A professor of history and international affairs at Princeton University, Harold James, makes the point that government spending and power fuels inequality:

what is fueling inequality now is not unfettered capitalism, but problematic public-policy efforts to stabilize economies in the wake of the financial crisis. Capitalist competition erodes monopoly profits, whereas public policy risks creating entrenched privilege.

The liveliest example Professor James offers is that of China's high-speed rail system, often cited as a model by President Obama and Thomas Friedman: "The seamy side of China's post-crisis stimulus package was ventilated in the trial of Liu Zhijun, who oversaw the development of China's showcase high-speed rail network – a position that garnered him 374 properties, 16 cars, and 18 mistresses."

The Congressional Research Service is taking some heat from the Tax Foundation for a report claiming that taxes have no effect on economic growth. Asks the Tax Foundation: "They show no adherence to science, but instead appear to be driven by an extreme pro-tax agenda. Why are taxpayers spending over $100 million a year on a group that systematically misleads Congress into voting for higher taxes?"

That is an excellent question.

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Libertarian law professor Richard Epstein reports from his recent trip to India:

Today, the central reforms that are needed in India have nothing to do with local cultural, historical, and religious differences. The usual panaceas of minimum wage and housing laws will not do the trick. The conditions are so arduous and deplorable that any more regulations, however modest, would consign millions of innocent Indians to a fate worse than that which they face by stripping from them the few options that are left under the current system.

From a New York Times news article about trouble facing plans for a high-speed rail line between San Francisco and Los Angeles:

Joe Nation, a professor of public policy at Stanford University and a critic of the plan, said Mr. Brown would have to grapple with this decline in support, which he argued reflected voters' growing doubts about the basic competence of government.

"Obamacare has leached over into this," Mr. Nation said. "You have people saying, 'The federal government that can't build a website — how can we expect them to build a multibillion-dollar train?' "

That's pretty interesting analysis with far-reaching implications if it turns out to be true.

How to solve the "inequality crisis" announced by New York mayor Bill de Blasio is the topic of my column this week, which also discusses how Hillary Clinton and President Obama might help with this issue. Please check out the column at Reason (here) and Newsmax (here). And while you are at it, if you missed last week's column, on how capitalism worked to fix my broken car window, that article, too, is available at Reason (here) and Newsmax (here).

The assistant majority leader of the Massachusetts House of Representatives, Kathi-Anne Reinstein, a Democrat who represents the city of Revere, is stepping down from her elected office to go become the government affairs manager of the Boston Beer Company, the Boston Globe reports. It reminds me of Jim DeMint, the Republican from South Carolina who quit his U.S. Senate seat to take over the Heritage Foundation.

From a New York Times business section article about the comeback in the luxury car market:

Outside of Minneapolis, for example, Morrie's Luxury Auto received 16 of Maserati's Ghibli sedans two days before Christmas and had two left on Dec. 26.
Morrie's is also selling two to four Bentleys a month at an average price of $225,000. About 40 percent of those sales are to companies that use them to transport clients and executives, the dealership said. It has benefited from the rising fortunes of large public companies in the area like 3M, Target, and General Mills.

The Winter Issue of National Affairs just came up on the Web, and it is full of newsworthy material, including an article about Irving Kristol and Gertrude Himmelfarb that runs under the headline "The Brooklyn Burkeans," and an article by Michael Strain under the headline "A Jobs Agenda for the Right," which suggests, among other ideas, "relocation subsidies to the long-term unemployed to finance a good chunk of the costs of moving to a different part of the country with a better labor market" and "significantly lowering the minimum wage for the long-term unemployed for at least the first six months after the date they begin work at their new job."

There's also an article by Michael Gerson and Peter Wehner headlined "A Conservative Vision of Government."

The Affordable Care Act includes a 10 percent federal excise tax on indoor tanning services, which went into effect July 1, 2010.

I was driving through Spencer, Mass., the other day and passed Guaranteed Fitness, which describes itself as the largest 24-hour gym in the entire state of Massachusetts. There's a big sign out front touting memberships for $29 a month, which include "free tanning."

If the tanning is "free," the excise tax is zero.

Sure enough, the IRS web site explains that the fitness club membership fee "is not subject to the indoor tanning services tax."

Stanford's Alvin Rabushka points out that while more and more scholars at top universities are bemoaning inequality and some are even gathering in "Centers for the Study of Inequality and Poverty Reduction," (CISPRS),

To the best of my knowledge, no CSIPR in an elite institution has issued a policy paper recommending that some of its university's endowment and annual gifts, and some of its faculty's salaries and benefits, be transferred to less wealthy colleges that face the daunting task of educating the majority of America's future work force.

CSIPRs recommend redistribution of income and wealth for all except for the centers and professors in them.

Nicholas Lemann reviews George Brock's book Out of Print, which is about the future of news:

In the United States, newspaper advertising revenue – the main source of economic support by far – was $63.5 billion in 2000. By 2012 it had fallen to $19 billion. (During the same period, advertising revenue at Google went from zero to $46.5 billion.) Employment in the American newspaper industry fell by 44 per cent between 2001 and 2011... Brock is so persuasive at presenting professionalized journalism as a late and unexpected development in the history of the press that he can then suggest that it might simply disappear without sounding melodramatic or alarmist.

Link via The Browser.

"Grumpy Economist" John Cochrane has a post about a free-market alternative to ObamaCare:

We need to permit the Southwest Airlines, Wal-Mart, Amazon.com and Apples of the world to bring to health care the same dramatic improvements in price, quality, variety, technology and efficiency that they brought to air travel, retail and electronics. We'll know we are there when prices are on hospital websites, cash customers get discounts, and new hospitals and insurers swamp your inbox with attractive offers and great service.

Libertarian law professor Richard Epstein has a column up at the Hoover Institution web site giving two examples of the way the Supreme Court has imaginatively rewritten the Constitution — the "cruel and unusual punishments" language in the Eighth Amendment and the Article One taxing power. Regarding the taxing power, Professor Epstein writes, "the vital element in this clause is that it prohibits any transfer payment from one group of individuals to another, as those cannot serve the 'general welfare of the United States.'"

Forty-three senators have written a letter to Secretary of labor asking him to get the Occupational Safety and Health Administration to stop enforcing regulations against family farms that are exempt by law from the regulations. From the letter:

Worker safety is an important concern for all of us—including the many farmers who probably know better than OSHA regulators how to keep themselves and their employees safe on farms. If the Administration believes that OSHA should be able to enforce its regulations on farms, it should make that case to Congress rather than twisting the law in the service of bureaucratic mission creep. Until then, Congress has spoken clearly and we sincerely hope that you will support America's farmers and respect the intent of Congress by reining in OSHA.