it did not until wartime mobilization — unemployment was still 14.6 percent in 1940. If the standard is whether growth was rapid, it clearly was: 9 percent annual real GDP growth from 1933 to 1937 is hard to characterize as stagnation. The Cole-Ohanian model measures the gap between actual output and a theoretical trend; critics counter that assuming the economy would have snapped back to trend without intervention is itself an unproven assumption, especially given the banking collapse and deflationary spiral of 1929–1933.

Jim Babka in a Facebook post remined us of the following.

Mexican migrants to the USA didn’t create U.S. imperialism, war fascism, the New Deal, or the military-industrial-congressional complex. They didn’t ratify the Sixteenth Amendment, create the Fed, or enact Medicare and Medicaid. They didn’t build up a ruinous public debt, pass the USA PATRIOT Act, or maintain a torture facility at Guantanamo. They didn’t turn the local police into Rambo wannabes with SWAT teams and armored vehicles. They don’t scoop up and record everything you write on the Internet, say on the telephone, or post on Facebook.

Why then are people so afraid that letting Mexicans enter the USA to work will lead to a loss of freedom, rather than afraid of the red-white-and-blue-blooded Americans who have already stripped them of nearly every liberty their forefathers enjoyed and who are eager to crush every liberty that remains? – Robert Higgs 7/7/13 yet seemingly timeless.

From the WSJ – 7/8/2026

Mark Penn and Andrew Stein are right to warn that “The Socialist Threat Is Real” (op-ed, July 3). But they overlook its true origin. The Democratic Party’s current socialism didn’t emerge in a vacuum; it is the logical extension of the New Deal and the Great Society, which transformed the federal government from a relatively limited constitutional republic into the nation’s primary provider of income, retirement, healthcare and welfare.

Once Americans are taught that Social Security, Medicare and Medicaid are not government programs but inalienable rights, the philosophical foundation for socialism has already been laid. If retirement income and medical care are rights guaranteed by Washington, why shouldn’t housing, college tuition, child care and a guaranteed income be rights as well? Democratic socialists merely carry this premise to its logical conclusion.

The debate has shifted from whether the government should redistribute wealth to how much redistribution is enough. Democratic socialists simply argue that if the government can tax one group to finance benefits for another, then even higher taxes on upper-income Americans and greater government control over private property are justified in the name of the “common good.”

Those who wish to halt the advance of socialism must challenge its intellectual roots, not merely its latest political manifestations.

Murray Sabrin

After explaining why comparing today’s governments intervening in the economy should not be considered just returning to the policies of Alexander Hamilton, Dave gives an introduction to economics starting at about 35:00.

We’re hearing a new message from many American social democrats. They say they’re not against capitalism. No — they simply want capitalism “guided” by democratic institutions. Markets with guardrails. Innovation with supervision. Economic freedom with a firm political hand on the shoulder.

It sounds moderate. It sounds reasonable. But history tells a different story. When government becomes too eager to “improve” capitalism, it usually ends up smothering the very dynamism that makes capitalism work.

We’ve seen this pattern before.

In the late 1970s, the United Kingdom was living under what was called the post‑war social democratic consensus. The government owned airlines, railways, steel mills, car manufacturers, shipyards, and utilities. It set prices. It dictated wages. It negotiated industrial policy through political bargaining instead of market signals.

And what happened?

Stagnation. Flat productivity. Vanishing investment. Innovation didn’t just slow — it fled. The country became a museum of yesterday’s industries, preserved not because they worked, but because politics insisted they should.

Let’s look at another example: India’s “License Raj.” For decades, entrepreneurs needed government approval for everything — opening a factory, expanding production, even changing product lines. Bureaucrats, not customers, decided which industries deserved to grow.

The intention was fairness. The result was decades of anemic growth, shortages, and a suffocating culture of paperwork. Only when India liberalized in the 1990s did its economy finally begin to breathe again.

And yes, even the United States has had its own experiments with heavy-handed economic management. In the 1970s, strict regulation of airlines, trucking, and telecommunications produced high prices, limited choices, and sluggish innovation. When those industries were deregulated — when markets were allowed to operate with fewer political constraints — competition surged, costs fell, and innovation exploded.

The lesson is clear: when government tries to choreograph economic life, the dance becomes slow and predictable. When markets are free to move, they surprise us.

This is the tension modern American social democrats rarely acknowledge. They say they want capitalism — but capitalism is not a polite system. It is unruly. It is experimental. It is inconvenient. It rewards risk-takers and punishes complacency. It allows industries to rise and fall without consulting a committee.

A “busy-body” government — one that feels compelled to supervise, correct, and steer — inevitably clashes with this spirit. It tries to make capitalism behave. It tries to make markets predictable. It tries to make innovation conform to political priorities.

And in doing so, it drains the energy that makes capitalism vibrant in the first place.

Supporters of this model often argue that democratic control ensures fairness. But fairness enforced through political power can easily become rigidity. When every new technology, business model, or industry must pass through layers of political approval, the economy becomes cautious. Entrepreneurs spend more time navigating regulations than creating value. Companies optimize for compliance rather than creativity. Workers face fewer opportunities because political gatekeepers decide which sectors deserve encouragement and which should be “guided” into decline.

The irony is striking. Social democrats often celebrate the fruits of capitalism — innovation, abundance, rising living standards — while promoting a system that makes those fruits harder to grow. They want the benefits of a wild ecosystem, but insist on pruning it like a formal garden.

History shows what happens when governments prune too much: the garden stops growing.

Now, let me be clear. Government has a role. Markets need rules. Societies need safety nets. But there is a difference between setting the rules of the game and trying to play the game from the referee’s chair.

The former preserves dynamism. The latter replaces it with political management.

The United States has thrived because it embraced the messy vitality of capitalism. It allowed people to try things without asking permission. It tolerated failure. It rewarded success. It let markets discover what politicians could not.

If modern social democrats truly want to preserve capitalism, they should remember what makes it work: freedom, experimentation, and a willingness to let economic life unfold without constant political supervision.

A government that tries too hard to guide capitalism ends up guiding it into stagnation. History has already shown us that. The question now is whether we are willing to learn from it.

When Government Tries to “Improve” Capitalism, It Usually Strangles It Instead

American social democrats increasingly insist they are not anti‑capitalist. They say they simply want capitalism “guided” by democratic institutions—markets with guardrails, innovation with supervision, and economic freedom with a firm political hand on the shoulder. It’s a comforting formulation, suggesting moderation rather than ideology. But history offers a less flattering translation: whenever government becomes too eager to “improve” capitalism, it ends up smothering the very dynamism that makes capitalism work.

The pattern is familiar. A political movement decides that markets are too chaotic, too unequal, too unpredictable. So it proposes a more “active” government—one that will steer investment, regulate behavior, and ensure outcomes that align with its social priorities. The intention may be noble. The results rarely are.

Consider the late‑1970s United Kingdom, when the post‑war social democratic consensus had grown into a sprawling apparatus of state control. The government owned airlines, railways, steel mills, car manufacturers, shipyards, and utilities. It set prices, dictated wages, and negotiated industrial policy through political bargaining rather than market signals. The result was not a fairer, more stable economy. It was stagnation. Productivity flatlined. Investment dried up. Innovation fled. The country became a museum of yesterday’s industries, preserved by political sentiment rather than economic reality.

Or look at India’s “License Raj,” a system born from the belief that democratic oversight should tightly manage capitalism. For decades, entrepreneurs needed government approval for everything from opening a factory to expanding production. Bureaucrats—not customers—decided which industries deserved to grow. The intention was to prevent exploitation and ensure balanced development. Instead, India endured decades of anemic growth, shortages, and a suffocating culture of paperwork. Only when the country liberalized in the 1990s did its economy finally begin to breathe.

Even the United States has its own cautionary episodes. In the 1970s, heavy-handed regulation of airlines, trucking, and telecommunications produced high prices, limited choices, and sluggish innovation. Deregulation—allowing markets to operate with fewer political constraints—unleashed competition, lowered costs, and sparked waves of technological progress. The lesson was clear: when government tries to choreograph economic life, the dance becomes slow and predictable. When markets are free to move, they surprise us.

This is the tension modern American social democrats rarely acknowledge. They say they want capitalism, but capitalism is not a polite system. It is unruly, experimental, and often inconvenient. It rewards risk-takers and punishes complacency. It allows industries to rise and fall without consulting a committee. It lets people pursue ideas that politicians may find unwise, unfashionable, or ideologically inconvenient.

A “busy-body” government—one that feels compelled to supervise, correct, and steer—inevitably clashes with this spirit. It tries to make capitalism behave. It tries to make markets predictable. It tries to make innovation conform to political priorities. And in doing so, it drains the energy that makes capitalism vibrant in the first place.

Supporters of this model often argue that democratic control ensures fairness. But fairness enforced through political power can easily become rigidity. When every new technology, business model, or industry must pass through layers of political approval, the economy becomes cautious. Entrepreneurs spend more time navigating regulations than creating value. Companies optimize for compliance rather than creativity. Workers face fewer opportunities because political gatekeepers decide which sectors deserve encouragement and which should be “guided” into decline.

The irony is that social democrats often celebrate the fruits of capitalism—innovation, abundance, rising living standards—while simultaneously promoting a system that makes those fruits harder to grow. They want the benefits of a wild ecosystem but insist on pruning it like a formal garden. History shows what happens when governments try to prune too much: the garden stops growing.

None of this means government has no role. Markets need rules, and societies need safety nets. But there is a difference between setting the rules of the game and trying to play the game from the referee’s chair. The former preserves dynamism. The latter replaces it with political management.

The United States has long thrived because it embraced the messy vitality of capitalism. It allowed people to try things without asking permission. It tolerated failure. It rewarded success. It let markets discover what politicians could not. If modern social democrats truly want to preserve capitalism, they should remember what makes it work: freedom, experimentation, and a willingness to let economic life unfold without constant political supervision.

A government that tries too hard to guide capitalism ends up guiding it into stagnation. History has already shown us that. The question now is whether we are willing to learn from it.

A More Hands‑On Government Means a Less Vibrant Economy: A Critical View of Modern Social Democratic Capitalism

In recent years, many American social democrats have adopted a new rhetorical posture: they insist they are not opposed to capitalism, only to “unregulated” capitalism. They claim to support markets—just markets tightly supervised, directed, and corrected by an energetic democratic government. On paper, this sounds like a compromise. In practice, it often resembles a political project that treats economic freedom as something suspicious, something that must be constantly monitored, nudged, and restrained.

The core tension is simple. A vibrant economy depends on spontaneity: people experimenting, building, failing, trying again, and discovering new ways to create value. Innovation is messy. Growth is unpredictable. Prosperity emerges from millions of decentralized decisions that no committee, agency, or legislature can foresee. But the social democratic model increasingly assumes that economic life should be shaped according to political priorities—priorities that shift with elections, interest groups, and ideological fashions.

When government becomes the chief architect of economic outcomes, markets lose their dynamism. Entrepreneurs spend more time navigating rules than inventing things. Businesses optimize for compliance rather than creativity. Workers face a landscape where opportunities narrow because political gatekeepers decide which industries deserve encouragement and which should be “guided” into decline. The economy becomes less a living ecosystem and more a managed garden—trimmed, pruned, and fenced until the wild growth that produces breakthroughs is replaced by predictable, politically approved shrubs.

Supporters of this model often describe it as humane, fair, or stabilizing. But the tradeoff is real: the more a government tries to orchestrate economic life, the less room individuals have to pursue their own ideas, ambitions, and experiments. A system that constantly intervenes to correct market outcomes inevitably ends up deciding which outcomes are acceptable in the first place. And once politics becomes the arbiter of economic possibility, the economy’s natural energy begins to fade.

This is the paradox at the heart of modern social democratic capitalism. It promises to preserve markets while simultaneously constraining them. It claims to champion innovation while subjecting innovators to an ever-expanding list of political expectations. It insists it is pro‑growth while treating the unpredictable nature of growth as a problem to be solved rather than a strength to be embraced.

The result is a model that may be orderly, may be well‑intentioned, but is unmistakably limiting. A vibrant economy requires freedom—not just the freedom to operate within rules, but the freedom to surprise, disrupt, and challenge the status quo. When government becomes too busy steering, supervising, and correcting, it inevitably slows the very dynamism it claims to protect.

(from Copilot: Please verify details with official state sources.)

Florida voters will see a proposed constitutional amendment on the November 2026 ballot that would make several significant changes to property taxes beginning in 2027. The amendment affects homestead exemptions, non‑homestead assessment caps, and how local governments may use property tax revenue.

Key Provisions

1. Larger Homestead Exemption (Non‑School Taxes Only)

• Adds a new $150,000 homestead exemption in 2027.
• Increases to $250,000 in 2028.
• Applies only to county and municipal taxes, not school district taxes.
• Starting in 2029, the exemption increases annually with inflation.

2. Residency Requirement for New Floridians

• Individuals who become Florida residents on or after January 1, 2027 must live in the state for five consecutive years before qualifying for the new exemption amounts.

3. Lower Assessment Cap for Non‑Homestead Property

• The annual assessment increase limit for non‑homestead property (such as rentals, second homes, and commercial property) would drop from 10% to 5%.

4. Limits on How Local Governments May Use Property Tax Revenue If approved, counties and municipalities could use ad valorem tax revenue only for:

• Public safety (police, fire, EMS)
• Public schools
• Roads, bridges, and stormwater infrastructure
• Natural resource and flood control projects
• Debt service
• Employee retirement benefits
• General government operations and administration

5. Local Option to Increase Exemptions

• The Legislature must create a uniform process allowing counties, cities, and school districts to increase exemptions up to the remaining taxable value.

Effective Date

If approved by voters, all changes take effect January 1, 2027.

My Opinion

No one can predict the secondary effects, and that seems to be what most people are discussing.

Although the amendment will benefit me, I am against it.

From a public‑policy standpoint, the proposed increase to Florida’s homestead exemption is misguided because it narrows the tax base instead of broadening it. Sound tax policy spreads the burden across as many taxpayers as possible, not just those who meet a specific residency threshold. This amendment applies only to residential property owned by individuals who live in Florida at least six months a year — the same group eligible to vote on the measure. By carving out benefits exclusively for the voting class while excluding non‑resident owners and other taxpayers, the proposal functions less like a structural reform and more like a targeted “voter tax reduction.” Such selective relief undermines fairness, distorts the tax system, and shifts the cost of public services onto a shrinking share of property owners.