If an American political candidate called for eliminating entirely the federal departments of education, commerce, energy, transportation, and housing and urban development, along with the Securities and Exchange Commission, Social Security, and Medicare, the candidate would probably be denounced as extreme.
So give Michelle Caruso-Cabrera, an anchor at CNBC and the author of You Know I'm Right: More Prosperity, Less Government, some credit for writing a book that stakes out and defends these positions.
"Man is not free unless government is limited. There's a clear cause and effect here that is as neat and predictable as a law of physics: As government expands, liberty contracts," she writes. She does write that — but she is quoting a January 1989 speech by President Reagan. It's a reminder that ideas that ideas that initially may seem extreme can win wide support with the right politician communicating them.
As a communicator of political ideas, Ms. Caruso-Cabrera, whose grandparents fled Cuba and Communist dictator Fidel Castro in 1962, is no slouch herself. There's a lot of policy substance in this book and a lot of clear writing and clear thinking to go with it.
On health insurance, she writes, "The debate in Washington is between those who favor employer-based health insurance and those who favor government-based health insurance." They're both wrong, she says: individuals should control their own insurance.
On ObamaCare's "new 3.8 percent tax on unearned income, which includes dividends, rents, capital gains, interest, and a host of other investment incomes," she writes, "Government will tax investment. That means we will get less investment as a result. When you raise taxes on something, you get less of it. That's how higher taxes on cigarettes are justified by politicians."
There's an excellent chapter on the credit ratings agencies. This chapter alone would be worth the price of the book for the history of what she calls the "long process that led the ratings agencies to be first regulated and then legislated into profitability."
Ms. Caruso-Cabrera has a comeback to the post-financial crisis arguments against personal retirement accounts as a substitute for Social Security: "The argument against personal accounts is that they are too dangerous: you will be subject to the vagaries of the stock market. Okay — so is being subject to the decisions of some unknown future members of Congress safer? They've already reneged once, on the ultimate retirement age. What's next? Remember, you have no legal rights with regard to those benefits, and Congress can change them at any time."
On immigration, Ms. Caruso-Cabrera is in the camp that sees free movement of people as part of the free market: "Here are five reasons why you should embrace immigration to the United States: eBay, Yahoo, Google, and Sun Microsystems. All were founded by immigrants."
"When it comes to immigration, I call for an open-door policy. No quotas. None. Whoever wants to come is allowed to come. If you pose no security threat to our nation, you are welcome to pursue the American dream," she writes.
The book is not without its occasional internal contradictions. The author praises Clinton in part because "in 2000, Clinton's last year in office, the surplus was an inspiring $230 billion." What's inspiring about the government taxing away more money from the people than it needs to spend? Later, more soundly, she quotes Milton Friedman, "Our country would be far better off with a federal budget of $1 trillion, and a deficit of $300 billion, than with a fully balanced budget of $2 trillion."
Ms. Caruso-Cabrera at one point writes, "As a consumer you can't choose a different, more efficient police or fire department, public school system, or post office. You are stuck with the ones in your area." Later, more soundly, she paraphrases Milton Friedman: "He generally felt there should be as little concentration of power in Washington as possible, because if people didn't like the policies in one state or town, they could move to another."
She cheapens her argument by throwing in some cheap shots at Republicans. "At least the Democrats don't hate gays and immigrants," she writes. Given President Reagan's 1986 immigration "amnesty" and the strenuous effort by President George W. Bush and Senator McCain, both Republicans, to work with Senator Kennedy to forge a comprehensive immigration "reform," it seems unjustified to accuse the Republicans of being an immigrant-hating party.
Ms. Caruso-Cabrera also fails to give George W. Bush the credit I think he deserves for tax cuts. "When it came to fiscal issues Bush was nothing but a died-in-the-wool liberal," she writes. "Tax cuts are worthless, even damaging, if they aren't accompanied by cuts in spending as well." At least such tax cuts allow the individuals who earned the money to keep it. In some cases the dynamic growth effects of tax cuts are such that spending doesn't have to be cut; a tax cut at some point on the Laffer Curve may actually produce more government revenue.
She writes, "Bank of America and Citigroup, the banks that received the most bailout money ($45 billion each), have paid it all back." Not so. According to the October 21 TARP transactions report issued by Treasury, the government put $49 billion into Citigroup and has gotten $16.4 billion back. The rest has been "repaid" in Citigroup shares that the government still owns.
The author argues that America should stop paying to defend Europe. "The European economy is bigger than the American economy. There is no good reason for us to foot the bill for them." This falls into the "be careful what you wish for," department. Does America really want Europe, including Germany, developing into a military superpower to rival us?
Each chapter in the book ends with a variation on the phrase, "you know I'm right," a device that I thought did not work particularly well.
The author at times expresses frustration or hostility toward the religious right, without seeming to understand that for many, religion is the basis of the respect for individual human liberty and property rights that Ms. Caruso-Cabrera is such an articulate and passionate defender of.
On the whole, though, Ms. Caruso-Cabrera has written a lively and provocative book. With it, she joins Larry Kudlow (who writes a foreword to this book), Tea Party inspirator Rick Santelli, and Net Net blogger John Carney in the ranks of CNBC staffers who have been forthright about their free-market leanings. Fox Business network, meanwhile, is assembling its own staff of libertarians, including John Stossel and Judge Napolitano. So if ideas like eliminating five cabinet-level departments along with the SEC, Medicare, and Social Security seem remote from the mainstream of our present political debate, well, you never know.
Disclosures: I was sent a free review copy of the book. If you buy it from the link above this site gets a share of the revenues.
