My last few posts discuss the need for U.S. leadership in world affairs. We are the strongest country in the world, economically and militarily, and we should step up and take this responsibility more seriously.  No other country can do it nearly as well as we can.

How are we lacking, and what do we need to do differently?  The AEI scholar, Kori Schake, gives the answer in a recent issue of Foreign Affairs.  We should always:

• Promote American security and economic power while supporting the expansion of democracy around the world. This means maintaining a strong military, cooperating with allies to advance shared interests, and advocating free trade while ensuring fair international competition for U.S. companies.
• The world is growing more dangerous, and foreign policy bears directly on the state of our domestic economy. The Biden administration works from the theory that U.S. foreign policy has failed the middle class and needs to be repaired through market protections and government subsidies.  This approach has stoked inflation, distorted markets, stunted trade, and frustrated U.S. allies.
• A majority of Americans, in both political parties, believe their country should provide better leadership, invest in military power, promote international trade, support freedom and democracy, and stand with Ukraine until it wins its war against Russian aggression. Americans are reluctant internationalists, but internationalists all the same.
• The guiding principle of U.S. policy toward China should be to force or motivate it to become a more responsible economic and geopolitical stakeholder – to play by international rules. Washington should long ago have tightened restrictions on U.S. funding for Chinese military technologies.
• The problem with U.S. strategy toward globalization in the past 20 years has not been that Washington allowed too much trade but that it permitted trade that did not establish reciprocity – trade that did not create a level playing field. Trade deficits with China cost the U.S. 3.7 million jobs between 2001, when China was admitted to the WTO, and 2018.  Three-fourths of these lost jobs – 2.8 million – were in manufacturing.
• Little unites Americans more strongly than the belief that the U.S. military should be strong. More adequate funding for defense will necessarily require entitlement reform, especially for Social Security and Medicare.  Entitlements now constitute 63% of federal spending, up from 19% in 1970.  The federal debt stands at $34 trillion.  By 2025 or 2026, interest payments on that debt will exceed defense spending.
• The failure to protect the U.S. southern border and therefore, to properly regulate immigration, is leading the U.S. to neglect its current biggest geopolitical opportunity: consolidating North American cooperation. U.S. politicians do not worry enough about the downside of Mexico sinking into criminality, especially with unregulated trade in illegal drugs.

Conclusion.  Rejoining the Trans-Pacific Partnership, negotiating and securing the ratification of other trade treaties, increasing defense spending while reforming entitlements and reducing the national debt, securing the U.S. – Mexican border, and aiding countries fighting to preserve their liberty: these are the major goals we should strive for in foreign policy.  Americans support a strong role for the U.S. as world leader, both for the country’s sake and for their own individual safety and prosperity.

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My last few posts have discussed the current great need for leadership in the world and why only the U.S. can provide it.  Wars, inflation, political uncertainty, the rapid growth of technology, all of these major events create a complicated and chaotic environment.  The reason why it is so critical for the U.S. to step up to the moment is because we are the strongest country in the world by far, and thus, only we can provide the leadership that is needed so badly.

Consider:

• We are the oldest democracy in the world, our brilliant constitution being ratified in 1787, with only 27 amendments having been passed in the last 236 years. The U.S. is an “invented” nation (as opposed to an evolved nation), established less than 200 years after the first settlers arrived in the early 1600s.  With a population of over 330 million, we are the third largest country in the world, behind only India and China.
• We have natural geographical advantages, such as stretching across the entire North American continent, with friendly neighbors, Canada and Mexico, on our borders. This makes the U.S. much easier to defend.
• As a nation of immigrants, we are descended from rugged individualists willing to risk their lives and livelihoods to travel across the ocean and establish themselves on a new continent.
• By the mid-1800s, as the nation began to fill up and industrialize, a system of universal public K-12 education developed so that all citizens would have an opportunity to become literate and acquire useful skills. At the present time, with public K-12 education floundering, especially in the larger cities, school choice alternatives are springing up across the country.
• Our free enterprise economic system provides maximum opportunity for individuals to thrive by developing their natural talents into productive careers. In fact, our amazing entrepreneurial business culture has now led to nine of the top ten companies in the world being American.

  

• Economic growth leads to social advancement. There are plenty of naysayers about the American economy, but it is still the best there is. We have achieved huge economic and social advancement in recent years and continue to do so.

  

• As the top power in the world, the U.S. has adversaries such as China, Russia, Iran, and North Korea, who envy our elevated status and want to bring us down.  But we also have many strong democratic allies around the world.  Democracies seldom go to war with each other.  Together with our allies, we have far greater economic and military strength than our adversaries.

  

Conclusion.  The U.S. has many strengths as a nation that we should clearly recognize but never take for granted.  We are the one indispensable nation in the world and should accept the responsibility to assume a strong leadership role.  It is in our own best interest to do this because the world will then be much better off as a result.

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The outbreak of war in Gaza between Israel and Palestine has created a tense atmosphere around the world, which can only be mitigated by U.S. leadership.   Republicans can help by acting in a responsible manner, but the Democrats are largely in charge under President Biden.

The problem is that Bidenomics, the economic policy of the Biden Administration, is unsustainable.  Consider:

• The main problem with Bidenomics is that it relies far too much on deficit financing which drives us the national debt.  The deficit for FY 2023 is $1.7 trillion, up from $1.4 trillion in FY 2022.  Such huge deficits greatly overstimulate the economy and, therefore, make inflation worse than otherwise and much harder for the Federal Reserve to control.
• The Inflation Reduction Act’s manufacturing tax credits include “prevailing wage” requirements, which force firms that take the money to meet or exceed the average minimum wage for that type of work. The requirements prevent firms from competing to reduce labor costs and effectively make unions wage setters.  Forcing nonunionized employers to pay the same wages as unionized ones is unionization by other means.
• Census Bureau data exposes the true cost of Bidenomics. Median real (inflation- adjusted) income has decreased each year since 2019 (see chart).
• The following chart shows even more dramatically the comparison between wage growth and inflation between the Trump years and the Biden years. Wage gains exceeded inflation during the Trump years but started to fall behind shortly after Biden took office in January 2021.  Only in the last few months has that trend reversed itself.
• Swing state voters, according to age, education, or income, all think that Donald Trump’s management of the economy is preferable to Joe Biden’s.

Conclusion.  The world now needs U.S. leadership more than ever.  The U.S. can’t continue to provide strong leadership without a strong economy.  Bidenomics does not provide a strong economy in the long run.  This is a huge problem going forward, with  implications for the U.S. presidential elections next year.

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My last several posts have been on the role of U.S. leadership in the world.  Since the end of WWII, it has been U.S. strength and leadership that have led to relative peace in the world (no more world wars).  Now China, Russia, and Iran are working together to challenge U.S. supremacy. It is critical that the U.S. meet this challenge head-on, to deter this new axis of autocratic powers lined up against us.  For the time being, Joe Biden is in charge, and we must hope that he is capable of providing the necessary leadership to prevail over our adversaries.  In the meantime, it is critical for Republicans to act in a responsible manner by addressing our most basic problems.  Consider:

• Our biggest domestic problem by far is the rapidly growing national debt. The Republican House of Representatives can provide major leadership on this problem by insisting that Congress return to “regular order” in setting annual budgets. This means that the House and Senate each pass their own version of the twelve basic appropriation bills, and then meet in conference to negotiate any differences.  This will lead to a close look at each federal agency by “experts,” and only as much money being appropriated as is actually needed to operate the agency.  Regular order has the potential to save hundreds of billions of dollars each year by eliminating wasteful and unnecessary spending.
  In addition, it is a good idea to set up an independent fiscal commission to propose reforms of other expensive government programs such as entitlements.

  

• Republicans need to abandon isolationism and continue to financially support our strong allies, Ukraine and Israel, in their efforts to resist aggression from Russia and Iran’s proxy, Hamas.  Only by defending democracy where it is threatened, can the autocratic powers lined up against us be held in check.  In particular, the best way to deter China from invading Taiwan is to continue to help Ukraine.  If Russia is not stopped in Ukraine, it will eventually decide to invade a NATO country, and then the U.S. will be drawn into an even bigger war.
• I personally will not vote for a Presidential candidate who might abandon Ukraine. Right now, of the three leading Republican candidates, Trump, Haley, and DeSantis, only Haley is unequivocal in her support of Ukraine.

Conclusion.  In today’s dangerous world, the U.S. simply cannot afford to appear weak.  The Republican House can show strength by maintaining sufficient unity to insist on “regular order” in establishing the budget for FY 2024.  It also needs to continue support for threatened democratic allies such as Ukraine, Israel, and Taiwan.  Let us hope that the eventual Republican nominee for President in 2024 will also pledge to continue support for Ukraine.

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My last few posts have been concerned with how badly the world needs U.S. leadership at the present time.  We are the strongest country in the world, both economically and militarily, and no other country can come close to providing the effective leadership role that we can.

Consider:

• The Middle East Situation. Israel does not want to occupy Gaza after Hamas is destroyed.  It is critical to work with our autocratic, but nevertheless valuable, Muslim allies Egypt and Saudi Arabia to solve the Palestinian problem.  One key to a viable solution is deterring the active involvement of Iran and its proxies.
• It is also critical to continue helping Ukraine defend itself from the Russian It is not only the right thing to do but is also in our best interest.  Russian success in Ukraine will encourage China to become more belligerent toward Taiwan.  Russia and Iran have formed a military axis to oppose the U.S.  In other words, the Ukraine/Russian war and the Israeli/Hamas war are linked.  Success on one front helps us on the other.
• As much as China wants to take over Taiwan, it is not likely to attempt this by military force, as long as the U.S. has the military strength and will to help Taiwan defend itself.
• Restoring public support for global leadership is an urgent need and should be a high priority.  First, we have to go beyond pivoting to Asia. We need a strategy for dealing with the entire world. Second, we must employ all the instruments of national power, such as trade agreements as well as security agreements.  Thirdly, we need a stronger nuclear deterrence and a bigger navy in the face of a Chinese-Russian alliance.  Finally, Congress needs to act more quickly and efficiently in approving annual defense budgets.

Conclusion. Israel appears to be on track to destroy Hamas in Gaza.  Only by continuing to work with Egypt and Saudi Arabia to deter Iranian support of terrorism can we establish a lasting peace in the Middle East.  We must continue to help Ukraine in defending itself against the Russian invasion.  We will have peace with China as long as we are strong both economically and militarily.  Restoring public support for global leadership should be a very high priority.

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Last week, I wrote that the world needs U.S. leadership more than ever.  This has now become urgent!  What should the U.S. do with respect to the Israel/Hamas conflict?  Writing in the Wall Street Journal, Richard Haass says that the goal for U.S. diplomacy with Israel should be to achieve “first calm, then peace.”

In more detail:

• First, punish Hamas for the October 7 attacks and limit its ability to carry out additional terrorism. The proper role of the U.S. is not to try to prevent a significant military action, which is inevitable, but to shape its scale and duration. Israel needs to minimize civilian casualties by limiting military actions to precision strikes.  Furthermore, get as many hostages out of Gaza as quickly as possible.  In addition, Israel should not try to occupy Gaza.

  

• Secondly, once the situation is stabilized, begin a renewed effort to normalize ties between Israel and Saudi Arabia and between Israel and those Palestinians willing to eschew terrorism. Bringing about a degree of calm and stability would make it possible to deal with core Israeli-Palestinian issues, which must be resolved if what happened this month is not to occur again and again.  Hamas would play no role in negotiations about the Palestinian future.  The focus should be on developing a Palestinian partner in the West Bank, one willing to renounce violence, live alongside Israel, and hopefully eventually lead to a viable state.
• Saudi Arabia is an important potential partner in this endeavor. The Saudi leadership is interested in obtaining a civilian nuclear energy program from the U.S., as well as a Senate-approved security pact.  The Saudis could demand restraint on settlements and greater interim Palestinian self-governance.

  

• Deterrence of Iran is also required.  America’s core problem in the Middle East is the march of an unappeasable Iran toward regional power, regardless of moral or human cost.  The U.S. is losing its power to deter.  Putin’s 2022 invasion of Ukraine, in defiance of direct American warnings, was a major step.  Iran’s support for Hamas’s strike on Israel is an even bolder attack on the American order.  If the President’s response to Hamas and its patron, Iran, fails to restore respect for American power, and will, our enemies everywhere will draw conclusions and take steps that we and our allies won’t like.

Conclusion.  President Biden has a huge challenge as well as a unique opportunity to assert American leadership.  His response to the Hamas terrorist attack on Israel must, simultaneously, support Israel’s right to respond forcefully, restrain Israel from over-retaliating, and clearly deter Iran from further destabilizing the explosive situation that now exists.  This is a critical test of his ability to lead the free world against our autocratic rivals.

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As I have said many times, I am optimistic about the future of the United States.  We are the strongest and one of the freest countries in the world, and are doing many things right.  We are not in decline in any fundamental sense!  Nevertheless, we do have serious problems which urgently need to be addressed.  In fact, one can describe our current political situation as borderline chaotic.  Consider:

• At over $33 trillion, our national debt is out of control.  At a time of strong economic growth, annual spending deficits should be reduced, not increased!  Instead, they are way too large, for example, in the amount of $1.7 trillion for FY 2023 which just ended.  Inflation, kicked off by the $5 trillion in Covid stimulus spending, is still too high and persistent.  This has forced the Federal Reserve to raise interest rates substantially, which, in turn, has caused interest payments on the debt to soar.  The solution is clearly to reduce annual spending deficits as quickly as possible.  The President could get this done if he wanted to!
• Open Southern Border.  There are now so many immigrants entering the U.S. illegally along the southern border that the Biden Administration has decided to extend the wall construction, after waiting 2 ½ years, begun during the Trump Administration, but not yet completed.
• Violent crime surge in big cities. Violent crime is surging in big cities across the country because progressive prosecutors are not willing to crack down on hardened criminals.
• Kevin McCarthy is ousted as House Speaker. Led by Rep. Matt Gaetz, Republicans have removed Kevin McCarthy as Speaker of the House.  McCarthy was doing an excellent job, and tried to give the Freedom Caucus the spending cuts and border security measures it wanted.  The Freedom Caucus refused to take yes for an answer and ousted McCarthy instead, handing a victory to big-spending Democrats.

Conclusion.  Too many of our national leaders are acting like children.  They need to grow up and address the problems, such as debt, border security, violent crime, and the need for sensible leadership that the American people of all races, creeds, and political parties want them to do!

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In our free and open society, we have vast sources of information, with varying degrees of credibility.  With the rise of artificial intelligence, we now also have to worry about computer-generated misinformation.  How do we decide what is more or less true, or even false?  The only way to do this in any coherent way is to have an overall point of view about the world.  Here is my latest attempt to describe my own personal framework.

• Democracy is the best form of government. Democracy simply means that leaders at all levels are chosen by free and fair elections.  Democratic methods may involve many twists and turns, but will lead to more stable government in the long run.  For example, President Trump tried to overthrow the results of the 2020 presidential election but with absolutely no success.  This was a stress test for democracy, which survived with flying colors.
• The U.S. Constitution was a brilliant achievement by our founding fathers. The Constitution was ratified by the 13 original colonies in 1787, meaning our country has survived for 236 years, by far the longest-lasting democracy in the world.
• The U.S. greatly benefits from being a republic as well as a democracy. We are a collection of states, each with many areas of responsibility under the Tenth Amendment to the Constitution.  This decentralized nature of government is one of our country’s great strengths.  The electoral college gives a slight advantage to the smaller states in the election of a president, which is appropriate to counterbalance the stronger overall influence of the larger states.  States are free to try to improve services on their own initiative.  For example, because of dissatisfaction with public education, ten states have, just in the past few years, established some degree of universal educational choice for K-12 students.
• Free enterprise is the best form of economics. Capitalism completely outstrips socialism in generating prosperity.  Individual entrepreneurship leads to the greatest commercial advances.  Of the ten largest companies in the world in 2023, nine are American.  This proves the superiority of the American economic system.  Business success in turn, leads to higher wages for American workers.
• Economic growth leads to social advancement.  For example, African/Americans are moving up the economic and social ladder in greater numbers all the time.  
• We need a strong defense to make sure that democracy continues to prevail.  Democracy is not inevitable and we must be prepared to defend it.  In particular, it is right for us to continue helping Ukraine to resist its invasion by Russia.  This is the best way to deter China from attempting to take over Taiwan.
• Fiscal responsibility is critical.  Our national debt is now over $33 trillion and out of control.  The biggest problem is entitlement spending such as Social Security and Medicare. These programs must be reformed (not cut!) to make them sustainable for the long term.

Conclusion.  Based on this description of my outlook on American government and society, it should be clear that I am a strong believer in the American way.  Of course, we are far from perfect, but we have improved in many ways since our founding in 1787, and will continue to do so.  We should be confident, but never take for granted, that we have the good fortune to live in the strongest, and one of the freest, countries the world has ever known.  It is our responsibility to preserve this blessing; and pass it on in the best possible shape to our descendants.

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Over and over again, on this blog, I say that I am optimistic about the future of our country.  There is a lot of pessimism out there, but I think it is misplaced.  Consider:

• Democracy is thriving. Our two major political parties compete vigorously for votes.  The decentralized nature of our republican form of government is our best guarantee of free and fair elections.  There are 3143 counties in the U.S., and it is at the state and county levels where elections are regulated and conducted.  This ensures that any election fraud, unlikely to begin with, will be isolated and widely dispersed.  The claims of election fraud by President Trump, after the 2020 election, were totally rejected by other elected officials and the courts.  In other words, democracy has just had a stress test and passed with flying colors.
• Our economy is strong. Our free enterprise economic system has made us the strongest country in the world.  Real average hourly earnings for production and nonsupervisory workers are on a long-term upward trajectory (see chart).  Yes, they are down in the last two and a half years because of inflation, but the Federal Reserve will eventually bring inflation back to the desired 2% level, as painful and dragged out as this process may prove to be.
• Social progress. Our free and open society is leading to continued social progress by minorities.  In particular, blacks are moving steadily into the middle class.
• Our main adversaries have bigger problems than we do.  Our autocratic adversaries, especially China and Russia, want to bring us down. But they have much bigger problems than we do.  Of course, we can never afford to become complacent about the superiority of our democratic and free-enterprise system.  But, at the same time, we should be confident that we can continue to stay ahead of our adversaries by continuing to make our own society better and better.
• But the national debt is still a huge problem!  With spending deficits growing fast and now approaching $2 trillion per year, our rapidly accumulating national debt is an ever more alarming problem.   My overall optimism depends on our solving this problem before it leads to a new crisis!
• Conclusion.  Americans are fortunate to live in one of (if not the) strongest and freest societies ever to have existed in human history.  We are far from perfect but our dynamic political and economic system gives us a huge advantage in keeping ahead of our main rivals, China and Russia.  We should be confident that, by solving our debt problem, we will continue to predominate, and provide critical world leadership, for many years to come.

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