The Obama administration is using a "national security" argument to justify a request to Congress to spend $108 billion on funding the International Monetary Fund, Reuters reports. "With adequate funding, the IMF will strengthen our national security by mitigating the economic crisis and inhibiting the growth of terrorist networks," says a letter to Congress from the secretary of state, the secretary of defense, and the national security adviser.

The chief executive of NYSE Euronext, Duncan Niederauer, warns in the Financial Times:

With 39,000 employees of financial regulatory agencies, the US already has more than 12 times as many regulatory personnel as the UK's 3,100, although its gross domestic product is only seven times bigger. Simply adding regulators to this existing army would not have prevented the meltdown. Regulatory overreaction would limit access to capital markets, damping the entrepreneurial energy that is critical to any sustained economic recovery. It would also drive companies and jobs to overseas markets.

The many Americans for whom quarterly estimated tax payments are due today may find illuminating this video of Senate Majority Leader Harold Reid claiming that the American income tax system is "voluntary." It's been viewed more than 1.7 million times on YouTube.

Apparently puzzled by Forbes's advocacy of capitalism, a column in the New York Times quotes an explanation offered by an author, Fran Lebowitz: "Rich people always have to believe that government is the problem and that they have the answer."

How much does the government spend, measured as a percentage of the Gross Domestic Product? Or to ask it another way, what percentage of the total American economy does government spending make up? The Wall Street Journal this morning has a chart, headlined, "Government spending as a percentage of GDP," that runs along with a front-page article. The chart shows the government share climbing toward the end of the chart to about 28% or 29% of the economy. That doesn't mention, though, that it is only measuring federal government spending. Add in state and local government spending and the chart looks more like this or this, with the combine government share somewhere between 37% (2008) or 45% (2009) of the American economy. Looking only at the federal share, as the Journal chart does, understates the role of government in the economy, which in America has now reached levels roughly equal to Canada's.

The Wall Street Journal has a newly published interview with Obama aide Lawrence Summers in which Mr. Summers responds to the "socialism" question much the same way that President Obama did when he was asked about it by the New York Times, by referencing the Bush administration:

Wall Street Journal: Is there a risk that the public is going to view the administration as much more interventionist than it wants to be viewed?

Mr. Summers: I think it's important to recognize that it was the previous administration that launched capital investments in all the major financial institutions, and that made loans to the automobile companies insisting on the presentation of "restructuring plans."

FutureOfCapitalism.com, "Rove on 'Socialized Health Care,'" June 11, 2009, 7:02 a.m.:

It seems quite a straddle to argue simultaneously that a public option would (1) fix prices at "less than market rates" and therefore "undercut private insurers," i.e., be too cheap and (2) be "far too expensive" at the same time. If 71% is too expensive for the government, why shouldn't 100% be too expensive for individuals and businesses. I'm not an advocate of socialized medicine, but if Republicans or anyone else is going to block it from advancing further than it already has already in America, they are unlikely to succeed in doing so by arguing that it would simultaneously be too cheap and too expensive.

Slate's Mickey Kaus, "You Want Irreversible, Rove? I'll Show You Irreversible," June 14, 2009, 12:01 a.m.:

One of the admissions in the talk that a key White House economic aide, Lawrence Summers, gave Friday to the Council on Foreign Relations (another FutureOfCapitalism.com post about the Summers talk is here) was this one: "It is too early to know how successful our policies have been. It is not even clear how we will know ultimately whether they have succeeded, because of the difficulty of constructing a counterfactual and knowing what would have happened without intervention."

It's actually a pretty stunning concession, that there is essentially no way of knowing whether the interventions into the economy begun by President Bush and his Treasury secretary, Henry Paulson, and advanced by President Obama, did any good, because we can only speculate about what would have happened otherwise.

President Obama is now apparently concerned enough about the doubts about his government interventions in the economy that he sent one of his top economic aides, Lawrence Summers, off to New York to try to reassure America. Mr. Summers, in his talk at the Council on Foreign Relations, acknowledged that "suggest that the interventions of the last year represent an overreach, a kind of back-door socialism that may threaten the very underpinnings of our market-based economic system." Much of his talk was aimed at answering that accusation:

any interventions in which we participate will go with, rather than against, the grain of the market system. Our objective is not to supplant or replace markets. Rather, it is to protect the market system from its own excesses and to improve the protection of that system going forward.

You know, in the long sweep of history, Franklin Roosevelt's policies were denounced by many at the time as a radical attack on capitalism, but today are understood to have helped preserve the market system.

Here's at least one sign that America, too, hasn't entirely abandoned its enthusiasm for capitalism (for the report from Europe, see here). When 27 young New Yorkers took their oaths to become new American citizens yesterday, they did so not in a courthouse or other government building but in a shopping mall, the Daily News reports.

Writing in the Financial Times, Philip Stephens has some interesting thoughts on the mood in Europe: "Support for the market economy has proved resilient. Disillusioned as they are with the excesses – and enraged as they should be by the larceny of some bankers – Europeans have not been clamouring for command-and-control capitalism....Much as the global crisis has severely damaged confidence in the invisible hand of the market, voters do not want to see it replaced by the clunking fist of an over-mighty state. I detect precious little appetite across Europe for higher taxes....Beating up on capitalism may satisfy old ideological prejudices but it does not answer the demands of voters for prosperity and fairness."

Bloomberg has a review of Pete Peterson's book in which the reviewer manages entirely to avoid even touching on the policy issues that FutureOfCapitalism.com covered in our own review.

The Wall Street Journal has a robust editorial today about the Obama administration's efforts to crack down on executive pay, an effort we discussed two days ago here. The concluding paragraph of the Wall Street Journal editorial begins:

The new pay limits betray once again that Washington's dominant impulse today is leveling and redistribution: Put caps on success, raise taxes on what you can't cap, and then give the money to someone else.

The word "leveling" caught my eye, as the author of a book on Samuel Adams, because that leader of the American Revolution used that exact term to disparage schemes he disagreed with that interfered with property rights. Here is Adams in a 1768 letter to Massachusetts's agent in London:

It's not often that you hear a chief executive telling consumers to use less, please, of the product he sells. Can you imagine a supermarket owner telling consumers to buy less food, or a book publisher telling consumers to read less? Yet that is essentially what the chief executive of Andarko Petroleum, Jim Hackett, does in this interview published by the Federal Reserve Bank of Dallas:

Turn out the lights when you leave a room. Adjust the thermostat up in the summer and down in the winter by a few degrees. Shut off your computer at the end of the day. Carpool to work if you can.

When the oil companies are promoting carpooling, it's a good indication that political or regulatory pressure, or the threat of it, is in the picture. Maybe Mr. Hackett figures that the long term benefit of deterring huge government subsidies to his competitors or punitive taxes and regulation on his profit is worth any short term cost imposed by the risk that people might take his advice and start car-pooling.

FutureOfCapitalism.com, June 10, 2009, 5:23 p.m.:

Great Britain, one of America's major trading partners, adopted "say on pay" in 2002. Yet the British financial sector is in just as bad shape, or worse, than America's is, calling into question the idea that "say on pay" would have prevented the financial crisis.

The Financial Times's "Lex" column, June 10 2009, 22:32:

remember that independent pay committees and shareholder votes on packages are norms elsewhere, including the UK, and failed to mitigate the crisis.