South Americans Wary of Chavez

How dangerous is Venezuelan strongman Hugo Chávez? Everybody is suddenly getting anxious about lefty dictators taking over in South America. But one result of his saber-rattling is that other South American leaders are moving closer to the United States, according to Martin Krause.

South American leaders have been meeting in Vienna to negotiate with the European Union about a free-trade pact. And it turns out that many of the leaders are less than elated with the Venezuelan’s bully-boy tactics.

Chávez did a great job breaking up the Summit of the Americas in November 2005, but the result seems to have been to encourage leaders to move more towards a private economy and expanded trade. Writes Krause:

The socialist Chilean president Michelle Bachelet continues and deepens the reforms of past decades, they are now even considering the privatization of jails. The socialist Uruguayan president is asking for bilateral trade negotiations with the US.

The Peruvians sent home the Venezuelan ambassador for meddling in their election. And the Brazilians aren’t too happy about Bolivia expropriating their state oil company, Petrobras.

And what happens to Venezuela’s big stick when oil prices go back down again?

It's the Law and Order, Stupid

The boast of Tony Blair’s New Labour Party was “joined-up” government, a government that would communicate with itself and get things done.

And the British people believed it.

Unfortunately bureaucratic organizations are designed for precisely the opposite purpose, for imposing top-down strategy. It is like an army. The general at the top issues the order and the underlings all execute his plan.

That means if you want to do something more flexible than fight battles and march from A to B, the bureaucratic model is not the best fit.

If you want a flexible, responsive system then you must choose the market as your organizational model. A market, need we add, in which people spend their own money buying goods and services. Other Peoples’ Money need not apply.

The ruin of New Labour was inevitable. You can’t make government bureaucracies into flexible, responsive, “joined-up” organisms. And the more you try, the more the bureaucracy just slows down to a stop, and ceases doing anything.

So now, nine years after being swept into office on a platform to be “tough on crime, tough on the causes of crime,” and after egregious failures to keep the peace, Blair is reduced, according to the London Spectator, to asserting that

the criminal justice system is ‘still the public service most distant from what reasonable people want’.

Well, do tell. The criminal justice system is just about the only thing that government should be doing.

But modern progressive government doesn’t care about that. Its bureaucracies are too busy handing out loot to the government’s supporters in the name of compassion and sensitivity to care about law and order. Anyway, you can’t do anything about crime until you have corrected the root causes of crime in poverty and alienation.

So Britain is sitting about where the US was back in 1990 when 30 years of liberal policing had reduced the inner cities to a violent hell.

On Immigration, Just Keep the Economy Growing

So which is it? Robert Samuelson says that immigration is a problem because there’s a conflict coming between a burgeoning Hispanic immigrant population of the less-educated and retiring baby-boomers who are going to want their benefits.

The American Immigration Law Foundation says that the Hispanic immigrants are doing fine and that

Latinos experience substantial socioeconomic progress across generations compared to both their immigrant forefathers and native Anglos.

Let’s face it. There has been a conflict between established Americans and immigrants since the founding. The common school movement was founded in part to force assimilation of the dangerous Catholic Irish that were emerging in the 1830s. Then we were worried about Jews in 1900, blacks in the 1960s, and now Hispanics in the 21st century.

The problem is always the same. Will the uneducated, unadapted immigrants trash the America that we higher-toned Americans have so tenderly built?

Then answer always is: We can’t be sure. Up to now, immigrants have always assimilated into the spirit of democratic capitalism, more or less, sooner or later. But will they assimilate this time?

In The New Americans Michael Barone shows how Jews, Italians, and Irish were the problem immigrants at the turn of the 20th century, just as East Asians, Hispanics, and Blacks are the problem now. Their success in assimilation depended upon their exposure, before arrival in the urban economy, to the culture of the rule of law.

Then as now the Democrats latched onto the new immigrants for their votes and also because Democrats believe in race, class, and ethnic politics.

What will happen this time? We don’t know. But we can help things along by making sure that there are jobs, jobs, jobs. As long as there are jobs, then people can rub along.

It is when the economy goes seriously south, as during the Great Depression when the suits totally screwed things up, that you need to watch out.

So while it is sensible to worry about resentful immigrants and selfish baby-boomers, the big thing is to keep the economy in good shape. You do that and a lot of problems just look after themselves.

Bush Signs Tax Cut and Market Falls Out of Bed

President Bush signed today the tax cut extensions recently passed by Congress. At the signing ceremony he said that

Our pro-growth policies stand in stark contrast to those in Washington who believe you grow your economy by raising taxes and centralizing power.

Meanwhile the stock market fell out of bed with the Dow declining by over 200 points to 11,205.61, down over 400 points since May 10. And the dollar has declined. And interest rates are going up.

Is this the end of the Goldilocks economy of the last three years? Or is the market testing new Fed Chairman Ben Bernanke, who has waffled about future interest rate increases.

In the United Kingdom, Anatole Kaletsky thinks the problem is that Bernanke has been too clear about his policy, reversing the deliberate obfuscation of Alan Greenspan.

He started off by emphasising, quite rightly, his strong belief in the Fed’s dual mandate: to maintain price stability and achieve the highest possible rate of economic growth. He then promised to call a halt to monetary tightening and do everything to keep the economy growing, even if inflation continued to accelerate “temporarily” in the months ahead. When currency and bond investors, whose wealth is decimated by inflation, quite predictably took umbrage and started selling their dollar holdings, Mr Bernanke quickly changed his tune and started presenting himself as an aggressive inflation-foe. He then “clarified” this apparently hawkish message by repeating that he might call a “pause” in the Fed’s rate hikes if that was what the economic statistics dictated.

Is that clear?

The truth probably is that the runup in oil prices has finally started to bite on economic growth. People at my local Arco gas station aren’t quite as eager to fill ’em up as they were back in January.

Could it be that investors are looking at future earnings and don’t think the future is quite as rosy as it was a few months ago?

Migration and Mexican Politics

What do the Mexicans think of Mexicans emigrating from their homeland to the jobs, jobs, jobs in the United States? We looked at this here at the Road to the Middle Class back in April.

Migration just entered Mexican presidential politics as lefty PRD candidate Andres Manuel Lopez Obrador called it “`Mexico's disgrace,’ caused by the government's failure to create enough jobs,” according to Alistair Bell of Reuters.

Well, that’s for sure. But what standing has any leftist anywhere to talk about jobs, apart from low-productivity government jobs financed by taxpayers’ money? Lopez wants to cancel Fox’s attempt to bring a free market to corrupt Mexico.

He vows to boost employment and cut poverty by slashing government spending, launching large infrastructure projects and introducing welfare programs for Mexico's poorest.

Oh good. That will really help.

President Vicente Fox promised to create “1 million jobs a year and oil-rich Mexico's economy has grown only slowly in his 5 1/2 years in office.”

Lopez also wants the US to help in Mexico’s development. As if we hadn’t, by pushing NAFTA and encouraging Mexico to lose its patronage economy.

The fact is that we know how to grow an economy. Ask the Chinese. Ask the Irish. Ask the Estonians. Ask Vaclav Kraus, former President of the Czech Republic, who just got an award from the Foundation for Economic Education.

But here’s a tip for you folks in Mexico. Don’t ask a lefty.

Let's Make a Deal on Immigration

Everyone has had their say after President Bush’s so-so speech on Monday. Conservatives have groused and grumbled; the MSM has grunted approvingly. Dick Morris seems to think the speech was great, which is really troubling.

Now Tony Blankley comes along and says: OK fellahs. Don’t forget, politics is about compromise. Let’s not make the mistake of picking up our dollies and going to play in the corner. Let’s make a deal today, and come back for more later if we need to.

[W]hen in negotiations, if he with whom you are negotiating is moving in your direction, don't walk out of the room. As a final proposition: In politics, as in life, you can't always get what you want, but sometimes you can get what you need

For those that believe that the central issue is a secure border, the fact is that President Bush “has moved measurably, but insufficiently, toward that position.” Now let’s capitalize on that movement and nail down a deal.

Ultimately, we need to control illegal immigration. We can and we should allow a strong flow of immigrants into the country, but let us be clear. Immigrants compete with the American working poor. And, echoing what Charles Murray said twenty years ago in Losing Ground, it is unjust to make patsies out of the working poor by favoring illegals and wasters over the hard, not very rewarding life of the lower middle-class striver. That is what was wrong with the War on Poverty, and that is what is wrong with turning a blind eye to illegal immigrants and workers.

There is a feeling of a sea change happening in conservative politics right now, a sense that we are moving on from the Reagan-Bush years. But let us nail down the best compromise we can get on immigratioin while we still can.

After November, we may have to deal with a Democratic Senate or Congress, and we know where they stand: Immigrants equals votes, and forget about the American people.

Strong Families Means Small Government

As we conservatives mumble around about doing something about the welfare state there are people out there with and idea to really do something about it.

After reading Love and Economics by Jennifer Roback Morse, Arnold Kling is inspired to write:

Single moms and the welfare state go together. Strong families and free markets go together.

What could be simpler? If you like strong families, then you should argue for a smaller state. If you like big government then you better understand that you are in favor of single moms and the destruction of the family.

But think of the implications. If you think that a strong state and strong families are incompatible, then you have to think about how to resolve problems without having the big powerful state step in and solve it.

If people know that they cannot rely on the state to arbitrate these issues, then they will turn to families, religious institutions, and other associations within communities to help strengthen our values.

What could be wrong with that? Well, top-down conservative government by Republicans, for one thing. After ten years of a Republican Congress we can see that Republicans aren’t going to do anything about big government. If there is to be a change, it will have to come from below.

Those who wish to be part of the solution should focus on strengthening our own families. The lesson of Morse's book is that strong families are the only antidote to the nanny state.

But that, of course, means work.