Ted Cruz's Only Hope for Indiana and Beyond: "The Government didn't build the American Dream..."

This has been a tough week for Ted Cruz. He lost 5 states by double digits. Of course they were all northeastern states which means there’s a snowball’s chance in Hell that they will be landing in the red column in November. Nonetheless Trump won them fair and square and he appears to have momentum.

So now there’s Indiana. The numbers are such that if Cruz does not win Indiana, it becomes almost impossible for him to stop Trump from getting to 1237. Given the glowing coverage that Trump gets from the mainstream media, as well as his cheerleaders in the erstwhile conservative media such as Drudge, Rush, and Hannity, Cruz finds himself very much fighting an uphill battle.

He can’t outTrump Trump. He can’t accuse Trump of lying – despite the fact that he is. He can’t accuse Trump of seeking to intimidate delegates – which he is doing. He can’t make nonsensical appeals to uninformed voters’ base instincts – because that’s not who he (Cruz) is. No, the only chance Ted Cruz has to win Indiana – and California beyond that – is to make his pitch for the American Dream.

Basically, it's that Dream that is behind so many voters flocking to Trump in the first place… that along with our celebrity worship culture where many elevate celebrities to a demigod state, regardless of their less than godlike behavior. Americans are angry that opportunities for advancement are disappearing. Americans are angry that every widget found in Wal-Mart is manufactured in China and every tee shirt in Pakistan. Americans are angry that an American icon, Ford, would reduce production here just to add production in Mexico. And Indianans are angry that Carrier would close a plant in Indiana just to open one in Mexico. The bottom line is, many Americans wonder what happened to a country where hard work and innovation were rewarded and where half the population was not on welfare of one sort of another.

One guy seems to be harnessing their anger and making it so they don’t feel like no one is listening… and that guy is Donald Trump. Ted Cruz needs to jump into the scrum. Ted Cruz needs to be crystal clear that he understands what they are feeling… but he shouldn’t pander while doing so… or he’ll be seen like Hillary trying to use an MTA card. No, Cruz has to talk about their issues, but do so in the context of what is causing them. Manufacturing is indeed moving the Mexico and China… but it’s not because companies like Ford and Carrier hate Americans… it’s because the government has made it so difficult for them to operate and earn a profit in the United States. And it’s not just labor costs, because Ford could have saved half its labor costs simply building the Focus in Alabama or Kentucky rather than Michigan. No, the much bigger problem for companies trying to manufacture and keep jobs in the United States is regulation.

Ted Cruz needs to point out that it’s not malice that encourages American companies to build products outside our borders… it’s government. Federal regulation costs the US $2 trillion a year… Looked at in jobs, just half that total would translate to 10 million new jobs at an average salary of $75,000 each. Unfortunately, this regulatory burden not only makes it more difficult for American companies to build here, it scares off international companies who might otherwise invest in the United States. Fundamentally, if the government would loosen the regulatory yoke and unleash American industry, our economy would once again dominate the world.

And then there is the IRS. Because at 40%, the United States has the highest corporate income tax rate in the developed world, companies find it less competitive to invest in the United States. Not only that, American companies have $2 trillion in profits sitting in subsidiaries around the world that they can’t bring home because it would cost them too much in taxes. That $2 trillion alone would provide 2 years of paychecks for 15 million Americans at $50,000 a year. By eliminating the IRS and implementing the Fair Tax – which Cruz likes but doesn’t push – a President Cruz would welcome trillions of dollars of investment in the United States from around the world.  Cruz's 10% income tax would have a similar, albeit a somewhat smaller impact.

At the end of the day, the only chance Cruz has to win Indiana and keep Trump from becoming the nominee is to clearly and forcefully articulate that the enemy of prosperity is not Carrier moving a plant to Mexico or Burger King moving its headquarters to Canada… it’s government strangling the American Dream one regulation at a time, it’s tax rates that handicap the country relative to the rest of the world. And in setting up that argument, he has to highlight the fact that Donald Trump’s solution of trying to tax Carrier back into the country is not the answer because for every Carrier that makes the news, there are hundreds of other companies around the world that aren’t located here and never will be because taxes and regulations simply make it too expensive to invest in the United States and create American jobs.

Donald Trump wants to scare companies into staying in the United States and employing Americans. Ted Cruz wants to inspire companies, both American and foreign, to invest in the United States and employ American workers. That’s a big difference and Cruz has to make that clear to voters. Trump wants to use the government to coerce companies to do what he wants while Cruz wants to lighten the government burden and allow American companies and American workers do what they do best, which is innovate and build their way to prosperity. The government did not invent the air conditioner, Willis Carrier did. The government did not bring the assembly line to the automobile, Henry Ford did. But government regulations have sent the companies those two men founded scurrying south of the border to build products in their names.  That is the shame of America in 2016... America used to be a place for entrepreneurship, innovation, invention and most of all, prosperity.  It's not today because of government.  The American Dream used to inspire both Americans and the rest of the world.  It doesn't do that much today because the government has smothered it...

And that's the message Cruz needs to get out:  "The government needs to get out of the prosperity killing business and out of the dream killing business... I understand that and I'll make it happen... Lifelong crony capitalist and John Boehner's golfing and texting buddy Donald Trump won't." 

Pies, Free Markets and the American Experiment

I've often used the phrase “when I’m rich” followed by, "I’m going to do X and Y and Z". Anyone hearing me say that could certainly be forgiven for thinking my primary motivation is to grow my bank account just for the sake of filling it up. In reality however nothing could be farther from the truth. While I do want to grow my bank account, it’s not the money. If it were I could probably figure out an easier way to do it than tilting at windmills seeking to start a successful business. Robbing a bank would be faster, as might stealing someone’s identity or running a Nigerian prince scam. But all of those things would defeat the purpose.

So what is the purpose? I want to be a part of the success that is the American experiment and feel like I've helped make the pie bigger. I constantly make the argument that the United States is the greatest nation in the history of man, by a long shot. The greatest period of improvement in the condition of man in all of human history just happens to coincide with the birth and ascendancy of the United States. And why is that? Simply put, it’s because of the limited government and rule of law dictated by our Constitution and our embrace of free markets. Those conditions have created a nation where free men can use their minds and bodies to create value where previously none existed. Whereas throughout most of human history scarcity was the norm, with men fighting over slices of the pies, American history has been a continuous march of creating ever more pies.

That doesn't mean that our history is perfect or that injustices did not take place, they did, and they sometimes do. But the history of human civilization is largely one where injustices were the norm rather than the exception and where the law was determined by whoever held the largest sword or commanded the largest army rather than by a constitution based on limited government and fundamental rights of the citizens.

That fortuitous, not to be confused with accidental, combination created an environment where things that simply could never have happened anywhere else happened here, or at a minimum, could not have occurred on an American scale. It was never our DNA that made Americans different, rather it was our limited government and our passionate support of free markets.

The result is more widespread prosperity than has ever been achieved in all of human history, and not only in the US, but in much of the rest of the world that has interacted with us. And the key to that advancing prosperity was a nation of citizens foolhardy enough to think that they could succeed by creating from their efforts products or services others were willing to freely exchange their hard earned money for. While industry and the division of labor are not uniquely American concepts, the notion that anyone from any station could not only participate in the marketplace, but could in succeed in it regardless of their background, is.

Thankfully I do not find myself in a society where heredity decides who succeeds and who fails, nor one where my religion or race or gender dictate my outcomes. No, I've had the good fortune to be born in a society where any individual can succeed in growing the pie of prosperity… it’s just a matter of figuring out how to create value for others… how to do something, to make something that others feel like is sufficiently valuable that they willingly pay you for it.

And so it goes that while I do indeed seek to grow my bank account, that is simply a measure of my success, not of how shrewd I can be to trick others out of their fortune or how strong I can be to take from others, but rather, that I have joined the pantheon of entrepreneurs and innovators who have harnessed the promise of the American experiment and created something of value to others… and ideally eventually leave the world a slightly better place than it was when I got here. Of course if I can afford to fly on NetJets rather than coach once or twice along the way I’ll be happy…

Which brings me to the X in my X, Y, Z… Which is supporting conservative candidates and figuring out how to communicate the value of limited government and free markets to a segment of the population to whom the concepts are utterly foreign.

It pains my heart to see the march of progressivism that has taken place over my lifetime. If you look you can always find problems, everywhere. Like zeroing in on a one month decline in a stock that has consistently grown in fits and spurts for decades, even when things are going well it’s easy to find areas of friction and failure. Unlike most of our history however, when the United States almost single-handedly drove the prosperity of the 20th century, it is those places of friction and failure that are now driving our politics and the resulting policies.

For most of human history the solution to the challenge of scarcity was not men creating more pies, but rather taking slices away from others, usually by the sword. The American experiment changed that and created a new, better, more effective solution for battling scarcity and as a result the world is a far more prosperous place. It’s no coincidence that as progressivism has grown over the last half century, American economic advances have similarly slowed.

Hopefully 2016 will be the apex of cancer of progressivism and the country will begin to return to a time when success meant creating value in the marketplace rather than using government coercion to take from those who do. It’ll take more than a small government, free market conservative in the White House to accomplish, but that’s a hell of a good first step.

From the Charlie Hebdo attack to your local street corner: Multiculturalism as a fount of bloodshed

There has been much commentary about the events in France over the last week. One of the major causes for the motivation behind the home grown terrorists who struck the offices of Charlie Hebdo is the fact that in many places in France, France is something of a foreign country. There are hundreds of “no-go” zones in the country where French police won’t go and French law has been supplanted by Sharia law. It is from these areas of largely disaffected, often unemployed youth on the government dole where much of this homegrown hatred emanates. These young people feel disconnected from the larger society, have little or no vested interest in the success of the larger society and often times are vocally disdainful of it.

In a very similar way, the United States is covered with neighborhoods where youth unemployment is sky high, where families spend generations on the government dole, and where there is little allegiance to the nation as a whole or the larger society. In France many of the young Muslims call themselves Muslims or Algerians and they rarely call themselves French. In the United States the hyphenated American such as African-American or Hispanic-American has replaced the designation of American for many.

While in the United States there may not be a religious component of that separation, there certainly is one similarly powerful: the cry of racism. The rallying cry of racism as the cause of the problems in various black and Hispanic neighborhoods around the country function in exactly the same way that radical Islam ideology does in France and other European nations. It drives separation. It drives anger. It drives a devaluation of the lives of others.

The separation is no accident. From Oakland’s effort some years ago to allow Ebonics in schools to Cinco de Mayo celebrations where the American flag is prohibited to college admission standards that vary by race to schools that teach American history is nothing but a chronicle of hate, prejudice and thievery against minorities and the poor; it’s little surprise that many young minorities feel like disconnected from the American Dream and larger society as a whole.

The anger is palpable. From race riots of the 1960’s to the Rodney King riots in 1992 to the recent riots in Ferguson, MO that inspired demonstrations across the country, many minority communities seem to be built on a tinderbox just waiting for spark. Extraordinary unemployment rates act as the tinder filling those boxes. In each case the spark was provided by the killing or striking of a black person by white cops. The resulting anger and destruction not only destroyed the neighborhoods of the rioters, but exacerbated the feeling of separation from the larger community as a whole. In the most recent case that anger resulted in demonstrations around the country and in New York with protesters chanting “What do we want? Dead cops! When do we want them? Now!” Soon thereafter they got their wish.

The devaluation of lives is heartbreaking. While Islamic terrorists killed 17 people in Paris last week, across the United States, in minority communities from Boston to San Diego young men are killing one another by the dozens every single week of the year. And those are only the thousands who die. Citizens of all sorts are assaulted, threatened and forced to try to live a normal lives in those struggling neighborhoods where drugs and crime and staggering unemployment are the norm rather than the exception.

Whether radical Islamic terrorists who seek to stifle free speech and murder infidels or a thug on an American street corner who is willing to shoot someone in cold blood because they wear a different color or have something coveted, both are products of a failed policy of multiculturalism. In France the left shut their eyes as Muslim communities separated from France and became isolated islands of radicalism. In the United States the left, through their destruction of America’s schools, their overregulation of job creating businesses, their demonizing of the police and through their distilling American history down to a chronicle of discrimination against blacks, Hispanics and Indians, have created a large swath of the population that has little comprehension of what the American Dream is, few tools with which to pursue it if they did, and most dishearteningly, little vested interest in the success of the country as a whole. In either case, liberalism and multiculturalism are the founts from which much bloodshed has been spilled. For anyone paying attention this should be no surprise.

Barackalypse Now, the story of one man's destruction of the American Dream

By now you have figured out that Armageddon did not occur on Friday and the dire warnings from the White House that the nation would essentially collapse were, shall we say, somewhat overstated.

That doesn’t mean however that the nation and American prosperity is in any less danger. Barackalypse Now is indeed upon us, and it has nothing to do with the Sequester. It has everything to do with the deranged economic policies of the Obama administration.

Virtually every American would like to be a little better off tomorrow than he or she is today. It makes no difference whether they are rich or poor, or whether they are happy with their current circumstances. Most of us would simply like to be a little better off next year and the years after than we are today.  Most of us don't mind working to make that a reality, but the question is, how we can accomplish it.

One way many people have chosen to pursue the American Dream has been to start their own businesses. The goal of entrepreneurs is often a mix of trying to become wealthy and doing something about which they are passionate. Every single company you know the name of or have interacted with started out at some point as just an idea that someone sought to do something with. Two such companies are Subway, the largest sub sandwich restaurant chain in the world and Home Depot, America’s largest home improvement chain. Both have thousands of locations, do billions of dollars a year in revenue and employ hundreds of thousands of people. Both companies started out with one unit each and grew into the 800 lb gorillas they are today. Interestingly, the founders of both companies say that if they started their companies today they could never have succeeded. And it has nothing to do with the recession, indeed Home Depot was founded in 1978 in the midst of the worst economic recession since the Great Depression.

Both founders cite government regulations for the reason that they could not succeed. Fred Deluca, the founder of Subway says:

It's continuously gotten worse because there's more and more regulations and it's tougher for people to get into business, especially a small business. I tell you, if I started Subway today, Subway would not exist, because I had an easy time of it in the '60s when I started and I just see a continuous increase in regulation.

Bernie Marcus, co-founder of Home Depot says this when asked why more businesses don’t complain about the regulatory burdens:

They are frightened to death — frightened that they will have the IRS or SEC on them. In my 50 years in business, I have never seen executives of major companies who were more intimidated by an administration.

Although overregulation has been getting worse for decades, the Obama administration has put the regulatory apparatus on steroids and uses the coercive power of government to intimidate businesses into submission. The result is that large companies like Home Depot, Subway, Google, Wal-Mart and others can hire armies of lawyers to bring them into compliance or find loopholes through which they can maneuver. Small businesses however, the fount of jobs, with their limited resources and bandwidth simply can’t compete. The result is that big companies get bigger and fewer competitors emerge as success as an entrepreneur becomes less possible.  It’s ironic that the administration that was so quick to embrace Occupy Wall Street’s disdain for big business has actually helped big business by suppressing potential competitors.

Another way Americans seek to improve their lives is to find a good paying job. Here too the Obama administration has punched the average American in the solar plexus. Perhaps no single regulation has had more negative impact on jobs in the economy than has Obamacare. The regulations are not yet fully implemented but they are already causing a disaster in job creation. Across the country employers are shifting employees from full time (defined as 30 hours or more a week) to part time status so that they can avoid the taxes associated with Obamacare. The result is that fewer people will have full time jobs and must take two or three part time jobs to make what they would have at one full time job. That is the definition of inefficiency. From a quality of life perspective Obamacare is going to result in parents spending more time out of the house as they work their two six hour jobs with two hours in between or they work seven days to earn a full time equivalent paycheck. Even without families, everyone is going to have less leisure time to do everything from go to restaurants, the movies, the beach, play sports, read books or whatever it is they love to do.   The small businesses lose out as well. While they may avoid paying the Obamacare taxes for a while, they now have to provide the training, scheduling, management and administration support for more employees than they would if they could fill their jobs with full time employees.  Obamacare is a job killing machine, and with it goes the dreams of millions of Americans who were hoping that a job would help them achieve their life's goals.  

With a flawed government focused mindset, his administration has already accomplished what Barack Obama suggested it would take two terms to finish: “Fundamentally transforming the United States of America”. Unfortunately for those seeking to pursue the American Dream, the Barackalypse he has created has little resemblance to the dynamic America whose engine drove our own and the world’s prosperity for a century. At some point in the future when anthropologists discover the ruins of what was once America they will wonder what kind of Apocalypse could have destroyed such a great and powerful nation. One wonders what curious artifacts will remain that indicate the damage was self inflicted when the citizens twice elevated to their presidency a self aggrandizing man with no understanding of how the world actually works beyond the chimerical fantasy created in his mind and perpetuated by a cabal of empowering sycophants. Perhaps the story the write will be "Barackalypse Now, the story of one man's destruction of the American Dream".